[House Document 105-229]
[From the U.S. Government Publishing Office]
105th Congress, 2d Session - - - - - - - - - - - - House Document 105-229
DEVELOPMENTS CONCERNING NATIONAL EMERGENCY WITH RESPECT TO IRAN
__________
MESSAGE
from
THE PRESIDENT OF THE UNITED STATES
TRANSMITTING
A REPORT ON DEVELOPMENTS CONCERNING THE NATIONAL EMERGENCY WITH RESPECT
TO IRAN THAT WAS DECLARED IN EXECUTIVE ORDER NO. 12957 OF MARCH 15,
1995, PURSUANT TO 50 U.S.C. 1703(c)
March 16, 1998.--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 concerning
the national emergency with respect to Iran that was declared
in Executive Order 12957 of March 15, 1995, and matters
relating to the measures in that order and in Executive Order
12959 of May 6, 1995, and in Executive Order 13059 of August
19, 1997. This report is submitted pursuant to section 204(c)
of the International Emergency Economic Powers Act, 50 U.S.C.
1703(c) (IEEPA), section 401(c) of the National Emergencies
Act, 50 U.S.C. 1641(c), and section 505(c) of the International
Security and Development Cooperation Act of 1985, 22 U.S.C.
2349aa-9(c). This report discusses only matters concerning the
national emergency with respect to Iran that was declared in
Executive Order 12957 and does not deal with those relating to
the emergency declared on November 14, 1979, in connection with
the hostage crisis.
1. On March 15, 1995, I issued Executive Order 12957 (60
Fed. Reg. 14615, March 17, 1995) to declare a national
emergency with respect to Iran pursuant to IEEPA, and to
prohibit the financing, management, or supervision by United
States persons of the development of Iranian petroleum
resources. This action was in response to actions and policies
of the Government of Iran, including support for international
terrorism, efforts to undermine the Middle East peace process,
and the acquisition of weapons of mass destruction and the
means to deliver them. A copy of the Order was provided to the
Speaker of the House and the President of the Senate by letter
dated March 15, 1995.
Following the imposition of these restrictions with regard
to the development of Iranian petroleum resources, Iran
continued to engage in activities that represent a threat to
the peace and security of all nations, including Iran's
continuing support for international terrorism, its support for
acts that undermine the Middle East peace process, and its
intensified efforts to acquire weapons of mass destruction. On
May 6, 1995, I issued Executive Order 12959 (60 Fed. Reg.
24757, May 9, 1995) to further respond to the Iranian threat to
the national security, foreign policy, and economy of the
United States. The terms of that order and an earlier order
imposing an import ban on Iranian-origin goods and services
(Executive Order 12613 of October 29, 1987) were consolidated
and clarified in Executive Order 13059 of August 19, 1997.
At the time of signing Executive Order 12959, I directed
the Secretary of the Treasury to authorize through specific
licensing certain transactions, including transactions by
United States persons related to the Iran-United States Claims
Tribunal in The Hague, established pursuant to the Algiers
Accords, and related to other international obligations and
U.S. Government functions, and transactions related to the
export of agricultural commodities pursuant to preexisting
contracts consistent with section 5712(c) of title 7, United
States Code. I also directed the Secretary of the Treasury, in
consultation with the Secretary of State, to consider
authorizing United States persons through specific licensing to
participate in market-based swaps of crude oil from the Caspian
Sea area for Iranian crude oil in support of energy projects in
Azerbaijan, Kazakhstan, and Turkmenistan.
Executive Order 12959 revoked sections 1 and 2 of Executive
Order 12613 of October 29, 1987, and sections 1 and 2 of
Executive Order 12957 of March 15, 1995, to the extent they are
inconsistent with it. A copy of Executive Order 12959 was
transmitted to the Congressional leadership by letter dated May
6, 1995.
2. On August 19, 1997, I issued Executive Order 13059 in
order to clarify the steps taken in Executive Order 12957 and
Executive Order 12959, to confirm that the embargo on Iran
prohibits all trade and investment activities by United States
persons, wherever located, and to consolidate in one order
thevarious prohibitions previously imposed to deal with the national
emergency declared on March 15, 1995. A copy of the Order was
transmitted to the Speaker of the House and the President of the Senate
by letter dated August 19, 1997.
The Order prohibits (1) the importation into the United
States of any goods or services of Iranian origin or owned or
controlled by the Government of Iran except information or
informational material; (2) the exportation, reexportation,
sale, or supply from the United States or by a United States
person, wherever located, of goods, technology, or services to
Iran or the Government of Iran, including knowing transfers to
a third country for direct or indirect supply, transshipment,
or reexportation to Iran or the Government of Iran, or
specifically for use in the production, commingling with, or
incorporation into goods, technology, or services to be
supplied, transshipped, or reexported exclusively or
predominantly to Iran or the Government of Iran; (3) knowing
reexportation from a third country to Iran or the Government of
Iran of certain controlled U.S.-origin goods, technology, or
services by a person other than a United States person; (4) the
purchase, sale, transport, swap, brokerage, approval,
financing, facilitation, guarantee, or other transactions or
dealings by United States persons, wherever located, related to
goods, technology, or services for exportation, reexportation,
sale or supply, directly or indirectly, to Iran or the
Government of Iran, or to goods or services of Iranian origin
or owned or controlled by the Government of Iran; (5) new
investment by United States persons in Iran or in property or
entities owned or controlled by the Government of Iran; (6)
approval, financing, facilitation, or guarantee by a United
States person of any transaction by a foreign person that a
United States person would be prohibited from performing under
the terms of the Order; and (7) any transaction that evades,
avoids, or attempts to violate a prohibition under the Order.
Executive Order 13059 became effective at 12:01 a.m.,
eastern daylight time on August 20, 1997. Because the Order
consolidated and clarified the provisions of prior orders,
Executive Order 12613 and paragraphs (a), (b), (c), (d), and
(f) of section 1 of Executive Order 12959 were revoked by
Executive Order 13059. The revocation of corresponding
provisions in the prior Executive Orders did not affect the
applicability of those provisions, or of regulations, licenses
or other administrative actions taken pursuant to those
provisions, with respect to any transaction or violation
occurring before the effective date of Executive order 13059.
Specific licenses issued pursuant to prior Executive orders
continue in effect, unless revoked or amended by the Secretary
of the Treasury. General licenses, regulations, orders, and
directives issued pursuant to prior orders continue in effect,
except to the extent inconsistent with Executive Order 13059 or
otherwise revoked or modified by the Secretary of the Treasury.
The declaration of national emergency made by Executive
Order 12957, and renewed each year since, remains in effect and
is not affected by the Order.
3. On March 4, 1998, I renewed for another year the
national emergency with respect to Iran pursuant to IEEPA. This
renewal extended the authority for the current comprehensive
trade embargo against Iran in effect since May 1995. Under
these sanctions, virtually all trade with Iran is prohibited
except for trade in information and informational materials and
certain other limited exceptions.
4. There have been no amendments to the Iranian
Transactions Regulations, 31 C.F.R. Part 560 (the ``ITR''),
since my report of September 17, 1997.
5. During the current 6-month period, the Department of the
Treasury's Office of Foreign Assets Control (OFAC) made
numerous decisions with respect to applications for licenses to
engage in transactions under the ITR, and issuedseven licenses.
The majority of denials were in response to requests to authorize
commercial exports to Iran--particularly of machinery and equipment for
various industries--and the importation of Iranian-origin goods. The
licenses issued authorized certain financial transactions, transactions
relating to air safety policy, and to disposal of U.S.-owned goods
located in Iran. Pursuant to sections 3 and 4 of Executive Order 12959
and consistent with the Iran-Iraq Arms Non-Proliferation Act of 1992
and other statutory restrictions concerning certain goods and
technology, including those involved in air-safety cases, the
Department of the Treasury continues to consult with the Departments of
State and Commerce on these matters.
The U.S. financial community continues to scrutinize
transactions associated with Iran and to consult with OFAC
about their appropriate handling. Many of these inquiries have
resulted in investigations into the activities of U.S. parties
and, where appropriate, the initiation of enforcement action.
6. The U.S. Customs Service has continued to effect
numerous seizures of Iranian-origin merchandise, primarily
carpets, for violation of the import prohibitions of the ITR.
Various enforcement actions carried over from previous
reporting periods are continuing and new reports of violations
are being aggressively pursued. Since my last report, OFAC has
collected six civil monetary penalties totaling nearly $84,000
for violations of IEEPA and the ITR.
7. The expenses incurred by the Federal Government in the
6-month period from September 15, 1997, through March 14, 1998,
that are directly attributable to the exercise of powers and
authorities conferred by the declaration of a national
emergency with respect to Iran are reported to be approximately
$1.3 million, most of which represent wage and salary costs for
Federal personnel. Personnel costs were largely centered in the
Department of the Treasury (particularly in the Office of
Foreign Assets Control, the U.S. Customs Service, the Office of
the Under Secretary for Enforcement, and the Office of the
General Counsel), the Department of State (particularly the
Bureau of Economic and Business Affairs, the Bureau of Near
Eastern Affairs, the Bureau of Intelligence and Research, and
the Office of the Legal Adviser), and the Department of
Commerce (the Bureau of Export Administration and the General
Counsel's Office).
8. The situation reviewed above continues to present an
extraordinary and unusual threat to the national security,
foreign policy, and economy of the United States. The
declaration of the national emergency with respect to Iran
contained in Executive Order 12957 and the comprehensive
economic sanctions imposed by Executive Order 12959 underscore
the United States Government's opposition to the actions and
policies of the Government of Iran, particularly its support of
international terrorism and its efforts to acquire weapons of
mass destruction and the means to deliver them. The Iranian
Transactions Regulations issued pursuant to Executive Orders
12957, 12959, and 13059 continue to advance important
objectives in promoting the nonproliferation and anti-terrorism
policies of the United States. I shall exercise the powers at
my disposal to deal with these problems and will report
periodically to the Congress on significant developments.
William J. Clinton.
The White House, March 16, 1998.