S. Korea Foreign Ministry Says Iran's Assets to be Unlocked through Consultations with US

The Iranian assets locked in South Korea will be released after consultations with the United States, the South Korea foreign ministry said Tuesday, after Iran claimed it has reached a deal with Seoul on how to transfer and use the frozen money. According to Iran's government website, the agreement was reached Monday during the meeting between Governor of the Central Bank of Iran (CBI) Abdolnaser Hemmati and South Korean Ambassador to Iran Ryu Jeong-hyun. It said that the two sides agreed on the destinations for the transfer and that the Iranian central bank informed Seoul of the amount of the money it wants to be transferred.

Tehran has been pressuring Seoul to unblock about US$7 billion of its assets frozen in two South Korean banks due to U.S. sanctions. Seoul has been in talks with Washington on ways to release the money without violating the sanctions, including expanding humanitarian trade with the Middle Eastern country.

"Our government has been in talks with Iran about ways to use the frozen assets, and the Iran side has expressed its consent to the proposals we have made," the South Korea foreign ministry said without providing further details of the proposals. "The actual unfreezing of the assets will be carried out through consultations with related countries, including the United States," the ministry said.

According to Iran's Mehr News Agency, Governor of Central Bank Abdolnaser Hemmati, Welcoming the change of approach of South Korea,  stated that although Islamic Republic of Iran welcomes the change in approach of countries and increased cooperation, the legal pursuits of this bank to claim damages due to non-cooperation of Korean banks in the recent years will remain in place, so that Korean side should make its utmost effort to eliminate the negative record occurred between the two countries in this regard.

Earlier this month, a foreign ministry official said Seoul was finalizing talks with Washington about using some of the frozen funds to pay Tehran's U.N. dues in arrears, to which the Islamic republic has also agreed. To facilitate the trade with Iran of humanitarian items, such as medicine and medical equipment, South Korea has been seeking to use a Swiss channel backed by the U.S., known as the Swiss Humanitarian Trade Arrangement (SHTA), to use the money through Swiss companies' sales of goods to Iran.

Despite the denial from Seoul and Tehran, speculation has mounted that Iran's discontent over the frozen funds is related to its recent seizure of a South Korean oil tanker and its crew members in the Persian Gulf early last month. Early this month, Tehran said it would release the sailors, except for the captain, which coincided with Seoul's confirmation on the progress in the talks with Washington about using the frozen money for the U.N. dues. - Yonhap, Mehr