PARIS (Reuters) – France’s foreign ministry said on Thursday a so-called Special Purpose Vehicle (SPV) that the European Union is considering creating to enable trade with Iran could be used more broadly to help the bloc avoid the extraterritorial reach of U.S. law.
EU foreign policy chief Federica Mogherini said in September that the new mechanism would be in place by November as it seeks to keep trade flowing even though new U.S. sanctions on Tehran will take effect from Nov. 4.
The idea is to circumvent the sanctions under which Washington can cut off from the U.S. financial system any bank that facilitates an oil transaction with Iran.
Until now, the SPV appeared to focus solely on Iran. But in a reply to Reuters, the French foreign ministry said the idea was for the SPV to go beyond Iran and cover a wider range of EU trade.
“The ongoing work on the special purpose vehicle should facilitate financial transactions for companies wishing to maintain trade relations with Iran, in accordance with European law,” foreign ministry spokeswoman Agnes Von der Muhll said.