The Instrument in Support of Trade Exchanges (INSTEX) was a European

special-purpose vehicle A special-purpose entity (SPE), also called a special-purpose vehicle (SPV) or a financial vehicle corporation (FVC), is a legal entity (usually a limited company of some type or, sometimes, a limited partnership) created to fulfill narrow, speci ...

(SPV) established on 31 January 2019 and liquidated in March 2023. Its stated mission was to facilitate non-

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and non-

SWIFT Swift or SWIFT most commonly refers to: * SWIFT, an international organization facilitating transactions between banks ** SWIFT code * Swift (programming language) * Swift (bird), a family of birds It may also refer to: Organizations * SWIF ...

transactions with Iran to avoid breaking U.S. sanctions.

History

on , the initial announcement of INSTEX by France, Germany and the UK specified that the SPV would be headquartered in

Paris Paris () is the Capital city, capital and List of communes in France with over 20,000 inhabitants, largest city of France. With an estimated population of 2,048,472 residents in January 2025 in an area of more than , Paris is the List of ci ...

and headed by Per Fischer, who formerly had served as Head of Financial Institutions at

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between 2003 and 2014. In Iran, INSTEX was mirrored by the STFI (Special Trade and Finance Instrument), a similar SPV. STFI matches incoming and outgoing transactions in the same way. In effect, two Iranian entities pay each other, thus, no money crosses the Iranian border.

Ali Khamenei Ali Hosseini Khamenei (; born 19 April 1939) is an Iranian cleric and politician who has served as the second supreme leader of Iran since 1989. He previously served as the third President of Iran, president from 1981 to 1989. Khamenei's tenure ...

, Leader of the Islamic Revolution, commented by likening the European financial mechanism for trade with Iran to a "bitter joke". As of May 2019, the use of the SPV was limited to humanitarian purposes; such as the purchase of foods or medicines. INSTEX had been made available to all

EU member states The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated population of over 449million as of 2024. The EU is often de ...

. On 11 February 2019, Russian deputy foreign minister

Sergei Ryabkov Sergei Alexeyevich Ryabkov (; born 8 July 1960) is a Russian diplomat, currently serving as the Deputy Foreign Minister of the Russian Federation since 2008. Early life and education Ryabkov was born in Leningrad in 1960. At age 22, in 1982, he ...

stated that Russia would be interested in participating in INSTEX. On 28 June 2019, France, Germany and the United Kingdom told a meeting of the

JCPOA The Joint Comprehensive Plan of Action (JCPOA; (, BARJAM)), also known as the Iran nuclear deal or Iran deal, is an agreement to limit the Iranian nuclear program in return for sanctions relief and other provisions. The agreement was finalize ...

Joint Commission that INSTEX had been made operational and available to all EU member states.

Federica Mogherini Federica Mogherini (; born 16 June 1973) is an Italian politician who served as High Representative of the Union for Foreign Affairs and Security Policy and Vice-President of the European Commission from 2014 to 2019. A member of the Democratic ...

High Representative of the European Union for Foreign Affairs and Security Policy The High Representative of the Union for Foreign Affairs and Security Policy/Vice-President of the European Commission (HR/VP) is the chief co-ordinator and representative of the Common Foreign and Security Policy (CFSP) within the European U ...

stated that the purpose of INSTEX is to facilitate "legitimate trade" with Iran for any EU member and has been conceived to be open to non-EU countries. In addition to the three founders, five other EU nations declared in a joint statement on 29 November 2019 that they will join the INSTEX mechanism for trade with Iran: Belgium, Denmark, Netherlands, Finland, and Sweden. On 31 March 2020, over one year after the introduction of the platform, the first INSTEX transaction was concluded. It covered an import of medical equipment to combat the

COVID-19 Coronavirus disease 2019 (COVID-19) is a contagious disease caused by the coronavirus SARS-CoV-2. In January 2020, the disease spread worldwide, resulting in the COVID-19 pandemic. The symptoms of COVID‑19 can vary but often include fever ...

outbreak in Iran. European countries stated in March 2023 they had decided to end INSTEX, through which only a single transaction had traded. Academic Tim Beal described INSTEX as one among the responses to

United States sanctions United States government sanctions are financial and trade restrictions imposed against individuals, entities, and jurisdictions whose actions contradict U.S. foreign policy or national security goals. Financial sanctions are primarily administ ...

viewed by commentators as contributing to

dedollarisation Dedollarisation refers to countries reducing reliance on the U.S. dollar as a reserve currency, medium of exchange or as a unit of account. It also entails the creation of an alternative global financial and technological system in order to gain ...

References

{{Authority control Companies based in Paris Financial services companies established in 2019 International organizations based in France Presidency of Hassan Rouhani Financial services companies disestablished in 2023 2023 disestablishments in France French companies established in 2019 Sanctions against Iran

History

See also

References