IRAN: EU DESIGNATIONS AFFECTED BY U.S. POLICY

C O N F I D E N T I A L SECTION 01 OF 02 BRUSSELS 000174

NOFORN
SIPDIS

STATE FOR P, ISN, EUR/ERA, EEB, AND NEA/IRAN

E.O. 12958: DECL: 02/06/2019
TAGS: PREL KNNC ETTC ETRD EFIN IR EUN
SUBJECT: IRAN: EU DESIGNATIONS AFFECTED BY U.S. POLICY
REVIEW?

Classified By: Chris Davis, USEU Polmincouns for reasons 1.5(d) and (e)


1. (C/NF) SUMMARY: In light of German and Italian
interventions over the past twenty-four hours, the Czech EU
Presidency has decided to postpone an EU-level experts
meeting on new Iran proliferation-related designations that
was scheduled for February 11. The Italian delegation
requested that the Council consider additional Iranian
entities and individuals (in addition to the pending French,
German, and UK lists). The Czechs told USEU that Germany had
requested the postponement of the meeting pending the Italian
request. However, the German delegation has sought to
portray itself as merely reflecting the "prevailing mood" of
the Council in favor of postponement. The German Permrep in
Brussels has expressed doubts that an EU consensus in support
of new designations is possible during the U.S. policy review
and in the absence of a "clear U.S. signal to all 27 member
states" in support of new designations. In the meantime, the
Czech Presidency confirmed its invitation to the USG to have
a Treasury-State/ISN delegation brief the Council's Middle
East experts group on February 11 on the impact of financial
sanctions on Iran. END SUMMARY


2. (C/NF) According to Czech Presidency and Council
Secretariat contacts (protect),on February 5, Germany
demarched the Czech Presidency to request postponement of a
Council working group on non-proliferation (CONOP) and
regional experts (COMEM) February 11. This joint
capital-based experts working group was to have considered
new designations of Iranian individuals and entities under
the EU,s Common Position and relevant UNSCRs on Iranian
proliferation. On February 5, Italy also surprised the Czech
Presidency by presenting it with a list of additional names
for consideration in the designation exercise. According to
EU work procedures, EU member states normally require 14 days
to review names for designation before meeting at the EU
level to discuss them. According to a Czech contact, Germany
asserted it was necessary to postpone the meeting in order to
give the new U.S. Administration time to complete its current
policy review on Iran. Germany referred specifically to a
"4-6 weeks" break for the U.S. to complete its policy
reflection exercise. (Note: Department may recall that this
appears to be the second effort by Berlin to delay EU action
on new designations in two months. The French Presidency had
held an inconclusive first CONOP-COMEM meeting on the German,
French and UK list in December, 2008. The Czech Presidency
had originally planned to hold a second round of expert talks
on January 28, but Germany had asked for a postponement until
mid-February. End Note.)


3. (C/NF) Separately on February 6, a German Permrep contact
first confirmed with us, but later denied, that Germany was
the "demandeur" for a postponement. In any case Germany felt
that a postponement was necessary given the "mood" prevailing
in some member states" that the EU should not move forward on
designations pending a "clear U.S. signal to all 27 EU member
states." Counselor Wolfgang Rudischhauser (strictly protect)
highlighted both political and procedural reasons for
Berlin's "support" for postponement. He argued that a
designation meeting now might be counterproductive because it
could "interfere with or contradict" the current U.S. policy
reflection on Iran. Referring to a German MFA memcon of the
February 4 P5 1 meeting in Wiesbaden, Rudischhauser said that
in the meeting German Political Director had underscored
"considerable problems" EU member states faced on
designations, that a signal from the U.S. would be required,
but that the US Delegation had indicated such a signal would
not be possible at this time. Absent such a signal, Germany
was concerned that the designation exercise wuld produce a
"bad outcome," i.e., no consensus among member states.
Rudischhauser expressed uncertainty about Berlin's timeline
for (eventual) EU action, but noted that his recommendation
to Berlin would be one month. As for the procedural reason
for his delegation,s delaying tactics, our German contact
noted that Italy had circulated additional names for
designation on February 5. Under EU rules, the member states
are permitted 14 days to review candidates for designations
before convening to make recommendations on those names. The
Italian names could, therefore, not be discussed by the
experts group until February 19 at the earliest.


4. (C/NF) Poloff cautioned Rudischhauser that the U.S. policy
review should not be used by EU partners as a pretext for EU
inaction and noted that our understanding of the Wiesbaden
discussion on designations was different. In internal EU
sanctions deliberations, we expected EU-3 members to make
clear U.S. support for additional EU designations.
Furthermore, Poloff pointed out that U.S. public signals

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tracked these view. For example, the State Department
spokesperson had publicly reaffirmed the U.S. commitment to
the dual-track approach and our concern that UN obligations
under the relevant UNSCRs must be fulfilled by Iran (and all
UN member states).


5. (C) Although the Czechs have decided to postpone the
joint COMEM-CONOP meeting, the Middle East experts (COMEM)
will meet in the morning of February 11. The Czech
Presidency COMEM chair confirmed its invitation for the USG
to have a Treasury-State/ISN delegation brief this regional
experts group at a lunch the same day on the impact of
financial sanctions on Iran.
MURRAY
.