H.Doc.107-237 INTENTION TO REALLOCATE FUNDS PREVIOUSLY TRANSFERRED FROM THE ...

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107th Congress, 2d Session - - - - - - - - - - - House Document 107-236 


 
         A REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO IRAN

                               __________

                                MESSAGE

                                  from

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

A SIX MONTH PERIODIC REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO 
  IRAN THAT WAS DECLARED IN EXECUTIVE ORDER 12170 OF NOVEMBER 14, 1979, 
  PURSUANT TO 50 U.S.C. 1641(c) AND 50 U.S.C. 1703(c)

<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>


    June 26, 2002.--Message and accompanying papers referred to the 
     Committee on International Relations and ordered to be printed
                               __________

                    U.S. GOVERNMENT PRINTING OFFICE
99-011                    WASHINGTON : 2002

To the Congress of the United States:
    As required by section 401(c) of the National Emergencies 
Act, 50 U.S.C. 1641(c), and section 204(c) of the International 
Emergency Economic Powers Act, 50 U.S.C. 1703(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 12170 of November 14, 
1979.

                                                    George W. Bush.
    The White House, June 25, 2002.
  Periodic Report on the National Emergency With Respect to the 1979 
                 Iranian Emergency and Assets Blocking

    This is a report to the Congress on developments over the 
past 6 months concerning the national emergency with respect to 
Iran that was declared in Executive Order 12170 of November 14, 
1979. This report is submitted pursuant to section 204(c) of 
the International Emergency Economic Powers Act, 50 U.S.C. 
1703(c). This report covers events through March 31, 2002.
    1. There have been no amendments to the Iranian Assets 
Control Regulations, 31 CFR Part 535 (``the Regulations''), 
since the last report.
    2. The Tribunal, established at The Hague pursuant to the 
Algiers Accords, has nearly completed resolution of all of the 
private claims of U.S. nationals against Iran. Its primary 
focus is now the arbitration of claims between the two 
governments. Since the period covered in the last report, the 
Tribunal has not rendered any new awards. Thus, the total 
number of awards rendered by the Tribunal remains 599, the 
majority of which have been in favor of U.S. claimants. As of 
March 31, 2002, the value of awards to successful U.S. 
claimants paid from the Security Account held by the NV 
Settlement Bank was $2,515,743,535.71.
    Since the last report, Iran continues to fail to replenish 
the Security Account established by the Algiers Accords to 
ensure payment of awards to successful U.S. claimants. Thus, 
since November 5, 1992, the Security Account has continuously 
remained below the $500 million balance required by the Algiers 
Accords. As of March 31, 2002, the total amount in the Security 
Account was $93,246,103.11, and the total amount in the 
Interest Account was $51,211,742.73. Because Iran continues to 
fail to comply, on October 15, 2001, the United States filed a 
new Statement of Claim against Iran, thereby initiating Case 
No. A/33. In this claim, the United States requests that the 
Tribunal issue an award directing Iran to replenish the 
Security Account now and in the future. The United States also 
asks that the Tribunal award the United States damages in 
compensation for the costs incurred by the United States in 
pursuing Case No. A/28, the decision which found Iran to be in 
breach of this obligation but did not expressly direct Iran to 
bring itself into compliance. Iran has yet to file a Statement 
of Defense.
    The United States continues to pursue Case A/29 to require 
Iran to meet its obligation of timely payment of its equal 
share of advances for Tribunal expenses when directed to do so 
by the Tribunal.
    3. The United States also continues to pursue a 
counterclaim against Iran in Case No. B/1, Iran's case against 
the United States arising out of Iran's now defunct Foreign 
Military Sales (FMS) program. The U.S. Counterclaim is based 
upon Iran's breach of its contractual obligations under the FMS 
program to protect the secrecy of sensitive items and 
information. Contrary to the U.S. position that the Tribunal 
ought to hear all issues relating to the Counterclaim together, 
on November 27, 2001, the Tribunal issued an order requesting 
that the parties submit hearing memorials on two 
``preliminary'' questions arising under the Counterclaim. The 
first question is whether the Tribunal has jurisdiction over 
the Counterclaim in Case B/1. The second question is, if the 
Tribunal has jurisdiction over the Counterclaim, whether the 
potential recovery of the United States should be limited to an 
offset of any amount Iran might recover in the underlying B/1 
claims. The Tribunal directed the United States to brief these 
two preliminary issues.
    4. One U.S. national continues to pursue a claim against 
Iran at the Tribunal. The case has been fully briefed and 
heard, and the Tribunal's decision is pending.
    5. The Department of State continues to process payments to 
implement the February 22, 1996, settlement agreement related 
to the Iran Air case before the International Court of Justice 
and Iran's bank-related claims against the United States before 
the Tribunal. The Department has authorized payments to 
surviving family members of 247 Iranian victims of the aerial 
incident, totaling $61,950,000.00. As of March 31, 2002, the 
Department has also authorized payment to U.S. nationals 
totaling $17,721,549.19 for 58 claims against Iranian banks. In 
addition, since November 1998, the Department has authorized 
transfer of $10,156,999.50 to the Tribunal for payment of 
Iran's share of the Tribunal's operating expenses.
    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 and 
extraordinary threat to the national security and foreign 
policy of the United States. The Regulations issued pursuant to 
Executive Order 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. 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.

                                  <all>


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