Senate Foreign Relations Hears Testimony on Pending Iran Sanctions Conference Bill

(Both the House and Senate have passed their own versions of legislation to amend the existing sanctions imposed against Iran¹. The two bills, H.R. 2194 and S. 2799, are now in conference committee. The hearing was held to elicit additional information as the conference committee works to resolve differences between the two versions.)

All Say Existing Iran Sanctions Law Needs to be Enforced

Witnesses at the hearing uniformly stated that there is a need for existing Iran sanctions to be enforced. The current Administration and previous Administrations have not been consistent in their enforcement efforts, witnesses stated. Without consistent enforcement, any new legislation will also be ineffective, despite containing more stringent sanctions requirements.

List of companies investing in Iran sought. Senators Lieberman and Collins stated that as follow up to the hearing they will send a letter to the Department of State requesting information on who is responsible for compiling information on companies that invest in Iran and providing that information to Congress. Current law requires State to submit a report containing that information to Congress every six months. (The last report was submitted in 2008, according to witnesses.)

State Dept Wants Cooperating Countries Exempted from Conference Bill

Senator Ensign stated that there has been an effort by the Department of State during conference committee negotiations to include a provision that would allow the President to exempt cooperating countries from the sanction legislation’s requirements (for example, to allow government contracts with companies based in cooperating countries despite their investments in Iran). Witnesses noted that the legislation already provides the President with the authority to make exceptions on the basis of national security (such as needing to purchase fuel from a violating country to supply U.S. efforts in Afghanistan).

Senator Wants LNG Included in Conference Bill

Senator Gillibrand inquired whether it would be more effective if the Iran sanctions legislation under consideration by the conference committee were expanded to include liquefied natural gas in addition to refined petroleum products in the list of prohibited products supplied to Iran. Witnesses responded that the focus of the legislation should remain on preventing Iran from expanding its nuclear program (through funding gained from an expansion of its petroleum industry) and that any changes to the legislation to include the entire supply chain should be focused and targeted.

Two Senators Discuss Dual Use Items for Iran, Visa Denial for CEOs

Senator Gillibrand inquired whether Congress should either transfer authority for Iran sanctions enforcement from the Treasury Department to the Department of Commerce or give additional authority to Treasury to impose export controls on U.S. goods to prevent the exportation of dual use items to Iran. Senator Brown also asked whether denying U.S. visas to corporate executives of foreign companies that invest in Iran would be a useful tool in preventing Iran from increasing its nuclear weapons arsenal.

Senator Considers New Bill to Trigger SEC Disclosure if Doing Business with Iran

Senator Brown stated that he is considering introducing legislation that would make doing business with Iran a material event that would trigger mandatory disclosure on Securities and Exchange Commission filings. This change would make information regarding Iranian investments public and would effectively force companies to self-disclose whether they are in violation of federal and state sanctions laws, he said.

¹The House and Senate bills would direct the President to impose sanctions against companies that supply petroleum products or means of transporting petroleum products to Iran; provide shipping or insurance services; or finance or broker shipping or transportation activities. The bills also would prohibit the awarding of federal contracts to firms that provide assistance to Iran and would lower the existing investment threshold for the imposition of sanctions. In addition, the Senate bill contains more stringent provisions that would prohibit imports of Iranian goods and exports to Iran (with certain exceptions); freeze assets of Iranian officials and associates that support terrorism and proliferation activities; and impose sanctions on U.S. subsidiaries of companies that invest in Iran.

(See ITT Online Archives or 12/17/09 daily news, 09121725, for BP summary of House passed Iran sanctions bill.

See ITT Online Archives or 02/02/10 daily news, 10020215, for BP summary of Senate passed Iran sanctions bill.)

Testimony from the hearing (dated 05/12/10) available at http://hsgac.senate.gov/public/index.cfm?FuseAction=Hearings.Hearing&Hearing_ID=4a74d2fc-da9a-43b7-8bdc-a5bcd9e6f6bf