Iraq's Transitional Law (25-MAY-04, GAO-04-746R).		 
                                                                 
On June 30, 2004, the Coalition Provisional Authority (CPA)	 
intends to transfer power in Iraq to a fully sovereign Iraqi	 
interim government. CPA and the Iraq Governing Council took a	 
fundamental step toward this goal in March 2004, when they signed
the Law of Administration for the State of Iraq for the 	 
Transitional Period (hereafter referred to as the transitional	 
law). The transitional law is intended to govern the affairs of  
Iraq until Iraqis approve a permanent constitution and a	 
permanent Iraqi government takes office. GAO has ongoing and	 
completed work reviewing various aspects of the U.S. effort to	 
reconstruct Iraq. Our ongoing work includes reviewing the costs  
associated with reconstruction; the process used to award	 
reconstruction contracts; efforts to develop Iraq's security	 
forces; the rebuilding of Iraq's oil, electricity, and water	 
infrastructure; and programs to help Iraq develop a unified,	 
democratic government. For this report, we describe the following
information as it exists at this time: (1) the time frames and	 
Iraqi governmental structures established by the transitional	 
law; (2) arrangements in the law for the U.S.-led multinational  
force, Iraqi security forces, and militias; and (3) mechanisms in
the law for resolving disputes over property and territories	 
within Iraq. In each of these areas, we also explain the	 
transitional law's references to other Iraqi laws and legal	 
provisions that help implement the transitional law. Where legal 
provisions to address these issues have not been completed, we	 
describe the progress toward their completion or other actions to
address the issues. We recognize that the situation is fluid and 
that there are ongoing efforts to address unresolved issues.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-04-746R					        
    ACCNO:   A10219						        
  TITLE:     Iraq's Transitional Law				      
     DATE:   05/25/2004 
  SUBJECT:   International law					 
	     International relations				 
	     Crude oil						 
	     Physical security					 
	     Military operations				 
	     Intergovernmental relations			 
	     Iraq						 

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GAO-04-746R

United States General Accounting Office Washington, DC 20548

May 25, 2004

The Honorable Richard G. Lugar
Chairman
The Honorable Joseph R. Biden, Jr.
Ranking Member
Committee on Foreign Relations
United States Senate

The Honorable Henry J. Hyde
Chairman
The Honorable Tom Lantos
Ranking Member
Committee on International Relations
House of Representatives

Subject: Iraq's Transitional Law

On June 30, 2004, the Coalition Provisional Authority (CPA) intends to
transfer power in Iraq to a fully sovereign Iraqi interim government.1 CPA
and the Iraq Governing Council took a fundamental step toward this goal in
March 2004, when they signed the Law of Administration for the State of
Iraq for the Transitional Period (hereafter referred to as the
transitional law). The transitional law is intended to govern the affairs
of Iraq until Iraqis approve a permanent constitution and a permanent
Iraqi government takes office.2

GAO has ongoing and completed work reviewing various aspects of the U.S.
effort to reconstruct Iraq. Our ongoing work includes reviewing the costs
associated with reconstruction; the process used to award reconstruction
contracts; efforts to develop Iraq's security forces; the rebuilding of
Iraq's oil, electricity, and water infrastructure; and programs to help
Iraq develop a unified, democratic government. For this report, we
describe the following information as it exists at this time: (1) the time
frames and Iraqi governmental structures established by the transitional
law; (2) arrangements in the law for the U.S.-led multinational force,
Iraqi security forces, and militias; and (3) mechanisms in the law for
resolving disputes over property and territories within Iraq. In each of
these areas, we also explain the transitional law's

1The Coalition Provisional Authority (CPA) is the U.N.-recognized
coalition authority, led by the United States and the United Kingdom,
responsible for the temporary governance of Iraq.

2The transitional law states that on June 30 a "fully sovereign Iraqi
Interim Government" will take power. However, the law does not further
elaborate the structure or authority of the interim government.

references to other Iraqi laws and legal provisions that help implement
the transitional law. Where legal provisions to address these issues have
not been completed, we describe the progress toward their completion or
other actions to address the issues. We recognize that the situation is
fluid and that there are ongoing efforts to address unresolved issues.

To address these objectives, we examined the transitional law and related
CPA regulations, orders, and memoranda, as well as assessments of Iraqi
institutions prepared by the Department of Justice and nongovernmental
organizations. We met with officials from the Departments of State
(State), Defense (DOD), and Justice, and CPA to clarify provisions of the
transitional law. We also discussed with these officials progress toward
completing provisions referred to in the transitional law, such as the
annex and electoral laws. We conducted our review from March to May 2004
in accordance with generally accepted government auditing standards.

Overview

Iraq's transitional law divides the transitional period into two
phases3-the interim government phase, which begins June 30, 2004, and the
transitional government phase, which begins after elections for a National
Assembly are held and the transitional government is formed. The law does
not specify how the interim government is to be formed or structured, but
provides that the interim government will govern in accordance with an
annex to be developed. Since April 2004, the United Nations has been
playing a key role in helping form and structure the interim government.
Elections for the National Assembly are to be held no later than January
31, 2005, under an election law that, according to CPA officials, they aim
to complete before the transfer of power. For the transitional government
phase, the transitional law details the government's structure and
responsibilities, including procedures for developing a permanent
constitution and the federal structure. The National Assembly will draft a
permanent constitution for the Iraqi people's approval in a general
referendum. However, if a majority of Iraqi voters or if two-thirds of the
voters in 3 of Iraq's 18 governorates reject the constitution, elections
for a new National Assembly will be held and the process of drafting a
permanent constitution begins again. To prevent the concentration of power
in the federal government, the transitional law encourages local authority
during the transitional period. The transitional law recognizes the
Kurdistan Regional Government and specifies that it controls the police
forces and internal security in the Kurdistan region.

The transitional law includes some provisions under which Iraqi security
forces and the multinational force will provide security in Iraq after the
transfer of power. Officials from DOD and State are examining what
additional provisions, if any, may be necessary to further define the role
of the multinational force after June 30, including a new U.N. Security
Council resolution or revisions to existing CPA orders. The transitional
law also outlines elements of the command and control structure for

3Under the transitional law, the transitional period covers the interim
government phase and the transitional government period. The interim
government phase begins June 30, 2004, and the transitional government
phase ends with the formation of an elected Iraqi government under a
permanent constitution.

some Iraqi security forces and outlaws all militias not under the command
structure of the transitional government, except where provided by federal
law. According to State and DOD officials, CPA is currently considering
how it could further elaborate on provisions for both of these areas.

The transitional law includes provisions for the transitional government
to implement that are related to resolving disputes over property rights
and territory. These disputes resulted from the previous regime's
practices in altering the demographic character and boundaries of certain
regions and territories, including Kirkuk. One provision calls for
compensating residents who were deported, expelled, or who emigrated, by
restoring their homes and property to them, or, where this is infeasible,
providing just compensation within a reasonable time. Another provision
establishes a process Iraqis will use to resolve the status of disputed
territories. If Iraqis cannot resolve the status of disputed territories
through the prescribed processes, they would request assistance from the
United Nations.

The transitional law provides a road map for establishing a permanent,
unified, and democratic government in Iraq. Nonetheless, some issues
related to the transfer of power remain unresolved. For example, the
transitional law does not specify how the interim government is to be
structured, nor does it fully clarify the authority of a multinational
force in Iraq after the transition of power. U.S. officials and others are
working to resolve these and other issues before June 30, to ensure that
the transfer of authority can proceed as planned. These issues are
discussed in our summary.

The Departments of State and Justice declined to provide comments on a
draft of this correspondence. The Department of Defense and the Coalition
Provisional Authority did not provide official comments, but sent us
technical comments, which we incorporated as appropriate.

Background

On November 15, 2003, the Iraq Governing Council and CPA signed an
agreement on the steps needed to transfer power to an Iraqi transitional
administration. The Iraq Governing Council completed a key step in this
process by drafting the transitional law in consultation with CPA and
signing it on March 8, 2004. The transitional law states that it is the
supreme law of the land and that it is binding in all parts of Iraq during
the transitional period. It contains 62 articles that (1) protect or
guarantee fundamental rights for all Iraqis, including the right of free
expression, peaceable assembly, religion, and a fair and public hearing by
an impartial tribunal and (2) outline the structure and authority of
Iraq's transitional government, including its federal structure and
legislative, executive, and judicial branches.

The transitional law also states that it cannot be amended except by the
approval of Iraq's transitional presidency council and a three-fourths
majority of the National Assembly. Similarly, all laws in place in Iraq
before June 30, 2004, will remain in force until amended or rescinded by
the transitional government. Similarly, CPA laws, regulations, orders, and
directives shall remain in force until amended or rescinded by duly
enacted legislation. The law also makes Islam the official religion of
Iraq and states that Islam is a source of legislation. The law clarifies
this by stating that no law that contradicts the universally agreed tenets
of Islam, the principles of

democracy, or other rights may be enacted. Moreover, it guarantees to all
individuals full freedom of religious belief and practice.

To support governance and security issues related to implementing the
transitional law, the United States had obligated about $1.7 billion as of
April 2004. This includes $244 million for the Iraqi police and security
forces; $378 million for rule of law and democracy building, including the
interim and transitional governments; and $1.08 billion for CPA and U.S.
agencies' operating expenses in Iraq.

Time Frames and Establishment of an Iraqi Government during the
Transitional Period

The transitional law divides the transitional period into two phases. The
first phase begins June 30, 2004, when a fully sovereign interim
government assumes power. The transitional law does not detail how the
interim government is to be formed or how it will be structured, but
refers to an annex to be developed before June 30, 2004. As of May 2004,
the United Nations was playing a key role in helping form this interim
government. During the interim government phase, elections for a National
Assembly are to be held no later than January 31, 2005. The second phase
begins after the Iraqi people elect the National Assembly and the
transitional government is formed. The transitional government will then
draft a permanent constitution for the Iraqi people's consideration. The
second phase will end once the Iraqi people approve a permanent
constitution and elect a permanent government. Figure 1 shows the key
dates for the two phases.

  Figure 1: Time Line of Major Events for Interim and Transitional Governments

Interim Government during First Phase

The transitional law states that a fully sovereign interim government will
assume power in Iraq on June 30, 2004, and that the interim government
will be formed through consultations with Iraqis and possibly in
consultation with the United Nations. The transitional law does not
specify the exact process for forming the interim government, nor does it
define its structure or authority. It provides that the interim government
will govern Iraq in accordance with the transitional law and the
forthcoming annex to the transitional law to be issued before June 30.
Since April 2004, the United Nations has also been playing a key role in
helping form the interim government. The U.N. Special Adviser on Iraq
proposed that the interim government be a caretaker with the sole purpose
of tending to the day-to-day administration of

4

the country. The special adviser further proposed that a prime minister
lead the interim government and that a president serve as head of state,
with two vice presidents. He stated that, by the end of May 2004, it would
be possible to identify leaders respected by and acceptable to Iraqis
across the country to form this government.

One key function of the interim government is to prepare Iraq for
conducting elections for a National Assembly that will then form a
transitional government. The transitional law provides that the National
Assembly elections will be held in accordance with an electoral law and a
political parties law. These laws do not currently exist and CPA officials
are drafting CPA orders to address these issues, according to U.S.
officials. According to the transitional law, two goals of the electoral
law are to have women constitute one-fourth of the members of the National
Assembly and to achieve fair representation for all communities in Iraq.
The transitional law does not specify any other provisions to be included
in the electoral or political parties laws. The U.N. Special Adviser
recommended that the leaders of a caretaker government should not be
candidates for the National Assembly.

The U.N. Special Adviser also proposed that during the interim government
phase, a national conference be held of at least 1,000 Iraqis representing
all political parties, tribal leaders, universities, women's groups,
religious leaders, and others. The national conference would contribute
ideas on how to address the security situation, elections, and aspects of
the transitional law. According to the U.N. Special Adviser, a
consultative council of the national conference would be available to
advise the government on such issues.

Transitional Government during Second Phase

The second phase will begin after elections for a National Assembly are
held and the transitional government is in place. Elections are to be held
no later than January 31, 2005. The transitional government will consist
of separate and independent legislative, executive, and judicial
authorities (see fig. 2). According to the transitional law, once elected
and assembled, the National Assembly will elect the Presidency Council,
which will then name a prime minister. The prime minister will recommend
candidates for the Council of Ministers, which the Presidency Council will
name. Both the prime minister and Council of Ministers will be subject to
a vote of confidence by the National Assembly. The Presidency Council will
also appoint judges to the Federal Supreme Court from candidates that the
Higher Juridical Council nominates.

4In testimony before the House Armed Services Committee on April 21, 2004,
and before the Senate Foreign Relations Committee on April 22, 2004, Under
Secretary Marc Grossman of the Department of State noted that one of the
Administration's criteria for the interim government is that it not have a
law-making body.

Figure 2: Formation of the Iraqi Transitional Government

The National Assembly will perform legislative and oversight functions.
Composed of 275 members, it will develop its own internal procedures and
sit in public sessions. It will examine bills proposed by the Council of
Ministers, propose its own bills, ratify international treaties, and
exercise oversight over the work of the executive authority.

A key function of the National Assembly is to write a draft permanent
constitution by August 15, 2005.5 The Iraqi people will then vote to
approve the constitution in a general referendum to be held by October 15,
2005. If the permanent constitution is approved in the referendum,
elections for a permanent government would take place no later than
December 15, 2005, and the permanent government would take office no later
than December 31, 2005. However, if a majority of Iraqi voters do not
approve the draft constitution or if two-thirds of the voters in three or
more governorates reject it, then the National Assembly will be dissolved.
Elections for a new National Assembly would take place by December 15,
2005. The new government would continue to operate under the transitional
law and be responsible for writing another draft permanent constitution.

The executive authority of the transitional government will consist of the
Presidency Council, prime minister, and Council of Ministers. The
Presidency Council will consist of a president and two deputies. All
decisions made by the Presidency Council must be unanimous. The Presidency
Council may veto any legislation passed by the National Assembly, but the
National Assembly may override a veto with a two-thirds majority vote. The
prime minister will be responsible for the day-to

5If the National Assembly cannot meet this deadline, the President of the
National Assembly may certify the need for additional time to write a
draft constitution to the Presidency Council, but must do so no later than
Aug. 1, 2005. The Presidency Council may extend the deadline by 6 months
but may not extend the deadline again.

day management of the government. The Council of Ministers will draw up
rules of procedure for its work and issue regulations necessary to enforce
the laws. It will also have the exclusive right to propose a national
budget to the National Assembly.

The transitional law modifies the existing judiciary by establishing a
Higher Juridical Council and Federal Supreme Court. The Higher Juridical
Council will supervise the federal judiciary and administer its budget,
nominate judges for the Federal Supreme Court, and appoint judges to the
federal courts. The Higher Juridical Council will be composed of judges
from the Federal Supreme Court, the federal Court of Cassation,

6

the federal Court of Appeal, and each regional Court of Cassation. The
nine-member Federal Supreme Court will have jurisdiction over legal
matters between the transitional government and the regional governments,
governorate and municipal administrations, and local administrations. It
will also have jurisdiction over complaints that a law is inconsistent
with the transitional law.7 Figure 3 illustrates the legislative,
executive, and judicial structure laid out in the transitional law.

Figure 3: Function and Composition of the Iraqi Transitional Government

Provisions for Regions and Governorates

According to the transitional law, the Iraq government will be a federal
system designed to prevent concentration of power in the federal
government and to encourage the exercise of local authority and
participation in government affairs.

6According to the transitional law, the court of cassation is the court of
last resort in Iraq except where the Federal Supreme Court has
jurisdiction.

7The Federal Supreme Court's ordinary appellate jurisdiction will be
defined under federal law.

The transitional law recognizes the Kurdistan Regional Government as the
official government of the territories that were administered by that
government on March 19, 2003. The Kurdistan Regional Government will
continue to perform its current functions throughout the transitional
period, except with regard to issues that the transitional law exclusively
reserves for the federal government. Specifically, it retains control over
the police forces and internal security and has the right to impose taxes
and fees within the Kurdistan region.

The transitional law allows for the formation of other regions within
Iraq. Except for Baghdad and Kirkuk, groups of two or three governorates
can form regions. The law does not specify how these regions could be
formed but allows the interim government to propose mechanisms for their
formation. The National Assembly would consider the proposal for enactment
into law. Before a region can be formed, the people of the relevant
governorates must approve the proposal in a referendum.

Each of Iraq's 18 governorates has the power to name a governor and form
municipal and local councils. Elections for governorate councils will take
place at the same time as elections for the National Assembly (no later
than January 31, 2005). Governorate councils will have the authority to
impose taxes and fees, organize administration of the governorate,
implement projects at the provincial level independently or with other
organizations, and conduct other activities consistent with applicable
laws. In addition, governorate councils will assist the federal government
in coordinating federal ministry operations within their governorates,
including reviewing annual ministry plans and budgets as they relate to
activities in the governorate. The transitional law also encourages the
federal government to devolve other functions to lower levels of
government where appropriate.

Arrangements for the Multinational Force, Iraqi Security Forces, and
Militias

The transitional law includes some provisions for the framework under
which Iraqi security forces and the multinational force will provide
security in Iraq after the transfer of power on June 30, 2004. Officials
from DOD, State, and CPA are examining what authorities in addition to the
current U.N. Security Council resolution and CPA order may be necessary.
The transitional law also outlines elements of the command and control
structure for some Iraqi security forces and outlaws all militias except
where provided by federal law. According to State and DOD officials, CPA
is currently addressing issues related to these areas.

Mandate and Legal Status of the Multinational Force

According to Article 59 of the transitional law, the multinational force
will continue operating in Iraq pursuant to the provisions of U.N.
Security Council Resolution 1511 and any subsequent resolutions. In this
resolution, the U.N. Security Council determined that the provision of
security and stability is essential to the completion of Iraq's political
transition process. Toward that end, the resolution authorized a
multinational force under unified command to take all necessary measures
to contribute to the maintenance of security and stability in Iraq,
including ensuring necessary conditions for implementing the political
transition's timetable and

program. It also authorized the multinational force to provide security
for the U.N. Assistance Mission for Iraq, the Governing Council for Iraq,
other institutions of the Iraqi interim administration, and key
humanitarian and economic infrastructure. In the resolution, the U.N.
Security Council called for this mandate to expire upon the establishment
of an internationally recognized, representative government of Iraq and
the completion of the political process in Security Council Resolution
1511.8 However, the Security Council expressed readiness to consider any
need to continue the multinational force, taking into account the views of
this new Iraqi government.

The transitional law does not specifically deal with legal immunities for
the force during the transitional period. However, the transitional law
states that CPA orders remain in force until rescinded or amended by
legislation. According to CPA Order 17, the multinational force is subject
to the exclusive jurisdiction of their parent states and are immune from
Iraqi legal jurisdiction.9 This immunity remains in effect for their acts
or omissions that occur during the period of authority of CPA, which is
due to expire on June 30, 2004.

Senior officials from DOD and State have stated that the transitional law,
U.N. Security Council Resolution 1511 and any subsequent resolution, and
CPA Order 17 will sufficiently address the legal status of the
multinational force after the transfer of power on June 30, 2004.
According to a senior State official, the United States is currently
working on a new Security Council resolution on Iraq to support the June
30 transition. According to this official, this resolution, among other
things, would address the continuing need for security to complete the
political process and would further define the role of the multinational
force after June 30. In addition, a DOD official told us that CPA Order 17
is being revised and may provide more detail on the status of the
multinational force than the current version.10 While CPA Order 17, the
transitional law, and U.N. Security Council Resolution 1511 cover many
important elements of the legal status of the multinational force, they do
not explicitly address other key issues, such as the authority of the
force to move its personnel, equipment, and supplies into and throughout
the country after the transfer of power. Nonetheless, subsequent U.N.
resolutions or other agreements could address these issues.

For the transitional government phase, Article 59 of the transitional law
authorizes the government to conclude binding international agreements
regarding the activities

8Security Council Resolution 1511 lays out a political process that
includes the internationally recognized Iraqi government assuming the
CPA's responsibilities, providing a timetable and program for drafting a
new constitution and holding elections, and convening a constitutional
conference.

9According to this order, in cases where coalition personnel commit an act
in Iraq for which the parent state has no criminal sanctions, CPA may
request that the parent state waive jurisdiction to try such acts under
Iraqi law. In these cases, no legal process could begin without the
written permission of the CPA Administrator.

10According to the Department of Defense's Joint Publication 1-02, a
status of forces agreement defines the legal position of a visiting
military force deployed in the territory of a friendly state. Such an
agreement's provisions describe (1) how the authorities of a visiting
force may control that force's members, and (2) the amenability of the
force or its members to the local law or to the authority of local
officials. Provisions pertaining to the status of visiting forces may be
in a separate agreement or they may form a part of a more comprehensive
agreement.

of the multinational force operating in Iraq. The transitional law further
states that nothing in the law will affect the rights and obligation under
these bilateral agreements, or U.N. Security Council Resolution 1511 and
any subsequent U.N. resolution, which will govern the activities of the
multinational force pending the entry into force of these agreements.

Control and Command of Iraqi Security Institutions

The transitional law and related CPA orders discuss the relationship
between some of the Iraqi security forces and the multinational force
after the transfer of power, as shown in the following table.

Table 1: Control of Iraqi Security Forces after June 30, 2004

                Security                     Force Level          Controlling 
Ministry        Force         Mission  As of               Authority after 
                                         5/05/04a Requirement   June 30, 2004 
                                                              The Ministry of 
                         Security forces                      Defense shall   
             Iraqi Armed that will be                         exercise        
                  Forces responsible for                      administrative  
            Regular army the defense of     4,100      35,000 control.        
               and other Iraqi territory                      Coalition       
              services b when fully                           Forces will     
                         operational.                         have            
                                                              operational     
                                                              control.c       
                         Security and                                         
                         emergency                                            
Ministry              service agency                                       
      of                 that directly                                        
Defense               supports                             The Ministry of 
                         coalition                            Defense shall   
                         operations to                        exercise        
            Iraqi Civil  provide                              administrative  
              Defense    security and     29,100       41,500 control.        
               Corps     stability.                           Coalition       
                         Complements the                      Forces will
                         police force,                        have
                         but designed to                      operational
                         perform                              control.
                         operations that                      
                         exceed the                           
                         capacity of the                      
                         police.                              
                         Primary law                                          
                         enforcement                                          
            Iraqi Police agency                                       Not yet
                 Service responsible for  87,300       89,400     determined.
                         public safety,                       
                         security, and                        
                         order.                               
                         Monitors and                                         
                         controls the                                         
                         movement of                          
                         persons and                          
                         goods to, from,                      
                         and across the                       
              Department borders of                           
Ministry    of Border Iraq. Includes  15,900d       20,400         Not yet
    of the   Enforcement Iraqi Border                             determined.
Interior              Police charged                       
                         with border and                      
                         customs                              
                         enforcement, as                      
                         well as                              
                         immigration                          
                         duties.                              
                         Guards who                                           
                         secure                                               
                         individual                           
              Facilities ministry and                                 Not yet
              Protection municipal        74,100       75,000     determined.
                 Service facilities                           
                         against                              
                         vandalism and                        
                         theft.                               

Sources: DOD, CPA.

aGAO has not performed data reliability testing on these figures.

bAccording to a CPA official, these forces include units of the Iraqi
Army, Iraqi Naval Infantry (less than a battalion), Iraqi Army Aviation (a
few helicopters and small transport planes), Iraqi Coastal Defense Force
(about a half-dozen patrol boats), an Iraqi counterterrorism force, and
associated headquarters.

cAccording to DOD's Joint Publication 1-02, "DOD Dictionary of Military
and Associated Terms," administrative control is the direction or exercise
of authority over subordinate organizations in respect to administration
and support, including control of

resources and equipment, personnel management, unit logistics, individual
and unit training, readiness, mobilization, and discipline. Operational
control is the authority to perform those functions of command over
subordinate forces involving organizing and employing commands and forces,
assigning tasks, designating objectives, and giving authoritative
direction necessary to accomplish the mission.

dFigure includes Border Police and Department of Border Enforcement staff.

As shown in the above table, the Ministry of Defense and the multinational
force will both exercise some element of control over the Iraqi Armed
Forces, which now includes the Iraqi Civil Defense Corps. According to
Article 59 of the transitional law, the Iraqi Armed Forces will be a
principal partner in the multinational force pursuant to the provisions of
U.N. Security Council Resolution 1511 and any subsequent resolutions
during the transitional period. Issued on March 21, 2004, CPA Order 67
provides more detail on this relationship. The order established the
Ministry of Defense, placed the Iraqi Armed Forces under the
administrative control of the Ministry of Defense, and stated that the
Iraqi Civil Defense Corps will be transferred to the Iraqi Armed Forces by
June 1, 2004. The order stated, that pursuant to the provisions of U.N.
Security Council Resolution 1511, all trained elements of the Iraqi Armed
Forces will at all times be under the operational control of the Commander
of the multinational force for the purpose of conducting combined
operations and providing other support in accordance with CPA orders. CPA
Order 73 formally transferred the Iraqi Civil Defense Corps to the
Ministry of Defense as a component of the Iraqi Armed Forces on April 22,
2004.

According to Article 39 of the transitional law, national command
authority on military matters during the transitional government phase is
to flow from the prime minister to the minister of Defense to the military
chain of command of the Iraqi Armed Forces. The law does not define
national command authority during the interim government phase, which
begins on June 30, 2004. According to CPA Order 67, the Ministry of
Defense will operate under the authority, direction, and control of the
CPA Administrator until the transfer of full governance authority to the
Iraqi interim government.

As of May 5, 2004, the CPA Administrator exercised control over the Iraqi
Police, Border Police, and Facilities Protection Service through the
Ministry of the Interior. The Facilities Protection Service differs
somewhat from the other forces in that its personnel are regulated by the
Ministry of the Interior, but are paid and operate under the immediate
command of the individual Ministry employing them. DOD officials have told
us that all of the Ministry of Interior forces listed in the above table
will be under the control of the multinational force after June 30;
however, this arrangement has not been explicitly stated in any legal
documents published by DOD or CPA.

Future of Iraqi Militias

Article 27 of the transitional law specifies that armed forces and
militias not under the command structure of the Iraqi transitional
government are prohibited, except as provided by federal law. The
transitional law does not address the status of militias under the interim
government or establish mechanisms to disband or integrate militias into
Iraq's security forces. However, according to CPA officials, they are
working with political and militia leaders to encourage members of the
militias to play a role in security by enlisting in the Iraqi Armed Forces
and Iraqi Civil Defense Corps. For example, CPA is negotiating with
Kurdish leaders on the transition of

members of the Pesh Merga into national security structures, job
placement, or retirement. State Department officials said that it would
take time to address the transition of militias. Presently, four major
militias and numerous smaller militias are operating in Iraq. Table 2
provides information about some of these militias.

Table 2: Some Militias Present in Iraq

      Militia          Political Affiliation       Location in     Number     
                                                      Iraq     
KDP Pesh Merga Militia of the Kurdistan          Northern   31,000 active  
                  Democratic Party                   portion   
PUK Pesh Merga  Militia of the Patriotic Union   Northern   13,000 active  
                            of Kurdistan             portion   
                  Militia of Supreme Council for                              
Badr Brigades  Islamic Revolution in Iraq, a     Southern    8,000 active
                  Shiite Islamic Fundamentalist      portion   
                  group that has ties with Iran                
                  Followers of Muqtada al-Sadr,    Central and 2,000-5,000    
    Mahdi's Army  the radical Shiite leader         southern   active         
                                                    portions   

11

Source: CPA and Congressional Research Service Reports on Iraq.

Mechanisms for Resolving Disputes Over Property Rights and Territory
during the Transitional Government Phase

The transitional law includes three provisions for the transitional
government to implement related to resolving disputes over property rights
and territory. These disputes resulted from the previous regime's
practices in altering the demographic

12

character and boundaries of certain regions and territories, including
Kirkuk. Article 58(A) outlines mechanisms for resolving disputes over
property rights; Articles 58(B) and (C) discuss the possible mechanisms
and timing for determining the status of disputed territories.

Article 58(A) of the transitional law calls for the Iraqi transitional
government, particularly the Iraq Property Claims Commission13 and other
relevant bodies, to take measures to remedy the injustice caused by the
previous regime's practices in altering the demographic character of
certain regions by expelling or relocating people. For residents who were
deported, expelled, or who emigrated, such measures include restoring to
them their homes and property, or, where this is

11Iraq: U.S. Regime Change Efforts and Post-War Governance, August 29,
2003; Iraq: U.S. Regime Change Efforts and Post-Saddam Governance,
February 23, 2004, Congressional Research Service.

12According to the 2003 State Department Human Rights report, the previous
regime had systematically forced the removal of ethnic minorities under
its admitted policy of "Arabizing" arable land. Specifically, the regime
"Arabized" certain Kurdish areas, such as the urban centers of Kirkuk and
Mosul, through the forced movement of local residents from their homes and
villages and their replacement by Arabs from outside the area. Moreover,
non-Arab citizens-people with Kurdish, Turkmen, Chaldean, or Assyrian
identity-were forced to either change their ethnicity on their identity
documents and adopt Arabic names or be expelled to the Kurd-controlled
northern provinces.

13CPA Regulation 8 delegated authority to the Iraq Governing Council to
establish the Iraq Property Claims Commission for the purpose of
collecting and resolving real property claims. The Iraq Property Claims
Commission statute, effective January 15, 2004, establishes the Commission
and outlines its structure, procedures, and general principals.

infeasible, providing just compensation within a reasonable time, in
accordance with the Iraq Property Claims Commission statute and other
laws. For those people who had been newly introduced to specific regions
and territories, the transitional government will ensure such individuals
may be resettled, compensated, or possibly receive new land near their
residence in the governorate from which they came, in accordance with the
Iraq Property Claims Commission statute. The provision also states that
the transitional government will permit affected persons the right to
determine their own national identity and ethnic affiliation free from
coercion and duress.

Two other provisions, Articles 58(B) and (C), discuss the possible
mechanism and timing for determining the status of disputed territories
whose administrative boundaries the previous regime had altered for
political ends. Article 58(B) establishes a process Iraqis will use to
resolve these disputes before requesting assistance from the United
Nations. The article calls for the Presidency Council of the Iraqi
transitional government to recommend remedies to the National Assembly to
rectify such situations in the permanent constitution. If the Council
cannot unanimously agree on a set of recommendations, it will appoint a
neutral arbitrator to examine the issue and make recommendations. If the
council cannot agree unanimously on an arbitrator it will request the U.N.
Secretary General to appoint a distinguished international person to be
the arbitrator. Article 58(C) states that the permanent resolution of
disputed territories, including Kirkuk, will be deferred until after these
measures are completed, a fair and transparent census has been conducted,
and the permanent constitution has been ratified. The provision also
states that the permanent resolution will take into account the will of
the people of those territories.

Summary

The transitional law provides a road map for establishing a permanent,
unified, and democratic government in Iraq. Nonetheless, some issues
related to the transfer of power remain unresolved. For example, the
transitional law does not specify how the interim government is to be
formed or structured, but states that the interim government will govern
in accordance with an annex to be developed. Since April 2004, the United
Nations has been playing a key role in helping to structure the interim
government. However, to date, the interim government's specific
authorities and responsibilities remain undefined. In addition, the
electoral law for the National Assembly is to be completed before June 30,
2004, according to U.S. officials. Without an electoral law, the National
Assembly cannot be formed. Finally, according to State Department and DOD
officials, the transitional law and U.N. Security Council Resolution 1511
authorize the multinational force to operate in Iraq after June 30, and a
new resolution may further define its role. However, the Secretary of
State said in mid-May that if the Iraqi interim government asked the
multinational force to leave, the force would leave. He did not expect
this to happen. Although there are many difficult issues to be resolved,
U.S. government and Iraq Governing Council officials, along with the
United Nations, have only until June 30 to complete the work needed to
ensure a smooth transition.

The transitional law contains some provisions addressing two of the key
challenges facing the interim and transitional governments-maintaining a
unified Iraq and

ensuring its security-but many issues remain open. The law recognizes the
Kurdistan Regional Government and gives it control of territories in six
governorates that it controlled before the war in Iraq. Since two-thirds
of the voters in any three governorates can reject any draft constitution,
Kurdistan or any three governorates could have significant influence on
Iraq's political unity. The transitional law also recognizes the need to
structure Iraq security forces as the country strives to form a unified
permanent government, but does not fully detail how this will occur. For
example, coalition and Iraqi officials are still working out the command
and control structure of Iraqi security forces under the Ministry of the
Interior. In addition, the transitional law does not establish mechanisms
to disband or integrate militias into Iraq's security forces. If not
resolved before June 30, the issue will be left to Iraq's interim or
transitional government to address.

We are sending copies of this letter to interested congressional
committees. The letter is also available on GAO's home page at
http://www.gao.gov. If you or your staff have questions, please contact me
at (202) 512-8979 or [email protected]. Key contributors to this report
included Tetsuo Miyabara, Judith McCloskey, Valerie Nowak, Mary Moutsos,
Lynn Cothern, Robert Ball, Julie Chao, David Hancock, and Stephanie
Robinson.

Joseph A. Christoff
Director
International Affairs and Trade

(320263)

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