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Iran’s Uranium Enrichment Has U.S. Weighing Sanctions ‘Snapback’

Iran's Uranium Enrichment Has U.S. Weighing Sanctions ‘Snapback’

(Bloomberg) -- Iran’s decision to ramp up uranium enrichment is prompting debate over whether the U.S. should -- or even can -- invoke a threat that negotiators built into the 2015 nuclear agreement but hoped would never be used: a “snapback” of international sanctions.

Although President Donald Trump withdrew from the accord last year, the administration is being pressured by some American hard-liners to invoke a mechanism that ultimately would trigger a return to United Nations Security Council sanctions beyond those the U.S. is already imposing unilaterally.

Such a move, if successful, would shred what’s left of European-led efforts to keep the multinational accord alive, and analysts and diplomats say it would be galling coming from the nation that was first to quit the deal.

Iran’s Uranium Enrichment Has U.S. Weighing Sanctions ‘Snapback’

“Do I think there’s an argument to be made for snapping back? Sure,” said Richard Nephew, who was the lead sanctions expert for the Obama administration team that negotiated the 2015 accord. “Do I think the rest of the council agrees? No. It’s not clear people would stay in their chairs during discussions if we invoked this.”

Nephew, now a senior research scholar at Columbia University, said the snapback was designed to give the U.S. unilateral privileges to restore sanctions through the Security Council. At the time, the provision was a major part of Secretary of State John Kerry’s pitch for Congress to acquiesce to the deal. It’s also something that an “America First” president like Trump would like.

Under the snapback clause, any of the signatories to the Iran accord can cite Iran for violating the deal in a complaint to a dispute resolution committee. The matter eventually could be brought before the Security Council, which could vote on a resolution to keep the previous sanctions from going back into force. But the U.S. could get its way by exercising its veto on the council.

It’s no easy fix: The process could take two months or longer. And the Trump administration’s standing to initiate the snapback provision may be undercut by its position that it’s no longer a member and doesn’t participate in the nuclear accord’s “joint commission,” which as the deal’s dispute resolution body is responsible for referring violations to the Security Council.

“They just don’t have the support to even try that,” said Daniel Tannebaum, head of the global financial sanctions unit at PricewaterhouseCoopers LLP.

To get around criticism that the U.S. doesn’t have standing to call for snapback sanctions, American officials are leaning on France and the U.K. to consider exercising the provision. The Europeans are signaling they’re not at that point yet, but they are using the American threats to put pressure on Iran to restrain itself, according to Western diplomats at the UN.

A senior European diplomat whose country still supports the accord said any decision to implement the snapback wouldn’t be automatic but predicted that support for it will grow unless Iran’s government changes its behavior.

A trio of hard-line U.S. senators say the White House doesn’t need to wait for the Europeans to start the process and that language in the nuclear accord still allows the U.S. to initiate a snapback.

“Your administration has refrained from invoking the snapback mechanism in United Nations Security Council resolution (UNSCR) 2231, which if invoked would restore international restrictions against Iranian uranium enrichment, plutonium-related heavy water work, and ballistic missile development,” Republican Senators Ted Cruz, Marco Rubio and Tom Cotton said in a letter to Trump.

The UN resolution defines “the United States as a participant for the purpose of invoking the mechanism,” they said. “We urge you to do so."

Using Pressure

Even without the snapback provision, the U.S. has instituted punishing sanctions targeting Iran’s oil exports and its broader economy. European nations have been trying to salvage the deal by offering barter provisions that would sidestep the U.S. banking system -- with little success so far -- even as they warn Iran against continuing to violate the deal’s limits on uranium enrichment.

Iran’s Uranium Enrichment Has U.S. Weighing Sanctions ‘Snapback’

In a briefing last month, Majid Takht-Ravanchi, Iran’s ambassador to the UN, told reporters that his country wants to remain in the accord but that Europe needs to deliver stronger economic incentives, and quickly.

Against that backdrop, tensions between the U.S. and Iran have surged. The Trump administration has blamed Iran in recent weeks for sabotaging oil tankers near the the Strait of Hormuz and for downing an American drone over international waters. Tehran denies it was behind the tanker attacks and says the drone was shot down over its territory.

Resisting the U.S.

A meeting in Vienna on Wednesday foreshadowed just how explosive any efforts for a snapback would be. The U.S. sought a special meeting of nuclear inspectors to increase pressure against Iran. Instead, the Americans drew pushback from Russia, China and Europe, all of whom blame the Trump administration for the crisis.

France, Germany and the U.K. issued a joint statement on the eve of the meeting saying that while they were concerned by Iran’s violations, it’s the job of the remaining participants in the deal, known as the Joint Comprehensive Plan of Action, to address disputes.

“The EU deeply regrets the U.S. withdrawal and calls on all countries to refrain from taking any actions that impede the implementation of the JCPOA commitments,” it said.

Trump, who has a long history of pushing allies and adversaries toward the edge of conflict, will have to decide if it’s time to test the snapback provision.

"It is certainly a topic of significant ongoing conversation within the administration," Cruz of Texas said in an interview. "We should invoke those sanctions.”

--With assistance from Jonathan Tirone, Patrick Donahue and Nick Wadhams.

To contact the reporters on this story: David Wainer in New York at dwainer3@bloomberg.net;Daniel Flatley in Washington at dflatley1@bloomberg.net

To contact the editors responsible for this story: Bill Faries at wfaries@bloomberg.net, Larry Liebert

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