To Save the Iran Nuclear Deal, Europeans Trigger a Process That Could End It

(Stratfor)

France, Germany and the United Kingdom, the so-called E3 grouping of signatories to the Iran nuclear deal, announced on Jan. 14 that they were triggering the dispute resolution mechanism of the Joint Comprehensive Plan of Action (JCPOA) in hopes of getting Iran to come back into compliance with the accord. The E3 had telegraphed its decision for weeks; it arrives as the United States has called on the E3, China and Russia to pull out of the JCPOA and negotiate a new agreement with Iran.

The Europeans Hope to Drag Out the Process

Despite increased pressure from the United States, the E3 said they were "not joining a campaign to implement maximum pressure against Iran," and that their intent was to "preserve" the Iran nuclear deal. While it is unrealistic for Iran or the United States to rejoin the agreement both have now abandoned, the Europeans don't want to see the two years of diplomatic negotiations leading to the deal go for naught and think the JCPOA should be used as the starting point toward a new agreement. Right now, the Trump administration is not even considering that option.

Triggering the dispute resolution mechanism starts a process that could bring back U.N. Security Council sanctions on Iran within two months. But an accelerated settlement does not appear to be the E3's intent. As long as all the parties agree, most of the steps in the dispute resolution process can be extended for an indefinite period. The Europeans will likely try to drag out the process as long as possible and use it as leverage to force Iran into new negotiations. They probably recognize that Iran is unlikely to go back into full compliance with the deal itself, barring a major reversal in U.S. sanctions policy. So, they will hope that by initiating the process that could "snap back" U.N. and EU sanctions on Iran, they can deter Tehran from taking more aggressive actions with its nuclear program.

What to Watch for

Iran's next moves will be important. The new year already has brought the biggest crisis between Iran and the United States in decades and one that easily could have resulted in the United States striking targets inside Iran. With President Donald Trump insisting that Iran will never acquire a nuclear weapon on his watch, a U.S. military response to further escalation on the nuclear front by Tehran is possible. This possibility, coupled with the European position, could prompt Iran to slow the pace at which it is willing to resume aspects of its nuclear program, though Iran is likely to continue some degree of nuclear escalation.

With Trump insisting that Iran will never acquire a nuclear weapon on his watch, a U.S. military response to further escalation on the nuclear front by Tehran is possible.

The United Kingdom's position is also important. British Prime Minister Boris Johnson said on Jan. 14 that the JCPOA could be replaced with a "Trump deal," and it's possible the United States will try to exploit any daylight that emerges between the United Kingdom's position and the rest of Europe given the close relationship between London and Washington.

The next moves by the United States also will be critical. The Trump administration will push France, Germany and the United Kingdom to go quickly through the dispute settlement process, but currently, the U.S. position is that it is no longer a party to the nuclear deal. But if the Europeans seek extensions and allow the dispute process to slow, the Trump administration could argue that it is a party to the JCPOA and go straight to the U.N. Security Council to argue that Iran is in noncompliance with its commitments. The Security Council resolution regarding the nuclear deal does not require JCPOA members to use the accord's dispute resolution process in order to determine noncompliance. And if the United States makes that determination then U.N. sanctions snap back on Iran unless the Security Council — subject to a U.S. veto — passes a resolution to extend sanctions relief for Iran. Russia and China could, however, reject the U.S. ability to trigger such sanctions, and not recognize them.

The closer we get to October, when the U.N. arms embargo on Iran expires under the JCPOA, the more likely it is the United States will attempt such creative arguments to try to bring back the U.N. sanctions on Iran. As we wrote in our 2020 Annual Forecast, Iran's continued nuclear escalation and the possible U.S. argument to snap back sanctions on Tehran will likely result in "either the de facto or de jure end of the Joint Comprehensive Plan of Action."