There are just 18 days left until Washington’s May 12 deadline for the United States and the European Union to reach an agreement about how to counter Iran’s regional activity and whether to tighten the straitjacket on its nuclear program. Iranian Foreign Minister Javad Zarif has spent much of the last week in the United States on a media blitz, trying to push back against the United States, while French President Emmanuel Macron had Iran at the top of his agenda during his April 24 meeting with Trump. During the meeting, Macron presented the possibility of a new deal to complement — not replace — the Iran nuclear deal, formally known as the Joint Comprehensive Plan of Action (JCPOA). He outlined four main concerns to address when countering Iran, which included the JCPOA’s short-term concerns but also long-term concerns about Iran’s nuclear program, its ballistic missile program and its regional activities in places such as Syria.
The United States is looking for ways to pressure Iran, and it's willing to risk the nuclear deal to extract more support for constraining Iran’s regional activities. But if the deal fails, Iran will need to make a choice between alienating European powers by restarting its nuclear program and acting more pragmatically.
But Trump has continued to disparage the JCPOA. The president even called it “insane” while meeting with Macron, casting doubts that the United States would extend critical sanctions waivers on May 12 that enable Iran to receive precious economics benefits — including financial, energy and trade sanctions relief — in exchange for concessions involving its nuclear program. Since Trump took office, those benefits have been hanging in the balance, causing Iran to examine its options in case all or some of them are removed.
The Least Severe Next Step for Iran
The degree to which Iran responds depends on whether the United States reinstates all sanctions on Iran or merely a subset of them. But Iranian officials have so far outlined four different options which range in severity. And right now, with Tehran already dealing with an economic crisis at home, it could choose options that try to appeal to the European Union, at least initially, as a way of shielding itself from the most significant U.S. sanctions. After all, the effectiveness of unilateral U.S. sanctions has historically been drastically diminished without support from partners.
The first — and perhaps most appealing option from the European Union’s perspective — option would be to utilize the JCPOA’s dispute resolution mechanism. The big challenge here for Iran, however, is that the Article 36 dispute resolution mechanism was built under the assumption that the United States or other Western powers, not Iran, would need to implement it. The mechanism is designed to punish Iran and allow the United States and others to reintroduce sanctions on Iran if need be. Zarif noted that Iran has already filed 11 informal complaints to the JCPOA’s Joint Commission Chair Federica Mogherini, and said his country could file a formal one in the future based on the United States' behavior.
But the United States would not face any penalty if this happens. If Iran triggers Article 36, it would kick off a 15-day review period where the Joint Commission would either evaluate and hopefully resolve the complaint or refer it to the ministerial level, where ministers would also have 15 (possibly concurrent) days to resolve the complaint. If that process fails, the JCPOA would form a three-member advisory board with representatives from the complaining country (Iran), the accused country (the United States) and one independent member. The board would issue a non-binding opinion within 15 days, after which the Joint Commission would have five days to accept or reject it. If the issue is still not resolved, the complaining country could refer the matter to the United Nations Security Council, where the United States could veto any resolution and have justified grounds to suspend its own commitments under the JCPOA. In total, this process would take around 35 days.
The Other Options
Iran has three other realistic options beyond the dispute process. It can:
- Immediately pull out of the JCPOA and restart aspects of its nuclear program.
- Ease the application of the additional protocol that gives inspectors from the International Atomic Energy Agency easier access to its nuclear sites.
- Withdraw from the Treaty on the Non-Proliferation of Nuclear Weapons.
Any one of these actions — all of which Iran has threatened at various points — would represent a more serious response and risk damaging Iran’s relationship with the European Union. Because of this, Iran would not take such action lightly. So, though it is both convoluted and ineffective, going through the JCPOA dispute process may well be Iran’s first move. The decision would allow Iran to earn international credibility from the European Union, China and Russia, which could help the country as it tries to influence the European Union to push back against U.S. sanctions. If those efforts fail and the Iranian economy starts to deteriorate more significantly under the United States' unilateral sanctions, Tehran may embrace more significant reactions.