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Why does US want Iran’s vaccine payments to pass through its banks?

In theory, medicines are exempt from the sanctions, but in reality, international banks tend to turn down transactions involving Iran to avoid being exposed to potential litigation.

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President Hassan Rouhani said on Saturday that Washington was demanding Iranian transactions for novel coronavirus vaccines pass through US banks, and expressed fear the money could be seized.

US President Donald Trump has imposed wave after wave of sanctions on the Islamic republic since 2018 when he unilaterally withdrew from the Iran nuclear deal.

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Iran has assets frozen in several countries, including in the US.

“We want to transfer money from a country where our money is” to buy the vaccine and “this country has accepted”, Rouhani said during a meeting of Iran’s coronavirus task force, without identifying the country in question.

In theory, medicines are exempt from the sanctions, but in reality, international banks tend to turn down transactions involving Iran to avoid being exposed to potential litigation.

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The US Treasury’s Office of Foreign Assets Control had initially indicated that “it didn’t have a problem” with such a transfer of funds, he said.

But “it said later that the money had to first pass through a US bank before being transferred” for the vaccine purchase, Rouhani said.

In April, the Iranian president said the country had won a legal “victory” over $1.6 billion of its assets that had long been frozen on a US request in Luxembourg.

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“Who can trust people like you? You have stolen our money everywhere you found it,” Rouhani said Saturday, addressing the US administration.

The Islamic republic has been battling the Middle East’s deadliest outbreak of the novel coronavirus since February, with almost 1,195,000 cases and over 54,500 deaths, according to official figures.

Health Minister Saeed Namaki said early this month that Iran had “pre-purchased” about 16.8 million vaccine doses “via COVAX”, without specifying which vaccine.

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COVAX is an international initiative that aims to ensure equitable access to coronavirus vaccines for all countries.

The vaccine purchase “could be more costly and be delayed, but it will certainly happen”, Rouhani said Saturday.

Iran has also called for volunteers for the start of clinical trials for its own vaccine, which it began to develop in the spring, the health ministry said.

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