FATF gives Iran until February to implement commitments

After a meeting of its members, the Paris-based international watchdog said Iran had acted on only nine out of 10 of its guidelines despite pledges to make the grade and warned the country that it could face consequences if it fails to act fast.

"We expect Iran to move swiftly to implement the commitments that it undertook at a high level so long ago," the FATF president Marshall Billingslea said after chairing the meeting.

"In line with that, we expect that it will have adopted all of these measures by February. If by February 2019 Iran has not yet done so, then we will take further steps," he added.

The proposed reforms have faced strong opposition in Iran from those who believe that joining the body would open the door to foreign meddling.

The FATF also said it would continue suspending counter-measures, which can go as far as limiting or even banning transactions with a country.

Late in June, the world’s financial watchdog extended a waiver for punitive measures against Iran but set a deadline of October for the country to adopt financial reforms or face consequences.

The FATF is facing US opposition to remove Iran from an economic blacklist despite the steps that Tehran has taken to enact legislation barring terrorist financing and money laundering.

Iran’s removal from the blacklist had gained support in European capitals but a flurry of visits by a top US official to France and other European countries thwarted the bid in February.

Earlier this month, the Iranian Parliament passed a bill on combating the financing of terrorism as part of the country's implementation of international standards set by the FATF.

The combating the financing of terrorism (CFT) bill, one of four put forward by the government to meet FATF demands, was passed by 143 votes to 120. But FATF said it could only consider fully enacted legislation.

To become law, however, Iran's oversight Guardian Council should vet the bill for compliance with the Constitution.

The FATF is a non-government organization founded in 1989 to develop policies to tackle money laundering. In 2001, its mandate was expanded to include fight against terror financing.

European Union foreign policy chief Federica Mogherini said on Thursday that the 28-nation bloc is "working on the concrete establishment of" its plan to set up financial channels to preserve business with Iran and circumvent new US sanctions in place after the United States pulled out of a 2015 nuclear deal in May.

"This is something that we have presented during the [United Nations] General Assembly ministerial week in New York. The Member States of the European Union have decided to put this system in place, so they are now working on the concrete establishment of this. I am confident that they will continue this work in a successful manner in the coming weeks," Mogherini said upon her arrival to the Europe-Asia Meeting (ASEM) Summit in Brussels.

US President Donald Trump announced in May that Washington was pulling out of the nuclear agreement, officially known as the Joint Comprehensive Plan of Action (JCPOA), which lifted nuclear-related sanctions against Tehran in exchange for restrictions on Tehran's nuclear program.

The deal had been signed between Iran and the five permanent members of the UN Security Council -- the United States, Britain, France, Russia and China -- plus Germany in 2015.

The US administration reintroduced the previous sanctions while imposing new ones on the Islamic Republic. It also introduced punitive measures — known as secondary sanctions — against third countries doing business with Iran.

A first round of American sanctions took effect in August, targeting Iran's access to the US dollar, metals trading, coal, industrial software, and auto sector. A second round, forthcoming on November 4, will be targeting Iran's energy sector and financial transactions.