Can We Still Legally Fly on Iran Air?

By Farhad Alavi and Babak Hoghooghi

Note: this article is also available on the website of the Public Affairs Alliance of Iranian-Americans (PAAIA).  Click here.

The designation on June 23 of Iran Air and its affiliates on the Specially Designated Nationals (SDN) List by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) is baffling many in the Iranian American community, and naturally leading to legitimate questions.  This article provides basic answers and will hopefully address and allay some of the community’s concerns.

Under the U.S. sanctions regime against Iran (31 CFR Parts 560 and 544) “U.S. Persons” are, subject to certain limited exceptions, generally prohibited from dealings related to Iran, and particularly with entities on the SDN list.  Such prohibitions are rather broad and include restrictions on engaging in transactions or dealings in or related to goods and services by entities on the SDN list.  The Iranian Transactions Regulations (31 CFR 560) (ITR) defines “U.S. Persons” as U.S. citizens and permanent residents, wherever located, persons physically in the United States (such as students and tourists), and U.S. entities and their foreign branches.

Now back to Iran Air.  Let’s say you are planning a trip to Iran this summer, and want to make a weekend sojourn to Esfahan, booking a round-trip ticket from Tehran on Iran Air.  Given last week’s news, you may be panicking or at least wondering whether your trip may get you in trouble with U.S. authorities.  Such legitimate concerns have been exacerbated by certain instances of misinformation and misunderstandings circulating in the Iranian-American community.  In addition to the oft-made claim that travel on Iran Air is now prohibited, some have gone as far as suggesting that individuals flying on Iran Air will not be able to reenter the United States and will be prosecuted.

So what is current U.S. law relating to Iran Air?  Even before being placed on the SDN list, nearly all dealings between U.S. Persons and Iran Air or its affiliates in Iran were illegal.  For example, U.S. Persons were and continue to be generally prohibited from investing in or lending to entities in Iran, including Iran Air, as well as selling or supplying goods, technologies or services to them.  Therefore, the sale of insurance or provision of on-board catering services by U.S. Persons to Iran Air has long been illegal absent specific authorization.

By virtue of its recent designation on the SDN list, such restrictions against Iran Air are now expanded to include, among other things, dealings with Iran Air’s affiliates outside Iran and the blocking of its assets in the U.S. or in the possession of U.S. Persons.  In fact, very broadly speaking and subject to a few narrow exceptions, U.S. Persons are now prohibited from engaging in any transaction or dealing with Iran Air.

Nonetheless, you can still purchase tickets and travel to Esfahan (or elsewhere) on Iran Air without violating U.S. laws.  The U.S. sanctions regime in place against Iran, as applicable to entities on the SDN list or otherwise, includes the so called “travel” exception (31 CFR 560.210(d) and 544.206(c)).  Under the travel exception, the foregoing broad prohibitions “do not apply to transactions ordinarily incident to travel to or from any country, including importation of accompanied baggage for personal use … and acquisition of goods or services for personal use, and arrangement or facilitation of such travel including nonscheduled air, sea, or land voyages.”

Accordingly, U.S. Persons may continue to purchase tickets and fly on Iran Air’s domestic or international flights as long as such travel is for personal purposes.  Nevertheless, given the increasing scope and complexity of U.S. sanctions against Iran, we urge Iranian Americans and their families to be mindful of these laws and diligent in all their dealings relating to Iran.

This article is intended to generally inform the public of applicable regulations relating to travel with Iran Air, and should not be regarded as legal advice.  If you have any questions or plan to engage in any transactions relating to Iran, you should seek the advice of qualified counsel.

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Babak Hoghooghi and Farhad Alavi are attorneys practicing in Washington, D.C., and partners at BHFA Law Group (202-730-1271; info@bhfalaw.com). 

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