Iran sanctions mean closer scrutiny for multinationals

U.S. policy toward Iran is proving to be the principal foreign policy issue of the 2012 election season. With an ever-expanding sanctions regime focused on Iran — and now Syria, too — companies operating internationally do so in an atmosphere of increasing legal and reputational risk. Now is therefore a good time for companies to assess the adequacy of their compliance programs.

In the Oval Office and on the Republican presidential campaign trail, Iran dominates the discussion. President Barack Obama urges diplomacy, with limits. Republican front-runner Mitt Romney has identified his primary foreign policy objective as stopping Iran’s alleged nuclear-weapons program, and criticizes President Obama for having taken a conciliatory approach. Meanwhile, Congress has taken the initiative by expanding the existing U.S. sanctions regime against Iran. The president has taken his initiatives principally on the diplomatic front, both at the United Nations, which imposed broader sanctions in 2010, and also by persuading U.S. allies to broaden their own sanctions regimes. For example, the European Union and Canada have imposed significant sanctions that target Iran’s financial and energy sector, with the recently announced E.U. oil embargo being perhaps the most notable measure.