    [Public Papers of the Presidents of the United States: William J. Clinton (1994, Book II)]
    [October 3, 1994]
    [Pages 1681-1682]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Message to the Congress Reporting on the Unblocking of
    Panamanian Government Assets
    October 3, 1994

    To the Congress of the United States:
        1. I hereby report to the Congress on developments since the last
    Presidential report on November 9, 1993, which have resulted in the
    termination of the continued blocking of Panamanian government assets.
    This is the final report with respect to Panama pursuant to section

    [[Page 1682]]

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

                                                          William J. Clinton

    The White House,
    October 3, 1994.