DUBAI/PARIS (Reuters) - Iran’s top judge said on Monday that Tehran would never accept the “humiliating conditions” set by the European Union for non-dollar trade intended to evade U.S. sanctions, the semi-official Tasnim news agency reported.

A man counts Iranian rials at a currency exchange shop, before the start of the U.S. sanctions on Tehran, in Basra, Iraq November 3, 2018. Picture taken November 3, 2018. REUTERS/Essam al-Sudani

France, Germany and Britain have opened a new channel for non-dollar trade with Iran to get around the sanctions, reimposed on Iran after President Donald Trump’s decision in May to exit a 2015 nuclear deal between Tehran and six major powers.

“After nine months of procrastination and negotiation, Europeans have created a mechanism with limited capacity ... only for food and medicine,” Tasnim quoted Sadeq Amoli-Larijani as saying.

“Iran will never accept their strange and humiliating conditions of joining the FATF (the Financial Action Task Force) and negotiations on its missile program.”

A French, British and German statement on Friday made no mention of any preconditions, although the European powers must now establish a budget and define its rules before the mechanism can be operational.

Welcoming their move, Iranian Deputy Foreign Minister Abbas Araqchi said on Friday Tehran would also have to set up a mirror company. The two sides are to hold talks this week on the process.

The European statement said they expected Iran to swiftly implement all elements of its FATF action plan.

“FATF is not a precondition, it’s a strong expectation,” said a senior European diplomat, dismissing any suggestion that ballistic missile talks had anything to do with creating the mechanism.

Iran has threatened to pull out of the nuclear deal unless the European powers enable it to receive economic benefits. The Europeans have promised to help companies do business with Iran as long as it abides by the deal.

New U.S. sanctions have largely succeeded in persuading European companies to abandon business with Iran, and Washington said it did not expect the EU effort - known as INSTEX, or Instrument for Supporting Trade Exchanges - to change that.

Even as European powers have worked to preserve the nuclear deal, relations with Tehran have been worsening. The EU this month imposed its first sanctions on Iran since the nuclear pact, in response to assassination plots on European soil.

They are also considering whether to push for sanctions on Iran’s ballistic missile program if talks between the two sides on the issue do not progress.