European nations have exported medical goods to Iran in the first transaction conducted under INSTEX, a trade mechanism set up to barter humanitarian goods and food after the U.S. withdrawal from a 2015 nuclear deal.
The German Foreign Ministry said the medical goods were now in Iran and added that the Instex trade mechanism and its Iranian counterpart would now work on more transactions and on enhancing the system. The ministry — speaking on behalf of Germany, France and the UK — said the mechanism would allow many other transactions to proceed.
According to the website Bourse & Bazaar, an individual with knowledge of the transaction, speaking on background, said that a German exporter had used the INSTEX mechanism to receive payment for the sale of medication to an Iranian private sector importer. The transactions was later reported to be worth EUR 500,000.
The transaction was separate from an initiative earlier this month by Britain, Germany and France to help Iran fight the coronavirus, which included an urgent shipment of medical material, including equipment for laboratory tests, protective body suits and gloves, Reuters quoted a ministry source.
Britain, France and Germany established the special purpose vehicle “The Instrument In Support Of Trade Exchanges” dubbed INSTEX in January 2019, after Washington reimposed sanctions on Iran after Donald Trump unilaterally withdrew the US from the 2015 nuclear deal, the Joint Comprehensive Plan of Action (JCPOA), which was signed in 2015 between Iran and China, France, Germany, Russia, UK, US, Germany, and the EU.
European efforts to ensure that Iran can keep trading in spite of the sanctions have had little impact amid the unilateral US secondary sanctions on banking ties between Europe and Iran, and also because of technical challenges. But with the new management and expansion of the staff at INSTEX last summer, the vehicle has been working on several transactions.
Last November Finland, Belgium, Denmark, Netherlands, Norway, and Sweden announced that they join the INSTEX mechanism for trade with Iran.