Iran's Guardian Council, tasked with vetting legislation, rejected legal reforms proposed by the parliament to bring Iran into line with global money laundering norms, the state news agency IRNA reported.
The Council ruled that, according to Iran’s constitution, such legal amendments should be proposed by the judiciary and not parliament, IRNA added.
If parliament insists on its proposal, the issue can be decided by the Expediency Council which can rule in disputes between parliament and the Guardian Council.
Iran has been trying to implement standards set by the Financial Action Task Force (FATF), a global group of government anti-money-laundering (AML) and counter financing of terrorism regimes (CFT), in the hope it will be removed from a blacklist that makes some foreign investors reluctant to deal with it, according to Reuters.
In June, FATF said Iran had until October to complete the reforms or face consequences that could further deter investors from the country, which is already facing a likely return of US sanctions.
Hardliners in parliament have opposed passing legislation towards compliance with FATF standards, arguing it could hamper Iranian financial support for allies such as Lebanon’s Hezbollah.
Iran’s Supreme Leader Ali Khamenei said in June parliament should pass legislation to combat money laundering according to its own criteria. This makes it less likely that parliament would use FATF criteria.
