Barack Obama, the US president, has signed a wide-ranging defense bill into law, putting into place new provisions that imposing fresh sanctions on Iran. 

The bill imposed tough new sanctions against Iran's central bank and financial sector, marking the sharpest economic confrontation between Washington and Tehran yet.

Officials said Obama signed the bill despite concerns it could complicate his bid to build an international front against Iran. 

The sanctions require foreign firms to make a choice between either doing business with Tehran's oil and financial sectors or central bank, or with the US economy and financial sector. 

Foreign central banks which deal with the Iranian central bank on oil transactions could also face similar restrictions under the new law, which has sparked fears of damage to US ties with Russia and China. 

Obama said in a statement issued as he signed the bill that he was concerned the measure would interfere with his constitutional authority to conduct foreign relations by tying his hands in dealings with foreign governments. 

The bill, which passed with wide majorities in Congress, did reserve some flexibility for Obama, granting him the power to grant 120 day waivers if he judges it to be in the national security interests of the US. 

Senior US officials said Washington was engaging with its foreign partners to ensure the sanctions can work without harming global energy markets, and stressed the US strategy for engaging with Iran was unchanged by the bill. 

EU-Iran talks 

Earlier on Saturday, a European Union foreign policy spokesman said the bloc was open to meaningful talks with Iran provided there are no preconditions on the Iranian side. 

The EU statement was in response to remarks by Ali Reza Sheikh Attar, the Iranian ambassador to Germany, who announced that Iran's top nuclear negotiator, Saeed Jalili, is to send a letter soon to the EU's foreign policy chief to arrange a new round of negotiations over the country's disputed nuclear programme. 

EU foreign policy spokesman, Michael Mann, said in an email to the Reuters news agency that Catherine Ashton, the EU foreign policy chief, wrote to Jalili in October and had not yet had a response. 

"We continue to pursue our twin-track approach and are open for meaningful discussions on confidence-building measures, without preconditions from the Iranian side," he said.  

Attar did not say when the letter would be sent. His comments were reported by the semi-official Mehr news agency on Saturday.

All talks between Iran and major powers, including the latest round in January in Istanbul, have failed so far to achieve any tangible result. 

The main reason is that Iran has constantly rejected the key Western demand - suspension of its uranium enrichment plan as a sign of goodwill until the peaceful nature of the Iranian nuclear programmes are proven.

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Obama said he had 'serious reservations' about how the bill may curtail US counterterrorism abilities.

Aljazeera