It went little reported, but the E3+1 (France, Germany, the United Kingdom, and the United States) late last week issued an important public statement regarding JCPOA implementation.

The impetus behind the statement was evident: Iran has yet to receive much practical value from the lifting of U.S. nuclear-related sanctions; and, as a result, there are persistent concerns as to whether the United States is living up to its sanctions-lifting commitments under the nuclear accord. Because Europe is interested in establishing broader trade ties with Iran, they too are frustrated at the manner in which surviving U.S. sanctions are inhibiting the re-establishment of trade relations. That has led to significant pressure on the United States to which the Obama administration has not hesitated to respond, as is clear by Secretary Kerry’s recent meeting with the British Bankers Association and the successive tours of administration officials overseas to explain the sanctions-lifting under the JCPOA and the scope of surviving U.S. sanctions.

Now comes this joint public statement – titled “Statement by France, Germany, United Kingdom, United States and the High Representative of the European Union for Foreign Affairs and Security Policy on Post-JCPOA Business with Iran.” (Obviously, the title gives away its purpose pretty clearly.)

In the joint statement, the E3+1 assert that:

[I]t is in our interest and the interest of the international community to ensure that the JCPOA works for all participants, including by delivering benefit to the Iranian people. This includes the reengagement of European banks and businesses with Iran…

In the JCPOA, all parties pledged to take steps to ensure Iran’s access in areas of trade, technology, finance and energy. In this context, the EU and its Member States are exploring possible areas of cooperation with Iran, including the use of export credits to facilitate trade, project financing, and investment in Iran…

The statement continued:

Our governments have provided extensive guidance on the scope of sanctions lifted and those that remain in place and will continue to do so including through additional guidance. We understand that firms may continue to have specific sanctions-related questions or concerns about doing business in Iran, and we stand ready to provide expeditious clarifications. We encourage firms to approach our governments to address remaining concerns, rather than forgo opportunities due to misperceptions or lack of information.

So far as it implicitly acknowledged the manner in which remaining U.S. sanctions are inhibiting the re-engagement of major European financial institutions with their Iranian counterparts, the joint public statement did not let Iran off the hook, either:

While we are committed to providing clarity on sanctions-related issues, businesses will make their own decisions about commercial activity with Iran. There are factors within Iran’s control that have influenced companies’ decision-making and hindered Iran’s economic progress. For Iran to realize the economic improvement it desires, it will also have to take steps to create an environment conducive to international investment particularly regarding the compliance with FATF recommendations. We are ready to fully support Iran’s efforts in this process.

Couple of points: First, while the joint statement is a welcome indication of the seriousness with which the E3+1 is taking the issue of JCPOA implementation, it skirts the main issue. As I have long written now, the provision of guidance on the scope of remaining U.S. sanctions will only take certain non-U.S. banks and large enterprises interested in engaging Iran so far. Instead, there needs to be some fundamental changes to the U.S. primary sanctions regime. While such changes might be far beyond the scope of the nuclear accord (the point is an arguable one), I am skeptical that we will see large-scale trade with and investment in Iran until the U.S. undoes certain parts of its remaining sanctions.

Second, it is an excellent sign that the E3+1 are now on record “fully support[ing] Iran’s efforts” to come into full compliance with FATF recommendations regarding their AML/CFT regime. As I have noted, Iran is currently taking substantial steps – including passage of a CFT law and amendments to their AML regime, inclusion in the Eurasian Group as an observer state, and negotiation of an Action Plan with the FATF on steps forward. Next month, the FATF will issue an updated public statement that may take into account certain of these steps and revise the section on Iran accordingly. The fact that the U.S. and major European states support this process is an encouraging sign that we may soon see fundamental progress on the issue of Iran’s AML/CFT regime.