The lifting of sanctions in Iran has been extensively discussed across the media but in reality few know the exact details of what really happened and the current position.

In July 2015, France, Germany, the UK, Russia and the USA reached an agreement with Iran on the nuclear deal. It was agreed that upon the successful implementation of this deal by Iran (showing its commitment to an exclusively peaceful nuclear programme), the sanctions would be lifted. On 16 January 2016, the International Atomic Energy Agency verified that Iran had completed and implemented all necessary required steps to reach “Implementation Day”.  As a result, there are now only a few sanctions remaining in place and Iran should be able to trade with the international community.

Which financial sanctions remain in place? And what is allowed under the law?

The sanctions that remain in place are mainly financial and relate to arms and the nuclear programme, although some non-financial ones also still exist. Any country that wishes to trade with Iran in these areas needs to obtain the relevant licences from their government prior to entering any contracts.

The government published a guide about trading with Iran in April 2016 which expressly states:

 ‘EU restrictions on financial transfers, banking activities, financial messaging services to and from Iran have now been removed as part of the sanctions relief triggered on Implementation Day (although some Iranian banks remain listed in relation to proliferation sanctions). This now allows financial transactions to go ahead with Iran, provided no listed entities or individuals are involved. It is important to note that US financial institutions will continue to be blocked from carrying out transactions that involve Iranian entities. The US block on dollar transactions will also remain in place. You should consult US guidance for further information on the US sanctions and restrictions that remain.’

In the light of the above, a question comes to mind: If the UK government is allowing financial transactions with Iran, why are UK banks still reluctant to enter into any kind of transaction with Iranian individuals, companies or banks? Do UK banks follow the local government’s rules or the foreign governments’ rules? Surely local law is the governing law in the UK? Are the UK banks breaking the law? Maybe the UK needs to Brexit from the USA position – rather than the EU.

Economic opportunities for UK after Brexit

Since summer 2016, and following the referendum to leave the European Union, the UK has suffered many losses. The pound has not been as low as its current value for the last three decades. The market and shares are very vulnerable, and many commercial areas are pausing or at a standstill. At the same time, the UK is missing many opportunities to invest/do business with Iran. There are still large amounts of Iranians’ monies which are frozen in the UK bank accounts. The release and availability of these funds could allow Iranians to purchase goods and services from the UK and may even result in an immediate boost of the UK economy.

 The April guide published by the government ranks Iran as the second largest economy in the Middle East after Saudi Arabia and the second largest population in the Middle East after Egypt, with a population of around 77 million people.

From oil and gas reserves and other natural resources to agricultural products (i.e. saffron, pistachio, caviar) and Persian rugs, Iran has high export potential and a lot to offer to the rest of the world. On the other hand, Iran also has a high demand for importing medicine, electronics, luxury goods, cars – the list is long! There is also demand for investments in infrastructure and numerous projects inside Iran. The value of current EU trade with Iran is around $8bn and is expected to increase to $16bn in the next two years. The UK is falling behind and should be grabbing the opportunity to trade with Iran – boosting the economy after Brexit.

Shahrzad Atai is head of the Middle East desk at London-based law firm Child & Child