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[House Document 107-110]
[From the U.S. Government Publishing Office]

                                     

 107th Congress, 1st Session - - - - - - - - - - House Document 107-110

 
                   SIX MONTH PERIODIC REPORT ON THE
                NATIONAL EMERGENCY WITH RESPECT TO IRAQ

                               __________

                                MESSAGE

                                  FROM

                   THE PRESIDENT OF THE UNITED STATES

                              Transmitting

 A 6-MONTH REPORT ON THE NATIONAL EMERGENCY WITH RESPECT TO IRAQ THAT 
WAS DECLARED IN EXECUTIVE ORDER 12722 OF AUGUST 2, 1990, PURSUANT TO 50 
                             U.S.C. 1622(d)

    July 31, 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, 50 U.S.C. 1703(c), I transmit 
herewith a 6-month report on the national emergency with 
respect to Iraq that was declared in Executive Order 12722 of 
August 2, 1990.

                                                    George W. Bush.
    The White House, July 31, 2001.
 President's Periodic Report on the National Emergency With Respect to 
                                  Iraq

    I hereby report to the Congress on the developments over 
the course of the past six months concerning the national 
emergency with respect to Iraq that was declared in Executive 
Order 12722 of August 2, 1990, and matters relating to 
Executive Order 12724 of August 9, 1990, and Executive Order 
12817 of October 23, 1992. This report is submitted pursuant to 
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, 50 U.S.C. 1703(c) (``IEEPA'').
    1. There have been no amendments to the Iraqi Sanctions 
Regulations, 31 C.F.R. Part 575 (the ``Regulations''), during 
the current reporting period.
    2. Since December 10, 1996, the Office of Foreign Assets 
Control (OFAC) has issued specific licenses authorizing 
participation by U.S. persons in commercial sales of 
humanitarian goods to Iraq funded by Iraqi oil sales, and 
imports of Iraqi petroleum products, pursuant to United Nations 
Security Council Resolution (``UNSCR'') 986 and succeeding 
resolutions. The total value of humanitarian sales since 1996 
is approximately $647 million. Of this amount, OFAC licenses 
have authorized sales of about $462 million in basic 
foodstuffs, nearly $50 million for medicines and medical 
supplies, more than $120 million for water testing and treating 
equipment, irrigation systems, and other infrastructure 
components essential to the delivery to the Iraqi people of 
food, medicine and other necessities of life, and approximately 
$15 million to fund a variety of United Nations activities in 
Iraq. During the current reporting period, as of June 15, 2001, 
OFAC-authorized humanitarian sales were valued at nearly $60 
million.
    In addition, sales of oil infrastructure merchandise 
authorized since November 10, 1998, in conformity with UNSCRs 
1153 and 1175, were valued at approximately $114 million. OFAC 
issued 124 licenses during the reporting period for the sale of 
oilfield parts and equipment to the Government of Iraq.
    Finally, an additional 16 licenses were issued authorizing 
certain diplomatic and travel transactions, the provision of 
legal services (including the protection of intellectual 
property), and the unblocking of wire transfer transactions 
where it was determined that there was no interest of the 
Government of Iraq.
    3. As of June 13, 2001, 30 transactions totaling 
approximately $3 million were blocked during the reporting 
period. One hundred and thirty-five transactions, not involving 
blockable interests, were rejected by U.S. banks causing a 
disruption of more than $12 million in business for Iraq.
    4. Since the last report, OFAC has collected two civil 
monetary penalties totaling more than $9,500 for violations of 
the sanctions. One U.S. financial institution and one 
individual paid the penalties for violations involving a 
payment relating to Iraq and an attempted export of goods to 
Iraq. An additional twenty-three cases were undergoing agency 
penalty or debt collection action for violation of the 
Regulations.
    5. On February 15, 2001, in the Southern District of 
California, three foreign businessmen pleaded guilty to charges 
resulting from their entry into the United States to complete 
the unauthorized purchase of 160,000 metric tons of oil from 
Iraq. Two defendants pleaded guilty to conspiracy to deal and 
engage in activity promoting dealing in oil of Iraqi origin in 
violation of IEEPA and the Regulations. The third defendant 
pleaded guilty to illegally importing money into the United 
States. All three have been sentenced and deported from the 
United States.
    6. The expenses incurred by the Federal Government in the 
six-month period from February 2 through August 1, 2001, that 
are directly attributable to the exercise of powers and 
authorities conferred by the declaration of a national 
emergency with respect to Iraq, are reported to be about 
$1,100,000, most of which represent wage and salary costs for 
Federal personnel. Personnel costs were largely centered in the 
Department of the Treasury (particularly in the Office of 
Foreign Assets Control, the U.S. Customs Service, the Office of 
the Under Secretary for Enforcement, and the Office of the 
General Counsel), and the Department of State (particularly the 
Bureau of Economic and Business Affairs, the Bureau of Near 
Eastern Affairs, the Bureau of International Organization 
Affairs, the Bureau of Political-Military Affairs, the Bureau 
of Intelligence and Research, the U.S. Mission to the United 
Nations, and the Office of the Legal Adviser).
    7. The United States imposed economic sanctions on Iraq in 
response to Iraq's illegal invasion and occupation of Kuwait, a 
clear act of brutal aggression. The United States, together 
with the international community, is maintaining economic 
sanctions against Iraq because the Iraqi regime has failed to 
comply fully with relevant United Nations Security Council 
resolutions. Iraqi compliance with these resolutions is 
necessary before the United States will consider lifting 
economic sanctions.
    The policies and actions of the Saddam Hussein regime 
continue to pose an unusual and extraordinary threat to the 
national security and foreign policy of the United States, as 
well as to regional peace and security. The Security Council 
resolutions affirm that the Security Council review Iraq's 
policies and practices in judging Iraq's compliance with those 
resolutions. Because of Iraq's failure to comply with these 
resolutions, the United States will continue to apply economic 
sanctions to deter it from threatening peace and stability in 
the region.

                                
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