The United Nations Security Council in June approved a new round of sanctions aimed at persuading Iran to end uranium enrichment. The EU decided that those measures did not go far enough and is due to bring in more, targeting the energy, banking and transport sectors.

We have a comprehensive set of sanctions ... This is something where youll see all 27 (EU) countries working together, the EUs foreign policy chief Catherine Ashton told journalists.

Diplomats said the measures would include a ban on European sales of equipment to the Iranian oil and gas industries, operating restrictions on Iranian banks and the extension of current asset freezes and travel bans to more regime members and affiliates.

However, ministers stressed that the purpose of the sanctions was to encourage Iran to negotiate, admitting that the measures themselves would not be enough to halt the enrichment programme.

I remain to meet anyone who thinks that this issue is going to be sorted out by sanctions alone, so I think well have to look at the different ways in which we can strengthen and emphasise the diplomatic track, Swedish Foreign Minister Carl Bildt said.

Ministers also warned that the EUs sanctions regime, by going beyond UN measures, could have unwanted side-effects on EU companies.

When it comes to measures which are not implemented by the whole international community, then it allows other countries not to follow them ... Countries in the region, countries in East Asia could easily substitute European businesses in Iran, Cypriot Foreign Minister Markos Kyprianou said.