(Corrects frequency of Assembly of Experts election and year of meeting with political prisoners)
* Hassan is the first Khomeini to run for an election
* He is a progressive cleric close to moderate Rouhani
* Supreme Leader warned him not to damage Khomeini's name
* Election is for a clerical body that appoints the Supreme Leader
By Bozorgmehr Sharafedin
DUBAI, Dec 17 (Reuters) - A grandson of Ayatollah Ruhollah Khomeini is expected to seek election early next year to the body that chooses Iran's supreme leader and is said to have the cautious blessing of the incumbent, Ayatollah Ali Khamenei.
Registration opens on Thursday for the election that is likely to see the first member of the family of Iran's revolutionary founder test his popularity at the ballot box.
Hassan Khomeini's expected candidacy in February's vote is already causing a heated row between hardliners and moderates, since membership of the assembly would place him at the top of Iran's political establishment. Some say he has his eyes eventually on the top job.
Hassan Khomeini, 43, a politically moderate cleric, intends to nominate himself in coming days, family friends and sources close to him told Reuters.
With powerful backers he is well-placed to win a seat on the 88-member assembly.
With both Khomeini's sons now dead, Hassan Khomeini, who has close links with reformists, is seen as the main family heir, and his decision to enter politics has set Tehran's political world abuzz.
A source close to Khomeini said he had received the approval of the incumbent, Ayatollah Ali Khamenei, at a meeting last week at which the Supreme Leader cautioned that he should be careful not to bring his grandfather's name into disrepute.
Khamenei told him: "There is no problem (with your nomination), only be careful not to damage Khomeini's name and respect," the source said.
Khamenei is 76, so the new assembly is expected to play a significant role in choosing his successor since its members are only elected every eight years.
Hassan Khomeini is close to the pragmatic, centrist President Hassan Rouhani, whose popularity has risen thanks to a nuclear deal his government struck with world powers in July.
Rouhani and his powerful ally, Akbar Hashemi Rafsanjani, are hoping to cash in on that popularity to help like-minded politicians win a majority in the assembly and in a parliamentary election that will be held on the same day.
Rouhani and Rafsanjani, veteran members of the assembly, hope an alliance they appear to be forming with the young Khomeini will bring a breath of fresh air to their camp.
"Hassan Khomeini is a progressive theologian, especially when it comes to music, women's rights and social freedom," one of his close friends told Reuters on condition of anonymity.
"He closely follows trends on social media and reads the papers. He is interested in Western philosophy as much as Islamic thoughts," he added.
The friend said Khomeini had spent time in Malaysia in order to improve his English. At home, he used to sit in the ordinary seats at football matches rather than the VIP section.
A REFORMIST KHOMEINI
Last year, Khomeini made a rare appearance on state television's most popular football programme, and showed a detailed knowledge of Iran's league. He was a passionate football player until 21, when his grandfather insisted that he must go to city of Qom to study Islamic theology.
"I was good in defence and if I had continued football I might have achieved something," he said last week, meeting Iran's top footballers in his office.
Hassan Khomeini has four children and his son Ahmad has become an Instagram celebrity in Iran, with almost 200,000 followers. The unusually private photos he posts show his father's close friendship with reformists, especially former president Mohammad Khatami, now out of favour with Khamenei.
Khatami sided with protesters who staged unprecedented street demonstrations following disputed elections in 2009.
Hassan Khomeini does not side publicly with the reformists, but in defiance of the wave of arrests that followed the protests, he met political prisoners Alireza Beheshti and Mohammadreza Jalaeipour shortly after their release in 2009.
"The Khomeini family has close ties with the reformists through several marriages. Hassan Khomeini and Khatami have been hangout buddies for a long time, hiking and swimming together," a political activist close to both told Reuters.
Hassan Khomeini declined some reformists' demand to become a presidential candidate in 2012, but now his expected candidacy for the Assembly of Experts suggests his political ambitions are focused on wielding influence at a high level. Khomeini could not immediately be reached.
"What you see is a clear rivalry between Hassan Khomeini and Mojtaba Khamenei, the son of the current Supreme Leader," a politician said on condition of anonymity.
"They both want to succeed Ayatollah Khamenei, so they have both started teaching Kharej in Qom, the advanced courses of Islamic jurisprudence that is necessary to become an Ayatollah," he explains.
Mojtaba Khamenei, also in his 40s, is close to the conservatives and the Revolutionary Guards. He is widely believed to have been behind the sudden rise of Mahmoud Ahmadinejad to presidency in 2005 and his contested re-election in 2009.
"KHOMEINI VS. KHOMEINI"
Twenty-six years after his death, Ayatollah Khomeini's words are still considered in effect as Iran's second constitution, and people can end up in jail for even making jokes about them.
Hassan Khomeini's supporters do not expect him to criticise the legacy of the Ayatollah, but hope that he will revive the forgotten aspects of the Father of the Revolution.
"Those who claim to be loyal to the Imam Khomeini should follow his order that the military must stay out of politics," Hassan Khomeini told the Shahrvand weekly in 2008.
His comments were seen as a direct attack on the Revolutionary Guards, a military force with huge political influence in the country.
"Hassan Khomeini is promoting the modern and democratic side of his grandfather's legacy and stays silent about the dark, authoritarian side," said Yaser Mirdamadi, a researcher in philosophy and religious studies who has closely studied his lectures.
"He wants to show the real Khomeini respects the rights of all groups, and that the totalitarian side was a temporary necessity during early years of the revolution," he added.
Mirdamadi believes hardliners who revere the radical, anti-western Khomeini will oppose what they would see as the grandson's selective interpretation of his legacy, warning against the emergence of a "Khomeini vs. Khomeini".
In a thinly veiled attack on the cleric, the hardline Keyhan newspaper, which is close to Khamenei, said last week that the candidacy of Hassan Khomeini was a "tactical move to camouflage the new revisionism" in Iran that wants to "possess a part of Imam Khomeini's family and use it against Khomeini's real path".
A close relative played down the suggestion that the election of Hassan Khomeini would heighten tension between him and the hardliners. He suggested Hassan's character was calm, pragmatic and non-confrontational.
"Hassan Khomeini is not as radical and revolutionary as his grandfather. And that is his main strength." (Editing by William Maclean and Giles Elgood)
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