[House Report 106-154]
[From the U.S. Government Publishing Office]



106th Congress                                            Rept. 106-154
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================



 
              SELECTIVE AGRICULTURAL EMBARGOES ACT OF 1999

                                _______
                                

                  May 20, 1999.--Ordered to be printed

                                _______


Mr. Combest, from the Committee on Agriculture, submitted the following

                              R E P O R T

                         [To accompany H.R. 17]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Agriculture, to whom was referred the bill 
(H.R. 17) to amend the Agricultural Trade Act of 1978 to 
require the President to report to Congress on any selective 
embargo on agricultural commodities, to provide a termination 
date for the embargo, to provide greater assurances for 
contract sanctity, and for other purposes, having considered 
the same, report favorably thereon without amendment and 
recommend that the bill do pass.

                           Brief Explanation

    H.R. 17, the Selective Agricultural Embargoes Act of 1999, 
requires the President to report to Congress on any selective 
embargo on agricultural commodities and specifies the period 
during which the embargo will be in effect.

                            Purpose and Need

    For American farmers and ranchers, trade is an essential 
part of their livelihood. Exports account for 30% of U.S. farm 
cash receipts and nearly 40% of all agricultural production is 
exported. U.S. farmers and ranchers produce much more than is 
consumed in the United States, therefore exports are vital to 
the prosperity and success of U.S. farmers and ranchers. The 
future holds great promise for agriculture exports as world 
income and economic growth expand. Higher incomes for consumers 
mean improved and diverse diets, which, in turn, result in a 
greater demand for high value agricultural products.
    In order to continue to meet the worldwide demand for U.S. 
agricultural products, farmers and ranchers must continually 
assess the world market to determine where those markets are 
for specific agricultural products. It has become increasingly 
difficult to make this assessment because farmers and ranchers 
are denied access to certain world markets due to economic 
sanctions and embargoes, among other reasons.
    A June 1997, report entitled ``Unilateral Economic 
Sanctions'', prepared by the President's Export Council, 
details what is described as a complex and growing web of 
restrictions and legal impediments in the international trading 
system that extends well beyond the intent of the individual 
measures. The Export Council's report describes more than 75 
countries, from Angola to Zaire, that are subject to, or under 
the threat of, one or more of some 21 specific sanctions. The 
report estimates the impact of all sanctions, including 
foregone sales and business relationships, at $15 billion to 
$19 billion, which corresponds to 200,000 to 250,000 export-
related jobs in 1995.
    For U.S. agriculture, embargoes or sanctions, whether 
imposed by the Administration or by law, often have unintended 
consequences that can fall unfairly on U.S. farmers and 
ranchers. U.S. agriculture remembers the 1980 Soviet grain 
embargo. The one lasting impression left of that embargo is 
that the U.S. could not be considered to be a reliable supplier 
of wheat. The past 19 years have been spent attempting to 
reverse that opinion.
    Iran and Iraq used to be $5.5 billion markets for 
agriculture products, with the U.S. as a major supplier. 
Currently, no U.S. agriculture exports go to Iran and in 1997, 
exports to Iraq were $50 million--2% of that country's 
agriculture imports.
    Therefore because of the importance of assuring the 
reliability of the U.S. as a supplier of food and agricultural 
products, the Committee determined legislation was needed to 
address the effects of embargoes and sanctions on U.S. 
agriculture.

Selective embargoes

    This bill amends the Agricultural Trade Act of 1978 to 
require that, if the President acts to implement an embargo of 
any agricultural commodity to any country, the President must 
submit a report to Congress, within 5 days of imposing the 
embargo, that describes the reasons for the embargo and the 
period of time the embargo will be in effect. This requirement 
is applicable when there is an embargo of agriculture 
commodities to a country and that embargo does not include all 
exports to that country.
    H.R. 17 also provides that if within 100 days of receiving 
the President's report, a joint resolution is enacted that 
approves the embargo, the embargo will end on the date 
determined by the President or 1 year after the date of 
enactment of the joint resolution, whichever is earlier. If a 
joint resolution disapproving the embargo is enacted during 
that 100-day period, the embargo will terminate at the end of 
that 100-day period.
    The bill includes an exception providing that an embargo 
may take effect during any period in which there is a state of 
war declared by Congress or a national emergency declared by 
the President.

Contract sanctity

    The bill also clarifies that ``plant nutrient materials'' 
are to be included in the category of agricultural commodities 
in the section of the Agricultural Trade Act of 1978, regarding 
contract sanctity. Therefore the protection afforded 
agricultural commodities in regard to suspension of trade and 
contract sanctity will be applied to plant nutrient materials.
    Plant nutrient materials under export sales contracts will 
be protected from suspension of trade, as long as the contract 
is entered into before the suspension of trade is announced and 
the contract terms require delivery within 270 days after 
suspension of trade is imposed.

                           Section-by-Section


Sec. 1. Short title

    This Act may be cited as the ``Selective Agricultural 
Embargoes Act of 1999.''

Sec. 2. Reporting on selective embargoes

    This section amends the Agricultural Trade Act of 1978 by 
adding a new section at the end of title VI. It contains the 
following provisions:
    (a) Report.--The President is required to report to 
Congress within 5 days of taking any action to embargo the 
export of any agricultural commodity which is under an export 
sales contract, if such embargo is not part of an embargo of 
all exports to that country.
    (b) Approval of Embargo.--If within 100 days of receiving 
the President's report a Joint Resolution approving the embargo 
is enacted into law, the embargo shall terminate on the earlier 
of a date chosen by the President, or one year after enactment 
of the Joint Resolution.
    (c) Disapproval of Embargo.--If, on the other hand, within 
100 days of receiving the President's report a Joint Resolution 
disapproving the embargo is enacted into law, the embargo shall 
terminate automatically at the end of that 100 day period.
    (d) Exception.--This section contains the exception that an 
embargo may take effect during any period in which the United 
States is in a state of war declared by Congress or during a 
national emergency as declared by the President.
    (e) Definitions.--This section clarifies that the term 
``agricultural commodity'' includes plant nutrient materials. 
It defines ``under an export sales contract'' to mean any 
export sales contract entered into prior to the time the 
President transmits notice of the proposed embargo to the 
Congress, and ``embargo'' to mean ``any prohibition or 
curtailment.''

Sec. 3. Addition of plant nutrient materials to protection of contract 
        sanctity

    Generally, section 602(c) of the Agricultural Trade Act of 
1978 prevents the President from nullifying export sales 
contracts which are entered into prior to the time the 
President takes any action which would prohibit or curtail the 
export of an agricultural commodity. This section amends 
section 602(c) to clarify that plant nutrient materials are 
included within the definition of ``agricultural commodity'' 
for purposes of receiving this same protection.

                        Committee Consideration

    The Committee on Agriculture met, pursuant to notice and 
with a quorum present, on February 10, 1999, to consider H.R. 
17 and other pending business. Chairman Combest recognized Mr. 
Ewing, Chairman of the Subcommittee on Risk Management, 
Research, and Specialty Crops, who is also the author of the 
bill for an explanation.
    Mr. Ewing provided a brief explanation of the bill and 
asked unanimous consent that a letter in support of H.R. 17 
signed by over 30 agricultural associations and businesses 
representing a broad sector of the U.S. agricultural community, 
be inserted into the record (see Appendix II). Without 
objection, it was ordered.
    Mr. Stenholm was then recognized and expressed his support 
for the bill.
    After a brief discussion on the bill, Mr. Stenholm moved 
that the bill, H.R. 17, be adopted and favorably reported to 
the House with a recommendation that it do pass. Mr. Stenholm's 
motion was agreed to by a voice vote of the Committee with a 
majority quorum being present.

                   Reporting the Bill--Rollcall Votes

    In compliance with clause 3(b) of rule XIII of the House of 
Representatives, H.R. 17 was reported by voice vote with a 
majority quorum present. There was no request for a recorded 
vote.

           Budget Act Compliance (Sections 308, 402, and 423)

    The provisions of clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives and section 308(a)(1) of the 
Congressional Budget Act of 1974 (relating to estimates of new 
budget authority, new spending authority, new credit authority, 
or increased or decreased revenues or tax expenditures) are not 
considered applicable. The estimate and comparison required to 
be prepared by the Director of the Congressional Budget Office 
under clause 3(c)(3) of rule XIII of the Rules of the House of 
Representatives and sections 402 and 423 of the Congressional 
Budget Act of 1974 submitted to the Committee prior to the 
filing of this report are as follows:

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, February 19, 1999.
Hon. Larry Combest,
Chairman, Committee on Agriculture,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 17, the Selective 
Agricultural Embargoes Act of 1999.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Craig Jagger.
            Sincerely,
                                          Dan L. Crippen, Director.
    Enclosure.

               congressional budget office cost estimate

H.R. 17--Selective Agricultural Embargoes Act of 1999

    H.R. 17 would establish procedures for the Congress to 
approve or disapprove agricultural embargoes imposed by the 
President that are in part of an embargo on all exports to a 
particular country or countries. The President would be 
required to report such embargoes to the Congress. Except in 
cases of war or national emergency, H.R. 17 would require that 
an embargo be terminated within a year after the Congress 
approves it or within 100 days of the report if the Congress 
disapproves it. The bill also would apply certain contract 
sanctity requirements that are already in effect for 
agricultural commodities to plant nutrient materials.
    If new embargoes are imposed, the bill could affect direct 
spending because embargoes might end and programs to guarantee 
export loans might resume earlier than under current law. 
However, CBO has no basis for estimating the potential 
budgetary impact of these provisions because we cannot predict 
the likelihood or extent of future embargoes.
    Because the bill could affect direct spending, pay-as-you-
go procedures would apply. H.R. 17 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act and would not affect the budgets 
of state, local, or tribal governments.
    The CBO contact for this estimate is Crag Jagger. This 
estimate was approved by Robert A. Sunshine, Deputy Assistant 
Director for Budget Analysis.

                        Committee Cost Estimate

    Pursuant to clause 3(d)(2) of rule XIII of the Rules of the 
House of Representatives, the Committee report incorporates the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to sections 402 and 423 of the 
Congressional Budget Act of 1974.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds the 
Constitutional authority for this legislation in Article I, 
clause 8, section 18, that grants Congress the power to make 
all laws necessary and proper for carrying out the powers 
vested by Congress in the Government of the United States or in 
any department or officer thereof.

                          Oversight Statement

    No summary of oversight findings and recommendations made 
by the Committee on Government Reform, as provided for in 
clause 3(c)(4) of rule XIII of the Rules of the House of 
Representatives, was available to the Committee with reference 
to the subject matter specifically addressed by H.R. 17.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee on Agriculture's 
oversight findings and recommendations are reflected in the 
body of this report.

                      Advisory Committee Statement

    No advisory committee within the meaning of section 5(b) of 
the Federal Advisory Committee Act was created by this 
legislation.

                Applicability to the Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (Public Law 
104-1).

                       Federal Mandates Statement

    The Committee adopted as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act (Public Law 104-4).

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

             TITLE VI OF THE AGRICULTURAL TRADE ACT OF 1978


                        TITLE VI--REPORTS

           *       *       *       *       *       *       *


SEC. 602. EXPORT REPORTING AND CONTRACT SANCTITY.

  (a) * * *

           *       *       *       *       *       *       *

  (c) Contract Sanctity.--Notwithstanding any other provision 
of law, the President shall not prohibit or curtail the export 
of any agricultural commodity (including plant nutrient 
materials) under an export sales contract--
          (1) that is entered into before the President 
        announces an action that would otherwise prohibit or 
        curtail the export of the commodity, and
          (2) the terms of which require delivery of the 
        commodity within 270 days after the date of the 
        suspension of trade is imposed,
except that the President may prohibit or curtail the export of 
any agricultural commodity (including plant nutrient materials) 
during a period for which the President has declared a national 
emergency or for which the Congress has declared war.

           *       *       *       *       *       *       *


SEC. 604. REPORTING ON SELECTIVE EMBARGOES.

  (a) Report.--If the President takes any action, pursuant to 
statutory authority, to embargo the export under an export 
sales contract (as defined in subsection (e)) of an 
agricultural commodity to a country that is not part of an 
embargo on all exports to the country, not later than 5 days 
after imposing the embargo, the President shall submit a report 
to Congress that sets forth in detail the reasons for the 
embargo and specifies the proposed period during which the 
embargo will be effective.
  (b) Approval of Embargo.--If a joint resolution approving the 
embargo becomes law during the 100-day period beginning on the 
date of receipt of the report provided for in subsection (a), 
the embargo shall terminate on the earlier of--
          (1) a date determined by the President; or
          (2) the date that is 1 year after the date of 
        enactment of the joint resolution approving the 
        embargo.
  (c) Disapproval of Embargo.--If a joint resolution 
disapproving the embargo becomes law during the 100-day period 
referred to in subsection (b), the embargo shall terminate on 
the expiration of the 100-day period.
  (d) Exception.--Notwithstanding any other provision of this 
section, an embargo may take effect and continue in effect 
during any period in which the United States is in a state of 
war declared by Congress or national emergency, requiring such 
action, declared by the President.
  (e) Definitions.--As used in this section--
          (1) the term ``agricultural commodity'' includes 
        plant nutrient materials;
          (2) the term ``under an export sales contract'' means 
        under an export sales contract entered into before the 
        President has transmitted to Congress notice of the 
        proposed embargo; and
          (3) the term ``embargo'' includes any prohibition or 
        curtailment.

                               APPENDIX I

                              ----------                              

                    Congressional Research Service,
                                       Library of Congress,
                                 Washington, DC, February 17, 1999.

                               Memorandum

To: House Committee on Agriculture, Attention: Andy Baker.
From: Jeanne J. Grimmett, Legislative Attorney, American Law Division.
Subject: Possible Effect of H.R. 17, 106th Cong., 1st Sess. (1999), Had 
        Its Provisions Been in Force as of January 1, 1979.

    This memorandum responds to your request for an 
identification of Presidential actions to which the proposed 
Selective Agricultural Embargoes Act of 1999, H.R. 17, 106th 
Cong., 1st Sess. (1999), as ordered reported, would have 
applied if its provisions had been in effect as of January 1, 
1979. Listed below are examples of trade embargoes that would 
seemingly have fallen within the scope of the bill. This 
memorandum addresses only the potential application of the 
bill's provisions to the embargoes listed and does not address 
whether and, if so, the extent to which, any of the listed 
embargoes affected actual export sales contracts, as defined by 
the bill.
    H.R. 17, the Selective Agricultural Embargoes Act of 1999, 
would add a new section to the Agricultural Trade Act of 1978, 
7 U.S.C. Sec. Sec. 5711 et seq., requiring the President to 
report to Congress if he ``takes any action, pursuant to 
statutory authority, to embargo the export under an export 
sales contract * * * of an agricultural commodity to a country 
that is not part of an embargo on all exports to the country.'' 
The President must so report within 5 days of imposing the 
embargo.\1\ The phrase ``under an export sales contract'' is 
defined as ``under an export sales contract entered into before 
the President has transmitted to Congress notice of the 
proposed embargo.'' \2\ The term ``embargo'' is defined to 
include ``any prohibition or curtailment'' \3\ and we assume 
for purposes of this memorandum that this definition applies to 
the term whether it is used as a noun or a verb. The term 
``agricultural commodity'' expressly encompasses ``plant 
nutrient materials.'' \4\ The bill also provides for the 
legislative approval and disapproval of such an embargo, 
providing a date on which the embargo will terminate depending 
on the nature of the congressional response.\5\ The bill 
additionally states that, notwithstanding any other provision 
of the new section, ``an embargo may take effect and continue 
in effect during any period in which the United States is in a 
state of war declared by the Congress or national emergency, 
requiring such action, declared by the President.'' \6\ We are 
assuming that the bill contemplates that any export 
restrictions or prohibitions that the President imposes under 
statutory authority may take effect on the date that the 
President announces them or on another date that he prescribes.
---------------------------------------------------------------------------
    \1\ H.R. 17, Sec. 2, adding Agricultural Trade Act of 1978, 
Sec. 604(a).
    \2\ H.R. 17, Sec. 2, adding Agricultural Trade Act of 1978, 
Sec. 604(e)(2).
    \3\ H.R. 17, Sec. 2, adding Agricultural Trade Act of 1978, 
Sec. 604(e)(1), (3).
    \4\ H.R. 17, Sec. 2, adding Agricultural Trade Act of 1978, 
Sec. 604(e)(2).
    \5\ H.R. 17, Sec. 2, adding Agricultural Trade Act of 1978, 
Sec. 604(b)-(c).
    \6\ H.R. 17, Sec. 2, adding Agricultural Trade Act of 1978, 
Sec. 604(d).
---------------------------------------------------------------------------
    Given the above-described language, the reporting, approval 
and disapproval provisions of the bill would seemingly apply to 
any action by the President that: (1) does not involve a 
prohibition or curtailment of the export of all goods to a 
given country, and (2) prohibits or curtails exports of 
agricultural commodities under export sales contracts entered 
into before the President has submitted the required notice to 
Congress. For purposes of the examples given below, we are 
assuming that the President would not have made his 
communication to Congress until up to 5 days after taking 
action to impose the embargo.
    The breadth of meaning of the term ``embargo''--namely, 
``any prohibition or curtailment''--may also possibly cover 
presidentially mandated prohibitions or restrictions on loans, 
credits, and credit guarantees for agricultural exports, 
whether granted by the federal government or private 
institutions. While such prohibitions would not directly 
``prohibit or curtail'' agricultural exports, they indirectly 
may have this effect. Moreover, a prospective loan or credit 
restriction may have a retroactive effect, as the inability to 
obtain financing could in some cases make it less likely that 
the actual export of goods will take place under an export 
sales contract entered into before the effective date of the 
presidential action involved. A number of questions may be 
raised, however, by the inclusion of export financing within 
the scope of the bill. For example, would a prohibition on 
export financing of all goods destined for a given country be 
considered ``an embargo on all exports'' if there is no 
accompanying prohibition on the actual export of goods to that 
country? Alternatively, if there is a prohibition on the export 
of goods to a country, would the bill apply if the export 
prohibition is selective but the financing provision is 
comprehensive? If the bill is to be read in a broad manner, it 
would seemingly have applied, for example, to the mandatory 
application by the President of prospective nuclear sanctions 
against India and Pakistan under Sec. 102(b) of the Arms Export 
Control Act, 22 U.S.C. Sec. 2799aa-1(b), following the 
detonation of nuclear devices by each of these countries in May 
1998. The President was required to impose a ban on certain 
exports to India and Pakistan as well as to prohibit government 
financing of exports of all commodities, with the exception of 
certain intelligence-related transactions and humanitarian 
assistance. Because the United States did not ban all exports 
to India and Pakistan, any ``curtailment'' of agricultural 
exports under existing sales contracts resulting from 
prospective financing prohibitions would not have been part of 
an embargo of all goods to these countries.
    It should be noted that in the 1980's, Congress placed 
restrictions on the authority of the Executive Branch to impose 
export controls on agricultural products and provided 
protections for domestic parties who were affected by 
embargoes. In 1981, Congress required that the farmers be 
compensated for the effects of an agricultural embargo under 
certain conditions.\7\ In addition, a contract sanctity 
provision, enacted in the Futures Trading Act of 1982 and 
currently codified at 7 U.S.C. Sec. 5712(c), prohibits the 
President from prohibiting or curtailing the export of any 
agricultural commodity under an export sales contract (1) that 
is entered into before the President announces an action that 
would otherwise prohibit or curtail the export of the 
commodity, and (2) the terms of which require delivery of the 
commodity within 270 days after the date the suspension of 
trade is imposed, except that the President may so restrict the 
export of any agricultural commodity during a period for which 
he has declared a national emergency or for which Congress has 
declared war. In addition, the Export Administration Act of 
1979, which delegated to the President the authority to control 
exports for reasons of national security, foreign policy, and 
short supply, was amended in 1985 to prohibit the use of the 
Act's national security authorities to impose export controls 
on ``agricultural commodities, including fats, oils, and animal 
hides and skins.'' \8\ Congress also added a contract sanctity 
requirement to the Act's foreign policy control provision and 
placed other restrictions on the use of EAA authorities to 
place export controls on agricultural commodities for foreign 
policy reasons.\9\ The EAA expired in 1994 and its authorities 
are currently carried forward pursuant to the International 
Emergency Economic Powers Act, discussed below.
---------------------------------------------------------------------------
    \7\ Agricultural and Food Act of 1981, Pub. L. No. 97-98, 
Sec. 1204, 7 U.S.C. Sec. 1736j, currently codified at 7 U.S.C. 
Sec. 5672.
    \8\ Export Administration Amendments Act of 1985 (EAAA), Pub. L. 
No. 99-64, Sec. 105(j), adding Export Administration Act of 1979 (EAA), 
Sec. 5(q), 50 U.S.C. App. Sec. 2404(q).
    \9\ EAAA, Sec. 108, adding or amending EAA, Sec. Sec. 6(g), (m), 50 
U.S.C. App. Sec. Sec. 2405(g), (m); EAAA, Sec. 109(d), amending EAA, 
Sec. 7(g)(3), 50 U.S.C. App. Sec. Sec. 2406(g)(3). Section 6(m) of the 
EAA, providing for contract sanctity, was eventually redesignated 
Sec. 6(p) and codified at 50 U.S.C. App. Sec. 2405(p).
---------------------------------------------------------------------------
    Most of the export restrictions described below have been 
imposed by the President under the International Emergency 
Economic Powers Act (IEEPA), 50 U.S.C. Sec. Sec. 1701 et seq., 
which delegates to the President broad authority to prohibit 
and regulate exports and other economic transactions having a 
foreign component, conditioned on the President's first 
declaring a national emergency. The Act prohibits the President 
from using IEEPA authority to regulate or prohibit donations of 
articles, such as food, clothing, and medicine, intended to be 
used to relieve human suffering, except to the extent that he 
determines that: (1) such donations would seriously impair his 
ability to deal with the underlying national emergency; (2) the 
donations are in response to coercion against the proposed 
recipient or donor; or (3) the donations would endanger U.S. 
Armed Forces engaged in (or about to be engaged in) 
hostilities.\10\ Because the President has discretion under 
this provision to prohibit the donations described, we will 
treat any exclusion of such donations as a situation that does 
not involve ``an embargo on all exports'' to a given country.
---------------------------------------------------------------------------
    \10\ International Emergency Economic Powers Act (IEEPA), 
Sec. 203(b)(2), 50 U.S.C. Sec. 1702 (b)(2). Section 203(b) also 
prohibits the use of IEEPA authorities to regulate or prohibit personal 
communications that do not involve a transfer of anything of value, the 
importation or exportation of certain informational materials, and 
transactions ordinarily incident to travel. IEEPA, Sec. 203(b), 50 
U.S.C. Sec. 1702(b).
---------------------------------------------------------------------------
    Listed below are embargoes to which H.R. 17 seemingly would 
have applied if it had been in effect as of January 1, 1979. 
Each of these embargoes appears to contain each of the three 
elements required by the statute: (1) inclusion of agricultural 
commodities; (2) selectivity (certain exports excluded from a 
broad prohibition or otherwise not initially covered); and (3) 
some degree of retroactivity (e.g., exporters may have entered 
into export sales contracts but may not have obtained export 
licenses by 5 days after the date the embargo was announced, or 
existing contracts may be performed but only until a given 
date).
    Soviet grain embargo (1980).--In response to the Soviet 
Union's invasion of Afghanistan in late December 1979, 
President Carter, on January 7, 1980, invoked his authority 
under the Export Administration Act of 1979 to control exports 
for reasons of national security and foreign policy to direct 
the Secretary of Commerce to terminate all grain shipments to 
the Soviet Union in excess of the 8 million tons per year that 
the United States was committed to sell under its 5-year grain 
agreement with the U.S.S.R., and to terminate the export of 
other agricultural commodities as well.\11\
---------------------------------------------------------------------------
    \11\ 16 Weekly Comp. Pres. Docs 32 (1980); 45 Fed.. Reg. 1883 
(1980); 45 Fed. Reg. 8289 (1980). On January 16, 1980, the Commerce 
Department, at the direction of the President, suspended all 
outstanding export licenses and other specific authorizations issued to 
date for shipments to the Soviet Union, pending a U.S. licensing policy 
``in light of the Soviet intervention in Afghanistan and changed 
national security circumstances.'' 45 Fed. Reg. 3027-28 (1980). The 
Department also provided notice that, except for licenses for certain 
agricultural commodities and products that could be exported pursuant 
to the President's earlier order and licensing requirements issued 
pursuant to that order (see 45 Fed.. Reg. 1883), no new licenses or 
other authorizations for export to the U.S.S.R. would be issued by the 
Department pending the announced review. 45 Fed.. Reg. at 3027-28.
---------------------------------------------------------------------------
    Nicaragua embargo (1985).--In response to activities of the 
Nicaraguan Government, President Reagan on May 1, 1985, invoked 
his authorities under the IEEPA to impose a trade embargo on 
Nicaragua effective May 7, 1985.\12\ The embargo included a 
prohibition on ``all exports from the United States of goods to 
or destined for Nicaragua, except those destined for the 
organized democratic resistance.'' Regulations issued by the 
Office of Foreign Assets Control (OFAC) provided that there 
would be a prohibition on all exports from the United States to 
Nicaragua, except for exports destined for the organized 
democratic resistance; donated articles such as food, clothing 
and medicine intended to be used to relieve human suffering; 
commercial exports of medicines and supplies intended strictly 
for medical purposes; exports of goods for humanitarian, 
educational, or religious purposes (to be considered on a case-
by-case basis) and certain other items under enumerated general 
license provisions of the Commerce Department.\13\
---------------------------------------------------------------------------
    \12\ Executive Order 12513, 21 Weekly Comp. Pres. Docs. 566-67 
(1985).
    \13\ 50 Fed.. Reg. 19890 (1985).
---------------------------------------------------------------------------
    OFAC regulations allowed the export of goods in transit 
before the effective date of the embargo and stated that 
specific licenses would normally be granted for the export of 
goods from the United States after the effective date and 
before November 1, 1985, provided the exporter demonstrated 
that it had a legal obligation to export the goods to Nicaragua 
under a contract entered into prior to May 1, 1985, and either 
that (1) the exporter's obligation was guaranteed under an 
outstanding performance bond which could be successfully 
invoked by the Nicaraguan importer, or (2) the exporter was 
unable to sell the goods to any other purchaser without 
incurring a loss.\14\ Because the embargo seemingly would have 
covered any agricultural goods subject to an export sales 
contract entered into between the date of the President's order 
and 5 days thereafter and, moreover, because agricultural goods 
to be exported pursuant to an export sales contract entered 
into before the end of that 5-day period could not be provided 
after November 1, 1985, the bill would appear to have potential 
applicability to this action of the President.
---------------------------------------------------------------------------
    \14\ 31 C.F.R. Sec. 540.505 (1985), 50 Fed.. Reg. at 19892.
---------------------------------------------------------------------------
    Libya embargo (1986).--In response to various policies and 
actions of Libya, President Reagan invoked his IEEPA powers on 
January 7, 1986, to impose a trade embargo on Libya, including 
a general prohibition on the exports to that country of goods, 
technology (including technical data or other information), and 
services effective February 1, 1986.\15\ The President also 
placed a ban on the grant or extension of credits by any U.S. 
person to the Libyan Government, effective January 7, 1986.\16\ 
Except as authorized by OFAC, no goods, technology (including 
technical data or other information), or services could be 
exported to Libya, except publications and donated articles 
intended to relieve human suffering, such as food, clothing, 
medicine and medical supplies intended strictly for medical 
purposes.\17\ The ban did not apply to goods laden on vessels 
or airlines before the effective date, to goods that had left 
the United States by other means before the effective date, or 
to payments relating to such goods even when the payments 
occurred after the effective date.\18\
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    \15\ Executive Order 12543, Sec. Sec. 1(b), 3, 51 Fed.. Reg. 875 
(1986).
    \16\ Executive Order 12543, Sec. Sec. 1(f), 3, 51 Fed.. Reg. at 
875.
    \17\ 31 C.F.R. Sec. 550.202, 51 Fed.. Reg. 1354, 1355 (1986).
    \18\ 31 C.F.R. Sec. 550.404, 51 Fed.. Reg. 1355 (1986).
---------------------------------------------------------------------------
    Iraq embargo (1990).--In response to Iraq's invasion of 
Kuwait in August 1990, President Bush invoked his IEEPA 
authorities to prohibit the exportation to Iraq of any goods 
from the United States, except publications and other 
informational materials, and donations of articles intended to 
relieve human suffering, such as food, clothing, medicine and 
medical supplies intended strictly for medical purposes.\19\ 
The order, dated August 2, 1990, was effective immediately.\20\ 
A week later, the President issued a second order in which he 
prohibited the exportation to Iraq of any goods, including 
technical data or other information, either (1) from the United 
States, or (2) requiring the issuance of a license by a Federal 
agency, or any activity that promotes or is intended to promote 
such exportation, except donations of articles intended to 
relieve human suffering, such as food and supplies intended 
strictly for medical purposes.\21\ This order, dated August 9, 
1990, was also effective immediately.\22\ There were no 
contract sanctity provisions in these orders. Regulations 
provided that, except as otherwise authorized, no goods, 
technology (including technical data or other information) 
could be exported to Iraq, except ``donated foodstuffs in 
humanitarian circumstances, and donated supplies intended 
strictly for medical purposes,'' provided their exportation was 
specifically licensed under named OFAC regulations.\23\ Goods 
awaiting exportation to Iraq on the effective date of the 
President's order that were seized or detained by the U.S. 
Customs Service on or following that date could be released to 
the exporter under certain conditions.\24\
---------------------------------------------------------------------------
    \19\ Executive Order 12722 of August 2, 1990, Sec. 2(b), 55 Fed. 
Reg. 31803 (1990).
    \20\ Executive Order 12722, Sec. 3, 55 Fed. Reg. at 31804.
    \21\ Executive Order 12724 of August 9, 1990, Sec. 2(b), 55 Fed. 
Reg. 33089 (1990).
    \22\ Executive Order 12724, Sec. 4, 55 Fed. Reg. at 33090.
    \23\ 31 C.F.R. Sec. 575.205, 56 Fed. Reg. 2112, 2114-15 (1991). See 
also 31 C.F.R. Sec. 575.520 and 575.521, 56 Fed. Reg. at 2121, 
regarding licensing policy for donations of food and medical supplies, 
respectively.
    \24\ 31 C.F.R. Sec. 575.517, 56 Fed. Reg. at 2120.
---------------------------------------------------------------------------
    Haiti embargo (1991/1993).--In response to activities 
involving the de facto regime in Haiti, President Bush on 
October 28, 1991, cited his authorities under IEEPA and other 
provisions of law to prohibit exports from the United States to 
that country, effective November 5, 1991, except for: (1) 
information materials; (2) donations of articles intended to 
relieve human suffering; and (3) rice, beans, sugar, wheat 
flour, and cooking oil.\25\ The Haitian Transactions 
Regulations issued by the Office of Foreign Assets Control in 
March 1992 to administer the embargo provided also for the 
case-by-case authorization of commercial exports of medicines 
and medical supplies to Haiti under certain conditions,\26\ 
case-by-case licensing of certain exportations from the United 
States to Haiti by certain U.S. persons engaged in the assembly 
or processing in Haiti of articles for export to the United 
States which contained parts or materials exported from the 
United States,\27\ and certain other exports. Neither the 
President's order, nor the regulations appeared to contain a 
contract sanctity provision. Given that the embargo was 
selective, that exports of certain agricultural products were 
covered, and that exports of such items under existing sales 
contracts could seemingly have been affected, the bill's 
provisions would apparently have applied.
---------------------------------------------------------------------------
    \25\ Executive Order 12779 of October 28, 1991, Sec. 2(c), 56 Fed. 
Reg. 12779 (1991).
    \26\ 31 C.F.R. Sec. 580.510, 57 Fed. Reg. 10820, 10828 (1992). The 
Haitian Transaction Regulations were amended in September 1992 to 
expand the general authorization for the export of certain food 
products to include corn and corn flour, milk (including powdered 
milk), and edible tallow (that is, hardened shortening, including 
lard). 57 Fed. Reg. 39603 (1992), adding 31 C.F.R. Sec. 580.516.
    \27\ 31 C.F.R. Sec. 580.515, 57 Fed. Reg. at 10829.
---------------------------------------------------------------------------
    United States trade and financial sanctions against Haiti 
were suspended by OFAC in September 1993 \28\ and reimposed in 
October of that year.\29\ The President's direction to OFAC to 
reimpose the export embargo in October 1993 may seemingly be 
considered a new action covered by the bill.\30\
---------------------------------------------------------------------------
    \28\ 58 Fed. Reg. 46540 (1993).
    \29\ 58 Fed. Reg. 54024 (1993).
    \30\ ``Clinton Acts to Block Trade with Haiti; U.S. Backs U.S. with 
Unilateral Sanctions,'' 10 Int'l Trade Rep. 1756 (BNA 1993). In May 
1994, President Clinton issued an executive order under IEEPA and other 
statutes that amended the export prohibitions imposed under the 
President's 1991 order to prohibit, effective May 21, 1994, the export 
by United States persons or from the United States of any goods, 
regardless of origin, to Haiti, or any activity by United States 
persons or in the United States that promoted the export of such goods, 
except for: (1) information materials, or (2) medicines and medical 
supplies, as authorized by the Secretary of the Treasury, and rice, 
beans, sugar, wheat flour, cooking oil, corn, corn flour, milk, and 
edible tallow, provided that neither the de facto regime in Haiti nor 
any person designated by the Treasury Secretary as a blocked individual 
or entity of Haiti was a direct or indirect party to the transaction. 
Executive Order 12917 of May 21, 1994, Sec. 1(d), 59 Fed. Reg. 26925 
(1994) (emphasis added); see also Executive Order 12920 of June 10, 
1994, 59 Fed. Reg. 30501 (1994). The 1994 order also contained language 
that made the prohibition applicable ``notwithstanding the existence of 
any rights or obligations conferred or imposed by . . . any contract 
entered into or license or permit granted before the effective date'' 
of the President's order. Executive Order 12917, Sec. 1, 59 Fed. Reg. 
at 26925. While this expansion of the embargo contained language 
regarding existing contract rights and may theoretically have covered 
export sales contracts involving agricultural commodities not exempted 
by the order, where the contract was entered into up to 5 days after 
May 21, 1994 (the effective date of the order), the President's action 
may not have had an additional impact on exports from the United States 
given the earlier orders affecting such goods.
---------------------------------------------------------------------------
    Iran export embargo (1995).--On May 7, 1995, President 
Clinton invoked his IEEPA authority and other statutory 
provisions to expand existing economic restrictions on Iran to 
include a prohibition on the exportation from the United States 
to Iran, or the financing of any such exportation, of any 
goods, technology, or services, ``except to the extent provided 
in section 203(b) of IEEPA (50 U.S.C. 1702(b)).'' \31\ The 
prohibition applied ``notwithstanding any contract entered into 
or any license or permit granted prior to the effective date of 
the order.'' \32\ The export prohibition applied as of June 6, 
1995, to trade transactions under contracts in force as of the 
date of the order if the transactions were authorized pursuant 
to federal regulations in force immediately prior to the date 
of the order.\33\ Letters of credit and other financing 
agreements with respect to the contracts just described could 
be performed pursuant to their terms with respect to the 
underlying trade transactions occurring prior to June 6, 
1995.\34\ Regulations provided that ``[e]xcept as otherwise 
authorized, and notwithstanding any contract entered into or 
any license or permit granted prior to May 7, 1995, the 
exportation from the United States to Iran or the Government of 
Iran, or the financing of such exportation, of any goods, 
technology or services is prohibited,'' but made an exception 
for, inter alia, humanitarian donations and information and 
informational materials.\35\ The regulations also authorized: 
(1) all transactions by U.S. persons in connection with the 
exportation from the United States to Iran of any agricultural 
commodity under an export sales contract, provided the contract 
was entered into prior to May 7, 1995, and the terms of the 
contract required delivery prior to February 6, 1996, and (2) 
the performance of letters of credit and other financing 
agreements pursuant to their terms with respect to agricultural 
exports authorized by OFAC.\36\ The term agricultural commodity 
was defined as ``feed grains, rice, wheat, cotton, peanuts, 
tobacco, dairy products, and oilseeds (including vegetable 
oil).'' \37\ In addition, specific licenses could be granted on 
a case-by-case basis for the export of other ``agricultural 
articles'' from the United States that did not fall within the 
definition just quoted, provided the exportation was ``pursuant 
to an export sales contract'' and the deadlines mentioned above 
met.\38\ Because the export embargo exempted some transactions 
and, notwithstanding its exceptions for agricultural 
commodities, could theoretically have covered some export sales 
contracts for agricultural commodities entered into up to 5 
days after the President's announcement, the bill would 
seemingly have applied.
---------------------------------------------------------------------------
    \31\ Executive Order 12959 of May 5, 1995, Sec. 1(b), 60 Fed. Reg. 
24757 (1995). Regarding Sec. 203(b) of IEEPA, see supra note 10.
    \32\ Executive Order 12959, Sec. 1, 60 Fed. Reg. at 24758.
    \33\ Executive Order 12959, Sec. 8, 60 Fed. Reg. at 24758.
    \34\ Id.
    \35\ 31 C.F.R. Sec. Sec. 560.204, 560.210(b)-(c), 60 Fed. Reg. 
47063, 47064 (1995).
    \36\ 31 C.F.R. Sec. Sec. 560.520(a)-(b), 60 Fed. Reg. at 47070.
    \37\ 31 C.F.R. Sec. Sec. 560.520(c), 60 Fed. Reg. at 47070.
    \38\ 31 C.F.R. Sec. Sec. 560.520(d), 60 Fed. Reg. at 47070.
---------------------------------------------------------------------------
    Sudan embargo (1997).--In response to activities of Sudan 
involving terrorism, destabilization of neighboring 
governments, and human rights violations, President Clinton 
used his IEEPA powers on November 3, 1997, to impose trade and 
financial restrictions on Sudan, including a prohibition on the 
exportation to Sudan of any goods or technology from the United 
States or by a U.S. person, or requiring the issuance of a 
license by a Federal agency, except for donations of articles 
intended to relieve human suffering, such as food, clothing, 
and medicine.\39\ The order also prohibited U.S. persons from 
extending credits or loans to the Government of Sudan.\40\ The 
order took effect at midnight November 4, 1997, except that 
trade transactions under contracts in force as of the effective 
date could be performed pursuant to their terms through 
December 4, 1997, and letters of credit and other financing 
agreements for these trade transactions could be performed 
pursuant to their terms.\41\ Since export sales contracts 
entered into up to 5 days after the effective date of the 
President's order would not have been covered by its 
retroactivity provision, the bill's provision seemingly would 
have applied.
---------------------------------------------------------------------------
    \39\ Executive Order 13067 of November 3, 1997, Sec. 2(b), 62 Fed. 
Reg. 59989 (1997).
    \40\ Executive Order 13067, Sec. 2(e), 62 Fed. Reg. at 59989.
    \41\ Executive Order 13067, Sec. 7(a), 62 Fed. Reg. at 59990.

                              APPENDIX II

                              ----------                              

                                                 February 10, 1999.
Hon. Tom Ewing,
House of Representatives, Rayburn,
Washington, DC.
    Dear Congressman Ewing. The undersigned organizations, 
representing a broad section of American agriculture, are 
writing in support of your legislation, H.R. 17, the 
``Selective Agricultural Embargoes Act of 1999.''
    H.R. 17 would require congressional review and approval of 
both Houses of Congress if the President imposes an 
agricultural embargo on a foreign country. This legislation 
provides a vital and necessary foreign policy checks and 
balance system. H.R. 17 does not impede the President's 
authority to impose cross-sector embargoes. This was the policy 
of the United States in the late 1980s.
    The soybean and grain embargoes of the 1970s and 1980 had a 
devastating impact on American agriculture, resulting in lost 
sales, market share and opportunities. Agriculture can not be 
used as a political tool and foreign policy football. American 
agriculture and the U.S. government must send a strong message 
to our many customers and competitors that U.S. farmers and 
ranchers are consistent and reliable suppliers of agricultural 
products.
    We commend you for your leadership and commitment.
            Sincerely,
                    Agricultural Retailers Association; Alabama Farmers 
                            Federation; American Cotton Shippers 
                            Association; American Farm Bureau 
                            Federation; American Meat Institute; 
                            American Soybean Association; Bunge 
                            Corporation; Central Soya Co., Inc.; 
                            Cerestar USA; Continental Grain; Corn 
                            Refiners Association; Farmland Industries, 
                            Inc.; Food Distributors International; IMC 
                            Global; Independent Bankers Association; 
                            Louis Dreyfus Corporation; National 
                            Association of Animal Breeders; National 
                            Association of State Departments of 
                            Agriculture; National Association of Wheat 
                            Growers; National Cattlemen's Beef 
                            Association; National Chicken Council; 
                            National Corn Growers Association; National 
                            Council of Farmer Cooperatives; National 
                            Farmers Union; National Food Processors 
                            Association; National Grain and Feed 
                            Association; National Grain Sorghum 
                            Producers; National Grain Trade Council; 
                            National Grange; National Milk Producers 
                            Federation; National Oilseed Processors 
                            Association; National Pork Producers 
                            Council; National Renderers Association; 
                            National Sunflower Association; North 
                            American Export Grain Association; North 
                            American Millers' Association; Pet Food 
                            Institute; Sunkist Growers; The Fertilizer 
                            Institute; United Egg Association; United 
                            Egg Producers; U.S. Canola Association.

                                  
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