By Maureen Lorenzetti
OGJ Online
WASHINGTON, DC, May 9 -- US lawmakers may seek to renew a controversial law that seeks to punish foreign countries or companies that invest in Iran or Libya, the chairman of the House Subcommittee on Middle East and South Asia said Wednesday.
"If as President [George W.] Bush certified in March, Iran continues to threaten the vital interests of the national security, foreign policy, and economy of the US," then we must continue to do everything to contain that threat. And today that means we must renew the Iran-Libya Sanctions Act," said Rep. Benjamin Gilman (R-NY), a sponsor of the 1996 legislation.
ILSA will expire this August unless Congress reauthorizes it. The law allows the president to impose economic sanctions if a company invests $20 million or more in either Iran or Libya.
Congressional review of the law comes at a critical juncture for the White House, which is considering how economic sanctions should or should not be used in the context of a national energy policy.
For example, Sec. of State Colin Powell has signaled he may be willing to change Iraqi sanctions under the "oil-for-food" United Nations program in favor of a "smart" sanctions regime that emphasizes inspections over economic barriers. The conventional thinking had been that the Bush administration would be open to lifting sanctions against Iran as well. Key Republican senators, including Energy and Natural Resources Committee chairman Frank Murkowski (R-Alas.) and Majority Leader Trent Lott (R-Miss.), had said last year that sanction reforms were needed.
But Iran has been not as accommodating as White House officials had hoped in the last few months despite earlier promises of reform from Iran's elected officials. And some House Republican and Democratic leaders say the law needs to be renewed in some form.
"The seeds of hope planted by the US last year may wither and die unless the leadership in Iran takes steps to rejoin the family of peace-loving, law-abiding nations, respectful of human rights and international norms of justice," said Tom Lantos (D-Calif.), ranking Democrat on the Committee on International Relations. "Until it does, the administration has no choice but to hold firm to our principles and policies."
Industry groups urged lawmakers to let the law expire, arguing ILSA is a "blunt" instrument that hinders the real work of US diplomacy.
National Foreign Trade Council Pres. Bill Reinsch said the law also is ineffective.
"Despite ILSA's extraterritorial sanctions, both Iran and Libya receive significant capital investment in their oil and gas sectors," he testified. "Last March, the Congressional Research Service reported that $10.5 billion of foreign investment has taken place in Iran's oil and gas sector since 1997. Iran expects $1.5 billion to be invested in the petrochemical sector this year. These investors include France, Canada, Italy, Japan, the UK, among others -- companies from our closest allies and most important trading partners, which have not been deterred by the threat of ILSA."
Former Sen. Alfonse D'Amato (R-NY), the author of ILSA, disagreed. He said the law has had a "devastating impact" on Iran's ability to develop its oil infrastructure.
Contact Maureen Lorenzetti at [email protected]
