Iran's pistachios are regularly stopped at the EU's borders for being contaminated with high levels of aflatoxins. The EU inspectors' report into the problem is part of the bloc's food safety crackdown on overseas food suppliers.
If the problem continues, Iran could face tougher border controls and even bans on its pistachio exports to the EU - resulting in a supply problem for snack manufacturers.
The report was published last week by the EU's Food and Veterinary Office (FVO). Inspectors visited the country' facilities and analysed the measures in place for the control of aflatoxin in Iran's pistachios.
In their report EU inspectors who visited the country said that Iran's pistachio producers do not enforce internationally accepted food safety and manufacturing practices.
In addition, training of inspectors and use of equipment was judged 'deficient'. Not all of the country's pistachio-testing laboratories were found to have performed regular international proficiency tests.
The report was undertaken following a rising number of regulatory notifications issued by the EU's Rapid Alert System for Food and Feed (RASFF) and the rejection of many Iranian pistachio consignments at member states' borders.
Border rejections were due to a higher aflatoxin content than that specified in EU legal limits. Alfatoxins are a group of toxic compounds produced by certain moulds, that when ingested may eventually harm the liver and other organs.
Iran has been warned in the past about the problem and EU border inspectors have increased testing on the product, among other measures.
EU rapid alerts are designed to provide regulators in the bloc with an early warning system in relation to unsafe produce.
From January to November 2005 - when the FVO investigation took place - there were 425 RASFF notifications relating to illegal levels of aflatoxins in Iran's pistachios, prompting fears that the country were not adhering to good agricultural practice (GAP) or good manufacturing practice (GMP).
EU inspectors reported that Iran's producers: "do not enforce GAP and GMP principles systematically in this industry and RASFF notifications are not followed up at the exporters concerned."
While the report found a "good framework control system in place" overall, several deficiencies were cause for concern - in particular the failure of authorities in Iran to act on RASFF alerts.
The team, which included two FVO inspectors and an Iranian expert, visited companies, farmers and laboratories to examine all elements of the production chain, from harvesting to processing and eventual shipment.
In order to combat the faults within the Iranian system, the FVO noted that temporary suspension of health certificates for certain exporters would have a beneficial effect and advised follow-up of RASFF notifications at the individual exporter's premises.
Referring to the application of GAP and GMP, they stated: "A significant reduction of the number of pistachio consignments not complying with EU limits for aflatoxins can only be achieved by uniform application of these principles by all operators and their enforcement by the Ministry of Health."
Now Iran's authorities must produce an action plan of what measures they will introduce to improve safety procedures - measures must be set in motion within two weeks of the action plan being published.
Iran exported 48,809 metric tones to the EU in 2004. Last year, it took the top spot on the EU's list of countries with the greatest number of alerts and notifications for foods found to have contaminants or illegal substances.