European companies with links to Iran could face a number of sanctions, including the disruption of shipments if they do not immediately begin implementing the current restrictions, which are aimed at increasing pressure on the Islamic Republic by choking off its access to American and European commerce.

Michael Tockuss, general secretary of the German-Iranian Chamber of Commerce says US officials have applied direct pressure on European companies who have failed to comply with the new sanctions, which were introduced by the Donald J. Trump administration after Trump pulled the US out of the 2015 Iran nuclear deal. There has been little pushback from the EU as the individual governments in Europe and the European Union institutions, themselves, out of fear that they, themselves, will be targeted by the sanctions

Secondary sanctions are not unusual, but how vigorously they are enforced varies, especially via-a-vis allies. German officials have accused the US Ambassador in Berlin, Richard Grenell, of overreach as he took to Twitter to warn German companies to halt their business with Iran “immediately.”

A number of EU companies have announced their withdrawal from the Islamic Republic, including Renault, TOTAL, Volkswagen, Daimler, Maersk, and Allianz. However, companies that do not export in the US often opt to continue trade with Iran.

The Hamburg-based and Iranian-owned Bank Melli was warned in October that Deutsche Telecom (DT) would cut off phone and internet services after the latter was threatened with secondary sanctions if it continued to receive payments from Iran. DT owns a US subsidiary, T-Mobile.

The Brussels-based messaging system ‘SWIFT’ used by most of the world’s lenders for payments duly fell in line with the US sanctions in November 2018, suspending Iranian banks from its activities.

The EU has gone slightly further than the national governments and private companies in Europe by announcing that it would not only protect its trade with Iran but also introduce legislation to punish EU-based companies that decide to abide by the US’ sanctions. The EU also unveiled what has been dubbed a “Special Purpose Vehicle”, or SPV, designed to circumvent US sanctions by facilitating barter trade.

Introducing the SPV had been discussed for months, but none of the 28 EU countries wanted to host the controversial mechanism as many European governments have become less accommodating towards the Iranian government following Tehran’s continued involvement in the civil wars in Syria and Yemen and information that the intelligence wing of Iran’s Revolutionary Guard Corps planned to carry out several assassinations on European soil.

There are unconfirmed reports that European Union legislation has helped convince several European companies that were eager to leave Iran to avoid having to explain to European regulators why they suddenly opted to leave the Islamic Republic.

Correction: An earlier version of this article claimed US officials have accused the US Ambassador in Berlin, Richard Grenell, of overreach. The article has been updated to reflect that it was German officials and not US officials who reacted.