The U.S.-Iran Memorandum of Understanding: Prospective Sanctions Relief, Commercial Opportunities, and Legal Risks

Gibson Dunn | June 26, 2026

Summary

Gibson Dunn provides a comprehensive legal analysis of the June 17 MoU, warning that businesses should exercise caution. The MoU is a political framework, not a self-executing legal instrument. Many promises require executive action, congressional review, and regulatory implementation — and cannot be unilaterally unwound by the President.

Sanctions Relief Is Not Automatic

  • The MoU promises to terminate "seemingly all" US sanctions — but this requires substantial executive action, congressional review, and regulatory implementation
  • Statutory sanctions (mandated by Congress) cannot be unilaterally unwound by the President
  • Even the 2015 JCPOA — a comprehensive multilateral agreement — did not give many companies sufficient confidence to commit capital to Iran

Third-Party Obstacles

  • EU, UK, UN Security Council, FATF, and other countries not signatories — their cooperation is necessary for meaningful relief
  • Private insurers and financial sector cooperation also required
  • Consent of other UN Security Council members needed to lift UN sanctions

General License X (OFAC)

  • Treasury issued General License X authorizing Iranian crude production and sales through August 21, 2026
  • US refiners may now import Iranian crude and pay in dollars — a significant departure from 40+ years of sanctions policy
  • ~140M stranded barrels freed; ~$12B in frozen assets released

The $300 Billion Reconstruction Fund

  • MoU proposes a $300 billion reconstruction and development fund for Iran
  • To be financed by "regional partners" and detailed within 60 days
  • This dwarfs anything contemplated in the JCPOA

JCPOA Parallel: A Sobering Guide

  • Even after comprehensive JCPOA relief under Obama, many companies remained reluctant due to compliance concerns, financing constraints, and risk of sanctions returning
  • Those concerns are "likely to be even more pronounced" under current framework

Iran's Economy

  • Highly centralized and prone to corruption — significant business risk
  • Human rights record and support for terrorist proxy groups create additional risk

MoU Structure (14 Points)

  1. Immediate cessation of military operations
  2. Restoration of commercial navigation through Strait of Hormuz
  3. Immediate sanctions relief for Iranian oil exports
  4. Framework for potential termination of all US sanctions
  5. Release of restricted Iranian assets
  6. $300 billion reconstruction fund
  7. 60-day negotiation period for final agreement
  8. IAEA down-blending mechanism for enriched uranium
  9. UN Security Council endorsement required for final deal