House Passes Bill to Impose Additional Sanctions on Iran
On December 15, 2009, the House of Representatives passed H.R. 2194, the "Iran Refined Petroleum Sanctions Act of 2009" by a vote of 412-12. The bill would amend the Iran Sanctions Act (50 U.S.C. 1701) to expand the sanctions imposed against Iran. Highlights of H.R. 2194 include the following:
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
Sanctions against those supplying Iran with refined petroleum products. H.R. 2194would direct the President to impose sanctions if he determines that a person has provided Iran with refined petroleum products; provided ships, vehicles, or other means of transportation to deliver refined petroleum products to Iran; has provided services related to the shipping or other transportation of refined petroleum products to Iran; has underwritten or otherwise provided insurance or reinsurance for shipping or transportation activities; or financed or brokered shipping or transportation activities. Sanctions would be imposed if the value of such products, goods, services, technology, information, or support exceeds $200,000 (or $500,000 in any 12-month period).
Requirements for federal contractors. The bill would place new requirements on federal contractors and would require the heads of federal executive agencies to ensure that contracts for the procurement of goods or services, or agreements for the use of federal funds as part of a grant, loan, or loan guarantee, include a clause requiring the contractor to certify that it does not conduct any of the prohibited activity described above. If it is determined that a federal contractor engaged in prohibited activity, the federal agency may terminate the contract or agreement or debar or suspend the contractor from eligibility for federal contracts for up to 15 years.
Lower investment threshold for sanctions. The bill would also lower the investment threshold from $40 million to $20 million per year for the imposition of sanctions against persons (defined to mean either individuals or companies) that have made an investment that directly and significantly contributes to Iran's ability to develop its petroleum resources.1 The threshold for a combination of investments during any 12-month period would also be lowered to $5 million per investment and $20 million per year from $10 million per investment and $40 million per year.
Additional sanctions possible. The bill would allow the President to impose additional sanctions under the Iranian Sanctions Act, including:
Prohibiting transactions in foreign exchange;
Prohibiting transfers of credit or payments between, by, through, to any financial institution;
Prohibiting any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation, or exportation of, dealing in, or exercising any right, power, or privilege with respect to, or transactions involving any property subject to the jurisdiction of the United States.
Sponsor Open to Certain Amendments After Senate Passes its Iran Sanctions Bill
During debate on the bill on the House floor prior to the final vote on the legislation, Representative Howard Berman (D-CA) stated that he would consider making changes to the legislation during House/Senate conference committee negotiations once the Senate passes its version of the bill that would make the bill "as effective as possible to prevent Iran from developing nuclear weapons."
Representative Berman said possible changes could include providing incentives to other nations to join the U.S. in supporting a strong, multilateral sanctions regime, such as providing an exemption for companies whose host nations are already enforcing robust sanctions in their national laws.
Administration Asks Senate to Postpone Considering Its Iran Sanctions Bill
The Obama Administration, in a letter from the State Department to Senator John Kerry (D-MA), Chairman of the Senate Foreign Relations Committee, has expressed concerns with both the timing of consideration of Iran Sanctions legislation and the content of the legislation. Specifically, the Administration asked the Senate to postpone consideration of its Iran Sanctions bill until 2010 to allow the Administration to pursue diplomatic efforts in the near term. The letter also raised concerns with the lack of flexibility in the legislation, inefficient monetary thresholds and penalty levels, and blacklisting that could cause unintended foreign policy consequences.
2 Petroleum resources include petroleum, oil, or liquefied natural gas; oil or liquefied natural gas tankers; and products used to construct or maintain pipelines used to transport oil or compressed or liquefied natural gas.
See ITT's Online Archives or 11/04/09 news, 09110415, for BP summary of House and Senate reporting of Iran Sanctions bills.
The text of H.R. 2194 as passed by the House is available at:http://www.thomas.gov/cgi-bin/query/C?c111:./temp/c111MYNgBA.
House debate and letter to Senator Kerry, at: http://frwebgate1.access.gpo.gov/cgi-bin/PDFgate.cgi?WAISdocID=981883101000020&WAISaction=retrieve