House Republican leader seeks to tighten Iran-Libya sanctions

Nov. 3, 2003
A House Republican leader Oct. 21 introduced a bill that would limit exemptions and waivers to a US law designed to punish foreign oil companies that invest in either Libya or Iran's petroleum sector.

A House Republican leader Oct. 21 introduced a bill that would limit exemptions and waivers to a US law designed to punish foreign oil companies that invest in either Libya or Iran's petroleum sector.

US Rep. Ileana Ros-Lehtinen, (R-Fla.), chairwoman of the Subcommittee on the Middle East and Central Asia of the House Committee on International Relations, introduced the Iran-Libya Sanctions Act Enhancement and Compliance Act (ILSA-ECA) "to address the concerns, loopholes, and changes in the world since the original bill's passage in 1996," according to a statement.

"Neither Iran or Libya have shown signs of relenting in their support for international terrorism. Those companies who continue to pursue investment in the oil sectors of these rogue nations, thus enabling this aggression, must realize that they are bankrolling terrorism," said Ros-Lehtinen. "ILSA must be amended to address this continued financing of terror."

Current act

The current law was first passed in 1996 and extended with minor revisions in 2001. In theory, investments of $20 million or more by a company can trigger an imposition of a number of sanctions options, but the White House has broad authority to waive or exempt a foreign country or company. Actual sanctions have never been imposed, although some policy analysts maintain just the threat of sanctions has dampened investment.

Ros-Lehtinen's push to strengthen the law comes as the Department of State readies a report due before Congress next February detailing how effective ILSA sanctions have been since lawmakers updated the legislation in 2001. And in the Senate, some lawmakers are moving in the opposite direction: Foreign Relations Committee Chairman Richard Lugar (R-Ind.) is expected to reintroduce legislation seeking a more deliberative, business-friendly approach to US sanctions policy (OGJ, Aug. 18, 2003, p. 35).

New act

ILSA-ECA includes provisions that strengthen US sanctions against Libya and Iran by narrowing the conditions under which the White House can waive the law. It extends the classification of parties subject to sanctions to include public and private financiers and lenders and makes the removal of sanctions contingent upon a presidential certification that Iran and Libya no longer pose a "threat to the national security of the United States, its interests, or allies." It establishes an Office of Global Security Risk within the Securities and Exchange Commission to assess the risk to US investors of companies that invest in countries thought to be sponsoring or supporting terrorism.

Hearings have not been scheduled yet. The White House as yet has no formal position on the bill, although industry lobbyists are hoping a recent decision by Iran to back away from aggressively pursing a nuclear program may encourage US policymakers to relax, rather than tighten, existing sanctions against the oil-rich country, which continues to see internal struggles between reformers and conservatives.