U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1

89–011 2001

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


E:\Seals\Congress.#13 Q69

E:\Seals\Congress.#13 Q69
(1)

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.

(3)

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.

4

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 sixmonth 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.

Æ