The International Atomic Energy Agency (IAEA) was expected to adopt a British-French-German draft resolution which is relatively uncritical of Iran and praises the Islamic Republic for suspending uranium enrichment as a confidence-building measure.

Diplomats told AFP the IAEA had verified that Iran had suspended all uranium enrichment activities, following Tehran's agreement to add 20 disputed centrifuges to the freeze.

"The verification of the suspension has been done. They have done that," a European diplomat said.

EU negotiators Britain, France and Germany had agreed with Iran in Paris on November 7 to freeze all Iranian enrichment activities as a confidence-building measure to answer US charges that Tehran is secretly developing nuclear weapons.

The suspension started November 22, but Iran said it wanted 20 centrifuges to be exempted so that it continue nuclear research.

In intense back-door negotiations, the three European countries gave Iran a deadline to agree to a full freeze by Sunday, or face a possible move towards UN sanctions when the IAEA board resumed its meeting on Monday.

The Iranian government avoided this by sending a letter Sunday to the IAEA withdrawing its demand to exempt the 20 centrifuges from the freeze, Iranian nuclear negotiator Hossein Moussavian told AFP.

IAEA chief Mohamed ElBaradei was expected to announce the move when the agency's 35-nation board of governors meets later Monday to vote on the resolution.

A diplomat close to the IAEA said the "suspension is verified and cameras are in place monitoring the 20 centrifuges."

The resolution calls for continuing investigation into sensitive aspects of Iran's program as ElBaradei has said that while no diversion of nuclear materials for weapons purposes has been detected, he can not yet rule out that there is covert activity.

But it reflects Iran's claims that the suspension is "not legally binding," since Iran has the right to enrich uranium according to the nuclear Non-Proliferation Treaty (NPT), even though it is now voluntarily agreeing to a freeze.

Moussavina said the draft resolution "is without doubt the most positive one to be presented to the (IAEA) board of governors since the beginning of the Iranian nuclear crisis," in 2002, when secret sites were revealed.

He told Iranian state radio from Vienna "the Iranian case will disappear from the top of the agenda of the IAEA board" since "it is up to the director general of the IAEA (ElBaradei) to seize the board (only) if necessary."

Moussavian told AFP that Iran thinks the EU-negotiated nuclear agreement should open up a new era of cooperation between Tehran and Europe after a quarter-century of tensions.

"The substantial issue from now looking forward will be the comprehensive commercial, technology, security, political and even nuclear issues" the EU has promised to work out with Iran in a long-term agreement with negotiations set to start on December 15, Moussavian said.

The United States has argued that the IAEA should take Iran before the UN Security Council, which could impose sanctions, for what it says is a covert nuclear weapons program but this is unlikely now that Iran has agreed to a full suspension and accepts the European resolution, diplomats said.

US officials said Washington was ready to back the latest European proposal as long as Iran fully suspended uranium enrichment.

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