WASHINGTON, D.C. ( TheStreet) -- Neither Airbus nor Boeing ( BA) can do business with Iran's airlines, with one notable exception: Both are able to provide support on safety of flight matters to the carriers, subject to government approval. Such matters could involve supplying parts considered critical to safe operations, dissemination of information about inspection procedures that relate to a Federal Aviation Administration airworthiness directive, airplane manual updates that are driven by safety concerns or other assistance.
Last week, the U.S. Treasury said Mahan Air Iran's second largest airline,
would be sanctioned because of its relationships with the terrorist group Hezbollah and the Islamic Revolutionary Guard Corps-Quds Force, which allegedly hatched a plot to murder the Saudi Arabian ambassador to the U.S. The designation means U.S. persons cannot do business with Mahan Air, Iran's second largest airline, and the carrier's U.S. assets were frozen. It is intended primarily to restrict Mahan's access to banks, said Michael Zolandz, a partner at law firm SNR Denton in Washington and an expert on sanctions law. Earlier this year, the Treasury imposed similar sanctions on Iran Air, Iran's flag carrier. Both Air and Mahan Air serve cities around the world from Tehran's Iman Khomeni International Airport, and both have Airbus and Boeing aircraft in their fleets, although in recent decades neither manufacturer has sold new aircraft to the carriers. Mahan's destinations include Birmingham, England, and Dusseldorf, Germany, according to its route map. According to Boeing spokesman Tim Neale, "under the U.S. sanctions currently in place against Iran, we cannot have any dealings with Iran's airlines even on safety of flight matters unless the U.S. government gives us permission to do so. " Such instances are rare, Neale said. "The last time the government licensed us to provide a part for an Iranian commercial jet was in 2000, when we were licensed to install an FAA-mandated strut modification kit on an Iranian 747 at a location outside of Iran." As for Airbus, "Europe has imposed strong sanctions vis-a-vis Iran," said spokesman Clay McConnell. "For all transactions valued at more than 10,000 Euros, we need prior authorization from the French government," even for safety of flight transactions.
McConnell said he could not recall any recent safety of flight transactions with the Iranian carriers. He noted that engines and equipment with potential military use cannot be supplied to Iran in any case. Within the airline industry, the strong belief is that airlines are entitled to safety of flight service from aircraft manufacturers. "Air safety should not be held captive to politics," said aviation consultant Scott Hamilton, who follows Airbus and Boeing as managing director of Leeham Co. In the past, Airbus may have been under less severe restrictions than Boeing, Zolandz said. In general, he said, the EU sanctions enable "carve-outs for humanitarian assistance, which could quite possibly encompass safety support. Also, there are European nationals who fly on Mahan Air, so there is an interest in that as well." Zolandz noted that Mahan Air has now been sanctioned under U.S. law, but not under EU and UK law. However, he said, "recently, US and EU sanctions (on Iran) have been converging." -- Written by Ted Reed in Charlotte, N.C. >To contact the writer of this article, click here:
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