[Weekly Compilation of Presidential Documents Volume 31, Number 20 (Monday, May 22, 1995)]
[Pages 852-853]
[Online from the Government Publishing Office, www.gpo.gov]
<R04>
Message to the Congress on Iran
May 18, 1995
To the Congress of the United States:
I hereby report to the Congress on developments since the last
Presidential report on November 18, 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 April 18, 1995. It discusses only matters
concerning the national emergency with respect to Iran that was declared
in Executive Order No. 12170 and matters relating to Executive Order No.
12613. Matters relating to the March 15, 1995, Executive Order regarding
a ban on investment in the petroleum sector, and the May 6, 1995,
Executive Order regarding new trade sanctions, will be covered in
separate reports. My last report, dated November 18, 1994, covered
events through October 18, 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 (``OFAC'') 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. OFAC 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. However, since my
last report, the Tribunal has not rendered any awards although payments
were received by claimants in late November for awards rendered during
the prior reporting period. Thus, the total number of awards remains at
557. Of this total, 373 have been awards in favor of American claimants.
Two hundred twenty-five (225) 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, three approved the withdrawal of cases and 56 were in favor of
Iranian claimants. As of April 18, 1995, 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
$2,365,160,410.39.
Iran has not replenished the Security Account since October 8, 1992,
and the Account has remained continuously below the balance of $500
million required by the Algiers Accords since November 5, 1992. As of
April 10, 1995, the total amount in the Security Account was
$191,219,759.23, and
[[Page 853]]
the total amount in the Interest Account was $24,959,218.79.
The United States continues to pursue Case A/28, filed in September
1993, to require Iran to meet its obligations under the Algiers Accords
to replenish the Security Account. Iran has yet to file its Statement of
Defense in that case.
4. 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.
On April 18, 1995, the United States filed the first of two parts of
its consolidated submission on the merits in Case B/61. Case B/61
involves a claim by Iran for compensation with respect to primarily
military equipment that Iran alleges it did not receive. The equipment
was purchased pursuant to commercial contracts with more than 50 private
American companies. Iran alleges that it suffered direct losses and
consequential damages in excess of $2 billion in total because of the
U.S. Government's refusal to allow the export of the equipment after
January 19, 1981, in alleged contravention of the Algiers Accords. As
directed by the Tribunal, the United States' submission addresses Iran's
claims regarding both liability and compensation and damages.
5. The Foreign Claims Settlement Commission (``FSCS'') on February
24, 1995, successfully completed its case-by-case review of the more
than 3,000 so-called ``small claims'' against Iran arising out of the
1979 Islamic revolution. These ``small claims'' (of $250,000 or less
each) were originally filed before the Iran-United States Claims
Tribunal, but were transferred to the FCSC pursuant to the May 13, 1990
Settlement Agreement between Iran and the United States.
The FCSC issued decisions on 3,066 claims for total awards of
$86,555,795. Of that amount, $41,570,936 represented awards of principal
and $44,984,859 represented awards of interest. Although originally only
$50 million were available to pay these awards, the funds earned
approximately $9 million in interest over time, for a total settlement
fund of more than $59 million. Thus, all awardees will receive full
payment on the principal amounts of their awards, with interest awards
paid on a pro rata basis.
The FCSC's awards to individuals and corporations covered claims for
both real and personal property seized by Iran. In addition, many claims
arose out of commercial transactions, including contracts for the sale
of goods and contracts for the supply of services such as teaching,
medical treatment, data processing, and shipping. The FCSC is now
working with the Department of the Treasury to facilitate final payment
on all FCSC awards.
6. 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
combating 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.
William J. Clinton
The White House,
May 18, 1995.