Iran and Europe’s Struggle to Preserve the JCPOA in the Shadow of U.S. Withdrawal

The Joint Comprehensive Plan of Action (JCPOA), concluded in Vienna on July 14, 2015, marked a significant milestone in international diplomacy by forging a comprehensive agreement between Iran and the P5+1 nations (China, France, Germany, Russia, the United Kingdom (UK), and the United States (US)), alongside the European Union (EU) (European External Action Service (EEAS), n.d.). The primary goal of this agreement was to ensure Iran’s nuclear program remained exclusively peaceful in exchange for substantial sanctions relief. The plan would work by rolling back Iran’s nuclear capabilities, effectively extending its “breakout time” from several months to a minimum of one year (EEAS, n.d.). Key provisions included stringent limits on uranium enrichment, reducing Iran’s low-enriched uranium stockpile to 300 kg and restricting enrichment levels to 3.67%. Operational centrifuge numbers were capped, and critical facilities such as Fordow and Arak were repurposed for civilian use under continuous monitoring from the International Atomic Energy Agency (IAEA)  (Bradner, 2015; Kerry, 2015; Peralta, 2015). The EU, led by its High Representative, played a pivotal role in these diplomatic efforts, championing the JCPOA as a successful model of multilateral engagement and a pathway to broader diplomatic relations with Iran  (EEAS, n.d.). 

The diplomatic success of the JCPOA began to unravel dramatically on May 8, 2018, when the US, under President Donald Trump, unilaterally withdrew from the agreement (IAEA Spokesperson, 2018; Wagner & Rocha, 2018). While evidence from the IAEA indicated that Iran was complying with the deal, the US cited perceived deficiencies in the agreement itself and reinstated extensive primary and secondary sanctions on Iran. This “maximum pressure” campaign effectively cut off Iran’s access to the international financial system, thereby negating the economic benefits that had been fundamental to Iran’s cooperation with the JCPOA’s conditions (Ferragamo et al., 2025). In retaliation to the US withdrawal and the lack of the anticipated economic relief, Iran began a phased reduction of its commitments to the JCPOA starting in July 2019. This included surpassing limits on its enriched uranium stockpile and progressively raising enrichment levels, initially to 4.5% and later to 60% (Arms Control Association, 2022). Furthermore, Iran reduced its cooperation with the IAEA, limiting the ability for the organization to oversee Iran’s nuclear development.  

Europe’s Inability to Save the JCPOA 

The EU consistently positioned itself as a key diplomatic actor in the Iran nuclear issue. Since 2006, the EU High Representative has led diplomatic initiatives involving the E3/EU+3 and Iran, culminating in the JCPOA. The EU’s approach has been centered on engagement and critical dialogue with Iran, driven by the dual goals of preventing Iran from acquiring nuclear weapons and reducing the risk of regional conflict (Alcaro, 2019). Even after the US backed out of the JCPOA, the EU reaffirmed its commitment to the agreement, expressing deep regret over America’s decision to re-impose sanctions (Parsi & Bassiri Tabrizi, 2020). In the immediate aftermath of the US withdrawal, Iran called on Europe to take a leading role in upholding the agreement by helping to protect Iranian oil from the reinstated US sanctions. For its part, the EU updated its Blocking Statute in order to distance itself from complying with the American sanctions (Mairson, 2019). However, this measure proved largely symbolic, as many European companies, fearing exposure to US secondary sanctions, chose to withdraw from Iran (Islamic Republic News Agency (IRNA), 2019). The dominance of the US dollar and the allure of the larger US market therefore severely hindered European attempts to maintain trade with Iran. 

Despite Europe’s stated ambitions for strategic autonomy, particularly in foreign policy and trade, the reality of its deep economic and financial integration with the US posed significant challenges in upholding the JCPOA without America.  Within some Iranian political circles, the EU’s inability to provide any meaningful alternative to the benefits of the JCPOA was perceived as a failure to uphold its commitments, with some commentators going far enough to call the EU’s inaction as an implicit approval of America’s withdrawal (Kayhan, 2019). 

Inability for INSTEX to Replace the JCPOA 

Despite being highly sensitive towards American sanctions, Europe worked to maintain the core agreements of the JCPOA through the creation of the Instrument in Support of Trade Exchanges (INSTEX). Established by the E3 (France, Germany, and the UK) on January 31, 2019, INSTEX aimed to circumvent US sanctions and facilitate legitimate trade between Europe and Iran, particularly for ‘humanitarian trade’ in medicine and food (Parsi & Bassiri Tabrizi, 2020; Zimmt, 2020). 

In response, Iran created the Special Trade and Finance Instrument (STFI) to collaborate with INSTEX. Initially, Iranian officials had high hopes for the mechanism, expecting it to address the country’s economic challenges by facilitating significant trade with Europe (Zimmt, 2020). However, these expectations weren’t met. Iranian officials, including Deputy Foreign Minister Seyed Abbas Araghchi and Central Bank Governor Abdolnaser Hemmati, expressed frustration with this new program. They acknowledged that INSTEX hadn’t delivered the promised results for humanitarian trade and failed to expand into other vital sectors, such as oil and other commodities promised under the JCPOA (Mashregh News, 2020; Student News Network (SNN), 2020). 

From a European perspective, INSTEX failed because of Iran’s refusal to comply with Financial Action Task Force (FATF) standards on anti-money laundering and terrorism financing. Without Iran’s cooperation in these areas, the INSTEX program was never implemented in full, thus leading to underwhelming economic benefits for Iran (Lopez, 2018). As an intergovernmental organization, the FATF aims to combat money laundering and terrorist financing by setting international standards and promoting their effective implementation (FATF, n.d.). Iran has been reluctant to fully ratify FATF agreements, such as the Palermo Convention and the Combating the Financing of Terrorism bill, because it fears that compliance would hinder its efforts to bypass sanctions and fund regional activities, including supporting para-military  resistance groups, some of which are designated as ‘terrorist organizations’ by Western governments (Mehr News Agency, 2024). Adhering to these standards would also make Iran more heavily reliant on the international monetary system, a system from which it has a proven history of being cut off due to unilateral decisions from the US (US Department of the Treasury, 2019).  

The situation reflected a cyclical dynamic: Europe, constrained by US pressure, offered a limited solution that Iran found inadequate for its broader needs. Iran’s subsequent non-compliance with the FATF provided Europe with a justification for the mechanism’s failure, thus entrenching the impasse. Both sides blamed each other, but the core issue remains in the US’ ability to dominate international finance and trade flows. 

Iranian Domestic Critique of Western Diplomacy 

Principlist factions within Iran have consistently portrayed European diplomatic efforts as superficial, suggesting they merely mask a deeper alignment with US interests. The longstanding metaphor of a “velvet glove” concealing an “iron fist,” is frequently invoked by Iran’s Guardian Jurist¹ to describe EU foreign policy, reflecting a deep-rooted mistrust of Western intentions (Tabnak, 2023). In a notable 2022 speech, the Guardian Jurist asserted, “the support promised by Western powers to compliant governments is illusory; it never materializes. All governments must come to understand this… Today, the world’s bullies have shed the velvet glove, revealing their iron fists” (Tabnak, 2023). This rhetoric has been widely echoed by Principlist circles, who express strong alignment with and loyalty to the country’s head of state. 

This deep-seated mistrust towards the West was a primary reason why the Principlist group opposed the JCPOA from the outset (Mehr News Agency, 2020). Viewing negotiations with the West as a form of colonial coercion, Principlist leaders argued that it was Iran’s “military and nuclear strength” that had compelled the US to engage diplomatically (Mashregh News, 2023). Principlists repeatedly cautioned against trusting European powers, accusing them of repeatedly betraying Iran throughout history. In line with this perspective, they categorically rejected any dialogue concerning Iran’s nuclear program, framing the program as an essential pillar of the country’s defensive posture. This group also vehemently opposed efforts to ratify the FATF regulations, contending that compliance would undermine Iran’s strategic flexibility and further constrain its ability to sustain a functioning economy under the weight of international sanctions (Mashregh News, 2023; Ghobadi, 2025). 

Iranian Reformist Advocacy for Engagement with Europe 

In contrast, Reformists aligned with the Rouhani administration advocated for closer cooperation with Europe as a means to isolate the US and alleviate the impact of sanctions following Washington’s withdrawal from the JCPOA. Reformist media outlets embraced what they saw as progress in nuclear negotiations, anticipating that the INSTEX agreement would yield tangible economic and diplomatic benefits. Iranian media, echoing the administration’s policy outlook, highlighted support from the European business community for the deal, reinforcing the Rouhani government’s optimism about the opportunities of the new agreement (Jamshidi, 2020). 

Transition from Rouhani’s Optimism to Raisi’s Defiance 

The internalization of America’s decision to quit the JCPOA proved pivotal in reshaping Iran’s political landscape towards cooperation with the West. Although the Rouhani administration had championed the JCPOA as a pathway to economic relief, the US withdrawal from the agreement and Europe’s subsequent failure to find an alternative significantly bolstered Principlist credibility. Seizing on widespread disillusionment with a decade-long policy of engagement with the West, Principlists portrayed diplomatic outreach and reliance on European mediation as both futile and harmful to Iran’s national interests. The collapse of the JCPOA, coupled with the failure of the INSTEX mechanism, prompted a shift toward a more assertive nuclear policy and a rejection of European mediation (IRNA, 2021). 

Propelled, in part, by the failure of the JCPOA, Iran’s 2021 presidential elections brought Principlist Seyed Ebrahim Raisi to power. Raisi adopted a more confrontational approach toward the West, making the resumption of nuclear negotiations conditional on the full lifting of sanctions and firmly excluding Iran’s ballistic missile program and regional activities from the negotiating agenda (Mehr News Agency, 2022; Tasnim News Agency, 2024). His presidency marked a clear departure from Rouhani’s cooperative stance, signaling the consolidation of Principlist influence across all branches of government. The dynamics of negotiation under Raisi’s leadership, in contrast to his predecessor, will be examined in the next article, with a focus on the evolving contours of Iran’s diplomatic strategy. 

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