"Iran Business Responsibility" launches website

Business & Human Rights Resource Centre is working with International Campaign for Human Rights in Iran on the "Iran Business Responsibility" (IBR) project.

Visit the project website launched in June 2017, and explore the articles below for insights on the new investments in Iran.

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20 March 2017

High-level Iran Delegation and Top Regional Firms to Attend Oman’s International Business and Investment Forum

Author: Muscat Daily

Top companies from the region, Europe as well as a high-level business delegation from Iran are expected to be among the participants at the Ministry of Commerce and Industry’s (MoCI) inaugural Oman International Business and Investment Forum.

The event will be held from April 30 to May 1 at the Sheraton Oman Hotel, Muscat. The forum will provide a comprehensive insight into specific trade and investment opportunities and address high-level issues about the policy and objectives across multiple sectors in Oman as well as other countries such as Iran. This will help enable business leaders to identify new opportunities.


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20 March 2017

Iran struggles to coax Bank of England to open clearing accounts

Author: Reuters, Jonathan Saul and Parisa Hafezi

Iran has asked the Bank of England to set up special clearing accounts for its banks, but has so far been rebuffed in its effort to resolve an impasse that has left it excluded from banking in London more than a year after sanctions were lifted.

Tehran has been hoping for swift reintegration into global trade after its deal in 2015 aimed at curbing Tehran's nuclear program in return for the lifting of international sanctions. Its failure to persuade Western banks to accept its business has been one of the main choke points preventing its rehabilitation.

Banking sources from both Iran and the West, and Iranian political sources close to the talks, said Tehran has approached the Bank of England to seek clearing accounts directly with the UK central bank.

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17 March 2017

Why French Car Makers are Real Winners of Iranian Protectionism

Author: Al Monitor

Iran’s auto industry is only second to its energy sector, accounting for some 10% of the gross domestic product and 4% of employment. Showcasing the Islamic Republic’s efforts to become an industrial economy, it is protected by high tariffs on car imports. However, it is time to ask who benefits most from these tariffs. Indeed, while the trade barriers are ostensibly introduced to protect Iranian automakers, it appears that the primary benefactors are French carmakers who have clearly found their niche in the largest auto market in the Middle East. In this equation, Iranian consumers are ultimately paying for the government’s protectionist policies.

Iran imposes a complicated system of tariffs and taxes on car imports, varying from 40-55% depending on the vehicle type. The government adds a 9% value added tax (VAT) and levies an additional 4% overall sales tax. As such, an Iranian consumer may pay customs and taxes amounting to as much as 80% of the value of an imported vehicle to be able to drive it on Iran’s hazardous roads and Tehran’s traffic-jammed streets.

Indeed, only two firms account for 94% of total output: Iran Khodro Corporation (IKCO) and SAIPA. IKCO has joint venture and license production agreements with French automakers Groupe PSA and Renault. The deals involve local production and assembly of Peugeot and Renault cars, which are exempt from import tariffs. As such, through its agreements with local automakers, PSA and Renault are in effect bypassing Iran’s stringent trade barriers.


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13 March 2017

Hyundai Engineering In $3.2B Petrochemical Project In Iran

Author: OilPrice.com

South Korea’s Hyundai Engineering Co said on Monday that it had signed a deal worth US$3.2 billion with Iran’s Ahdaf Investment Company for the construction of the second phase of a petrochemical complex in Iran.

The project allowed us to spearhead into the Iranian construction market as a lead manager. We plan to do everything in our capacity to clinch additional projects in the future,” a spokesperson for Hyundai told The Korea Herald, which noted that the deal is the largest so far signed by a South Korean company in Iran.

Hyundai Engineering will act as lead manager of the Kangan Petro Refining Complex in southwestern Iran. The petrochemical complex is planned to have an annual production of around 1 million tons of ethylene, 500,000 tons of monoethylene glycol, and 350,000 tons of heavy and light polyethylene, The Korea Herald reported.

The financing of the deal – which was signed as an Engineering, Procurement, Construction and Finance (EPCF) contract -- will be finalized within nine months by Korean banks, the Iranian oil ministry’s news service Shana said on Sunday. Construction will take 48 months, according to the Iranian news service.

The nine-month period to obtain financing could be a potential obstacle to the South Korean company due to the reluctance of banks to do business that has ties to Iran, AFP comments.

A total of 85 percent of the funding is expected to come from Korean banks, including Export-Import Bank of Korea and the Korea Trade Insurance Corporation, a spokesman for Hyundai Engineering told AFP.

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13 March 2017

Iran’s telecom minister says Gazprom and Tehran in talks on gas project investments

Author: Tass

Gazprom and Iran are holding talks on investing in the republic’s gas fields, Iran’s Telecom Minister and co-chairman of the Russian-Iranian intergovernmental commission Mahmoud Vaezi told reporters on Monday.

"Russia and Iran made a decision to cooperate on gas and oil. The gas issue is related to investments into certain gas projects. Gazprom is holding talks with Iran in this regard," Vaezi pointed out.

Tehran plans to hold a tender on the development of oil and gas fields for international companies in late March. Twenty-nine foreign companies were qualified to participate in the tender, including Russia’s Gazprom and Lukoil.

The Presidents of Russia and Iran, Vladimir Putin and Hassan Rouhani, will meet at the end of March in Moscow.

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12 March 2017

Korea's Hyundai Engineering in $3.2 billion Iran deal awaiting funding

Author: Reuters

An Iranian investment fund signed a deal with Korea's Hyundai Engineering Co on Sunday for a 3 billion euro ($3.2 billion) petrochemical project, which is awaiting financing by Korean banks, the oil ministry's website SHANA said.

A subsidiary of the Oil Pension Fund Investment Company signed the agreement which covers the construction of the second phase of the Kangan Petro Refining Company, SHANA reported.

"The financing of this project will be finalised within nine months at the rate of 95 percent ... by South Korean banks," said Asghar Arefi, the Iranian official who signed the accord, according to SHANA.

Arefi said the first phase of the Kangan project was 30 percent completed with an investment of nearly 120 million euros.

Despite the lifting of international sanctions against Iran in January 2016, Iranian officials have complained that remaining U.S. sanctions have frightened away trade partners and robbed Iran of the benefits it was promised under its 2015 nuclear deal with world powers.


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11 March 2017

State TV: Iran Air Receives 2nd of 100 Airbus Jets

Author: US News and World Report

TEHRAN, Iran (AP) — Iran's state TV is reporting that the second of 100 planes it purchased from Airbus follovwing its nuclear deal with world powers has landed in the capital Tehran.

The Iran Air A330 jet touched down Saturday after a flight from Toulouse, France, where the headquarters of the European consortium are located. Iran Air received the first aircraft from Airbus in January.

Iran Air finalized a deal with the European plane maker in December for 100 planes for $18 billion. Iran's flagship carrier has separately agreed to buy 80 planes from U.S. manufacturer Boeing.

Most Iranian planes were purchased before the 1979 Islamic Revolution. As of June last year, only 162 of Iran's 250 commercial planes were flying. The rest were grounded due to lack of spare parts.


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9 March 2017

Linde revives Iran contracts, waits for banking system

Author: Reuters, Georgina Prodhan

German industrial gases group Linde (LING.DE) has revived plant-engineering contracts in Iran that lay dormant for years under sanctions but cannot act on them until there is a way to transfer money out of the country, its chief executive said.

"We have already signed engineering contracts to resuscitate projects from years ago but the banking system has to be fixed first before we can start performing on these contracts," Aldo Belloni told analysts on a conference call on Thursday.

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8 March 2017

U.K.’s Iranian-Owned Banks, Freed of Sanctions, Now Face Trust Barriers

Author: Wall Street Journal, Bradley Hope

Just after the European Union lifted sanctions on several of Iran’s biggest banks last year, Bank Sepah International PLC creaked back to life.

The Iranian-owned, British-licensed bank, located on a prime street in London’s financial district, was all but mothballed for nearly a decade due to sanctions designed to force Iran to abandon its nuclear program. Then in 2015, Iran reached a landmark agreement on the program with the U.S. and other world powers, paving the way for Iranian banks to reconnect to the global financial system. Bank Sepah, which once processed more than 2,000 transactions a month and had a $1.5 billion balance sheet, was eager to get back to business.

Yet, more than a year after the nuclear deal, Bank Sepah still hasn’t processed a single commercial transaction, other than paying 28 employees and some vendors, because it is still effectively frozen out of the financial system, especially in the U.K., by big banks unwilling to risk dealing with Iranian entities.

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7 March 2017

China’s ZTE to plead guilty, settle with U.S. over Iran, North Korea sales

Author: Washington Post, Karen Freifeld

Chinese telecom equipment maker ZTE will plead guilty and pay $892 million to settle allegations it violated U.S. laws that restrict the sale of American-made technology to Iran and North Korea, the company and U.S. government agencies said Tuesday.

ZTE entered into an agreement to plead guilty to conspiring to violate the International Emergency Economic Powers Act, obstruction of justice and making a material false statement, the Justice Department said.

The settlement was made with Justice, the Commerce Department and the Treasury Department.

The Commerce Department investigation followed reports by Reuters in 2012 that ZTE had signed contracts to ship millions of dollars’ worth of hardware and software from some of the best-known U.S. technology companies to Iran’s largest telecommunications carrier.

“ZTE acknowledges the mistakes it made, takes responsibility for them, and remains committed to positive change in the company,” Zhao Xianming, ZTE’s chairman and chief executive, said Tuesday in a statement.

Between January 2010 and January 2016, ZTE directly or indirectly shipped U.S.-origin items worth approximately $32 million to Iran without obtaining the proper export licenses from the U.S. government. ZTE then lied to federal investigators, insisting that the shipments had stopped, the Justice Department said.

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