On November 19, 2015, the United States Department of the Treasury’s Office of Foreign Affairs Control (“OFAC”) announced the de-listing of Dettin SpA from OFAC’s Specially Designated Nationals and Blocked Persons List (“SDN List”). Dettin SpA, an Italian industrial firm, was designated for sanctions in August 2014 for violations relating to the Iran Sanctions Act (“ISA”).

Some have expressed surprise at the de-listing, considering that the de-listing of Dettin SpA was scheduled to take place upon Implementation Day of the Joint Comprehensive Plan of Action (“JCPOA”) – the nuclear agreement agreed to between the United States, other major world powers, and Iran. Dettin SpA was included in the list of individuals and entities outlined in the Attachments to the JCPOA. Some critics have thus claimed that the de-listing of Dettin SpA provides Iran an unwarranted benefit before it completes the key nuclear-related steps outlined in the JCPOA.

Such analysis is wrong, however. While Dettin SpA would have been de-listed upon the verification by the IAEA that Iran had completed its key nuclear-related steps outlined in the JCPOA, its sanctions designation remained contingent on Dettin SpA meeting the designation criteria of the Iran Sanctions Act. In Dettin SpA’s case, it was designated for sanctions relating to the knowing provision to Iran’s petrochemical industry of goods and support whose value exceeded $250,000. Provided, then, that Dettin SpA had ceased its support of Iran’s petrochemical industry and had taken remedial steps to either negate the benefit to Iran of its previous activities or ensure that such activities do not recur in the future, it would have been able to petition the State Department to rescind its ISA-based sanctions designation. According to reports, that is exactly what happened, as Dettin SpA’s legal counsel had “extensive and ongoing consultations” with U.S. sanctions authorities in the weeks leading up to its de-listing.

Moreover, its de-listing would not have provided Iran an unwarranted benefit. The value of U.S. sanctions is not determined by the number of individuals and entities designated for sanctions, but rather by the ability of those sanctions to inhibit those activities that the U.S. is targeting for sanctions. In other words, while the U.S. sanctioned Dettin SpA for providing goods and other support to Iran’s petrochemical industry, the presumptive goal of that sanctions designation was to inspire Dettin SpA to cease its activities and to warn other foreign companies from engaging in similar behavior.

Rather than seeing the de-listing of Dettin SpA as an unwarranted benefit to Iran, then, the de-listing should be evidence that U.S. sanctions achieved their ultimate goal. Dettin SpA has presumably ceased to provide support to Iran’s petrochemical industry, at least for so long as doing so remains impermissible as a matter of U.S. law.