Europe Considering Blocking Iran Sanctions If US Leaves Nuclear Deal, EU Ambassador Says

Eyeing an Oct. 15 deadline, European diplomats are lobbying the Trump administration to stay in the Iran deal.

WASHINGTON ― European diplomats warned the Trump administration on Monday that Europe is prepared to block U.S. efforts to reimpose international sanctions against Iran as long as Tehran continues to comply with its obligations under the nuclear deal.

If the U.S. pulls out of the nuclear agreement ― known as the JCPOA ― and reapplies sanctions that target not only Iran, but other countries who do business with Iran, the European Union could take advantage of a statute dating back to the mid-1990s that would protect European companies from being penalized under the sanctions, EU ambassador to the United States David O’Sullivan said Monday.

“We have the blocking statute ... which does offer legal protection to European companies which are threatened by the extraterritorial nature of U.S. sanctions in certain circumstances, Sullivan said, speaking at the Atlantic Center alongside French, British and German ambassadors. “I have no doubt that if this scenario materializes, which it’s not clear it will, the European Union will act to protect the legitimate interests of our companies with all the means at our disposal.”

Because Washington has virtually no trade relations with Tehran, U.S. sanctions against Iran aren’t an effective nuclear deterrent unless other countries join the effort. In the years leading up to the 2015 nuclear deal, European countries, as well as China and Russia, cooperated with U.S.-led efforts to choke off Iran’s economy in hopes of persuading Iran to negotiate restrictions on its nuclear program. But now that Iran has scaled back its nuclear program in exchange for sanctions relief, the countries that helped negotiate the JCPOA see no reason to cut off trade with Tehran again.

The warning from the EU ambassador came ahead of an Oct. 15 deadline, when President Donald Trump has to inform to Congress whether Iran is complying with the nuclear deal. That deadline is the result of legislation passed by Congress in 2015 that requires the president to make several certifications to lawmakers every 90 days.

Those certifications go beyond the technical requirements set forth in the JCPOA. One certification, for example, requires the president to confirm that providing sanctions relief to Iran is “vital to the national security interests” of the U.S.

The International Atomic Energy Agency, the organization tasked with monitoring the use of nuclear technology, confirmed last month for the eighth time that Iran was complying with the JCPOA. But the subjective nature of the reporting requirements in the law passed by Congress means that Trump could opt to decertify Iranian compliance, even as the IAEA says Tehran is fulfilling its obligations.

If Trump does not certify Iranian compliance, Congress has 60 days to decide whether to fast-track legislation to reimpose nuclear sanctions, a move that Iran would likely claim is a violation of the agreement.

European countries face an awkward situation if the U.S. reimposes sanctions against Iran without definitive evidence that Iran has breached the nuclear deal. They will have to choose between breaking publicly with a key ally or losing credibility by failing to honor a diplomatic agreement.

Trump said last week that he had decided what he will do on Oct. 15, but he’s keeping his decision a secret ― even to U.S. allies who are party to the agreement. He met with British Prime Minister Theresa May for 50 minutes last week in New York but didn’t tell her whether the U.S. would continue to enforce the JCPOA, British ambassador Kim Darroch said Monday.

Trump has called the Iran deal an “embarrassment” to the U.S. and made clear his preference to scrap the agreement and replace it with one that also constrains Iran’s ballistic missile program and has indefinite restrictions on its nuclear program (some provisions in the current deal sunset after 10-15 years). The president has ordered an interagency Iran policy review as part of an effort to come up with an alternative to staying in the JCPOA. That review is still ongoing.

Amid this uncertainty, European diplomats have lobbied the Trump administration and lawmakers to continue providing sanctions relief in exchange for Iran abiding by strict caps on its nuclear program and allowing intrusive IAEA inspections.

They have said that they are interested in negotiating additional agreements with Iran to address its nonnuclear policies ― but they warn that scrapping the nuclear deal will only make it harder to constrain Tehran in other areas, including over Iran’s ballistic missile program, and its support for Hezbollah in Lebanon, Houthi rebels in Yemen, and President Bashar al-Assad in Syria.

“In a sense what this administration has been saying since it came into office has changed the climate already for Iran,” Darroch said. “So it’s succeeding. And we would say let’s carry on with that, let’s intensify our discussion … take some decisions on the way forward on all these issues, but let’s keep the JCPOA.”

European diplomats were cautious on Monday not to criticize Trump, but it was clear they were frustrated by his insistence that it would be easy to reach a new agreement more favorable to the West.

“This was a multilateral agreement with difficult partners,” French ambassador to the U.S. Gérard Araud said, referring to Iran, China, and Russia, whose national interests are often at odds with U.S. and European interests. “Anybody who says we [could] get the perfect deal with those kinds of partners is just dreaming.”

The Europeans say they can’t tell if their lobbying efforts have been effective ― and they don’t expect to find out until the rest of the world does.

“Do I think we have changed the President’s mind?” Darroch said. “I think we’ll wait and see what happens” in October.

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