* Swiss postpone decision on EU oil embargo
* Oil traders seen as potential beneficiaries
* Govt. adds eleven new names to Iran blacklist
* Exempts Iran's central bank from asset freeze
By Emma Farge
GENEVA, April 18 Switzerland on Wednesday left a
loophole open as sanctions tighten against Iran, that may let
Swiss-based oil trading companies evade a European Union ban on
trading Iranian oil.
The Swiss Economics Ministry said it would make a decision
on the EU's ban on the importation, purchase or shipping of
Iranian oil, at a "later date", without giving specifics.
The EU embargo bans all new oil contracts with Iran and is
due to take full effect for existing contracts from 1 July.
While Switzerland does not directly import Iranian oil, the
Swiss position on the EU oil embargo could impact the activities
of oil companies based in the trading hubs of Geneva and Zug.
The EU has gradually tightened financial restrictions on
Iran and on Jan. 23 agreed to phase in an oil embargo and to
freeze the assets of Iran's central bank in an effort raise
pressure on Tehran over its disputed nuclear programme.
Tehran says it is a purely civilian programme, while the
West suspects it is aimed at making weapons.
The postponement of a decision on EU oil trading
restrictions means that Swiss-based traders could in theory
continue buying and selling Iranian oil after July, although
industry sources say sanctions make funding difficult.
Top oil traders Vitol and Glencore said they were
complying with sanctions on Iran but both companies declined to
give further comment about whether complying with sanctions
meant following EU or Swiss regulations.
Geneva-based Gunvor declined to comment and Trafigura was
not immediately available for comment.
Matthew Parish, partner at Geneva-based law firm Holman
Fenwick Willan, said he does not expect Bern to pass measures
restricting the activities of oil trading companies.
"I don't see the Swiss government hobbling their country's
own competitive advantage by creating a sanctions regime that
deprives Switzerland-based traders of the light regulatory
touch," he said.
"One of the reasons Switzerland has apparently overtaken
London in terms of the volume of oil traded is due to the
relative absence of regulatory and financial restrictions on
The Swiss-based service company for the National Iranian
Oil Company NICO which is responsible for oil trading and energy
investment activities did not immediately respond to an emailed
request for comment.
The Swiss Economics Ministry, which oversees sanctions
policy, also said in the statement that the country would not
follow the EU in freezing the assets of the Iranian central bank
"due to its importance for the Iranian economy".
It did however add eleven new entities to its blacklist,
freezing their assets, in a decision taking effect on Tuesday.
A European diplomatic source familiar with Bern's position
said that Switzerland shared some of the EU's concerns about
Iran but was worried about jeapordising its traditional role as
a go-between for Tehran and Washington.
He added that Bern showed similar reluctance to introduce an
earlier wave of EU sanctions against Tehran last year.
As a neutral intermediary, non-EU Switzerland has
represented U.S. interests in Iran since 1980 following the
Islamic revolution in 1979.
Switzerland is only bound to enforce U.N. Security Council
decisions on a national level, although in recent years it has
tended to copy EU sanctions to harmonise its laws with those of
its main trading partners.
The Federal Council took the decision at a meeting on April
4, before world powers met Tehran negotiators for talks in
Istanbul at the weekend on Iran's nuclear programme.