Europe's Divergence over Dispute Resolution Mechanism with Iran: Reasons and Scenarios

EPC | 19 Feb 2020

Europe's rift over Iran's nuclear deal continues to persist. While Britain and France take hardline positions, Germany and the EU foreign policy team continue to show understanding of the Iranian stances. However, this rift does not mean that the Iran nuclear deal, also known as the Joint Comprehensive Plan of Action (JCPOA), will remain unchanged. Other parties to the agreement might follow the U.S.  path and withdraw from the deal, without necessarily leading to the collapse of the deal or putting the Iran's nuclear program back on the UN Security Council's table.

Contrary to the Iranian consensus on how to deal with the United States, the Iranian regime appears divided over its relationship with Europe and how to approach the Europeans, amidst a steady decline in Iranian-European relations.

Two Differing European Stances on Iran’s Deal

During a recent visit by the EU High Representative/Vice-President Josep Borrell to Tehran, Mahmoud Vaezi, Chief of Staff of the Iranian President, said the dispute resolution mechanism, which the European Trio threatened to trigger after the recent Iranian escalation, will likely not be activated. This statement was preceded by a series of escalations related to the deal which was put under a hard test following the U.S. withdrawal and re-imposition of sanctions on Iran, and Tehran's scrapping of some of its commitments under the agreement, the latest of which is almost tantamount to a waiver of the whole deal.

On the European side, French President Emanuel Macron said that the world will not stand idly by over the Iranian nuclear recklessness, and that an agreement that includes new aspects, chief of which is the Iranian missile program, is needed. Britain, though, was clearer. British Prime Minister Boris Johnson called for endorsing Trump's proposal on a new nuclear deal with Iran instead of the current agreement, to include, along with the nuclear program, both the missile program and Iran's regional expansion. Amid this escalation, the European trio announced in a statement that it is activating the dispute resolution mechanism stipulated in the nuclear agreement in case either party abandons its commitments. This comes in response to the recent Iranian escalation, placing Iran one step away from the UN Security Council, and the potential of falling under Chapter VII of the UN charter and the reintroduction of UN sanctions.

The Iranian diplomacy team has voiced concern about the accelerating developments and discontent with the European position. A spokesman for the Iranian Foreign Ministry said the European position is illegitimate and indicates failure. Meanwhile, Iranian Foreign Minister, Mohammad Javad Zarif, said the European Union (EU) had sold its independence and prestige and succumbed U.S. blackmail. The German Defense Minister stressed that the European trio’s recourse to activating the dispute resolution mechanism came after the U.S. threatened the Europeans of slapping 25-percent customs duties on car imports from the EU in the event that the trio did not trigger the mechanism. Later, Zarif threatened that Iran would withdraw from the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) in the event that the Iranian nuclear program is referred back to the UN Security Council. Moreover, some members of the Iranian parliament submitted a draft resolution calling for the country’s withdrawal from the NPT. This is despite Vaezi's assurance that Iran has avoided the risk of sending its nuclear program back to the Security Council in particular. Also, Borrell, during his recent surprise visit to Tehran, stressed that the EU will extend the deadline for the dispute resolution mechanism for an unlimited period. Originally, the agreement stipulates that the two parties have a 35-day moratorium to resolve any dispute before recourse to the UN Security Council. This has raised a question about the reasons for the shift in the European position from threatening to activate the dispute resolution mechanism and send the issue back to the Security Council to trying to defuse the crisis and keep the nuclear agreement alive.

If the position that preceded the decision of the European trio to activate the dispute resolution mechanism was the French and British escalatory position, then this position was not purely escalatory on both sides. Nor was it the only position expressed by the European trio, and by the diplomatic body of the EU.

Other European parties maintain a position completely different from that held by Britain and France on the nuclear agreement and how to approach with Iran. Germany, in the words of its defense minister, denounced the U.S. pressure on Europe to withdraw from the nuclear agreement, refusing to bow to Trump's threat policy towards Iran, which it [Germany] saw as a policy that does not lead to adjusting the Iranian position, but rather will lead to Iran's departure from a position of moderation. The German Chancellor, Angela Merkel, also warned in Davos of the consequences of tearing up the Iran's nuclear agreement, saying it would be “wrong to abandon an imperfect deal with nothing better in place”.

Germany's stance was not the only one that differed from the French-British position. Rather, a similar position can be seen held by the diplomatic body of the EU in general, and by the EU High Representative/Vice-President, Josep Borrell, in particular. The latter has already asserted that Iran must abide by all its obligations in exchange for enjoying the privileges guaranteed by the nuclear agreement. Additionally, he has recently said that the EU, which triggered the dispute resolution mechanism, decided to give Tehran an open deadline to avoid referring the Iranian program back to the Security Council, which means "the end of the nuclear agreement." Also, France seems to be readjusting its position. After Macron's strong stance, French Foreign Minister Jean-Yves Le Drian announced that the EU does not intend to end the nuclear agreement altogether, but rather is trying to urge Iran to abide by it.

As a result, the position of the European parties to the nuclear agreement (Britain, France and Germany, along with the diplomatic body of the EU) is not the same regarding the nuclear deal and its developments. There is a clear line separating the British and French position seeking to terminate the nuclear agreement in favor of a comprehensive agreement, from the German and the overall EU position asserting commitment to the nuclear agreement and the need to maintain it. The official statements by the EU are a mix of the two. 

Reasons Behind Germany-EU Positions

Although there are outstanding issues between Iran and the EU, which cannot be underestimated, there are other important reasons behind the diverging European positions on the Iranian issue, including:

  • Germany and the EU’s diplomatic body see the nuclear agreement with Iran as one of their most important opportunities to play a greater role at the international level. It can be said that this issue helped elevate both Germany and the EU to the level of permanent members of the Security Council (which means for each of them and for Germany in particular, making a long-awaited penetration of the walls of the Security Council) and influence several other international issues using the nuclear agreement card. Otherwise, putting the Iranian issue back on the UN Security Council's table will render Germany and the EU role-less in this issue and potentially in other international issues. From this standpoint, Germany, as well as the EU, seeks to keep Iran's nuclear program out of the Security Council.
  • The team controlling the foreign policy body of the EU, from Javier Solana (1999-2009) to Josep Borrell now, has maintained contacts with the Iranian regime, unlike the U.S. administration. This relationship was more apparent during Federica Mogherini's tenure, and now Borrell (both leftists). This rapprochement has been translated between the EU foreign policy body and Iran in the latter playing an active role in Iran's nuclear issue culminating in the JCPOA, the U.S. withdrawal from which is seen an attempt to undermine the whole deal. Notwithstanding the EU team's consistent stance over Iran's nuclear deal over the past few years in particular and on how to approach Iran in general (The Iranian government clearly depend on this consistent and close position, and therefore it welcomed the appointment of Borrell), it does not necessarily mean it reflects the European trio's stance or that of EU member countries.
  • The German government has traditionally leaned toward a position independent of the United States. However, the role of the Iranian lobby of deputies of Iranian descent in the German parliament should not be ignored in bridging the rift between Iran and Germany, and trying to produce a German position that does not undermine Iranian interests in general. These efforts were clearly evident in the November protests, which prevented the German government from taking a strong position on the Iranian regime along the lines of the British and French positions.

Besides, several other marginal reasons can be pointed out that help in understanding the reasons for the different position between the British-French duo on one hand and Germany and the EU on the other, including:

  1. The fact that there some outstanding disputes between France and Britain on one hand, and Iran on the other. These problems include Iran's detention of British nationals (Nazanin Zaghari-Ratcliffe, Nazanin Zaghari-Ratcliffe) and French citizens (Fariba Adelkhah, and Roland Marchal) on charges of espionage, which makes their stance harder on Iran.
  2. Iran's escalatory maneuvers (represented in changing Iran's nuclear strategy, withdrawal from the NPT, and expanding the threat circle to include European soldiers, according to President Rouhani) if the European side tries to refer Iran to the UN Security Council. These are maneuvers that the Iranians know to worry the European side a lot. Tehran does not find a contradiction between its past provocative maneuvers against the EU and its attempts to woo the bloc now by emphasizing the role of the EU in resolving regional differences, something welcomed by EU politicians.
  3. The desire of the EU to play a broader role in international issues, including the Middle East, which are associated with traditional EU-U.S. differences. This, in turn, reinforces the pace of rapprochement between the EU and German diplomacies on the one hand (and largely the French diplomatic body) and the Iranian government on the other.

Clearly, all of these marginal reasons, along with the fundamental reasons, have created a rift in the European position on Iran's nuclear deal. This rift allowed the non-escalation position to prevail, after a short period of hardline positions that pushed the way for the activation of the dispute resolution mechanism.

Scenarios

In light of the positions of the various European parties, and the seemingly not insignificant divergence between them over the nuclear agreement with Iran, several scenarios can be envisaged for the future of these positions, and their implications for the agreement amid a U.S.-Iran escalation:

First Scenario: Germany Continuing to Hold Ground. This scenario assumes, according to an upbeat Iranian vision, that the EU’s Iran policy will be guided by the German position, which calls for non-escalation and attempting to keep the nuclear agreement alive. There is evidence of the likelihood of this scenario, in light of the shifting hardline French position. France’s position could change to a position close to that of the Germans and the EU foreign policy coordinator, in the wake of Britain’s exit from the EU. Any potential shift in France position might also be driven by a traditional French desire to preserve a dividing line with the U.S. Meanwhile, the EU's dependence on the German economy to overcome its crises may play an important role in further promoting the German vision. According to this scenario, a continued European pro-Iran deal position and refusal to refer the issue to the Security Council is a possibility. However, there are obstacles that might render this scenario difficult to materialize. These include outstanding issues between Iran and Europe, such as human rights which play an important role in European public opinion, and Iran's ballistic missiles program that European countries are concerned about. Such concerns might invite an EU review of the agreement to include the ballistic missiles program as well. This scenario cannot overlook a possible U.S. economic pressure on the EU.

Second Scenario: Collapse of the European Position in Favor of the U.S.'s. Unlike the first scenario, this scenario assumes the collapse of the European stance in favor of the so-called "Trump agreement". According to this scenario, U.S. pressure tools (of which the U.S. has many and can utilize against the EU, such as the introduction of tariffs on EU exports and withdrawal from existing agreements, chief of which is NATO) might reverse the EU position. These threats proved effective when the Trump administration hinted at imposing customs duties on the EU auto exports, which brought the European side in line with Trump's policy, and triggered the dispute resolution mechanism. In addition, the U.S. has other tools it can leverage within the EU itself.  Likewise, these tools proved effective when the U.S. resorted to rallying its European allies under an anti-Iran coalition during a 2019 Poland conference. But the stumbling block to this scenario is whether the U.S. administration really intends or can deploy these levers while it is engaged in a trade war with China or in an elections year.

Third Scenario: Persistence of intra-European Divergence. This scenario assumes the continuation of the rift between the European stakeholders. That is, a hardline approach pursued by Britain and France to logical limits against Germany and the EU foreign policy team showing understanding of Iran's position. According to this scenario, the U.S. may not go too far in deploying its pressure tools against the EU, but this does not necessarily mean that the Iran nuclear agreement will remain as it is now. Also, one may think of Britain and France abandoning the agreement without the move necessarily heralding the total collapse of the deal or sending Iran back to the UN Security Council. Needless to say, this scenario is Iran's favorite as it strives to sustain the agreement even if only on paper. It can also be assumed that this is an acceptable scenario for several international parties; because it prevents a major Iranian escalation, and keeps the door open to dialogue that may lead to a broader agreement.

 

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