"Japan needs to take stern action against Iran as the maintenance of nuclear non-proliferation is believed to be closely related to North Korea's nuclear issues," Foreign Minister Taro Aso told a news conference.

Tokyo has taken the hardest line against neighbouring North Korea over its nuclear program and has also joined the international community in sanctioning Iran, previously blacklisting 12 individuals and 10 organisations.

One of the organisations penalised Friday is Iran's state-run Bank Sepah, which is thought to have links to Tehran's nuclear development, said a foreign ministry official on the customary condition of anonymity.

"The bank now cannot operate new deals with Japanese companies," he said, without identifying all of the organisations and individuals.

The sanctions also include a more comprehensive ban on arms trade with Iran, covering ships that load containers in the Islamic Republic.

"Japan already has banned arms imports and exports with Iran," the official said.
"But from today, items such as bullet-proof vests and helmets are even banned for import from Iran," he said, a move that is expected to be largely symbolic.

The United Nations has adopted two resolutions imposing sanctions on Iran for defying calls to halt its sensitive uranium enrichment work. Tehran denies Washington's charge that it seeks nuclear weapons.

In March, the UN Security Council gave Iran 60 days to suspend enrichment or face further punitive measures, a deadline that expires next week.

Despite being a close US ally, Japan has maintained close trade ties with Iran, which supplies 15 percent of its oil imports.