[Congressional Record Volume 140, Number 141 (Monday, October 3, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 TERMINATION OF THE BLOCKING OF PANAMANIAN GOVERNMENT ASSETS--MESSAGE 
                       FROM THE PRESIDENT--PM 150

  The PRESIDING OFFICER laid before the Senate the following message 
from the President of the United States, together with accompanying 
papers; which were referred to the Committee on Banking, Housing, and 
Urban Affairs:

To the Congress of the United States:
  1. I hereby report to the Congress on developments since the last 
Presidential report on November 9, 1993, which have resulted in the 
termination of the continued blocking of Panamanian government assets. 
This is the final report with respect to Panama pursuant to section 
207(d) of the International Emergency Economic Powers Act, 50 U.S.C. 
1706(d).
  2. On April 5, 1990, President Bush issued Executive Order No. 12710, 
terminating the national emergency declared on April 8, 1988, with 
respect to Panama. While this order terminated the sanctions imposed 
pursuant to that declaration, the blocking of Panamanian government 
assets in the United States was continued in order to permit completion 
of the orderly unblocking and transfer of funds that the President 
directed on December 20, 1989, and to foster the resolution of claims 
of U.S. creditors involving Panama, pursuant to 50 U.S.C. 1706(a). The 
termination of the national emergency did not affect the continuation 
of compliance audits and enforcement actions with respect to activities 
taking place during the sanctions period, pursuant to 50 U.S.C. 
1622(a).
  3. The Panamanian Transactions Regulations, 31 CFR Part 565 (the 
``Regulations''), were amended effective May 9, 1994, to foster the 
resolution of U.S. persons' claims against the Government of Panama 
arising prior to the April 5, 1990, termination date. (59 Federal 
Register 24643, May 12, 1994.) A copy of the amendment is attached. The 
amendment, new section 565.512, includes a statement of licensing 
policy indicating that the Department of the Treasury's Office of 
Foreign Assets Control (``FAC'') would issue specific licenses 
authorizing the release of blocked Government of Panama funds at the 
request of that government to satisfy settlements, final judgments, and 
arbitral awards with respect to claims of U.S. persons arising prior to 
April 5, 1990. In addition, FAC stated that it would accept license 
applications from U.S. persons seeking judicial orders of attachment 
against blocked Government of Panama assets in satisfaction of final 
judgments entered against the Government of Panama, provided such 
applications are submitted no later than June 15, 1994.
  4. No applications were received pursuant to this amendment for the 
purpose of obtaining judicial orders of attachment against blocked 
Government of Panama assets. Since the last report, however, specific 
licenses were issued at the request of the Government of Panama to 
unblock about $4.4 million to satisfy settlements reached with the vast 
majority of U.S. creditors by the Government of Panama. On September 9, 
1994, the FAC gave notice to the public that the remaining blocked 
Government of Panama assets, approximately $2.1 million, would be 
unblocked effective September 16, 1994. (50 Federal Register 46720, 
September 9, 1994.) A copy of the notice is attached. Half of the $2.1 
million had been held at the Federal Reserve Bank of New York at the 
request of the Government of Panama. The remaining amounts were held in 
blocked commercial bank accounts or in blocked reserved accounts 
established under section 565.509 of the Panamanian Transactions 
Regulations, 31 CFR 565.509. The remaining known claimants were 
informed that, prior to the unblocking, the Government of Panama and 
Air Panama had directed the transfer of $400,000 into a trust account 
administered by counsel to the Republic of Panama and Air Panama, as 
escrow agent, to be utilized toward resolution of the few remaining 
U.S. claims. This sum exceeds the face amount of the total of the known 
remaining claims.
  5. With the unblocking on September 16, 1994, of Government of Panama 
funds that had been subject to the continued blocking, the sanctions 
program initiated to deal with the threat once posed by the Noriega 
regime in Panama is completed. However, enforcement action for past 
violations may still be pursued within the applicable statute of 
limitations.
  6. The expenses incurred by the Federal Government during the period 
of the national emergency with respect to Panama from April 8, 1988, 
through April 5, 1990, that are directly attributable to the exercise 
of powers and authorities conferred by the declaration of a national 
emergency with respect to Panama are estimated to total about $2.225 
million, most of which represents 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), and the Department 
of State (particularly the Bureau of Economic and Business Affairs and 
the Office of the Legal Adviser).
                                                  William J. Clinton.  
  The White House, October 3, 1994.

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