[House Document 104-137]
[From the U.S. Government Publishing Office]
104th Congress, 1st Session - - - - - - - - - - - - House
Document 104-137
DEVELOPMENTS CONCERNING THE NATIONAL EMERGENCY WITH RESPECT TO IRAN
__________
MESSAGE
from
THE PRESIDENT OF THE UNITED STATES
transmitting
A REPORT ON DEVELOPMENTS SINCE HIS LAST REPORT OF MAY 18, 1995,
CONCERNING THE NATIONAL EMERGENCY WITH RESPECT TO IRAN, PURSUANT TO 50
U.S.C. 1703(c) AND 22 U.S.C. 2349aa-9(c)
November 28, 1995.--Message and accompanying papers referred to the
Committee on International Relations and ordered to be printed
To the Congress of the United States:
I hereby report to the Congress on developments since the
last Presidential report of May 18, 1995, concerning the
national emergency with respect to Iran that was declared in
Executive Order No. 12107 of November 14, 1979. This report is
submitted pursuant to section 204(c) of the International
Emergency Economic Powers Act, 50 U.S.C. 1703(c) and section
505(c) of the International Security and Development
Cooperation Act of 1985, 22 U.S.C. 2349aa-9(c). This report
covers events through September 29, 1995. My last report, dated
May 18, 1995, covered events through April 18, 1995.
1. On March 15 of this year by Executive Order No. 12957, I
declared a separate national emergency pursuant to the
International Emergency Economic Powers Act and imposed
separate sanctions. Executive Order No. 12959, issued May 6,
1995, then significantly augmented those new sanctions. As a
result, as I reported on September 18, 1995, in conjunction
with the declaration of a separate emergency and the imposition
of new sanctions, the Iranian Transactions Regulations, 31 CFR
Part 560, have been comprehensively amended.
There have been no amendments to the Iranian Assets Control
Regulations, 31 CFR Part 535, since the last report. However,
the amendments to the Iranian Transactions Regulations that
implement the new separate national emergency are of some
relevance to the Iran-United States Claims Tribunal (the
``Tribunal'') and related activities. For example, sections
560.510, 560.513, and 560.525 contain general licenses with
respect to, and provide for specific licensing of, certain
transactions related to arbitral activities.
2. The Tribunal, established at The Hague pursuant to the
Algiers Accords, continues to make progress in arbitrating the
claims before it. Since my last report, the Tribunal has
rendered four awards, bringing the total number to 566. As of
September 29, 1995, the value of awards to successful American
claimants from the Security Account held by the NV Settlement
Bank stood at $2,368,274,541.67.
Iran has not replenished the Security Account established
by the Accords to ensure payment of awards to successful U.S.
claimants since October 8, 1992. The Account has remained
continuously below the $500 million balance required by the
Algiers Accords since November 5, 1992. As of September 29,
1995, the total amount in the Security Account was
$188,105,627.95, and the total amount in the Interest Account
was $32,066,870.62.
Therefore, the United States continues to pursue Case A/28,
filed in September 1993, to require Iran to meet its
obligations under the Accords to replenish the Security
Account. Iran filed its Statement of Defense in that case on
August 31, 1995. The United States is preparing a Reply for
filing on December 4, 1995.
3. The Department of State continues to present other
United States Government claims against Iran, in coordination
with concerned government agencies, and to respond to claims
brought against the United States by Iran, in coordination with
concerned government agencies.
In September 1995, the Departments of Justice and State
represented the United States in the first Tribunal hearing on
a government-to-government claim in 5 years. The Full Tribunal
heard arguments in Cases A/15(IV) and A/24. Case A/15(IV) is an
interpretive dispute in which Iran claims that the United
States has violated the Algiers Accords by its alleged failure
to terminate all litigation against Iran in U.S. courts. Case
A/24 involves a similar interpretive dispute in which,
specifically, Iran claims that the obligation of the United
States under the Accords to terminate litigation prohibits a
lawsuit against Iran by the McKesson Corporation from
proceeding in U.S. District Court for the District of Columbia.
The McKesson Corporation reactivated that litigation against
Iran in the United States following the Tribunal's negative
ruling on Foremost McKesson Incorporated's claim before the
Tribunal.
Also in September 1995, Iran filed briefs in two cases, to
which the United States is now preparing responses. In Case A/
11, Iran filed its Hearing Memorial and Evidence. In that case,
Iran has sued the United States for $10 billion, alleging that
the United States failed to fulfill its obligations under the
Accords to assist Iran in recovering the assets of the former
Shah of Iran. Iran alleges that the United States improperly
failed to (1) freeze the U.S. assets of the Shah's estate and
certain U.S. assets of close relatives of the Shah; (2) report
to Iran all known information about such assets; and (3)
otherwise assist Iran in such litigation.
In Case A/15(II:A), 3 years after the Tribunal's partial
award in the case, Iran filed briefs and evidence relating to
10 of Iran's claims against the United States Government for
nonmilitary property allegedly held by private companies in the
United States. Although Iran's submission was made in response
to a Tribunal order directing Iran to file its brief and
evidence ``concerning all remaining issues to be decided by
this Case,'' Iran's filing failed to address many claims in the
case.
In August 1995, the United States filed the second of two
parts of its consolidated submission on the merits in Case B/
61, addressing issues of liability and compensation. As
reported in my May 1995 Report, Case B/61 involves a claim by
Iran for compensation with respect to primarily military
equipment that Iran alleges it did not receive. The equipment
was purchased pursuant to commercial contracts with more than
50 private American companies. Iran alleges that it suffered
direct losses and consequential damages in excess of $2 billion
in total because of the United States Government's refusal to
allow the export of the equipment after January 19, 1981, in
alleged contravention of the Algiers Accords.
4. Since my last report, the Tribunal has issued two
important awards in favor of U.S. nationals considered dual
U.S.-Iranian nationals by the Tribunal. On July 7, 1995, the
Tribunal issued Award No. 565, awarding a claimant $1.1 million
plus interest for Iran's expropriation of the claimant's shares
in the Iranian architectural firm of Abdolaziz Farmafarmaian &
Associates. On July 14, 1995, the Tribunal issued Award No.
566, awarding two claimants $129,869 each, plus interest, as
compensation for Iran's taking of real property inherited by
the claimants from their father. Award No. 566 is significant
in that it is the Tribunal's first decision awarding dual
national claimants compensation for Iran's expropriation of
real property in Iran.
5. The situation reviewed above continues to implicate
important diplomatic, financial, and legal interests of the
United States and its nationals and presents an unusual
challenge to the national security and foreign policy of the
United States. The Iranian Assets Control Regulations issued
pursuant to Executive Order No. 12170 continue to play an
important role in structuring our relationship with Iran and in
enabling the United States to implement properly the Algiers
Accords. I shall continue to exercise the powers at my disposal
to deal with these problems and will continue to report
periodically to the Congress on significant developments.
William J. Clinton.
The White House, November 28, 1995.