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Iran Nuclear Deal (JCPOA) Takes Effect

By Mitchell Bard (January 16, 2016)

The United States and other world powers welcomed Iran back in to the global economy on January 16, 2016, lifting burdensome economic sanctions as the historic Joint Comprehensive Plan of Action (JCPOA) took effect. The IAEA, the United Nations nuclear watchdog organization, released a report on January 16 confirming that Iran had complied with all aspects of the nuclear agreement. IAEA Director General Yukiya Amano penned a statement that read, “Iran has completed the necessary preparatory steps to start the implementation of the Joint Comprehensive Plan of Action... Relations between Iran and the IAEA now enter a new phase. It is an important day for the international community. In line with its commitments, Iran will start to provisionally implement the Additional Protocol to its Safeguards Agreement with the IAEA. Together with other nuclear-related measures under the JCPOA, this increases the Agency’s ability to monitor nuclear activities in Iran and to verify that they are peaceful” (IAEA, January 16, 2016).

The United Nations Security Council received the IAEA report detailing Iran's compliance with the JCPOA on January 16, 2016, triggering an automatic end to most United Nations Sanctions on Iran under UNSCR 2231 adopted on July 20, 2015. UNSCR 2231 states that when Iran completes all of the necessary steps to implement the agreement and the IAEA approves, seven Security Council resolutions against Iran will be lifted. The resolution includes an automatic snap-back provision to re-impose sanctions, should Iran be found in violation of the JCPOA. The Iranians are encouraged not to engage in research and development of ballistic missiles capable of delivering a nuclear warhead for eight years under UNSCR 2231, but the language is vague. This resolution also includes an arms embargo preventing Iran from selling or purchasing any weapons for five years.

To reach this historic date, Iran had to comply with all aspects of the nuclear agreement including dismantling approximately 13,000 centrifuges, removing the core of the Arak nuclear reactor and filling it with cement, and shipping the vast majority of it's enriched uranium stockpile to Russia. Speaking at a press conference in Vienna, Austria, U.S. Secretary of State John Kerry pointed out that Iran's stockpile of enriched uranium was just two percent of what it was prior to the JCPOA.

Although U.S. and International economic sanctions were lifted, the U.S. embargo on Iran remained in place, preventing U.S. companies from engaging in direct business with their Iranian counterparts with a few minor exceptions. These exceptions include passenger aircraft, rugs, and pistachio nuts. In addition to the embargo, sanctions relating to Iran's human rights abuses and support for terrorism remained in place. New sanctions pertaining to Iran's recent ballistic missile tests were simultaneously put in place by the Obama administration along with the lifting of economic sanctions. These sanctions targetted eleven individuals and small companies suspected of shipping critical technologies to Iran, such as carbon-fiber and parts to various missiles. Most Iranians will not be affected by these new sanctions. Iranian officials referred to these new sanctions in the subsequent days as “illegitimate,” and “propagandastic.” Iranian Foreign Ministry Spokesman Hossein Jaberi Ansari claimed that the sanctions “have no legal or moral legitimacy” (Yahoo, January 18, 2016). Other Iranian officials asserted that they would continue to test their ballistic missiles, regardless of these new sanctions.

With the lifting of these sanctions, Iran was permitted to export as much crude oil as it could find demand for.