Several EU states have created a new payment channel in a bid to bypass US sanctions on Iran. It’s called INSTEX and Germany, France and the UK are behind it. It’s designed to allow Iran access to European markets without having to rely on international banks, because banks face penalties under the US-sanction regime. The new payment system will allow Iran to sell products like oil to European customers. Instex would then get the payment due to Iran and keep it. In turn, European companies can deliver food or medicical supplies to Iran, while getting paid by INSTEX. That would allow participants on both sides of system to avoid running afowl of US sanctions that only forbid monetary transactions with Iran – which INSTEX circumvents. Still, companies using INSTEX might risk retaliation from the US.
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