EghtesadOnline: Governor of the Central Bank of Iran said the corresponding entity to the Special Purpose Vehicle known as INSTEX created by the European Union to enable non-dollar trade with Iran will be registered soon in Tehran.
According to a statement released by the CBI, Abdolnasser Hemmati said creation of the institution does not mean that Iran would "wait upon" Europe to operationalize INSTEX.
"We will continue our strategy to access to finance and trade for our country through neighbors and other trading partners," Hemmati was quoted as saying.
The CBI first greenlighted the mirror entity to INSTEX last month after the global anti-money laundering body decided to extend the suspension of countermeasures against Iran for four more months, recognizing the government’s efforts to accept its Action Plan, according to Financial Tribune.
CBI welcomed FATF's move, hoping that the two remaining bills (part of Iran's Action Plan with FATF) would be finalized soon. The bank said in order to show its goodwill, it will soon introduce the corresponding entity to match the European INSTEX.
INSTEX was launched by the EU on January 30 to shield Iran trade from the new US sanctions announced last year after the hostile US administration walked out of the international nuclear accord it signed with Iran in 2015.
INSTEX president Per Fischer visited Iran last week and met authorities and representatives from France, Germany, Britain, and the EU on how to best implement the payment channel.
A meeting was held between delegations from the Foreign Ministry and relevant bodies and the EU economic and political delegations.
Hemmati referred to the negotiations and said in CBI meetings with Fischer and representatives from the E3, the European team offered full explanation about the Iranian entity.
"We are waiting for action from the European side," Hemmati said.
In a recent talk with the Financial Tribune, the UK trade commissioner to Middle East, Afghanistan and Pakistan Simon Penney said the focus of the technical team comprising E3 and EU officials will be on creating a counterparty mirror entity in Iran.
" This is because we need the two ends of the SPV: one in Europe and one here in Iran and we have heard some encouraging comments around the work that Iran is doing to make sure that the counterparty mirror SPV will be created," he said.
According to the official INSTEX will operate "simplistically on a netting basis" so the idea is to minimize the flow of physical cash or money across the border in and out of Iran and is predicated on having equal debits and credits on both sides.