Experts warn against move to drop Iran's Revolutionary Guards from terror list to seal nuclear deal

IRGC's status as designated foreign terrorist organization remains sticking point in talks to revive Iran nuclear deal.
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Esmail Qaani and Hossein Salami
Leader of IRGC Quds Force Gen. Esmail Qaani (C), Commander of IRGC Hossein Salami (R) attend memorial for Qasem Soleimani.
(Iranian Supreme Leader press office/handout/Anadolu Agency via Getty)

With the Biden administration considering lifting the terrorist designation of Iran's Islamic Revolutionary Guard Corps (IRGC) in order to close a new nuclear deal with Iran, experts are warning such a move would empower the Iranian regime and have devastating effects on the U.S. and its allies.

The administration is considering removing the IRGC, an Iranian military force, from the State Department's Foreign Terrorist Organization (FTO) list, according to reports. In return, Iran would commit to de-escalate its aggression across the Middle East and not target Americans.

This is a "bad idea," according to Matthew Levitt, a fellow at the Washington Institute who previously served in various counterterrorism roles in the U.S. government.

The Iranian regime is pushing for the IRGC delisting so it has something to point to "when attempting to persuade investors that it is not really involved in terrorism and that such charges are just Western propaganda," wrote Levitt.

The State Department and U.S. intelligence community have for years labeled Iran the world's "foremost state sponsor of terrorism." In 2019, the Trump administration designated the IRGC as a foreign terrorist organization, saying it "actively participates in, finances, and promotes terrorism as a tool of statecraft."

The issue of whether to delist the IRGC is a final obstacle in striking a deal to place temporary curbs on Iran's nuclear program in exchange for removing billions of dollars' worth of sanctions on Iran. Most aspects of the accord have already been agreed upon, according to U.S. officials.

However, ongoing negotiations in Vienna to reach an agreement could break down if the U.S. and Iran can't reach a compromise on the IRGC designation, the Wall Street Journal reported.

"Washington should only provide relief from terrorism-related penalties in response to changes in Iran's support for terrorism, not as a side benefit of a nuclear deal," argued Levitt. "This means the IRGC should not be removed from the FTO list until there is evidence it has ceased terrorist activities — a threshold not nearly met by vague promises of 'de-escalation.'"

Other experts agreed removing the IRGC's terrorist designation in return for an Iranian commitment that precedes any verifiable change in behavior — as the Biden administration is considering — is a mistake.

"The delisting of Iran's IRGC as an FTO should only come after it makes radical and tangible changes in its regional and terrorist posture — which most know it won't as it's Tehran's crown jewel," said Jason Brodsky, policy director of United Against Nuclear Iran (UANI). "That's why most will see right through empty public commitments."

Others argue the fact that the terrorist designation and associated sanctions haven't changed Iran's behavior shows why the IRGC should be delisted.

"U.S. insistence on holding on to a superfluous sanctions that has failed to make any difference in the IRGC's behavior is as absurd as Iran's insistence on lifting a designation that would do nothing to make the IRGC less radioactive for multinational firms," Ali Vaez, Iran project director for the International Crisis Group, told the Journal.

David Daoud, an analyst at UANI and nonresident fellow at the Atlantic Council, countered one could use that same argument about any terrorist group.

"The logic behind calling for lifting the FTO designation/sanctions on the IRGC — that it hasn't impacted their behavior — applies equally to virtually every terror group, including the likes of Hezbollah, al Qaeda, etc.," he tweeted. "Should we also remove sanctions on them?"

Supporters of keeping the IRGC on the FTO list note the Houthi rebels in Yemen, who are armed and funded by the IRGC, continued launching terrorist attacks after the Biden administration delisted them last year. On Sunday, the Houthis fired missiles and drones at Saudi energy and water desalination facilities.

Through its elite Quds Force, the IRGC provides money, weapons, and training to several militias and proxies across the Middle East beyond the Houthis — many of which are U.S.-designated terrorist groups. Among these are Hezbollah in Lebanon, various groups in Iraq, and Hamas and Palestinian Islamic Jihad in Gaza.

"If the U.S. is prepared to list Iran's satellites as foreign terrorist organizations — e.g., Hezbollah — why should the mothership, the IRGC, from which manpower, money, and materiel flows be delisted?" asked Brodsky. "It makes no sense, sets a bad precedent, and is incoherent."

Inside Iran, the IRGC wields significant political clout and is deeply entrenched in all aspects of the Iranian economy, putting it in a prime position to benefit if a nuclear deal is finalized and sanctions are lifted. Experts believe much of the cash windfall received by Iran will go to the IRGC and the terrorist groups it supports.

"America's partners and allies in the region, especially the Gulf states and Israel, are extremely concerned that a renewed nuclear deal will empower Iran at a time when the United States is perceived to be stepping back from the region," wrote Levitt. "In particular, they fear that if Tehran is flush with funds from sanctions relief, it will increase its support for terrorist proxies across the region, causing further destabilization.

"At a time when senior IRGC officers are serving in Iranian embassies around the Middle East and the hardline government of President Ebrahim Raisi is in office, the Revolutionary Guards will likely grow even more powerful. In the view of U.S. allies, now is therefore the worst moment to take pressure off the organization by delisting it."

Israeli Prime Minister Naftali Bennett on Monday expressed his concerns about the Biden administration possibly removing the IRGC from the FTO.

"We are very concerned about the United States' intention to give in to Iran's outrageous demand and remove the IRGC from the list of terrorist organizations," he said at a Cabinet meeting. "Unfortunately, there is still determination to sign the nuclear deal with Iran at almost any cost — including saying that the world's largest terrorist organization is not a terrorist organization. This is too high a price."

The State Department didn't comment on the IRGC delisting issue when asked but recently told Just the News that returning to the nuclear deal is the best way not only to contain Iran's nuclear program but also to address its malign non-nuclear activities.

"A mutual return to compliance is in America's national interest," a spokesperson said. "It is the best available option to restrict Iran's nuclear program and provide a platform to address Iran's destabilizing conduct."

On Monday, State Department spokesperson Ned Price said a nuclear deal "is neither imminent nor certain," adding the administration is "preparing equally for scenarios with and without a mutual return to full implementation" of the nuclear deal.

However, Price indicated the administration is ready and willing to make concessions to nail down a deal with Tehran.

"We are prepared to make difficult decisions to return Iran's nuclear program to its JCPOA limits," using the acronym of the official name of the nuclear deal, the Joint Comprehensive Plan of Action.

Iranian Foreign Minister Hossein Amir-Abdollahian said Monday a deal is within reach but not done.

"We're close to the final phase of a nuclear deal," he said. "To resolve the few remaining issues, which are very important, we have offered certain initiatives to the U.S. through the [European Union] coordinator."

Throughout the talks in Vienna, the U.S. and Iran have been negotiating indirectly through mediators from other countries.

By all accounts, one of the remaining "very important" issues raised by Amir-Abdollahian is the IRGC delisting — much to the chagrin of analysts.

"Iran has made clear that the nuclear negotiations must remain focused on its nuclear activities alone, not its involvement in terrorism, missile proliferation, human rights abuses, illicit financing, and other malign activities in the region," said Levitt. "So long as that remains the case, the United States should not agree to provide relief from any terrorism-related sanctions."

"If Iran wants to open the file on its terrorism designations, then the negotiations should be expanded to include its regional activities in support of terrorists," he continued. "Otherwise, dropping the FTO designation prematurely could undermine the efficacy of other non-nuclear sanctions."

The IRGC will remain sanctioned by the Treasury Department even if it's removed from the FTO list.

A nuclear deal with Iran was finalized in 2015 and implemented in 2016. Former President Trump withdrew the U.S. from that agreement in 2019, and President Biden has made reviving it a top priority. However, the new accord being negotiated in Vienna contains additional measures beyond simply returning to compliance with the original version — potentially including the removal of the IRGC's terrorist designation.