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Iran Nuclear Deal

Volume 791: debated on Wednesday 9 May 2018


My Lords, with the leave of the House, I shall now repeat a Statement made today by my right honourable friend the Foreign Secretary in the other place. The Statement is as follows:

“With permission, I will make a Statement on the future of the Iran nuclear agreement, officially known as the joint comprehensive plan of action. The Government regret the decision of the United States Administration to withdraw from the deal and re-impose American sanctions on Iran. We did our utmost to prevent that outcome: from the moment that President Trump’s Administration took office, we made the case for keeping the JCPOA at every level. Last Sunday, I travelled to Washington and repeated this country’s support for the nuclear agreement in meetings with Secretary of State Pompeo, Vice-President Pence, national security adviser Bolton and others, and my right honourable friend the Prime Minister spoke to President Trump last Saturday.

The US decision makes no difference to the British assessment that the constraints imposed on Iran’s nuclear ambitions by the JCPOA remain vital for our national security and the stability of the Middle East. Under the agreement, Iran has relinquished 95% of its low-enriched uranium, placed two-thirds of its centrifuges in storage, removed the core of its heavy water reactor—thus closing off the plutonium route to a bomb—and allowed the International Atomic Energy Agency to mount the most intrusive and rigorous inspection regime ever devised, an obligation on Iran that lasts until 2040. The House should not underestimate the impact of these measures. The interval needed for Iran to make enough weapons-grade uranium for one nuclear bomb is known as the breakout time. Under the deal, Iran’s breakout time has trebled or even quadrupled from a few months to at least a year, and the plutonium pathway to a weapon has been blocked completely.

For as long as Iran abides by the agreement—the IAEA has publicly reported its compliance nine times so far—Britain will remain a party to the JCPOA. I remind the House that the JCPOA is an international agreement, painstakingly negotiated over 13 years—under both Republican and Democratic Administrations—and enshrined in UN Resolution 2231. Britain has no intention of walking away; instead, we will co-operate with the other parties in order to ensure that while Iran continues to restrict its nuclear programme, its people will benefit from sanctions relief in accordance with the central bargain of the deal. I cannot yet go into detail on the steps we propose to take, but I hope to make them available as soon as possible, and I spoke yesterday to my French and German counterparts.

In his statement on 12 January, President Trump highlighted important limitations of the JCPOA, including the fact that some constraints on Iran’s nuclear capacity expire in 2025. Britain worked alongside France and Germany to find a way forward that would have addressed the President’s concerns and allowed the US to stay in the JCPOA, but without reopening the terms of the agreement. I still believe that that would have been the better course, and now that our efforts on this side of the Atlantic have not succeeded, it falls to the US Administration to spell out their view of the way ahead. In the meantime, I urge the US to avoid taking any action that would hinder other parties from continuing to make the agreement work in the interests of our collective national security. I urge Iran to respond to the US decision with restraint and to continue to observe its commitments under the JCPOA.

We have always been at one with the United States in our profound concern over Iran’s missile tests and Iran’s disruptive role in the Middle East, particularly in Yemen and Syria. The UK has acted to counter Iran’s destabilising behaviour in the region, and we will continue to do so. We remain adamant that a nuclear-armed Iran would never be acceptable to the United Kingdom; indeed, Iran’s obligation not to “seek, develop or acquire” nuclear weapons appears—without any time limit—on the first page of the preamble to the JCPOA.

Yesterday President Trump promised to work,

“with our allies to find a real, comprehensive, and lasting solution to the Iranian nuclear threat”.

I have no difficulty whatever with that goal; the question is how the US proposes to achieve it. Now that the Trump Administration have left the JCPOA, the responsibility falls on them to describe how they, in Washington, will build a new negotiated solution to our shared concerns—a settlement that must necessarily include Iran, China and Russia as well as countries in the region. Britain stands ready to support that task, but in the meantime, we will strive to preserve the gains made by the JCPOA. I commend this Statement to the House”.

My Lords, that concludes the Statement.

My Lords, I thank the Minister for repeating that Statement. Of course, as every independent inspection has confirmed, the nuclear deal is working; Iran is complying in full, so to suggest otherwise is simply false. On the back of the success of this deal we also have a platform to make real progress on the issues the Minister referred to: in particular Iran’s ballistic missile programme, its regional activities and its human rights record. In the other place Boris Johnson said that the US has decided that there is another way forward. I welcome the Minister’s commitment to get from the US exactly what that way forward is and what it means for international peace and security. The Minister also referred to the fact that there are signatories to this international agreement. One of the sad things about this is that the opinions of those in Iran who shout, “Never trust the West” will be reinforced by this decision.

Alistair Burt said on the “Today” programme that the UK strategy was to de-escalate and hold to the agreement, as the Minister said. However, that requires Britain, the EU, China and Russia to act in concert. Can the Minister tell us exactly how we will work in concert with them to urge Iran not to respond in kind to this confrontational act, but to work with all the signatories to the international agreement? Not least, how will we work with partners in the agreement to ensure that firms trading with Iran do not face financial penalties? We need to ensure that this agreement holds; we can only do that by working collaboratively with every signatory. I hope the Minister will be able to tell us just what the Foreign Secretary is doing to work with our EU allies, Russia and China.

My Lords, I too thank the noble Lord for repeating the Statement and welcome the fact that it is refreshingly frank and clear. On these Benches we share the widespread and huge concern over Donald Trump’s decision. We share the view that the JCPOA—to quote the Statement—remains “vital for our national security and the stability of the Middle East”. It is indeed ironic that the agreement with Iran is being jeopardised at exactly the same time as attempts are being made to de-escalate matters in North Korea. The Iran nuclear deal was hard-fought for; I pay tribute to our fellow Member of the House of Lords, the noble Baroness, Lady Ashton, for her determination in seeing this through when others thought it was not possible. I am glad this is an area in which we are in lockstep with our European partners. Will the Minister say more about how we will make sure that Germany, France and the United Kingdom speak with one voice, and that China and Russia are in lockstep as well? If we are to stop Iran from walking away, that is surely vital.

Does the Minister agree that this situation plays into the hands of the hardliners in Iran, as the noble Lord, Lord Collins, has indicated? What assessment has been made of that? Does he agree that this is an incredibly dangerous time in the Middle East, with so many countries involved in Syria as well as a series of key anniversaries coming up? Could he confirm that the Government believe Iran was indeed in full compliance with the agreement and that this is indeed the view of the International Atomic Energy Agency? Does he agree that, if the United States or Israel had any evidence to the contrary, they needed to report that to the International Atomic Energy Agency?

What action is being taken to liaise with the US Administration, who clearly include some returning hardliners as well as most who have no influence whatsoever over the President? What discussions are occurring with Iranian officials? What plans are being made to tackle Iran’s potential development of nuclear weapons should the JCPOA collapse? Is there any clarity over whether UK companies would face legal proceedings in the United States if they remain involved in Iran—and what is being done to support them? What happens if they are in consortia with American companies or American parts in their supply chain? What happens if Iranian oil is removed from the global market? How are we addressing the impact of that? Can the Minister also comment on Saudi Arabia’s role? What assessment is being made of the risk that, should Iran pull back from this deal, Saudi Arabia will wish to proceed with its own nuclear programme?

This is a crisis where, once again, we see the enormous importance of our EU partners. Does the Minister agree that it is vital that this continues?

My Lords, I thank the noble Lord, Lord Collins, and the noble Baroness, Lady Northover, for their support for the Government’s position. I assure them both that the Government remain very committed to this agreement and to working with international partners to ensure that it is sustained. As I said in repeating the Statement, it has reaped benefits, particularly by stopping the development of nuclear weapons in Iran.

I shall take some of the questions in turn. I assure both the noble Lord, Lord Collins, and the noble Baroness, Lady Northover, that we will continue to work very closely on the E3 front with our partners in Germany and France. In that regard, as I said in repeating the Statement, my right honourable friend the Foreign Secretary has spoken to their Foreign Ministers. All noble Lords will have seen that the Prime Minister, my right honourable friend Theresa May, the President of France and the Chancellor of Germany issued a joint statement immediately after the announcement. How that plays out in Iran is important. It is very easy to say that you are against the West, but the West is a broad group of nations, of which we are one. I often hear the words “Islam against the West”, but I am a Muslim of the West. Does that make me a contradiction? No, it does not. The point is that we cannot speak too generally on this matter.

We have seen unity among the E3. When President Macron and Chancellor Merkel visited the United States, they consistently raised their wish to see the US remain a part of the nuclear deal, and it is extremely regrettable that it has not done so. As I said, it now remains for the US to clarify further the requirements that it wishes to see, but the framework of the deal must remain. In that respect, the noble Baroness asked a specific question about compliance. As was pointed out in the Statement, on nine occasions, the last being in February of this year, it was reported back by the appropriate agencies that there was compliance, and that continues to be the case.

The noble Lord asked about dealings with Russia and China. Through various organisations, including the United Nations, we will continue to have conversations in this regard, but they remain equally committed to this agreement as the stability of the region depends on it.

The noble Baroness asked about dealings with Iran. I can inform the House that earlier today my right honourable friend the Foreign Secretary spoke to Foreign Minister Zarif to assure Iran of our continued commitment. I am sure many noble Lords heard President Rouhani’s statement. We often hear about the different voices in Iran but President Rouhani has underlined Iran’s commitment to stay within this deal.

The noble Lord and the noble Baroness both asked about the implications for British companies, particularly those with United States counterparts. The Office of Foreign Assets Control in the US, which looks at how sanctions regimes apply, has already issued guidance to the financial services sector and we are currently evaluating that. As an initial step, we have issued immediate guidance to UK companies about reviewing their legal position with lawyers to ensure that they are compliant. At this juncture, I can share with noble Lords that there is a deferment date of between 90 and 180 days before the sanctions that the US imposes unilaterally become applicable. However, I will endeavour to keep your Lordships’ House informed about the implications of this decision, particularly for companies that may currently be investing or looking to invest in Iran and have international obligations.

My Lords, the Minister will no doubt have had his attention drawn to the rather surprising reports in the Israeli media that in recent weeks there has been an unexpected visit by a senior member of the Saudi royal family. As far as I know, that has not happened for a long time, if ever. Are the Government concerned that a new alliance between the United States, Israel and Saudi Arabia might be planning much more aggressive actions against Iran than we have seen previously?

There is speculation about different associations. What is required in that region is a degree of taking stock of what this decision means. We call on not just Iran but all the players in that region to take heed of the need to ensure stability as a priority and to show due restraint. I have made it very clear that Iran has complied with its obligations under the treaty, but the United States has raised particular concerns about the sunset clauses. However, we remain very much committed. We have seen the results and the benefits of the treaty. For other players in the region—my noble friend mentioned several countries—it is also important to reflect on what has been achieved thus far, and the importance of remaining firm on the principles of the treaty and ensuring that we can work with Iran for continued stability in the wider region.

My Lords, we stand on the brink of a disaster in the region. There is no doubt that, prior to the JCPOA, Israel was within days of carrying out an attack on what it thought were all the nuclear facilities in Iran. It is highly likely that if this falls apart, which it could, Iran will start work on a nuclear weapon again. What happens then? I am sure Israel will not allow that, and will attack—and if it attacks, people will assume that America is part of it and that we are part of it, and goodness knows what will happen in the entire region. Have we thought through what could happen, and what actions we need to think about taking? Inevitably, in a military sense, we will be pulled into this if that happens.

I think everyone is concerned about the stability of the region. Let me assure the noble Lord that we have raised our concerns with both Iran and Israel to ensure that there is a de-escalation, and no further escalation, in this conflict—which, as the noble Lord points out, will not only destabilise the region itself but have much wider implications. Let us be clear: a regional conflict is in no one’s interests. We recognise Israel’s national security concerns, but we also implore Israel to show due restraint, and Iran, too, to show restraint in its extended influence in various conflicts in the region, notably in places such as Yemen and Syria. What is needed now is restraint across the board, and we will continue to work with all parties to ensure that that prevails. The noble Lord highlights the very challenging situation that we are currently confronting.

My Lords, will the Minister accept a view from me personally: my congratulations to the Government on the role they have played in the lead-up to this lamentable decision by the US Administration? I do not believe we should mock what happened to the representations we made. They were properly and well made, both in the press and directly. What conclusions do the Government draw about a US Administration who have treated their three closest European allies with contempt, and have not felt the need to say a single word of remorse, when taking that decision, for ignoring the expressed views of their main allies? What conclusions do the Government draw from that?

I thank the noble Lord for his comments about the efforts that the United Kingdom Government made. As I said, my right honourable friends the Prime Minister and the Foreign Secretary made both calls and, in the case of the Foreign Secretary, a visit, to Washington to ensure that the US stayed part of the Iran deal. On the noble Lord’s second point, about the way the US has conducted itself with its European allies, of course it is deeply regrettable that the case made not just by the United Kingdom but by Germany and France did not get the result that we desired. However, I stress that the US and the United Kingdom remain important and strong allies. We have said clearly to the US that, while we recognise its concerns and the issues around the sunset clauses, it is now for the US to come forward and present what it believes to be workable solutions, while stressing and ensuring that the nuclear deal on the table remains intact.

My Lords, as my noble friend the Minister says, the task now is to persuade the American Administration to work on a new replacement agreement which embraces issues such as ballistic missiles and other destabilising and sinister activities by Iran. We all understand that. When we get on that path—as I hope we do—will he encourage his colleagues to point out two things to the Americans? First, if sanctions are reintroduced on a larger scale they will be immediately undermined by the Chinese, who already supply substantial amounts to Iran. They will soon supply substantial amounts of arms as well, quite aside from the wider dangers that the noble Lord, Lord West, has pointed out. Secondly, under American law the American Government are constrained from taking early and immediate actions and measures which lead to a substantial destabilisation of oil supplies in the oil market. This would certainly happen if Iran had to cut its exports from 2.9 million barrels a day down to fewer than 1 million barrels a day, and the result in oil markets would be chaos.

I agree with my noble friend’s suggestion. It remains our position and that of our European partners, the French and the Germans, whatever proposals the United States wishes to put forward. Of course we will continue to work with the United States but, equally, it remains important that the nuclear deal stays on the table and that Iran is part and parcel of that.

On the issue of the United States and sanctions, my noble friend again makes an important point. The US has now confirmed that there will be a wind-down period before the sanctions take effect of either 90 or 180 days depending on the specific sanctions. The detail of how this will be impacted is still to be seen. My noble friend’s point on China is also well made.

The nuclear deal took a long time. It went through different iterations. It took both the Democrats and the Republicans in the United States and, as was acknowledged, the noble Baroness, Lady Ashton, and others—I put on record my thanks to them—played a sterling role in bringing it to the table. It was a difficult deal to get done. Was it perfect? No, but it worked. It was having results. That is why we and our European partners remain committed to making it work by ensuring that Iran continues to remain part of the deal. The consequences of pulling away from the deal are all there and clear to be seen.

My Lords, there are a number of deeply disturbing and worrying aspects to this matter. The most powerful country in the world has broken an international agreement, and that is deeply destabilising for everyone. The cause of moderation in Iran and the position of Rouhani personally may have been undermined, which would not be in the interests of stability either. Particularly seriously, there is now a major rift between the United States and its European allies. The Government have taken exactly the right line on this, though the decision to send Boris Johnson to Washington, a man who is generally regarded as a slightly ludicrous figure—his previous intervention in Iran was certainly disastrous—was a tactical mistake. Can the Minister tell the House how it is going to be possible to prevent British or other European companies from being, in practice, so intimidated by the threat of fines from the United States Treasury as to de facto observing the US embargo whatever the British Government’s wishes on the matter might be?

My Lords, my right honourable friend the Foreign Secretary expended a great deal of energy focusing on whatever negotiations could take place and conducting last-minute meetings with various members of the Administration over this past weekend. I pay tribute to his efforts to seek an agreement and that should be recognised by your Lordships’ House.

On sanctions, as I said earlier, we have looked at the announcement from the United States and are evaluating its implications. The noble Lord raises a valid point about the threat of sanctions and the fear of what that may mean for companies operating in Iran. That is why the initial advice we have given is for companies to take legal advice on their individual cases as to the nature of what this would mean. Whether it will have an impact on their business boils down to a commercial decision they will need to take, having evaluated the risks in front of them. We will continue to look closely at the situation and if further advice is needed it will be provided on the Foreign Office website at the appropriate time.

My Lords, I do not wish to repeat much that has already been said, but there are two matters that I would like to draw to the attention of the House. First, this was a deliberate breach of Resolution 2231 of the Security Council of the United Nations. It also occurs at the same time that the embassy of the United States is being located in east Jerusalem, contrary to international law. Will the Government impress upon our American colleagues that it is very difficult to maintain a special relationship dependent on shared values if there are serious breaches of international law that is respected, on the other hand, by the United Kingdom?

The noble Lord makes important points. The robustness and application of and adherence to UN Security Council resolutions are part of ensuring the vital international rules-based system that we all subscribe to. That is a point that we continue to make to our colleagues, our friends and our allies—that is, the United States. I think that we continue to have a very deep, meaningful and strong partnership with the United States on a raft of different issues, and we continue to wish to see direct engagement from the United States. That is important, not just for our bilateral relationship but for the security and stability of various regions in the world. Therefore we will continue to engage in a very positive vein on this issue.

In the same context, we look towards the United States, our strong ally. We will work constructively and co-operatively with it to address the wider concerns, be it on the issue of ballistic missiles or sunset clauses, ensuring that the nuclear deal stays live.

Would my noble friend assist the House in this regard? If the United States seeks to impose sanctions on UK firms trading with Iran after it has reactivated the sanctions regime, would the United States then be in breach of any international treaty, law or rule? If so, what does the United Kingdom propose to do about that?

Again, my noble friend raises an important and pertinent point. As I have already alluded to, our immediate advice to UK companies impacted as such has been to take specific legal advice on their individual cases. The full implications of how these sanctions will translate is still being evaluated. Once more detail is available we will share that with the companies, as appropriate; but I cannot stress enough that any company in the United Kingdom that feels or believes it is impacted should take legal advice now.

My Lords, I wonder whether the greatest danger here is that the approach of President Trump is completely counterproductive, in precisely encouraging the more hard-line and reactionary elements in Iran. Given that there has in fact been some good movement in the past year, with President Rouhani being re-elected against the more hard-line candidate and some changes on the legal front in the last six months, the danger is that this is going to provoke a deep anti-American, anti-western reaction that is precisely contrary to our fundamental thrust, which should be to promote the moderate elements in Iran. If so, what can we do—quite apart from the issue around the treaty—to promote the more moderate elements in Iran, which have a real traction when it comes to elections?

The right reverend Prelate raises an important element within the context of how the American withdrawal from the deal will be perceived in Iran. We have taken a very progressive, constructive and vital step forward, through the showing of strength of E3 unity. The President of France and the Chancellor of Germany, together with our Prime Minister, have issued a joint statement in that regard. As I said earlier, that translates the fact that not all the West shares the opinion of the United States in pulling away from the deal. It is important to communicate that effectively, as my right honourable friend the Foreign Secretary did today to Foreign Minister Zarif, and we continue to make that point consistently in all our dealings with Iran. On there being different voices within Iran, we saw President Rouhani step forward and give his commitment. We will continue to support all efforts to keep Iran within the deal and all international efforts to ensure that the deal itself remains alive.

My Lords, the Minister said that the agreement has worked, but has it? It might have worked for the nuclear agreement, but has it worked for sanctions? Hundreds of millions of dollars are now in the hands of the Iranian Government. It has not gone to the people at all. It has gone into causing mischief in Syria, Lebanon and Yemen. Hundreds of thousands of people have died in those countries. I would be interested in the Minister’s comments.

I share the noble Lord’s concerns. I was quite specific on which elements of the deal have worked. I also said that the deal is not the perfect deal. There are limitations on it, some of which have been highlighted by the US in stating its reasons for withdrawing from it. That said, we still believe it to be an important part of ensuring that Iran does not progress down the route of acquiring nuclear weapons.

The noble Lord alluded to Iranian influence in the wider region. Again, we strongly condemn Iran and call on it to pull back. It has shown its hand in places such as Lebanon and Yemen, with support for the Houthis, and it continues to do so in Syria. This is not helping the situation in the wider region. It is destabilising. It is important that Iran recognises that its interventions in other parts of the region are viewed as far from helpful; they are extremely destabilising to the region and to peace generally. I assure all noble Lords that we continue to make this point very strongly to the Iranian authorities, its President and Foreign Minister on all occasions that we have these discussions. Iran has been destabilising in the region. That has to be recognised.

On our continued support, everyone would regret the fact that the Iranian people themselves need support. They have embarked on a difficult journey that is far from complete. It is important that we continue to show our support for them in the hope that we will see the kind of representation we all desire in Iran itself.

My Lords, I thank the Minister for repeating the Statement. I commend the Government for standing four-square behind the JCPOA and I associate myself with the remarks of the noble Lord, Lord Hannay. But with all due respect, businesses that are conducting perfectly legal business with Iran need more than advice. The Foreign Secretary said today in the other place:

“We will do our utmost to protect UK commercial interests”.

On 24 April, in the context of a Private Notice Question asked by the noble Lord, Lord Campbell of Pittenweem, I asked a very specific question about this issue, asking what the Government intended to do in the light of developments at the Bill Foreign Ministers’ meeting to bolster and support our businesses, which were already concerned about the reimposition of US sanctions and secondary sanctions. I was not given an answer, but I was given an assurance that I would be written to. I await that letter; I am content about that. But surely the time has now come for us to tell businesses more than that they should take some legal advice and await further advice. We need to give them some specific indication of the extent to which the Government are willing to go to protect their interests from the devastating effect of these potential sanctions.

On the noble Lord’s first point, I will ensure that there is a response, although that response no doubt will reflect the decision just taken. As I said earlier, the United States itself has issued specific guidelines in this respect, which we are currently evaluating. What I said about taking immediate legal advice was just that: immediate and initial advice. We will follow this up.

Of course we remain committed. We believe in strengthening trading ties with all countries across the world, but in this case we have continued to encourage commercial ties with Iran to try to build and progress that country to a more progressive future. We will look at this very carefully. Let me assure UK companies that are impacted that we are looking at the situation closely. The advice was issued only yesterday. We want to make sure we are evaluating it fully to ensure that we can subsequently give whatever advice and level of support we can after we have fully considered the implications. This is not just about telling businesses to get legal advice, but the first step must be—and I was in business for 20 years—to talk to your lawyers to make sure what you are doing and currently trading is in the context of international law and adherence to whatever sanctions regime might prevail.

My noble friend earlier raised an important point about the implications of the United States decision for international law. That also has to be evaluated, but let me assure all noble Lords that we are looking at this very carefully. It is a very sensitive issue, but the interests of British companies are going to be protected.