BRUSSELS  - EU countries on Monday gave European firms legal cover to operate in Iran despite the US pullout from the nuclear deal, after a report that the Trump administration has rejected calls by Brussels for an exemption from sanctions.

The bloc's foreign policy chief Federica Mogherini said the 28 countries were doing all they could to save the deal but conceded President Donald Trump's administration could still wreck it.

US President Donald Trump withdrew from the Iran nuclear deal in May, and Washington now plans to reimpose sanctions on Tehran next month.

"Today, the (European) Council has endorsed the update of the blocking statute annex on the nuclear deal with Iran," Mogherini told reporters in Brussels at a meeting with EU foreign ministers.

She said the European Parliament gave its consent to the statute two weeks ago.

The "blocking statute" forbids EU firms from complying with US sanctions, allowing them to recover damages from such penalties and nullifying any foreign court rulings against them.

The EU vowed to fight to preserve the Iran nuclear deal after the US withdrawal, one of many points of US-European contention.

The blocking statute is due to enter force on August 6, when the first set of US sanctions are due. The second set is due November 4, just before US legislative elections.

The move came as the Financial Times reported that the Trump administration has rejected an EU call for an exemption from US sanctions on companies operating in Iran.

Mogherini conceded it will be tough battle to preserve the Iran nuclear agreement, which Trump's predecessor Barack Obama sealed with Iran along with Britain, France and Germany as well as Russia and China.

"It is a difficult exercise, because the weight of the US in the global economy and the financial system is obviously relevant," the former Italian foreign minister said.

French carmaker Renault, which does not sell cars in the US, has said it will remain in Iran despite the sanctions. But French oil group Total and carmaker PSA have already indicated they are likely to pull out of Iran.

Mogherini said the EU and other parties were "determined to preserve this deal" she called vital to European, Middle Eastern and global security.

"We will continue to do all we can to try and prevent this deal from being dismantled because we believe the consequences of this would be catastrophic for all." But she added she was not sure the "efforts are going to be enough."

EU leaders and top diplomats urged US President Donald Trump to protect the world order at his summit on Monday with Vladimir Putin and dismissed his assertion that Europe was a US trade foe.

Trump triggered fresh concerns from European Council President Donald Tusk at an EU-China summit in Beijing, and from EU foreign ministers in Brussels, one of whom urged the US president to stand up for non-EU Ukraine and Georgia against Russia.

Trump said the European Union was a foe in trade while also calling Russia and China foes in some respects, before his summit with Russian President Vladimir Putin in Helsinki.

"America and the EU are best friends. Whoever says we are foes is spreading fake news," Tusk tweeted late Sunday from Beijing, without naming Trump directly.

Trump often uses the term "fake news" when he disagrees with news reports.

"Europe and China, America and Russia, today in Beijing and in Helsinki, are jointly responsible for improving the world order, not for destroying it," Tusk said in a separate tweet. "I hope this message reaches Helsinki," the former Polish premier added.

The Trump administration has slapped tariffs on steel and aluminium imports from Europe as well as on products from Mexico, Canada and China, sparking retaliation and fears of a global trade war.

Tusk warned in Beijing that trade tensions could spiral into a "hot conflict."

 

Washington will not budge on its decision to impose fresh sanctions on corporations operating in Iran, despite a European request for exemption, the Financial Times reported Monday.

"International companies active in Iran face the threat of US sanctions within weeks after Washington rebuffed a high-level European plea to exempt crucial industries to help keep a landmark nuclear deal with Tehran alive," the paper reported.

France, Britain, Germany and the European Union had on June 6 sent US President Donald Trump's administration a joint official request for their companies to be exempt from the fresh US sanctions on Iran.

The plea had come as European leaders scrambled to save the hard-fought deal signed between Iran and world powers in 2015 under which Tehran agreed to limit its nuclear capacities in exchange for relief from crippling economic sanctions.

Trump announced he was abandoning the deal in May - paving the way for new sanctions on the Islamic republic and punitive measures for those who trade with it.

In a formal letter, US Secretary of State Mike Pompeo and Treasury Secretary Steve Mnuchin refused to grant the European powers the waiver they had asked for, the Financial Times reported Monday, citing diplomats.

French Economy Minister Bruno Le Maire had already said the United States would not grant Europe its request.

"I wrote in the springtime to Steve Mnuchin ... to ask him for an exemption for European companies legally working in Iran," Le Maire said according to an interview with French newspaper Le Figaro that was published Friday.

Failing an outright exemption, Le Maire had also asked for more time before the sanctions regime was due to kick in.

"We have just received the answer, and it's negative," he said.

Washington's refusal came as Trump called Europe a foe in trade and renewed accusations that the EU was taking advantage of the United States.

Analysts say European firms which have rushed to invest in Iran after the lifting of sanctions over the past three years have the most to lose from the renewed sanctions.

 

 

 

 

AFP