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H.R. 3107 (104th): Iran and Libya Sanctions Act of 1996

The text of the bill below is as of Mar 19, 1996 (Introduced).


HR 3107 IH

104th CONGRESS

2d Session

H. R. 3107

To impose sanctions on persons exporting certain goods or technology that would enhance Iran’s ability to explore for, extract, refine, or transport by pipeline petroleum resources, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

March 19, 1996

Mr. GILMAN (for himself, Mr. BERMAN, Mr. GEJDENSON, Mr. BURTON of Indiana, Mr. KING, Mr. SHAW, and Mr. FORBES) introduced the following bill; which was referred to the Committee on International Relations, and in addition to the Committees on Banking and Financial Services, Ways and Means, and Government Reform and Oversight, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned


A BILL

To impose sanctions on persons exporting certain goods or technology that would enhance Iran’s ability to explore for, extract, refine, or transport by pipeline petroleum resources, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ‘Iran Oil Sanctions Act of 1996’.

SEC. 2. FINDINGS.

    The Congress makes the following findings:

      (1) The efforts of the Government of Iran to acquire weapons of mass destruction and the means to deliver them and its support of international terrorism endanger potentially the national security and foreign policy interests of the United States and those countries with which it shares common strategic and foreign policy objectives.

      (2) The objective of preventing the proliferation of weapons of mass destruction and international terrorism through existing multilateral and bilateral initiatives requires additional efforts to deny Iran the financial means to sustain its nuclear, chemical, biological, and missile weapons programs.

      (3) The Government of Iran uses its diplomatic facilities and quasi-governmental institutions outside of Iran to promote acts of international terrorism and assist its nuclear, chemical, biological, and missile weapons programs.

SEC. 3. DECLARATION OF POLICY.

    The Congress declares that it is the policy of the United States to deny Iran the ability to support international terrorism and to fund the development and acquisition of weapons of mass destruction and the means to deliver them by limiting the development of Iran’s ability to explore for, extract, refine, or transport by pipeline petroleum resources of Iran.

SEC. 4. IMPOSITION OF SANCTIONS.

    (A) IN GENERAL- Except as provided in subsection (d), the President shall impose 2 or more of the sanctions described in paragraphs (1) through (5) of section 5 if the President determines that a person has, with actual knowledge or reason to know, on or after the date of the enactment of this Act--

      (1) exported, transferred, or released to Iran, nationals of Iran, or entities owned or controlled by Iran or nationals of Iran any goods or technology identified on the List of Petroleum and Natural Gas-Related Goods and Technology established under section 9 (in this Act referred to as the ‘List’) if the provision of such goods or technology would significantly and materially enhance Iran’s ability to develop petroleum resources of Iran--

        (A) whether or not the goods or technology is exported from the United States; and

        (B) whether or not the goods or technology is subject to the jurisdiction of the United States; or

      (2) made an investment of $40,000,000 or more (or any combination of investments of a least $10,000,000 each, which in the aggregate equals or exceeds $40,000,000 in any 12-month period), that directly contributed to the enhancement of Iran’s ability to develop petroleum resources of Iran.

    (b) PERSONS AGAINST WHICH THE SANCTIONS ARE TO BE IMPOSED- The sanctions described in subsection (a) shall be imposed on--

      (1) the person with respect to whom the President makes the determination subsection (a);

      (2) any successor entity to the person with respect to whom the President makes the determination subsection (a);

      (3) any wholly owned subsidiary of the person with respect to whom the President makes the determination subsection (a);

      (4) any other subsidiary of the person with respect to whom the President makes the determination under subsection (a) if that subsidiary, with actual knowledge or reason to know, engaged in the activities which were the basis of that determination;

      (5) any person that is a parent of the person with respect to whom the President makes the determination under subsection (a) if that parent had actual knowledge or reason to know of the activities which were the basis of that determination; and

      (6) any person that is an affiliate of the person with respect to whom the President makes the determination under subsection (a) if that affiliate, with actual knowledge or reason to know, engaged in the activities which were the basis of that determination.

    For purposes of this Act, any person or entity described in this subsection shall be referred to as a ‘sanctioned person’.

    (c) PUBLICATION IN FEDERAL REGISTER- The President shall cause to be published in the Federal Register a current list of sanctioned persons. The removal of names from, and the addition of names to, the list, shall also be so published.

    (d) EXCEPTIONS- The President shall not be required to apply or maintain the sanctions under subsection (a)--

      (1) in the case of procurement of defense articles or defense services--

        (A) under existing contracts or subcontracts, including the exercise of options for production quantities to satisfy requirements essential to the national security of the United States;

        (B) if the President determines in writing that the person to which the sanctions would otherwise be applied is a sole source supplier of the defense articles or services, that the defense articles or services are essential, and that alternative sources are not readily or reasonably available; or

        (C) if the President determines in writing that such articles or services are essential to the national security under defense coproduction agreements;

      (2) to products or services provided under contracts entered into before the date on which the President publishes his intention to impose the sanctions;

      (3) to--

        (A) spare parts which are essential to United States products or production;

        (B) component parts, but not finished products, essential to United States products or production; or

        (C) routine servicing and maintenance of products, to the extent that alternative sources are not readily or reasonably available;

      (4) to information and technology essential to United States products or production; or

      (5) to medicines, medical supplies, or other humanitarian items.

SEC. 5. DESCRIPTION OF SANCTIONS.

    The sanctions to be imposed on a sanctioned person under section 4(a) are as follows:

      (1) EXPORT-IMPORT BANK ASSISTANCE FOR EXPORTS TO SANCTIONED PERSONS- The President shall direct the Export-Import Bank of the United States not to guarantee, insure, extend credit, or participate in the extension of credit in connection with the export of any goods or services to any sanctioned person.

      (2) TRADE SANCTION- The President shall both--

        (A) order the United States Government not to issue any specific license and not to grant any other specific permission or authority to export any goods or technology to a sanctioned person under--

          (i) the Export Administration Act of 1979;

          (ii) the Arms Export Control Act;

          (iii) the Atomic Energy Act of 1954; or

          (iv) any other statute that requires the prior review and approval of the United States Government as a condition for the export or re-export of goods or services; and

        (B) prohibit the importation into the United States of products produced by any sanctioned person.

      Subparagraph (B) includes application to the importation of any finished product or component part, whether shipped directly by the sanctioned person or by another entity.

      (3) LOANS FROM UNITED STATES FINANCIAL INSTITUTIONS- The United States Government shall prohibit any United States financial institution from making any loan or providing any credit to any sanctioned person in an amount exceeding $10,000,000 (or two or more loans of more than $5,000,000 each in any 12-month period) unless such person is engaged in activities to relieve human suffering and the loan, loans, or credit is provided for such activities.

      (4) PROHIBITIONS ON FINANCIAL INSTITUTIONS- The following prohibitions shall be imposed against a sanctioned person that is a financial institution:

        (A) DESIGNATION AS PRIMARY DEALER- Neither the Board of Governors of the Federal Reserve System nor the Federal Reserve Bank of New York may designate, or permit the continuation of any prior designation of, such financial institution as a primary dealer in United States Government debt instruments.

        (B) GOVERNMENT FUNDS- Such financial institution shall not serve as agent of the United States Government or serve as repository for United States Government funds.

      (5) PROCUREMENT SANCTION- The United States Government shall not procure, or enter into any contract for the procurement of, any goods or services from a sanctioned person.

SEC. 6. ADVISORY OPINIONS.

    The Secretary of State may, upon the request of any person, issue an advisory opinion to that person as to whether a proposed activity by that person would subject that person to sanctions under this Act. Any person who relies in good faith on such an advisory opinion which states that the proposed activity would not subject a person to much sanctions, and any person who thereafter engages in such activity, may not be made subject to such sanctions on account of such activity.

SEC. 7. TERMINATION OF SANCTIONS.

    The requirement under section 4 to impose sanctions shall no longer have force or effect if the President determines and certifies to the appropriate congressional committees that Iran--

      (1) has ceased its efforts to design, develop, manufacture, or acquire--

        (A) a nuclear explosive device or related materials and technology;

        (B) chemical and biological weapons; and

        (C) ballistic missiles and ballistic missile launch technology; and

      (2) has been removed from the list of countries the governments of which have been determined, for purposes of section 6(j) of the Export Administration Act of 1979, to have repeatedly provided support for acts of international terrorism.

SEC. 8. DURATION OF SANCTIONS; PRESIDENTIAL WAIVER.

    (a) Delay of Sanctions-

      (1) CONSULTATIONS- If the President makes a determination described in section 4(a) with respect to a foreign person, the Congress urges the President to initiate consultations immediately with the

government with primary jurisdiction over that foreign person with respect to the imposition of sanctions under this Act.

      (2) ACTIONS BY GOVERNMENT OF JURISDICTION- In order to pursue such consultations with the government, the President may delay imposition of sanctions under this Act for up to 90 days. Following such consultation, the President shall immediately impose sanctions unless the President determines and certifies to the Congress that the government has taken specific and effective actions, including, as appropriate, the imposition of appropriate penalties, to terminate the involvement of the foreign person in the activities that resulted in the determination by the President under section 4(a) concerning such person.

      (3) ADDITIONAL DELAY IN IMPOSITION OF SANCTIONS- The President may delay the imposition of sanctions for up to an additional 90 days if the President determines and certifies to the Congress that the government with primary jurisdiction over the process of taking the actions described in paragraph (2).

      (4) REPORT TO CONGRESS- Not later than 45 days after making a determination under section 4(a), the President shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on International Relations of the House of Representatives a report on the status of consultations with the appropriate foreign government under this subsection, and the basis for any determination under paragraph (3).

    (b) DURATION OF SANCTIONS- The requirement to impose sanctions under section 4(a) shall remain in effect until the President determines that the sanctioned person is no longer engaging in the activity that led to the imposition of sanctions.

    (c) Presidential Waiver-

      (1) AUTHORITY- The President may waive the requirement in section 4(a) to impose a sanction or sanctions on a person in section 4(b), and may waive the continued imposition of a sanction or sanctions under subsection (b) of this section, 30 days or more after the President determines and so reports to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on International Relations of the House of Representatives that it is important to the national interest of the United States to exercise such waiver authority.

      (2) CONTENTS OF REPORT- Any such report shall provide a specific and detailed rationale for such determination, including--

        (A) a description of the conduct that resulted in the determination;

        (B) in the case of a foreign person, an explanation of the efforts to secure the cooperation of the government with primary jurisdiction of the sanctioned person to terminate or, as appropriate, penalize the activities that resulted in the determination;

        (C) an estimate as to the significance of the investment or the provision of the goods or technology, as the case may be, to Iran’s ability to develop its petroleum resources; and

        (D) a statement as to the response of the United States in the event that such person engages in other activities that would be subject to section 4(a).

      (3) EFFECT OF REPORT ON WAIVER- If the President makes a report under paragraph (1) with respect to a waiver of sanctions on a person in section 4(b), sanctions need not be imposed under section 4(a) on that person during the 30-day period referred to in paragraph (1).

SEC. 9. GOODS AND TECHNOLOGY SUBJECT TO EXPORT CONTROL RESTRICTIONS.

    (a) Control List-

      (1) CONTENTS OF LIST- For purposes of the determinations to be made under section 4(a), the President, in consultation with the Secretary of State and the Secretary of Energy, and the heads of other appropriate departments and agencies, shall establish and maintain the List of Petroleum and Natural Gas-Related Goods and Technology. The List shall consist of--

        (A) all items listed in the Annex to Resolution 883 of the Security Council of the United Nations, adopted November 11, 1993, and all types of equipment, supplies, and grants of licenses prohibited by paragraph 5 of that resolution; and

        (B) any other goods or technology (including software and technical data) that the President determines could significantly or materially contribute to Iran’s ability to develop its petroleum resources, including goods and technology that are required for the development, production, or use of facilities (including the repair, maintenance, or operation of equipment) for the development of petroleum resources.

      (2) PUBLICATION- The President, within 60 days after the date of the enactment of this Act, shall cause the List to be published in the Federal Register, together with any regulations issued with respect thereto. Thereafter, any revisions to the List or amendments to the regulations shall be published in the same manner.

      (3) ADVANCE NOTICE TO CONGRESS- Not less than 30 days in advance of the publication of the List, it shall be provided to the Committee on Banking, Housing, and Urban Affairs of the Senate and to the Committee on International Relations of the House of Representatives. The President shall consult with such Committee regarding the content of the List and shall respond to questions regarding the basis for the inclusion on, or exclusion from, the List of specified goods and technology.

    (b) STATUTORY CONSTRUCTION- Nothing in this section prevents the inclusion on the List of any goods or technology that may be produced in and traded internationally by persons or entities in countries other than the United States.

SEC. 10. REPORTS REQUIRED.

    (a) REPORT ON CERTAIN INTERNATIONAL INITIATIVES- Not later than 6 months after the date of the enactment of this Act, and every 6 months thereafter, the President shall transmit a report to the appropriate congressional committees describing--

      (1) the efforts of the President to mount a multilateral campaign to persuade all countries to pressure Iran to cease its weapons of mass destruction programs and its support of international terrorism;

      (2) the efforts of the President to persuade other governments to ask Iran to reduce the presence of Iranian diplomats and representatives of other government and military or quasi-governmental institutions of Iran and to withdraw any such diplomats or representatives who participated in the takeover of the United States embassy in Tehran on November 4, 1979, or the subsequent holding of United States hostages for 444 days;

        (3) the extent to which the International Atomic Energy Agency has established regular inspections of all nuclear facilities in Iran, including those presently under construction; and

      (4) Iran’s use of Iranian diplomats and representatives of other government and military or quasi-governmental institutions of Iran to promote acts of terrorism or to develop or sustain Iran’s nuclear, chemical, biological, and missile weapons programs.

    (b) OTHER REPORTS- The President shall ensure the continued transmittal to the Congress of reports describing--

      (1) the nuclear and other military capabilities of Iran, as required by section 601(a) of the Nuclear Non-Proliferation act of 1978 and section 1607 of the National Defense Authorization Act, Fiscal Year 1993; and

      (2) the support provided by Iran for acts of international terrorism, as part of the Department of State’s annual report on international terrorism.

SEC. 11. APPLICATION OF THE ACT TO LIBYA.

    (a) IN GENERAL- The sanctions of this Act, including the terms and conditions for the imposition, duration, and termination of sanctions, shall apply to persons making investments with respect to the development of petroleum resources of Libya, or exporting, transferring, or releasing of certain goods or technology to Libya, nationals of Libya, or entities owned or controlled by Libya, in the same manner as those sanctions apply under this Act to persons making investments with respect to the development of petroleum resources of Iran, or exporting, transferring, or releasing of certain goods or technology to Iran, nationals of Iran, or entities owned or controlled by Iran.

    (b) APPLICATION OF SPECIFIC PROVISIONS- In applying the provisions of this Act with respect to Libya under subsection (a) each reference to ‘Iran’ shall be deemed to be a reference to ‘Libya’.

SEC. 12. DETERMINATIONS NOT REVIEWABLE.

    A determination to impose sanctions under this Act shall not be reviewable in any court.

SEC. 13. DEFINITIONS.

    As used in this Act:

      (1) ACT OF INTERNATIONAL TERRORISM- The term ‘act of international terrorism’ means an act--

        (A) which is violent or dangerous to human life and that is a violation of the criminal laws of the United States or of any State or that would be a criminal violation if committed within the jurisdiction of the United States or any State; and

        (B) which appears to be intended--

          (i) to intimidate or coerce a civilian population;

          (ii) to influence the policy of a government by intimidation or coercion; or

          (iii) to affect the conduct of a government by assassination or kidnapping.

      (2) AFFILIATE- For purposes of section 4(b), a person is an ‘affiliate’ of another person if more than 50 percent of the outstanding capital stock or other beneficial interest in both persons is owned by a third person or both persons are otherwise controlled by a third person.

      (3) APPROPRIATE CONGRESSIONAL COMMITTEES- The term ‘appropriate congressional committees’ means the Committees on Banking, Housing, and Urban Affairs and Foreign Relations of the Senate and the Committee on International Relations of the House of Representatives.

      (4) COMPONENT PART- The term ‘component part’ has the meaning given that term in section 11A(e)(1) of the Export Administration Act of 1979 (50 U.S.C. App. 2410a(e)(1)).

      (5) DEVELOP AND DEVELOPMENT- To ‘develop’, or the ‘development’ of, petroleum resources means the exploration for, or the extraction, refining, or transportation by pipeline of, petroleum resources.

      (6) FINANCIAL INSTITUTION- The term ‘financial institution’ includes--

        (A) a depository institution (as defined in section 3(c)(1) of the Federal Deposit Insurance Act), including a branch or agency of a foreign bank (as defined in section 1(b)(7) of the International Banking Act of 1978);

        (B) a credit union;

        (C) a securities firm, including a broker or dealer;

        (D) an insurance company, including an agency or underwriter;

        (E) any other company that provides financial services; and

        (F) any subsidiary of an entity described in any of subparagraphs (A) through (E).

      (7) FINISHED PRODUCT- The term ‘finished product’ has the meaning given that term in section 11A(e)(2) of the Export Administration Act of 1979 (50 U.S.C. App. 2410a(e)(2)).

      (8) FOREIGN PERSON- The term ‘foreign person’ means--

        (A) an individual who is not a United States person or an alien lawfully admitted for permanent residence into the United States; or

        (B) a corporation, partnership, or other nongovernment entity which is not a United States person.

      (9) GOODS AND TECHNOLOGY- The terms ‘goods’ and ‘technology’ have the meanings given those terms in section 16 of the Export Administration Act of 1979 (50 U.S.C. app. 2415).

      (10) INVESTMENT- The term ‘investment’ means--

        (A) the entry into a contract that includes responsibility for the development of petroleum resources located in Iran or Libya (as the case may be), or the entry into a contract providing for the general supervision and guarantee of anther person’s performance of such a contract;

        (B) the purchase of a share of ownership in that development;

        (C) the entry into a contract providing for the participation in royalties, earnings, or profits in that development, without regard to the form of the participation; or

        (D) the entry into or performance of--

          (i) a contract for the financing of the development of petroleum resources located in Iran or Libya (as the case may be); or

          (ii) a guaranty of another person’s performance under such a contract.

      (11) IRAN- The term ‘Iran’ means--

        (A) the territory of Iran; and

        (B) any territory or marine areas over which the Government of Iran claims sovereignty, sovereign rights, or jurisdiction, if the Government of Iran exercises partial or de facto control over such territory or areas or derives a benefit from economic activity in the territory or area pursuant to an international agreement.

      (12) IRANIAN DIPLOMATS AND REPRESENTATIVES OF OTHER GOVERNMENT AND MILITARY OR QUASI-GOVERNMENTAL INSTITUTIONS OF IRAN- The term ‘Iranian diplomats and representatives of other government and military or quasi-governmental institutions of Iran’ includes employees, representatives, or affiliates of Iran’s--

        (A) Foreign Ministry;

        (B) Ministry of Intelligence and Security;

        (C) Revolutionary Guard Corps;

        (D) Crusade for Reconstruction;

        (E) Qods (Jerusalem) Forces;

        (F) Interior Ministry;

        (G) Foundation for the Oppressed and Disabled;

        (H) Prophet’s Foundation;

        (I) June 5th Foundation;

        (J) Martyr’s Foundation;

        (K) Islamic Propagation Organization; and

        (L) Ministry of Islamic Guidance.

      (13) LIBYA- The term ‘Libya’ means--

        (A) the territory of Libya; and

        (B) any territory or marine areas over which the Government of Libya claims sovereignty, sovereign rights, or jurisdiction, if the Government of Libya exercises partial or de facto control over such territory or area or derives a benefit from economic activity in the territory or area pursuant to an international agreement.

      (14) NUCLEAR EXPLOSIVE DEVICE- The term ‘nuclear explosive device’ means any device, whether assembled or disassembled, that is designed to produce an instantaneous release of an amount of nuclear energy from special nuclear material (as defined in section 11aa. of the Atomic Energy Act of 1954) that is greater than the amount of energy that would be released from the detonation of one pound of trinitrotoluene (TNT).

      (15) PARENT- For purposes of section 4(b), a person is a ‘parent’ of another person if that person owns, directly or indirectly, more than 50 percent of the outstanding capital stock or other beneficial interest in that other person, or otherwise controls that other person.

      (16) PERSON- The term ‘person’ means a natural person as well as a corporation, business association, partnership, society, trust, any other nongovernmental entity, organization, or group, and any governmental entity operating as a business enterprise, and any successor to any such entity.

      (18) PETROLEUM RESOURCES- The term ‘petroleum resources’ includes petroleum and natural gas resources.

      (19) SUBSIDIARY- (A) For purposes of section 4(b), and subject to subparagraph (B), a person is a ‘subsidiary’ of another person if that other person owns, directly or indirectly, more than 50 percent of the outstanding capital stock or other beneficial interest in that person, or otherwise controls that person.

      (B) A person is a ‘wholly owned’ subsidiary of another person if all the outstanding capital stock or other beneficial interests of that person are owned by that other person.

      (20) UNITED STATES OR STATE- The term ‘United States’ or ‘State’ means the several States, the District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands, American Samoa, Guam, the United States Virgin Islands, and any other territory or possession of the United States.

      (21) UNITED STATES PERSON- The term ‘United States person’ means--

        (A) a natural person who is a citizen of the United States or who owes permanent allegiance to the United States; and

        (B) a corporation or other legal entity which is organized under the laws of the United States, any State or territory thereof, or the District of Columbia, if natural persons described in subparagraph (A) own, directly or indirectly, more than 50 percent of the outstanding capital stock or other beneficial interest in such legal entity.