December 24, 2013
Jofi Joseph worked on US policy toward Iran's nuclear program at the White House. This is the second of his two reports on complications in implementing the November 24 agreement with Iran to limit its nuclear program. Read his previous report here.

As Iran and six major powers prepare to implement their November 24 deal to limit Iran's nuclear program and ease sanctions against the country, several complications could get in the way. Both sides have high stakes in making this interim deal work, majorly to let them negotiate a long-term agreement to prevent Iran's acquisition of nuclear weapons. More broadly, a resolution of the nuclear issue could encourage essential economic and social reforms that are needed to stabilize Iran and open a path to the long-term moderation of policies that have threatened peace in its region.

An initial posting December 16 on this topic noted that the two sides still must negotiate the timing and order of reciprocal steps, over a period of six months, that are intended to let Iran receive about $4.2 billion of its assets frozen funds abroad. Iran may want much of that money up front, which its interlocutors – the United States, Britain, France, Russia, China and Germany – would likely resist. (Except for Germany, these nations are the five permanent members of the UN Security Council, and so the group is known as the P5+1.)

A second complication arises in the verification of Iran's commitments to rein in its nuclear activities. Iran has promised steps to freeze its uranium enrichment capacity and restrict construction work on its Arak heavy water reactor during the six-month term of the November agreement. While the six nations negotiated this agreement with Iran, it is actually the International Atomic Energy Agency (IAEA) that will implement the transparency and monitoring measures to verify Iran's compliance. This could cause tensions; some reports indicate the six nations notified the IAEA of the specific details of the six-month plan only at the last minute, leaving the agency and its director general, Yukiya Amano, scrambling to ensure they could have the necessary resources and personnel in place.

It is unclear what would happen if any of the nations that agreed to the deal were unhappy with how IAEA interprets Iranian nuclear activity – or how conflicting interpretations would be reconciled. Finally, the IAEA secretariat traditionally has reported Iran's nuclear activities on a bimonthly basis to the agency's board of governors. It is unclear if the IAEA will now increase the frequency of such reports or establish a direct reporting channel to the P5+1, perhaps through the newly created Joint Commission, which will include representatives from both the P5+1 and Iran. These elements all will have to be blessed in a resolution passed by the IAEA Board of Governors, which can only occur after the P5+1 and Iran have successfully concluded their own technical talks.

A separate wild card in the game is the likelihood that both Iran and the P5+1 nations are likely to undertake actions that are permissible under the Geneva agreement, but that would invite charges of bad faith from the other side. Indeed, the United States did so on December 12 when it froze assets of companies it said had been evading US sanctions on Iran. Iran's government protested that step as "improper."

P5+1 negotiators consistently have emphasized to their Iranian counterparts that actions to enforce existing sanctions not addressed in the November deal will continue; and these may include punishment of entities and individuals violating those sanctions. The Obama administration likely timed its December 12 punishment of the companies to coincide with congressional testimony by senior officials on the agreement, but the actions against the companies were perfectly permissible.

We can now expect Iran to respond in kind. One of its options is to accelerate its production of what is called "twenty-percent-enriched uranium" (meaning uranium that consists of twenty percent or more of fissile isotopes, a blend that quickly can be further enriched to produce nuclear weapons). By quickly expanding its stock of twenty-percent-enriched uranium in the weeks before the six-month deal is formally implemented, Iran could prolong its retention of that material, which it has promised to dilute or convert to uranium oxide (which is used as reactor fuel). An even more provocative response would be for Iran to start running its more advanced uranium-enrichment technology (its IR-2m centrifuges), and then declare that operation a permissible "existing activity" under the interim agreement.

Of course, any such actions could be very disruptive to the good faith and mutual trust required to realize the interim deal and negotiate a long-term, comprehensive agreement. And both sides will remain under strong domestic political pressures to underscore their continued leverage. Among the P5+1, the United States especially will want to demonstrate that the overwhelming weight of the sanctions architecture continues and that, contrary to the charges of many in Congress, the interim agreement maintained vital pressures against Iran's nuclear program. In Iran, President Hassan Rouhani and Foreign Minister Javed Zarif will be eager to demonstrate that Iran has protected its rights to a civilian nuclear program, including enrichment, to refute charges by hardliners that the deal is a sellout to the West.

Although the November 24 agreement remains largely on track and is proceeding toward initial implementation sometime in January, the recent hiccups remind us that nothing will be easy about this process to restore international confidence in Iran's nuclear program. Beyond the implementation of the interim steps, the next six months will include the negotiations over the more comprehensive "end state" agreement. The P5+1 and Iran will have to wrestle over such issues as the size and scope of Iran's enrichment program over an extended period of time, the ultimate fate of facilities such as the Fordow enrichment plant and the Arak reactor, and the manner in which nuclear-related sanctions against Iran will permanently be lifted. For these reasons, Geneva likely represented only the first step in what will be a prolonged process, full of twists and turns.

Jofi Joseph worked on US policy toward Iran's nuclear program and participated in P5+1 negotiations with Iran as a Director for Nonproliferation on the White House national security staff from 2011 to 2013.