An Italian company penalized for aiding Iran in evading U.S. sanctions has been de-listed by the Obama administration, prompting criticism from experts who believe the United States is caving to the Islamic Republic’s demands before it upholds its end of the recent nuclear deal, according to information provided by the Treasury and State Departments.
The Obama administration announced the removal of sanctions on Dettin Spa on Nov. 19.
The announcement came as President Hassan Rouhani was scheduled to visit Italy over the weekend. The trip was canceled following terrorist attacks in France.
Dettin Spa, a textile and chemical company that still has a presence in Iran, was sanctioned by the United States in August 2014 for "knowingly providing Iran’s petrochemical industry with goods and support whose value exceeded $250,000," according to a statement issued by the Treasury Department at the time.
"Individuals and companies providing support to illicit Iranian nuclear activities program or engaged in assisting Iran’s efforts to evade U.S. sanctions will face serious consequences," the Obama administration warned when it announced the company’s designation as a result of the sanctions-busting scheme.
Iran has faced renewed scrutiny over its failure to uphold the nuclear deal following charges that it had stopped dismantling nuclear centrifuges at some of its key enrichment sites.
The United States first designated Dettin Spa during a period of negotiations with Tehran over the nuclear deal. The administration sanctioned the company for helping Iran expand its petrochemical industry beyond what was permissible under an interim agreement struck by Iran and world powers.
The company was de-listed from the sanctions rolls last week, along with many other companies sanctioned for doing business with Cuba.
The United States sanctioned Iran’s petrochemical industry along with other industries related to the country’s lucrative shipping sector. The sanctions were aimed at curbing Iran’s revenue.
Experts questioned the timing of the de-listing.
"What raises questions about the de-listing decision is its timing," said Saeed Ghasseminejad, an Iranian dissident and expert at the Foundation for Defense of Democracies. "The de-listings are supposed to happen on the implementation day, it is not clear why this company is removed from the sanction list at this time."
When asked to address the matter, a Treasury Department spokesman deferred to the State Department, which said that it has determined Dettin Spa is no longer in violation of applicable sanctions laws.
The company was removed from the U.S. sanctions list after it protested its continued inclusion, according to a State Department official who spoke to the Free Beacon on background. This included "extensive and ongoing consultations" with the United States by the firm’s lawyers.
"The secretary of state has reviewed an application by Dettin, an Italian company, and has approved the removal of sanctions on the basis that the company is no longer engaging in the activities that were the basis for imposing sanctions under the Iran Sanctions Act (ISA) of 1996," the official said.
The State Department says this move is not related to the implementation of the nuclear accord but rather a "routine step."
"This action is not related to the Joint Comprehensive Plan of Action (JCPOA)," the source said. "Rather, this is a routine step taken in response to a petition by the company. We would refer you to the company for further information."
Ghasseminejad criticized the move, which he views as an undeserved perk for Tehran.
"Removing companies from the sanction list even before the implementation day sends a clear message that Iran is open for business even though Iran has not delivered its nuclear promises yet," Ghasseminejad said. "It sends a strong signal that the regime of sanctions is dead and doing business with Iran has the blessing of the United States."
Iran and Italy have made moves to boost their trade ties in the months since the nuclear deal was announced.
A 150-person trade delegation from Italy, headed by the country’s economic development minister, is scheduled to travel to Iran for talks later this month. At least 1,000 Italian companies will pay a visit to Iran as part of multiple upcoming trade missions, according to Iranian reports.
Two top Italian companies announced a plan earlier this month to invest more than $4 billion in Iran. The companies, Danieli and Fata, are looking to invest in the Iranian steel and aluminum markets, according to reports.
Fata is owned by the Italian conglomerate Finmeccanica, which also is a major U.S. defense contractor. Both Danieli and Fata have been cited by watchdog groups as key investors in the Iranian regime.
While Iran is slated to receive more than $150 billion in sanctions relief as a result of the deal, it is suspected of continuing to circumvent current sanctions laws.
U.S. officials are reportedly investigating claims that Iran has been trying to buy U.S. airplane parts in violation of sanctions.
Meanwhile, Iranian officials have maintained that if the United States imposes any new sanctions, it will walk away from the nuclear deal.