US sanctions bill raises tensions over Iran nuclear pact

A bill extending US sanctions against Iran for 10 years went into effect on Thursday, casting a shadow over the future of the nuclear deal reached between Tehran and world powers last year as the incoming Trump administration prepares to take office next month.

In a symbolic gesture, President Barack Obama did not sign the renewal of the Iran Sanctions Act, but let it become law under procedural rules after both houses of Congress last month overwhelmingly passed the bill extending some sanctions and making it easier to "snap back" nuclear related sanctions lifted in January if the deal is violated.

US officials have said that renewing the bill would not violate the nuclear deal signed between Iran and the P5+1 - China, Russia, the United States, France, Germany, and Britain - that dropped crippling international sanctions in exchange for Iran giving up its nuclear weapons program.

The White House said in a statement that extending the Iran Sanctions Act was unnecessary but "entirely consistent" with US commitments under the Iran nuclear accord, also known as the Joint Comprehensive Plan of Action (JCPOA).  German diplomatic sources told DW that Berlin also does not believe the Iran Sanctions Act constitutes a violation of the JCPOA, but added that "confidence building requires all parties to adhere to the agreement."

The US bill does not directly address the nuclear deal and the White House can issue waivers for sanctions to comply with the accord. Washington maintains a host of other sanctions on Iran related to human rights abuses, support for terrorism and its ballistic missile program. 

Deterence and open options

Echoing the sentiment of both sides of the aisle in Congress, Democratic US Senator Robert Menendez said the extension of the bill was meant to send a message so that "the Iranians will know of the consequences of any breach, and we will deal with missile proliferation, terrorism and regional destabilization that are just as dangerous and just as threatening to American security and to Israel."

Emily Landau, head of the Arms Control and Regional Security Program at the Institute for National Security Studies think tank in Israel, told DW that the Obama administration has "bent over backwards" to ensure the nuclear deal's success, including ignoring other issues such as Iran's ballistic missile program and its spreading influence across the Middle East.  As a result, the US has lost some of its deterrence capability.

"The overall dynamic is Iran pushing the envelope over a number of other issues," she said. "If you don't start deterring Iran, Iran will start deterring you more and more until you have no options to deter Iran's behavior."

Iran has warned that the extension of the act, first enacted in 1996 and extended several times, violates the nuclear accord and has vowed unspecified retaliation. It filed a complaint with the UN and President Hassan Rouhani on Tuesday ordered scientists to prepare plans for a "nuclear propeller to be used in marine transportation" in line with the nuclear accord. However, any substantial effort to develop such technology would likely require Iran to raise levels of uranium enrichment above that allowed under the nuclear deal and would take years to develop.

Iran has complained that it has not received the full benefits of sanction relief because of other non-nuclear related sanctions. The US's complex sanctions regime against Iran raises the cost and risk of doing business with the Islamic Republic because non-US entities doing business in the US may be subject to US laws.  As a result, some of the benefits Iran expected from the nuclear accord have not materialized, giving ammunition to factions in Iran opposed to the accord.  Others point to Iran's poor investment environment for the slow return of businesses to the country.

President Hassan Rouhani has staked much of his political capital on the nuclear deal in the face of criticism from hard-liners, with promises that the country's economic isolation would end and the West would live up to its side the agreement.

Reza Akbari, Senior Program Officer at the Institute for War and Peace Reporting, told DW that with presidential elections coming up in Iran in May 2017 and hard-liners opposed to the deal, Rouhani has had to posture for domestic politics.

"Rouhani has been getting a lot of pressure from hard-liners from the very beginning who have been critical of his administration, claiming it has given away too much to western powers and not protected national security," Akbari said. "He has to demonstrate strength and the ability to be tough when it comes to enforcing the terms of the JCPOA. He is going to have to rebuff a lot of attacks."

Trump wildcard

It remains unclear whether President-elect Donald Trump's campaign rhetoric will translate into a policy of unraveling Obama's signature foreign policy achievement. Trump has called the Iran nuclear accord "one of the worst deals I've ever seen negotiated" and vowed to renegotiate or tear it up. Many Republicans in Congress want to scrap the deal entirely.

Trump's cabinet choices, including his pick to lead the CIA, Mike Pompeo, and defense secretary nominee, retired Gen. James Mattis, are hard-line opponents of Iran.

However, none of the other parties to the deal have expressed an interest in making any changes to the nuclear accord. Since dismantling the international sanctions regime, China, Russia and Europe have all rushed to strike trade and investment deals with oil-rich Iran. Any unilateral US move to re-impose sanctions on Iran so long as Tehran abides by the deal would likely not be effective because other parties to the agreement would not follow the US's lead.

"If the US is walking the sanctions route it will be walking it alone," Akbari said. "It would be easy for Iran to win the rhetoric war among the international community… that the US broke the deal."

Unraveling the accord would also have the effect of strengthening hard-liners in Iran. Current CIA Director John Brennan warned the incoming administration in a BBC interview last month that scrapping the nuclear deal would be "disastrous." He said that such a move by the Trump administration would strengthen hard-liners in Iran.

"The biggest losers of renewed sanctions would be the Rouhani administration, which has staked political capital on the deal," Akbari said.