FACTBOX: Iran's relations with U.N. nuclear watchdog

VIENNA (Reuters) - Western leaders have accused Iran of hiding a second uranium enrichment plant from U.N. nuclear inspectors for years before admitting its existence in a letter to the International Atomic Energy Agency this week.

Iran denied concealing anything, with President Mahmoud Ahmadinejad telling a New York news conference, "It's not a secret site. If it was, why would we have informed the IAEA about it a year ahead of time?" Iranian officials said the plant was being built according to IAEA regulations.

Here are some relevant points about the dispute.

NOTIFICATION RULES

* The United States and major Western allies believe Iran violated its nuclear non-proliferation safeguards agreement with the IAEA about when it should inform the agency of a new nuclear facility or plans for one.

* Under the original IAEA statute governing member states, such a declaration was not required until six months before nuclear materials were introduced into a new atomic facility.

* But in 1992, the 35-nation IAEA Board of Governors decided this not was not sufficient time to arrange requisite inspections. They amended the rule to say notification has to be made "as soon as the decision to construct or to authorize construction has been taken, whichever is earlier."

* This amendment is known in the safeguards community as "Code 3.1." Iran and many other countries signed up to it.

* Western diplomats with access to intelligence said Iran started building the undeclared second enrichment plant in 2006. "Iran was then observing the modified Code 3.1, so (legally) it should have notified the IAEA then," one diplomat said.

* In 2007 Iran reverted to the previous arrangement -- a six-month notice period -- in protest after the IAEA governors referred its case to the U.N. Security Council in 2006, a move that led to three sets of punitive sanctions.

Since then, Iran generally has refused to provide advance design information on planned nuclear sites to the IAEA.

* The IAEA's stance is that countries cannot unilaterally go back to the old system, but rather are bound to the new one.

PREVIOUS PATTERN OF SECRECY

* Iran set up a nuclear program based on proliferation-prone uranium enrichment with the help of Pakistani-led traffickers in atom bomb know-how and concealed it for 18 years until Iranian exiles blew the whistle in 2002.

* Iran admitted the existence of a nascent enrichment facility at Natanz and submitted to regular IAEA inspections meant to verify the dual-use technology used there would be limited to refining uranium for electricity, not atom bombs.

LACK OF IAEA INVESTIGATIVE POWERS

* Under heavy pressure for nuclear transparency, Iran also voluntarily complied for awhile with the IAEA's Additional Protocol, which it had never ratified, permitting short-notice inspections ranging beyond declared nuclear sites.

* But Iran scrapped compliance with the protocol in 2006, again in reprisal over its nuclear dossier being turned over to the Security Council.

* Without search powers provided by the protocol, the IAEA has admitted that its grasp of the scope and nature of Iran's nuclear activity, including research and development of advanced enrichment centrifuges, has been steadily diminishing.

* Essentially, the IAEA cannot verify that Iran has no parallel, covert nuclear project devoted to nuclear weapons somewhere in the vast, opaque country, or run down information indicating any undeclared activity.

Nor can the IAEA enforce access needed to clarify what it calls compelling intelligence reports suggesting Iran has researched ways of "weaponizing" enrichment with airborne explosive tests and work to revamp a Shahab-3 missile cone to fit a nuclear payload. Iran has acknowledged some of this military research but denied it had any nuclear applications, without giving backup evidence for its assertions.

* The IAEA has chided Iran for giving late, irrelevant and evasive answers to agency inquiries about its nuclear program including procurement and research-and-development work, despite Security Council resolutions demanding complete transparency.

* IAEA director Mohamed ElBaradei has told Iran it cannot dispel suspicions about its nuclear ambitions unless it honors the Additional Protocol and grants agency sleuths access to documentation, sites and nuclear officials for interviews.

(Reporting by Mark Heinrich; Editing by Michael Roddy)