[House Document 106-11]
[From the U.S. Government Publishing Office]






106th Congress, 1st Session - - - - - - - - - - - House Document 106-11


 
                         EXECUTIVE ORDER 13088

                               __________

                             COMMUNICATION

                                  FROM

                   THE PRESIDENT OF THE UNITED STATES

                              TRANSMITTING

  A REPORT ON THE NATIONAL EMERGENCY DECLARED BY EXECUTIVE ORDER NO. 
   13088 OF JUNE 9, 1998, IN RESPONSE TO THE THREAT TO THE NATIONAL 
  SECURITY AND FOREIGN POLICY OF THE UNITED STATES CONSTITUTED BY THE 
  ACTIONS AND POLICIES OF THE GOVERNMENTS OF THE FEDERAL REPUBLIC OF 
YUGOSLAVIA, AND THE REPUBLIC OF SERBIA WITH RESPECT TO KOSOVO, PURSUANT 
                          TO 50 U.S.C. 1703(c)





February 2, 1999.--Referred to the Committee on International Relations 
                       and ordered to be printed

                               --------

                    U.S. GOVERNMENT PRINTING OFFICE                    
69-011                     WASHINGTON : 1999




                                           The White House,
                                       Washington, January 5, 1999.
Hon. Newt Gingrich,
Speaker of the House of Representatives,
Washington, DC.
    Dear Mr. Speaker: On June 9, 1998, by Executive Order 13088 
(63 Fed. Reg. 32109, June 12, 1998), I declared a national 
emergency to deal with the unusual and extraordinary threat to 
the national security and foreign policy of the United States 
constituted by the actions and policies of the Governments of 
the Federal Republic of Yugoslavia (Serbia and Montenegro), and 
the Republic of Serbia with respect to Kosovo. The order blocks 
all property and interests in property of the Governments of 
the Federal Republic of Yugoslavia (Serbia and Montenegro), the 
Republic of Serbia and the Republic of Montenegro within the 
United States or within the possession or control of United 
States persons, and prohibits all new investment in the 
territory of the Republic of Serbia by United States persons, 
and the approval or other facilitation by United States persons 
of other persons' new investment in the territory of the 
Republic of Serbia.
    1. The declaration of the national emergency on June 9, 
1998, was made pursuant to the authority vested in me by the 
Constitution and laws of the United States, including the 
International Emergency Economic Powers Act (50 U.S.C. 1701 et 
seq.), the National Emergencies Act (50 U.S.C. 1601 et seq.), 
and section 301 of title 3 of the United States Code. The 
emergency declaration was reported by message to the Congress 
dated June 10, 1998, pursuant to section 204(b) of the 
International Emergency Economic Powers Act (50 U.S.C. 
1703(b)).
    The present report is submitted pursuant to 50 U.S.C. 
1641(c) and 1703(c) and covers the period from June 9 through 
December 8, 1998. It discusses only Administration actions and 
expenses directly related to the exercise of powers and 
authorities conferred by the declaration of a national 
emergency in Executive Order 13088.
    2. The Office of Foreign Assets Control (OFAC), acting 
under authority delegated by the Secretary of the Treasury, 
implemented the sanctions imposed under the foregoing statutes 
and Executive Order 13088 and has issued the Federal Republic 
of Yugoslavia (Serbia and Montenegro) Kosovo Sanctions 
Regulations, 31 CFR part 586 (the ``Regulations'') (63 Fed. 
Reg. 54575, October 13, 1998). A copy of the Regulations is 
attached to this report.
    The Regulations block all property and interests in 
property of the Governments of the Federal Republic of 
Yugoslavia (Serbia and Montenegro), the Republic of Serbia, and 
the Republic of Montenegro that are in the United States, that 
hereafter come within the United States, or that are or 
hereafter come within the possession or control of United 
States persons, including their overseas branches. The 
Regulations also prohibit financial transactions with, 
including trade financing for, the Governments of the Federal 
Republic of Yugoslavia (Serbia and Montenegro), the Republic of 
Serbia, and the Republic of Montenegro by United States 
persons. However, the Regulations provide an exemption, 
contained in section 2 of Executive Order 13088, for financial 
transactions, including trade financing, by United States 
persons within the territory of the Federal Republic of 
Yugoslavia (Serbia and Montenegro) that are (a) conducted 
exclusively through the domestic banking system within the 
Federal Republic of Yugoslavia (Serbia and Montenegro) in local 
currency (dinars), or (b) conducted using bank notes or barter.
    The Regulations also prohibit all new investment in the 
territory of the Republic of Serbia by United States persons, 
and the approval or other facilitation by United States persons 
of other persons' new investment in the territory of the 
Republic of Serbia. The term ``new investment,'' means (a) the 
acquisition of debt or equity interests in, (b) a commitment or 
contribution of funds or other assets to, or (c) a loan or 
other extension of credit to, a public or private undertaking, 
entity, or project, other than donations of funds to charitable 
organizations for purely humanitarian purposes. Any transaction 
by a United States person that evades or avoids, or that has 
the purpose of evading or avoiding, or attempts to violate, any 
of the prohibitions set forth in Executive Order 13088 is 
prohibited. Finally, the Regulations provide a general license, 
authorizing all transactions by United States persons involving 
property or interests in property of the Government of the 
Republic of Montenegro, except as provided pursuant to the 
Federal Republic of Yugoslavia (Serbia and Montenegro) and 
Bosnian Serb-Controlled Areas of the Republic of Bosnia and 
Herzegovina Sanctions Regulations, 31 CFR part 585.
    3. Since the issuance of Executive Order 13088 on June 9, 
1998, OFAC has issued 73 specific licenses, the majority of 
which (55) authorized financial transactions with respect to 
personal remittances by individuals to the territory of the 
Federal Republic of Yugoslavia (Serbia and Montenegro) and 
funding of humanitarian operations by nongovernmental 
organizations (NGOs) within the Federal Republic of 
Yugoslavia(Serbia and Montenegro). Other licenses authorized certain 
diplomatic transactions, transactions related to air safety issues and 
payment of overflight fees, the closure of Federal Republic of 
Yugoslavia (Serbia and Montenegro) entities formerly operating within 
the United States and the liquidation and maintenance of blocked 
tangible property, and intellectual property protection for U.S. firms 
operating in the Federal Republic of Yugoslavia (Serbia and 
Montenegro). OFAC also instituted a mechanism for NGOs to continue to 
support humanitarian operations in Yugoslavia and administers a 
registration program for NGOs to route money and supplies there as 
appropriate.
    Since June 9, 1998, U.S. banks and banks in the United 
States have reported to OFAC that they have blocked 877 
transactions totaling $20,361,767 pursuant to the sanctions. 
Most of the blockings were of funds transfers originating from, 
or destined for, Serbian banks.
    4. The expenses incurred by the Federal Government in the 
6-month period from June 9 through December 8, 1998, that are 
directly attributable to the declaration of a national 
emergency with respect to the Federal Republic of Yugoslavia 
(Serbia and Montenegro) and the Republic of Serbia in 
connection with the situation in Kosovo are estimated at 
approximately $715,000, most of which represents wage and 
salary costs for Federal personnel. Personnel costs were 
largely centered in the Department of the Treasury 
(particularly in OFAC and its Chief Counsel's Office), the 
Department of State, and the National Security Council.
    5. The situation reviewed above continues to present an 
extraordinary and unusual threat to the national security and 
foreign policy of the United States. The declaration of the 
national emergency with respect to the Federal Republic of 
Yugoslavia (Serbia and Montenegro) and the Republic of Serbia 
contained in Executive Order 13088 was made in reaction to the 
unacceptable actions and policies of the Belgrade authorities 
in Kosovo, and continues to apply. The current situation in 
Kosovo is fragile and, as yet, unresolved. It is of particular 
importance that developments in Kosovo should not disrupt 
progress in implementing the Dayton peace agreement. This 
threat to the peace of the region constitutes an unusual and 
extraordinary threat to the national security of the United 
States.
    With this in mind and in support of United Nations Security 
Council Resolutions 1099 and 1203, I shall continue to exercise 
the powers at my disposal with respect to the measures against 
the Government of the Federal Republic of Yugoslavia (Serbia 
and Montenegro), the Republic of Serbia, and the Republic of 
Montenegro, as long as these measures are appropriate, and will 
continue to report periodically to the Congress on significant 
developments pursuant to 50 U.S.C. 1703(c).

            Sincerely,
                                                William J. Clinton.




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