The Lloyd’s List Podcast: What does the SHIP act mean for shipping?

This episode of the Lloyd’s List podcast was brought to you by Lloyd’s Register — visit www.lr.org/en for more information. THE US refrained from imposing new sanctions on Iran’s shipping sector for most of last year and was said to be lax in its enforcement of existing sanctions as it was eyeing a prisoner exchange deal with Tehran that took place over the summer. That appears to have changed after October 7. Iran’s backing of regional proxies like Hamas, who perpetrated the October 7 massacre, and the Houthis, who have been terrorising the Red Sea, have led the US government and congress to renew their interest in Iran’s oil and shipping sectors. On April 24, US President Joe Biden signed into law a national security spending package that included substantial changes to the administration’s authorities to impose sanctions and to investigate violations. One of the big-ticket items for shipping is the Stop Harbouring Iranian Petroleum Act, AKA the Ship Act, which instructs the president to impose sanctions on foreign ports, refineries, vessels and shipping companies that knowingly process or carry Iranian oil and products, expanding sanctions risk for maritime supply chain actors. The broader legislation also included provision expanding sanctions threat to Chinese financial institutions that process “significant financial transactions” involving Iranian oil or drones, and extended the statute of limitations for sanctions of violations from five to 10 years. However, whether these any measures will have an impact will hinge to a large extent — surprise — on enforcement. In this week’s podcast, our guests Brian Maloney, partner in Seward & Kissel’s litigation and investigation group, and Claire Jungman, chief of staff at advocacy group United Against Nuclear Iran, will walk through the nuances of the new bill, how it fits in with the existing alphabet soup of US sanctions authorities, and how it could impact maritime supply chains, especially in China, to where most of Iran’s oil is exported.