On 7 August the Commission Delegated Regulation (EU) 2018/1100 entered into force. This Delegated Regulation amended the Annex to Council Regulation (EC) No 2271/96 of 22 November 1996 protecting against the effects of extra-territorial application of legislation adopted by a third country, and actions based thereon or resulting therefrom (‘Blocking Statute’).

The Regulation as amended, applies immediately to economic operators and shall be implemented and applied by national authorities and courts.

The Blocking Statute aims to protect the established legal order, the interests of the Union and the interests of natural and legal persons exercising rights under the Treaty on the Functioning of the European Union against the unlawful effects of extra-territorial application of such legislation.

The aim of this document is to provide guidance on the application of certain provisions of the Blocking Statute. It does not cover all provisions of that legal act in an exhaustive manner, nor does it create any new rules. Only the legal text of the Blocking Statute as published in the Official Journal is binding.

The Commission oversees the application of Union law under the control of the Court of Justice of the European Union. Pursuant to the Treaties, only the Court of Justice of the European Union can provide legally binding interpretations of acts of the institutions of the Union.

The update was triggered by the United States’ unilateral decision on 8 May 2018 to re-impose extra-territorial sanctions against Iran simultaneously with its withdrawal from the Joint Comprehensive Plan of Action (JCPOA), signed in 2015 between Iran, on the one hand, and China, France, Russia, the United Kingdom, Germany, the US and the European Union, on the other. The lifting of certain Iran-related sanctions is an essential component of the agreement. The re-imposition by the US of extra-territorial sanctions could potentially affect EU operators doing legitimate business with Iran. Such legislation will be re-imposed as of 7 August 2018 and 5 November 2018. Since 1996, the Blocking Statute has mainly applied to extra-territorial sanctions of the U.S. related to Cuba. In 1998, the Union and the U.S. signed a Memorandum of Understanding by which the U.S. administration suspended the application of certain provisions of the Cuba extra-territorial sanctions ‘as long as the EU and other allies continue their stepped up efforts to promote democracy in Cuba’.