The order gives the Secretary of Commerce authority to determine whether a foreign country “directly or indirectly purchases, imports, or otherwise acquires” Iranian goods or services by evaluating trade flows and tracing origin through intermediaries and third countries; the order explicitly lets Commerce issue rules, regulations, and guidance and to make determinations after consulting appropriate senior officials, with findings reported to the Secretary of State. In short: Commerce will use transaction- and supply‑chain evidence (including intermediary or third‑country routing) and may adopt implementing rules to decide when Iranian origin can “reasonably be traced” as the order requires.
Under the order, “goods or services from Iran” is to be construed consistent with OFAC’s regulation 31 C.F.R. 560.306 — i.e., Iranian‑origin goods and services (including items that have entered Iranian commerce, goods owned/controlled by the Iranian government, and items that can be traced to Iran even if they transited third countries). The order narrows the term further to only those goods or services that U.S. persons are prohibited from trading in under U.S. Iran sanctions.
The order does not name countries; Commerce will identify them using the same tracing/transaction criteria described in the order (direct purchases or indirect acquisitions traceable to Iran). Countries with significant trade, transit, or intermediary roles for sanctioned Iranian exports (historically: China, Turkey, UAE, Iraq, and some neighboring states) are likely candidates, but actual designations will depend on Commerce’s findings and implementing rules.
The order authorizes an additional ad valorem duty (gives 25% as an example). The process: Commerce finds a country sources Iranian goods/services, informs State; State (with Treasury, Commerce, DHS, USTR) recommends whether and at what rate to impose a tariff; the President makes the final decision. Implementation tools include rules, Federal Register notices, and Customs/CBP collection at entry based on country‑of‑origin/product classification once the tariff is announced.
The order explicitly continues the national emergency declared in EO 12957 and builds on prior Iran executive orders and existing sanctions authorities (IEEPA, National Emergencies Act, Trade Act). It supplements OFAC/ITSR prohibitions by adding a tariff tool targeted at countries that trade with Iran; it does not repeal prior sanctions and delegates implementation to Cabinet agencies consistent with existing law and OFAC regulation definitions.
The order requires the Secretary of State, consulting Treasury, Commerce, DHS, and USTR, to recommend whether and to what extent tariffs should be imposed and to monitor changing circumstances; the President may modify or lift tariffs if Iran or affected countries take significant remedial steps or if retaliation or new information justifies changes. The order also authorizes agency rules and Federal Register notices to set procedures and criteria for modification.
Practically, targeted tariffs could raise costs for importers of affected-country products (passed to U.S. businesses or consumers), complicate supply chains that use intermediaries or components routed through third countries, and prompt trade diversion or retaliation by affected countries; Customs would collect the duty at entry based on product origin, so importers and logistics firms will face compliance and documentation burdens. Economic impact depends on which countries/products are designated and tariff rates imposed.