May 12, 2015 | Forbes

Iran Shipping Sanctions Run Aground?

Officially, the Obama administration remains committed to enforcing sanctions on Iran’s main merchant shipping fleet, the Islamic Republic of Iran Shipping Lines, also known as IRISL. But in practice, since the Iran nuclear talks began early last year, many of IRISL’s cargo ships appear to be operating ever more freely, with fading protest from Washington.

Take the case of a container ship named the Azargoun, a vessel blacklisted by the U.S. Treasury since 2008 as belonging to IRISL’s fleet. After years of sanctions-dodging subterfuge, including reflagging, renaming and a series of shell company registered owners, not only has the Azargoun reflagged back to Iran, but it is steaming ever more boldly abroad — including a recent visit to Iran’s closest ally in the Western hemisphere, Venezuela.

Under Iran’s flag, according to data on Lloyd’s List Intelligence shipping database, the Azargoun is now completing a return voyage from Venezuela to Iran — including a transit earlier this week through the Suez Canal, from the Mediterranean into the Red Sea. As of this writing, the ship is steaming past Saudi Arabia toward the waters off war-wracked Yemen, where U.S. warships have been trying to shut down Iran’s efforts to resupply the Houthi rebels who in January toppled Yemen’s U.S.-backed government.

Is there any potential problem here? For lack of publicly available information about what cargo the Azargoun might be carrying, let us assume its freight is legitimate and its mission humane. Nonetheless, this voyage of the Azargoun ought to raise serious questions about what’s going on with U.S. sanctions enforcement against blacklisted Iranian ships.

U.S. sanctions on IRISL were not frivolously imposed. Back in 2008, when the U.S. added IRISL, a number of its affiliated entities and well over 100 of its cargo ships to Treasury’s blacklist of Specially Designated Nationals (also known as the SDN list), Treasury in a press release alleged that IRISL was involved in illicit commerce, including “military-related cargo” and the provision of services to Iran’s nuclear and ballistic missile programs.

IRISL responded to sanctions, according to an Oct. 27, 2011 Treasury press release, not by changing its conduct, but by trying to change its identity. In that same 2011 press release, Treasury described its global efforts to shut down IRISL’s traffic, stating “Wherever IRISL has gone, we have tracked and exposed them.” Treasury stressed that the U.S., with the cooperation of the international community, was succeeding in “imposing a widening array of powerful sanctions against this dangerous carrier.” Warning that “IRISL’s day’s may be numbered,” Treasury titled this press release: “No Safe Port for IRISL.”

To visible effect, globetrotting Treasury officials were then working overtime to persuade other nations to shun IRISL, warning of IRISL’s “deceptive practices,” including “fabricated vessel registration and flag credentials.” IRISL was hard at work trying to camouflage its blacklisted ships behind a welter of foreign flags, new names and networks of overseas front companies. To identify the vessels required a focus on their unique seven-digit hull numbers, or IMO numbers, issued under authority of the International Maritime Organization for the life of each ship (which is the basis on which ships are identified in this article).

By 2012, IRISL’s blacklisted fleet appeared confined largely to the Middle and Far East. IRISL’s once-frequent port calls to Europe and Latin America — including Mexico and Venezuela — had almost entirely dried up.

That trend is now reversing. While Iran’s main tanker fleet, NITC (formerly the National Iranian Tanker Company) continues to veil the Iranian identities of its U.S.-blacklisted carriers, IRISL over the past two years or so has reflagged the great majority of its blacklisted vessels back to Iran. Filtering out IRISL vessels which since their U.S. designations appear to have been scrapped, there are currently at least 117 IRISL vessels on the U.S. blacklist. Of these, 112 now show on Lloyd’s database as flagged to Iran.

Among these Iran-flagged IRISL ships is the Azargoun, which with its recent visit to Venezuela has now underscored that for IRISL the Western hemisphere is no longer taboo. According to ship-tracking data on Lloyd’s, the Azargoun set out this January from the Iranian port of Bandar Abbas, arriving in February at Venezuela’s Puerto Cabello. For roughly two months, until late April, the Azargoun lingered in ports along Venezuela — a country with close ties to Iran and the Iran-sponsored terrorist group Hezbollah.

In April, while the Azargoun was visiting Venezuela, I queried Treasury and the State Department about whether this visit might involve any potential violation of U.S. sanctions. Under terms of the Iran nuclear talks, the U.S. government allows temporary easing or waivers of sanctions on some Iranian shipping activity, but the terms are hazy, and the precise beneficiaries and details of their business are confidential. Was the voyage of the Azargoun a case of sanctions-exempt business?

Treasury declined to comment. A State Department spokesperson sent an emailed response: “We are not aware of any sanctions that have been triggered by this specific port call.” Referring to terms of the 2013 Joint Plan of Action that frames the twice-extended Iran nuclear talks, this Treasury reply about the Azargoun’s visit to Venezuela continued: “We examine reports of such activity carefully, and continue to vigorously enforce all relevant sanctions on Iran and Iranian entities that have not been relieved under the Joint Plan of Action, including relevant sanctions on Iran’s shipping sector.”

Should that be reassuring? Here’s some further background on the Azargoun, perhaps also relevant.

Built in 2003, the Azargoun was originally flagged to Iran, owned openly by IRISL and named the Iran Zanjan. Between 2009 and 2013, in an apparent effort to evade the sanctions imposed in 2008, this ship was renamed the Visea, then the Armis; and reflagged from Iran to Barbados to Tanzania, with ownership transferred through a series of front companies in places ranging from the Isle of Man to Panama to the Marshall Islands.

It was in 2011, during the Azargoun’s incarnation as the Armis, flagged to Barbados with a registered owner in Panama, that Treasury put out its press release stating “No Safe Port for IRISL.” This particular ship appears to have been one of Treasury’s immediate targets. The press release accompanied Treasury’s designation of half a dozen Panamanian companies as IRISL fronts, including Mount Everest Maritime, the registered owner at the time of the Azargoun (then the Armis).

In mid-2012, re-accessorized with the Tanzanian flag and under the registered ownership of a new front company, the Azargoun (then the Armis) turned up making port calls at Benghazi, Libya. So did two other blacklisted IRISL container ships, the Parmis and the Tandis, apparently part of a small batch of jointly managed IRISL ships whose previous shell owners in Panama had also been among those targeted by Treasury when it issued its 2011 warning about IRISL being a “dangerous carrier.”

All three of these ships were making repeated runs between Iran and Libya during the months surrounding the terrorist attack that killed U.S. ambassador Christopher Stevens and three other Americans on Sept. 11, 2012 in Benghazi. That is not to suggest that these ships played any part in that attack. No such information has emerged. There remains an intriguing question, however: What cargoes, precisely, were these IRISL ships carrying between Iran and terror-torn Libya?

By 2013, having acquired its current name and been reflagged back to Iran, the Azargoun was one of four blacklisted IRISL vessels which a New York-based watchdog group, United Against Nuclear Iran, alleged had been involved in “illicit ship-to-ship transfers in the Red Sea, potentially transferring weapons, bullion or personnel between vessels.” In comments that June to The New York Times, an official at Iran’s Mission to the United Nations dismissed UANI’s allegations as “counterproductive,” saying that Iran considered UANI’s activities “contrary” to the Obama administration’s policy “which purportedly sought to interact diplomatically with Iran.”

Today, the Azargoun shows on Lloyd’s as owned by an Iranian company that Treasury blacklisted in 2011 as an IRISL front, Rahbaran Omid Darya Ship Management (a Farsi name that translates as “Leaders of the Hope of the Sea”). On another widely used shipping database, Equasis, the Azargoun is listed as owned by an apparently related company, Moskhar Darya Shipping Company (Farsi for “Conqueror of the Sea”), which has an address “care of” the blacklisted Rahbaran Omid Darya.

In its homeward voyage through the Red Sea, bound around Yemen for Iran, the Azargoun has been following another blacklisted IRISL ship, now sailing under the flag of Iran, the Parshad — previously named the Vaafi and then the Chimes, previously flagged to Malta and then Tanzania. Currently, the Parshad shows on Lloyd’s as bound via Mauritius for Iran, returning from a voyage to Bulgaria. It appears that U.S. sanctions — whatever the administration’s promises of enforcement — are evolving in ways less daunting for IRISL not only in Latin America, but in Eastern Europe.

This scene boils down to one more major concession to Iran, as the U.S. pursues the nuclear deal that President Obama now hopes to clinch by the end of June. Iran, the world’s leading state sponsor of terrorism, preacher of “Death to America” and “Death to Israel,” is increasingly reintegrating its main cargo fleet into the world’s shipping traffic. As Obama himself noted in remarks last month about Iran, “we can’t bank on the nature of the regime changing.” The question, as IRISL ships start to fan out again around the globe, increasingly relieved of the costs and constraints of U.S. sanctions, is what might these ships next be carrying?

Claudia Rosett is the Journalist-in-Residence at the Foundation for Defense of Democracies. Follow her on Twitter @CRosett 

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