Iran’s Guardian Council (GC) has rejected a bill passed by parliament on combating money laundering as part of the standards set by the international Financial Action Task Force (FATF), GC’s spokesman said on Friday.

In a tweet on Friday night, Abbas Ali Kadkhodaei declared that the Guardian Council has recognized four paragraphs of the bill as inconsistent with the country’s constitution and Shari’a laws, and as such, has returned the bill to the Parliament for making the required changes.

The GC is constitutionally tasked to review legislation passed by parliament and give its seal of approval.

The law approved by parliament is part of four bills, jointly known as Palermo bills in Iran, proposed by the world’s financial watchdog aimed at removing Iran from FATF’s ‘grey list’ and facilitating the country’s economic transactions with the world, state-run news agency.

Only one of the bills aimed at banning terrorism financing has been passed and approved.

Iran has less than two months to adopt the financial reforms proposed by the Financial Action Task Force as part of efforts to improve Iran’s ability to interact with the international banking and trade system.

So far, the country has approved the amendment bill on combatting the financing of terrorism (CFT), while the fate of the three other bills, including the amendment bill on combating money laundering, the United Nations Convention against Transnational Organized Crime (Palermo), and the International Convention for the Suppression of the Financing of Terrorism, is still undecided.

While FATF does not have the authority to impose sanctions, a country blacklisted by the world’s financial watchdog will face severe pressure in its financial dealings with other countries.

Although the bills are not directly connected to Joint Comprehensive Plan of Action (JCPOA) or Tehran nuclear deal with world powers, Iran’s deputy Foreign Minister, Abbas Araqchi believes that rejecting them could have a negative impact on Iran’s negotiations with European countries to keep JCPOA alive after US withdrew from it.

President Hassan Rouhani’s administration proposed four Palermo Bills on November 8, hoping to reduce international pressures on Iran’s deteriorating economy.

Nevertheless, in an orchestrated response, Supreme Leader Ayatollah Ali Khamenei and his close allies in the GC and influential Expediency Discernment Council (EDC) have repeatedly barraged the bills with bitter criticism.

Ten days after parliament initially approved the bill concerning UNTOC, Khamenei personally stepped in on June 20 and called the bill “unacceptable.”

According to Khamenei, UNTOC had been “cooked up” by foreign powers and the parliament should shelve it.

“It is not necessary to join conventions the depths of which we are unaware of,” he said, proposing instead that the parliament create its own laws to combat money laundering and terrorism funding rather than join an international convention.

Furthermore, state-run news agency IRNA cited GC spokesman Abbas Ali Kadkhodaei as saying on July 14, “Iran’s membership in UNTOC is against both the security policies of the country and the resistance economy.”

Conservative allies of Ayatollah Khamenei believe that approval of the Palermo bills might jeopardize the Islamic Republic’s financial assistance to what they describe as the “resistance front”, including Hamas and Lebanese Hezbollah.