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The P4+1 and Iran Nuclear Deal Alert, May 30, 2018
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Arms Control NOW

Authored by Kelsey Davenport on May 30, 2018


Joint Commission Discusses U.S. Withdrawal

Representatives from the P4+1 and Iran met in Vienna May 25 to discuss the implementation of the nuclear deal known as the Joint Comprehensive Plan of Action (JCPOA) after U.S. President Donald Trump reimposed sanctions and withdrew from the agreement.

While officials from the P4+1 (China, France, Germany, Russia, and the United Kingdom) and Iran have met over the past several weeks, this was the first meeting of the Joint Commission, a body set up by the JCPOA to oversee implementation of the accord, since Trump’s May 8 announcement. The Joint Commission meets on a quarterly basis but can be convened on short notice at the request of any party. Iran requested the May 25 meeting, which was held at the political director level. It was preceded by a meeting of the sanctions-lifting working group, also established by the JCPOA.

Going into the meeting, Iranian Deputy Foreign Minister Abbas Araqchi said Iran was looking for the Europeans to “specifically tell us how they can guarantee Iran’s interests.” He said Iran has not yet decided if it will stay in the JCPOA or leave it.

According to the chair’s statement, the parties “regretted” the U.S. decision to withdraw and reimpose sanctions and noted that the JCPOA is a “key element of the global nonproliferation architecture.” The parties also noted that lifting sanctions “allowing for the normalisation of trade and economic relations with Iran constitute essential parts of the JCPOA.”

During the meeting, the P4+1 and Iran reviewed the “potential impact of the re-imposition of U.S. sanctions” and options to preserve “the interests of businesses and investors engaged with Iran.” Discussions were aimed at finding “practical solutions” for the continued sale of Iranian oil and petrochemical products, banking transactions, provision of export credit, and practical support for trade and investment. The joint statement also called for “continued sea, land, air and rail transportation relations with Iran.”

Iran proposed another meeting of the Joint Commission, this time at the ministerial level, to continue discussions on sanctions-lifting and options to preserve the benefits of the JCPOA.

International Atomic Energy Agency (IAEA) Director General Yukiya Amano also participated in part of the meeting, and the chair’s statement noted that the agency just released its 11th report confirming Iran’s continued adherence to the limits set by the deal. The IAEA’s Board of Governors will consider the report during its regular meeting June 4-8 in Vienna.—KELSEY DAVENPORT, director for nonproliferation policy


EU Discusses Options to Block U.S. Sanctions

The European Commission agreed unanimously May 16 to formally launch a process to activate its blocking statute, which prohibits European entities from complying with U.S. secondary sanctions, and a process to allow the European Investment Bank to consider finance activities in Iran. The Commission also encouraged states to “explore the possibility of one-off bank transfers” to the Central Bank of Iran, which could facilitate oil payments.

Following the Commission’s decision, the EU Foreign Affairs Council discussed the JCPOA during its May 28 meeting in Brussels. Mogherini said that members agreed to continue working on measures to protect European investments in Iran. Individual states also put “concrete ideas” on the table to complement EU steps. Iranian officials have requested specifics on the EU response by the end of May, but Mogherini said there is no definitive timeline for presenting the package to Iran, saying that “serious measures in a serious complex situation take time.”

Mogherini emphasized a “strong political message of unity” by the EU, but comments from Poland’s Foreign Minister Jacek Czaputowicz raised doubt about whether a consensus exists to take certain EU actions in response to the U.S. violation of the nuclear deal. Czaputowicz said May 28 that Poland opposes action that would weaken U.S. sanctions. He told the press that some states “tie their security to the United States security” and want to preserve the trans-Atlantic partnership.

The EU decision to adopt measures like the blocking regulation that prohibits EU companies from cooperating with U.S. secondary sanctions will be made by consensus, meaning one state can prevent passage.


Pompeo’s “Plan B” is Unrealistic

U.S. Secretary of State Mike Pompeo laid out the administration’s plan for getting a ‘better deal’ with Iran. In a May 21 speech at the Heritage Foundation, Pompeo tried to build the Trump administration’s case for pursuing a new agreement with Iran that goes beyond the country’s nuclear program.

What Pompeo failed to articulate is how that “better deal” is possible, given that key U.S. allies and Washington’s former partners in the deal soundly rejected Trump’s reckless decision to abandon the 2015 agreement, and given that there is no support in Tehran to renegotiate another deal that demands more.

Pompeo’s criteria for a “better deal,” includes a ban on uranium enrichment and reprocessing in perpetuity. Pompeo also called for “unqualified access” for IAEA inspectors to all sites, a “full account” of the prior military dimensions of its nuclear program, an end to ballistic missile proliferation, and a stop to launching and developing nuclear-capable ballistic missiles. The “better deal” would also require Iran to stop support for terrorist groups in the Middle East, such as Hezbollah, and Hamas.

To get there, he said the United States would build the “strongest sanctions in history.” Pompeo, however, failed to explain the U.S. strategy for getting the international community on board with sanctions.

In the lead up to negotiations in 2013, EU measures played a critical role in pressuring Iran to engage in talks, as did Chinese and Russian support for U.S. measures. All these states opposed Trump’s decision to violate the nuclear deal by reimposing sanctions and the EU is actively considering measures to block the application of U.S. sanctions. Other states, such as India, have also announced that they will only abide by UN sanctions on Iran and will not follow U.S. sanctions. Without strong international support, the United States will not be able to build the sanctions leverage to push for Trump’s “better deal.”

The Arms Control Association’s immediate reaction to the Pompeo speech is posted here.


Lawmakers Respond to Trump’s ZTE Comment

Trump sent mixed messages about sanctions implementation May 13 when he tweeted that the United States would work with China to get Chinese telecom company, ZTE, “back into business, fast” to save jobs in that country.

Trump’s comment pledging support for a known Iran sanctions violator is at odds with statements from other officials pushing for foreign entities to abide by the reimposed measures. Richard Grenell, U.S. Ambassador to Germany, said May 8 “German companies doing business in Iran should wind down operations immediately.”

ZTE pled guilty to violating U.S. sanctions on Iran and North Korea and obstructing justice in 2017. According to the Depart of Commerce, ZTE “conspired to evade” the U.S. embargo on Iran between 2010 and 2016 in order to “supply, build, operate and/or service large-scale telecommunications networks in Iran” using U.S.-origin equipment and software. As part of the settlement, ZTE was fined $1.2 billion and agreed to institute new procedures and audits.

Senator Chris Van Hollen (D-Md.) said Trump’s statement was “deeply troubling” given ZTE’s history as a “repeated and flagrant violator” of U.S. laws.

Van Hollen secured bipartisan support for language in the Foreign Investment Risk Review Modernization Act that prohibits the president from changing penalties on Chinese telecommunications companies that have violated U.S. sanctions until the president certifies that entity is no longer in violation of U.S. law and has been so for a year.

For more information on the ZTE case, see the Wisconsin Project on Nuclear Arms Control’s May 18 piece “Letting ZTE Off the Hook, Again? Implications for Iran Sanctions Enforcement.


Iran’s Missile Work Continues

The New York Times broke a story May 23 detailing activity at a previously unknown missile facility in the Iranian desert. Satellite imagery analyzed by the Middlebury Institute of International Studies point toward development of long-range missile technology at that site.

Iran has publicly stated it would limit its ballistic missiles to a range of 2,000 kilometers, and the systems tested in recent years fell within that range. But images of the Shahurd Facility indicate Iran is testing rocket motors that are much more powerful than what is necessary for a 2,000-kilometer system.

Ballistic missile development is not a violation of the JCPOA. However, UN Security Council Resolution 2231, which endorsed the nuclear deal, calls upon Iran “not to undertake any activity related to ballistic missiles designed to be capable of delivering nuclear weapons.” That prohibition is nonbinding, but the United States has passed additional sanctions on Iran since Resolution 2231 entered in force, charging that Iran’s ballistic missile activity is contrary to the intent of the resolution.

The existence of the facility underscores the critical need to sustain the JCPOA. Iran’s ballistic missiles are troubling, but the systems would be a lot more threatening if Tehran’s nuclear program is unrestrained. Additionally, if the deal collapses, it makes negotiations with Iran on other areas—like ballistic missiles—much more difficult because Tehran is unlikely to view any offer as credible.

Iran did not comment on The New York Times story, but Deputy Foreign Minister Abbas Araqchi reiterated again May 27 that Iran will not negotiate on its ballistic missiles.


Trumps JCPOA Decision Undercuts Long-Term Value of Sanctions

The lack of support for reimposing sanctions on Iran – and direct defiance in the case of the EU and others – not only jeopardizes the future of the JCPOA, it also risks the efficacy of sanctions as a foreign policy tool.

Elizabeth Rosenberg, director of the Energy, Economics, and Security Program at the Center for a New American Security, describes the unintended consequences of Trump’s decision in a May 15 Foreign Policy article. In addition to arguing that lack of cooperation and support for U.S. measures will make enforcement more difficult, Rosenberg points out that the broad new measures will “encourage some countries to explore an array of alternative financial conduits to Iran, from barter to blockchain, to shield their banks and companies from U.S. jurisdiction. “

Rosenberg also argues that “these measures may ultimately weaken the strength of sanctions as a tool of U.S. statecraft. Limited or uneven compliance with the sanctions will contribute to the impression that sanctions do not work, which will make countries less likely to heed them in the future.” That makes maintaining pressure on an array of countries from Russia to North Korea more difficult.


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Author: 
Kelsey Davenport