[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3107 Introduced in House (IH)]
104th CONGRESS
2d Session
H. R. 3107
To impose sanctions on persons exporting certain goods or technology
that would enhance Iran's ability to explore for, extract, refine, or
transport by pipeline petroleum resources, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 19, 1996
Mr. Gilman (for himself, Mr. Berman, Mr. Gejdenson, Mr. Burton of
Indiana, Mr. King, Mr. Shaw, and Mr. Forbes) introduced the following
bill; which was referred to the Committee on International Relations,
and in addition to the Committees on Banking and Financial Services,
Ways and Means, and Government Reform and Oversight, for a period to be
subsequently determined by the Speaker, in each case for consideration
of such provisions as fall within the jurisdiction of the committee
concerned
_______________________________________________________________________
A BILL
To impose sanctions on persons exporting certain goods or technology
that would enhance Iran's ability to explore for, extract, refine, or
transport by pipeline petroleum resources, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Iran Oil Sanctions Act of 1996''.
SEC. 2. FINDINGS.
The Congress makes the following findings:
(1) The efforts of the Government of Iran to acquire
weapons of mass destruction and the means to deliver them and
its support of international terrorism endanger potentially the
national security and foreign policy interests of the United
States and those countries with which it shares common
strategic and foreign policy objectives.
(2) The objective of preventing the proliferation of
weapons of mass destruction and international terrorism through
existing multilateral and bilateral initiatives requires
additional efforts to deny Iran the financial means to sustain
its nuclear, chemical, biological, and missile weapons
programs.
(3) The Government of Iran uses its diplomatic facilities
and quasi-governmental institutions outside of Iran to promote
acts of international terrorism and assist its nuclear,
chemical, biological, and missile weapons programs.
SEC. 3. DECLARATION OF POLICY.
The Congress declares that it is the policy of the United States to
deny Iran the ability to support international terrorism and to fund
the development and acquisition of weapons of mass destruction and the
means to deliver them by limiting the development of Iran's ability to
explore for, extract, refine, or transport by pipeline petroleum
resources of Iran.
SEC. 4. IMPOSITION OF SANCTIONS.
(A) In General.--Except as provided in subsection (d), the
President shall impose 2 or more of the sanctions described in
paragraphs (1) through (5) of section 5 if the President determines
that a person has, with actual knowledge or reason to know, on or after
the date of the enactment of this Act--
(1) exported, transferred, or released to Iran, nationals
of Iran, or entities owned or controlled by Iran or nationals
of Iran any goods or technology identified on the List of
Petroleum and Natural Gas-Related Goods and Technology
established under section 9 (in this Act referred to as the
``List'') if the provision of such goods or technology would
significantly and materially enhance Iran's ability to develop
petroleum resources of Iran--
(A) whether or not the goods or technology is
exported from the United States; and
(B) whether or not the goods or technology is
subject to the jurisdiction of the United States; or
(2) made an investment of $40,000,000 or more (or any
combination of investments of a least $10,000,000 each, which
in the aggregate equals or exceeds $40,000,000 in any 12-month
period), that directly contributed to the enhancement of Iran's
ability to develop petroleum resources of Iran.
(b) Persons Against Which the Sanctions Are To Be Imposed.--The
sanctions described in subsection (a) shall be imposed on--
(1) the person with respect to whom the President makes the
determination subsection (a);
(2) any successor entity to the person with respect to whom
the President makes the determination subsection (a);
(3) any wholly owned subsidiary of the person with respect
to whom the President makes the determination subsection (a);
(4) any other subsidiary of the person with respect to whom
the President makes the determination under subsection (a) if
that subsidiary, with actual knowledge or reason to know,
engaged in the activities which were the basis of that
determination;
(5) any person that is a parent of the person with respect
to whom the President makes the determination under subsection
(a) if that parent had actual knowledge or reason to know of
the activities which were the basis of that determination; and
(6) any person that is an affiliate of the person with
respect to whom the President makes the determination under
subsection (a) if that affiliate, with actual knowledge or
reason to know, engaged in the activities which were the basis
of that determination.
For purposes of this Act, any person or entity described in this
subsection shall be referred to as a ``sanctioned person''.
(c) Publication in Federal Register.--The President shall cause to
be published in the Federal Register a current list of sanctioned
persons. The removal of names from, and the addition of names to, the
list, shall also be so published.
(d) Exceptions.--The President shall not be required to apply or
maintain the sanctions under subsection (a)--
(1) in the case of procurement of defense articles or
defense services--
(A) under existing contracts or subcontracts,
including the exercise of options for production
quantities to satisfy requirements essential to the
national security of the United States;
(B) if the President determines in writing that the
person to which the sanctions would otherwise be
applied is a sole source supplier of the defense
articles or services, that the defense articles or
services are essential, and that alternative sources
are not readily or reasonably available; or
(C) if the President determines in writing that
such articles or services are essential to the national
security under defense coproduction agreements;
(2) to products or services provided under contracts
entered into before the date on which the President publishes
his intention to impose the sanctions;
(3) to--
(A) spare parts which are essential to United
States products or production;
(B) component parts, but not finished products,
essential to United States products or production; or
(C) routine servicing and maintenance of products,
to the extent that alternative sources are not readily
or reasonably available;
(4) to information and technology essential to United
States products or production; or
(5) to medicines, medical supplies, or other humanitarian
items.
SEC. 5. DESCRIPTION OF SANCTIONS.
The sanctions to be imposed on a sanctioned person under section
4(a) are as follows:
(1) Export-import bank assistance for exports to sanctioned
persons.--The President shall direct the Export-Import Bank of
the United States not to guarantee, insure, extend credit, or
participate in the extension of credit in connection with the
export of any goods or services to any sanctioned person.
(2) Trade sanction.--The President shall both--
(A) order the United States Government not to issue
any specific license and not to grant any other
specific permission or authority to export any goods or
technology to a sanctioned person under--
(i) the Export Administration Act of 1979;
(ii) the Arms Export Control Act;
(iii) the Atomic Energy Act of 1954; or
(iv) any other statute that requires the
prior review and approval of the United States
Government as a condition for the export or re-
export of goods or services; and
(B) prohibit the importation into the United States
of products produced by any sanctioned person.
Subparagraph (B) includes application to the importation of any
finished product or component part, whether shipped directly by
the sanctioned person or by another entity.
(3) Loans from united states financial institutions.--The
United States Government shall prohibit any United States
financial institution from making any loan or providing any
credit to any sanctioned person in an amount exceeding
$10,000,000 (or two or more loans of more than $5,000,000 each
in any 12-month period) unless such person is engaged in
activities to relieve human suffering and the loan, loans, or
credit is provided for such activities.
(4) Prohibitions on financial institutions.--The following
prohibitions shall be imposed against a sanctioned person that
is a financial institution:
(A) Designation as primary dealer.--Neither the
Board of Governors of the Federal Reserve System nor
the Federal Reserve Bank of New York may designate, or
permit the continuation of any prior designation of,
such financial institution as a primary dealer in
United States Government debt instruments.
(B) Government funds.--Such financial institution
shall not serve as agent of the United States
Government or serve as repository for United States
Government funds.
(5) Procurement sanction.--The United States Government
shall not procure, or enter into any contract for the
procurement of, any goods or services from a sanctioned person.
SEC. 6. ADVISORY OPINIONS.
The Secretary of State may, upon the request of any person, issue
an advisory opinion to that person as to whether a proposed activity by
that person would subject that person to sanctions under this Act. Any
person who relies in good faith on such an advisory opinion which
states that the proposed activity would not subject a person to much
sanctions, and any person who thereafter engages in such activity, may
not be made subject to such sanctions on account of such activity.
SEC. 7. TERMINATION OF SANCTIONS.
The requirement under section 4 to impose sanctions shall no longer
have force or effect if the President determines and certifies to the
appropriate congressional committees that Iran--
(1) has ceased its efforts to design, develop, manufacture,
or acquire--
(A) a nuclear explosive device or related materials
and technology;
(B) chemical and biological weapons; and
(C) ballistic missiles and ballistic missile launch
technology; and
(2) has been removed from the list of countries the
governments of which have been determined, for purposes of
section 6(j) of the Export Administration Act of 1979, to have
repeatedly provided support for acts of international
terrorism.
SEC. 8. DURATION OF SANCTIONS; PRESIDENTIAL WAIVER.
(a) Delay of Sanctions.--
(1) Consultations.--If the President makes a determination
described in section 4(a) with respect to a foreign person, the
Congress urges the President to initiate consultations
immediately with the government with primary jurisdiction over
that foreign person with respect to the imposition of sanctions under
this Act.
(2) Actions by government of jurisdiction.--In order to
pursue such consultations with the government, the President
may delay imposition of sanctions under this Act for up to 90
days. Following such consultation, the President shall
immediately impose sanctions unless the President determines
and certifies to the Congress that the government has taken
specific and effective actions, including, as appropriate, the
imposition of appropriate penalties, to terminate the
involvement of the foreign person in the activities that
resulted in the determination by the President under section
4(a) concerning such person.
(3) Additional delay in imposition of sanctions.--The
President may delay the imposition of sanctions for up to an
additional 90 days if the President determines and certifies to
the Congress that the government with primary jurisdiction over
the process of taking the actions described in paragraph (2).
(4) Report to congress.--Not later than 45 days after
making a determination under section 4(a), the President shall
submit to the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on International Relations of
the House of Representatives a report on the status of
consultations with the appropriate foreign government under
this subsection, and the basis for any determination under
paragraph (3).
(b) Duration of Sanctions.--The requirement to impose sanctions
under section 4(a) shall remain in effect until the President
determines that the sanctioned person is no longer engaging in the
activity that led to the imposition of sanctions.
(c) Presidential Waiver.--
(1) Authority.--The President may waive the requirement in
section 4(a) to impose a sanction or sanctions on a person in
section 4(b), and may waive the continued imposition of a
sanction or sanctions under subsection (b) of this section, 30
days or more after the President determines and so reports to
the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on International Relations of the
House of Representatives that it is important to the national
interest of the United States to exercise such waiver
authority.
(2) Contents of report.--Any such report shall provide a
specific and detailed rationale for such determination,
including--
(A) a description of the conduct that resulted in
the determination;
(B) in the case of a foreign person, an explanation
of the efforts to secure the cooperation of the
government with primary jurisdiction of the sanctioned
person to terminate or, as appropriate, penalize the
activities that resulted in the determination;
(C) an estimate as to the significance of the
investment or the provision of the goods or technology,
as the case may be, to Iran's ability to develop its
petroleum resources; and
(D) a statement as to the response of the United
States in the event that such person engages in other
activities that would be subject to section 4(a).
(3) Effect of report on waiver.--If the President makes a
report under paragraph (1) with respect to a waiver of
sanctions on a person in section 4(b), sanctions need not be
imposed under section 4(a) on that person during the 30-day
period referred to in paragraph (1).
SEC. 9. GOODS AND TECHNOLOGY SUBJECT TO EXPORT CONTROL RESTRICTIONS.
(a) Control List.--
(1) Contents of list.--For purposes of the determinations
to be made under section 4(a), the President, in consultation
with the Secretary of State and the Secretary of Energy, and
the heads of other appropriate departments and agencies, shall
establish and maintain the List of Petroleum and Natural Gas-
Related Goods and Technology. The List shall consist of--
(A) all items listed in the Annex to Resolution 883
of the Security Council of the United Nations, adopted
November 11, 1993, and all types of equipment,
supplies, and grants of licenses prohibited by
paragraph 5 of that resolution; and
(B) any other goods or technology (including
software and technical data) that the President
determines could significantly or materially contribute
to Iran's ability to develop its petroleum resources,
including goods and technology that are required for
the development, production, or use of facilities
(including the repair, maintenance, or operation of
equipment) for the development of petroleum resources.
(2) Publication.--The President, within 60 days after the
date of the enactment of this Act, shall cause the List to be
published in the Federal Register, together with any
regulations issued with respect thereto. Thereafter, any
revisions to the List or amendments to the regulations shall be
published in the same manner.
(3) Advance notice to congress.--Not less than 30 days in
advance of the publication of the List, it shall be provided to
the Committee on Banking, Housing, and Urban Affairs of the
Senate and to the Committee on International Relations of the
House of Representatives. The President shall consult with such
Committee regarding the content of the List and shall respond
to questions regarding the basis for the inclusion on, or
exclusion from, the List of specified goods and technology.
(b) Statutory Construction.--Nothing in this section prevents the
inclusion on the List of any goods or technology that may be produced
in and traded internationally by persons or entities in countries other
than the United States.
SEC. 10. REPORTS REQUIRED.
(a) Report on Certain International Initiatives.--Not later than 6
months after the date of the enactment of this Act, and every 6 months
thereafter, the President shall transmit a report to the appropriate
congressional committees describing--
(1) the efforts of the President to mount a multilateral
campaign to persuade all countries to pressure Iran to cease
its weapons of mass destruction programs and its support of
international terrorism;
(2) the efforts of the President to persuade other
governments to ask Iran to reduce the presence of Iranian
diplomats and representatives of other government and military
or quasi-governmental institutions of Iran and to withdraw any
such diplomats or representatives who participated in the
takeover of the United States embassy in Tehran on November 4,
1979, or the subsequent holding of United States hostages for
444 days;
(3) the extent to which the International Atomic
Energy Agency has established regular inspections of
all nuclear facilities in Iran, including those
presently under construction; and
(4) Iran's use of Iranian diplomats and representatives of
other government and military or quasi-governmental
institutions of Iran to promote acts of terrorism or to develop
or sustain Iran's nuclear, chemical, biological, and missile
weapons programs.
(b) other Reports.--The President shall ensure the continued
transmittal to the Congress of reports describing--
(1) the nuclear and other military capabilities of Iran, as
required by section 601(a) of the Nuclear Non-Proliferation act
of 1978 and section 1607 of the National Defense Authorization
Act, Fiscal Year 1993; and
(2) the support provided by Iran for acts of international
terrorism, as part of the Department of State's annual report
on international terrorism.
SEC. 11. APPLICATION OF THE ACT TO LIBYA.
(a) In General.--The sanctions of this Act, including the terms and
conditions for the imposition, duration, and termination of sanctions,
shall apply to persons making investments with respect to the
development of petroleum resources of Libya, or exporting,
transferring, or releasing of certain goods or technology to Libya,
nationals of Libya, or entities owned or controlled by Libya, in the
same manner as those sanctions apply under this Act to persons making
investments with respect to the development of petroleum resources of
Iran, or exporting, transferring, or releasing of certain goods or
technology to Iran, nationals of Iran, or entities owned or controlled
by Iran.
(b) Application of Specific Provisions.--In applying the provisions
of this Act with respect to Libya under subsection (a) each reference
to ``Iran'' shall be deemed to be a reference to ``Libya''.
SEC. 12. DETERMINATIONS NOT REVIEWABLE.
A determination to impose sanctions under this Act shall not be
reviewable in any court.
SEC. 13. DEFINITIONS.
As used in this Act:
(1) Act of international terrorism.--The term ``act of
international terrorism'' means an act--
(A) which is violent or dangerous to human life and
that is a violation of the criminal laws of the United
States or of any State or that would be a criminal
violation if committed within the jurisdiction of the
United States or any State; and
(B) which appears to be intended--
(i) to intimidate or coerce a civilian
population;
(ii) to influence the policy of a
government by intimidation or coercion; or
(iii) to affect the conduct of a government
by assassination or kidnapping.
(2) Affiliate.--For purposes of section 4(b), a person is
an ``affiliate'' of another person if more than 50 percent of
the outstanding capital stock or other beneficial interest in
both persons is owned by a third person or both persons are
otherwise controlled by a third person.
(3) Appropriate congressional committees.--The term
``appropriate congressional committees'' means the Committees
on Banking, Housing, and Urban Affairs and Foreign Relations of
the Senate and the Committee on International Relations of the
House of Representatives.
(4) Component part.--The term ``component part'' has the
meaning given that term in section 11A(e)(1) of the Export
Administration Act of 1979 (50 U.S.C. App. 2410a(e)(1)).
(5) Develop and development.--To ``develop'', or the
``development'' of, petroleum resources means the exploration
for, or the extraction, refining, or transportation by pipeline
of, petroleum resources.
(6) Financial institution.--The term ``financial
institution'' includes--
(A) a depository institution (as defined in section
3(c)(1) of the Federal Deposit Insurance Act),
including a branch or agency of a foreign bank (as
defined in section 1(b)(7) of the International Banking
Act of 1978);
(B) a credit union;
(C) a securities firm, including a broker or
dealer;
(D) an insurance company, including an agency or
underwriter;
(E) any other company that provides financial
services; and
(F) any subsidiary of an entity described in any of
subparagraphs (A) through (E).
(7) Finished product.--The term ``finished product'' has
the meaning given that term in section 11A(e)(2) of the Export
Administration Act of 1979 (50 U.S.C. App. 2410a(e)(2)).
(8) Foreign person.--The term ``foreign person'' means--
(A) an individual who is not a United States person
or an alien lawfully admitted for permanent residence
into the United States; or
(B) a corporation, partnership, or other
nongovernment entity which is not a United States
person.
(9) Goods and technology.--The terms ``goods'' and
``technology'' have the meanings given those terms in section
16 of the Export Administration Act of 1979 (50 U.S.C. app.
2415).
(10) Investment.--The term ``investment'' means--
(A) the entry into a contract that includes
responsibility for the development of petroleum
resources located in Iran or Libya (as the case may
be), or the entry into a contract providing for the
general supervision and guarantee of anther person's
performance of such a contract;
(B) the purchase of a share of ownership in that
development;
(C) the entry into a contract providing for the
participation in royalties, earnings, or profits in
that development, without regard to the form of the
participation; or
(D) the entry into or performance of--
(i) a contract for the financing of the
development of petroleum resources located in
Iran or Libya (as the case may be); or
(ii) a guaranty of another person's
performance under such a contract.
(11) Iran.--The term ``Iran'' means--
(A) the territory of Iran; and
(B) any territory or marine areas over which the
Government of Iran claims sovereignty, sovereign
rights, or jurisdiction, if the Government of Iran
exercises partial or de facto control over such
territory or areas or derives a benefit from economic
activity in the territory or area pursuant to an
international agreement.
(12) Iranian diplomats and representatives of other
government and military or quasi-governmental institutions of
iran.--The term ``Iranian diplomats and representatives of
other government and military or quasi-governmental
institutions of Iran'' includes employees, representatives, or
affiliates of Iran's--
(A) Foreign Ministry;
(B) Ministry of Intelligence and Security;
(C) Revolutionary Guard Corps;
(D) Crusade for Reconstruction;
(E) Qods (Jerusalem) Forces;
(F) Interior Ministry;
(G) Foundation for the Oppressed and Disabled;
(H) Prophet's Foundation;
(I) June 5th Foundation;
(J) Martyr's Foundation;
(K) Islamic Propagation Organization; and
(L) Ministry of Islamic Guidance.
(13) Libya.--The term ``Libya'' means--
(A) the territory of Libya; and
(B) any territory or marine areas over which the
Government of Libya claims sovereignty, sovereign
rights, or jurisdiction, if the Government of Libya
exercises partial or de facto control over such
territory or area or derives a benefit from economic
activity in the territory or area pursuant to an
international agreement.
(14) Nuclear explosive device.--The term ``nuclear
explosive device'' means any device, whether assembled or
disassembled, that is designed to produce an instantaneous
release of an amount of nuclear energy from special nuclear
material (as defined in section 11aa. of the Atomic Energy Act
of 1954) that is greater than the amount of energy that would
be released from the detonation of one pound of trinitrotoluene
(TNT).
(15) Parent.--For purposes of section 4(b), a person is a
``parent'' of another person if that person owns, directly or
indirectly, more than 50 percent of the outstanding capital
stock or other beneficial interest in that other person, or
otherwise controls that other person.
(16) Person.--The term ``person'' means a natural person as
well as a corporation, business association, partnership,
society, trust, any other nongovernmental entity, organization,
or group, and any governmental entity operating as a business
enterprise, and any successor to any such entity.
(18) Petroleum resources.--The term ``petroleum resources''
includes petroleum and natural gas resources.
(19) Subsidiary.--(A) For purposes of section 4(b), and
subject to subparagraph (B), a person is a ``subsidiary'' of
another person if that other person owns, directly or
indirectly, more than 50 percent of the outstanding capital
stock or other beneficial interest in that person, or otherwise
controls that person.
(B) A person is a ``wholly owned'' subsidiary of another
person if all the outstanding capital stock or other beneficial
interests of that person are owned by that other person.
(20) United states or state.--The term ``United States'' or
``State'' means the several States, the District of Columbia,
the Commonwealth of Puerto Rico, the Commonwealth of the
Northern Mariana Islands, American Samoa, Guam, the United
States Virgin Islands, and any other territory or possession of
the United States.
(21) United states person.--The term ``United States
person'' means--
(A) a natural person who is a citizen of the United
States or who owes permanent allegiance to the United
States; and
(B) a corporation or other legal entity which is
organized under the laws of the United States, any
State or territory thereof, or the District of
Columbia, if natural persons described in subparagraph
(A) own, directly or indirectly, more than 50 percent
of the outstanding capital stock or other beneficial
interest in such legal entity.
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