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[House Document 107-77]
[From the U.S. Government Publishing Office]

                                     

107th Congress, 1st Session - - - - - - - - - - - - - House Document 107-77

 
 SIX MONTH PERIODIC REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO 
             YUGOSLAVIA (SERBIA AND MONTENEGRO) AND KOSOVO

                               __________

                                MESSAGE

                                  from

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

 A SIX MONTH PERIODIC REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO 
THE FEDERAL REPUBLIC OF YUGOSLAVIA (SERBIA AND MONTENEGRO) DECLARED IN 
 EXECUTIVE ORDER 12808 ON MAY 30, 1992 AND WITH RESPECT TO THE KOSOVO 
 EMERGENCY DECLARED IN EXECUTIVE ORDER 13088 ON JUNE 9, 1998, PURSUANT 
                          TO 50 U.S.C. 1703(c)

    May 25, 2001.--Message and accompanying papers referred to the 
     Committee on International Relations and ordered to be printed
To the Congress of the United States:
    As required by section 401(c) of the National Emergencies 
Act, 50 U.S.C. 1641(c) and section 204(c) of the International 
Emergency Economic Powers Act (IEEPA), 50 U.S.C. 1703(c), I 
transmit herewith a 6-month periodic report on the national 
emergency with respect to the Yugoslavia (Serbia and 
Montenegro) emergency declared in Executive Order 12808 on May 
30, 1992, and with respect to the Kosovo emergency declared in 
Executive Order 13088 on June 9, 1998.

                                                    George W. Bush.
    The White House, May 24, 2001.
President's Periodic Report on the National Emergencies With Respect to 
  the Federal Republic of Yugoslavia (Serbia & Montenegro) and Kosovo

    I hereby report to the Congress on developments over the 
course of the past six months concerning the national emergency 
with respect to the Federal Republic of Yugoslavia (Serbia and 
Montenegro) (the ``FRY (S&M)'') that was declared in Executive 
Order 12808 on May 30, 1992, as supplemented by Executive 
Orders 12810, 12831, and 12846, issued on June 5, 1992, January 
15, 1993, and April 25, 1993, respectively, and as expanded in 
Executive Order 12934, issued on October 25, 1994, with respect 
to the Bosnian Serbs. I am also reporting to the Congress on 
developments over the course of the past six months concerning 
the national emergency with respect to the FRY (S&M) and Kosovo 
that was declared in Executive Order 13088 on June 9, 1998, as 
supplemented by Executive Order 13121, issued on April 30, 
1999, and as amended in Executive Order 13192 of January 17, 
2001. The present report is submitted pursuant to 50 U.S.C. 
1641(c) and 1703(c), covers the period from November 30, 2000 
through May 29, 2001, and discusses Administration actions and 
expenses directly related to the exercise of powers and 
authorities conferred by these national emergency declarations.
    With regard to the national emergency declared in 1992, the 
Office of Foreign Assets Control (``OFAC'') has continued 
during the past six months to oversee the maintenance of FRY 
(S&M) accounts blocked pursuant to 31 CFR Part 585, and records 
with respect to: (1) liquidated tangible assets and personalty 
of the fifteen blocked U.S. subsidiaries of entities organized 
in the FRY (S&M); (2) the blocked personalty, files, and 
records of the two Serbian banking institutions in New York 
previously placed in secure storage; and (3) remaining blocked 
FRY (S&M) tangible property, including real estate. The 
Departments of State and the Treasury continue to work closely 
with European Union member states and other UN member nations 
to implement the provisions of United Nations Security Council 
Resolutions 1022 and 1074 regarding the status of assets 
subject to claims and encumbrances previously blocked under 
that authority.
    With regard to the national emergency declared in 1998, 
following the peaceful democratic transition begun in the FRY 
(S&M), the President issued Executive Order 13192 on January 
17, 2001, amending Executive Order 13088 to lift and modify, 
with respect to future transactions, most of the economic 
sanctions imposed against the FRY (S&M). Executive Order 13192 
imposes restrictions on transactions with certain persons 
described in Section 1(a) of the Order, namely Slobodan 
Milosevic, his close supporters and persons under open 
indictment for war crimes by the International Criminal 
Tribunal for the former Yugoslavia (``ICTY''). It also provides 
for the continued blocking of property or interests in property 
blocked prior to the Order's effective date pending resolution 
of claims and encumbrances, until unblocked in accordance with 
applicable law.
    Further information with regard to the national emergencies 
declared in 1992 and 1998 is provided below.
    1. OFAC is preparing regulations with respect to Executive 
Order 13192.
    2. During this reporting period, OFAC issued a total of 108 
specific licenses pursuant to either the Federal Republic of 
Yugoslavia (Serbia & Montenegro) Kosovo Sanctions Regulations 
(the ``Regulations''), 31 CFR Part 586, or the regulations 
implementing the 1992 sanctions program. Specific licenses were 
issued to: (1) unblock wire transfers involving generally 
smallamounts of individuals' purely personal funds; (2) authorize the 
settlement of pending legal actions and receipt of payment for legal 
services; (3) authorize certain transactions relating to air safety 
policy; (4) authorize exports of energy supplies to the UN mission in 
Kosovo; and (5) authorize imports pending implementation of the new 
Executive order. Five additional OFAC registrations of nongovernmental 
agencies providing humanitarian assistance have been made since the 
last report. Thus, the total of such registrations since the inception 
of the program is 55.
    Pursuant to the Regulations, OFAC blocked 132 transactions 
totaling more than $26.7 million during this reporting period. 
Most of the blockings were of funds transfers originating from, 
or destined for, Serbian banks. In addition, 282 funds 
transfers totaling more than $12 million were rejected by U.S. 
banking institutions as contrary to U.S. sanctions.
    Since the last report, OFAC has collected three civil 
monetary penalties totaling more than $10,100 for violations of 
the sanctions. These violations involved payments either to the 
Government of the FRY (S&M), persons in the FRY (S&M), or to 
blocked entities owned or controlled by the Government of the 
FRY (S&M), as well as the unauthorized export of services to 
the FRY (S&M). The violators included one U.S. financial 
institution, one company, and one individual. An additional 
case is undergoing penalty action for violation of the 1992 
sanctions program and an additional 64 cases are undergoing 
penalty action for violation of the Regulations.
    3. The trial of a resident alien, along with his company, 
who were named in a February 16, 2000, 40-count indictment in 
the Central District of California, has been rescheduled for 
June 2001. The indictment alleged unauthorized sales and 
exportation from the United States of aircraft parts to 
Jugoslovenski Aerotransport (``JAT'') in the FRY (S&M) and 
further alleged conspiracy with U.S. persons to acquire U.S.-
manufactured aircraft parts from certain U.S. companies for 
resale and exportation to JAT. The defendant allegedly shipped 
the aircraft parts to JAT in third countries with the knowledge 
that they would be transshipped to the FRY (S&M) without 
authorization by the United States Government. Trial was 
originally scheduled for February 2001.
    4. The expenses incurred by the Federal Government in the 
six-month period from November 29, 2000 through May 30, 2001 
that are directly attributable to the declaration of the 
national emergencies in Executive Orders 12808 and 13088 are 
estimated at approximately $500,000, most of which represents 
wage and salary costs for Federal personnel. Personnel costs 
were largely centered in the Department of the Treasury 
(particularly in OFAC, the Chief Counsel's Office (Office of 
Foreign Assets Control), and the U.S. Customs Service), the 
Department of State, the National Security Council, and the 
Department of Commerce.
    5. It is in the United State's foreign policy interest to 
support Yugoslavia's newly democratically elected government as 
they work toward building a society based on democratic ideals. 
We also have a strong interest in avoiding prejudice to the 
claims of successor States of the former Socialist Federal 
Republic of Yugoslavia with respect to previously blocked funds 
and assets. Further, we will ensure that sanctions-lifting 
measures do not allow supporters of Milosevic to continue the 
systematic theft of resources that have marked the last 
thirteen years.
    With regard to the national emergency declared in 1992, I 
shall continue to exercise the powers at my disposal with 
respect to this emergency until the status of all remaining 
blocked property is resolved, the Dayton Peace Agreement, is 
implemented, and the terms of United Nations Security Council 
Resolution 1022 are met. With regard to the national emergency 
declared in 1998, I shall continue to exercise the powers at my 
disposal with respect to this emergency until the crisis with 
respect to the situation in Kosovo, and with respect to 
Slobodan Milosevic, his close associates and supporters and 
persons under open indictment for war crimes by ICTY, and with 
respect to property previously blocked has been resolved, as 
long as these measures are appropriate. I will continue to 
report periodically to the Congress on significant developments 
pursuant to 50 U.S.C. 1703(c).

                                
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