Economic Warfare During a Pandemic? A Legal Analysis of U.S. Sanctions on Iran
The COVID-19 pandemic is a global challenge that requires multilateralism, cooperation among states, for the health of people of all nations. The United States' escalation of a near total economic blockade on Iran is incompatible with the goals of multilateralism. As the sanctions impede Iran's ability to fight COVID-19, the United States is breaching international law under the banner of national security. The 2018 International Court of Justice (ICJ) ruling in Islamic Republic of Iran v. United States of America affirms that regardless of whether the unilateral sanctions constitute an "essential security" measure, they contravene rights guaranteed to Iranians by the 1955 United States-Iran Treaty of Amity. [1] This ruling sets a paradigm for economic warfare cases; it asserts that human rights take precedence over unilateral coercive measures. The United States is now at a crossroads: it can either participate in the multilateral world order and follow its governing norms, or remain a unilateral actor in defiance of international law. Because nations need sufficient financial resources to contain the virus, U.S. sanctions obstruct Iran's ability to protect its citizens' lives. The only multilateral path forward is for the United States to lift its blockade immediately.
By withdrawing in 2018 from the Joint Comprehensive Plan of Action (JCPOA), also known as the Iran Nuclear Deal, and launching its maximum pressure campaign against Iran, the United States has aggravated relations with Iran and transgressed international norms of multilateralism. Without coordinating with its European allies, the United States violated United Nations Security Council (UNSC) Resolution 2231, the unanimous endorsement of JCPOA. [2] In May 2018, the United States unilaterally reimposed nuclear-related sanctions that had been lifted under JCPOA. Three months later, the United States broadened its sanctions regime to include Iran's petroleum, banking, and energy sectors. [3] This escalating sanctions program is a unilateral operation—levied by the United States without cooperation from other states—with extraterritorial effects, wrecking the Iranian economy and effectively barring any company from doing business with Iranian entities. [4]
Combined, the sanctions regime and COVID-19 have devastated the Iranian health infrastructure. [5] Sanctions have obstructed Iran's access to protective equipment, diagnostic kits, and other medical supplies. [6] In March, the United Nations High Commissioner called for states to ease or suspend sanctions that may affect the health sector because "impeding medical efforts in one country heightens the risk for all of us." [7] The U.S. Office of Foreign Assets Control (OFAC) has asserted that the sanctions against Iran exempt humanitarian goods. In practice however, humanitarian exemptions do not sufficiently provide Iran with urgently needed goods. [8] Products such as oxygen generators, face mask respirators, and diagnostic medical imaging equipment must be approved by OFAC on a case-by-case basis because they are considered “dual-use”— civilian items with potential to be repurposed for military use. [9] This ineffective authorization process delays and freezes shipments. Furthermore, secondary sanctions on third parties that trade with Iran deter foreign banks from pursuing humanitarian transactions with the country. [10]
By restricting Iran's trade with foreign entities and its access to essential goods, U.S. sanctions exert authority beyond U.S. territory and directly interfere with Iran's internal processes; they have extraterritorial effects. Legal scholars have interpreted unilateral sanctions with extraterritorial effects to be a violation of the non-intervention principle of the UN, which prohibits interference in matters within the "domestic jurisdiction of any state." [11] [12] In line with the principle of non-intervention, the United Nations General Assembly declared in 1965 that "no State may use or encourage the use of economic, political or any other type of measures to coerce another State in order to obtain from it the subordination of the exercise of its sovereign rights." [13] Further, the United Nations General Assembly Resolution 74/154 holds that unilateral coercive measures are contrary to international humanitarian law. [14] A closer look at the 2018 ICJ Ruling Iran v. United States sheds insight into the legal dimensions of these unilateral sanctions.
In July 2018, Iran filed a claim before ICJ for the United States’ alleged violations of the 1955 Treaty of Amity, Economic Relations, and Consular Rights. Signed before the Iranian Revolution, the Treaty of Amity established friendly relations between the United States and Iran authorizing ICJ jurisdiction over disputes that involve the "interpretation or application" of the Treaty, and are "not satisfactorily adjusted by diplomacy." [15] Iran argued that the reinstatement of U.S. sanctions violated rights guaranteed to Iranians by the Treaty of Amity. For instance, the Treaty prohibits restrictions on the making of payments and transfers of funds to or from Iran and also prohibits any discriminatory treatment of Iranian nationals or companies. [16] [17] The United States claimed that ICJ did not have jurisdiction over this dispute because the dispute falls out of the bounds of the Treaty. According to the United States, the reimposition of sanctions was a national security decision allowed under the “essential security” provision of the Treaty. [18] [19] Ultimately, however, ICJ ruled in favor of Iran. Holding that the national security provision does not affect certain rights, including the right to humanitarian goods, ICJ ordered the United States to remove "any impediments" to the exportation of humanitarian goods to Iran. [20] [21] This ruling is the first time international judges ruled over a case regarding economic warfare. [22]
In response, the United States insisted that its sanctions regime against Iran already exempts humanitarian goods. Instead of easing sanctions, the United States immediately withdrew from the Treaty of Amity. [23] Secretary of State Mike Pompeo denied the ICJ jurisdiction and refused to work with international arbitration bodies. [24] Though ICJ lacks a means of enforcing compliance, Iran v. United States is a landmark ruling which sets a precedent for ruling over economic sanctions. According to legal scholar Marcin J. Menkes, ICJ found itself trying to strike a "fragile equilibrium between respecting a state’s right to its security and preventing the very same norm from becoming a device for destroying the legal system it is supposed to stabilize." [25] In other words, ICJ affirmed that "national security" interests do not negate the United States' liability for violations of international laws and treaties that it has signed onto. The ruling could significantly alter international debate about sanctions. It highlights the illegality of unilateral coercive measures that restrict a state's ability to provide for its citizens. Since the ruling, European countries have attempted to work around U.S. sanctions using the EU-Iran In Support of Trade Exchanges (INSTEX) mechanism, which facilitates humanitarian trade between Iran and five European countries. [26] If international bodies follow ICJ's precedent and rule in favor of states targeted by unilateral U.S. sanctions, the international consensus on sanctions will continue to shift towards multilateralism: states should pursue multilateral trade to counteract economic warfare that takes its greatest toll on ordinary citizens.
This March, urging the Group of Twenty (G20) members to waive sanctions, the United Nations Secretary General wrote, "This is the time for solidarity, not exclusion." [27] In order to prevent all international responsibilities from becoming merely symbolic, the United States must lift sanctions on Iran. The ICJ ruling reveals that national security cannot come at the cost of Iran's basic sovereignty and rights. The COVID-19 pandemic makes the lifting of sanctions even more necessary and urgent.
[1] Islamic Republic of Iran v. United States of America, 4 (International Court of Justice 2018).
[2] Marcin J Menkes, "Legality of US Investment Sanctions against Iran before the ICJ: A Watershed Moment for the Essential Security and Necessity Exceptions," 56 Canadian Yearbook of International Law 328, 331 (2019).
[3] Statement From the President on the Reimposition of United States Sanctions With Respect to Iran, United States Office of the Press Secretary (2018), online at https://www.whitehouse.gov/briefings-statements/statement-president-reimposition-united-states-sanctions-respect-iran/ (visited August 13, 2020).
[4] Frequently Asked Questions Regarding the Re-Imposition of Sanctions Pursuant to the May 8, 2018 National Security Presidential Memorandum Relating to the Joint Comprehensive Plan of Action (JCPOA), United States Department of the Treasury (2018), online at https://www.treasury.gov/resource-center/sanctions/programs/documents/jcpoa_winddown_faqs.pdf (visited August 13, 2020).
[5] Maximum Pressure: US Economic Sanctions Harm Iranians' Right to Health, Human Rights Watch (2019), online at https://www.hrw.org/report/2019/10/29/maximum-pressure/us-economic-sanctions-harm-iranians-right-health (visited August 13, 2020).
[6] Erin Cunningham, As coronavirus cases explode in Iran, U.S. sanctions hinder its access to drugs and medical equipment, Washington Post (2020), online at https://www.washingtonpost.com/world/middle_east/as-coronavirus-cases-explode-in-iran-us-sanctions-hinder-its-access-to-drugs-and-medical-equipment/2020/03/28/0656a196-6aba-11ea-b199-3a9799c54512_story.html (visited August 13, 2020).
[7] Bachelet Calls For Easing of Sanctions to Enable Medical Systems to Fight COVID-19 and Limit Global Contagion, Office of the High Commissioner of Human Rights (2020), online at https://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=25744&LangID=E (visited August 13, 2020).
[8] Human Rights Watch, US: Ease Sanctions on Iran in COVID-19 Crisis, Human Rights Watch (2020) online at https://www.hrw.org/news/2020/04/06/us-ease-sanctions-iran-covid-19-crisis# (visited August 13, 2020).
[9] Iranian Transactions and Sanctions Regulations: List of Medical Devices Requiring Specific Authorization, United States Office of Foreign Assets Control (2017), online at https://www.treasury.gov/resource-center/sanctions/Programs/Documents/iran_gl_med_supplies.pdf (visited August 13, 2020).
[10] Sina Azodi, How US Sanctions Hinder Iranians' Access to Medicine, Atlantic Council (2019), online at https://www.atlanticcouncil.org/blogs/iransource/how-us-sanctions-hinder-iranians-access-to-medicine/ (visited August 13, 2020).
[11] Rahmat Mohamad, "Unilateral Sanctions in International Law: A Quest For Legality" in Economic Sanctions Under International Law, edited by Ali Marossi and Marisa Bassett, 77-81. The Hague: Asser Press, 2015.
[12] United Nations, Charter of the United Nations, San Francisco: United Nations, 1945. Online, https://treaties.un.org/doc/publication/ctc/uncharter.pdf (visited August 14, 2020).
[13] United Nations General Assembly, General Assembly Resolution 20/2131, Declaration on the Inadmissibility of Intervention in the Domestic Affairs of States and the Protection of Their Independence and Sovereignty, New York: United Nations, 1965. https://www.ilsa.org/Jessup/Jessup15/Declaration%20on%20the%20Inadmissibility%20of%20Intervention%20in%20the%20Domestic%20Affairs%20of%20States%20and%20the%20Protection%20of%20Their%20Independence%20and%20Sovereignty.pdf (visited August 14, 2020).
[14] United Nations General Assembly, General Assembly Resolution 74/154, Human rights and unilateral coercive measures, New York: United Nations, 2019. https://digitallibrary.un.org/record/3848696?ln=en (visited August 14, 2020).
[15] "Treaty of Amity, Economic Relations, and Consular Rights Between The United States of America and Iran," signed August 15, 1955, online at https://www.state.gov/wp-content/uploads/2019/05/Treaty-of-Amity-Economic-Relations-and-Consular-Rights-between-the-United-States-of-America-and-Iran-Aug.-15-1955.pdf (visitedAugust 14, 2020).
[16] id at Article VII, paragraph 1
[17] id at Article IV, paragraph 1
[18] Islamic Republic of Iran v. United States of America, p. 4 (ICJ 2018).
[19] Marcin J Menkes, "Legality of US Investment Sanctions against Iran before the ICJ: A Watershed Moment for the Essential Security and Necessity Exceptions," 56 Canadian Yearbook of International Law 328, 349 (2018).
[20] Elena Chachko, What to Make of the ICJ's Provisional Measures in Iran v. U.S. (Nuclear Sanctions Case), Lawfare Blog (2018), online at https://www.lawfareblog.com/what-make-icjs-provisional-measures-iran-v-us-nuclear-sanctions-case (visited August 13, 2020).
[21] Islamic Republic of Iran v. United States of America, 6 (ICJ 2018).
[22] Top UN Judicial Body Orders U.S. To Ease Iran Sanctions, UN News (2019), online at https://news.un.org/en/story/2018/10/1022142 (visited August 3, 2020).
[23] Edward Wong and David E. Sanger, U.S. Withdraws From 1955 Treaty Normalizing Relations With Iran, New York Times (2019), online at https://www.nytimes.com/2018/10/03/world/middleeast/us-withdraws-treaty-iran.html (visited August 3, 2020).
[24] id
[25] Marcin J Menkes, "Legality of US Investment Sanctions against Iran before the ICJ: A Watershed Moment for the Essential Security and Necessity Exceptions," 56 Canadian Yearbook of International Law 328, 349 (2018).
[26] Chase Winter, What is the EU-Iran Payment Vehicle INSTEX?, Deutsche Welle (2019), online at dw.com/en/what-is-the-eu-iran-payment-vehicle-instex/a-47306401 (visited August 3, 2020).
[27] António Guterres, Note to Correspondents: Letter from the Secretary-General to G-20 Members, United Nations Secretary-General (2020), online at https://www.un.org/sg/en/content/sg/note-correspondents/2020-03-24/note-correspondents-letter-the-secretary-general-g-20-members (visited August 13, 2020).