    [Weekly Compilation of Presidential Documents Volume 30, Number 46 (Monday, November 21, 1994)]
    [Pages 2412-2414]
    [Online from the Government Publishing Office, www.gpo.gov]

    <R04>
    Letter to Congressional Leaders on Iran

    November 18, 1994

    Dear Mr. Speaker:  (Dear Mr. President:)

        I hereby report to the Congress on developments since the last
    Presidential report on May 14, 1994, concerning the national emergency
    with respect to Iran that was declared in Executive Order No. 12170 of
    November 14, 1979, and matters relating to Executive Order No. 12613 of
    October 29, 1987. This report is submitted pursuant to section 204(c) of
    the International Emergency Economic Powers Act, 50 U.S.C. 1703(c), and
    section 505(c) of the International Security and Development Cooperation
    Act of 1985, 22 U.S.C. 2349aa-9(c). This report covers events through
    October 18, 1994. My last report, dated May 14, 1994, covered events
    through March 31, 1994.
        1. There have been no amendments to the Iranian Transactions
    Regulations, 31 CFR Part 560, or to the Iranian Assets Control
    Regulations, 31 CFR Part 535, since the last report.
        2. The Office of Foreign Assets Control (FAC) of the Department of
    the Treasury continues to process applications for import licenses under
    the Iranian Transactions Regulations. However, a substantial majority of
    such applications are determined to be ineligible for licensing and,
    consequently, are denied.
        During the reporting period, the U.S. Customs Service has continued
    to effect numerous seizures of Iranian-origin merchandise, primarily
    carpets, for violation of the import prohibitions of the Iranian
    Transactions Regulations. The FAC and Customs Service investigations of
    these violations have resulted in forfeiture actions and the imposition
    of civil monetary penalties. Additional forfeiture and civil penalty
    actions are under review.
        3. 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 my last report,
    the Tribunal has rendered 6 awards, bringing the total number to 557. Of
    this total, 373 have been awards in favor of American claimants. Two
    hundred twenty-five of these were awards on agreed terms, authorizing
    and approving payment of settlements negotiated by the parties, and 150
    were decisions adjudicated on the merits. The Tribunal has issued 38
    decisions dismissing claims on the merits and 85 decisions dismissing
    claims for jurisdictional reasons. Of the 59 remaining awards, 3
    approved the withdrawal of cases and 56 were in favor of Iranian
    claimants. As of October 18, 1994, the Federal Reserve Bank of New York
    reported that the value of awards to successful American claimants from
    the Security Account held by the NV Settlement Bank stood at
    $2,353,030,872.61.
        The Security Account has fallen below the required balance of $500
    million almost 50 times. Until October 1992, Iran periodically
    replenished the account, as required by the Algiers Accords. This was
    accomplished first by transfers from the separate account held

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    by the NV Settlement Bank in which interest on the Security Account is
    deposited. The aggregate amount transferred from the Interest Account to
    the Security Account was $874,472,986.47. Iran then replenished the
    account with the proceeds from the sale of Iranian-origin oil imported
    into the United States, pursuant to transactions licensed on a case-by-
    case basis by FAC. Iran has not, however, replenished the account since
    the last oil sale deposit on October 8, 1992, although the balance fell
    below $500 million on November 5, 1992. As of October 18, 1994, the
    total amount in the Security Account was $203,349,297.01 and the total
    amount in the Interest Account was $20,160,414.78.
        The United States continues to pursue Case A/28, filed last year, to
    require Iran to meet its financial obligations under the Algiers Accords
    to replenish the Security Account.
        4. Since my last report, the Tribunal has issued two significant
    awards in favor of U.S. citizens who are dual nationals, for their
    respective shares of corporations expropriated by Iran. The Tribunal
    awarded members of the Khosrowshahi family $2,484,746.31 plus interest.
    The Tribunal awarded members of the Ebrahimi family $5,265,697.00 plus
    interest.
        5. The Department of State continues to present United States
    Government claims against Iran, in coordination with concerned
    government agencies, and to respond to claims brought against the United
    States by Iran. In July 1994, the United States filed a new case, Number
    A/29, seeking to compel Iran to make its payments for Tribunal expenses
    in a timely manner. Over the past 2 years, Iran has failed repeatedly to
    make its payments for extended periods of time, until pressed by the
    United States in Cases A/28 and A/29.
        The United States also recently filed its Rejoinders in,
    respectively, Case A/15 (I:D and I:H), a claim brought by Iran for the
    return of certain amounts held in U.S. banks, and Case A/27, a claim
    brought by Iran for the alleged failure of the United States to enforce
    a Tribunal award in its favor against a U.S. national.
        In August, the United States filed a Production Request in Case B/1,
    a case in which Iran alleges the United States is liable for termination
    costs and the nondelivery of goods and services under contracts through
    the Foreign Military Sales (FMS) program. The United States is seeking
    the return of FMS documents that remained in U.S. military offices in
    Iran after the Revolution.
        6. United States arbitrator Howard Holtzmann, one of the original
    members of the Tribunal, resigned July 31, 1994, after 13 years of
    service. To replace him, the United States appointed Charles T. Duncan,
    who assumed his duties on August 1, 1994. Until his appointment, Mr.
    Duncan was Senior Counsel to the law firm of Reid & Priest.
        7. As anticipated by the May 13, 1990, agreement settling the claims
    of U.S. nationals against Iran for less than $250,000, the Foreign
    Claims Settlement Commission (FCSC) has continued its review of 3,112
    claims. As of October 18, 1994, the FCSC has issued decisions in 3,066
    claims, for total awards of more than $68 million. The FCSC expects to
    complete its adjudication of the remaining claims this year.
        8. 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 No. 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.
    Similarly, the Iranian Transactions Regulations issued pursuant to
    Executive Order No. 12613 continue to advance important objectives in
    combatting international terrorism. 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.

        Sincerely,

                                                William J. Clinton

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

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