October 19, 2015
October 18, 2015 marked Adoption Day, the latest milestone in the implementation of the Joint Comprehensive Plan of Action ("JCPOA") between the E3/EU+3 (China, France, Germany, the Russian Federation, the United Kingdom, and the United States) and the Islamic Republic of Iran to ease sanctions on Iran in exchange for limitations on its nuclear program.
Adoption Day signaled the day on which the JCPOA became effective and when participants are to begin the necessary preparations for the eventual implementation of their full commitments under the JCPOA. As President Obama explained in an official statement, Adoption Day officially starts the clock for Iran to take steps to remove thousands of centrifuges and related infrastructure, reduce its enriched uranium stockpile, and remove the core of the Arak heavy-water reactor. In exchange for these measures, the other signatories will begin preparations to lift nuclear-related sanctions against Iran in accordance with the terms of the JCPOA.
In a Presidential Memorandum also issued on Adoption Day, President Obama directed the Secretaries of State, the Treasury, Commerce, and Energy "to take all necessary steps to give effect to the U.S. commitments with respect to sanctions" as described in the JCPOA. Note, however, that Adoption Day itself does not bring any U.S. sanctions relief. The Department of the Treasury’s Office of Foreign Assets Control (OFAC) was careful to issue a statement and FAQ that emphasized this point, cautioning that "[u]ntil Implementation Day is reached, the only changes to the Iran-related sanctions are those provided for in the Joint Plan of Action (JPOA) of November 24, 2013, as extended."
U.S. nuclear-related sanctions only begin to be lifted upon Implementation Day, which occurs when the International Atomic Energy Agency (IAEA) verifies that Iran has met its initial nuclear-related obligations under the JCPOA. Most experts do not expect this to happen until sometime in early- to mid-2016.
For further background on the JCPOA and a summary of the changes set to occur on Implementation Day, please see our July 14, 2015 client alert, "Landmark Nuclear Agreement with Iran Reached."
—————
Adoption Day Statement by President Obama: https://www.whitehouse.gov/the-press-office/2015/10/18/statement-president-adoption-joint-comprehensive-plan-action
Adoption Day Presidential Memorandum: https://www.whitehouse.gov/the-press-office/2015/10/18/presidential-memorandum-preparing-for-implementation-of-the-joint-comprehensive-plan-of-action
OFAC Adoption Day Statement: http://www.treasury.gov/resource-center/sanctions/Programs/Pages/iran.aspx
OFAC Adoption Day FAQ: http://www.treasury.gov/resource-center/sanctions/Programs/Documents/jcpoa_adoption_faqs_20151018.pdf
Gibson, Dunn & Crutcher’s lawyers are available to assist in addressing any questions you may have regarding the above developments. Please contact the Gibson Dunn lawyer with whom you usually work, or the authors in the firm’s Washington, D.C. office:
Judith A. Lee (+1 202-887-3591, [email protected])
Adam M. Smith (+1 202-887-3547, [email protected])
David A. Wolber (+1 202-887-3727, [email protected])
Taylor J. Spragens (+1 202-887-3556, [email protected])
Please also feel free to contact any of the following leaders and members of the International Trade Group:
United States:
Ronald Kirk – Dallas (+1 214-698-3295, [email protected])
Jose W. Fernandez – New York (+1 212-351-2376, [email protected])
Marcellus A. McRae – Los Angeles (+1 213-229-7675, [email protected])
Daniel P. Chung – Washington, D.C. (+1 202-887-3729, [email protected])
Lindsay M. Paulin – Washington, D.C. (+1 202-887-3701, [email protected])
Europe:
Peter Alexiadis – Brussels (+32 2 554 72 00, [email protected])
Attila Borsos – Brussels (+32 2 554 72 10, [email protected])
Patrick Doris – London (+44 (0)207 071 4276, [email protected])
Penny Madden – London (+44 (0)20 7071 4226, [email protected])
Mark Handley – London (+44 (0)207 071 4277, [email protected])
© 2015 Gibson, Dunn & Crutcher LLP
Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.