The Risks of Doing Business with Iran: A Renewed Warning to the International Business Community

Eighteen Years of Corporate Engagement and Why UANI's Warning on Iran Remains Unchanged

Since its founding in 2008, United Against Nuclear Iran (UANI) has engaged publicly and privately with thousands of businesses—from the world's largest multinational corporations to small and medium-sized enterprises—warning them of the significant legal, financial, operational, and reputational risks associated with conducting business in or with the Islamic Republic of Iran. Through sustained corporate engagement, shareholder advocacy, research, and public campaigns, UANI has successfully persuaded major companies across virtually every sector of the global economy—including energy, banking, insurance, shipping, aviation, automotive, mining, manufacturing, engineering, telecommunications, and professional services—to either withdraw from the Iranian market or refrain from entering it altogether. Over the past twelve months, those risks have only deepened as regional instability has intensified, sanctions and export-control regimes have become increasingly complex, and Iran's support for terrorist organizations, military proxies, and illicit procurement networks has continued unabated.

On June 17, 2026, the U.S. and Iran signed a Memorandum of Understanding (MOU), which included a commitment (Point 7) from the U.S. to “to terminate all types of sanctions against the Islamic Republic of Iran, including the United Nations Security Council resolutions, i.e. International Atomic Energy Agency (IAEA) Board of Governors resolutions and all unilateral U.S. sanctions, primary and secondary, in an agreed upon schedule.”

This pledge has generated renewed interest in certain commercial circles regarding the possibility of future business opportunities should additional sanctions relief eventually materialize. International law firms have reportedly begun advising clients on the potential implications of the MOU and monitoring possible changes to U.S. and international sanctions regimes. Likewise, sanctions advisory firms, trade consultants, financial institutions, insurers, and export-compliance specialists have reported increased inquiries from companies seeking to understand whether Iran may once again become commercially accessible. Early interest appears concentrated in sectors that historically viewed Iran as an attractive market, including energy and petrochemicals, civil aviation, automotive manufacturing, industrial equipment, engineering and construction, shipping and logistics, consumer goods, pharmaceuticals and medical devices, agriculture, mining, telecommunications, and financial services. While much of this activity remains exploratory, the MOU has undeniably prompted some companies and their advisers to reassess Iran's commercial prospects.

UANI takes this opportunity to remind foreign firms that any ambition to ramp up business in or with Iran is short-sighted, ill-advised, and fraught with risk to shareholders, directors, officers, employees, agents, contractors, lenders, and business partners. The MOU has not eliminated the extensive legal, regulatory, financial, operational, cybersecurity, reputational, and geopolitical risks associated with the Iranian market. Indeed, many of those risks have become more pronounced since UANI first published its assessment. Companies contemplating engagement with Iran should carefully evaluate not only the possibility of future sanctions relief but also the broader and enduring risks that continue to accompany commercial activity involving the Islamic Republic.

The Iran Business Risks: Updated

The risks inherent in doing business in Iran are serious and fall into at least 15 distinct categories:

1. Sanctions Volatility and Regulatory Uncertainty

The legal and regulatory environment governing business with Iran remains highly unpredictable. The withdrawal of the United States from the Joint Comprehensive Plan of Action (JCPOA) in 2018 and the subsequent reimposition of sweeping U.S. secondary sanctions demonstrated how quickly international commercial opportunities can disappear. Companies investing in Iran remain exposed to rapidly changing sanctions regimes, executive actions, legislative developments, and regulatory enforcement by the United States and other governments. Even if sanctions are eased in the future, there are no assurances that such relief will be durable, creating significant uncertainty for long-term business planning and investment.

2. Impairment of Corporate Reputation

A company that seeks opportunities in a country widely associated with sponsorship of terrorism, regional destabilization, and serious human rights abuses risks significant reputational damage. Iran continues to face international condemnation for its support of sanctioned militant and terrorist proxy organizations, arbitrary detention of foreign nationals, and brutal denial of political and religious freedoms. Consumers, shareholders, business partners, lenders, and the general public may view commercial engagement with Iran negatively, resulting in reputational harm that can outweigh any short-term commercial gains.

3. Banking and Financial Services Risk

Financial institutions remain reluctant to facilitate transactions involving Iran because of sanctions exposure, anti-money laundering concerns, and regulatory uncertainty. Many international banks continue to limit or refuse Iran-related business, making financing, payment processing, trade finance, and cross-border transactions difficult or impossible. Companies may encounter significant delays, increased compliance costs, limited access to correspondent banking services, and heightened scrutiny from financial regulators, creating substantial barriers to ordinary commercial activity.

4. Exposure to Sanctioned State-Affiliated Entities

Doing business in Iran almost inevitably means doing business—directly or indirectly—with organizations affiliated with the Islamic Revolutionary Guard Corps (IRGC) or other sanctioned entities. The IRGC maintains extensive influence across numerous sectors of the Iranian economy through subsidiaries, front companies, joint ventures, charitable foundations, and complex ownership structures. Even sophisticated compliance programs may be unable to identify concealed ownership or control, exposing companies to significant legal, financial, and reputational risks arising from inadvertent dealings with sanctioned parties.

5. Continuing Economic Sanctions and Trade Restrictions

Notwithstanding periodic U.S. negotiations with Iran, numerous sanctions unrelated to Iran's nuclear program remain in force. These measures target terrorism, ballistic missile development, human rights abuses, cyber activities, weapons proliferation, and other conduct. As a result, many sectors of the Iranian economy remain subject to significant restrictions that prohibit or severely limit commercial engagement. Companies must navigate overlapping sanctions imposed by multiple jurisdictions, creating an exceptionally complex compliance environment.

6. Unavailability and Deficiency of Insurance Coverage

Companies operating in Iran may find that their business operations, personnel, assets, and investments are either uninsurable or subject to limited coverage and substantially higher premiums. Political instability, sanctions exposure, terrorism, armed conflict, and legal uncertainty increase underwriting risks and reduce the willingness of insurers to provide comprehensive protection. Businesses may therefore be forced to assume financial risks that would ordinarily be transferred through commercial insurance.

7. Impairment of Shareholder Value

Investors increasingly evaluate companies based on legal, geopolitical, and ethical considerations in addition to financial performance. A company's pursuit of short-term commercial opportunities in Iran may expose shareholders to sanctions risk, litigation, regulatory investigations, reputational damage, and increased compliance costs. Institutional investors, pension funds, and other stakeholders may conclude that the financial and reputational risks associated with Iran outweigh any potential returns, negatively affecting shareholder value.

8. Impairment of Future Business Opportunities

Companies that expand commercial relationships with Iran may jeopardize future business opportunities in countries that oppose Iran's regional policies or maintain close security partnerships with the United States. Governments, state-owned enterprises, and private-sector partners in other markets may reconsider commercial relationships with firms perceived to be supporting or financing the Iranian regime. The resulting loss of contracts, investment opportunities, or market access may substantially exceed any profits earned in Iran.

9. Arrest, Detention, Kidnapping, and Personal Security Risk

Companies conducting business in Iran expose their officers, employees, contractors, and consultants to significant personal security risks. Foreign nationals and dual nationals have been detained, prosecuted, or imprisoned under opaque legal processes, often without meaningful access to legal counsel or due-process protections. Political tensions, arbitrary law-enforcement actions, and an unpredictable judicial system increase the possibility of detention, travel restrictions, harassment, or other serious threats to personnel operating within the country.

10. Cybersecurity and Intellectual Property Risk

Companies operating in Iran face elevated risks of cyber intrusion, intellectual-property theft, industrial espionage, ransomware, and unauthorized access to proprietary information. State-sponsored cyber actors and affiliated organizations have demonstrated sophisticated capabilities targeting government agencies, financial institutions, critical infrastructure, and private industry. Businesses should expect heightened threats to trade secrets, confidential business information, customer data, employee records, and other sensitive digital assets.

11. Export Controls and Technology Restrictions

Companies seeking to do business in or with Iran face increasingly complex export-control restrictions imposed by the United States and other governments. These restrictions extend well beyond traditional military goods and now encompass advanced electronics, software, telecommunications equipment, aerospace technology, artificial intelligence, encryption products, and numerous dual-use items. Even products developed for purely commercial purposes may require export licenses or be prohibited for export altogether. Companies that fail to implement robust export-control compliance programs risk severe civil and criminal penalties, loss of export privileges, costly enforcement actions, and long-term damage to their international business operations.

12. Supply Chain and Third-Party Due Diligence Risk

Conducting business in Iran presents extraordinary supply chain and third-party compliance challenges. Iranian companies frequently operate through complex ownership structures, intermediaries, shell companies, and affiliates that obscure their true ownership and control. As a result, foreign companies may unknowingly conduct business with sanctioned entities or organizations acting on behalf of the Islamic Revolutionary Guard Corps (IRGC) or other designated parties. Even extensive due diligence may fail to identify hidden relationships, exposing companies to sanctions violations, regulatory enforcement, contract disputes, financial losses, and significant reputational harm.

13. Regional Conflict and Operational Disruption Risk

The increasingly volatile security environment throughout the Middle East creates substantial operational risks for companies conducting business in Iran. Armed conflict, missile and drone attacks, terrorism, maritime incidents, border closures, cyberattacks, disruptions to commercial shipping, and interruptions to aviation can occur with little or no warning. Companies may be forced to suspend operations, evacuate personnel, abandon projects, or absorb substantial financial losses resulting from force majeure events. The potential for broader regional conflict further increases uncertainty about long-term investment decisions.

14. Environmental, Social, and Governance (ESG) and Human Rights Risk

Investors, lenders, regulators, customers, and civil society organizations increasingly evaluate corporate activities through the lens of environmental, social, and governance (ESG) principles and internationally recognized human rights standards. Companies conducting business in Iran may face heightened scrutiny regarding relationships with government-controlled entities or industries associated with corruption, repression, arbitrary detention, censorship, discrimination against women and minorities, and other human rights concerns. Such involvement may result in shareholder activism, divestment campaigns, adverse media coverage, consumer boycotts, and increased regulatory disclosure obligations that negatively affect corporate reputation and shareholder value.

15. Anti-Money Laundering and Financial Crime Compliance Risk

Companies operating in or with Iran face elevated risks associated with anti-money laundering (AML), counter-terrorism financing (CTF), sanctions evasion, and other financial crimes. Financial institutions and multinational corporations must devote substantial resources to enhanced customer due diligence, beneficial ownership verification, transaction monitoring, and regulatory reporting in order to identify and prevent prohibited transactions. The costs of maintaining effective compliance programs can be considerable, while compliance failures may expose companies to substantial fines, criminal liability, regulatory enforcement actions, restrictions on access to international financial markets, and lasting reputational damage.