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Individual U.S. Persons Are Generally Authorized to Sell Certain Personal Property in Iran and Transfer Sale Proceeds to the United States, But Due Diligence is Still Required

While U.S. sanctions were substantially ratcheted-up after the United States’ unilateral withdrawal from the Iran Nuclear Deal last year, OFAC took a more practical and permissive approach to U.S. persons needing to transact in certain real and personal property in Iran.

Pursuant to a final rule issued by OFAC on October 30, 2018 and effective as of November 5, 2018, an important Iranian Transactions and Sanctions Regulations (ITSR) provision was expanded to allow U.S. persons—as a practical matter, primarily Iranian-Americans—to sell certain “personal property” in Iran.[1]

Under amended Section 560.543 of the ISTR, individuals who are U.S. citizens and permanent residents[2]  “are authorized to engage in transactions necessary and ordinarily incident to the sale of real and personal property in Iran and to transfer the proceeds to the United States,” but only if the real and personal property was (1) “acquired before the individual became a U.S. person” or (2) was “inherited from persons in Iran.”[3]

Prior to November 5, 2018, § 560.543’s general authorization pertained only to sales and “necessary and ordinarily incident” transactions in real property inherited from persons in Iran or acquired prior to the individual becoming a U.S. person. Because OFAC previously received and approved “specific license applications related to the sale of personal property in Iran,” OFAC amended the general license conferred by § 560.543 to apply also to certain personal property.[4]

Notwithstanding the expansion of the general authorization, U.S. persons seeking to engage in generally authorized sales and related transactions pursuant to § 560.543 must nevertheless understand that while a real or personal property transaction might meet the criteria of the ISTR provision as amended—i.e., the property is “real” or “personal” and was acquired before becoming a U.S. person or was inherited from persons in Iran—the same transactions might nevertheless require one or more specific licenses if they involve, for example, sanctioned parties or other circumstances that would render a generally authorized transaction unlawful if engaged in without specific authorization.

In addition, U.S. persons engaged in generally authorized transactions pursuant to § 560.543 are more likely after November 5, 2018 to encounter practical difficulties transferring the proceeds of authorized real or personal property sales to the United States, as third country banks have pulled out of Iran or are more reluctant to engage in Iran-related transactions, even if generally authorized by the ITSR. To facilitate transfers, parties seeking to conduct transactions should, among other steps, be prepared to clearly explain and provide supporting documentation showing, for example, the nature of the transaction(s) underlying a proposed transfer.

Key Takeaways

For U.S. persons seeking to sell real or personal property in Iran and transfer the proceeds to the United States, the key takeaways are:

  • The November 5, 2018 amendment of ISTR § 560.543 expands the scope of generally authorized sales of property in Iran to include certain personal property, in addition to real property inherited from persons in Iran or acquired before U.S. party became a U.S. person;
  • U.S. persons seeking to transact in real and personal property in Iran pursuant to § 560.543 should ensure that their proposed transactions do not involve sanctioned parties or otherwise run afoul of applicable U.S. sanctions regulations; and,
  • As a practical matter, transfers of funds from Iran to the United States through third country banks has become more difficult after November 5, 2018. U.S. persons seeking to transfer the proceeds of authorized real or personal property sales in Iran should be prepared to demonstrate the nature of transactions underlying transfers, including with supporting documentation, to facilitate transfers out of Iran through third country financial institutions.

For more information about this brief update or MassPoint’s related services, including sanctions counseling and compliance and OFAC license application representation, contact Hdeel Abdelhady at


[1] Office of Foreign Assets Control, Final Rule, Iranian Transactions Sanctions Regulations, 83 F.R. 55269 (Nov. 5, 2018) (“OFAC Final Rule”).

[2] The ISTR also include in the general definition of U.S. person entities organized under U.S. law (including any foreign branches of such entities) or any person in the United States. 31 C.F.R. § 560.314

[3] 31 C.F.R. § 560.543(a).

[4] OFAC Final Rule.

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