INTA Bulletin

November 1, 2015 Vol. 70 No. 19 Back to Bulletin Main Page

IRAN: Sanctions and Considerations for Rights Holders

After months of diplomatic negotiations, Iran and the “P5+1” (the United Kingdom, the United States, France, Russia, China and Germany) reached agreement on July 14, 2015, on the Joint Comprehensive Plan of Action (JCPOA).

With U.S. congressional support for the JCPOA now secure, implementation of the respective obligations under the JCPOA commenced on October 18, 2015. Once there is independent verification that Iran has complied with its obligations, the relevant EU and U.S. sanctions will be lifted, enabling Iran to partially reintegrate into the global community. This is expected to occur in late 2015 or early 2016.

The pending implementation of the JCPOA provides a significant opportunity for rights holders. With a population of 80 million and an economy valued at USD 420 billion, Iran is a significant consumer market in the Middle East.

IP rights owners are not prohibited from protecting and enforcing their IP rights in Iran by the EU and U.S. sanctions regime. These permitted transactions are subject to the prohibition on any dealing with or the transfer of any funds to specifically “designated persons.” Accordingly, by way of example, no payments should be made to the accounts of any specifically designated persons regardless of whether the funds relate to the protection or enforcement of IP rights.

The Impact for Rights Holders
IP rights owners planning to enter, or re-enter, Iran should be prepared for the challenges which may lie ahead. To help with such challenges, the following steps should be considered:
  • Identifying and complying with any sanctions obligations which may still be applicable to the company both pre- and post-implementation day;
  • Reviewing IP protection in Iran, if any, and putting in place appropriate protection and/or filling potential gaps in protection as necessary;
  • Conducting searches to determine whether any potentially conflicting third-party rights exist on the IP rights registers (as some international brands may have been misap-propriated during the sanctions regime);
  • Conducting searches of the .ir ccTLD for potentially conflicting domain names and taking appropriate action as necessary;
  • Carrying out market research to see whether infringing and/or counterfeit products/businesses are already on the market in Iran and to take action to deal with such issues as necessary;
  • When looking at local partners/potential partners, conducting appropriate due diligence to ensure that the companies/individuals are not listed on the “designated persons registers” maintained by national governments in the EU and United States; and
  • Reviewing any pre-sanctions contracts that may exist in order to ensure that none of the terms may be breached if the company re-enters the Iranian market with a new partner.
The sanctions relief will bring significant changes to the investment in Iran over time as the relief is implemented in stages subject to Iran’s compliance with the steps of the JCPOA.
In the meantime, businesses with interests in Iran should continue to comply with EU or U.S. sanctions to avoid serious penalties, and take steps to ensure that appropriate protection is in place for when they are able to do business there.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.

© 2015 International Trademark Association