3M Company (“3M”), a global manufacturing company based in St. Paul, Minnesota, has agreed to pay $9,618,477 to settle its potential civil liability for 54 apparent violations of OFAC sanctions on Iran. This conduct occurred between 2016 and 2018 when a 3M subsidiary based in Switzerland, 3M (East) AG (“3M East”), knowingly sold reflective license plate sheeting via a German reseller to Bonyad Taavon Naja, an entity controlled by Iran’s Law Enforcement Forces. Additionally, one U.S. person employed by a 3M foreign subsidiary was closely involved in the sales. The settlement amount reflects OFAC’s determination that 3M’s apparent violations were egregious and voluntarily self-disclosed.
Description of the Apparent Violations
In November 2015, in anticipation of the implementation of the Joint Comprehensive Plan of Action (JCPOA), employees at 3M’s subsidiary 3M Gulf Limited (“3M Gulf”) in Dubai, United Arab Emirates, began working on a proposal to sell reflective license plate sheeting (“RLPS”) to a German company. 3M initially believed the German company would use the RLPS to manufacture blank license plates for export to Iran. In January 2016, the JCPOA went into effect and OFAC published General License H (“GL H”), which authorized foreign subsidiaries of U.S. companies to engage in certain transactions with Iran. OFAC explicitly excluded transactions with Iranian military, paramilitary, intelligence, or law enforcement agencies, or any entities affiliated with those groups, from the scope of the GL H authorization. Similarly, GL H did not authorize U.S.-person involvement with Iran-related transactions undertaken by the foreign subsidiaries of U.S. companies.