Iran has been caught breaking its obligations under the NPT, and is now being investigated by the IAEA and the Security Council. France, Germany, and the United Kingdom, on behalf of the EU, have taken the lead in trying to reverse Iran’s threatening course. If Iran gets away with acquiring nuclear weapons in these circumstances, it would make a mockery of the nonproliferation regime. The Middle East would become even more dangerous. In short, Iran may be the proliferation tipping point.

Iran’s unacceptably narrow interpretation of its October 2003 agreement with France, Germany, and the United Kingdom to suspend fuel cycle activities, and its continued obfuscation of the nature of its nuclear activities, indicate that the Iranian leadership wants to keep Tehran’s nuclear weapon option open, even as Iran seeks to avoid becoming an international pariah. The United States, Europe, and Russia should devise a combination of costs and incentives to convince Iran’s leaders to make a strategic choice not to acquire nuclear weapons.

DEFINE SUSPENSION AND CESSATION OF FUEL CYCLE ACTIVITIES

Iran’s clear violations of its safeguards obligations and its continuing deceptions suggest that in the future Tehran must not be permitted the means to produce weapon-usable uranium or plutonium. Otherwise, such assets would give Iran the ability to leave the NPT and deploy nuclear weapons, a risk indicated by Tehran’s track record. First, the leaders of France, Germany, and the United Kingdom should precisely define what Iran should do to suspend and shut down fuel cycle activities and dismantle its facilities. In 2003, the three EU states tasked the IAEA with the responsibility to negotiate the exact terms of suspension, but this process is not working. The three EU states should reclaim the initiative. Suspension should include uranium enrichment and the fabrication and operation of centrifuge assemblies, procurement of enrichment-related technology, operation of uranium conversion facilities, and construction of capabilities related to plutonium production and separation. These demands would represent a new, restrictive interpretation of the Article IV entitlements of NPT non–nuclear weapon. But Iran’s long pattern of noncompliance and deception warrants this action, as Iran has raised serious doubts about its compliance with Articles II and III of the treaty.

CLARIFY BENEFITS

The EU, backed by the United States and other states represented on the IAEA Board of Governors, should clarify the benefits Iran would gain in exchange for forswearing acquisition and operation of all fuel production capabilities. In particular, Iran should be guaranteed a commercially viable supply of LEU for its nuclear reactors and for the removal and disposal of spent fuel. Russia and Iran already have negotiated such arrangements, and the United States should endorse them under the terms outlined above.

Developing such a plan would have several benefits. First, it would undercut the economic and energy security argument used by Iran to justify acquiring these weapon production capabilities. If Iran rejected a viable plan along these lines, it would then lay bare its underlying ambitions to acquire nuclear weapon capabilities, allowing the international community to pursue alternative enforcement measures.

Iran should also receive increased favorable access to exports and imports to and from the EU. The EU has suspended negotiations on the EU-Iran Trade and Cooperation Agreement, in protest of Iran’s violation of its nonproliferation obligations, its support of terrorist organizations, and human rights violations. The EU should specify what benefits Iran would receive if Tehran met at least the EU’s nuclear nonproliferation demands.

The United States must communicate to the current Iranian government that it will desist from regime-change efforts if Tehran verifiably forswears acquisition of all capabilities related to nuclear weapons. It is highly unlikely that either the United States or the Iranian people will be able to replace the current government before it would have time to acquire nuclear weapons. Therefore, the United States must deal with the current Iranian government, which will probably not abandon its budding nuclear weapon capabilities if it feels an existential threat from the United States.

The United States should not disavow political support for democratic reformers in Iran; rather it should do as it did with the Soviet Union: pursue nuclear negotiations while concurrently championing reform. Finally, to improve regional security, the United States should welcome and participate in a security dialogue among Persian Gulf states, including representatives of Iran and Iraq.

RAISE COSTS

The United States, France, and the United Kingdom should seek Russian and Chinese cooperation to privately warn Iran that they are prepared to vote for sanctions in the Security Council if Iran refuses to implement a complete suspension and eventual elimination of fuel cycle capabilities. These five permanent members of the Security Council (the P-5) should emphasize that they respect Iran’s desire to resist isolation, and prefer to keep the matter out of the Security Council, but that if Iran rejects a positive course the P-5 are determined to enforce compliance with the nonproliferation regime. For maximum credibility and effect, prospective sanctions should focus on international investment in Iran’s energy sector and on grants and loans from international financial institutions. Participants in the Proliferation Security Initiative should also convey privately to Iran that they will redouble their efforts to physically prevent Iran from receiving or exporting nuclear technology and material.

STRENGTHEN UNIVERSAL STANDARDS

To buttress Iran-specific initiatives, an effective nonproliferation strategy should also include:

• Clarifying through the IAEA and the NPT Review Process that all states should suspend nuclear cooperation with any state for which the IAEA cannot provide sufficient assurances regarding the peaceful nature of its nuclear program. The IAEA Board of Governors could call for a suspension when its director-general reports that a state is in "serious breach" or "noncompliance," or when an "unacceptable risk of diversion" exists or the agency cannot carry out its mission.

• Introducing a Security Council resolution to make clear that if a state withdraws from the NPT, it remains responsible for violations committed while still a party to the treaty.

• Introducing a Security Council resolution that if a state withdraws from the treaty—whether or not it has violated it—it may no longer make use of nuclear materials, facilities, equipment, or technology that it acquired from another country before its withdrawal. Such facilities, equipment, and nuclear material should be returned to the supplying state, frozen or dismantled under international verification. (A state’s failure to comply with these obligations would strengthen the legitimacy of military action to dismantle the relevant facilities and equipment.)

• Negotiating bilateral nuclear technology transfer agreements, particularly involving the Nuclear Suppliers Group, so that if a state withdraws from the NPT, it cannot use or transfer nuclear materials, facilities, equipment, or technologies.

• Establishing through relevant international bodies, as discussed earlier in this document, a general rule that no new uranium enrichment and plutonium separation facilities should be established on a national basis in non–nuclear weapon states. This rule must be established and applied immediately in Iran, but it should become a universal standard.

• Finally, the United States, the EU, and others must not ignore Iran’s location in a volatile region, where one of its adversaries, Israel, absolve Iran of its obligation to reassure its neighbors and the world that it will not seek nuclear weapons, but it makes it incumbent upon the P-5 to intensify efforts to create a zone free of WMD in the Middle East, as discussed in the next section.

Excerpted from Universal Compliance: A Strategy for Nuclear Security (Carnegie Endowment, June 2004).  We are preparing the final draft for publication in January 2005.  If you have corrections or additions to this analysis, please send your comments to npp@ceip.org