OFAC clears way for illusory “food and medicine” donations to Iran

June 22, 2011

Open the flood gates.  Fundamentalist Shia charities and leftists can send materials to Iran to their hearts’ content, as long as they claim that they’re sending “food and medicine.”  This creates all kinds of blurry lines whereby individual donors will give zakat or khums to organizations whose leadership or imams will claim is going toward food shipments to Iran.

Senders of aid will not be required to go through any time of licensing or registration process in order to send these supplies.

This will probably lead to direct money transfers to Iran from Muslim Americans who will claim that they have worked out relationships with Iranian food and drug distributors to disperse the items.  Or the guidance could be interpreted as freedom to work with Iran’s bonyads, the quasi-charitable Iranian institutions which are firmly in control of the theocratic elites.

Yet another exemption to the Iranian sanctions policies (like these) could also help relieve pressure on the Iranian regime to reform.  As Iranian expatriates in American begin sending food relief back home, it could reduce the will of Iranian citizens to demand reforms from their government.

The policy could also create a new black market of food and relief supplies similar to what Iraq experienced in the 1990s, where the wrong people invariably end up benefiting.

Normally, new regulations are published in the Federal Register.  This was apparently published only as a PDF flyer.  Moreover, the announcement does not appear to be the result of any formal rule-making process.  No public comment was considered to our knowledge.

From Treasury’s OFAC on June 17:

Donations of food and medicine to Iran and the non-Specified Areas of Sudan, when intended to be used to relieve human suffering, are exempt from the prohibitions of the Iranian Transaction Regulations (“ITR”) and the Sudanese Sanctions Regulations (“SSR”); thus, such donations by U.S. persons do not require an ITR or SSR license issued pursuant to the Trade Sanctions Reform and Export Enhancement Act of 2000 (“TSRA”). However, the commercial exportation or reexportation of food and medicine to Iran and the non-Specified Areas of Sudan is subject to the licensing requirements of TSRA. OFAC generally regards the exportation or reexportation of medical devices, donated or commercial, to be subject to the TSRA and therefore to require a TSRA license. In addition, the donation of funds to a non-US person for the purchase of food, medicine, or medical devices to be exported to Iran or the non-Specified Areas of Sudan would require a license.

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