In October 2020, the ban on trade in conventional weapons with Iran imposed under article 5 of Annex II of the nuclear agreement — which prohibits all countries from trading in such weapons with Iran — will come to an end. The ban was scheduled to last for five years from the day that the agreement came into effect, ending in October of this year. The various parties to the agreement are ramping up their political maneuvers, however, as the US administration and the remaining parties to the agreement appear to hold incompatible positions regarding the end of the embargo.
Disagreement on this article, among others (including article 3 of Annex II), was one of the key factors in the US administration’s decision to withdraw from the nuclear agreement. The issue has now returned to the forefront. According to sources, the US administration is looking for legal avenues available to it under the nuclear agreement (and the dispute mechanism provided for therein) through which it could prevent Iran from obtaining conventional weapons, which has sparked widespread controversy among the parties to the agreement.
The importance of article 5 of Annex II of the nuclear agreement
According to various Iranian officials, including President Hassan Rouhani, the Iranian government considers article 5 of Annex II of the nuclear agreement to be one of its key achievements and a point in its favor. The Iranian government has therefore attempted to persuade conservative forces in the country, such as the Revolutionary Guard and Supreme Leader Khameini, to uphold the agreement despite the US withdrawal. The article clearly has important implications for the balance of power and for US and regional politics:
Such considerations would explain the rapid efforts launched several months ago by the US Secretary of State Mike Pompeo to address the issue of article 5 with a view to preventing Iran from obtaining modern weaponry.
Thus far, US efforts have focused on encouraging its European partners to withdraw from the agreement in order to force its collapse before October 2020, and while the three European States parties to the agreement announced that they would withdraw if Iran continued to ignore its obligations under the agreement, they have yet to take any concrete action. US efforts have also focused on encouraging the European States to implement the dispute resolution mechanism as a way of eliminating Iran’s chances of seeing the end of the embargo in October 2020, by returning to the international sanctions lifted by resolution 2231. Initially the European States seemed to be moving in this direction in response to US economic pressure, but such action was stymied by Germany and the European Union. Over the past two weeks, however, the US administration appears to have adopted a new tack. It has become clear that the US administration now intends to use its position as one of the signatories to resolution 2231 and as a member of the Security Council to bring a case against Iran for violating its commitments under an agreement approved by UN resolution. While the USA’s withdrawal from the agreement prevents it from triggering the dispute resolution mechanism, its position with regard to resolution 2231 authorizes it to object to Iran’s violation of its commitments under the agreement.
Iranian officials, including the Minister of Foreign Affairs Mohammad Javad Zarif, have rejected suggestions that the US administration could use the dispute resolution mechanism or other possibilities provided for under the agreement to address the issue, stressing that, as the USA is no longer party to the agreement, it is no longer entitled to use such mechanisms. While China has remained silent on the issue, Russia has also voiced clear opposition to the USA using the mechanism. Although EU representative for foreign affairs Josep Borrell also reiterated that the USA was no longer a member of the agreement and therefore could not use the mechanisms provided in it, the European trio have affirmed that the USA is entitled to raise the issue within the Security Council as it is a permanent member. Pompeo has indicated that the USA does not intend to return to the agreement, stating that the agreement contained serious flaws and that the USA could not accept it. According to Pompeo, the USA intends to instead make use of the options provided for by resolution 2231, to which it is a signatory.
Sources have also indicated that the US administration is attempting to bring a draft resolution before the Security Council to extend the ban on arms sales to Iran. It is therefore clear that the USA is simultaneously testing various options aimed at preventing Iran from obtaining arms trading rights in October 2020.
What is on the horizon? The options available to the USA and the likelihood of their success
Analysis of US positions on the issue shows that the Trump administration is intensifying its efforts on various fronts in order to achieve a freeze on article 5:
Recent US efforts have shown that, while the USA is committed to achieving an extension to the arms embargo with Iran, it does not have unified approach to achieving that goal (for several reasons, including the fact that numerous bodies have an influence over US decisions on the issue). Given the capabilities offered by the nuclear agreement to all parties, and the capabilities and limitations of the USA as a Security Council member, the following conclusions can be drawn:
Possible scenarios: These scenarios are based on the general conclusions drawn in this paper, and can be divided into two based on their likelihood of occurring. The less likely scenarios include those that assume that the USA is able to extract a new Security Council resolution imposing a long-term ban on arms trade with Iran or to trigger a dispute resolution mechanism as a signatory to resolution 2231. Despite the USA’s efforts, these scenarios seem highly unlikely, given the general consensus that the USA is no longer a member of the agreement and given that China or Russian may use their veto to thwart any new resolution on the matter unless the USA can persuade them to adopt a neutral position during such a vote, which seems unlikely to happen. The following scenarios are more likely:
Scenario 1: The USA pushes the United Kingdom into triggering the dispute resolution mechanism: In this scenario, the USA is able to use the dispute mechanism via one of its European partners. As it will be difficult (although not impossible, given recent developments and US pressure) for the USA to mobilize all the European parties to support the decision to trigger the dispute resolution mechanism, the US administration may rely instead on its closest ally among the European parties, namely the United Kingdom, to take the lead in that regard. This scenario, which circumvents the participation of the Russian and Chinese veto-holding partners, draws on the mechanisms provided for in the nuclear agreement. The United Kingdom would request the implementation of the dispute mechanism, even though the UN resolutions that were overruled by resolution 2231 carried longer-term sanctions for arms dealing with Iran. A compromise may therefore be reached, in which Russia and China agree to extend the ban on trade in conventional weapons with Iran in order to prevent a return to the implementation of all resolutions that preceded resolution 2231.
Scenario 2: Iran succeeds in preserving the nuclear agreement until October 2020: This assumes that Iran is able to delay proceedings enough to keep the agreement in place until October, at which point the embargo will be lifted. In this scenario, Iran would then be able to use alternative sources of finance to obtain advanced Russian (and Chinese) weapons that would enable it to substantially upset the balance of power between it and the Gulf States, particularly if it can obtain advanced technologies for manufacturing tanks and planes. Although Iran is working hard to this end, it faces a number of obstacles, including pressure from the USA and Europe and the possibility that sanctions may be imposed on Russia if it supplies Iran with such weapons. While the continued imposition of sanctions preventing financial transfers to and from Iran may pose another obstacle, it will not prevent this outcome entirely.
Scenario 3: Compromise: This scenario represents a compromise on the outstanding issues, in which Iran refrains from further escalating its actions to undermine its obligations under the nuclear agreement, in exchange for a commitment from its European partners to uphold the agreement and to provide Iran with reasonable compensation for the US withdrawal. In this scenario, the USA will likely return to the agreement in exchange for Iran voluntarily postponing its return to the arms trade. The Iranian government has indicated its support for this outcome, which has prompted some members of the Iranian parliament to call for a closed session to discuss the country’s approach. This scenario also faces a number of possible obstacles, namely opposition from among conservative forces that do not wish to be drawn into discussion of Iran’s missile activities. It also faces potential US opposition, as this outcome would leave a number issues outstanding, whereas the USA hopes to achieve a comprehensive solution. Nonetheless, this scenario remains the most desirable in the eyes of Iran’s partners in the nuclear agreement and in the eyes of the Iranian regime.
EPC | 12 Jan 2021
EPC | 11 Jan 2021