"The nuclear deal with Iran, in which Britain played a major role, makes the Middle East and the wider world a safer place", the British minister said in a statement.
Iranian Foreign Minister Mohammad Javad Zarif and European Union’s Foreign Policy Chief Federica Mogherini on late Saturday announced in a joint statement that the implementation of the nuclear deal known as JCPOA has officially been started.
Britain was one of the six major powers who struck July's deal with Iran, which sees it limit its nuclear programme in exchange for a lifting of sanctions.
Hammond said that "years of patient and persistent diplomacy, and difficult technical work, have borne fruit as we now implement the deal."
"There were many sceptics who said Iran would never deliver on its side of the bargain, but the independent International Atomic Energy Agency has said they have," said Hammond, AFP reported.
"Iran's nuclear programme has been substantially rolled back," he added, before urging British businesses to capitalize on the lifting of international sanctions against Iran.
"The future is as important as the landmark we've reached today," he said.