[Public Papers of the Presidents of the United States: William J. Clinton (1998, Book II)]
[November 16, 1998]
[Pages 2040-2041]
[From the U.S. Government Publishing Office www.gpo.gov]



Letter to Congressional Leaders Reporting on the National Emergency With 
Respect to Iran
November 16, 1998

Dear Mr. Speaker:  (Dear Mr. President:)
    I hereby report to the Congress on developments since the last 
Presidential report of May 13, 1998, concerning the national emergency 
with respect to Iran that was declared in Executive Order 12170 of 
November 14, 1979. This report is submitted pursuant to section 204(c) 
of the International Emergency Economic Powers Act, 50 U.S.C. 
1703(c)(IEEPA). This report covers events through September 30, 1998. My 
last report, dated May 13, 1998, covered events through March 31, 1998.
    1. There have been no amendments to the Iranian Assets Control 
Regulations, 31 CFR Part 535 (the ``IACR''), since my last report.
    2. The Iran-United States Claims Tribunal (the ``Tribunal''), 
established at The Hague pursuant to the Algiers Accords, continues to 
make progress in arbitrating the claims before it. Since the period 
covered in my last report, the Tribunal has rendered three awards. This 
brings the total number of awards rendered by the Tribunal to 588, the 
majority of which have been in favor of U.S. claimants. As of September 
30, 1998, the value of awards to successful U.S. claimants paid from the 
Security Account held by the NV Settlement Bank was $2,501,515,655.22.
    Since my last report, Iran has failed to replenish the Security 
Account established by the Algiers Accords to ensure payment of awards 
to successful U.S. claimants. Thus, since November 5, 1992, the Security 
Account has continuously remained below the $500 million balance 
required by the Algiers Accords. As of September 30, 1998, the total 
amount in the Security Account was $107,563,705.15, and the total amount 
in the Interest Account was $26,226,833.16. Therefore, the United States 
continues to pursue Case No. A/28, filed in September 1993, to require 
Iran to meet its obligation under the Algiers Accords to replenish the 
Security Account.

[[Page 2041]]

    The United States also continues to pursue Case No. A/29 to require 
Iran to meet its obligation of timely payment of its equal share of 
advances for Tribunal expenses when directed to do so by the Tribunal.
    3. The Department of State continues to present other United States 
Government claims against Iran and to respond to claims brought against 
the United States by Iran, in coordination with concerned government 
agencies.
    On April 20, 1998, the United States filed a major submission in 
Case No. B/1, a case in which Iran seeks repayment for alleged wrongful 
charges to Iran over the life of its Foreign Military Sales (FMS) 
program, including the costs of terminating the program. The April 
filing addressed liability for the costs arising out of termination of 
the FMS program.
    Under the February 22, 1996, settlement agreement related to the 
Iran Air case before the International Court of Justice and Iran's bank-
related claims against the United States before the Tribunal (see report 
of May 16, 1996), the Department of State has been processing payments. 
As of September 30, 1998, the Department has authorized payment to U.S. 
nationals totaling $17,521,261.89 for 55 claims against Iranian banks. 
The Department has also authorized payments to surviving family members 
of 228 Iranian victims of the aerial incident, totaling $56,550,000.
    On June 5, 1998, the full Tribunal issued an award in Case No. A/27. 
The Tribunal held that, because of decisions of a United States District 
Court and Court of Appeals declining to enforce the Tribunal's July 1988 
award to Iran in Avco v. Iran, the United States violated its obligation 
under the Algiers Accords to ensure that Tribunal awards be treated as 
binding.
    On June 17, 1998, the Tribunal issued an order in Case No. B/61, in 
which Iran seeks compensation for the alleged non-transfer of certain 
military property. The order dismissed certain claims on grounds that 
they were duplicative of claims in other cases.
    In Case No. A/30, a case in which Iran alleges that the United 
States has violated paragraphs 1 and 10 of the General Declaration of 
the Algiers Accords, based on an alleged covert action program aimed at 
Iran and U.S. sanctions, the United States and Iran filed submissions in 
response to Iran's request that the Tribunal require the United States 
to produce classified intelligence information.
    4. U.S. nationals continue to pursue claims against Iran at the 
Tribunal. Since my last report, the Tribunal has issued awards in two 
private claims. On July 2, 1998, Chamber Two issued an award in Kamran 
Hakim v. Iran, AWD No. 587-953-2, ordering Iran to pay the claimant 
$691,611 plus interest as compensation for measures that deprived the 
claimant of his interest in a company he had established. The Tribunal 
dismissed claims regarding parcels of real property on grounds that, in 
certain instances, the claimant failed to prove expropriation or other 
measures affecting property rights, and failed in other instances to 
prove ownership.
    On July 8, 1998, Chamber One issued an award in Brown & Root, Inc. 
v. Iran, AWD No. 588-432-1, giving effect to a settlement agreement 
between the parties, ordering Iran to pay the claimant $16,718,214.
    5. The situation reviewed above continues to implicate important 
diplomatic, financial, and legal interests of the United States and its 
nationals and presents an unusual challenge to the national security and 
foreign policy of the United States. The Iranian Assets Control 
Regulations issued pursuant to Executive Order 12170 continue to play an 
important role in structuring our relationship with Iran and in enabling 
the United States to implement properly the Algiers Accords. I shall 
continue to exercise the powers at my disposal to deal with these 
problems and will continue to report periodically to the Congress on 
significant developments.

                                                      William J. Clinton

The White House,

November 16, 1998.

Note: Identical letters were sent to Newt Gingrich, Speaker of the House 
of Representatives, and Albert Gore, Jr., President of the Senate.