Iran dismissed the move and a separate US warning that major powers would not wait forever for Tehran to prove it was not developing nuclear bombs, saying any threats would have no impact.
The order applies to Bank Mellat and Islamic Republic of Iran Shipping Lines, both of which have previously faced sanctions from the US.
Making an order under counter-terrorism laws rather than UN sanctions, Britain said it was convinced Iran’s disputed nuclear programme was a threat to its security.
“The Treasury is satisfied, as required by the Act, that activity in Iran that facilitates the development or production of nuclear weapons poses a significant risk to the national interests of the UK,” Treasury minister Sarah McCarthy-Fry said in a statement to parliament.
The Treasury said it welcomed talks between Iran and six world powers, including Britain, but said that action was needed now against the two businesses, accusing them of links to nuclear weapons and ballistic missile programmes.
A Treasury spokesman said: “When the government identifies such activities, it is committed to curtailing them.”
The action follows criticism of Iran from US Secretary of State Hillary Clinton and British Foreign Secretary David Miliband at a news conference in London on Sunday.
Iran, which says its nuclear work is for peaceful electricity generation, agreed at a meeting in Geneva on October 1 to allow UN inspectors access to a uranium enrichment plant near the city of Qom.
The Islamic state has rejected demands to halt its sensitive nuclear work, despite three rounds of UN sanctions since 2006. Progress in the Geneva talks was seen as heading off calls for an immediate round of tougher sanctions.
But Iran warned Britain over its latest move. “If the British government decided to impose sanctions against Iran this would show that Britain is getting far from the realities of the current world and such a trend will be against the interests of the British people,” Ali Akbar Javanfekr, a media adviser to President Mahmoud Ahmadinejad said.
Iranian Foreign Ministry spokesman Hassan Qashqavi reiterated Iran’s refusal to discuss its “nuclear rights”.
“We have announced several times that we have nothing to discuss regarding that,” he told a Tehran news conference.
The British statement said: “Vessels of the Islamic Republic of Iran Shipping Lines have transported goods for both Iran’s ballistic missile and nuclear programmes.
“Similarly, Bank Mellat has provided banking services to a UN listed organisation connected to Iran’s proliferation-sensitive activities, and been involved in transactions related to financing Iran’s nuclear and ballistic missile programme.”
North Korea fired five short-range missiles off its east coast yesterday, news reports said.
South Korea’s Yonhap news agency said the North test-fired two short-range missiles yesterday and three more from mobile launch pads.
Yonhap said the missiles had a range of up to 75 miles (120 kilometres).
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