UPDATE 3-Canada to lift Tehran sanctions, allow Bombardier to export to Iran

(Adds reaction from Bombardier and air industry)
By Randall Palmer and Allison Lampert
OTTAWA/MONTREAL, Jan 26 (Reuters) - Canada confirmed for the
first time on Tuesday that it plans to lift its sanctions on
Tehran and said that if Airbus AIR.PA is allowed to sell to
Iran, then its aircraft maker Bombardier Inc BBDb.TO should be
allowed to export there as well.
"If Airbus is able to do it, why (will) Bombardier not be
able to do it? In which way (is it) helping Canada, or the
Iranian people, or Israel, or anyone, that Canada is hurting its
own industry?" Dion said in an exchange with reporters.
Asked specifically if Bombardier would be allowed to do
business with Iran as soon as sanctions are lifted, Dion said:
"Legitimate business, certainly."
Iran announced plans at the weekend to buy more than 160
European planes, mainly from Airbus, and Dion said reluctance to
lift sanctions on the part of Canada's Conservative opposition
had helped Airbus and not Bombardier.
The United States, the European Union and other major
nations have already lifted some of their own punitive measures.
"Canada will lift its sanctions but what Canada will
maintain is our suspicion of a regime ... that must not return
to (trying to obtain) nuclear weapons," Dion told the House of
Commons moments before meeting journalists.
Dion also said Iran had a poor human rights record and was
not a friend of Canadian allies such as Israel.
Dion said any lifting of sanctions would be done carefully
in conjunction with allies, seeking to ensure nuclear and other
military activity is prevented.
Bombardier spokeswoman Marianella de la Barrera called
Dion's comments a positive step but said that the company was
still respecting the Canadian sanctions.
"We're monitoring it very closely," she said. "Nothing
official has been communicated to us."
She said sanctions had not prevented Bombardier from
speaking with Iran about its aviation needs: "It doesn't
preclude us from engaging in strategic discussions, which we are
doing."
Montreal has the third-largest aerospace hub in terms of
employment, following Toulouse and Seattle.
Suzanne Benoit, president of Aero Montreal, which represents
the aerospace sector there, said it would be excellent news for
the industry if the embargo is lifted.
"Right now we are not in a fair competition with Airbus
because Airbus can sell to Iran."
Iran is looking to upgrade its aging fleet partly with
aircraft with the same range and seats as Bombardier's 100- to
150-seat CSeries.