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107th Congress, 2d Session - - - - - - - - - - - - House Document 107-188


 
               PERIODIC REPORT ON THE NATIONAL EMERGENCY


                         WITH RESPECT TO IRAN

                               __________

                             COMMUNICATION

                                  From

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

  A 6-MONTH PERIODIC REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO 
  IRAN THAT WAS DECLARED IN EXECUTIVE ORDER 12957 OF MARCH 15, 1995, 
PURSUANT TO 50 U.S.C. 1641(c); 50 U.S.C. 1730(c); 22 U.S.C. 2349aa-9(c)

<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>


 March 13, 2002.--Referred to the Committee on International Relations 
                       and ordered to be printed
To the Congress of the United States:
    As required by section 401(c) of the National Emergencies 
Act, 50 U.S.C. 1641(c), 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), I transmit 
herewith a 6-month periodic report prepared by my 
Administration on the national emergency with respect to Iran 
that was declared in Executive Order 12957 of March 15, 1995.

                                                    George W. Bush.
    The White House, March 13, 2002.
     Periodic Report on the National Emergency With Respect to Iran

    This report to the Congress presents developments over the 
course of the past 6 months concerning the national emergency 
with respect to Iran that was declared in Executive Order 12957 
of March 15, 1995, as added to in Executive Order 12959 of May 
6, 1995, and clarified in Executive Order 13059 of August 19, 
1997. This report is submitted pursuant to section 204(c) of 
the International Emergency Economic Powers Act, 50 U.S.C. 
1703(c) (``IEEPA''), section 401(c) of the National Emergencies 
Act, 50 U.S.C. 1641(c), and section 505(c) of the International 
Security and Development Cooperation Act of 1985, 22 U.S.C. 
2349aa-9(c). This report discusses only matters concerning the 
national emergency with respect to Iran that was declared in 
Executive Order 12957 and does not deal with those relating to 
the emergency declared on November 14, 1979, in connection with 
the hostage crisis.
    1. During the current reporting period, the Department of 
the Treasury's Office of Foreign Assets Control (OFAC) made 
numerous decisions with respect to applications for licenses to 
engage in transactions under the Regulations. Of those 
applications for licenses that were denied, the majority were 
for requests to authorize commercial exports to Iran--
particularly of machinery and equipment for various 
industries--and the importation of Iranian-origin goods. 
Ninety-six licenses were issued, of which 33 authorized 
commercial sales and exportation to Iran of bulk agricultural 
commodities. In addition, 41 licenses were also issued 
authorizing sales of medicines or medical equipment. Other 
licenses issued authorized certain licensable transactions 
involving commercial transactions made pursuant to contracts 
executed prior to the imposition of sanctions, the provision of 
international Internet access service, scientific workshops, 
the importation of art objects for public exhibition, and 
transactions relating to the transshipment of agricultural 
products destined for Afghanistan under the auspices of the 
United Nations, as well as other transactions ultimately 
related to the humanitarian efforts in Afghanistan. Pursuant to 
Sections 3 and 4 of Executive Order 12959 and Executive Order 
13059 and consistent with statutory restrictions concerning 
certain goods and technology, including those involved in air 
safety cases, Treasury continues to consult with the 
Departments of State and Commerce in the issuance of licenses.
    2. For the period September 15, 2001, through March 14, 
2002, on OFAC's instructions, U.S. banks refused to process 
approximately 500 commercial transactions, the majority 
involving foreign financial institutions. The completion of 
these transactions by U.S. banks would have been contrary to 
U.S. foreign policy with respect to Iran. The rejected 
transactions caused a disruption of approximately $271 million 
in financial dealings involving Iran by virtue of U.S. economic 
sanctions.
    3. Since the last report, OFAC has collected 19 civil 
monetary penalties, settlements, and installment payments 
totaling more than $200,000 for violations of IEEPA and the 
Regulations. The violators included seven companies, four U.S. 
financial institutions, one carrier, and one individual. An 
additional 175 cases are undergoing penalty action for 
violations of the Regulations and IEEPA. In addition, criminal 
charges were filed in Phoenix and New York City in two separate 
cases involving the export of financial services to Iran. The 
indictments each allege that the defendants were involved in an 
illegal money transmitting operation by transferring funds from 
the United States to accounts maintained in banks in Iran via 
Dubai, U.A.E. The parties are not linked to any terrorist 
funding operations. Various other enforcement actions carried 
over from previous reporting periods are continuing and new 
reports of violations are being aggressively pursued.
    4. The expenses incurred by the Federal Government in the 
6-month period from September 15, 2001, through March 14, 2002, 
that are directly attributable to the exercise of powers and 
authorities conferred by the declaration of a national 
emergency with respect to Iran are estimated to be 
approximately $1,450,000, most of which represent wage and 
salary costs for Federal personnel. Personnel costs were 
largely centered in the Department of the Treasury 
(particularly in the Office of Foreign Assets Control, the U.S. 
Customs Service, the Office of the Under Secretary for 
Enforcement, and the Office of the General Counsel), the 
Department of State, and the Department of Commerce.
    5. The situation in Iran continues to present an 
extraordinary and unusual threat to the national security, 
foreign policy, and economy of the United States. The 
declaration of the national emergency with respect to Iran 
contained in Executive Order 12957 and the comprehensive 
economic sanctions imposed by Executive Order 12959 underscore 
the United States Government's opposition to the actions and 
policies of the Government of Iran, particularly its support of 
international terrorism and its efforts to acquire weapons of 
mass destruction and the means to deliver them. The 
prohibitions contained in Executive Orders 12957, 12959, and 
13059 advance important objectives in furthering the 
nonproliferation and anti-terrorism policies of the United 
States.

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