National Security

Trump Admin Vows Penalties for European Countries Doing Business With Iran

U.S. sets hardline policy in face of European allies seeking to skirt sanctions

Iranian President Hassan Rouhani and Mohammad Javad Zarif, Iran's foreign secretary
Iranian President Hassan Rouhani and Mohammad Javad Zarif, Iran's foreign secretary / Getty Images

BRUSSELS—The Trump administration will cut off all Iranian business interests in Europe and elsewhere as part of what it calls a "maximum pressure" campaign against Tehran that seeks to isolate the Iranian hardline regime and its allies, according to senior U.S. officials and congressional insiders who spoke to the Washington Free Beacon.

Iranian leaders and some of its partners in Europe have been scrambling to skirt tough American sanctions that went into effect early last month.

Senior officials in the Trump administration tell the Free Beacon this policy of appeasement will not stand as it works to slice oil revenues to the Islamic Republic, which was recently granted waivers—to the consternation of many of Capitol Hill—so that it can continue its lucrative crude oil trade.

European countries are scheduled later this week to examine pathways to skirt U.S. sanctions and keep the lines to Iran open, a movement the Trump administration is said to be diplomatically opposing, according to officials apprised of the meetings.

The Trump administration will not stand idly by as European allies work behind their backs to appease Iran, particularly as it pertains to the country's oil exports.

"Investors seek business climates that are stable, transparent, and accountable," a senior State Department official told the Free Beacon, speaking only on background about the sensitive diplomatic issue. "Iran doesn't come close to meeting any of these benchmarks. The regime in Tehran has repeatedly failed to adopt the most basic anti-money laundering and terrorist financing standards and it continues to fund destabilizing and destructive proxy wars throughout the region."

Still, European allies are searching for a lifeline to continue performing lucrative business operations in Tehran. Trump administration officials and top allies on Capitol Hill tell the Free Beacon this course will not stand.

"The Islamic Revolutionary Guard Corps is also heavily invested in nearly every segment of the Iranian economy, so European companies never really know if they're supporting commerce or terrorism or illegal missile testing," the senior U.S. official said. "This isn't the kind of environment any company should feel comfortable operating in. If these risks aren't enough to deter investors, the threat of U.S. sanctions certainly should be."

This stance by the Trump administration diverges greatly from that of the Obama administration, which sought to coddle Iran and its European allies in order to forward the landmark nuclear agreement, which Trump dismantled earlier this year.

This hardline policy is already winning plaudits on Capitol Hill, particularly among Trump administration allies who have long sought to isolate Iran from the international marketplace.

The Trump administration's threats regarding Iranian business endeavors is being treated favorably among these advocates, who told the Free Beacon that European companies seeking to continue business with Iran are operating on borrowed time.

"Most European companies already know they shouldn't invest in Iran, in part because our envoys over there have been working tirelessly," said one senior Republican congressional staffer who works with the administration Iran issues.

As the issue of European business ties with Iran becomes more fraught, sources within the Trump administration and Congress tell the Free Beacon more concrete action will be taken to isolate those who buck the Trump administration.

"Not all companies, or for that matter governments, have gotten the memo, despite Iran launching ballistic missiles and trying to blow up dissidents on European soil," the senior congressional source said. "That's what Congress is for. Staffers from both parties are meeting to discuss areas of mutual concern, like human rights, where everyone agrees that anyone who facilitates Iranians atrocities should be sanctioned into the ground."