The US Designation of the IRGC as a Terror Group: Connotations and Iran’s Reaction


On April 8, 2019, the United States designated the Iranian Revolutionary Guards (IRGC) as a foreign terrorist organization (FTO) and included it in the State Department’s terrorist organizations list. The designation aims, along with the current sanctions, to modify Iran’s behavior. Undoubtedly, this designation will have repercussions for Iran’s political system and may result in reactions as well as increase tensions between the two countries and other countries in the region.

First: US Goals
The United States has designated the IRGC as a terrorist organization because of its terrorist military and intelligence acts which have jeopardized regional security and stability. The IRGC has also been involved in the assassination of dissidents inside and outside of Iran, and it has close relations with other terrorist organizations such as ISIS and Al-Qaeda. In addition, it runs economic institutions that fund global terrorism. The designation went into effect on April 15, 2019.
The US designation is definitely a new escalation against Iran. The United States is preparing for a new phase of sanctions on Iran as the waivers granted for eight countries importing oil from Iran expires soon, in the first half of May 2019. Therefore, the US designation aligns with the gradual sanctions campaign the Trump administration has launched against Iran to change its regional behavior.
The United States certainly takes into account the importance of targeting the most active institution in the Iranian government, which plays a prominent role in supporting the regime’s confrontational strategy against the US and its strategy whether inside or outside Iran.
For the past few months, the United States has been putting further pressure on Iran through several other methods. The US Department of the Treasury intensified its pressure on Tehran by hindering Tehran’s ability to circumvent the financial sanctions imposed on it by tracking financial institutions in Turkey and the UAE that deal with the IRGC. The United States has also put several Iran-affiliated groups and militias in Iraq and Syria on its list of terrorist groups. For example, the US Department of the Treasury has put the Zainabiyoun and Fatemiyoun militias in Syria as well as the Nujaba militia in Iraq on its list of terror groups.
There is also a move to reduce Iranian oil exports by making a deal with the exempted countries to reduce their imports of Iranian oil. Some of these countries have already halted their Iranian oil imports. The United States has alerted Malaysia and Singapore (which are in close proximity to the Strait of Malacca) to monitor Iranian oil carriers passing through the Strait heading to China and to other East Asian countries. Moreover, signing an agreement with Oman will give the United States greater ability to stop the movement of Iranian naval forces in the Arabian Sea, the Indian Ocean and the Red Sea. Indeed, the designation of the IRGC as a FTO would not have been previously disregarded in such a concentrated and serious US strategy towards modifying Iranian behavior in the region.
Nevertheless, it is worth noting that the United States has designated a quasi-regular military force that is involved in military cooperation regionally and internationally. It has a range of economic institutions that monopolize Iran’s productive sectors in its economy. It also has naval forces in international waters that cause distress to US naval ships. The IRGC maintains international naval relations, carrying out naval drills with other forces. Notwithstanding that it is a cross-border military force in several areas of conflict in the region. It has tools to incite unrest and problems and an intelligence arm in every Iranian diplomatic, cultural and religious center around the world. It may seek to create security problems in some areas.
The United States has prepared itself for these confrontations by pushing the European Union (EU) countries to counter IRGC activities on their territories and by alerting its allies in East Asia to exert more significant efforts to monitor the shipments of Iranian oil along with redeploying its land and naval forces in the region. Moreover, the United States seeks to reduce the deployment of its forces in the areas surrounding Iran, especially in countries such as Syria and Afghanistan where its troop numbers are low and it seeks to redeploy its strategic naval vessels such as its aircraft carriers and nuclear submarines near Iranian territory on the Omani coast, however not in the range of IRGC missile boats in the Arabian Gulf.

Second: Implications of the IRGC Designation as a FTO
The United States has dealt with the IRGC as a terrorist organization even before this designation. The United States has imposed sanctions on dozens of individuals, entities, and firms that have cooperated with the IRGC in recent years. The IRGC’s Quds Force, one of the IRGC-affiliated elite forces tasked to operate military operations abroad, has been designated as a terrorist group since 2007.
However, this does not preclude the fact that the US decision to designate the IRGC as a terrorist organization is the most decisive measure against one of the leading institutions in the Iranian political system. The United States has never designated a military force of a foreign state as a terrorist organization, and this is a further clue that the United States aims to place further pressure on Iran to adjust its policies through strong measures and a possible confrontation if necessary. Thus, this decision is considered as a justification for future US measures against Iran.
Such a decision will impose restrictions and sanctions on the IRGC’s policies and leaders, and further sanctions will be imposed on any individual or entity cooperating with it, as well as the freezing of funds, properties, companies and projects affiliated with the IRGC. Needless to say, the IRGC plays an integral political, economic and security role at home and abroad. This designation will affect the work of the IRGC and create difficulties for its military and political activities.
Consequently, the US strategy will be instrumental in changing Iran’s behavior or in imposing unprecedented pressure on Tehran. This designation will affect the stature of one of the most important bodies that play a prominent role in protecting and securing the Iranian system at home and extending its project and influence abroad. The US designation will limit the IRGC’s ability to continue to circumvent US sanctions, especially those new measures targeting IRGC’s oil smuggling networks and its foreign financial transactions.
Regionally, the US designation of the IRGC as a terrorist organization will impose restrictions on the movement of its forces, advisers and elements that play an important role in some regional areas. States that cooperate with the IRGC will be subject to US sanctions especially after the listing of 67 other groups in the US list of foreign terrorist organizations, with most of them having relations with the IRGC.
This will create real dilemmas, especially in some areas where the IRGC plays a prominent role, such as in Iraq. The questions will concern the US-Iranian understanding on the positions of these forces and the consequences of dealing with the IRGC. Would this decision lead to a security void in Iraq, for example? Would it increase tensions and lead to an endless military escalation? How will the two military forces, each of which sees each other as a terrorist group, operate in areas of conflict, as in the Arabian Gulf and in some countries in the region that share mutual borders and maritime corridors?
Without a shadow of a doubt, there will be a real dilemma unless the United States and Iran adapt their policies after this designation so that the current escalation does not lead to military confrontation and escalation in any of the countries in the region?
Iran has been preparing for such actions. It has built its regional military strategy by adopting local militias and by recruiting non-Iranian Shiite elements to carry out military missions abroad, as well as by maintaining a limited presence of Quds force advisers and military personnel in regional countries. Iran has also adopted a policy of demographic change to nationalize these forces. In addition, it integrated them into the national armies of other countries, such as the Popular Mobilization Forces (PMF) in Iraq and Shiite militias in Syria.

Third: The options for the Iranian system
The first reaction of Iran towards the US designation was Foreign Minister Mohammad Javad Zarif’s proposal to the Iranian President Hassan Rouhani to include the US Central Command on its list of terrorist groups. Then, the Iranian National Security Council listed US forces on Iran’s list of terror groups. The commander of the IRGC threatened to target US forces everywhere, and President Rouhani threatened to enrich uranium again.
These Iranian measures and remarks appear to be a formality, and an attempt to save face, especially since it has been repeated with every similar US escalation and often does not turn into a realistic policy.
There is no doubt that the Iranian system is facing a real challenge, as this step indicates an unprecedented US seriousness in putting pressure on the Iranian government, but the impact of the US decision depends on how effective it is on the IRGC’s activities. Therefore, the Iranian political system may have limited options:
First Option: Propaganda Threats and Containing the Consequences of the US Decision
Iran may only condemn and wage a war of statements against the United States, as Iran has done recently when Israel struck its military positions in Syria. In this context, Iran may use the decision to unify its domestic front. This is clear from Khamenei’s remarks in which he urged the government and people to be prepared for a difficult time that the country will face. The Iranian government and the IRGC are used to the language of escalation in similar cases, and have never acted rashly by inciting a military escalation or targeting US forces in the region. This would be a declaration of war that the Iranian government cannot afford.
Second Option: A Calculated Escalation and Testing the Seriousness of the US Position
The IRGC may adopt operations starting from threats and ending with terrorist or subversive acts against the interests of the United States and its allies in the region. It may threaten to close the Strait of Hormuz, hit passing ships, target oil carriers in the Gulf or US forces in the region, or begin cyber hacking operations that could impact political, security and economic fronts.
However, these measures will be carefully handled to not provoke a military response from the United States. They are mere messages to test the Trump administration’s intention in implementing this designation on the one hand and an attempt to undermine its terms and to maintain the status quo on the other.
According to this option, Iran would not cross the US red lines because the benefits of this attempt would be quite minimal for Iran. And it might lead to the collapse of the Iranian political system entirely as a complete or partial military confrontation is settled by US forces.
Third Option: Integrate the IRGC within the Regular Army
Despite its high moral cost to Iran, it represents a real opportunity for Iran to resolve many of its problems at the international and domestic levels. It will improve Iran’s international image, save it from many current and future sanctions, as well as reduce the IRGC’s dominance over the Iranian economy. However, what makes this option unlikely is the actual IRGC hegemony on Iranian political life. Consequently, the IRGC will reject this option. The Iranian government has been feeding the public for many years with the rhetoric that the IRGC is independent and strong enough for any military confrontation, so how can this be changed overnight?

Fourth Option: Negotiations with the United States
The US designation will be a shock to the Iranian political system, and it will have repercussions on public opinion, which has long demanded the IRGC’S external role to be reduced. It may have an impact on the economic situation, which could exacerbate the internal situation and threaten stability at home. It will push the opposition at home and abroad to intensify pressure on the Iranian government. All these factors may lead the Iranian political system to seek appeasement with the US and open dialogue channels on the problems raised by Trump regarding Iran’s behavior.
But the Iranian government understands that negotiations will put it in a weak position, and may result in harsh concessions being imposed on it. The Iranian government may work on both lines: escalation on some fronts and opening dialogue on other fronts, so Iran will be able to reach a compromise without losing everything.
This option is reinforced while the policy of procrastination Iran has adopted against the Trump administration’s strategy since the reimposition of US sanctions is starting to collapse. The Trump administration appears to be on the verge of further tightening sanctions, particularly with regard to Iran’s oil sector and its financial transactions with the world. Moreover, the Europeans have used the element of time to put pressure on Iran and by delaying the implementation of their promises so that the European position appears deliberately or unintentionally in favor of the Trump administration.
It is likely that the Iranian political system will contain the US escalation and it will test once again Tehran’s ability to gain more time, as well as the rigidity of the US position and the insistence of the Trump administration to impose its terms on Iran. However, at the same time, it will partially respond to every case of US escalation against it – politically, militarily or economically – so that the United States feels that the continued escalation will not be cost-free. It is also expected that US forces in the Arabian Gulf will not deal with the IRGC units deployed nearby as units of a terrorist organization. The US escalation will start at the economic level to complement the US sanctions on Iran. The US designation of the IRGC as a FTO also needs further clarification, particularly the sanctions targeting Iranian leaders affiliated with the IRGC who occupy diplomatic and governmental positions; will they be treated as terrorists as well? Will the countries cooperating militarily with the IRGC be declared as countries cooperating with a terrorist organization? Although the US decision itself is a significant step in countering the terrorist acts of the IRGC, its following operational steps will determine its importance in undermining the IRGC’s terrorist activities. The IRGC will undoubtedly be under intense pressure from now on and will lose much of its ability to move outside Iran.

The Institute Management