Dimitar Dilkoff, AFP | French President Emmanuel Macron at the European Summit in Sofia on 17 but 2018.

The EU said Thursday it would move to block the effects of new US sanctions on European firms doing business with Tehran as EU nations sought to mitigate the fallout from the US decision to withdraw from the Iran nuclear deal.

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US President Donald Trump last week controversially pulled Washington out of the 2015 international deal with Iran that placed limits on its nuclear programme in return for easing economic sanctions.

French President Emmanuel Macron said Thursday his country will not get into a trade war against the United States, despite France's disapproval of the decision to withdraw from the nuclear deal.

Speaking at a press conference after an EU summit on the Iran nuclear deal in the Bulgarian capital Sofia, Macron said: "We're not going to choose one camp over another. We're not going to be the allies of Iran against the United States of America."

The EU leaders pledged in Sofia to keep a united front against Trump, whose decisions to pull out of the Iran deal and to impose trade tariffs on Europe have triggered the worst transatlantic crisis since the invasion of Iraq in 2003.

Commenting on an announcement Wednesday from French energy giant Total that it would halt a multibillion-dollar natural gas project in Iran unless it was granted an exemption from US sanctions, Macron said he wants to provide guarantees for European firms that want to do business with Tehran.

EN NW SOT 1 MACRON 17H

But he added: "We're not going to pressure French businesses to stay in Iran. The president of the French Republic in not the CEO of Total."

German Chancellor Angela Merkel struck a more pessimistic note, signalling that it wouldn't be feasible to offer wide-ranging compensation to European companies affected by new US sanctions over Iran's nuclear programme.

"We can see whether we can give small and medium-sized companies certain relief," she said. "That is being examined."

"As for compensating all businesses in a comprehensive way for such measures by the United States of America, I think we cannot and must not create illusions," she added.

EU’s ‘blocking statute’

European companies that have invested in Iran are already taking fright, with Danish shipping giant Maersk and German insurer Allianz joining Total in saying they may have to wind down activities there.

European Commission chief Jean-Claude Juncker said the bloc would introduce measures on Friday to ease the effect of US sanctions on European companies.

“We will begin the ‘blocking statute’ process, which aims to neutralise the extraterritorial effects of US sanctions in the EU. We must do it and we will do it, tomorrow morning at 10:30,” Juncker said at the Sofia summit.

REPLAY - EU Council President Donald Tusk delivers speech

The “blocking statute”, a 1996 regulation originally created to get around Washington’s trade embargo on Cuba, prohibits EU companies and courts from complying with specific foreign sanctions laws. It decrees that no foreign legal judgments based on these laws have any jurisdiction within the European Union.

‘Not a joke’

European Council President Donald Tusk renewed attacks on Trump at the summit on Thursday, suggesting the US administration was now as unpredictable as Iran’s regime.

“The real geopolitical problem is not when you have an unpredictable opponent or enemy, the problem is if your closest friend is unpredictable. It’s not a joke now,” Tusk told a news conference with Juncker.

Tusk on Wednesday slammed Trump’s “capricious assertiveness”, comparing him to Europe’s traditional adversaries Russia and China, and saying Trump’s approach had left the EU with “no illusions” that it could rely on anyone else.

China and Russia were also signatories of the nuclear accord, and have said they will stick to the deal if Tehran respects its terms. Beijing and Moscow have joined Europe in stepping up efforts to save the agreement.

Both nations have also recently made some of their most concrete moves yet to extend their economic influence in Iran.

On Thursday, a Russian-led trade bloc signed an interim trade deal with Iran and signalled plans to negotiate a free-trade zone. In the Kazakh capital Astana, the Russia-led Eurasian Economic Union trade bloc signed an interim trade deal with Iran that lowers tariffs on hundreds of goods.

Russian firms have less to lose from bucking US sanctions, as many Russian companies are already operating under US sanctions imposed over Moscow’s seizure of Crimea and its role in the Ukraine crisis.

Beijing has signalled that it intends to continue "normal and transparent practical cooperation with Iran". Iran’s oil minister said that Chinese state-owned oil company CNPC was ready to replace Total on its gas field project in Iran if the French firm withdraws.

(FRANCE 24 with AFP, AP and REUTERS)

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