TEHRAN, Jun. 11 (Press Shia Agency) – Iran’s Parliament will be holding an extraordinary session this week to review the contracts on joint ventures between Iranian and French carmakers as the European side has suspended projects to avoid US sanctions.

A member of Iranian Parliament’s Committee on Industries and Mines told Mehr News correspondent on Monday that an extraordinary session will be held, most likely this week, to review the type of contracts signed by Iran Khodra and Saipa with the French carmaker Peugeot-Citroen (PSA) and its rival, Renault.

“The Citroen project is almost finished in Kashan, and the machineries for new productions have been installed,” said Abdollah Razian, adding “therefore, we are not certain what policy the PSA will adopt in response to the US new sanctions.”

On June 5, the French carmaker PSA Group announced its decision to suspend joint venture activities in Iran “to comply with US law by Aug. 6,” when the sanctions are about to snap-back into place.

Razian noted that the suspension of Citroen project in Iran would deal a considerable amount of damage to the French company as the contracts signed with Citroen were more solid than the ones signed with Peugeot and Renault, and as such all damages due to abandoning the project would fall on the French side.

The Iranian MP went on to add that while Renault and Peugeot have not yet made any serious investment in Iran’s automotive industry, the Citroen group has already made its investments, installed its equipment and is expected to introduce its cars to the market by June 21.

He said that the Parliament session would review the contracts to see what kind of guarantees have been obtained from these two French companies that would allow Iran to receive compensations for the suspension of the projects.

Razian further added that Iran’s car industry would continue to work with the Chinese side while European companies were pulling out from projects due to US sanctions, but voiced concern that the situation might cause price hikes in the Iranian market.