Sometime between now and next week, the United States will lift its “secondary nuclear-related economic and financial sanctions” targeting Iran, as outlined in Annex II of the Joint Comprehensive Plan of Action. It will follow in the steps of EU foreign policy chief Federica Mogherini and Iran Foreign Minister Javad Zarif’s issuance of a joint statement announcing that Iran has completed its key nuclear-related steps under the JCPOA and the U.S., Europe, and the United Nations have lifted certain of their sanctions on Iran.

OFAC will likely herald the sanctions-relief with a statement, technical documents related to the lifting of sanctions, certain amendments to the Iranian Transactions and Sanctions Regulations (“ITSR”) and the Iranian Financial Sanctions Regulations (“IFSR”), a notice announcing the rescission of certain Iran-related designations to the SDN List, a series of Frequently Asked Questions (“FAQs”) related to the sanctions relief, and any additional guidance, in order to apprise interested parties of the U.S.’s fulfillment of its JCPOA obligations. Because Iran (and others) will have played a consulting role in determining the kind of sanctions-relief guidance issued by U.S. authorities, we can expect it to be different in kind and in scope than past occasions in which the U.S. has relieved sanctions.

For committed OFAC observers, this will be a true test of OFAC’s ability to administer U.S. sanctions in such a manner as to ensure that U.S. foreign policy objectives are achieved. That will mean putting as much emphasis on areas where the U.S. is relaxing sanctions or creating exceptions to U.S. sanctions prohibitions as to the surviving sanctions prohibitions themselves. In order to keep Iran committed to the nuclear accord, OFAC will need to give confidence to U.S. and foreign parties that they are able to pursue areas of trade with Iran that are no longer sanctioned so that Iran receives an economic benefit to the nuclear bargain it has struck with the United States and other major world powers.

That will prove a major turnabout for OFAC. For the past decade, OFAC has encouraged foreign countries and their companies to refrain from most Iran-related trade dealings – sometimes even including those permissible under U.S. law. The reason is that U.S. authorities sought to impose as much economic pressure on Iran as possible to force Iran into compromise over its nuclear program.

Now, though, OFAC will have to relax its attitude towards Iran and provide clear and consistent guidance to allow U.S. and foreign parties to take advantage of new trade openings. This will involve a shift in U.S. policy towards Iran.  As former OFAC Director and Acting Undersecretary of Terrorism and Financial Intelligence Adam Szubin stated recently, “The United States will not stand in the way of business activities in Iran that are consistent with the JCPOA.”

It will also have to involve a shift in OFAC’s practice.  Part of this will involve an evolving relationship between OFAC and the private sector. As Szubin also said at the same talk, “OFAC will publish clear and detailed guidance to ensure that the business community fully understands the sanctions that are due to be lifted on Implementation Day…If questions remain, people should bring them to OFAC. We are here to help.” Those who have dealt with OFAC on a consistent basis over the past years will be taken by the seeming sea-change in attitude that Implementation Day might herald – instead of relying on ambiguities to ensure U.S. sanctions prohibitions are broadly interpreted, OFAC will now be open to questions to resolve those same ambiguities. For OFAC practitioners, this is indeed change we can believe in.

Nonetheless, there will be a push-and-pull between providing guidance both detailed and clear. Should OFAC go too deep in the details and provide an exhaustive survey of all technical issues relating to sanctions relief, it might prove unworkable for U.S. and foreign companies interested in resuming trade with Iranian parties but overwhelmed by the seeming ins-and-outs of the sanctions relief. Fearful of making one wrong step, these parties will continue to avoid trade with Iran.

However, if OFAC simplifies its guidance to such a degree that it fails to resolve real ambiguities that persist, then it will likewise fall flat as legal advisors will be unable to ascertain with confidence that U.S. and foreign parties can engage in certain trade-related dealings with Iran. There will need to be a happy medium between these two poles.  For all practical purposes, this will be OFAC’s first real attempt to find that medium.

Much is riding on the shoulders of what will be forthcoming in the days ahead. From what I have heard from Europeans and other interested parties, there is reason to be hopeful, though – OFAC has shown a level of engagement on these issues that has been altogether absent in the past. If that is the case, let us hope that attitude persists into the foreseeable future, as a back-and-forth dialogue between OFAC and the private sector is the best means to ensure that U.S. foreign policy objectives are achieved via the use of economic sanctions. The nuclear deal with Iran will be the test case for this development.