The Mercedes-Benz logo is seen before the company’s annual news conference in Stuttgart, Germany, Feb. 4, 2016. Photo: Reuters /Michaela Rehle / File.

German car and truck manufacturer Daimler on Tuesday said it has dropped plans to expand its Iran business in reaction to renewed US sanctions, which come into effect on Tuesday.

“We have ceased our already restricted activities in Iran in accordance with the applicable sanctions”, Daimler told Reuters in a statement.

In early 2016, Daimler established a joint venture with Iranian vehicle manufacturer and dealer Iran Khodro Co to make and distribute Mercedes-Benz trucks in the country.

Daimler had planned to open a representative office in Teheran. It the statement, Daimler states that as for now, neither its car-related nor truck-related activities in Iran had been resumed.

Daimler said it continues to monitor political developments carefully.

German daily Stuttgarter Zeitung was first to report Daimler’s retreat from Iran earlier on Tuesday.