France, Germany and the United Kingdom sent a letter on August 28 to UN Security Council members announcing they are triggering the "snapback" mechanism to reimpose UN sanctions on Iran that were suspended under the 2015 nuclear deal (Joint Comprehensive Plan of Action or JCPOA), according to two European diplomats speaking with Axios.

The three European powers stated in the letter that during the next 30 days before sanctions take effect, they remain open to negotiations with Iran on a nuclear agreement that could halt the process. The snapback mechanism automatically reimposes all UN Security Council sanctions lifted under the 2015 Iran nuclear deal. The move is expected to increase economic pressure on Iran and likely lead to Iranian retaliation.

In reality, this means an asset freeze and travel bans on individuals and entities involved in Iran's nuclear and missile activities or proliferation and an arms embargo on selling Iran weapons by European firms. Further restrictions would include banking and energy sanctions on selling Iranian crude. 

Following the announcement, Iran's Deputy Foreign Minister for Legal and International Affairs Kazem Gharibabadi warned that any move to refer Iran's case to the UN Security Council would prompt Tehran's response, including halting cooperation with the International Atomic Energy Agency and removing Europe from diplomatic engagement, ISNA reported on August 28.

Gharibabadi stated that Europeans claim "with utmost audacity and insolence" to be implementing the Joint Comprehensive Plan of Action (JCPOA), while indicators show they have not only failed to implement it but have imposed new sanctions including on Iran's shipping and aviation industries.

"This issue has been clearly communicated to European parties and the European Union that if they intend to abuse the Islamic Republic of Iran's goodwill and interactions and initiate the snapback process, naturally Iran will also take necessary action," the deputy foreign minister said.

He added that if Europe sends a letter, Iran will take special measures including sending its own letter or warning to the Security Council.

Gharibabadi warned in his interview with Iranian state television IRIB that under such circumstances, the constructive engagement path opened with the IAEA would be completely affected and continuing this interactive process would no longer be meaningful.

"We have told them that if such action occurs, Europe will remove itself from the diplomatic arena and dialogues with Iran," he stated.

Iranian officials have previously threatened that triggering snapback would lead Iran to withdraw from the nuclear non-proliferation treaty (NPT), initially signed under the Shah of Iran before the 1979 revolution, which brought in the new regime of the clerics.

The European powers had given Iran until the end of August to take steps to avoid snapback sanctions, seeking Iran's return to negotiations with the United States over a nuclear deal and full UN inspector access to nuclear sites and any 60% highly enriched uranium that survived US and Israeli strikes.

A meeting in Geneva on August 27 between senior diplomats from Iran and the European powers ended without results. A source with knowledge of the meeting said the Iranians "haven't put tangible, detailed deliverables on the table" and closed the door on extending the deadline.

The fallout of the latest round of talks between the Europeans and Iranians comes after Donald Trump, in his first term as president in 2017, broke the agreement, saying he could get a better deal with Tehran and by the US initially breaking the terms of the JCPOA, the remaining signatories, including Europe, Russia and China were left to keep the deal alive with Iran.

Iranian currency markets have been under pressure with the rial falling to its lowest exchange rate for five months, prior to the release of the news about the snapback.

The rial traded above IRR1mn on August 28, according to Bonbast.com, a blacklisted black-market indicator of exchange rates. According to Bonbast, the rial traded against the dollar at 101450 by 16:00 CET on August 28.