GOI SAYS NO NEW IRITAL CONTRACTS

C O N F I D E N T I A L ROME 001475 SIPDIS ISN/CPI: CHALMERS E.O. 12958: DECL: 12/03/2018 TAGS: KNNP ECON EFIN ETRD EWWT PARM PREL SUBJECT: GOI SAYS NO NEW IRITAL CONTRACTS REF: A. SECSTATE 104496 ¶B. ROME 1304 ¶C. ROME 1392 Classified By: Deputy Chief of Mission Elizabeth Dibble for reasons 1.4 (b) and (d) ¶1. (C) On 4 December, MFA Deputy Director General for Multilateral Economic and Financial Cooperation Claudio Spinedi informed Econoff that due to GOI "moral suasion," the Italian owners of Irital, a shipping company designated under US sanctions, have agreed not to sign any new shipping contracts with Italian businesses. Spinedi said, however, that existing contracts between Irital and Italian exporters would continue to be honored as the GOI had "no legal basis to rescind these contracts." When asked if expiring contracts would be renewed Spinedi said he did not have all the details of the new Italian policy. Spinedi asked for USG assurances that Italian exporters who were clients of Irital prior to its designation be spared from US sanctions. Spinedi also said that the eventual designation of IRISL is currently being discussed among "like-minded countries," which he defined as the US, Italy, France, Germany and the UK, and also within the EU context. ¶2. (C) Comment: Italy's actions against Irital, an Iranian/Italian joint venture, are encouraging given the GOI's previous objections to US policy (reftels B and C). However, the Italian desire to grandfather existing contracts indicates that the Italians may be trying to strike an ILSA-like deal with the U.S. that will allow business-as-usual to proceed without the threat of US sanctions. Italy may also be trying to come up with a deliverable for the 12 December "National Measures" meeting in Rome of "like-minded" governments. End Comment. SPOGLI