A session of the International Atomic Energy Agency's board of governors was set for Wednesday to approve the draft, which papers over the dispute between the United States and France, Germany and Britain.
The United States says Iran wants to develop nuclear arms. It had wanted a direct reference to Security Council action — with an implicit threat of sanctions — should Iran fail to come clean on past nuclear secrets and renege on pledges to open present activities to full and pervasive IAEA inspection.
But the three West European nations were opposed, fearing Iran could backtrack on its commitment to clear up questions about its past and cooperate in the future if too strongly pressured.
That led to deadlock that forced the board meeting into unprecedented three-day adjournment on Friday — and on Monday led the U.S. administration to settle for an indirect reference to the Security Council in the draft.
In comments to The Associated Press ahead of Wednesday's meeting, chief Iranian delegate Ali Akbar Salehi credited the "understanding of the Europeans and the majority of the board members" for a compromise he said all could live with.
An American official told the AP that Washington "is happy" with the draft.
He noted it contained strong language on "Iran's past failures and breaches" of its safeguard agreement with the IAEA — and that such violations can lead to Security Council involvement. And the official, who demanded anonymity, asserted that a compromise "trigger clause" threatens Iran with the Security Council at least implicitly in case of new violations.
A senior Western diplomat said the Americans were united with the Europeans on the need to police Iran's nuclear aims.
"There was never any disagreement on the end state we're seeking" — an Iran free of nuclear weapons, he said.
But other diplomats said that the United States gave up more than it wanted. It had to, they said, considering Washington had the outright support of only Canada, Australia, Japan and New Zealand on the 35-nation board.
"They didn't want to go that far," said a senior diplomat of the U.S. concession on dropping demands for a direct reference to the Security Council. "But they realized that the Europeans had the stronger cards."
With delegations initially far apart, Secretary of State Colin Powell talked over the weekend and into Monday with his French, German and British counterparts to forge the compromise text.
That draft, made available to the AP ahead of Wednesday's session, refers to the IAEA statute and Iran's safeguard agreement with the agency. Contravention of either the statute and of the safeguard agreement — which is part of the Nuclear Nonproliferation Treaty — can trigger Security Council involvement.
The text warns against "further serious Iranian failures," saying that could lead the board to consider actions allowed by the statute or triggered by violations of safeguards — shorthand for Security Council action.
While welcoming Iran's "offer of active cooperation and openness" — including suspending uranium enrichment and agreeing to thorough inspections on IAEA demand — the draft calls for a "particularly robust verification system" to test Tehran's honesty.
Last week, Washington had insisted it would hold out for at least a direct threat of Security Council action over 18 years of clandestine activities by Iran including uranium enrichment and plutonium processing.
"Iran's failure to comply … with the International Atomic Energy Agency requirements is a fact," State Department spokesman Richard Boucher said Monday.
Iran insists its nuclear activities are only meant to generate power.
The United States faced similar resistance at the IAEA when it pressed to refer the North Korea nuclear dispute to the Security Council. Pyongyang had warned it would treat the imposition of sanctions as an act of war.
The Nuclear Nonproliferation Treaty requires every signatory to adopt safeguards to prevent "diversion of nuclear energy from peaceful uses to nuclear weapons or other nuclear explosive devices."