Iran Says US Sanctions Can Hurt American Tech Companies

EghtesadOnline: Citing the new US sanctions against Tehran, workplace chat app Slack banned Iranian users on Wednesday. A deputy director of Iran IT Organization told the Financial Tribune that such unprofessional moves plus the unending hostility will likely compel users across continents to think twice before subscribing to American companies involved in and living off such business.

News ID: ۷۴۶۳۷۰

24 December 2018

Pointing to the mounting pressure from mercurial US President Donald Trump on private companies to end their services to Iran, the Information Technology Organization’s deputy for legal affairs, Mohammad Jafar Nanakar, said, “The legal structure on which these sanctions are premised is thin. As time goes by the international community will concur that these pressures are illegal and discriminatory.”

“US hostility against Iran and other peoples will certainly make people ponder before enlisting services offered by US technology firms,” Nanakar said.

In his opinion, the legal framework in which multinational technology firms operate will certainly evolve in the coming years, according to Financial Tribune.

“So far such companies are bound by national laws. I am certain that in the not too distant future an international legal structure will emerge for regulating activities of these firms and define and safeguard people’s rights.”

Latest Restriction

In a crafty move the messaging company Slack last week deactivated accounts of hundreds of Iranian users around the globe, saying that its decision is in accordance with the anti-Iran policies of the beleaguered Trump administration.

The firm claimed, “In order to comply with export controls and economic sanctions laws and regulations promulgated by the US Department of Commerce and the US Department of Treasury, Slack prohibits unauthorized use of its products in certain sanctioned countries and regions including Cuba, Iran, North Korea, Syria, and the Crimea region of Ukraine.”

On Dec. 21 the firm issued a loose apology on its website (slackhq.com) saying that it had updated its system for applying location information on Dec. 19 to comply with US trade embargoes and economic sanctions regulations.

“Soon after updating, we discovered that we made a series of mistakes and inadvertently deactivated a number of accounts that we shouldn’t have. We recognize the disruption and inconvenience this caused and we sincerely apologize to the people affected by our actions. In fact, we also apologize to the people whose accounts we intended to disable in order to comply with these regulations. We did not handle the communication well... We have restored access to most of the mistakenly blocked accounts, and we are working hard to restore any remaining users whose access was blocked in error.”

However, the firm adds that it will soon begin blocking access to service from IP addresses associated with “an embargoed country.” In other words, users in Iran will be barred from accessing Slack services.

Moderation in Criticism

Following the move, several users on Twitter slammed the Slack decision as “ethnically” motivated and an example of “racism”. Nanakar says that racism is too broad a term to apply to Slack’s decision.

Due to political or legal considerations, “a private company has decided to halt offering services to citizens of Iran and several other countries.”

Implying that there are no rules obliging the company to offer services to residents of the sanctioned countries, Nanakar said, “As such, IT Organization and the ICT Ministry will not take legal action against Slack.”

However, he went on to say that the ministry and the organization in collaboration with the private sector and local guilds will help ensure that Iranian companies and individuals have access to adequate legal counseling in this regard.”

When asked whether the Tehran government is poised to follow up similar cases through legal channels provided by OFAC, Nanakar said the Office of Foreign Assets Control, the US Treasury Department’s financial intelligence department, is part of the American machinations for the imposition of sanctions against Tehran.

“Therefore, pursuing cases through OFAC channels would really be an exercise in futility. Having said that, Iran will explore all legal channels for addressing such issues.”

Domestic Technology

Considering Slack’s move and previous restrictions imposed by US-based companies against Iranians, Nanakar says, “[In future] Iranians’ access to several services offered by US-based companies could be disrupted.”

There are hundreds of similar services offered by non-American companies that Iranians can use. Furthermore, if Iranians are barred from using international services, local technology firms are capable of replacing them, he told the Financial Tribune in an email interview.

While saying that many American firms will probably not ban Iranians, Nanakar said it would be wiser for users to create a backup for their data stored with US service provider(s).

Noting legal complications that can arise from employing services offered by foreign firms, he called on local startups and companies to use services developed by domestic technology firms.

“Let’s ignore the impact of sanctions. Local businesses and users employing services of foreign firms should always consider that foreign firms follow rules of the country where they are based. Many Iranian firms and individuals are not familiar with foreign laws and regulations. This can create complications.”

For instance, he said, if the foreign firm does something that the Iranian user considers infringement, the individual either will have to drop the case or spend huge sums in unfamiliar courts in other countries with unclear outcomes.

Several local startups are offering services that are similar to their foreign peers. “For instance, the local startup Limo offers everything that Slack does.”

In line with their legal responsibilities, the ICT Ministry and IT Organization will provide such local startups with support.