CIRCULAR 11/13 11th July 2013 TO ALL MEMBERS,
Currently, under the Club Rules, there is no right of recovery for any claim if it arises out of or is consequent upon the insured vessel being engaged in any activity that exposes the Club to any sanctions, prohibition or restrictions under United Nations resolutions, sanction laws or Regulations of the European Union, United Kingdom or United States of America.
In addition, and as a consequence of the Iran Freedom and Counter-Proliferation Act 2012 (IFCA) which came into effect on 1st July 2013, insurers are prohibited from providing cover to any vessel which is engaged in a sanctioned activity as defined within the Act.
Therefore Club cover will no longer respond to a claim where the entered vessel is engaged in a sanctioned activity as the cover will automatically cease at the commencement of the sanctioned activity.
Members who are currently operating in Iran, considering doing so, or are contracted out to Iranian charterers or principals, must advise the Club through their broker or usual contact at the Club. The Club will require details of due diligence that has been carried out by you to ensure that the vessel is not engaged in any activities outlined in IFCA, i.e. activities with:
- Any persons connected with or for the benefit of any activity in the energy, shipping or shipbuilding sectors of Iran;
- Any persons connected with the sale, supply, or transfer to or from Iran of the precious metals and raw materials;
- Any persons connected with Iran’s proliferation of weapons of mass destruction or support for international terrorism;
- Any individual on the Specially Designated Nationals List (SDN).
In addition, the Club will require evidence to support the conclusion that has been reached as a result of the Member’s own due diligence or relevant evidence of any waiver or licence issued by the US State Department permitting the activity.
For further information Members are referred to NDAA 2013: A Potential Expansion of US Sanctions against Iran as at July 1, 2013 10/13.
Additional information on the Act can also be found on the International Group website (www.igpandi.org) and the Office of Foreign Asset Control (OFAC) website (www.treasury.gov/ofac).
We strongly encourage all Members to undertake due diligence in order to satisfy themselves that they do not expose their operations or the Club to sanctions, prohibitions or restrictions under United Nations resolutions, sanction laws or Regulations of the European Union, United Kingdom or United States of America.