EU to take SWIFT measures against Iran

Harsh economic sanctions set to cripple Iranian banks

BRUSSELS (AP) — The European Union is preparing regulations that will shut out Iran’s banks from a major financial clearinghouse used by virtually every country in the world, a senior official said Thursday.

The official, who spoke on condition of anonymity because of European Union rules, said the regulations are currently being worked on, but should be adopted “rather quickly.”

The move is part of an unprecedented escalation of economic pressure by the United States and the EU meant to halt Iran’s suspected drive for nuclear weapons.

The Society for Worldwide Interbank Financial Telecommunication, or SWIFT, said last week it would comply with EU instructions to cut off the Iranian banks once it has clarity on what new rules will require.

SWIFT, which handles cross-border payments for more than 10,000 financial institutions and corporations in 210 countries, must comply with EU regulations because it is an European entity.

The Brussels-based group is an essential way station for international transactions, electronically converting currencies and processing payments such as those for Iran’s crude oil exports

The US government and some US lawmakers also want to see Iran barred from using SWIFT. The Obama administration welcomed last week’s announcement.

The EU official said SWIFT had issued the statement to forestall any possible action against it in the United States.

In January, EU foreign ministers agreed to ban all oil imports from Iran starting next summer. The 27-nation bloc accounts for about 18 percent of Iran’s oil exports.

But the details of how to do this and how to cut payments to Tehran have not yet been worked out, the official said.

“There needs to be a legal basis,” he said. “The decision has not yet been taken because the definitive legal instruments are still being discussed.”