A merican Club Circular No. 15/1 9 1 MAY 10, 2019 CIRCULAR NO. 15/19 TO MEMBERS OF THE ASSOCIATION Dear Member: THE UNITED STATES EXPANDS THE UNIVERSE OF IRAN SANCTIONS TARGETS (SDNs) BY TARGETING THE METALS SECTOR OF IRAN On May 8, 2019, President Trump issued an Executive Order (EO) targeting the iron, steel, aluminum and copper sectors of Iran. The EO will expand the universe of Specially Designated Nationals (SDNs) of Iran and block the property of and prohibit transactions by US persons or transactions with a US nexus involving SDNs. The EO is available at: https://www.treasury.gov/resource-center/sanctions/Programs/Documents/iran_eo_metals.pdf The FAQs issued by the Office of Foreign Assets Control (OFAC) regarding the EO are available at: https://www.treasury.gov/resource-center/faqs/Sanctions/Pages/faq_iran.aspx#eo_metals Sanctionable activities Persons (individuals and entities), whether or not US persons, may be designated as SDNs if the US government determines that they have engaged in the following activities: 1. To be operating in the iron, steel, aluminum, or copper sectors of Iran, or to be a person that owns, controls, or operates an entity that is part of the iron, steel, aluminum, or copper sector in Iran; 2. To have knowingly engaged, on or after the date of this order, in a significant transaction for the sale, supply, or transfer to Iran of significant goods or services used in connection with the iron, steel, aluminum, or copper sectors of Iran; 3. To have knowingly engaged, on or after the date of the EO, in a significant transaction for the purchase, acquisition, sale, transport, or marketing of iron, iron products, aluminum, aluminum products, steel, steel products, copper, or copper products from Iran; 4. To have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of any person whose property and interests in property are blocked pursuant to this section; or 5. To be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant to the Executive Order. A merican Club Circular No. 15/ 19 2 Under the new EO, which is effective May 8, 2019, shipowners risk being designated as SDNs and losing their ability to do business with the United States or with US persons if they, for example, transfer, or transport to or from Iran significant goods or services (e.g., insurance) used in connection with the iron, steel, aluminum, or copper sectors of Iran, or if they knowingly engage in significant transactions involving the trading to or from Iran of coking coal, iron, iron products, aluminum and aluminum products, steel, and copper. In compliance with the EO, the American Club will not provide coverage for activities sanctionable under the new EO such as, for example, the transportation of iron and iron ore. Foreign financial institutions The EO provides that foreign financial institutions may also be subject to restrictions with respect to opening or maintaining correspondent accounts in the US if it is determined that the foreign financial institution has, on or after the date of the EO, knowingly conducted or facilitated any significant financial transaction: 1. For the sale, supply, or transfer to Iran of significant goods or services used in connection with the iron, steel, aluminum, or copper sectors of Iran; 2. For the purchase,