I 

108TH CONGRESS 

1ST SESSION H. R. 3347

To amend the Iran and Libya Sanctions Act of 1996 to prevent the direct 

and indirect financing of the development of weapons of mass destruction 

programs by Iran and Libya, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

OCTOBER 20, 2003

Ms. ROS-LEHTINEN introduced the following bill; which was referred to the 

Committee on International Relations, and in addition to the Committees 

on Financial Services, Ways and Means, and Government Reform, for a 

period to be subsequently determined by the Speaker, in each case for 

consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL

To amend the Iran and Libya Sanctions Act of 1996 to 

prevent the direct and indirect financing of the development of weapons of mass destruction programs by Iran 

and Libya, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘ILSA Enhancement and Compliance Act’’. 
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1 (b) TABLE OF CONTENTS.—The table of contents of 

2 this Act is as follows:

Sec. 1. Short title; table of contents. 

Sec. 2. Findings. 

TITLE I—AMENDMENTS TO THE IRAN AND LIBYA SANCTIONS 

ACT OF 1996

Sec. 101. Multilateral regime. 

Sec. 102. Imposition of sanctions. 

Sec. 103. Description of sanctions. 

Sec. 104. Termination of sanctions. 

Sec. 105. Sunset. 

Sec. 106. Definitions. 

Sec. 107. Effective date. 

TITLE II—OFFICE OF GLOBAL SECURITY RISK IN THE 

SECURITIES AND EXCHANGE COMMISSION 

Sec. 201. Establishment of office. 

Sec. 202. Reports.

3 SEC. 2. FINDINGS. 

4 Congress makes the following findings: 

5 (1) On September 16, 2003, the Under Sec6 retary for Arms Control and International Security, 

7 John R. Bolton, stated before the Committee on 

8 International Relations of the House of Representa9 tives that: ‘‘Without question, among rogue states, 

10 those most aggressively seeking to acquire or develop 

11 weapons of mass destruction and their means of de12 livery, and which are therefore threats to our na13 tional security, are Iran and North Korea, followed 

14 by Libya and Syria. It is also the case that these 

15 states are among those we identify as state sponsors 

16 of terrorism.’’. 
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1 (2) In his statement before the International 

2 Atomic Energy Agency (IAEA) of the United Na3 tions on September 8, 2003, United States Ambas4 sador Kenneth Brill denounced Iran’s patterns of 

5 deception regarding its nuclear program by declaring 

6 Iran to be ‘‘working in secret, going back into the 

7 1980s, to develop sophisticated nuclear facilities; 

8 stalling, stonewalling, and on a number of occasions 

9 first providing the IAEA false information, and then 

10 changing its story when the original version was re11 vealed to be inaccurate; and attempting to cover up 

12 traces of its activities to avoid detection by the 

13 Agency’’. 

14 (3) The Final Resolution of the Board of Gov15 ernors of the International Atomic Energy Agency 

16 on September 11, 2003, noted with concern, ‘‘that 

17 the agency environmental sampling at Natanz has 

18 revealed the presence of two types of highly enriched 

19 uranium, which requires additional work to enable 

20 the Agency to arrive at a conclusion; that IAEA in21 spectors found considerable modifications had been 

22 made to the premises at the Kalaye Electric Com23 pany prior to inspections that may impact on the ac24 curacy of the environmental sampling; that some of 

25 Iran’s statements to the IAEA have undergone sig-
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1 nificant and material changes, and that the number 

2 of outstanding issues has increased since the report; 

3 and that despite the Board’s statement in June 

4 2003 encouraging Iran as a confidence-building 

5 measure, not to introduce nuclear material into its 

6 pilot centrifuge enrichment cascade at Natanz, Iran 

7 has introduced such material’’. 

8 (4) The Government of Iran, in a letter to the 

9 International Atomic Energy Agency of August 19, 

10 2003, acknowledged that, in the early 1990s, there 

11 had been ‘‘bench scale’’ uranium conversion experi12 ments. Iran has indicated that more time will be 

13 needed to find the people involved in these experi14 ments and to trace any other closed down facilities. 

15 (5) Iranian authorities have stated that none of 

16 the imported uranium had been processed and spe17 cifically, that it had not been used in any centrifuge 

18 tests. It was observed, however, during IAEA 

19 verification in March 2003, that some of the UF6

20 was in fact missing from the two small cylinders. 

21 (6)(A) Iranian authorities told the International 

22 Atomic Energy Agency that the decision to launch 

23 a centrifuge enrichment program had actually been 

24 taken in 1985 and that Iran had received drawings 
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1 of the centrifuge through a foreign intermediary 

2 around 1987. 

3 (B) The Iranian authorities described the pro4 gram as having consisted of three phases: activities 

5 during the first phase, from 1985 until 1997, had 

6 been located mainly at the Atomic Energy Organiza7 tion of Iran (AEOI) premises in Tehran; during the 

8 second phase, between 1997 and 2002, the activities 

9 had been concentrated at the Kalaye Electric Com10 pany in Tehran; during the third phase, 2002 to the 

11 present, the research and development and assembly 

12 activities were moved to the Natanz facility. 

13 (7) In the August 19, 2003, letter from Iran, 

14 the International Atomic Energy Agency was in15 formed that, in the past, apart from planned co-op16 eration in laser fusion and laser spectroscopy which 

17 never materialized, there had been a research thesis 

18 on laser spectroscopy prepared by a university stu19 dent in co-operation with the laser division of the 

20 Atomic Energy Organization of Iran. Such a study 

21 by the AEOI could later prove to be relevant to the 

22 implementation of laser enrichment programs in 

23 Iran. 

24 (8) In September 2003, Britain, France, and 

25 Germany nevertheless offered western technology to
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1 Iran if it stopped its nuclear fuel enrichment pro2 gram and accepted more intrusive United Nations 

3 inspections of its nuclear facilities, all in defiance of 

4 the United States efforts to achieve a united front 

5 to counter the burgeoning Iranian nuclear program. 

6 (9) European oil investment and credit provi7 sions have unquestionably helped the Iranian econ8 omy by enabling it to build its nuclear program. The 

9 Iranians are boasting that as much as 

10 $20,000,000,000 in oil agreements have been signed 

11 between Iran and European Union countries since 

12 1995. 

13 (10) France’s Totalfina formed a multi-billion 

14 dollar consortium to develop Iranian oil fields of 

15 South Pars in 1995 and has been adding to its de16 velopment ever since. Britain has issued credit guar17 antees to back up its oil investments in Iran as well. 

18 (11) Germany is actively seeking to increase its 

19 exports to Iran and in 2001 it quadrupled its export 

20 insurance to that country. The French bank BNP 

21 Paribas has arranged $2,230,000,000 in loans for 

22 Iran since 1990. 

23 (12) Europe has also been actively seeking a 

24 European Union–Iran trade pact, formally giving 

25 the go-ahead to pursue investments in Iran. 
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1 (13) The Assistant Secretary of State for Non2 proliferation, John S. Wolf, in testimony before the 

3 Committee on Foreign Relations of the Senate on 

4 March 19, 2003, stated that: ‘‘Libya has crossed the 

5 nuclear threshold and is among the list of nuclear 

6 wannabees. These wannabees seek nuclear weapons 

7 capabilities even though they are all parties to the 

8 [Treaty on the Non-Proliferation of Nuclear Weap9 ons].’’. 

10 (14) In testimony before the Select Committee 

11 on Intelligence of the Senate on February 10, 2003, 

12 the Director of Central Intelligence, George J. 

13 Tenet, remarked: ‘‘Libya clearly intends to reestab14 lish its offensive chemical weapons capability and 

15 has produced at least 100 tons of chemical agents 

16 at its Rabta facility.’’. 

17 (15) In addition to manufacturing and pos18 sessing chemical weapons, Libya has a history of 

19 employing them. According to the Department of 

20 Defense, in 1987 Libya employed chemical agents 

21 against troops from its neighboring country of Chad. 

22 Libya has used missiles and aircraft in combat. 

23 Libya also ‘‘fired SCUD missiles at an Italian island 

24 in 1987’’, according to the 2001 Department of De25 fense ‘‘Proliferation: Threat and Response’’ Report. 
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1 (16) According to the same report, Libya may 

2 be capable of producing small quantities of biological 

3 agents. And, ‘‘with the suspension of UN sanctions, 

4 Libya’s ability to acquire biological-related equip5 ment and expertise will increase’’. 

6 (17) The Government of Libya continues to 

7 seek ballistic missile delivery systems that could be 

8 used for chemical or nuclear warfare. On October 

9 31, 2002, the director of the United States Missile 

10 Defense Agency, Lieutenant General Ronald Kadish, 

11 stated: ‘‘The Libyans have been pretty active in try12 ing to get missile capability, and not just short13 range. They have enough money to buy it . . . We 

14 worry a lot about Libya in the Missile Defense 

15 Agency.’’. 

16 TITLE I—AMENDMENTS TO THE 

17 IRAN AND LIBYA SANCTIONS 

18 ACT OF 1996

19 SEC. 101. MULTILATERAL REGIME. 

20 (a) MULTILATERAL NEGOTIATIONS.—Section 4(a) of 

21 the Iran and Libya Sanctions Act of 1996 (50 U.S.C. 

22 1701 note) is amended—

23 (1) by inserting ‘‘and Libya’’ after ‘‘Iran’’; and 

24 (2) by striking ‘‘Iran’s efforts’’ and inserting 

25 ‘‘the efforts of both Iran and Libya’’. 
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1 (b) REPORTS TO CONGRESS.—Section 4(b) of the 

2 Iran and Libya Sanctions Act of 1996 (50 U.S.C. 1701 

3 note) is amended to read as follows: 

4 ‘‘(b) REPORTS TO CONGRESS.—The President shall 

5 prepare and transmit to the appropriate congressional 

6 committees not later than 6 months after the date of en7 actment of the ILSA Enhancement and Compliance Act, 

8 and once every 6 months thereafter, a report on the spe9 cific diplomatic efforts undertaken pursuant to subsection 

10 (a), the results of these efforts, and a description of pro11 posed diplomatic efforts pursuant to such subsection. 

12 Each report shall include—

13 ‘‘(1) the countries that have agreed to under14 take measures to further the objectives of section 3 

15 with respect to either Iran or Libya; 

16 ‘‘(2) a description of those measures, includ17 ing—

18 ‘‘(A) government actions with respect to 

19 public or private entities (or their subsidiaries) 

20 located in their territories, that are engaged in 

21 Iran or Libya; 

22 ‘‘(B) any decisions by the governments of 

23 these countries to rescind or continue the provi24 sion of credits, guarantees, or other govern25 mental assistance to these entities; and 
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1 ‘‘(C) actions taken in international fora to 

2 further the objectives of section 3; and 

3 ‘‘(3) the countries that have not agreed to un4 dertake measures to further the objectives of section 

5 3 with respect to Iran or Libya, and the reasons 

6 therefor.’’. 

7 (c) SUSPENSION.—Section 4(c) of the Iran and Libya 

8 Sanctions Act of 1996 (50 U.S.C. 1701 note) is amended 

9 to read as follows: 

10 ‘‘(c) SUSPENSION.—The President may suspend the 

11 application of section 5(a) with respect to nationals of a 

12 country on a case by case basis for a period of not more 

13 than 6 months, if the President certifies to the appropriate 

14 congressional committees at least 30 days before the sus15 pension is to take effect that—

16 ‘‘(1) the suspension is vital to the national secu17 rity of the United States; and 

18 ‘‘(2) the country has undertaken substantial 

19 measures, including economic sanctions, to prevent 

20 the acquisition and development of weapons of mass 

21 destruction by the Government of Iran or Libya, as 

22 the case may be, and to carry out activities de23 scribed in section 2 of this Act.’’. 

24 (d) INVESTIGATIONS.—Section 4 of the Iran and 

25 Libya Sanctions Act of 1996 (50 U.S.C. 1701 note) is
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1 amended by adding at the end the following new sub2 section: 

3 ‘‘(f) INVESTIGATIONS.—

4 ‘‘(1) IN GENERAL.—Upon public or private dis5 closure of activity related to investment in Iran or 

6 Libya as described in this Act, the President shall 

7 direct the Secretary of the Treasury to initiate an 

8 investigation into the possible imposition of sanc9 tions with respect to such activity and to provide a 

10 recommendation to the President for such purposes. 

11 ‘‘(2) DETERMINATION AND NOTIFICATION.—

12 Not later than 90 days after the date of the disclo13 sure of activity described in paragraph (1), the 

14 President shall make a determination whether or not 

15 to impose sanctions with respect to the activity and 

16 shall notify the appropriate congressional committees 

17 of the basis for this determination.’’. 

18 SEC. 102. IMPOSITION OF SANCTIONS. 

19 (a) SANCTIONS WITH RESPECT TO DEVELOPMENT

20 OF PETROLEUM RESOURCES.—Section 5(a) of the Iran 

21 and Libya Sanctions Act of 1996 (50 U.S.C. 1701 note) 

22 is amended—

23 (1) in the heading, by striking ‘‘TO IRAN’’ and 

24 inserting ‘‘TO DEVELOPMENT OF PETROLEUM RE25 SOURCES’’; 
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1 (2) by striking ‘‘, with actual knowledge,’’; and 

2 (3) by striking ‘‘Iran’s ability to develop petro3 leum resources in Iran’’ and inserting ‘‘the ability of 

4 Iran or Libya to develop petroleum resources, as the 

5 case may be’’. 

6 (b) SANCTIONS WITH RESPECT TO DEVELOPMENT

7 OF WEAPONS OF MASS DESTRUCTION OR OTHER MILI8 TARY CAPABILITIES.—Section 5(b) of the Iran and Libya 

9 Sanctions Act of 1996 (50 U.S.C. 1701 note) is amended 

10 to read as follows: 

11 ‘‘(b) MANDATORY SANCTIONS WITH RESPECT TO

12 DEVELOPMENT OF WEAPONS OF MASS DESTRUCTION OR

13 OTHER MILITARY CAPABILITIES.—Notwithstanding any 

14 other provision of law, the President shall impose 2 or 

15 more of the sanctions described in paragraphs (1) through 

16 (6) of section 6 if the President determines that a person 

17 has, on or after the date of the enactment of this Act, 

18 exported, transferred, or otherwise provided to Iran or 

19 Libya any goods, services, technology, or other items the 

20 provision of which significantly and materially—

21 ‘‘(1) contributed to the ability of Iran or Libya 

22 to acquire chemical, biological, or nuclear weapons 

23 or destabilizing numbers and types of advanced con24 ventional weapons or enhanced the military or para25 military capabilities of Iran or Libya; or 
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1 ‘‘(2) contributed to the ability of Iran or Libya 

2 to maintain its aviation capabilities.’’. 

3 (c) PERSONS AGAINST WHICH THE SANCTIONS ARE

4 TO BE IMPOSED.—Section 5(c)(2) of the Iran and Libya 

5 Sanctions Act of 1996 (50 U.S.C. 1701 note) is amend6 ed—

7 (A) in subparagraph (B), by striking ‘‘or’’ 

8 at the end; 

9 (B) in subparagraph (C), by striking the 

10 period and inserting ‘‘; or’’; and 

11 (C) by adding at the end the following new 

12 subparagraph: 

13 ‘‘(D) is a private or government lender, in14 surer, underwriter, re-insurer, or guarantor of 

15 the person referred to in paragraph (1).’’. 

16 SEC. 103. DESCRIPTION OF SANCTIONS. 

17 Paragraphs (1) through (6) of section 6 of the Iran 

18 and Libya Sanctions Act 1996 (50 U.S.C. 1701 note) is 

19 amended by striking ‘‘may’’ each place it occurs and in20 serting ‘‘shall’’. 

21 SEC. 104. TERMINATION OF SANCTIONS. 

22 Section 8 of the Iran and Libya Sanctions Act 1996 

23 (50 U.S.C. 1701 note) is amended—

24 (1) in subsection (a)—

25 (A) by striking the heading;
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1 (B) in the introductory matter preceding 

2 paragraph (1)—

3 (i) by inserting ‘‘or Libya’’ after 

4 ‘‘Iran’’ the first place it appears; and 

5 (ii) by inserting ‘‘or Libya, as the case 

6 may be’’ after ‘‘Iran’’ the second place it 

7 appears; 

8 (C) in paragraph (1)(C), by striking ‘‘and’’ 

9 at the end; 

10 (D) in paragraph (2), by striking the pe11 riod at the end and inserting ‘‘; and’’; and 

12 (E) by adding at the end the following: 

13 ‘‘(3) poses no threat to the national security of 

14 the United States, its interests, or allies.’’; and 

15 (2) by striking subsection (b). 

16 SEC. 105. SUNSET. 

17 Section 13 of the Iran and Libya Sanctions Act of 

18 1996 (50 U.S.C. 1701 note) is hereby repealed. 

19 SEC. 106. DEFINITIONS. 

20 (a) INVESTMENT.—Section 14(9) of the Iran and 

21 Libya Sanctions Act of 1996 (50 U.S.C. 1701 note) is 

22 amended in the last sentence by striking ‘‘does not in23 clude’’ and inserting ‘‘includes’’. 
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1 (b) PERSON.—Section 14(14)(B) of the Iran and 

2 Libya Sanctions Act of 1996 (50 U.S.C. 1701 note) is 

3 amended—

4 (1) by inserting after ‘‘trust’’ the following: ‘‘, 

5 financial institution, insurer, underwriter, re-insurer, 

6 guarantors’’; and 

7 (2) by striking ‘‘operating as a business enter8 prise’’. 

9 (c) PETROLEUM RESOURCES.—Section 14(15) of the 

10 Iran and Libya Sanctions Act of 1996 (50 U.S.C. 1701 

11 note) is amended—

12 (1) by striking ‘‘and’’ and inserting a comma; 

13 and 

14 (2) by inserting ‘‘, and petroleum by-products’’ 

15 after ‘‘resources’’. 

16 SEC. 107. EFFECTIVE DATE. 

17 The amendments made by sections 102 and 103 shall 

18 apply to investments made on or after the date of the en19 actment of this Act. 
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1 TITLE II—OFFICE OF GLOBAL 

2 SECURITY RISK IN THE SECU3 RITIES AND EXCHANGE COM4 MISSION 

5 SEC. 201. ESTABLISHMENT OF OFFICE. 

6 The Securities and Exchange Commission shall es7 tablish an Office of Global Security Risk within the Divi8 sion of Corporation Finance. The duties of this office shall 

9 include, but will not be limited to: 

10 (1) Establishing a process by which the Com11 mission identifies all issuers (as defined in section 

12 2(a)(7) of the Sarbanes-Oxley Act of 2002 (15 

13 U.S.C. 7201(a)(7))) that are operating in countries, 

14 particularly Iran and Libya, the governments of 

15 which the Secretary of State has determined, for 

16 purposes of section 6(j)(1) of the Export Adminis17 tration Act of 1979 (50 U.S.C. app. 2405(j)(1)), 

18 have repeatedly provided support for acts of inter19 national terrorism. 

20 (2) Ensuring that all issuers operating in coun21 tries described in paragraph (1) are disclosing to in22 vestors the nature of their operations in such coun23 tries. 

24 (3) Implementing enhanced disclosure require25 ments based on the asymmetric nature of the risk to 
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1 corporate share value and reputation stemming from 

2 business interests in these higher risk countries. 

3 (4) Coordinating with other government agen4 cies to ensure the sharing of relevant information 

5 across the Federal Government. 

6 (5) Initiating a global dialogue to ensure that 

7 foreign corporations whose shares are traded in the 

8 United States are properly disclosing their activities 

9 in countries described in paragraph (1) to United 

10 States investors. 

11 SEC. 202. REPORTS. 

12 The Commission shall provide the appropriate Con13 gressional committees with quarterly reports on the activi14 ties of Office of Global Security Risk established pursuant 

15 to section 201.

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