Due to the United States’ unilateral sanctions against Tehran, it is estimated that about $150 billion of Iranian assets are being frozen in other countries. By blocking about $7 billion of Iranian oil assets, South Korea is one of the major countries that refuses to release them. It is followed by Iraq and Japan.

Although the exact amount of Iran's blocked assets is not known, some reports say Europe alone owes Iran $100 billion. It seems that a large portion of these assets was for the sale of oil to these countries.

Britain

 In the 1970s, Iran paid for Chieftain tanks from the United Kingdom. Under the agreement, 1,500 battle tanks and armored vehicles were to be delivered to Iran. 

Experts believe that the conclusion of such an agreement breathed new life into Britain's economy, which was in recession at that time. After the Islamic Revolution in Iran in 1979, many military and trade agreements with Western countries were canceled, but in the case of the deal with Britain, Iran had paid all the money in advance. The purchased battle tanks must have been delivered to Iran.

However, London exploited the opportunity to renege on all promises and obligations. It not only refused to deliver the tanks, it did not even return the money.

Over the past 48 years, the blocked money has made a significant profit in Britain’s banks. However, Iran has not received the money and its interest rate.

Iran has repeatedly protested Britain over the issue and even sued the London government. Finally, following a Br?t?sh court verdict, London agreed to pay the debt. Now Britain owes Iran around 400 million pounds.

Japan

Japan was also a buyer of Iranian oil but refused to pay the money even before the nuclear deal when Iran was under UN sanctions. After the signing of the JCPOA and the relative easing of sanctions, Iran hoped to recover some of its frozen funds. The process to unfreeze $4.2 billion of oil revenues in Japan started, and part of the money was paid within six months in eight installments.

The course of events changed after the withdrawal of the United States from the JCPOA. Again, Japan refused to pay the oil money. Nevertheless, Japan still wanted to maintain its long-standing ties with Iran. After 41 years, when in June 2019 the Japanese Prime Minister Shinzo Abe visited Tehran, promises were revived to repay Japan's $ 1.5 billion oil money to Iran.

In contact with the Japanese embassy, the Tehran Times, to elaborate Tokio's debt to Tehran, the newspaper was told that due to the absence of the Japanese ambassador to Tehran, the relevant authorities would contact the newspaper in the coming days.

 U.S.

The United States was one of Iran's most influential trading partners before the Islamic Revolution, but after the downfall of the Shah regime, it turned to one of the countries that owed tens of billions of dollars to Iran.

Due to its hostile policies against the Islamic Republic, the U.S. tried to avoid the repayment of Iranian money and threatened to impose sanctions on other countries if they repay their debts to Iran. Iran's assets blocked in international accounts are estimated at between $100-150 billion, and a large part of this huge money is frozen in the United States.

This is not the only money blocked in foreign banks. Rather, Iran has blocked property, including real estates, abroad.

The estimated value of Iranian real estate in the United States and their accumulated rent is about $50 million. So far, the United States has tried to prevent the release of Iranian property and assets under false pretenses, to the point that the American government has confiscated an Iranian-owned skyscraper in Manhattan that worth more than $1 billion. Not only have these assets been blocked, many Iranian individuals and entities have also been placed on the sanctions list.

Luxembourg

It was in March 2020 that Abdolnaser Hemmati, the governor of the Central Bank of Iran (CBI), announced a legal success in releasing $1.6 billion of Iran's blocked assets abroad.

And at the time, he stressed that Iran will continue efforts to get loans from the International Monetary Fund (IMF).

It was on March 27 that Hemmati announced: "The central bank, in continuation of its active approach and efforts, with the support of the foreign minister, devoted all its efforts to provide the foreign exchange resources needed by our country, …. to buy medicine, medical equipment, and humanitarian aid. Efforts to gain quick access to IMF funding, as Iran's legal and definitive right, and to pursue the release of the Central Bank of Iran's foreign reserves, which have been unjustly blocked under the U.S. government pressure, are all in this regard."

Now, with legal action by the government, a court in Luxembourg has lifted the ban on the seizure of $1.6 billion of Iranian financial resources. And at the same time, another court has temporarily prevented the transfer of these resources to the United States.

Canada

In September 2019, in an unusual move, Canada sold part of Iran's properties. It confiscated the properties to pay the proceeds to individuals it called "victims of terrorism."

The Ottawa government reportedly has done so under the pretext of paying compensation to the so-called "victims of terrorism."

According to a document from the Ontario Supreme Court, individuals have received part of the proceeds from the sale of Iranian-owned buildings in Ottawa and Toronto under the pretext of being "victims of terrorism".

Also, the amount of property sold by the Iranian government in Canada is estimated at more than $28 million. Among the Iranian-owned property sold under false pretenses by the Canadian government was the Iranian Cultural Center near the University of Ottawa, which values $26.5 million. It was purchased by a construction company in Montreal.

The Iran Studies Center building in Toronto was also sold for $1.85 million, and $6.2 million was withdrawn from Iranian bank accounts in Canada.

UAE 

Relations between Iran and the UAE have gone through many ups and downs since the victory of the Islamic Revolution's victory, especially in recent years. Due to the destabilizing role of the UAE in the region, relations have become cold. 

Following the strained relationship, the UAE government froze the assets of nine Iranian individuals and entities in June 2018.  The UAE central bank had announced a year before, seven exchange offices, most of whose activities were related to Iran, would be limited in compliance with anti-money laundering laws. 

However, in recent months, the UAE announced the release of $700 million of Iranian money. A member of the Iranian parliament revealed this news, saying that the Iranian exchange offices would be reopened in Dubai after a long closure.

In contact with the UAE Embassy in Tehran, the Tehran Times was told that the embassy would respond to its demand to interview relevant officials in the coming days.

Iraq

Currently, relations between Iran and Iraq are strategic and the volume of trade relations between the two countries is high. Iraq owes money to Iran as it imports gas and electricity from Iran. During the new Iranian calendar year (March 2020-March 2021), Iranian officials traveled to Baghdad to follow up on Iraq's debts to Tehran.

The Iraqi side has announced its readiness to pay the money; however, American sanctions are hampering Iran's access to its assets in Iraq, creating obstacles to Tehran-Baghdad's relations.

Another point is Iraq's fragile economy, which has made it rather impossible for Baghdad to pay its debts to Iran in dollars and euros. Baghdad has announced it is ready to pay its dues in Iraqi dinars, but the dinar's official value differs from that in the open market. Of course, accepting the offer could harm Iranian companies.

During a visit by Iranian Energy Minister Reza Ardakanian to Baghdad on June 5, Iraq paid half of its debt for electricity, which amounted to about $400 million. The two countries even signed an agreement to extend Iran's two-year electricity sales to Iraq.

Also, during the Iranian central banker's visit to Iraq, it was agreed that the Iraqi government provide part of the basic goods, including medicine, for Iran from the Islamic Republic’s assets held in Iraq.

South Korea

Prior to the U.S. sanctions, South Korea was a regular customer of Iranian oil. Even after the U.S. imposed unilateral sanctions on Iranian oil exports, Seoul, along with seven other capitals, enjoyed a 180-day exemption.

During this time, South Korea bought 350,000 barrels of oil and gas condensate per day from Iran, but at the same time, it was negotiating with new sellers to replace them with Iran's oil and gas. After the U.S. sanctions against Iran's banking system and oil exports in October 2018, the Koreans also invented excuses and refused to pay for the oil money.

Iran's banking officials have estimated the amount of South Korea's debt to Iran at about $ 7billion. After the Koreans' procrastination, Iranian officials strongly protested and demanded the release of the assets.

 But according to a source in the Iranian Foreign Ministry, during two years of negotiations with the Koreans, they preferred to just give reports to the United States and waiting for a response instead of paying the funds.

South Korea seems to prefer to follow illegal and unilateral U.S. sanctions and even preventing Iran from using the money to buy food and medicine that are not subject to sanctions.

In May 2020, South Korea sent a humanitarian aid shipment to Iran. It contained medicinal items that are said to be used therapeutically for incurable diseases and valued at half a million dollars.

Immediately after sending it, Seoul announced that it would send another $2 million aid shipment to Iran next month, including medicine, medical equipment, and agricultural goods and equipment. The value of these items is miles away from the Iranian funds blocked in South Korea.  There seems to be no will on the part of Seoul to pay the assets even in the form of humanitarian aid.

Although South Korea is a close ally of the United States, it has also been a major trading partner of Iran in recent decades. Seoul is practically struggling to create a balance between maintaining a relationship with the United States and keeping trade with Iran. Nevertheless, the country's banks and financial institutions prefer not to choose the risky path of transactions subject to secondary sanctions.

In contact with the South Korean embassy, to collaborate the South Korea's debt to Iran, the Tehran Times told an appropriate response would be given by the ambassador or the other diplomatic officials in the next few days.

53 years of business dealings
Economic ties between South Korea and Iran began with the reopening of the Iranian embassy in Seoul in 1967.

 However, before the Iranian embassy's official reopening, Tokyo was responsible for coordination between the two countries.

 Iran’s great business transactions with Korea, which was relatively stable compared to other East Asian countries, led to the opening of a new chapter in economic relations between the two countries.

After the 1973 oil crisis and the rise in oil prices from $3 to $12 a barrel, the two countries signed agreements to increase trade.

Under the agreement, trade was set to reach $2 billion over a five-year period by 1980. 

Economic relations continued in the wake of South Korea's need for cheap, high-quality Iranian oil until a $10 billion deal was signed in 2008 despite sanctions against Iran over its nuclear program.

Despite extensive UN sanctions against Tehran before the conclusion of the 2015 nuclear deal, Iran made efforts to maintain prosperous trade and economic relations with South Korea, especially in the last decade. However, now Trump's hostile policies have cast a shadow on the ties.

The escalation of sanctions under false pretenses and U.S. officials' remarks to "bring Iran back to the negotiating table" added another layer of skepticism to Tehran-Seoul relations. It is estimated that South Korea's imports of Iranian oil have dropped to zero over the last two years.

South Korea: From a major buyer of Iranian oil to a big debtor

Prior to the escalation of sanctions against Tehran, South Korea was one of the top five buyers of Iranian petroleum products and the second-largest importer of oil in 2017 after China.

According to official reports, in 2017, after the signing of the JCPOA, South Korea imported an average of 368,000 barrels of oil per day from Iran. This amount was reduced to about 211,000 bpd in 218.
Following the announcement of the return of sanctions and giving Iranian oil buyers six months to find new oil sellers, South Korea reduced its oil orders from Iran, and in May 2019, shortly after the cancellation of all oil exemptions, its oil imports from Iran were reduced to zero.

Although the sanctions targeted Iran's oil industry, two months after the United States "called for tougher sanctions" and ended exemptions, South Korea reduced gas condensate purchases from Iran between 32 to 62 percent, looking for other sellers.

According to South Korean customs reports, in the first two months of 2019, an average of 176,000 barrels of gas condensate was purchased from Iran per day. The purchase of South Korean gas condensate from Iran in the same period of 2018 was reported between 250,000 to 450,000 barrels per day. 

However, due to the Iranian Ministry of Oil's policy after the imposition of a new round of oil sanctions, new statistics on oil exports and its products have not been published in the media for several years.
Although some reports suggest that South Korea has kept Iran's oil imports at zero amid fears of future U.S. sanctions it has kept gas condensate imports between 15,000 and 60,000 barrels. Buying condensate is preferable for Koreans because of its low price.

In November 2018, after the Korean officials' meeting with Iranian oil managers, it was decided to pay Iranian oil revenues in form of purchasing goods from South Korea. Under this mechanism, money from the sale of Iranian oil remains in the Korean banks, and Iran can use it to buy goods and medicine. 

However, from the last two years until this month, only $500,000 of oil revenues have entered Iran in the form of medicine.

Korean procrastination has endangered the health of Iranian citizens

Less than a month after the Foreign Ministry announced that it was importing $500,000 worth of pharmaceutical products from Korea after two years of negotiations, the Iranian central bank governor announced that in the current situation that the Coronavirus outbreak is threatening the lives of Iranian citizens, it would increase pressure on Seoul to free up billions of dollars.

"We reserve our rights to take legal actions under international laws," Hemmati told Bloomberg. "The actions of banks in South Korea were preventing Iran from using the money to buy foods and medicines, trade that's exempt from U.S. sanctions."  

 "It is appalling to see that Korean banks have conveniently neglected their obligations, common international financial agreements, and decided to play politics and follow illegal and unilateral U.S.

sanctions," according to Hemmati.

According to informed sources at Foreign Ministry, although negotiations with South Korea for Iran's access to its blocked money are still ongoing and meetings are to be held virtually there is still no clear prospect.

Despite Seoul’s commitment to release about $100 million for medicine for special diseases in Iran, no practical action has been taken. This is while Iran is facing a severe health crisis and is in urgent need of the necessary resources to deal with the rapidly increasing the deadly Coronavirus. The Koreans have not provided the necessary resources to buy vaccines, nor have they sent drugs for special diseases to Iran.

In this regard, Michael Page, the deputy Middle East and North Africa director at the Human Rights Watch, tells the Tehran Times that "despite existing humanitarian exemptions, broad U.S. sanctions on Iran have created massive obstacles, especially in terms of banking access, for the Iranian government to fulfill its responsibility to protect residents' right to health.

 "With Covid-19 cases in Iran rising dramatically again during this pandemic, the Trump administration's decision to expand sanctions that threaten Iranians' right to health further is a particularly cruel one," he notes.

Seoul a big loser of Iranian market 

Iran has been a big market for South Korean goods over the last two decades, including home appliances and cellphones; however, South Korea’s refusal to release the Iranian assets may ruin Seoul-Tehran ties forever.

Seoul’s persist to follow illegal and unilateral U.S. sanctions against Iran would lead to loss of the Iranian market, as Tehran may not welcome Korean brands again.

Without a doubt, South Korea’s move to block the Iranian funds will certainly have a negative effect on bilateral ties.