• Congress Readies Additional Iran Sanctions That Would Close the Foreign Subsidiary Loophole
  • February 22, 2012 | Author: Thomas E. Crocker
  • Law Firm: Alston & Bird LLP - Washington Office
  • On February 13, 2012, the Senate Banking Committee placed on the Senate legislative calendar the “Iran Sanctions, Accountability, and Human Rights Act of 2012” (S. 2101) (the “Bill”), which it had approved on February 2, 2012. The 92-page Bill would effectively close the so-called “foreign subsidiary loophole” under which foreign incorporated subsidiaries of U.S. companies have to date not been subject to the Iranian Transactions Regulations (ITR) administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). The Bill contains an extensive package of new sanctions on Iran, including at least five new sanctions that could significantly impact non-U.S. companies or financial institutions. It also contains a variety of sanctions aimed at Iranian sectors other than petroleum or petrochemicals. The Bill is expected to receive prompt consideration, with passage in substantially its current form possible in the coming months. Companion legislation has not yet been introduced in the House of Representatives, but it is expected to be shortly.