Short title

This Act may be cited as the

Iran Counter-Proliferation Act of 2007

Findings

Congress makes the following findings: (1)For more than 20 years, Iran has pursued a secret nuclear program that is intended to produce a nuclear weapons capability for Iran. (2)The Government of Iran has consistently misled the United Nations, the International Atomic Energy Agency, and the United States as to the objectives and scope of its nuclear activities. (3)Iran has refused to comply with United Nations Security Council Resolution 1737, adopted on December 23, 2006, which called for the suspension of all enrichment-related and reprocessing activities and is advancing work at its largest nuclear facility. (4)The International Atomic Energy Agency is unable to verify the absence of undeclared nuclear material and activities in Iran and its Director-General has stated that Iran could be 6 months to a year away from acquiring the material necessary to make a nuclear weapon. (5)An Iranian nuclear weapons capability poses a grave threat to the security of the United States and its allies around the world. (6)It is in the national security interests of the United States to prevent Iran from acquiring a nuclear weapons capability. (7)The United States should use all political, economic, and diplomatic tools at its disposal to prevent Iran from acquiring a nuclear weapons capability. (8)Nothing in this Act should be construed as giving the President the authority to use military force against Iran.

Sense of Congress

The following is the sense of Congress: (1)The United States should pursue vigorously all measures in the international financial sector to restrict Iran's ability to conduct international financial transactions, including prohibiting banks in the United States from handling indirect transactions with Iran’s state-owned banks and prohibiting financial institutions that operate in United States currency from engaging in dollar transactions with Iranian institutions. (2)The United States Trade Representative or any other Federal official should not take any action that would extend preferential trade treatment to, or lead to the accession to the World Trade Organization of, any country that is determined by the Secretary of State to offer government-backed export credit guarantees to companies that invest in Iran or any country in which the government owns or partially owns an entity that invests in Iran. (3)Iran should comply fully with its obligations under United Nations Security Council Resolution 1737, and any subsequent United Nations resolutions related to Iran's nuclear program, and in particular the requirement to suspend without delay all enrichment-related and reprocessing activities, including research and development, and all work on all heavy water-related nuclear activities, including research and development. (4)The United Nations Security Council should take further measures beyond Resolution 1737 to tighten sanctions on Iran, including preventing new investment in Iran's energy sector, as long as Iran fails to comply with the international community's demand to halt its nuclear enrichment campaign. (5)The United States should encourage foreign governments to direct state-owned entities to cease all investment in Iran's energy sector and all imports to and exports from Iran of refined petroleum products and to persuade, and, where possible, require private entities based in their territories to cease all investment in Iran's energy sector and all imports to and exports from Iran of refined petroleum products. (6)Administrators of Federal and State pension plans should divest all assets or holdings from foreign companies and entities that have invested or invest in the future in Iran’s energy sector. (7)Iranian state-owned banks should not be permitted to use the banking system of the United States. (8)The Secretary of State should designate the Iranian Revolutionary Guards as a Foreign Terrorist Organization under section 219 of the Immigration and Nationality Act (8 U.S.C. 1189) and the Secretary of the Treasury should place the Iranian Revolutionary Guards on the list of Specially Designated Global Terrorists under Executive Order 13224 (66 Fed. Reg. 186; relating to blocking property and prohibiting transactions with persons who commit, threaten to commit, or support terrorism).

Definitions

In this Act: (1)

Appropriate congressional committees

The term appropriate congressional committees has the meaning given that term in section 14(2) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note). (2)

Investment

The term investment has the meaning given that term in section 14(9) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note). (3)

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 has the meaning given that term in section 14(11) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note). (4)

Family member

The term family member means, with respect to an individual, the spouse, children, grandchildren, or parents of the individual.

Clarification and expansion of definitions

(a)

Person

Section 14(13)(B) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note) is amended— (1)by inserting financial institution, insurer, underwriter, guarantor, and other business organization, including any foreign subsidiary, parent, or affiliate of the foregoing, after trust,; and (2)by inserting , such as an export credit agency before the semicolon. (b)

Petroleum resources

Section 14(14) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note) is amended by striking petroleum and natural gas resources and inserting petroleum, petroleum by-products, liquefied natural gas, oil or liquefied natural gas, oil or liquefied natural gas tankers, and products used to construct or maintain pipelines used to transport oil or liquefied natural gas.

Russia nuclear cooperation

(a)

In general

Notwithstanding any other provision of law, and in addition to any other sanction in effect, beginning on the date that is 15 days after the date of the enactment of this Act, the policies described in subsection (b) shall apply with respect to Russia, unless the President makes a certification to Congress described in subsection (c). (b)

Policies

The policies described in this subsection are the following: (1)

Agreements

The United States may not enter into an agreement for cooperation with Russia pursuant to section 123 of the Atomic Energy Act (42 U.S.C. 2153). (2)

Licenses to export nuclear material, facilities, or components

The United States may not issue a license to export directly or indirectly to Russia any nuclear material, facilities, components, or other goods, services, or technology that would be subject to an agreement under section 123 of the Atomic Energy Act (42 U.S.C. 2153). (3)

Transfers of nuclear material, facilities, or components

The United States may not approve the transfer or retransfer directly or indirectly to Russia of any nuclear material, facilities, components, or other goods, services, or technology that would be subject to an agreement under section 123 of the Atomic Energy Act (42 U.S.C. 2153). (c)

Certification

The certification described in this subsection means a certification made by the President to Congress on or after the date that is 15 days after the date of the enactment of this Act that the President has determined that— (1)Russia has suspended all nuclear assistance to Iran and all transfers of advanced conventional weapons and missiles to Iran; or (2)Iran has completely, verifiably, and irreversibly dismantled all nuclear enrichment-related and reprocessing-related programs. (d)

Termination of policies

The policies described in subsection (b) shall remain in effect until such time as the President makes the certification to Congress described in subsection (c).

Economic Sanctions relating to Iran

(a)

In general

Notwithstanding any other provision of law, and in addition to any other sanction in effect, beginning on the date that is 15 days after the date of the enactment of this Act, the economic sanctions described in subsection (b) shall apply with respect to Iran, unless the President makes a certification to Congress described in subsection (c). (b)

Sanctions

The sanctions described in this subsection are the following: (1)

Prohibition on imports

No article that is grown, produced, or manufactured in Iran may be imported directly or indirectly into the United States. (2)

Prohibition on exports

(A)

In general

Except as provided in subparagraph (B), no article that is the growth, product, or manufacture of the United States may be exported directly or indirectly to Iran. (B)

Exception for food and medicine

The prohibition in subparagraph (A) does not apply to exports to Iran of food and medicine grown, produced, or manufactured in the United States. (3)

Accession to WTO

The United States Trade Representative or any other Federal official may not take any action that would extend preferential trade treatment to, or lead to the accession to the World Trade Organization of— (A)Iran; or (B)any other country that is determined by the Secretary of State to be— (i)engaged in nuclear cooperation with Iran, including the transfer or sale of any item, material, goods, or technology that can contribute to uranium enrichment or nuclear reprocessing activities of Iran; or (ii)contributing to the ballistic missile programs of Iran. (4)

Freezing assets

(A)

In general

At such time as the United States has access to the names of Iranian diplomats and representatives of other government and military or quasi-governmental institutions of Iran, the President shall take such action as may be necessary to freeze immediately the funds and other assets belonging to anyone so named, the family members of those so named, and any associates of those so named to whom assets or property of those so named were transferred on or after January 1, 2007. The action described in the preceding sentence includes requiring any United States financial institution that holds funds and assets of a person so named to report promptly to the Office of Foreign Assets Control information regarding such funds and assets. (B)

Asset reporting requirement

Not later than 14 days after a decision is made to freeze the property or assets of any person under this paragraph, the President shall report the name of such person to the appropriate congressional committees. (5)

United States Government contracts

The United States Government may not procure, or enter into a contract for the procurement of, any goods or services from a person that meets the criteria for the imposition of sanctions under section 5(a) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note). (c)

Certification described

The certification described in this subsection means a certification made by the President to Congress beginning on the date that is 15 days after the date of the enactment of this Act that the President has determined that Iran has completely, verifiably, and irreversibly dismantled all nuclear enrichment-related and reprocessing-related programs. (d)

Termination of sanctions

The sanctions described in subsection (b) shall remain in effect until such time as the President makes the certification to Congress described in subsection (c).

Liability of parent companies for violations of sanctions by foreign entities

(a)

In General

In any case in which an entity engages in an act outside the United States that, if committed in the United States or by a United States person, would violate the provisions of Executive Order 12959 (60 Fed. Reg. 89) or Executive Order 13059 (62 Fed. Reg. 162), or any other prohibition on transactions with respect to Iran imposed under the authority of the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.), the parent company of the entity shall be subject to the penalties for the act to the same extent as if the parent company had engaged in the act. (b)

Applicability

Subsection (a) shall not apply to a parent company of an entity on which the President imposed a penalty for a violation described in subsection (a) that was in effect on the date of the enactment of this Act if the parent company divests or terminates its business with such entity not later than 90 days after such date of enactment. (c)

Definitions

In this section: (1)

Entity

The term entity means a partnership, association, trust, joint venture, corporation, or other organization. (2)

Parent company

The term parent company means an entity that is a United States person and— (A)the entity owns, directly or indirectly, more than 50 percent of the equity interest by vote or value in another entity; (B)board members or employees of the entity hold a majority of board seats of another entity; or (C)the entity otherwise controls or is able to control the actions, policies, or personnel decisions of another entity. (3)

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)an entity that 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 entity.

Elimination of certain tax incentives for oil companies investing in Iran

(a)

In general

Subsection (h) of section 167 of the Internal Revenue Code of 1986 (relating to amortization of geological and geophysical expenditures) is amended by adding at the end the following new paragraph:

(6)

Denial when Iran sanctions in effect

(A)

In general

If sanctions are imposed under section 5(a) of the Iran Sanctions Act of 1996 or section 7 of the Iran Counter-Proliferation Act of 2007 (relating to sanctions with respect to the development of petroleum resources of Iran) on any member of an expanded affiliated group the common parent of which is a foreign corporation, paragraph (1) shall not apply to any expense paid or incurred by any such member in any period during which the sanctions are in effect. (B)

Expanded affiliated group

For purposes of subparagraph (A), the term expanded affiliated group means an affiliated group as defined in section 1504(a), determined— (i)by substituting more than 50 percent for at least 80 percent each place it appears, and (ii)without regard to paragraphs (2), (3), and (4) of section 1504(b).

(b)

Effective date

The amendment made by subsection (a) shall apply to expenses paid or incurred on or after January 1, 2007.

10.

World Bank loans to Iran

(a)

Report

Not later than 180 days after the date of the enactment of this Act, and every 180 days thereafter, the Secretary of the Treasury shall submit to the appropriate congressional committees a report on— (1)the number of loans provided by the World Bank to Iran; (2)the dollar amount of such loans; and (3)the voting record of each member of the World Bank on such loans. (b)

Reduction of contribution of the United States

The President shall reduce the total amount otherwise payable on behalf of the United States to the World Bank for fiscal year 2008 and each fiscal year thereafter by an amount that bears the same ratio to the total amount otherwise payable as— (1)the total of the amounts provided by the Bank to entities in Iran, and for projects and activities in Iran, in the preceding fiscal year, bears to (2)the total of the amounts provided by the Bank to all entities, and for all projects and activities, in the preceding fiscal year. (c)

Allocation of amounts not contributed to the World Bank

There is authorized to be appropriated to the United States Agency for International Development for fiscal year 2008 and each fiscal year thereafter an amount equal to the revenues made available as a result of the application of subsection (b). Funds appropriated pursuant to this subsection shall be made available for the Child Survival and Health Programs Fund to carry out programs relating to maternal and child health, vulnerable children, and infectious diseases other than HIV/AIDS.

11.

Increased capacity for efforts to combat unlawful or terrorist financing

(a)

Findings

The work of the Office of Terrorism and Financial Intelligence of the Department of Treasury, which includes the Office of Foreign Assets Control and the Financial Crimes Enforcement Center, is critical to ensuring that the international financial system is not used for purposes of supporting terrorism and developing weapons of mass destruction. (b)

Authorization

There is authorized to be appropriated to the Secretary of the Treasury for the Office of Terrorism and Financial Intelligence— (1)$59,466,000 for fiscal year 2008; and (2)such sums as may be necessary for each of the fiscal years 2009 and 2010. (c)

Authorization amendment

Section 310(d)(1) of title 31, United States Code, is amended by striking such sums as may be necessary for fiscal years 2002, 2003, 2004, and 2005 and inserting $85,844,000 for fiscal year 2008 and such sums as may be necessary for each of the fiscal years 2009 and 2010.

12.

National Intelligence Estimate on Iran

As required under section 1213 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (Public Law 109–364; 120 Stat. 2422), the Director of National Intelligence shall submit to Congress an updated, comprehensive National Intelligence Estimate on Iran.

13.

Exchange programs with the people of Iran

(a)

Sense of Congress

It is the sense of Congress that the United States should seek to enhance its friendship with the people of Iran, particularly by identifying young people of Iran to come to the United States under United States exchange programs. (b)

Exchange programs authorized

The President is authorized to carry out exchange programs with the people of Iran, particularly the young people of Iran. Such programs shall be carried out to the extent practicable in a manner consistent with the eligibility for assistance requirements specified in section 302(b) of the Iran Freedom Support Act (Public Law 109–293; 120 Stat. 1348). (c)

Authorization

Of the amounts available under the heading Educational and Cultural Exchange Programs, under the heading Administration of Foreign Affairs, under title IV of the Science, State, Justice, Commerce, and Related Agencies Appropriations Act, 2006 (Public Law 109–108; 119 Stat. 2321), there is authorized to be appropriated to the President to carry out this section $10,000,000 for fiscal year 2008.

14.

Radio Broadcasting to Iran

The Broadcasting Board of Governors shall devote a greater proportion of the programming of the Radio Farda service to programs offering news and analysis to further the open communication of information and ideas to Iran.

15.

International Regime for the Assured Supply of Nuclear Fuel for Peaceful Means

(a)

Sense of Congress

It is the sense of Congress that— (1)the Concept for a Multilateral Mechanism for Reliable Access to Nuclear Fuel, proposed by the United States, France, the Russian Federation, the Federal Republic of Germany, the United Kingdom, and the Netherlands on May 31, 2006, is welcome and should be expanded upon at the earliest possible opportunity; (2)the proposal by the Government of the Russian Federation to bring one of its uranium enrichment facilities under international management and oversight is also a welcome development and should be encouraged by the United States; (3)the offer by the Nuclear Threat Initiative (NTI) of $50,000,000 in funds to support the creation of an international nuclear fuel bank by the International Atomic Energy Agency (IAEA) is also welcome, and the United States and other member states of the IAEA should pledge collectively at least an additional $100,000,000 in matching funds to fulfill the NTI proposal; and (4)the Global Nuclear Energy Partnership, initiated by President Bush in January 2006, is intended to provide a reliable fuel supply throughout the fuel cycle and promote the nonproliferation goals of the United States. (b)

Policy

It is the policy of the United States to support the establishment of an international regime for the assured supply of nuclear fuel for peaceful means under a multilateral authority, such as the International Atomic Energy Agency. (c)

Contributions to IAEA

(1)

In general

Subject to the requirements of paragraph (2), the President is authorized to make voluntary contributions on a grant basis to the International Atomic Energy Agency (referred to in this subsection as the IAEA) for the purpose of supporting the establishment of an international nuclear fuel bank to maintain a reserve of low-enriched uranium for the production of reactor fuel to provide to eligible countries in the case of a disruption in the supply of reactor fuel by normal market mechanisms. (2)

Requirements for contributions

Before making a contribution under paragraph (1), the President shall certify to the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate that— (A)the IAEA has received pledges in a total amount of not less than $100,000,000 from other governments or entities for the purpose of supporting the establishment of the international nuclear fuel bank referred to in paragraph (1); (B)the international nuclear fuel bank referred to in paragraph (1) will be under the oversight of the IAEA or another multilateral authority; and (C)the international nuclear fuel bank will provide nuclear reactor fuel to a country only if— (i)at the time of the request for nuclear reactor fuel, the country is in full compliance with its IAEA safeguards agreement and has an additional protocol for safeguards in force; (ii)in the case of a country that at any time prior to the request for nuclear reactor fuel has been determined to be in noncompliance with its IAEA safeguards agreement, the IAEA Board of Governors determines that the country has taken all necessary actions to satisfy any concerns of the IAEA Director General regarding the activities that led to the prior determination of noncompliance; (iii)the country agrees to use the nuclear reactor fuel in accordance with its IAEA safeguards agreement; and (iv)the country does not operate uranium enrichment or spent-fuel reprocessing facilities of any scale. (3)

Authorization of appropriations

There is authorized to be appropriated $50,000,000 to carry out this section for fiscal year 2008. Amounts appropriated for this section are authorized to remain available until September 30, 2010.

16.

Reporting Requirements

(a)

Foreign investment in Iran

Not later than 180 days after the date of the enactment of this Act, and every 180 days thereafter, the Secretary of the Treasury shall submit to the appropriate congressional committees a report on— (1)any foreign investments made in Iran’s energy sector since January 1, 2007; and (2)the determination of the President on whether each such investment qualifies as a sanctionable offense under section 5(a) of the Iran Sanctions Act of 1996 (Public Law 104–172; 50 U.S.C. 1701 note). (b)

Investment by United States companies in Iran

Not later than 180 days after the date of the enactment of this Act, and annually thereafter, the Secretary of the Treasury shall report to the appropriate congressional committees the names of persons that have operations or conduct business in the United States that have invested in Iran and the dollar amount of each such investment. (c)

Investment by Federal thrift savings plan in Iran

Not later than 180 days after the date of the enactment of this Act, and annually thereafter, the Executive Director of the Federal Retirement Thrift Investment Board shall report to the appropriate congressional committees on any investment in entities that invest in Iran from the Thrift Savings Fund established under section 8437 of title 5, United States Code. (d)

List of designated foreign terrorist organizations

Not later than 180 days after the date of the enactment of this Act, the Secretary of State and the Secretary of the Treasury shall report to the appropriate congressional committees on the efforts of the Secretary of State and the Secretary of the Treasury to place the Iranian Revolutionary Guards on the list of designated Foreign Terrorist Organizations under section 219 of the Immigration and Nationality Act (8 U.S.C. 1189) and the list of Specially Designated Global Terrorists under Executive Order 13224 (66 Fed. Reg. 186; relating to blocking property and prohibiting transactions with persons who commit, threaten to commit, or support terrorism). (e)

Establishment of international regime

Not later than 180 days after the date of the enactment of this Act, the President shall submit to the Committee on Foreign Affairs of the House of Representatives and the Committee on Foreign Relations of the Senate a report on the activities of the United States to support the establishment of an international regime for the assured supply of nuclear fuel for peaceful means under a multilateral authority, such as the International Atomic Energy Agency. (f)

Export credits

Not later than 90 days after the date of the enactment of this Act, and every 90 days thereafter, the Secretary of the Treasury shall report to the appropriate congressional committees on the export credits issued by foreign banks to persons investing in the energy sector of Iran, and any fines, restrictions, or other actions taken by the President to discourage or prevent the issuance of such export credits.