Bermuda-based companies have been banned from conducting business with the Iranian Bank Mallat and the Islamic Republic of Iran Shipping Lines.

Attorney General Kim Wilson gave the directive yesterday, the first day the Anti-Terrorism (Financial and other Measures) Amendment Act came into effect. Businesses have until Tuesday to inform the Ministry.

Senator Wilson said: "In the past, financial institutions have been prohibited from doing business with certain persons and entities as a result of international sanctions, but this is the first time that we have been able to take this type of action to protect the national interest of Bermuda.

"Further, this legislation allows us for the first time, to specifically take action to address matters relating to the financing of the development of nuclear and other such weaponry for destructive purposes."

The companies have been banned because they have been involved in funding and shipping sensitive nuclear and ballistic missile material in defiance of five United Nations' Security Council Resolutions.

Sen. Wilson added that she did not know how many, if any, companies were conducting business with the two Iranian companies.

"I am pleased that we have once again taken positive steps to further strengthen our ability to combat money laundering and terrorist financing in Bermuda and we have a strong and effective anti-money laundering and terrorist financing regime," she added.

The new Act means that Bermuda can now respond to advisories issued by the Financial Action Task Force and the United Nations.

Wiliam Kattan, Director, Legal Services and Enforcement at the Bermuda Monetary Authority said in a statement: "The action taken by the Attorney General's office to restrict Bermuda based companies from conducting business with Iranian Bank Mallat and the Islamic Republic of Iran Shipping Lines is a clear demonstration of Bermuda's commitment to follow through on its new anti-money laundering anti-terrorism financing (AML/ATF) framework.

"The Authority is pleased to have been a part of the multi-agency effort that established this new robust framework for Bermuda. The Authority has been given expanded powers to supervise financial institutions and insurers that fall within the scope of directions issued by the Minister of Justice under the new legislation, in order to ensure compliance with those directions.

"In 2008 the Authority worked along side the Ministry of Justice and the National Anti Money Laundering Committee to develop a suite of legislation to enhance Bermuda's AML/ATF provisions in line with the Financial Action Task Force's 40+9 recommendations, the international standard for AM/ATF regulations."