Over the last several months there has been a lot of buzz around Iran’s technology start-up community and their potential for growth and innovation. This has prompted many folks in the U.S. to develop a strong and growing interest on how they can get involved with Iran’s tech start up community. This interest has manifested itself into a variety of questions, but the two most common questions I get in relation to this interest are the following: 1) Can a U.S. person speak on tech related subjects at a conference, for example TEDtalkx, in Iran?; and 2) Can a U.S. person serve as a mentor to tech entrepreneurs in Iran. My response to both questions is probably not without a license from the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”).

Both speaking at a conference in Iran and mentoring a person in Iran constitute the provision of services. The export of services by U.S. persons to Iran is prohibited by the Iranian Transactions and Sanctions Regulations (“ITSR”). Further, 31 C.F.R. 560.314 defines U.S. persons, in part, as U.S. citizens or permanent legal residents located anywhere in the world. That means, for example, that a U.S. green card holder living in Dubai cannot provide services to Iran or to parties ordinarily resident in Iran.

Some people reading this post may be saying, hey isn’t there a general authorization at 31 C.F.R. 560.554 for participation in public conferences? To that I would say, yes, you are correct, there is. However, 560.554 has some very particular language. In relevant part, 560.554 states that, “the exportation and reexportation, sale, or supply of services from the United States or by a U.S. person are authorized where such services are performed in the United States by or for a person who is ordinarily resident in Iran…..for the purpose of, or which directly relate to participating in a public conference, performance, exhibition, or similar event….” In other words, a U.S. person can speak at a conference for the benefit, or at the behest, of an Iranian, however, such speaking engagement would have to occur within the United States.

As for mentoring, a lot of people have made the argument to me that it’s not formal, and it’s just as if would be providing friendly advice for no compensation to entrepreneurs in Iran. First, it’s my belief that giving someone advice, as least as it relates to business, certainly seems to be a service, as the person providing the advice or mentorship is undertaking an act for the benefit of another person. Second, compensation is not an issue. As the Second Circuit observed in U.S. v. Banki, and in line with OFAC’s thinking on the issue, the presence of fees in exchange for the service is not a requirement for a prohibited export of service under the ITSR to occur. Finally, I informally ran the idea of whether mentorship by U.S. persons for Iranian technology entrepreneurs was prohibited by the ITSR by someone involved in the OFAC licensing process. Their off the record response? “Sounds like business consulting services to me.”

I should note that General License D-1 has afforded U.S. persons some great opportunities for exporting goods, services, and technology to Iran which are incidental to personal communication transactions. However, as with everything OFAC related, every transaction is fact specific. As such, it’s my belief that the transactions described above would need licensing from OFAC before being engaged in even if the speech, or the mentoring, would seem to be in the spirit of General License D-1. In sum, to all those considering such activities, it would be wise to apply for an OFAC license before assuming that the transactions are either too innocuous to be prohibited, or otherwise covered by an OFAC general authorization.