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FACT SHEET:U.S.SANCTIONS LAWS RELAT
- Subject: FACT SHEET:U.S.SANCTIONS LAWS RELAT
- From: moe@xxxxxxxxxxxxx
- Date: Wed, 17 Sep 1997 21:36:00
TITLE:17-09-97 FACT SHEET: U.S. SANCTIONS LAWS RELATED TO FOREIGN POLICY
(Number increased sharply in 1990s) (3680)
Washington -- Following is a list of some of the laws in effect today
that were passed by Congress authorizing U.S. economic sanctions for
foreign policy reasons.
They are presented in reverse chronological order; the number in
parentheses is the date on which the law went into effect. The list
excludes laws authorizing sanctions for retaliating against unfair
trade barriers and for punishing violations of conservation measures.
(This article appears also in USIA's September 17 electronic journal
Economic Perspectives. The complete journal can be found on the USIA
web site at http://www.usia.gov/journals/journals.htm):
FOREIGN OPERATIONS, EXPORT FINANCING AND RELATED PROGRAMS
APPROPRIATIONS ACT, FISCAL YEAR 1997 (September 30, 1996)
Section 570 of this act prohibits new investment in Burma, pending
progress on human rights, and requires U.S. representatives to
international financial institutions to vote against spending for
Section 533 prohibits U.S. foreign aid to any country not complying
with UN sanctions against Iraq and Serbia-Montenegro. It also
authorizes the president to ban U.S. imports of goods from countries
that have not enacted trade restrictions against Iraq and
Section 553 puts conditions on release of foreign aid to the Palestine
Section 507 prohibits direct foreign aid to the seven countries on the
State Department's list of countries that support terrorism: Cuba,
Iran, Iraq, Libya, North Korea, Sudan, and Syria.
Section 523 prohibits, with specific exceptions, indirect foreign aid
to Cuba, Iran, Iraq, Libya, North Korea, Syria, and China.
Section 567 restricts, with specific exceptions, military aid to
Section 569 restricts, with specific exceptions, foreign aid to Haiti.
Section 579 requires U.S. representatives to international financial
institutions to oppose spending for any country where the people
practice female genital mutilation and where the government has made
no effort to educate the people against performing this practice.
IRAN AND LIBYA SANCTIONS ACT OF 1996 (August 5, 1996)
This law requires the president to impose sanctions against foreign
companies that invest $40 million in any one-year period for
development of Iran or Libya's petroleum resources (in August 1997,
the threshold dropped to $20 million for Iran). Sanctions are mandated
also for any foreign company exporting to Libya goods such as aircraft
and oil-refining equipment that are prohibited by UN resolutions. The
sanctions include denial of Export-Import Bank credits, denial of
licenses for controlled U.S. exports, prohibition of loans from U.S.
financial institutions, and prohibition on bids for U.S. government
Senator Alfonse D'Amato, sponsor of the law, and other members of
Congress criticized a Clinton administration decision in August not to
oppose construction of a gas pipeline across Iran linking supplies in
Turkmenistan with market demands in Turkey.
Also in August, the Canadian company Bow Valley Energy Limited signed
a deal to develop Iran's Balal oil field. D'Amato urged the State
Department to impose sanctions against Bow Valley and its partners.
The State Department has issued no statement yet.
ANTITERRORISM AND EFFECTIVE DEATH PENALTY ACT OF 1996 (April 24, 1996)
This law prohibits U.S. nationals from supporting terrorist
organizations and from engaging in financial transactions with
governments named on the State Department's terrorism list: Cuba,
Iran, Iraq, Libya, North Korea, Sudan, and Syria.
As five of those countries were already subject to comprehensive U.S.
embargoes, the 1996 law has affected only Syria and Sudan, and only
Syria has had significant trade with the United States. The Treasury
Department's August 1996 regulations implementing the law prohibit
only those financial transactions with Syria and Sudan that would
promote terrorist activities in the United States. Viewing the Clinton
administration's actions as too limited and contrary to the 1996 law's
congressional intent, members of the House of Representatives passed a
bill in July 1997 by 377-33 that would essentially eliminate the
administration's discretion in prohibiting transactions with the two
countries. A provision in a Senate-passed foreign affairs spending
bill would allow the president to waive sanctions under the law for
national security reasons. Resolution of the different approaches
could emerge from a House-Senate conference on the spending bill.
The law also prohibits certain U.S. foreign aid to any country that
provides assistance or lethal military equipment to a terrorism-list
country, requires U.S. representatives to international financial
institutions to oppose spending for those countries, and prohibits
exports of munitions to any country certified by the president as not
cooperating on fighting terrorism.
CUBAN LIBERTY AND DEMOCRATIC SOLIDARITY ACT OF 1996 (HELMS-BURTON ACT)
(March 12, 1996)
Title I codifies the comprehensive U.S. trade embargo against Cuba
maintained since 1960 through regulations under the Foreign Assistance
Act, the Trading With the Enemy Act, and other laws. It also requires
U.S. representatives to international financial institutions to oppose
Cuban membership in those institutions, and restricts U.S. payments to
any such institution that approves assistance to Cuba over U.S.
objections. It denies assistance to any former Soviet republic that
assists or engages in non-market-based trade with the Cuban
government. It subtracts from U.S. aid to Russia an amount of money
equal to Russia's support for its intelligence facility at Lourdes,
Cuba; it subtracts foreign aid to any country by the amount the
country provides for Cuba's Juragua nuclear facility.
Title III gives U.S. nationals the right to bring suit in U.S. federal
courts against foreign companies investing in or profiting from
property confiscated from them by the Cuban government; it allows
award of damages up to three times the value of the confiscated
property. President Clinton has waived this provision for six-month
periods three times: in July 1996, January 1997, and July 1997. Newly
introduced legislation repealing the president's waiver authority is
expected to draw wide support in the House of Representatives.
The European Union (EU) has challenged Title III in the World Trade
Organization. In April the EU suspended its challenge as it attempts
to negotiate with the United States by October 15 a binding
international agreement on disciplines for expropriation of property.
The Clinton administration pledged to seek from Congress changes in
the law sought by the EU if the expropriation agreement is reached.
Those negotiations continue.
Title IV requires the State Department to deny visas to any foreigner,
as well as his or her spouse and children, who traffics in confiscated
property in Cuba subject to a claim by a U.S. national. The department
has so far barred from the United States executives of the Canadian
mining company Sherritt International and of the Mexican
telecommunications company Grupos Domos.
In July, the Italian telecommunications group Stet reached a
settlement with the State Department for compensating the U.S.
conglomerate ITT for work on Cuba's telephone system, which ITT
controlled before Castro's expropriation. Stet thus achieved effective
immunity from Title III and Title IV.
NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1996 (February 10,
This law prohibits the Defense Department from giving aid to countries
on the State Department's terrorism list.
FOREIGN RELATIONS AUTHORIZATION ACT FOR 1994 AND 1995, AS AMENDED
(April 30, 1994)
This law prohibits the federal government from selling defense goods
or services to any country that is "known" to request compliance with
the Arab League secondary boycott of Israel. The president has applied
this sanction to Iran, Iraq, Libya, Sudan, Syria, and Yemen. He has
waived application of it to Algeria, Bahrain, Bangladesh, Kuwait,
Lebanon, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.
HICKENLOOPER AMENDMENT EXPANSION (April 30, 1994)
This provision prohibits U.S. foreign aid to countries that have
expropriated property of a U.S. citizen without compensation, and
requires U.S. representatives to international financial institutions
to oppose spending for those countries.
NUCLEAR PROLIFERATION PREVENTION ACT OF 1994 (April 30, 1994)
Sections 821 and 824 mandate sanctions against any person determined
to have helped a non-nuclear-weapon state acquire nuclear material or
devices. The sanctions prohibit any such person from bidding on U.S.
federal government procurement or from dealing in federal bonds.
Section 825 prohibits the Export-Import Bank of the United States
(Ex-Im Bank) from providing credits to any country that helps a
non-nuclear-weapon state acquire nuclear devices or materials.
Section 530 prohibits U.S. foreign aid to non-nuclear-weapon states
that violate International Atomic Energy Agency agreements or
bilateral nuclear cooperation agreements.
The law also amends the Arms Export Control Act in a number of ways.
It prohibits U.S. government sales of munitions and defense services
to countries violating nuclear non-proliferation agreements. It
prohibits foreign aid to any country that receives or delivers to
another country nuclear enrichment materials or technology without
proper safeguards or that attempts to export illegally from the United
States anything used to make nuclear weapons. It also requires a
number of sanctions against both sides in a transfer of nuclear
devices, components, or designs from any country to a
IRAN-IRAQ ARMS NON-PROLIFERATION ACT OF 1992, AS AMENDED (October 23,
This law applies to Iran the same export license prohibitions applied
to Iraq in the Iraq Sanctions Act of 1990. It also mandates sanctions
against any foreign government that transfers technology or goods that
help Iran or Iraq acquire advanced conventional weapons, or chemical,
biological, or nuclear weapons. Those sanctions include suspension of
foreign aid, ban on access to U.S. government procurement contracts,
denial of export licenses, opposition to spending by international
financial institutions, and suspension of military transfers and
CUBAN DEMOCRACY ACT OF 1992 (October 23, 1992)
This law restates or modifies earlier legislation used in imposing a
total trade embargo on Cuba, including the Foreign Assistance Act of
1961, the Trading With the Enemy Act, the International Emergency
Economic Powers Act, and the Export Administration Act of 1979.
Section 1704(b) authorizes the president to apply sanctions against
foreign countries providing Cuba grants or concessional sales,
subsidizing exports to Cuba, or giving preferential treatment to
imports from Cuba. The sanctions include ineligibility for foreign
aid, for U.S. government sales of controlled munitions, and for debt
reduction from the U.S. government.
Section 1706 extends the U.S. embargo against trade with Cuba to
foreign subsidiaries of U.S. companies. It also restricts U.S. port
privileges for ships that carry Cuban goods or engage in trade at
Section 1705 allows, with some exceptions, donations of food to Cuban
non-government organizations; exports of medicines and medical
supplies and equipment; provision of telecommunications services and
appropriate facilities; direct mail service between the United States
and Cuba, and assistance for promoting non-violent democratic change
CHEMICAL AND BIOLOGICAL WEAPONS CONTROL AND WARFARE ELIMINATION ACT OF
1991 (December 4, 1991)
Sections 306 and 307 mandate sanctions against a country determined to
have used chemical or biological weapons in violation of international
law or against its own nationals. The sanctions, which may be waived
by the president, are termination of foreign aid and foreign military
financing, prohibition of certain U.S. controlled exports, and denial
of Ex-Im Bank credit.
This law also amends the Arms Export Control Act and the Export
Administration Act. Those sections mandate sanctions against
foreigners who export technology or goods that help a terrorist
country acquire chemical or biological weapons. The sanctions prohibit
the foreigner from bidding on a U.S. government procurement contract
and from exporting goods to the United States.
IRAQ SANCTIONS ACT OF 1990 (November 5, 1990)
On top of the comprehensive U.S. trade embargo imposed on Iraq in
August 1990 after it invaded Kuwait, Congress passed this law denying
to Iraq U.S. foreign aid and Ex-Im Bank credit and requiring U.S.
opposition to spending for Iraq by international financial
The law also restricts U.S. exports of supercomputers to countries
assisting Iraq's weapons capabilities.
The sanctions may be waived by the president if there is a change of
leadership in Iraq.
NATIONAL DEFENSE AUTHORIZATION ACT FOR 1990-1991, AS AMENDED (November
This law mandates sanctions against foreigners who export goods or
technology controlled under the multilateral Missile Technology
Control Regime (MTCR) to a non-MTCR country if that sale helps the
country produce missiles. The sanction applies even if the export was
not of U.S. origin or made from U.S.-origin technology.
Under a provision called the Helms amendment aimed at China, any
sanction imposed on a foreigner in a non-market economy must also be
applied to the government there. The sanctions deny U.S. exports of
munitions and prohibit participation in U.S. government procurement
contracts. President Clinton imposed such sanctions against China and
Pakistan in August 1993; he waived the sanctions against China in
November 1994; the Pakistan sanctions expired after two years.
FOREIGN RELATIONS AUTHORIZATION ACT FOR 1990-91, AS AMENDED (February
This law prohibits a number of U.S. benefits to China, including
credit from the Overseas Private Investment Corporation (OPIC);
foreign aid; exports of certain satellites; and licenses for export of
certain munitions, crime control equipment, and nuclear material,
technology, and equipment.
NARCOTICS CONTROL TRADE ACT (October 27, 1986) AND FOREIGN ASSISTANCE
ACT, AS AMENDED (September 4, 1961)
Under Sections 481 and 490 of the amended Foreign Assistance Act, no
foreign aid or credit from Ex-Im Bank or OPIC can go to any
drug-producing or drug transit country not certified by the president
as cooperating with U.S. counter-narcotics efforts.
Section 802 of the Narcotics Control Trade Act requires the president
to apply other sanctions to those uncertified countries, including
denial of preferential tariffs under the Generalized System of
Preferences (GSP), and to restrict air transportation between the
United States and those countries.
Section 803 of the law prohibits the president from allocating any
U.S. sugar import quota to any country where the government engages in
illegal drug trade or fails to cooperate with U.S. counter-narcotics
DEPARTMENT OF DEFENSE APPROPRIATIONS ACT OF 1987 (October 18, 1986)
This law prohibits the U.S. Department of Defense from entering into
contracts of $100,000 or more with companies owned or controlled by
the government of a State Department terrorism-list country.
INTERNATIONAL SECURITY AND DEVELOPMENT COOPERATION ACT OF 1985 (August
Section 505 authorizes the president to restrict or ban imports of
goods and services from countries on the State Department terrorism
list, and to prohibit exports of goods and technology to Libya.
EXPORT ADMINISTRATION ACT (EAA) OF 1979, AS AMENDED (September 29,
Section 11A mandates sanctions against foreigners who violate certain
multilateral export controls. The sanctions ban imports and bids for
U.S. government procurement contracts. Such sanctions were applied in
1988 to Toshiba Machine Company of Japan and Kongsberg Trading Company
INTERNATIONAL EMERGENCY ECONOMIC POWERS ACT (IEEPA) (October 28, 1977)
Under this law, the president has broad authority "to deal with an
unusual and extraordinary threat, which has its source in whole or in
part outside the United States, to the national security, foreign
policy, or economy of the United States."
After the president declares a national emergency, he can restrict or
prohibit virtually any foreign economic transaction: imports, exports,
and transfers of money or credit.
Under IEEPA, the Treasury Department's Office of Foreign Assets
Control (OFAC) administers sanctions against Iran, Libya, Iraq,
Serbia-Montenegro, and Angola.
Sanctions from 1979 and 1995 prohibit most U.S. transactions with
Iran, including any brokering and financing related to trade in
Iranian goods and services. They prohibit U.S. exports to Iran as well
as re-exports to Iran from other countries of certain U.S.-origin
goods and technology. They prohibit investments by U.S. persons in
Iran as well as those by a foreign subsidiary of a U.S. company.
Sanctions also block transactions of certain assets of the Iranian
government and central bank within U.S. jurisdiction.
For Libya, 1986 sanctions block the assets in the United States of the
Libyan government and of persons acting on its behalf. They prohibit
essentially all U.S. exports to Libya and U.S. imports from Libya;
they allow re-exports to Libya of U.S.-origin goods that are
substantially transformed in a third country, except those used in
Libya's petroleum sector.
For Iraq, the 1990 sanctions implementing a United Nations resolution
block financial assets in the United States of the Iraqi government.
They prohibit most U.S. exports and re-exports of U.S. goods and
technology to Iraq, U.S. imports of goods from Iraq, and financial
transactions with the Iraqi government. Unilateral U.S. sanctions also
prohibit exports of U.S. services to Iraq and block all property
assets in the United States of the Iraqi government.
OFAC regulations of December 1996, implementing a later UN resolution,
authorize U.S. companies to seek licenses to buy oil from Iraq; the
revenue is intended for the purchase of humanitarian supplies for
Regulations of 1992 and 1994 block the assets of the governments of
Serbia-Montenegro in the United States, as well as those of the
Bosnian Serb-controlled areas of Bosnia and Herzegovina.
Regulations of September 1993 prohibit the sale or supply of arms and
related material or petroleum and petroleum products to Angola, except
through a few designated points of entry, and prohibit such sales to
the National Union for the Total Independence of Angola (UNITA).
Also under IEEPA, regulations of January 1995 prohibit all
transactions with persons listed by the State Department as having
committed or posing a significant risk of committing acts of violence
to disrupt the Middle East peace process.
ARMS EXPORT CONTROL ACT, AS AMENDED (October 22, 1968)
Section 40 prohibits exports of munitions to countries on the State
Department terrorism list.
Section 38 restricts munitions exports under certain foreign policy
objectives, including the possibility of escalating conflict and human
rights violations. At present the State Department denies licenses for
munitions exports to Afghanistan, Angola, Armenia, Azerbaijan,
Belarus, Burma, China, the Democratic Republic of Congo, Haiti,
Liberia, Rwanda, Serbia-Montenegro, Somalia, Tajikistan, and Vietnam.
UNITED NATIONS PARTICIPATION ACT OF 1945 (December 20, 1945)
Section 287(c) gives the president broad powers to impose economic
sanctions, but only those mandated by the UN Security Council.
EXPORT-IMPORT BANK ACT, AS AMENDED (July 31, 1945)
This law prohibits Ex-Im Bank credits to "Marxist-Leninist" countries
(China has received a "national interest" waiver from successive
presidents since 1980) and to countries that have violated
International Atomic Energy Agency safeguards or U.S. bilateral
agreements regarding nuclear energy.
SMOOT-HAWLEY TARIFF ACT OF 1930 (June 17, 1930)
This law prohibits U.S. imports of goods mined, produced, or
manufactured by convict labor, forced labor, or indentured labor,
except for goods otherwise unattainable to meet U.S. demand. At
present the Treasury Department applies this law to certain products
from China and Mexico.
TRADING WITH THE ENEMY ACT (TWEA) (October 16, 1917)
Section 5 prohibits trade with any enemy or ally of an enemy during a
war. From 1933 until 1977, the law was expanded to control both
domestic and international financial transactions during peacetime as
well as during war. When Congress passed IEEPA in 1977, it restricted
somewhat the president's authority to control economic transactions
during peacetime emergencies. At the same time, Congress revised the
Trading With the Enemy Act, retaining the president's broader
authority to control foreign transactions and property interests
during war; it also continued trade embargoes and foreign assets
controls then in effect, including one with North Korea.
Although the total embargo on transactions with North Korea from 1950
was modified after an October 1994 U.S.-North Korean agreement to
begin reducing barriers to trade and investment, bilateral trade
remains mostly restricted. Treasury's OFAC generally prohibits U.S.
imports from North Korea, but may issue specific licenses for imports
of North Korean-origin Magnesite or magnesia. Commerce Department
licenses are required for all U.S. exports to North Korea except for
items like books, magazines, films and compact disks. The regulations
prohibit buying and selling to North Korean nationals doing business
anywhere in the world.
Religious Persecution: A bill has been introduced in Congress that
would impose unilateral U.S. economic sanctions against governments
determined to be engaged in religious persecution involving
imprisonment, forced resettlement and other forms of brutality.
Neither the House nor Senate has yet to act on the bill. Consideration
by the House International Relations Committee was scheduled September
11 but postponed with no new date scheduled.
State and Local Sanctions: In July the EU challenged in the WTO a
Massachusetts state law imposing sanctions against foreign companies
doing business with Burma. According to the EU, the law violates WTO
procurement rules. The Clinton administration is defending
Massachusetts during a 60-day consultation period. If still
dissatisfied after consultations, the EU can request a WTO panel to
settle the dispute, which could ultimately lead to retaliatory EU
trade sanctions. Such a case could set a precedent for handling of
state or provincial rights and sovereignty under multilateral trade
Meanwhile, a Journal of Commerce report says the USA Engage coalition
of more than 600 U.S. big businesses is planning to challenge
sanctions imposed by state and municipal governments in federal court,
arguing that they infringe on the federal government's constitutional
powers for conducting foreign policy.
Sanctions Reform: Published reports say that Senator Richard Lugar and
Representative Lee Hamilton are circulating a legislative proposal
that would set conditions on Congress for passing additional
unilateral sanctions laws. They have made no official comment yet.
Hamilton has said publicly that sanctions should be subject to
cost-benefit analysis concerning the likelihood they will achieve
their objective and the costs they will impose on U.S. business and
SOURCES: President's Export Council; U.S. Treasury Department; U.S.
House of Representatives Ways and Means Committee; National
Association of Manufacturers