In keeping with the United States' comprehensive sanctions laws and policies, including the Export-Import Bank Reauthorization Act of 2012 (the “2012 Reauthorization Act”), EXIM Bank performs due diligence on transaction parties in all transactions. In addition, EXIM Bank requires certain transaction participants to provide written certifications and agreements with respect to past and future conduct regarding sanctions. This Fact Sheet summarizes requirements related to Iran sanctions set forth in Section 18 of the 2012 Reauthorization Act (P.L. 112-122). Please note that this Fact Sheet is not a summary of all of EXIM Bank’s due diligence practices or requirements.
Iran Sanctions Activities Certification.
For any transaction that must be approved by EXIM Bank's Board of Directors, Section 18 of the 2012 Reauthorization Act requires that EXIM Bank take certain steps to ensure that the recipients of EXIM Bank’s insurance, guarantees and extensions of credits (loans) are not engaged in certain business activities with Iran. To comply with these requirements, the “Iran Sanctions Activities Certification” must be submitted by each person that is (i) the recipient of the EXIM Bank guarantee or insurance and (ii) the recipient of credit supported by EXIM Bank. The "recipient of the credit" would normally be the borrower or lessee. The person completing the Iran Sanctions Certification must complete it with respect to itself and entities that it owns or controls. The form for the Iran Sanctions Activities Certification, together with Frequently Asked Questions, is available at the following web page: Iran Sanctions Activities Certification.
Please see the form for the relevant definitions used in the Iran Sanctions Activities Certification. In instances where EXIM Bank requires this certification, you may wish to consult legal counsel to ensure that you understand the certification. The required Iran Sanctions Activities Certification must be received before EXIM Bank’s Board of Directors approves the transaction.
Iran Sanctioned Persons.
The 2012 Reauthorization Act also prohibits EXIM Bank from engaging in transactions in which the “recipient of the credit” (generally, the borrower) or its "Controlling Sponsor", is sanctioned under Section 5(a) of the Iran Sanctions Act.[1] You can see a current list of persons sanctioned under Section 5(a) of the Iran Sanctions Act by searching for the program “ISA” on the OFAC Sanctions Search List at: Sanctions List Search (treas.gov). There is currently only one party that is sanctioned under Section 5(a) of the Iran Sanctions Act.
EXIM Bank currently does not require a written certification regarding sanctioned persons.
Additional Sanctions Requirements.
Consistent with U.S. sanctions laws and policies, the actions of the recipient of the credit, its parent and affiliated companies, any guarantors and, in certain transactions, other entities related to the financed project, may affect EXIM Bank and the transaction. Accordingly, EXIM Bank requires each financing agreement to include representations and covenants ensuring compliance with U.S. sanctions laws and a mandatory prepayment provision if at any time the borrower or any guarantor becomes a sanctioned person under any U.S. government sanctions laws or programs, including the Iran Sanctions Act.
[1] See Section 18 of the Export-Import Bank Reauthorization Act of 2012 (P.L. 112-122) for definition of “Controlling Sponsor” and other information on this prohibition.
Updated: May 10th, 2022