Iran has reached an agreement with the European Union and the “P5+1” or “EU3+3” countries (China, France, Germany, the Russian Federation, UK and USA) on a “joint action plan” towards lifting sanctions in exchange for undertakings about Iran’s nuclear programme.
The Joint Plan of Action, agreed by foreign ministers in Geneva today (24 November 2013), sets out “an approach towards reaching a long term comprehensive solution”. The long term solution, in which the Joint Plan of Action is the first step, aims to result in “the comprehensive lifting of all UN Security Council sanctions, as well as multilateral and national sanctions relating to Iran’s nuclear programme” while ensuring that “Iran’s nuclear programme will be exclusively peaceful” and in which Iran “reaffirms that under no circumstances will Iran ever seek or develop any nuclear weapons”.
The plan of action consists of a series of measures to be taken for an initial 6 month period. Iran agrees on a number of undertakings relating to its nuclear programme, and “in return” are a number of “voluntary measures” easing sanctions against Iran.
The White House has published a fact sheet giving some commentary on what has been agreed. It describes these agreements on sanctions as providing “limited, temporary, targeted and reversible relief while maintaining the bulk of [US] sanctions, including the oil, financial and banking sanctions architecture” and states that “if Iran fails to meet its commitments, we will revoke the relief”. The White House states that “without this phased approach, the international sanctions coalition would begin to fray because Iran would make the case to the world that it was serious about a diplomatic solution and we were not. We would be unable to bring partners along to do the crucial work of enforcing our sanctions”.
The agreements on sanctions are as follows:
- No new “nuclear-related” UN Security Council or EU sanctions. The same goes for US sanctions “acting consistent with the respective roles of the President and the Congress”.
- The “suspension” of EU and US sanctions on Iran’s petrochemical exports and gold and precious metals, and on “associated” insurance, transportation and financial services”.
- The “suspension” of US sanctions on Iran’s auto industry and on “associated services”. The White House press release states that the suspension of US sanctions on gold and precious metals, Iran’s auto sector and Iran’s petrochemical exports will “potentially” provide Iran with “approximately $1.5 in revenue”.
- The “suspension” of EU and US sanctions on insurance and transportation services associated with Iran’s crude oil sales, to enable “Iran’s current customers to purchase their current average amounts of crude oil” and to enable “the repatriation of an agreed amount of revenue held abroad”. The White House describes this as permitting purchases of Iranian oil “to remain at their currently significantly reduced levels”, and states that “$4.2 billion from these sales will be allowed to be transferred in instalments if, and as, Iran fulfils its commitments”.
- Licenses for the supply and installation in Iran of spare parts for safety of flights for Iranian civil aviation and associated services.
- An increase on the EU “authorisation thresholds” for transactions for “non-sanctioned trade” to an agreed amount.
- The establishment of a “financial channel to facilitate humanitarian trade for Iran’s domestic needs using Iranian oil revenues held abroad”. Humanitarian trade is defined as “transactions involving food and agricultural products, medicine, medical devices, and medical services incurred abroad” involving specified foreign banks and non-designated Iranian banks. This channel could also enable “transactions required to pay Iran’s UN obligations” and “direct tuition payments to universities and colleges for Iranian students studying abroad, up to an agreed amount for the six month period”. The White House states that “humanitarian transactions have been explicitly exempted from sanctions by Congress so this channel will not provide Iran access to any new sources of funds”.
The White House press release includes a section entitled “putting limited relief in perspective”, which states that “we expect the balance of Iran’s money in restricted accounts will actually increase, not decrease, under the terms of this deal”. “The vast majority of Iran’s approximately $100 billion in foreign exchange holdings are inaccessible or restricted by sanctions. In the next six months Iran’s crude oil sales cannot increase”. During the first phase, “we will continue to vigorously enforce our sanctions against Iran, including by taking action against those who seek to evade or circumvent our sanctions”.