Iran undertakes not to let Grace 1 cargo be delivered to EU Sanctioned entity.

Confusion surrounds the last minute US intervention in the Grace 1 case. The matter came back before the Supreme Court today under the Gibraltar sanctions legislation. Th eSupreme Court seems to have suggested that no application was made (or at least maintained) to detain the ship.

The evidence that the cargo on board was bound for Syria and in particular the Baniyas Refinery (which is an EU sanctioned entity) was overwhelming and included the vessel’s passage plan and routine emails between the ship and the operations team. It was more than enough to justify the issuing of a Specified Ship Notice against the Grace 1which led to its detention in early July.

It is now made clear that Iran had proved that it owned the cargo and as such had a right to make an application to the Gibraltar government to have the vessel and cargo released.

Earlier in the dispute the UK government had asked that Iran give some assurance that the cargo would not be sent to an EU Sanctioned entity but Iran had refused to accept such a restraint on their ability to trade. That seemed a likely route to a compromise. However, following meetings between key personnel from Iran who had proved that they were the owners of the cargo, and in a complete volte face, an undertaking has been given by Iran to the effect that the cargo will not be shipped to a sanctioned entity. That undertaking has been accepted in good faith by Gibraltar and accordingly the Specified Ship Notice has been revoked meaning the vessel can leave. Further it was said the it was not in the public interest to forfeit the ship.

No doubt Stena will be looking for a reciprocal gesture from Iran and it seems probable the the Stena Impero will now be released. Face saving all round but no doubt the Grace 1 will be tracked with interest. We will have to see whether the good faith placed in the Iranians was justified.