US grants second Airbus license to sell planes to Iran

The move in the waning months of Democratic President Barack Obama's administration will further unlock jetliner sales to Iran, Reuters reported.

The US Treasury's Office of Foreign Assets Control issued the license for the sale of 106 planes to Iran Air, a source familiar with the matter said, on condition of anonymity. An Airbus spokesman confirmed that the company had received the OFAC license, but declined to confirm the exact number of planes approved.

Although Airbus is based in France, it must have US approval to sell planes to Iran because at least 10 percent of the aircraft's components are American-made. Tehran provisionally ordered more than 100 jets each from Airbus and Boeing this year.

Before the license was issued, Airbus had US permission for the sale of 17 jets to Iran.

The move prompted complaints from Republicans in Congress. Licenses allowing such sales could be withdrawn by the administration of President-elect Donald Trump. But Trump would likely face opposition from US allies and other world powers who were partners in negotiating the deal to lift some sanctions in exchange for Tehran curbing its nuclear program.

Opponents of the nuclear deal argue that passenger aircraft could be used for military purposes, such as transporting fighters to battle US troops or allies in Syria, something Iranian officials deny.

The US Treasury says that the licenses it issues contain strict conditions to require planes be used solely for commercial passenger use, and not be sold or transferred to a sanctioned person or group.

Last week, the US House of Representatives passed a bill intending to block the sale of commercial aircraft to Iran, which would also affect sales by US firm Boeing (BA.N).

The measure is unlikely to become law during the current Congress, as it would need to pass the Senate, where it would face stiff opposition from Democrats. The White House also said Obama would veto the measure even if it did pass the Senate.

The deals by Airbus and Boeing to sell or lease over 200 jets to Iran Air would help modernize and expand the country's elderly fleet. Iranian officials have voiced growing concerns about what they see as unfair delays in obtaining US licenses, or clarity over banking and financing rules.

Sanctions experts said Treasury licenses allowing such aircraft sales, and easing the way for other commerce with Iran, could be reversed by Trump if he chose to do so.

"The licenses can be withdrawn at any moment...so long as they're not required by legislation, which is a very small number," said David Mortlock, a former White House sanctions official.

The airplane deals still face major obstacles, including reluctance from major European banks to finance deals involving Iran.

The Airbus spokesman said that taken together, the company's two Treasury licenses cover its entire 118-plane deal with Iran, implying that there is some overlap between the two licenses.

Some aircraft have been canceled because of delays in receiving authorizations, and officials say Iran no longer plans to take delivery of A380 superjumbos, so the final tally is likely to be closer to 100 aircraft.

 

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