Robert HARNEIS -TDO- (FRANCE)- Europe and Iran have completed their first transaction under a system set up to avoid US sanctions on the Islamic Republic.
Germany's Foreign Ministry said on Tuesday that the creation of the INSTEX mechanism has enabled the export of medical devices from Europe. The ministry - speaking on behalf of Germany, France and the UK - said the mechanism would allow many other transactions to proceed.
The system was devised more than a year ago, after Washington reimposed harsh sanctions on Iran's oil industry after Donald Trump withdrew from the UN sponsored 2015 nuclear deal between six world powers and Tehran.
European firms had no option but to cease trading with Iran and cancel joint-venture projects for fear of their assets being penalized in the United States.
INSTEX aims to at least partially maintain that trade and thus persuade Iran not to walk away from the nuclear agreement.
Transactions can now be carried out via INSTEX, a protective shield that ensures that no money directly changes hands.
Under the nuclear agreement with the United States, China, Russia, Britain, France and Germany, Iran committed in 2015 to redesign its nuclear program so that it could not build atomic weapons.
In return, many sanctions were lifted and trade with Tehran was promoted.
Trump withdrew from the deal in May 2018 and a year later, Iran began to gradually move away from its obligations under the agreement.