Iran Sanctions: Primary, Secondary, and JCPOA Snapback
How U.S. primary and secondary sanctions on Iran interlock with the JCPOA's snapback mechanism, E.O. 13902, and extraterritorial enforcement.
The Primary Sanctions Layer
U.S. primary sanctions on Iran form the densest country-program architecture OFAC administers. The foundation is the Iranian Transactions and Sanctions Regulations (ITSR), 31 C.F.R. Part 560, which implements Executive Order 12959 (May 6, 1995) and Executive Order 13059 (August 19, 1997). These instruments prohibit virtually all transactions between U.S. persons and Iran, including the supply of goods, services, or technology, and impose a general embargo extending to Iranian-origin goods. The ITSR's reach is broadened by the definition of "U.S. person" at 31 C.F.R. § 560.314, which captures U.S. citizens, permanent residents, entities organized under U.S. law (including foreign branches), and any person physically in the United States.
Layered atop the ITSR is a dense thicket of statutory authorities. The Iran Sanctions Act of 1996 (ISA, originally the Iran-Libya Sanctions Act) targets investment in Iran's petroleum sector. The Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA) expanded the menu of sanctionable activities and introduced correspondent-account restrictions on foreign banks dealing with designated Iranian persons (Section 104). The Iran Threat Reduction and Syria Human Rights Act of 2012 (ITRSHRA) and the Iran Freedom and Counter-Proliferation Act of 2012 (IFCA, codified at 22 U.S.C. §§ 8801–8811) extended sanctionable conduct to energy, shipping, shipbuilding, ports, and precious metals.
Executive Orders and the SDN List
The operational instrument is the Specially Designated Nationals and Blocked Persons (SDN) List. Iran-related designations rest on a stack of executive orders: E.O. 13224 (counterterrorism, September 23, 2001), E.O. 13382 (proliferation, June 28, 2005), E.O. 13553 (Iranian human rights abuses, September 28, 2010), E.O. 13606 (the "GHRAVITY" order on grave human rights abuses via information technology, April 22, 2012), and E.O. 13599 (February 5, 2012), which blocks the property of the Government of Iran and Iranian financial institutions. The Islamic Revolutionary Guard Corps was designated under E.O. 13224 on April 8, 2019 — the first time the United States designated a component of a foreign government as a Foreign Terrorist Organization under 8 U.S.C. § 1189.
The centerpiece of the current pressure architecture is Executive Order 13902 (January 10, 2020), issued after the Soleimani strike. It authorizes blocking sanctions on any person operating in Iran's construction, mining, manufacturing, or textiles sectors, and crucially extends to foreign financial institutions that knowingly conduct or facilitate significant transactions for sale, supply, or transfer of goods or services to or from those sectors. E.O. 13902 thereby fuses primary-jurisdiction conduct rules with extraterritorial banking exposure.
The 50 Percent Rule and General Licenses
Two doctrines govern day-to-day compliance. First, OFAC's 50 Percent Rule (most recently restated in the August 13, 2014 guidance) blocks any entity owned 50 percent or more, directly or indirectly, in the aggregate by one or more SDNs. For Iran this is consequential because the IRGC, NIOC, and IRISL hold sprawling subsidiary networks. Second, OFAC issues General Licenses authorizing narrow categories of otherwise-prohibited activity: GL D-2 (telecommunications and personal communications, updated May 25, 2022, then May 19, 2023), GL 8 (humanitarian transactions involving the Central Bank of Iran), and the agricultural-and-medical licensing framework under the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA). Compliance officers screen against the SDN List, the Non-SDN Iran Sanctions Act List (NS-ISA), and the Foreign Sanctions Evaders List, then map proposed conduct against the active GLs.