Business First Look

Iran sanctions US companies: Will that hurt? (+video)

Following sanctions issued by the Trump administration, Iran recently announced their own set of sanctions against United States-based companies, further complicating diplomatic relations between the two countries.

Supreme Leader Ayatollah Ali Khamenei attends a meeting with a group of the air force commanders in Tehran, Iran, Feb. 7, 2017. Iran announced sanctions against 15 US companies on Sunday, in retaliation for US imposed sanctions issued by the Trump administration on the preceding Tuesday.
Office of the Iranian Supreme Leader/AP
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In a Foreign Ministry statement carried by the state-run IRNA news agency on Sunday, Iran announced sanctions against 15 American companies it claims support terrorism, repression, and Israel’s occupation of Palestine.

“The sanctioned companies have, directly and/or indirectly, been involved in the brutal atrocities committed by the Zionist regime in the occupied Palestinian territories,” the Foreign Ministry said via statement, quoted by the IRNA.

The move is a retaliation for a set of sanctions imposed by the Trump administration on Tuesday, which target foreign individuals and corporations that contributed to Iran’s ballistic missile program.

“Iran’s proliferation of missile technology significantly contributes to regional tensions,” the State Department said, according to The Wall Street Journal. “The imposition of sanctions against these 11 foreign entities is a continuation of our commitment to hold Iran accountable for its actions.”

Citing evidence that Iran has been providing missile support to the Houthi rebels in Yemen, the US State Department imposed sanctions on 30 different organizations and individuals, many of which are Chinese and Russian.

The Houthi rebels are involved in the ongoing conflict in Yemen where the group opposes the internationally recognized government of President Abdrabbuh Mansour Hadi.

Aside from the 11 entities which the State Department identifies as having supported Iran’s missile development, the remaining 19 companies and individuals that received recent sanctions did so because they violated the Iran, North Korea, and Syria Nonproliferation Act, according to the US administration.

According to the State Department, they were believed to have gathered or distributed technology that could directly contribute to the development of weapons of mass destruction in those three countries.

As a result, Iran issued its own sanctions against US companies they claim assisted Israel in violating UN Security Council Resolution 2334, which urges Tel Aviv to cease its settlement expansion activities.

“The Islamic Republic of Iran condemns the recent measure taken by the United States administration to impose one-sided extraterritorial sanctions against Iranian and non-Iranian individuals and institutions,” Iran stated directly in their latest announcement.

Remaining to be seen, however, are the effects the recent sanctions will have on the US companies, as according to ABC News, no knowledge currently exits of any of the firms doing business within the Islamic Republic of Iran.

The corporations themselves, coming from a variety of industries, range from American real estate company Re/Max Holdings, to tactical truck builders and major arms manufacturers.

While the institutions specifically targeted by the sanctions may not feel the repercussions directly, the latest measures taken by both countries have the possibility of eroding the diplomatic relationships that have been developing since 2015 when a deal was struck in which Iran agreed to limit its uranium enrichment in exchange for lifted economic sanctions.

Following the 2015 agreement, Boeing – the America-based airplane manufacturer – made a $16.6 billion deal with Tehran for a supply of passenger planes.

Since President Trump’s inauguration, however, diplomatic relations between the two countries have begun deteriorating, with the president taking to Twitter to condemn the 2015 deal.

Currently, both the US and Iran are involved in Iraq and Syria where a US-led coalition and Iran-backed forces are combating Islamic State militants (ISIS).