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Bill Against Terror-Financing Rejected Again By Conservative Watchdog


Iran parliamentarians hotly debating legislation demanded by international Financial Action Task Force. File photo

Iran's Guardian Council has for the second time rejected a bill against funding terrorism, Fars news agency reported on January 1.

The bill is one of a collection of four pieces of legislation against money laundering and funding terrorism Iran's Parliament (Majles) has approved to meet the requirements of the Financial Action Task Force (FATF), an international body working to ensure countries and financial institutions have the right mechanisms to prevent corrupt dealings.

Majles ratifications need to be approved by the Guardian Council, a watchdog that makes sure laws are consistent with Iran's constitution and Shiite religious rules.

It is not clear what exactly is Ayatollah Ali Khamenei's position on the final adoption of these laws. He clearly controls the Guardian Council, but is it his wish to reject the bills, or he does not want to make any decision and the Council members also do not want to be responsible in the matter.

The Guardian Council has said that the Majles has resolved only two of the 22 problems concerning the anti-terror-financing bill, which is said to be the most important one of the four FATF requirements.

The Council has so far approved only one of the other bills and rejected the other three. Now the Expediency Council, as the final arbiter between the Majles and Guardian Council has to pass a verdict on the three remaining bills.

A quick decision by the Expediency Council is essential for Iran as FATF's deadline ends in less than two months. The Council's new chief, Sadeq Amoli Larijani, was appointed on December 30, after a one year state of lull while its former chairman was in his death bed.

An influential Expediency Council member, Mohammad Reza Bahonar, has said in an interview with the administration-owned Iran newspaper that the Expediency Council might complete its review of the legislation next week. Bahonr added that in his opinion the Expediency Council will approve the remaining FATF bills.

At least two other Expediency Council members, conservative Ahmad Tavakoli, and reformist Majid Ansari have also opined that the council will approve the bills.

The three members expressed optimism about the approval of the bills while previously a committee at the council had said there were "flaws" in the bills.

The speaker of Iran's parliament, Ali Larijani, has said that European banks, as well as some banks in "friendly countries," possibly meaning Russia and China, have withheld their cooperation with Iran waiting to see if Tehran will meet the FATF requirements.

President Hassan Rouhani has also said that Iran's banking transactions will cost 20% more if the FATF bills are not ratified in time.

Hardliners who oppose Iran joining the FATF have said that they fear approving the bills against money laundering and funding terrorism will prevent Iran from extending financial assistance to groups such as HAMAS and the Lebanese Hezbollah.

The bills' supporters say its opponents in fact fear transparency and anti-corruption campaigns.

The ratification by the Majles includes a clause that says the Islamic Republic does not recognize groups committed to "legitimate defense" as terrorists.

In October 2018, the FATF temporarily suspended counter-measures against Iran and has taken it out of its blacklist until February and the International Monetary Fund (IMF) has advised Tehran to ratify the anti-corruption bills before the February 2019 deadline.

For Iran, access to finance has become particularly pressing since the United States walked out of a 2015 nuclear deal in May 2018 and began reimposing sanctions. The other parties to the deal -- Britain, France, Germany, China and Russia -- have sought to salvage the agreement and maintain trade with Iran, but have demanded that it accedes to the FATF.

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