Understanding U.S. Secondary Sanctions Targeting Iran

The United States has imposed secondary sanctions on Iran, aimed at depriving it of access to the global financial system and exerting maximum economic pressure on it. These sanctions target foreign companies and banks that do business with Iran, even if they are not directly connected to the United States. They are enforced on those who violate them or engage with targeted sectors such as aviation, technology, digital assets, gold, and shipping. Secondary sanctions rely on halting transactions with Iran, freezing the assets of companies that deal with it, and restricting their accounts within the U.S. financial system, exposing them to penalties by Washington. The importance of these sanctions is amplified by the US dollar, which is used in half of international payments, thus expanding U.S. influence abroad and forcing foreign companies to comply to avoid losing access to the U.S. financial system and opening American markets. While the sanctions do not directly target humanitarian activities such as medicine and food, the challenges involved in implementing these sanctions increase the complexity of dealings with Iran and threaten foreign companies with legal and financial damages.

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