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 The hitherto unknown firm was "ready, willing and able" to buy
four used Airbus A340 jets for which Kim was trying to broker a
sale.
"I talked to them and when I got the Letter of Intent with an
Iranian name, I informed them that a deal was not possible because
of sanctions," Kim, managing director of British-based aircraft
trading company AvCon Worldwide, told Reuters.
The company that tried to buy them, registered in a Nicosia
apartment with two directors with names that sounded Iranian,
vanished from the radar, Kim said in a telephone interview.
The planes, for which there is little demand, remain with their
Asian owner but the suspected approach typifies a shadowy trade in
airplanes and parts that spanned the globe for decades.
Suspected front firms sought to trade in spare parts and even whole
aircraft, according to people involved in the trade and other
experts who mostly spoke on condition of anonymity.
"The Iranians would set up companies to try to do deals and then
fold them up. They didn't stay around for long," said Kim.
 The methods used to evade sanctions mirror those used in other
countries that are or have been under international sanctions in
recent decades, such as South Africa, Cuba, Zimbabwe, Iraq and North
Korea.
After the lifting of nuclear-related sanctions on Jan. 16, Iran's
aviation industry is coming out of the shadows.
With an order for 118 Airbus jets witnessed in Paris by President
Hassan Rouhani, Iran moved swiftly to exchange a collection of
vintage jets held together with smuggled parts for a new fleet
capable of taking on rival Gulf carriers.
Like Cuba's preserved 1950s automobiles, the aircraft they will
replace symbolize the ingenuity wrought by sanctions but also the
scale of the task needed to reconnect the economy.
"Our strategy until now has just been to survive," Iranair chairman
Farhad Parvaresh said.
AIRLINE "MASTERMINDS"
At Tehran's airport, rows of mothballed aircraft still sit with
bright orange covers on their engines, ready to give up their parts
for other old planes needing repairs.
Through constant patching, transplants from grounded donor jets and
discreet purchases, Iran's fleet stayed aloft although with an
alarming safety record.
"It was state-of-the-art 'Under the Table'," Heydar Vatankhah,
deputy managing director for engineering and maintenance at Iran's
Kish Air, said of the overall effort.
"Every airline has a mastermind on this," he said.
Vatankhah spent 31 years helping to maintain an ancient fleet at
state-owned Iranair including the world's oldest passenger 747,
built in 1976 before the majority of Iranians were born, according
to aviation consultancy CAPA, which organized an aviation summit in
Iran in January.
One Iranian airline official, who asked not to be identified, said
he had obtained a Western-built engine weeks after it left the
factory by passing it through three countries.
 While Iran says it can manufacture parts, the preference was for
genuine components, but they came at a price.
"It's simple. If this costs $10,000, I had to pay $70,000," the
engineering chief of an Iranian airline said, waving a can of soda
to illustrate his point.
Others said they paid four or five times over the odds.
As they did so, the middlemen prospered.
"After decades of doing this you see a lot. Everyone takes their
cut. It's a dirty business," the engineering chief said.
As confidence grew, a smuggled jet flew directly to Tehran Mehrabad
airport, a former senior Iranian official said.
However, Iran's covert resupply operation clashed increasingly with
foreign law and intelligence agencies.
The United States has targeted dozens of front companies suspected
by diplomats of links to Iran's elite Revolutionary Guards, widely
seen as a beneficiary of the sanctions trade.
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"They (the West) listened to our calls and read our emails; of
course we knew that," said one airline employee.
"But we are commercial people, not military men," he said, adding
the deals had been elusive but not always complicated.
"They know where the wall is, but not where the hole is," he added.
NEW AMBITIONS, NEW CHALLENGES
The United States last year imposed sanctions on two firms in Iraq
and the United Arab Emirates for helping Iran's Mahan Air purchase
second-hand aircraft.
The airline, Iran's largest, was blacklisted in 2011 for allegedly
ferrying operatives, arms and funds for the Revolutionary Guards'
overseas unit. It remains under sanctions.
Iran says it has been forced to use the black market to preserve
safety following fatal accidents and sanctions that prevented it
from gaining access to parts and manuals. The West says the
sanctions were effective in convincing Tehran to negotiate the
recent deal on curbing its nuclear activities.
"It was a great suffering for all of us, so we haven't been able to
develop in this field," lawmaker Mahdi Hashemi, head of the
parliament's Development Commission, told the CAPA event.
Now, Iran's plans to absorb 500 new aircraft in the next decade look
set to turn the well-worn system of improvised repairs and
clandestine purchases on its head.
As middlemen dissolve into the post-sanctions landscape, with many
of them expected to reinvent themselves as legitimate partners for
investors, the airlines must contend with foreign regulators and
insurers whose mindset is compliance.
The can-do mentality which kept Iran's rotting fleet flying through
sanctions will be less welcome in future.
That means airlines must adapt to a forest of norms required by
manufacturers, investors, lenders, lessors and regulators, said Mark
Tierney, director of Crabtree Capital, which provides strategic
advice and transaction execution services for airlines, aircraft and
engine-leasing companies and financial institutions.
The problems of resuming normal operations do not end there.
A revolution in plane design has taken place while Iran was off the
market. While mastering every nut and bolt of the Boeing 747, its
engineers must get used to new types like the A350.
"The level of training and technology in airlines to be able to
bring those aircraft in and operate without problems doesn't happen
overnight," Dick Forsberg, strategy chief of leasing company Avolon,
told a panel of Iranian officials.
Even with sanctions lifted, airlines may struggle to get some
existing aircraft repaired while waiting for the new European jets,
to which Iran hopes to add over 100 Boeings.
Many are so riddled with contraband parts that they would be
unlikely to pass muster with repair shops, an engineer said.
In response, Airbus has agreed to help Tehran comply with foreign
regulators and to provide repairs and training: crucial steps as
Iran rebuilds its aviation industry from scratch.
(Editing by Timothy Heritage)
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