News

TITLE:21-03-96  IRAN OIL SANCTIONS ACT OF 1996 ADVANCES THROUGH CONGRESS

TEXT:
(Congressmen propose sanctions against Iran, Libya) (710)
By Joanne L. Nix
USIA Staff Writer

Washington -- A bill imposing sanctions on nations that invest in Iran
and Libya or export certain goods or technology to those countries was
approved March 21 by the House International Relations Committee.

Despite protests from some committee members and the Clinton
administration, the House International Relations Committee went
further than the Senate did in December 1995, by seeking to punish not
only firms that invest in producing oil and gas in Iran and Libya, but
also targeting exporters of refinery equipment.

Benjamin A. Gilman (Democrat, Florida), Chairman of the Committee and
a co-sponsor of H.R. 3107, the Iran Oil Sanctions Act of 1996, said
the bill "would put our country on the front lines of the battle
(against) terrorism around the world."

"Our legislation offers foreign companies in the oil and gas industry
a simple choice -- they can do business with the United States or with
Iran and Libya -- but not both," Gilman stated. "This measure helps to
deliver an unmistakable message to our European and Asian allies. The
era of dialogue is over; the time for action is now."

H.R. 3107 is more restrictive than a similar measure passed by the
Senate in December. Under H.R. 3107 foreign companies that trade with
or invest in the oil industries of Iran or Libya would be subject to
sanctions. The Senate measure applied only to companies investing in
the two countries.

U.S. companies are barred by executive order from most business
activity in the two countries.

Senator Alfonse D'Amato (Republican, New York), the Senate bill's
chief sponsor, appeared before the House committee and endorsed the
latest proposal for Iran and Libya's economic isolation. "The world
must understand that (Iran and Libya) are the chief sponsors of
international terrorism today," he said. "We must view any business
deal that provides Iran and Libya with the hard currency to develop
their energy sector as a direct threat to U.S. national security."

Although the bill received overwhelming bipartisan support from the
committee, Barbara Larkin, Deputy Assistant Secretary of State for
Legislative Affairs, testified that it might be wiser to use
diplomatic means to convince America's European and Asian allies to
boycott Iran and Libya. She said that the administration supports the
investment sanctions in the Senate version of the bill, but she urged
the committee to carefully examine trade restrictions as an option.
"Trade sanctions would be difficult to monitor ... and very difficult
to enforce," she pointed out.

Asked if the House bill would require the United States to monitor all
of Iran's trade, she replied that it would and that enforcement would
impose "a tremendous administrative burden."

Also, she said, the administration anticipates legal challenges from
governments that interpret the sanctions as violations of trade
agreements between the United States and other countries.

As an example of Larkin's point, Rep. Doug Bereuter
(Republican-Nebraska) read a letter from the European Union expressing
"our strong and unequivocal opposition" to the bill.

Likewise, Congressman Toby Roth (Republican, Wisconsin), urged the
committee not to isolate the United States from its allies. "Effective
action requires a multi-lateral approach, with a common strategy," he
suggested.

Roth pointed out that the Iran/Libya sanctions bill was "totally
unilateral. It threatens the citizens and companies of our closest
allies in Europe and Asia," he warned. "By ourselves, we have little
leverage with Iran and Libya."

H.R. 3107 would require the president to impose various sanctions
against a company that exports certain petroleum-related technology to
Iran or Libya, or that invests $40 million or more in one year in
either nation's oil or gas industry.

The sanctions could include denial of Export-Import Bank assistance
for any exports; denial of licenses for exports of controlled
technology and prohibitions on imports; a ban on sales to the U.S.
government; and prohibitions against being a primary dealer in U.S.
government bonds or as a repository of U.S. funds.

The committee approved the bill by a vote of 32 to 0. Before it can go
to the House floor, it must be approved by three other House
committees that have jurisdiction over some of its provisions.
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