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What To Expect If U.S. Designates Iran's Revolutionary Guards As Terrorists

FILE: Qassem Soleimani, a top military commander in Iran's powerful Islamic Revolutionary Guards Corps (IRGC).
FILE: Qassem Soleimani, a top military commander in Iran's powerful Islamic Revolutionary Guards Corps (IRGC).

Amid expectations that U.S. President Donald Trump will decertify Iran's compliance with the long-negotiated and highly contentious 2015 nuclear agreement, there are indications that Washington could up the ante by taking steps to classify one of Tehran's most powerful institutions as a terrorist organization.

A move by the White House to direct the State Department to consider placing the Islamic Revolutionary Guards Corps (IRGC) on its Foreign Terrorist Organizations (FTOs) list could mark a significant strengthening of measures already in place against the IRGC, a powerful security and military organization that is a key component of Tehran's efforts to exert regional influence.

Reuters reported in February that the proposal could come in the form of an executive order, and has been described by the Financial Times as part of a "new hard-line strategy" by the Trump administration against the Islamic republic.

Why The IRGC?

The IRGC was created after the 1979 revolution to protect Iran's Islamic establishment against internal and external threats and preserve revolutionary ideals. Under the rule of Supreme Leader Ayatollah Ali Khamenei, to whom to IRGC answers directly, its influence has increased.

Domestically, its forces have been involving in enforcing Islamic codes and crushing dissent, and the corps' intelligence branch is alleged to be behind the arrest of several Iranian-Americans.

But it is the IRGC's foreign activities that could land it on the U.S. list of FTOs. As the Trump administration has criticized Iran for failing to live up to the "spirit" of the nuclear deal worked out with world powers, under which Iran agreed to scale back its contentious nuclear activities in exchange for sanctions relief, the IRGC's involvement in covert operations, arms smuggling, and other efforts aimed at expanding Iran's influence abroad has come under more scrutiny.

The IRGC's officially unrecognized involvement in fighting in Syria in support of President Bashar al-Assad, as well as alleged operations in or involving Iraq, Afghanistan, Lebanon, and Yemen, have placed it in direct conflict with U.S. interests.

Unprecedented Move

An FTO listing, which would be subject to Congressional review, would mark the first time that a state institution had been placed on the list since its inception in 1997. To this point it has included groups such as Al-Qaeda, the extremist group Islamic State, and many others on the basis that they engage in terrorist activities and threaten U.S. interests.

The United States has already sanctioned individuals and entities affiliated with the IRGC. Qassem Soleimani, the head of IRGC's elite overseas Quds Force, is among those blacklisted by the United States.

The designation would add to those measures. But analysts express doubt that it would change IRGC's regional behavior.

Domestic Effect

An FTO designation could hurt Iran's economy by deterring financial or business dealings with entities that are part of the IRGC's vast economic empire; others would find it difficult to prove they do not have ties to the IRGC.

Behnam Ben Taleblu, a senior Iran analyst with the Foundation for Defense of Democracies, which supports the idea of blacklisting the IRGC, tells RFE/RL that it would stigmatize the entire IRGC and allow the United States to more effectively address its business interests, not just "malign political or military influence."

This, he said when reports first emerged that the White House was considering further pressure on the IRGC, "allows you to marshal this case and make a better argument down the line to say any foreign entity that does business with any IRGC entity is actually doing something wrong."

Misguided Effort?

When the reports emerged earlier this year, the lead sanctions expert for the U.S. team that negotiated with Iran under the administration of President Barack Obama told RFE/RL that an FTO designation for the IRGC would change very little in practice.

"The impact of the additional sanctions is nominal, since the IRGC is already under the most intensive U.S. sanctions possible domestically and its ability to do business abroad is compromised by U.S. sanctions still threatened against foreign banks and companies that engage with it," said Richard Nephew, who served under Obama as principal deputy coordinator for sanctions policy at the State Department. "So, this won't stop any business from taking place that isn't already complicated by sanctions."

At the time, Nephew described the idea of designating the IRGC as an FTO as "a political gesture, being advanced by hostile parties to the [nuclear deal] in the United States."

Others who spoke to RFE/RL suggested that the effect on Iran's economy that would result from an IRGC FTO designation could hurt ordinary Iranians.

"Enforcing the sanctions on the IRGC is enforcing sanctions on the Iranian economy," explains Saeid Golkar, a lecturer at Northwestern University and the author of a book on Iran's IRGC-affiliated Basij militia.

Afshon Ostovar, a senior analyst with the Washington-based nonprofit Center for Naval Analyses and author of a book on the rise of the IRGC, notes that a terrorist blacklisting for the IRGC could gradually scare off European investment and trade.

But if that were to happen, he continues, "there could be internal pressure to shrink the IRGC's purview and remove it from at least the economic and commercial sector."

Future Engagement

An FTO designation would likely increase already heightened tensions between Iran and the United States and make the prospects of improved ties highly unlikely.

Mark Fitzpatrick, the executive director of the Washington-based office of the International Institute for Strategic Studies, says that designating a branch of a government as a terrorist organization would reduce the ability to engage with that government.

"The IRGC wields great influence in Iran, so having been just declared a terrorist organization by the U.S., they would be even less inclined to want to allow [Iranian President Hassan] Rohani to engage with the United States in any issues of mutual interest, such as fighting ISIS," Fitzpatrick said earlier this year.

Rohani, who was elected to two terms in office on the promise and later the successful negotiation of the nuclear deal, said that a blacklisting of the IRGC would be a "mistake beyond mistake," claiming that the IRGC was popular in Iran and also in the region.

"The IRGC is in the heart of the people. The Revolutionary Guards, in all the days of danger, have defended our national interests," Rohani said on Twitter.

Others, notably IRGC commander Brigadier General Mohammad Ali Jafari, have responded harshly, warning that if Washington designated the IRGC as a terrorist organization, Tehran would "consider the American army to be like [the extremist group] Islamic State all around the world."

Action Aside From Words

Alireza Nader, an Iran analyst at the RAND Corporation, said earlier this year that an FTO designation could also complicate U.S. interactions with the IRGC in the Persian Gulf.

"The U.S. Navy and the Guards interact in the Persian Gulf together, so in the event of crisis how does the FTO affect the U.S. Navy's ability to engage the Iranian military?" Nader said. "Any real communication would be far more difficult."

Despite the rhetoric, however, analysts such as Ostovar believe the IRGC is not likely to take overt actions.

"Things could be done on the margins through covert activity, but any open hostility would undermine Iran's case as the victim and risk escalation with the U.S.," Ostovar said.