Austria Says Won't Host Iran Sanctions-Busting Payments System

Austria has rejected hosting a special payment system designed to help EU countries trade with Iran despite US sanctions, the Austrian foreign ministry said Tuesday.

"We were asked if Austria would be prepared in principle to host this special purpose vehicle," foreign ministry spokesman Peter Guschelbauer said.

But after studying the idea "very closely", the Austrian government "came to the conclusion that at the moment we are not in a position to host this vehicle," Guschelbauer told the Austrian APA agency.

The Bloomberg agency reported that Austria had been approached to be the venue for the vehicle after Belgium and Luxembourg had already turned down the idea of hosting it.

"There are lots of unanswered technical questions" about the "effectiveness of this setup," Guschelbauer added.

Austria supported the principle of the vehicle, he said, "but of course it has to be set up in a way that fulfils its purpose".

Last week the US announced a fresh raft of sanctions, the latest tranche of such measures since May when US President Donald Trump dramatically withdrew from the 2015 nuclear deal between Iran and world powers, known as the Joint Comprehensive Plan of Action (JCPOA).

The US sanctions aim to cut off Iran's banks from international finance and significantly cut its oil exports.

Since May, the remaining five signatories to the JCPOA—Britain, China, France, Germany and Russia—have been exploring ways to keep the deal alive.

As part of those efforts the EU has floated the idea of the special purpose vehicle, which would in theory allow Iran to keep selling oil and European companies to continue doing business in the country despite the US sanctions.

However, details of the scheme have remained vague.

The Austrian capital Vienna is the headquarters of several international organizations, including several arms of the UN and OPEC, and hosted the negotiations which resulted in the JCPOA.

On Monday the UN atomic watchdog the International Atomic Energy Agency (IAEA) said in its latest report that Iran was still abiding by the terms of the deal.

Photo Credit: IRNA