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Special Features

The Nuclear Deal: Will Khamenei Get What he Wants?

May 29, 2018
Faramarz Davar
7 min read
European officials are keen to protect businesses that might be affected by US sanctions
European officials are keen to protect businesses that might be affected by US sanctions
On May 24, Ayatollah Khamenei announced his demands for Iran to stay in the JCPOA
On May 24, Ayatollah Khamenei announced his demands for Iran to stay in the JCPOA

Following President Trump’s withdrawal from the nuclear deal, Iranian officials have entered into intense negotiations with the European Union, the United Kingdom, France and Germany to secure guarantees that Iran will continue to benefit from the lifting of nuclear-related sanctions.

On May 24, Ayatollah Khamenei, the Supreme Leader of the Islamic Republic, publicly announced his conditions for Iran remaining in the deal, officially known as the Joint Comprehensive Plan of Action (JCPOA). Throughout the negotiations that led to the deal, which culminated in 2015, Khamenei regularly delivered speeches and set conditions for the talks, so his latest speech is part of that established pattern. 

Two conditions Khamenei set out have already been carried out by Europe, two go against rules of free trade, one is practically unfeasible, while another demand is impossible for Europe — or even Iran —to implement.

So how likely is it that Khamenei will get what he demands? 

1. Khamenei says the US has “violated” the JCPOA for the last two years and that Europe must break its “silence” on this issue and “make up” for its refusal to speak up the past.

During the 28 months or so that the nuclear agreement was in effect with US participation, the JCPOA’s Joint Commission [PDF] met frequently to discuss Iran’s complaints and objections to the ways in which both the Obama and the Trump administrations were carrying out the agreement. In one of the first meetings of the commission, the parties agreed to form a special Working Group on the Implementation of Sanctions. Throughout this time, the commission repeatedly warned the US, issuing statements signed by the European Union and European countries involved.

After Donald Trump — who had referred to the JCPOA as the “worst deal in history” — was sworn in as the president of the United States, European Union officials visited Washington DC many times, holding meetings with Trump, his senior officials and members of Congress with a view to encouraging the US to stay committed to the JCPOA and carry out US obligations under the agreement.

In other words, Europe was not “silent” about US violations and its failures to carry out its obligations under the nuclear deal. On the contrary, when talk about the US leaving the JCPOA started, Europe rushed to persuade the Americans otherwise and to prevent a collapse of the agreement.

2. By leaving the JCPOA, Khamenei says the US has violated Security Council Resolution 2231. The Supreme Leader says Europe must introduce a resolution against this violation.

Any UN member country can introduce a draft resolution at the Security Council, and in this regard there is no difference between Iran, those European countries that are not members of the Security Council and its five permanent members. But it is unlikely and unimaginable that the US would agree to any resolution introduced by Europeans that condemned the United States.

In fact, the right to veto was created so that the permanent members of the Security Council could veto draft resolutions that they view as contrary to their interests and the interests of their allies. Countries that prepare draft resolutions first consult with the members of the Security Council to find out if they have any chance of success. Introducing a resolution without any prospect of approval is not usually done.

3. Khamenei insists that Europe must “guarantee” Iran’s missile program and its “regional policies” will stay off the table and not be part of discussions.

Governments do not give guarantees about issues that have no clear outlines and are subject to change in a volatile environment. The reason for this is that the possible negative consequences of such guarantees cannot be predicted. Issues around Iranian missile programs and Iran’s regional policies — even if major European countries agree with them at this time or, at least do not oppose them — can change in response to developments inside or outside Iran, changes that may mean Europe will no longer agree with Iran’s stance or approach.

For example, if a country such as Iraq or Syria, which currently hosts the Revolutionary Guards, decides it wants the Guards to leave, Iran may well refuse to pull out its troops. The idea that countries can give guarantees about situations with an unknown future and under unstable and changing conditions is something that even Iran would not entertain or accept. Besides, even at the moment, some European countries, including France, Germany and Britain, are critical of Iran’s missile program and have expressed their concerns — the leaders of these countries issued a joint statement on May 8.

4. Europe must oppose “any kind” of sanctions against Iran and “explicitly” stand up to US sanctions, Khamenei insists.

Even before Ayatollah Ali Khamenei announced his conditions, European countries and the European Union had begun to take actions in this regard. Federica Mogherini, the High Representative of the European Union for Foreign Affairs, has said that forcing US domestic laws on Europe is “unacceptable” and that Europe would enact “preventive rules” concerning American sanctions against Iran.

"Preventive rules” mean that the European Union would support those European companies that deal with Iran and might be targeted by the American secondary sanctions. Using these regulations, the European Union hopes to reimburse fines paid by such European companies by confiscating the assets of American entities.

Such a blocking statute has never been used, but the threat of its use forced Washington to back down on planned sanctions against EU trading with Cuba in 1996. In the case of the JCPOA, the EU commission has begun the process to update the dormant regulation. The European Council and European Parliament have two months to express any objections to the move. Otherwise, the law will be introduced on August 4, 2018 — one day before US sanctions are due to be applied. 

In actuality, then, the European Union plans to go even further than what Ayatollah Khamenei has demanded.

5. Europeans should guarantee the complete sale of Iranian oil, according to Khamenei. If the Americans damage Iranian oil sales, the Islamic Republic should be able to sell as much oil as they like, and European countries should agree to buy it.

Iran has a large number of oil customers in Asia. Europe buys less than one million barrels out of around 2.5 million barrels of crude oil that Iran exports per day. Iran’s major European oil customers are in Italy, Spain, France and Greece, most of them private companies and refineries, although in certain cases governments are partial shareholders.

European governments and other countries that adhere to the rules of free trade cannot legally force private companies to buy from specific suppliers. At most, by implementing “preventive rules,” European countries can protect companies that want to continue trade with Iran by compensating them for fines imposed on them.

Forcing companies to buy Iranian oil is illegal. In addition, a guarantee from European governments to buy the oil if private companies refuse to do so is an unenforceable guarantee. In other words, the European Union is unable give the guarantee that the Supreme Leader demands regarding its oil exports.

6. The Supreme Leader demands that European banks guarantee transactions with the Islamic Republic.

Toward the end of Obama’s presidency, the US Secretary of State invited big European banks to work with Iran and, in the presence of the British Foreign Secretary, assured them that cooperating with Iran along the lines approved by the JCPOA puts them in no danger of fines or sanctions. Nevertheless, even though both US and European governments were eager to encourage European banks and other financial institutions to work with Iran as a guarantee that Iran would remain in the JCPOA, these institutions, for a variety of reasons, did not show any enthusiasm to do so.

Most of the European big banks are private and, unlike in Iran, do not take “orders” from the government when choosing their clients or their investments. So forcing them to work with Iran is both against the laws of many European countries and violates the rules and the agreements of the European Union.

So, out of the conditions Ayatollah Khamenei has set for Iran to remain in the JCPOA, two are already being met or pursued by the European Union. The others are either unrealistic or outside the power of European democracies or the European Union to implement.



More on the aftermath of Trump’s withdrawal from the nuclear treaty with Iran:

Khamenei’s Eight Conditions for Talks with Europe, May 25, 2018

Revolutionary Guards Respond to Pompeo’s “Empty Bluff”, May 23, 2018

The 12 Demands of Pompeo's New Iran Strategy, May 21, 2018

When Will US Sanctions Hit Iranian Oil Sales?, May 18, 2018

The JCPOA: A Missed Opportunity, May 17, 2018

The Future of Iran’s Economy as the US Bows Out of the Deal, May 10, 2018

What are Iran’s Choices as US Abandons the Nuclear Deal?, May 9, 2018

Khamenei’s “Heroic Flexibility 2.0”, May 9, 2018

What you Need to Know About Trump and the Nuclear Deal, May 8, 2018




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