H.Doc.108-78 TERMINATION OF EMERGENCIES WITH RESPECT TO YUGOSLAVIA AND MODIFICATION ...

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108th Congress, 1st Session - - - - - - - - - - - - - House Document 108-77


 
 SIX MONTH PERIODIC REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO 
             YUGOSLAVIA (SERBIA AND MONTENEGRO) AND KOSOVO

                               __________

                             COMMUNICATION

                                  from

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

   A COMBINED SIX MONTH PERIODIC REPORT ON THE NATIONAL EMERGENCIES 
DECLARED WITH RESPECT TO THE FEDERAL REPUBLIC OF YUGOSLAVIA (SERBIA AND 
   MONTENEGRO) DECLARED IN EXECUTIVE ORDER 12808 ON MAY 30, 1992 AND 
KOSOVO IN EXECUTIVE ORDER 13088 ON JUNE 9, 1998, PURSUANT TO 50 U.S.C. 
                     1641(c) AND 50 U.S.C. 1703(c)

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June 3, 2003.--Referred to the Committee on International Relations and 
                         ordered to be printed
                                           The White House,
                                          Washington, May 27, 2003.
Hon. J. Dennis Hastert,
Speaker of the House of Representatives,
Washington, DC.
    Dear Mr. Speaker: 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 am providing a combined 6-month report prepared by 
my Administration on the national emergencies declared with 
respect to the Federal Republic of Yugoslavia (Serbia and 
Montenegro) in Executive Order 12808 on May 30, 1992, and 
Kosovo in Executive Order 13088 on June 9, 1998.
            Sincerely,
                                                    George W. Bush.
Periodic Report on the National Emergencies With Respect to the Federal 
             Republic of Yugoslavia (Serbia and Montenegro)

    This report to the Congress addresses developments over the 
course of the past 6 months concerning the national emergency 
with respect to the Federal Republic of Yugoslavia (now 
officially Serbia and Montenegro from February 4, 2003) (the 
``FRY (SaM)'') that was declared in Executive Order 12808 on 
May 30, 1992, and was expanded in Executive Order 12934, issued 
on October 25, 1994, with respect to the Bosnian Serbs. This 
report also covers developments over the course of the past 6 
months concerning the national emergency with respect to the 
FRY (SaM) and Kosovo that was declared in Executive Order 13088 
on June 9, 1998, as supplemented by Executive Order 13121, 
issued on April 30, 1999, and as amended in Executive Order 
13192 of January 17, 2001. This report is submitted pursuant to 
section 204(c) of the International Emergency Economic Powers 
Act, 50 U.S.C. 1703(c) (IEEPA), and section 401(c) of the 
National Emergencies Act, 50 U.S.C. 1641(c).
    The Department of the Treasury effected a partial 
unblocking of assets on February 25, 2002. This unblocking was 
pursuant to the new general licenses issued by the Department 
of the Treasury's Office of Foreign Assets Control (``OFAC'') 
in the ``Federal Republic of Yugoslavia (Serbia and Montenegro) 
and Bosnian Serb-controlled Areas of the Republic of Bosnia and 
Herzegovina Sanctions Regulations,'' 31 CFR Part 585 (the 
``Bosnia and Herzegovina Regulations'') and the ``Federal 
Republic of Yugoslavia (Serbia and Montenegro) Kosovo Sanctions 
Regulations,'' 31 CFR Part 586 (the ``Kosovo Regulations'') on 
December 27, 2002, (67 Fed. Reg. 78973). The general licenses 
unblocked all remaining property and interests in property 
blocked under the Bosnia and Herzegovina Regulations and the 
Kosovo Regulations 60 days from December 27, 2002, with certain 
exceptions. Those exceptions kept blocked any property or 
interests in property of (1) diplomatic and/or consular 
missions of the former Socialist Federal Republic of 
Yugoslavia, (2) those persons who are presently subject to 
sanctions under the ``Federal Republic of Yugoslavia (Serbia 
and Montenegro) Milosevic Regulations,'' 31 CFR Part 587 (the 
``Milosevic Regulations'') or the ``Western Balkans 
Stabilization Regulations,'' 31 CFR Part 588, or (3) the 
central bank of the former Socialist Federal Republic of 
Yugoslavia (the National Bank of Yugoslavia). A copy of these 
regulatory amendments is attached.
    There were no amendments to the Milosevic Regulations 
during this reporting period.
    During this reporting period, OFAC issued no specific 
licenses under the Kosovo Regulations or the Milosevic 
Regulations. Letters were issued notifying applicants for 
specific licenses that property blocked under both the Bosnia 
and Herzegovina Regulations and the Kosovo Regulations would be 
unblocked, subject to certain exceptions, under the general 
licenses described in Paragraph 1, without further action on 
their part.
    In April 2003, the United States Government took steps, 
through a series of directive licenses, to transfer the assets 
of the National Bank of Yugoslavia that were blocked pursuant 
to the 1992 national emergency to the successor states of the 
former Socialist Federal Republic of Yugoslavia. In any cases 
where such assets have yet to be transferred, the assets remain 
blocked.
    Since my last report, OFAC has collected four civil 
monetary penalties totaling more than $43,000 for violations of 
the sanctions by two U.S. financial institutions and two U.S. 
companies. These violations involved payments either to the 
Government of the FRY (SaM), persons in the FRY (SaM), or to 
blocked entities owned or controlled by the Government of the 
FRY (SaM), or the importation of goods from the territory of 
the FRY during the effective period of the trade sanctions. An 
additional case is undergoing penalty action for violation of 
the Bosnia and Herzegovina Regulations and an additional 104 
cases are undergoing penalty action for violation of the Kosovo 
Regulations.
    The expenses incurred by the Federal Government in the 6-
month period from December 1, 2002, through May 29, 2003, that 
are directly attributable to the declaration of the national 
emergencies made in 1992 and 1998 are estimated at 
approximately $235,000, most of which represents wage and 
salary costs for Federal personnel. Personnel costs were 
largely centered in the Department of the Treasury 
(particularly in OFAC, the Chief Counsel's Office, and the U.S. 
Customs Service), the Departments of State and Commerce, and 
the National Security Council.
    It is in the United States' foreign policy interest to 
support Serbia and Montenegro's freely elected government as it 
works toward building a stable, democratic, and economically 
vibrant society. Following Secretary of State Powell's May 2002 
meeting with FRY Foreign Minister Svilanovic and then Serbian 
Prime Minister Djindjic, Secretary Powell formally certified to 
the Congress that the FRY was cooperating with the 
International Criminal Tribunal for the former Yugoslavia 
(``ICTY''). Subsequently, Secretary Powell requested that the 
Department of the Treasury take steps to begin the process of 
unblocking all previously frozen assets--except those linked to 
Slobodan Milosevic, his close associates and supporters and 
persons under indictment for war crimes by the ICTY.
    The Departments of State and Treasury worked closely on a 
plan to unblock certain assets and to transfer others. Certain 
steps remain with respect to a small category of property that 
continues to be blocked. The funds transferred took on added 
importance for Serbia and Montenegro as it began to deal with 
the financial repercussions relating to the tragic 
assassination of Serbian Prime Minister Djindjic. The plan to 
unblock certain assets and transfer others also underscores the 
United States' continuing commitment to fully normalizing 
economic relations with Serbia and Montenegro.
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