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[House Report 111-342]
[From the U.S. Government Publishing Office]

111th Congress                                            Rept. 111-342
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================

 
              IRAN REFINED PETROLEUM SANCTIONS ACT OF 2009

                                _______
                                

               November 19, 2009.--Ordered to be printed

                                _______
                                

   Mr. Berman, from the Committee on Foreign Affairs, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 2194]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Foreign Affairs, to whom was referred the 
bill (H.R. 2194) to amend the Iran Sanctions Act of 1996 to 
enhance United States diplomatic efforts with respect to Iran 
by expanding economic sanctions against Iran, having considered 
the same, report favorably thereon with an amendment and 
recommend that the bill as amended do pass.

                           TABLE OF CONTENTS

                                                                   Page
The Amendment....................................................     1
Summary and Purpose..............................................     8
Background and Need for the Legislation..........................     8
Hearings.........................................................    11
Committee Consideration..........................................    11
Votes of the Committee...........................................    11
Committee Oversight Findings.....................................    11
New Budget Authority and Tax Expenditures........................    12
Congressional Budget Office Cost Estimate........................    12
Performance Goals and Objectives.................................    14
Constitutional Authority Statement...............................    14
New Advisory Committees..........................................    14
Congressional Accountability Act.................................    14
Earmark Identification...........................................    14
Section-by-Section Analysis and Discussion.......................    14
Changes in Existing Law Made by the Bill, as Reported............    20

                             The Amendment

  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Iran Refined Petroleum Sanctions Act 
of 2009''.

SEC. 2. FINDINGS; SENSE OF CONGRESS; STATEMENT OF POLICY.

    (a) Findings.--Congress finds the following:
            (1) The illicit nuclear activities of the Government of 
        Iran--combined with its development of unconventional weapons 
        and ballistic missiles, and support for international 
        terrorism--represent a serious threat to the security of the 
        United States and U.S. allies in Europe, the Middle East, and 
        around the world.
            (2) The United States and other responsible nations have a 
        vital interest in working together to prevent the Government of 
        Iran from acquiring a nuclear weapons capability.
            (3) The International Atomic Energy Agency has repeatedly 
        called attention to Iran's unlawful nuclear activities, and, as 
        a result, the United Nations Security Council has adopted a 
        range of sanctions designed to encourage the Government of Iran 
        to suspend those activities and comply with its obligations 
        under the Treaty on the Non-Proliferation of Nuclear Weapons 
        (commonly known as the ``Nuclear Non-Proliferation Treaty'').
            (4) As a presidential candidate, then-Senator Obama stated 
        that additional sanctions, especially those targeting Iran's 
        dependence on imported refined petroleum, may help to persuade 
        the Government of Iran to abandon its illicit nuclear 
        activities.
            (5) On October 7, 2008, then-Senator Obama stated, ``Iran 
        right now imports gasoline, even though it's an oil producer, 
        because its oil infrastructure has broken down. If we can 
        prevent them from importing the gasoline that they need and the 
        refined petroleum products, that starts changing their cost-
        benefit analysis. That starts putting the squeeze on them.''.
            (6) On June 4, 2008, then-Senator Obama stated, ``We should 
        work with Europe, Japan, and the Gulf states to find every 
        avenue outside the U.N. to isolate the Iranian regime--from 
        cutting off loan guarantees and expanding financial sanctions, 
        to banning the export of refined petroleum to Iran.''.
            (7) Major European allies, including the United Kingdom, 
        France, and Germany, have advocated that sanctions be 
        significantly toughened should international diplomatic efforts 
        fail to achieve verifiable suspension of Iran's uranium 
        enrichment program and an end to its nuclear weapons program 
        and other illicit nuclear activities.
            (8) The serious and urgent nature of the threat from Iran 
        demands that the United States work together with U.S. allies 
        to do everything possible--diplomatically, politically, and 
        economically--to prevent Iran from acquiring a nuclear weapons 
        capability.
            (9) The human rights situation in Iran has steadily 
        deteriorated in 2009, as punctuated by the transparent fraud 
        that occurred on June 12, the brutal repression and murder, 
        arbitrary arrests, and show trials of peaceful dissidents, and 
        ongoing suppression of freedom of expression.
    (b) Sense of Congress.--It is the sense of the Congress that--
            (1) international diplomatic efforts to address Iran's 
        illicit nuclear efforts, unconventional and ballistic missile 
        development programs, and support for international terrorism 
        are more likely to be effective if the President is empowered 
        with the explicit authority to impose additional sanctions on 
        the Government of Iran;
            (2) the concerns of the United States regarding Iran are 
        strictly the result of the actions of the Government of Iran;
            (3) the revelation in September 2009 that Iran is 
        developing a secret uranium enrichment site on an Islamic 
        Revolutionary Guard Corps base near Qom, which appears to have 
        no civilian application, highlights the urgency for Iran to 
        fully disclose the full nature of its nuclear program, 
        including any other secret locations, and provide the 
        International Atomic Energy Agency (IAEA) unfettered access to 
        its facilities pursuant to Iran's legal obligations under the 
        Treaty on the Non-Proliferation of Nuclear Weapons and Iran's 
        Safeguards Agreement with the IAEA;
            (4) because of its involvement in Iran's nuclear program 
        and other destabilizing activities, the President should impose 
        sanctions, including the full range of sanctions otherwise 
        applicable to Iran, on any individual or entity that is an 
        agent, alias, front, instrumentality, representative, official, 
        or affiliate of the Islamic Revolutionary Guard Corps or is an 
        individual serving as a representative of the Islamic 
        Revolutionary Guard Corps, or on any person that has conducted 
        any commercial transaction or financial transaction with such 
        entities;
            (5) Government to Government agreements with Iran to 
        provide the regime with refined petroleum products, such as the 
        September 2009 agreement under which the Government of 
        Venezuela committed to provide 20,000 barrels of gasoline per 
        day to Iran, undermine efforts to pressure Iran to suspend its 
        nuclear weapons program and cease all enrichment activities; 
        and
            (6) the people of the United States--
                    (A) have feelings of friendship for the people of 
                Iran; and
                    (B) hold the people of Iran, their culture, and 
                their ancient and rich history in the highest esteem.
    (c) Statement of Policy.--It shall be the policy of the United 
States--
            (1) to prevent Iran from achieving the capability to make 
        nuclear weapons, including by supporting international 
        diplomatic efforts to halt Iran's uranium enrichment program;
            (2) to fully implement and enforce the Iran Sanctions Act 
        of 1996 as a means of encouraging foreign governments to--
                    (A) direct state-owned entities to cease all 
                investment in, and support of, Iran's energy sector and 
                all exports of refined petroleum products to Iran; and
                    (B) require private entities based in their 
                territories to cease all investment in, and support of, 
                Iran's energy sector and all exports of refined 
                petroleum products to Iran;
            (3) to impose sanctions on--
                    (A) the Central Bank of Iran, and any other 
                financial institution in Iran that is engaged in 
                proliferation activities or support of terrorist 
                groups, and
                    (B) any other financial institution that conducts 
                financial transactions with the Central Bank of Iran or 
                with another financial institution described in 
                subparagraph (A),
        including through the use of Executive Orders 13224, 13382, and 
        13438 and United Nations Security Council Resolutions 1737, 
        1747, 1803, and 1835;
            (4) to persuade the allies of the United States and other 
        countries to take appropriate measures to deny access to the 
        international financial system by Iranian banks and financial 
        institutions involved in proliferation activities or support of 
        terrorist groups;
            (5) to support all Iranian citizens who embrace the values 
        of freedom, human rights, civil liberties, and the rule of law; 
        and
            (6) for the Secretary of State to make every effort to 
        assist United States citizens held hostage in Iran at any time 
        during the period beginning on November 4, 1979 and ending on 
        January 20, 1981, and their survivors in matters of 
        compensation related to such citizens' detention.

SEC. 3. AMENDMENTS TO THE IRAN SANCTIONS ACT OF 1996.

    (a) Expansion of Sanctions.--Section 5(a) of the Iran Sanctions Act 
of 1996 (50 U.S.C. 1701 note) is amended to read as follows:
    ``(a) Sanctions With Respect to the Development of Petroleum 
Resources of Iran and Exportation of Refined Petroleum to Iran.--
            ``(1) Development of petroleum resources of iran.--
                    ``(A) Investment.--Except as provided in subsection 
                (f), the President shall impose 2 or more of the 
                sanctions described in paragraphs (1) through (6) of 
                section 6(a) if the President determines that a person 
                has knowingly, on or after the date of the enactment of 
                this Act, made an investment of $20,000,000 or more (or 
                any combination of investments of at least $5,000,000 
                each, which in the aggregate equals or exceeds 
                $20,000,000 in any 12-month period), that directly and 
                significantly contributed to the enhancement of Iran's 
                ability to develop petroleum resources of Iran.
                    ``(B) Production of refined petroleum products.--
                Except as provided in subsection (f), the President 
                shall impose the sanctions described in section 6(b) if 
                the President determines that a person knowingly sells, 
                leases, or provides to Iran any goods, services, 
                technology, information, or support, or enters into a 
                contract to sell, lease, or provide to Iran any goods, 
                services, technology, information, or support, that 
                would allow Iran to maintain or expand its domestic 
                production of refined petroleum products, including any 
                assistance in the construction, modernization, or 
                repair of refineries that make refined petroleum 
                products, if--
                            ``(i) the value of the goods, services, 
                        technology, information, or support provided in 
                        such sale, lease, or provision, or to be 
                        provided in such contract, exceeds $200,000; or
                            ``(ii) the value of the goods, services, 
                        technology, information, or support provided in 
                        any combination of such sales, leases, or 
                        provision in any 12-month period, or to be 
                        provided under contracts entered into in any 
                        12-month period, exceeds $500,000.
            ``(2) Exportation of refined petroleum products to iran.--
                    ``(A) In general.--Except as provided in subsection 
                (f), the President shall impose the sanctions described 
                in section 6(b) if the President determines that a 
                person knowingly provides Iran with refined petroleum 
                products or engages in any of the activities described 
                in subparagraph (B), if--
                            ``(i) the value of such products or of the 
                        goods, services, technology, information, or 
                        support provided or to be provided in 
                        connection with such activity exceeds $200,000; 
                        or
                            ``(ii) the value of such products, or of 
                        the goods, services, technology, information, 
                        or support, provided or to be provided in 
                        connection with any combination of providing 
                        such products or such activities, in any 12-
                        month period exceeds $500,000.
                    ``(B) Activities described.--The activities 
                referred to in subparagraph (A) are the following:
                            ``(i) Providing ships, vehicles, or other 
                        means of transportation to deliver refined 
                        petroleum products to Iran, or providing 
                        services relating to the shipping or other 
                        transportation of refined petroleum products to 
                        Iran.
                            ``(ii) Underwriting or otherwise providing 
                        insurance or reinsurance for an activity 
                        described in clause (i).
                            ``(iii) Financing or brokering an activity 
                        described in clause (i).''.
    (b) Description of Sanctions.--Section 6 of such Act is amended--
            (1) by striking ``The sanctions to be imposed on a 
        sanctioned person under section 5 are as follows:'' and 
        inserting the following:
    ``(a) In General.--The sanctions to be imposed on a sanctioned 
person under subsections (a)(1)(A) and (b)(1) of section 5 are as 
follows:'';
            (2) in paragraph (4), by striking ``section 5'' each place 
        it appears and inserting ``subsections (a)(1)(A) and (b) of 
        section 5''; and
            (3) by adding at the end the following:
    ``(b) Additional Mandatory Sanctions.--The sanctions to be imposed 
on a sanctioned person under paragraphs (1)(B) and (2) of section 5(a) 
are as follows:
            ``(1) Foreign exchange.--The President shall prohibit any 
        transactions in foreign exchange by the sanctioned person.
            ``(2) Banking transactions.--The President shall prohibit 
        any transfers of credit or payments between, by, through, or to 
        any financial institution, to the extent that such transfers or 
        payments involve any interest of the sanctioned person.
            ``(3) Property transactions.--The President shall prohibit 
        any acquisition, holding, withholding, use, transfer, 
        withdrawal, transportation, importation, or exportation of, 
        dealing in, or exercising any right, power, or privilege with 
        respect to, or transactions involving, any property in which 
        the sanctioned person has any interest by any person, or with 
        respect to any property, subject to the jurisdiction of the 
        United States.
    ``(c) Additional Measure Relating to Refined Petroleum Products.--
            ``(1) In general.--The head of each executive agency shall 
        ensure that each contract with a person entered into by such 
        executive agency for the procurement of goods or services, or 
        agreement for the use of Federal funds as part of a grant, 
        loan, or loan guarantee to a person, includes a clause that 
        requires the person to certify to the contracting officer or 
        other appropriate official of such agency that the person does 
        not conduct any activity described in paragraph (1)(B) or (2) 
        of section 5(a).
            ``(2) Remedies.--
                    ``(A) In general.--If the head of the executive 
                agency determines that such person has submitted a 
                false certification under paragraph (1) after the date 
                on which the Federal Acquisition Regulation is revised 
                to implement the requirements of this subsection, the 
                head of an executive agency may terminate a contract, 
                or agreement described in paragraph (1), with such 
                person or debar or suspend such person from eligibility 
                for Federal contracts or such agreements for a period 
                not to exceed 15 years.
                    ``(B) Inclusion on list of parties excluded from 
                federal procurement and nonprocurement programs.--The 
                Administrator of General Services shall include on the 
                List of Parties Excluded from Federal Procurement and 
                Nonprocurement Programs maintained by the Administrator 
                under part 9 of the Federal Acquisition Regulation 
                issued under section 25 of the Office of Federal 
                Procurement Policy Act (41 U.S.C. 421) each person that 
                is debarred, suspended, proposed for debarment or 
                suspension, or declared ineligible by the head of an 
                executive agency on the basis of a determination of a 
                false certification under subparagraph (A).
                    ``(C) Rule of construction.--This subsection shall 
                not be construed to limit the use of other remedies 
                available to the head of an executive agency or any 
                other official of the Federal Government on the basis 
                of a determination of a false certification under 
                paragraph (1).
            ``(3) Implementation through the federal acquisition 
        regulation.--Not later than 120 days after the date of the 
        enactment of the Iran Refined Petroleum Sanctions Act of 2009, 
        the Federal Acquisition Regulation issued pursuant to section 
        25 of the Office of Federal Procurement Policy Act (41 U.S.C. 
        421) shall be revised to provide for the implementation of the 
        requirements of this subsection.''.
    (c) Additional Mandatory Sanctions Relating to Transfer of Nuclear 
Technology.--Section 5(b) of the Iran Sanctions Act of 1996 is 
amended--
            (1) by redesignating paragraphs (1) and (2) as 
        subparagraphs (A) and (B), respectively, and moving such 
        paragraphs 2 ems to the right;
            (2) by striking ``The President shall impose'' and 
        inserting the following:
            ``(1) In general.--The President shall impose'';
            (3) by striking ``section 6'' and inserting ``section 
        6(a)''; and
            (4) by adding at the end the following:
            ``(2) Additional sanction.--
                    ``(A) Restriction.--In any case in which a person 
                is subject to sanctions under paragraph (1) because of 
                an activity described in such paragraph that relates to 
                the acquisition or development of nuclear weapons or 
                related technology or of missiles or other advanced 
                conventional weapons that are capable of delivering a 
                nuclear weapon, then notwithstanding any other 
                provision of law, the following measures shall apply 
                with respect to the country that has jurisdiction over 
                such person, unless the President determines and 
                notifies the appropriate congressional committees that 
                the government of such country has taken, or is taking, 
                effective actions to penalize such person and to 
                prevent a reoccurrence of such activity in the future:
                            ``(i) No agreement for cooperation between 
                        the United States and the government of such 
                        country may be submitted to the President or to 
                        Congress pursuant to section 123 of the Atomic 
                        Energy Act of 1954 (42 U.S.C. 2153), or may 
                        enter into force.
                            ``(ii) No license may be issued for the 
                        export, and no approval may be given for the 
                        transfer or retransfer, directly or indirectly, 
                        to such country of any nuclear material, 
                        facilities, components, or other goods, 
                        services, or technology that would be subject 
                        to an agreement to cooperation.
                    ``(B) Construction.--The restrictions in 
                subparagraph (A) shall apply in addition to all other 
                applicable procedures, requirements, and restrictions 
                contained in the Atomic Energy Act of 1954 and other 
                laws.
                    ``(C) Definition.--In this paragraph, the term 
                `agreement for cooperation' has the meaning given that 
                term in section 11 b. of the Atomic Energy Act of 1954 
                (42 U.S.C. 2014(b)).''.
    (d) Strengthening of Waiver Authority and Sanctions 
Implementation.--
            (1) Investigations.--Section 4(f) of the Iran Sanctions Act 
        of 1996 (50 U.S.C. 1701 note) is amended--
                    (A) in paragraph (1)--
                            (i) by striking ``should initiate'' and 
                        inserting ``shall immediately initiate'';
                            (ii) by inserting ``or 5(b)'' after 
                        ``section 5(a)''; and
                            (iii) by striking ``as described in such 
                        section'' and inserting ``as described in 
                        section 5(a)(1) or other activity described in 
                        section 5(a)(2) or 5(b) (as the case may be)''; 
                        and
                    (B) in paragraph (2), by striking ``should 
                determine, pursuant to section 5(a), if a person has 
                engaged in investment activity in Iran as described in 
                such section'' and inserting ``shall determine, 
                pursuant to section 5(a) or (b) (as the case may be), 
                if a person has engaged in investment activity in Iran 
                as described in section 5(a)(1) or other activity 
                described in section 5(a)(2) or 5(b) (as the case may 
                be)''.
            (2) General waiver authority.--Section 9(c) of the Iran 
        Sanctions Act of 1996 (50 U.S.C. 1701 note) is amended--
                    (A) in paragraph (1)--
                            (i) by inserting after ``on a person 
                        described in section 5(c),'' the following: 
                        ``or on a country described in section 
                        5(b)(2)(A) (if the President certifies to the 
                        appropriate congressional committees that the 
                        President is unable to make the determination 
                        described in such section 5(b)(2)(A) with 
                        respect to the government of that country),''; 
                        and
                            (ii) by striking ``important to the 
                        national interest of the United States'' and 
                        inserting ``vital to the national security 
                        interest of the United States''; and
                    (B) in paragraph (2)--
                            (i) in subparagraphs (A), (B), and (D), by 
                        striking ``or (b)'' each place it appears and 
                        inserting ``or (b)(1)''; and
                            (ii) by amending subparagraph (C) to read 
                        as follows:
                    ``(C) an estimate of the significance of the 
                provision of the items described in paragraph (1) or 
                (2) of section 5(a) or section 5(b)(1) to Iran's 
                ability to develop its petroleum resources, to maintain 
                or expand its domestic production of refined petroleum 
                products, to import refined petroleum products, or to 
                develop its weapons of mass destruction or other 
                military capabilities (as the case may be); and''.
    (e) Reports on United States Efforts To Curtail Certain Business 
and Other Transactions Relating to Iran.--Section 10 of such Act is 
amended--
            (1) in subsection (a), by amending paragraph (4) to read as 
        follows:
            ``(4) Iran's use in the Middle East, the Western 
        Hemisphere, Africa, and other regions, of Iranian diplomats and 
        representatives of other government and military or quasi-
        governmental institutions or proxies of Iran, including, but 
        not limited to, Hezbollah, to promote acts of international 
        terrorism or to develop or sustain Iran's nuclear, chemical, 
        biological, and missile weapons programs.''; and
            (2) by adding at the end the following:
    ``(d) Reports on Certain Business and Other Transactions Relating 
to Iran.--
            ``(1) In general.--Not later than 90 days after the date of 
        the enactment of the Iran Refined Petroleum Sanctions Act of 
        2009, and every 6 months thereafter, the President shall submit 
        a report to the appropriate congressional committees regarding 
        any person who has--
                    ``(A) provided Iran with refined petroleum 
                products;
                    ``(B) sold, leased, or provided to Iran any goods, 
                services, or technology that would allow Iran to 
                maintain or expand its domestic production of refined 
                petroleum products; or
                    ``(C) engaged in any activity that could contribute 
                to the enhancement of Iran's ability to import refined 
                petroleum products.
            ``(2) Description.--For each activity set forth in 
        subparagraphs (A) through (C) of paragraph (1), the President 
        shall provide a complete and detailed description of such 
        activity, including--
                    ``(A) the date or dates of such activity;
                    ``(B) the name of any persons who participated or 
                invested in or facilitated such activity;
                    ``(C) the United States domiciliary of the persons 
                referred to in subparagraph (B);
                    ``(D) any Federal Government contracts to which the 
                persons referred to in subparagraph (B) are parties; 
                and
                    ``(E) the steps taken by the United States to 
                respond to such activity.
            ``(3) Additional information.--The report required by this 
        subsection shall also include a list of--
                    ``(A) any person that the President determines is 
                an agent, alias, front, instrumentality, 
                representative, official, or affiliate of the Islamic 
                Revolutionary Guard Corps or is an individual serving 
                as a representative of the Islamic Revolutionary Guard 
                Corps;
                    ``(B) any person that the President determines has 
                knowingly provided material support to the Islamic 
                Revolutionary Guard Corps or an agent, alias, front, 
                instrumentality, representative, official, or affiliate 
                of the Islamic Revolutionary Guard Corps; and
                    ``(C) any person who has conducted any commercial 
                transaction or financial transaction with the Islamic 
                Revolutionary Guards Corps or an agent, alias, front, 
                instrumentality, representative, official, or affiliate 
                of the Islamic Revolutionary Guard Corps.
            ``(4) Form of reports; publication.--The reports required 
        under this subsection shall be--
                    ``(A) submitted in unclassified form, but may 
                contain a classified annex; and
                    ``(B) published in the Federal Register.
    ``(e) Reports on Global Trade Relating to Iran.--Not later than one 
year after the date of the enactment of the Iran Refined Petroleum 
Sanctions Act of 2009 and annually thereafter, the President shall 
submit to the appropriate congressional committees a report, with 
respect to the immediately preceding 12-month period, on the dollar 
value amount of trade, including in the energy sector, between Iran and 
each country maintaining membership in the Group of Twenty Finance 
Ministers and Central Bank Governors.''.
    (f) Clarification and Expansion of Definitions.--Section 14 of such 
Act is amended--
            (1) in paragraph (13)(B)--
                    (A) by inserting ``financial institution, insurer, 
                underwriter, guarantor, any other business 
                organization, including any foreign subsidiary, parent, 
                or affiliate of such a business organization,'' after 
                ``trust,''; and
                    (B) by inserting ``, such as an export credit 
                agency'' before the semicolon at the end;
            (2) by redesignating paragraphs (15) and (16) as paragraphs 
        (17) and (18), respectively; and
            (3) by striking paragraph (14) and inserting the following:
            ``(14) Knowingly.--The term `knowingly' means--
                    ``(A) having actual knowledge; or
                    ``(B) having the constructive knowledge deemed to 
                be possessed by a reasonable individual who acts under 
                similar circumstances.
            ``(15) Petroleum resources.--The term `petroleum resources' 
        includes petroleum, oil or liquefied natural gas, oil or 
        liquefied natural gas tankers, and products used to construct 
        or maintain pipelines used to transport oil or compressed or 
        liquefied natural gas.
            ``(16) Refined petroleum products.--The term `refined 
        petroleum products' means gasoline, kerosene, diesel fuel, 
        residual fuel oil, and distillates and other goods classified 
        in headings 2709 and 2710 of the Harmonized Tariff Schedule of 
        the United States.''.
    (g) Termination of Certain Provisions.--Section 8 of the Iran 
Sanctions Act of 1996 is amended--
            (1) by striking ``The requirement under section 5(a)'' and 
        inserting ``(a) Sanctions Relating to Investment.--The 
        requirement under section 5(a)(1)(A)'';
            (2) by striking ``with respect to Iran''; and
            (3) by adding at the end the following:
    ``(b) Refined Petroleum Products.--The requirements under 
paragraphs (1)(B) and (2) of section 5(a) and section 6(b) to impose 
sanctions shall no longer have force or effect if the President 
determines and certifies to the appropriate congressional committees 
that Iran--
            ``(1) has ceased its efforts to design, develop, 
        manufacture, or acquire a nuclear explosive device or related 
        materials and technology; and
            ``(2) has ceased nuclear-related activities, including 
        uranium enrichment, that would facilitate the efforts described 
        in paragraph (1).''.
    (h) Extension of Act.--Section 13(b) of the Iran Sanctions Act of 
1996 is amended by striking ``2011'' and inserting ``2016''.
    (i) Technical Amendments.--
            (1) Multilateral regime.--Section 4 of such Act is 
        amended--
                    (A) in subsection (b)(2), by striking ``(in 
                addition to that provided in subsection (d))''; and
                    (B) by striking subsection (d) and redesignating 
                subsections (e) and (f) as subsections (d) and (e), 
                respectively.
            (2) Reference to committee on foreign affairs.--Section 
        14(2) of such Act is amended by striking ``International 
        Relations'' and inserting ``Foreign Affairs''.
            (3) Conforming amendments.--(A) Section 5(c)(1) of such Act 
        is amended by striking ``or (b)'' and inserting ``or (b)(1)''.
            (B) Section 9(a) of such Act is amended by striking ``or 
        5(b)'' each place it appears and inserting ``or 5(b)(1)''.

SEC. 4. EFFECTIVE DATE; RULE OF CONSTRUCTION.

    (a) In General.--The amendments made by this Act shall take effect 
upon the expiration of the 60-day period beginning on the date of the 
enactment of this Act, except that--
            (1) paragraphs (1) and (2) of section 5(a), section 
        5(b)(2), and section 6(b), of the Iran Sanctions Act of 1996, 
        as amended by this Act, shall apply to conduct engaged in on or 
        after October 28, 2009, notwithstanding section 5(f)(3) of the 
        Iran Sanctions Act of 1996; and
            (2) the amendments made by subsection (d) of section 3 of 
        this Act shall apply with respect to conduct engaged in before, 
        on, or after the date of the enactment of this Act.
    (b) Rule of Construction.--
            (1) Existing sanctions not affected.--The amendments made 
        by subsections (a) and (b) of section 3 of this Act shall not 
        be construed to affect the requirements of section 5(a) of the 
        Iran Sanctions Act of 1996 as in effect before the date of the 
        enactment of this Act, and such requirements continue to apply, 
        on and after such date of enactment, to conduct engaged in 
        before October 28, 2009.
            (2) Waiver authority.--The amendments made by subsection 
        (d) of section 3 of this Act shall not be construed to affect 
        any exercise of the authority under section 4(f) or section 
        9(c) of the Iran Sanctions Act of 1996 as in effect on the day 
        before the date of the enactment of this Act.

                          Summary and Purpose

    H.R. 2194, the Iran Refined Petroleum Sanctions Act of 2009 
(IRPSA), amends the Iran Sanctions Act of 1996 to provide 
additional sanctions specifically related to Iran's production 
of refined petroleum products and the export to Iran of such 
products, among other measures. The purpose of the legislation 
is to pressure the Government of Iran to verifiably suspend, 
and ultimately dismantle its weapons-applicable nuclear 
program, including, but not exclusive to, the ceasing of all 
uranium enrichment activities through the application of 
targeted sanctions. The sanctions will terminate once the 
President determines that Iran has ceased its efforts to 
design, develop, manufacture or acquire a nuclear explosive 
device or related materials and technology, and has ceased 
nuclear-related activities, including uranium enrichment, that 
would facilitate such efforts.

                Background and Need for the Legislation

    Iran poses a significant threat to the United States and 
our allies in the Middle East and elsewhere. Preventing Iran 
from acquiring weapons of mass destruction, in particular 
nuclear weapons, and ending its support for international 
terrorism are vital U.S. national security interests. This 
legislation is aimed at restricting economic activity that 
relies on refined petroleum products in Iran, thereby 
pressuring the Iranian regime to cease its nuclear program.
    Iran's economy, and Iran's ability to influence events, is 
heavily dependent on the revenue derived from energy exports. 
Accordingly, most recent U.S. efforts to prevent Iran from 
acquiring nuclear weapons have sought to deter foreign 
investment in Iran's petroleum sector, thereby limiting Iran's 
energy sector profits. Legislatively, this goal was first 
embodied in the Iran and Libya Sanctions Act of 1996, P.L. 104-
172 (``ILSA,'' now referred to as the Iran Sanctions Act, or 
``ISA''), which was passed in 1996 for a five-year period and 
has been renewed twice, in 2001 and 2006, for additional five-
year periods. Although ISA was enacted more than a decade ago, 
no Administration has sanctioned a foreign entity for investing 
$20 million or more in Iran's energy sector, as specified in 
the legislation, despite several such investments. Indeed, on 
only one occasion, in 1998, the Administration made a 
determination regarding a sanctions-triggering investment, but 
the Administration waived sanctions against the offending 
persons. The Committee believes that because of the lack of 
enforcement of relevant enacted sanctions, measures to date 
have not prevented or constrained Iran's efforts to pursue 
nuclear weapons.
    Despite the Executive Branch's failure to fully implement 
the ISA, the legislation has made a positive contribution to 
United States national security. Arguably, the supply of 
capital to the Iranian petroleum sector has been constrained by 
the threat of sanctions. Further, by highlighting the threat 
from Iran, ISA has emerged as a deterrent to additional 
investment. For these reasons, in 2006 Congress extended ISA 
for five years.
    Notwithstanding the additional costs imposed on Iran as a 
result of these sanctions and other measures, such as sanctions 
imposed by the United Nations Security Council, Iran's 
development of its nuclear program continues. Iran most likely 
did not possess a capacity to enrich uranium at the time the 
ISA became law in 1996, but the International Atomic Energy 
Agency (IAEA) now estimates that, in the interim, Iran has 
produced and stockpiled sufficient low-enriched uranium for one 
nuclear explosive device.
    For these reasons, the Committee judged that additional and 
tougher sanctions are needed in order to persuade Iran to cease 
its nuclear program. IRPSA is an amendment to the ISA. Its 
fundamental purpose is to deny Iran the ability to acquire or 
produce nuclear weapons. The Committee seeks to achieve that 
goal through limiting the amount of refined petroleum that Iran 
is able to acquire or produce--especially gasoline for 
automobiles. Refined petroleum is seen as a critical 
vulnerability of the Iranian economy. Despite its position as 
one of the world's leading oil producers, it is estimated that 
Iran imports between 25 percent and 40 percent of its refined 
oil needs, due to its limited domestic refining capacity. 
Accordingly, IRPSA mandates sanctions on a foreign person who 
(1) knowingly facilitates Iran's domestic production of refined 
petroleum products, or (2) knowingly provides Iran with refined 
petroleum products or contributes to Iran's ability to import 
refined petroleum resources. Such persons would, in effect, be 
barred from doing business with the United States.
    H.R. 2194 strengthens the ISA in the following ways:
    (1) It closes existing loopholes regarding investigations 
of sanctionable activities and subsequent determinations. It 
requires the President to investigate a person upon receipt of 
credible information that such person is engaged in 
sanctionable activity and to make a determination within 180 
days of commencing such an investigation. Currently, the 
President is not required to commence or conclude an 
investigation, or even to make a determination regarding 
sanctionable activities.
    (2) It mandates a new category of sanctions against persons 
engaged in assisting Iran's production of refined petroleum 
products and in exporting such products to Iran, not just 
persons who make investments that enhance Iran's ability to 
develop petroleum resources.
    IRPSA is the most recent legislative effort to tighten 
sanctions on foreign companies doing significant business with 
Iran for the purpose, in whole or in part, of bringing Iran's 
nuclear program to a complete, verifiable, and irreversible 
halt.
    U.S. individuals and companies have been prohibited from 
investing in Iran's petroleum sector since Executive Order 
12957 was issued on March 15, 1995, by President William J. 
Clinton as a follow-on to his Administration's assessment that 
``the actions and policies of the Government of Iran constitute 
an unusual and extraordinary threat to the national security, 
foreign policy, and economy of the United States.'' The White 
House spokesman at that time, Michael McCurry, made clear that 
the objectionable activities were Iran's pursuit of weapons of 
mass destruction, its support of international terrorism, and 
its efforts to undermine the Middle East peace process. 
Responding to the same concerns, a subsequent executive order, 
E.O. 12959, issued on May 8, 1995, banned all ``new 
investment'' in Iran by U.S. individuals and companies. The 
same executive order banned virtually all trade with Iran. In 
conjunction with the latter executive order, then-Secretary of 
State Warren Christopher warned the international community 
that the path Iran was following was a mirror image of the 
steps taken by other nations that had sought nuclear weapons 
capabilities. With the U.S. having voluntarily removed itself 
from the Iran market, Congress passed ILSA in 1996 to encourage 
foreign persons to withdraw from the Iranian market. On August 
3, 2001, President George W. Bush signed into law the ``ILSA 
Extension Act of 2001'' (P.L. 107-24).
    In September 2006, to further strengthen sanctions 
targeting foreign investment in Iran's energy sector, Congress 
passed the ``Iran Freedom Support Act'' (IFSA), a bill 
subsequently signed into law (P.L. 109-293) by President George 
W. Bush. Among other provisions, the IFSA strengthened 
sanctions under ISA, including by raising certain waiver 
thresholds to `vital to the national security interests of the 
United States,' by enlarging the scope of those who might be 
subject to sanctions, and by enhancing tools for using 
financial means to address Iran's activities of concern. 
Another such effort was H.R.1400, the ``Iran Counter-
Proliferation Act of 2007,'' which passed the House in 
September 2007, but did not become law. A key provision of that 
bill eliminated the President's ability to waive sanctions 
under ISA. A modified version of that legislation, H.R. 7112, 
the ``Comprehensive Iran Sanctions, Accountability, and 
Divestment Act of 2008,'' which did not include the waiver-
removal provision, passed the House in September 2008, but did 
not become law.
    The Committee believes that the imminence and seriousness 
of the threat posed to U.S. interests by Iran's nuclear weapons 
program warrants the enactment of H.R. 2194. The Committee 
further believes that the sanctions contained in IRPSA are 
necessary and proportional, as they are exclusively tied to 
Iran's nuclear program. The Act specifically provides that the 
additional sanctions shall terminate once the President 
certifies that Iran has ceased its efforts to design, develop, 
manufacture, or acquire a nuclear explosive device or related 
materials and technology; and has ceased nuclear-related 
activities that would facilitate such efforts. By strengthening 
the underlying Act, the Committee recognizes the totality of 
the threat that Iran poses to the United States, Israel, and 
other U.S. allies.
    The Committee urges friends and allies of the United States 
to adopt similar measures and follow the U.S. lead in cutting 
off virtually all economic relations with Iran until that 
country terminates its nuclear program. In the 1990s, many U.S. 
friends and allies who objected to ILSA asserted that Iran's 
nuclear efforts were exclusively focused on the peaceful use of 
nuclear energy. Clearly, that is no longer the case. In this 
decade, revelations of secret Iranian nuclear-related 
facilities, as well as Iran's lack of cooperation with the IAEA 
and its refusal to comply with repeated UN Security Council 
demands that it suspend its uranium enrichment activities, have 
altered the Western world's attitude toward the Iranian nuclear 
issue. Few, if any, objective observers now dispute that Iran's 
nuclear program is military-related and represents a threat to 
global stability. All concur that Iran is pursuing its nuclear 
program in defiance of the demands of the international 
community. The Committee believes it is time for responsible 
nations to cease investing in Iran's energy industry in order 
to undermine its ability to finance its nuclear weapons.

                                Hearings

    The Committee held two hearings directly related to the 
subject matter of the bill. A Full committee hearing took place 
on July 22, 2009, entitled, ``Iran: Recent Developments and 
Implications for U.S. Policy,'' which explored Iran's ongoing 
nuclear program and U.S. efforts to contain that program. 
Witnesses included Patrick Clawson, Ph.D., Deputy Director for 
Research, the Washington Institute for Near East Policy; 
Suzanne Maloney, Ph.D., Senior Fellow, the Brookings 
Institution; Abbas Milani, Ph.D., Co-Director, Iran Democracy 
Project, Hoover Institution, Director, Iranian Studies, 
Stanford University; Ms. Karim Sadjadpour, Associate, Middle 
East Program, Carnegie Endowment for International Peace; 
Michael Rubin, Ph.D., Resident Scholar, the American Enterprise 
Institute; and Orde F. Kittrie, J.D., Professor of Law, Arizona 
State University.
    The Subcommittee on Middle East and South Asia, in 
conjunction with the Subcommittees on Western Hemisphere 
Affairs and Terrorism, Nonproliferation, and Trade, held a 
hearing entitled ``Iran in the Western Hemisphere,'' which took 
place on October 27, 2009. Witnesses included Mr. Eric 
Farnsworth, Vice President, Council of the Americas; Ms. Dina 
Siegel Vann, Director, Latino and Latin American Institute, 
American Jewish Committee; Mr. Douglas Farah, Senior Fellow, 
Financial Investigations and Transparency, International 
Assessment and Strategy Center; Mohsen M. Milani, Ph.D., 
Department of Government & International Affairs, University of 
South Florida; and Norman A. Bailey, Ph.D., Consulting 
Economist, the Potomac Foundation.

                        Committee Consideration

    On October 28, 2009, the Committee marked up H.R. 2194 and 
reported it favorably to the House, as amended, by a voice 
vote, with a quorum present.

                         Votes of the Committee

    There were no recorded votes during consideration of H.R. 
2194.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII of the Rules 
of the House of Representatives, the Committee reports that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

               New Budget Authority and Tax Expenditures

    In compliance with Clause 3(c)(2) of House Rule XIII, the 
Committee adopts as its own the estimate of new budget 
authority, entitlement authority, or tax expenditures or 
revenues contained in the cost estimate prepared by the 
Director of the Congressional Budget Office, pursuant to 
section 308(a) of the Congressional Budget Act of 1974.

               Congressional Budget Office Cost Estimate

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, the Committee sets forth, with 
respect to the bill, H.R. 2194, the following estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, November 18, 2009.
Hon. Howard L. Berman, Chairman,
Committee on Foreign Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2194, the Iran 
Refined Petroleum Sanctions Act of 2009.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is John Chin, 
who can be reached at 226-2840.
            Sincerely,
                                       Douglas W. Elmendorf
Enclosure

cc:
        Honorable Ileana Ros-Lehtinen
        Ranking Member
H.R. 2194--Iran Refined Petroleum Sanctions Act of 2009
    H.R. 2194 would amend the Iran Sanctions Act of 1996 in 
several ways. The bill would:

         LRequire the President to immediately 
        investigate a person once the United States receives 
        credible information that they have supplied refined 
        petroleum products to Iran or supported the domestic 
        production of such products in Iran, and to determine 
        within 180 days whether that person has in fact engaged 
        in such sanctionable activity in Iran,
         LProhibit any foreign exchange, banking, and 
        property transaction with persons engaged in 
        sanctionable activity in Iran unless the President 
        determines it is vital to the national security 
        interest of the United States, and
         LExtend the act's sunset date from December 
        31, 2011, to December 31, 2016.

    Enacting the bill would not affect direct spending or 
revenues. However, the bill would increase spending subject to 
appropriation to cover the costs of employing additional staff 
to gather and analyze information, provide advisory opinions, 
write reports, and administer blocked property. Based on 
information provided by the Department of State, CBO estimates 
that those costs would be about $2 million a year.
    H.R. 2194 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would impose no 
costs on state, local, or tribal governments.
    By extending and expanding sanctions under the Iran 
Sanctions Act, the bill could impose private-sector mandates as 
defined in UMRA on entities in the United States that engage in 
transactions with businesses or countries sanctioned under that 
act. The bill would require the President to impose certain 
sanctions on entities that invest more than a specified amount 
of money in businesses involved in Iran's petroleum industry. 
The bill also would require the President to sanction any 
entity that provides Iran with refined petroleum resources, or 
engages in an activity that could contribute to Iran's ability 
to import such resources. Efforts to expand or improve Iran's 
oil production or refinery capacity, any related shipments, and 
any technical or material support for its nuclear weapons or 
missile programs would also be sanctionable activities. 
Entities sanctioned for those actions would effectively be 
prohibited from engaging in business with persons in the United 
States.
    Entities in the United States involved in transactions with 
entities sanctioned under the bill also would be required to 
cease those transactions. For example, vessel chartering 
companies as well as financial institutions engaged in 
transactions related to trade with sanctioned entities could be 
affected. The cost of the mandate would be the forgone net 
income from the prohibited transactions, and would depend on 
the specific sanctions applied by the President in the future. 
CBO has no basis for predicting when the President might impose 
such sanctions and thus cannot determine whether the aggregate 
cost of mandates would exceed the annual threshold established 
in UMRA for private-sector mandates ($139 million in 2009, 
adjusted annually for inflation).
    On November 17, 2009, CBO transmitted a cost estimate for 
the Comprehensive Iran Sanctions, Accountability, and 
Divestment Act of 2009 as ordered reported by the Senate 
Committee on Banking, Housing, and Urban Affairs on October 29, 
2009. Section 102 of that act is similar to H.R. 2194, but 
would not extend the sunset date of the Iran Sanctions Act of 
1996 beyond December 31, 2011. Thus, CBO estimated that it 
would cost about $5 million to implement the previous 
legislative language over the 2010-2014 period, whereas CBO 
estimates that it would cost about $10 million to implement 
H.R. 2194 over those five years.
    The CBO staff contacts for this estimate are John Chin for 
federal budget impacts and Marin Randall for impacts on the 
private sector. This estimate was approved by Theresa Gullo, 
Deputy Assistant Director for Budget Analysis.

                    Performance Goals and Objectives

    The Act is intended to deprive Iran of the funds it needs 
to pursue its nuclear program, including its efforts to acquire 
or develop and produce nuclear weapons.

                   Constitutional Authority Statement

    Pursuant to clause 3(d) (1) of rule XIII of the Rules of 
the House of Representatives, the Committee finds the authority 
for this legislation in article I, section 8 of the 
Constitution.

                        New Advisory Committees

    H.R. 2194 does not establish or authorize any new advisory 
committees.

                    Congressional Accountability Act

    H.R. 2194 does not apply to the Legislative Branch.

                         Earmark Identification

    H.R. 2194 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9(e), 9(f), or 9(g) of rule XXI.

               Section-by-Section Analysis and Discussion

Section 1. Short Title.
    This section provides that the short title of the Act is 
the ``Iran Refined Petroleum Sanctions Act of 2009.''
Section 2. Findings; Sense of Congress; Statement of Policy.
    This section articulates the findings, Sense of Congress; 
and Statement of Policy that frame the basis for the additional 
sanctions and the purpose of the bill.
    Subsection (a) finds that Iran's illicit nuclear 
activities--combined with its development of unconventional 
weapons and ballistic missiles, and support for international 
terrorism--represent a serious threat to the security of the 
United States and U.S. allies in Europe, the Middle East, and 
around the world.
    Subsection (a) also finds: that the United States and other 
responsible nations have a vital interest in working together 
to prevent Iran from acquiring a nuclear weapons capability; 
that the International Atomic Energy Agency has repeatedly 
called attention to Iran's unlawful nuclear activities, and, as 
a result, the United Nations Security Council has adopted a 
range of sanctions designed to encourage Iran to suspend those 
activities and comply with its obligations under the Treaty on 
the Non-Proliferation of Nuclear Weapons (commonly known as the 
``Nuclear Non-Proliferation Treaty,'' or ``NPT''); that, as a 
Presidential candidate in 2008, then-Senator Barack Obama 
stated that additional sanctions, especially those targeting 
Iran's dependence on imported refined petroleum, may help to 
persuade the Government of Iran to abandon its illicit nuclear 
activities; that, on October 7, 2008, then-Senator Obama stated 
that ``Iran right now imports gasoline, even though it's an oil 
producer, because its oil infrastructure has broken down. If we 
can prevent them from importing the gasoline that they need and 
the refined petroleum products, that starts changing their 
cost-benefit analysis. That starts putting the squeeze on 
them.''; that, on June 4, 2008, then-Senator Obama stated, ``We 
should work with Europe, Japan, and the Gulf states to find 
every avenue outside the U.N. to isolate the Iranian regime--
from cutting off loan guarantees and expanding financial 
sanctions, to banning the export of refined petroleum to 
Iran.''; that major European allies, including the United 
Kingdom, France, and Germany, have advocated that sanctions be 
significantly toughened should international diplomatic efforts 
fail to achieve verifiable suspension of Iran's uranium 
enrichment program and an end to its nuclear weapons program 
and other illicit nuclear activities; that the serious and 
urgent nature of the threat from Iran demands that the United 
States work together with U.S. allies to do everything 
possible--diplomatically, politically, and economically--to 
prevent Iran from acquiring a nuclear weapons capability; and 
that the human rights situation in Iran has steadily 
deteriorated in 2009, as punctuated by the transparent fraud 
that occurred in the June 12 elections, the brutal repression 
and murder, arbitrary arrests, and show trials of dissidents, 
and ongoing suppression of freedom of expression.
    Subsection (b) expresses the Sense of Congress that 
international diplomatic efforts to address Iran's illicit 
nuclear efforts, unconventional and ballistic missile 
development programs, and support for international terrorism 
are more likely to be effective if the President is empowered 
with the explicit authority to impose additional sanctions on 
the Government of Iran.
    Subsection (b) also expresses the Sense of Congress: that 
the concerns of the United States regarding Iran are strictly 
the result of the actions of the Government of Iran; that the 
revelation in September 2009 that Iran is developing a secret 
uranium enrichment site on an Islamic Revolutionary Guard Corps 
base near Qom, which appears to have no civilian application, 
highlights the urgency for Iran to fully disclose the nature of 
its nuclear program, including any other secret locations, and 
provide the International Atomic Energy Agency (IAEA) 
unfettered access to its facilities pursuant to Iran's legal 
obligations under the NPT and Iran's Safeguards Agreement with 
the IAEA; that, because of its involvement in Iran's nuclear 
program and other destabilizing activities, the President 
should impose sanctions, including the full range of sanctions 
otherwise applicable to Iran, on any individual or entity that 
is an agent, alias, front, instrumentality, representative, 
official, or affiliate of the Islamic Revolutionary Guard Corps 
or is an individual serving as a representative of the Islamic 
Revolutionary Guard Corps, or on any person that has conducted 
any commercial transaction or financial transaction with such 
entities; that government-to-government agreements with Iran to 
provide the regime with refined petroleum products, such as the 
September 2009 agreement under which the Government of 
Venezuela committed to provide 20,000 barrels of gasoline per 
day to Iran, undermine efforts to pressure Iran to suspend its 
nuclear weapons program and cease all enrichment activities; 
and that the people of the United States have feelings of 
friendship for the people of Iran and hold the people of Iran, 
their culture, and their ancient and rich history in the 
highest esteem.
    Subsection (c) asserts that it shall be the policy of the 
United States to prevent Iran from achieving the capability to 
make nuclear weapons, including by supporting international 
diplomatic efforts to halt Iran's uranium enrichment program.
    Subsection (c) likewise asserts the following as United 
States policies: to fully implement and enforce the Iran 
Sanctions Act of 1996 as a means of encouraging foreign 
governments to direct state-owned entities to cease all 
investment in, and support of, Iran's energy sector and all 
exports of refined petroleum products to Iran; to fully 
implement and enforce the Iran Sanctions Act of 1996 as a means 
of encouraging foreign governments to require private entities 
based in their territories to cease all investment in, and 
support of, Iran's energy sector and all exports of refined 
petroleum products to Iran; to impose sanctions, including 
through the use of Executive Orders 13224, 13382, and 13438 and 
United Nations Security Council Resolutions 1737, 1747, 1803, 
and 1835, on the Central Bank of Iran and any other Iranian 
financial institution engaged in proliferation activities or 
support of terrorist groups; to impose sanctions, including 
through the use of Executive Orders 13224, 13382, and 13438 and 
United Nations Security Council Resolutions 1737, 1747, 1803, 
and 1835, on any financial institution that conducts financial 
transactions with the Central Bank of Iran or with another 
Iranian financial institution engaged in proliferation 
activities or support of terrorist groups; to persuade U.S. 
allies and other countries to take appropriate measures to deny 
access to the international financial system by Iranian banks 
and financial institutions involved in proliferation activities 
or support of terrorist groups; to support all Iranian citizens 
who embrace the values of freedom, human rights, civil 
liberties, and rule of law; and for the Secretary of State to 
make every effort to assist United States citizens held hostage 
in Iran at any time during the period beginning on November 4, 
1979, and ending on January 20, 1981, and their survivors in 
matters of compensation related to such citizens' detention.
Section 3. Amendments to the Iran Sanctions Act of 1996.
    Subsection (a) amends section 5(a) of the Iran Sanctions 
Act of 1996 to restate the requirement that the President shall 
impose two or more current sanctions under the Iran Sanctions 
Act of 1996 if a person has knowingly made an investment of $20 
million or more (or any combination of investments of at least 
$5 million each, which in the aggregate equals or exceeds $20 
million in any 12-month period) that directly and significantly 
contributed to Iran's ability to develop its petroleum 
resources. In the context of investment, H.R. 2194 amends 
section 5(a) in two key ways: (1) H.R. 2194 shifts the mens rea 
standard for investment in petroleum resources from `actual 
knowledge' to ``knowingly,'' which includes actual knowledge 
and having the constructive knowledge deemed to be possessed by 
a reasonable individual who acts under similar circumstances. 
In short, the new standard will expand the range of conduct 
potentially subject to sanctions, thereby making it easier 
implement sanctions under ISA; and (2) The Act also amends the 
definition of petroleum resources to include items such as 
liquefied natural gas, oil, or liquefied natural gas tankers, 
the effect of which is to broaden sanctionable investments 
under ISA.
    Subsection (a) further amends section 5(a) of ISA to 
require that the President impose mandatory sanctions described 
in section 3(b) of the Act if a person: (1) knowingly sells, 
leases, or provides to Iran any goods, services, technology, 
information, or support, or enters into a contract for those 
activities, that would allow Iran to maintain or expand its 
domestic production of refined petroleum products, including 
any assistance in the construction, modernization, or repair of 
refineries that make refined petroleum products; or (2) if a 
person knowingly provides Iran with refined petroleum products 
or engages in an activity that could contribute to Iran's 
ability to import refined petroleum resources by providing 
ships, vehicles, or other means of transportation to deliver 
refined petroleum products to Iran or insurance or financing 
services for such activities.
    The Act further establishes that the value of the goods, 
services, technology, information, or support provided by such 
activities must exceed $200,000 to be subject to the 
requirement of Section 3(a). The combination of such sales, 
leases, or provision of support in any 12-month period, or to 
be provided under contracts entered into in any 12-month 
period, must exceed $500,000.
    Subsection (b) of the Act describes the sanctions and 
establishes additional sanctions to Section 6 of ISA by 
directing the President to prohibit foreign exchange, banking, 
and property transactions with persons involved in activities 
related to refined petroleum products, as specified in 
paragraphs (1)(B) and (2) of section 5(a) of ISA, as amended.
    Subsection 3(b) further amends ISA by adding a new section 
which requires the head of each executive agency to ensure that 
each contract with a person entered into by such executive 
agency for the procurement of goods or services, or agreement 
for the use of Federal funds as part of a grant, loan, or loan 
guarantee to a person, includes a clause that requires the 
person to certify to the contracting officer or other 
appropriate official of such agency that the person does not 
conduct any activity described in paragraph (1)(B) or (2) of 
section 5(a) relating to the production or export of refined 
petroleum products. The Act authorizes the head of an executive 
agency that determines that a person has submitted a false 
certification under paragraph (1) after the date on which the 
Federal Acquisition Regulation is revised to implement the 
requirements of this subsection, to terminate a contract or 
agreement or debar or suspend such person from eligibility for 
Federal contracts or such agreements for a period not to exceed 
15 years. The Act requires the Administrator of General 
Services to include on the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs each person 
that is debarred, suspended, proposed for debarment or 
suspension, or declared ineligible by the head of an executive 
agency on the basis of a determination of a false certification 
under subparagraph (A) of section 3(c).
    Subsection (c) amends section 5(b) of ISA to restrict 
agreements for nuclear cooperation if a country that has 
jurisdiction over a person that is subject to sanctions under 
paragraph (1) of section 5(b) of ISA relating to the 
acquisition or development of nuclear weapons or related 
technologies or of missiles or other advanced conventional 
weapons that are capable of delivering a nuclear weapon fails 
to take effective actions to penalize such person and prevent a 
reoccurrence of such activity in the future. The Committee 
believes that a country that is, as a matter of policy or 
through willful inaction, allowing its citizens or companies to 
provide equipment, technology or materials to Iran that make a 
material contribution to its nuclear capabilities should not at 
the same time benefit from nuclear cooperation with the United 
States.
    Subsection (d)(1) requires that the President immediately 
investigate a person upon receipt of credible information that 
such person is engaged in sanctionable activity as described in 
section 5. Subsection (d)(1) further requires the President, 
not later than 180 days after an investigation is initiated, to 
make a determination whether a person has engaged in 
sanctionable activity described in section 5.
    Subsection (d)(2) of the Act amends section 9(c)(1) of ISA 
to authorize the President to waive the restriction on nuclear 
agreements on a person or on a country described in section 
5(b)(2)(A) if the President is unable to make the determination 
that the country is taking the effective actions described in 
section 5(b)(2)(A). Such actions may include prosecution of 
persons or companies, suspension of export privileges, 
financial measures, etc., that will effectively prevent a 
reoccurrence of the activities subject to sanction.
    Subsection (d)(2) amends the standard for the President to 
waive sanctions under ISA to ``vital to the national security 
interest of the United States'' as the standard for a 
Presidential waiver of sanctions. Section (d)(2) further amends 
ISA by authorizing the President to waive the restriction 
relating to transfer of nuclear technology if the President is 
unable to make the determination described in section 
5(b)(2)(A) of ISA.
    Subsection (d)(2) further amends the reporting requirements 
of section 3(c)(2) of ISA relating to a waiver by requiring the 
President to include an estimate of the significance of a 
sanctioned action to Iran's ability to develop its petroleum 
resources and other activities should the President waive the 
required sanctions.
    Subsection (e) amends ISA to require additional reporting 
on Iran's use in the Middle East, the Western Hemisphere, 
Africa, and other regions, of Iranian diplomats and 
representatives of other government and military or quasi-
governmental institutions or proxies of Iran, including, but 
not limited to, Hezbollah, to promote acts of international 
terrorism or to develop or sustain Iran's nuclear, chemical, 
biological and missile weapons programs.
    Section (e) also directs the President to report to the 
appropriate congressional committees within 90 days after the 
date of enactment of this legislation, and every six months 
thereafter, regarding any person who has: (1) provided Iran 
with refined petroleum resources; (2) sold, leased, or provided 
to Iran any goods, services, or technology that would allow 
Iran to maintain or expand its domestic production of refined 
petroleum resources; or (3) engaged in any activity that could 
contribute to the enhancement of Iran's ability to import 
refined petroleum resources. This subsection requires the 
President to include in the report a list of any person that 
the President determines is an agent, alias, front, 
instrumentality, representative, official, or affiliate of the 
Islamic Revolutionary Guard Corps, or is an individual serving 
as a representative of the Islamic Revolutionary Guard Corps, 
or provided material support or conducted any commercial or 
financial transactions with such entities. The Committee does 
not intend for this reporting requirement to in any way 
conflict with or amend existing designations of persons 
pursuant to the International Emergency Economic Powers Act (50 
U.S.C. 1701, etc.).
    Finally, this subsection requires the President to transmit 
a report with respect to the immediately preceding 12-month 
period after enactment of the Act, on the dollar value amount 
of trade, including in the energy sector, between Iran and each 
country maintaining membership in the Group of Twenty Finance 
Ministers and Central Bank Governors.
    Subsection (f) amends ISA to expand the definition of a 
``person'' subject to sanctions to include a financial 
institution, insurer, underwriter, guarantor, any other 
business organization, including any foreign subsidiary, 
parent, or affiliate of such a business organization, any other 
nongovernmental entity, organization, or group, and any 
governmental entity operating as a business enterprise, such as 
an export credit agency.
    Subsection (f) also defines the term ``knowingly'' to 
include a person who has actual knowledge of sanctionable 
activities or has constructive knowledge deemed to be possessed 
by a reasonable individual who acts under similar 
circumstances. The Committee intends to prevent persons from 
evading sanctions by relying on a standard of ``actual 
knowledge.''
    Subsection (f) expands the term ``petroleum resources'' to 
include petroleum, oil or liquefied natural gas, oil or 
liquefied natural gas tankers, and products used to construct 
or maintain pipelines used to transport oil or compressed or 
liquefied natural gas.
    Subsection (f) defines the term ``refined petroleum 
products'' to include gasoline, kerosene, diesel fuel, residual 
fuel oil, and distillates and other goods classified in 
headings 2709 and 2710 of the Harmonized Tariff Schedule of the 
United States.
    Subsection (g) amends Section 8 of the ISA of 1996 to 
provide that sanctions related to refined petroleum products, 
as specified in paragraphs (1)(B) and (2) of section 5(a) and 
section 6(b) shall terminate if the President determines and 
certifies to the appropriate congressional committees that 
Iran: (1) has ceased its efforts to design, develop, 
manufacture, or acquire a nuclear explosive device or related 
materials and technology; and (2) has ceased nuclear-related 
activities, including uranium enrichment, that would facilitate 
the efforts described in paragraph (1).
    Subsection (g) also amends ISA to extend the operative date 
of that legislation from 2011 to 2016.
Section 4. Effective Date; Rule of Construction.
    Subsection (a) provides that the amendments to ISA made by 
the Act shall take effect upon expiration of the 60-day period 
beginning on the date of the enactment of this Act, except that 
paragraphs (1) and (2) of section 5(a), section 5(b)(2), and 
section 6(b), of ISA, as amended by this Act, shall apply to 
conduct engaged in on or after October 28, 2009, 
notwithstanding section 5(f)(3) of ISA. The purpose of this 
exception is to prevent a ``rush to contracting'' subsequent to 
the adoption of the Amendment in the Nature of a Substitute on 
October 28, 2009.
    Subsection (a) further provides that the amendments made by 
subsection (d) of section (3) of the Act related to waiver and 
investigations shall apply with respect to conduct engaged in 
before, on, or after the date of the enactment of this Act.
    Subsection (b) states that the amendments made by 
subsections (a) and (b) of section 3 of this Act shall not be 
construed to affect the requirements of section 5(a) of ISA as 
in effect before the date of the enactment of this Act, and 
such requirements continue to apply, on and after such date of 
enactment, to conduct engaged in before October 28, 2009. The 
purpose of this rule of construction is to confirm that 
existing sanctions still apply notwithstanding amendments made 
by this Act to ISA.
    Subsection (b) further provides that the amendments made by 
subsection (d) of section 3 of this Act shall not be construed 
to affect any exercise of the authority under section 4(f) or 
section 9(c) of ISA related to investigations and waiver 
authority in effect on the day before the date of the enactment 
of this Act.

         Changes in Existing Law Made by the Bill, as Reported

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

                       IRAN SANCTIONS ACT OF 1996

           *       *       *       *       *       *       *
SEC. 4. MULTILATERAL REGIME.

    (a) * * *
    (b) Reports to Congress.--The President shall report to the 
appropriate congressional committees, not later than 1 year 
after the date of the enactment of this Act, and periodically 
thereafter, on the extent that diplomatic efforts described in 
subsection (a) have been successful. Each report shall 
include--
            (1) * * *
            (2) the countries that have not agreed to measures 
        described in paragraph (1), and, with respect to those 
        countries, other measures [(in addition to that 
        provided in subsection (d))] the President recommends 
        that the United States take to further the objectives 
        of section 3 with respect to Iran.

           *       *       *       *       *       *       *

    [(d) Enhanced Sanction.--
            [(1) Sanction.--With respect to nationals of 
        countries except those with respect to which the 
        President has exercised the waiver authority of 
        subsection (c), at any time after the first report is 
        required to be submitted under subsection (b), section 
        5(a) shall be applied by substituting ``$20,000,000'' 
        for ``$40,000,000'' each place it appears, and by 
        substituting ``$5,000,000'' for ``$10,000,000''.
            [(2) Report to congress.--The President shall 
        report to the appropriate congressional committees any 
        country with respect to which paragraph (1) applies.]
    [(e)] (d) Interim Report on Multilateral Sanctions; 
Monitoring.--The President, not later than 90 days after the 
date of the enactment of this Act, shall report to the 
appropriate congressional committees on--
            (1) * * *

           *       *       *       *       *       *       *

    [(f)] (e) Investigations.--
            (1) In general.--The President [should initiate] 
        shall immediately initiate an investigation into the 
        possible imposition of sanctions under section 5(a) or 
        5(b) against a person upon receipt by the United States 
        of credible information indicating that such person is 
        engaged in investment activity in Iran [as described in 
        such section] as described in section 5(a)(1) or other 
        activity described in section 5(a)(2) or 5(b) (as the 
        case may be).
            (2) Determination and notification.--Not later than 
        180 days after an investigation is initiated in 
        accordance with paragraph (1), the President [should 
        determine, pursuant to section 5(a), if a person has 
        engaged in investment activity in Iran as described in 
        such section] shall determine, pursuant to section 5(a) 
        or (b) (as the case may be), if a person has engaged in 
        investment activity in Iran as described in section 
        5(a)(1) or other activity described in section 5(a)(2) 
        or 5(b) (as the case may be) and shall notify the 
        appropriate congressional committees of the basis for 
        any such determination.

SEC. 5. IMPOSITION OF SANCTIONS.

    [(a) Sanctions With Respect to the Development of Petroleum 
Resources of Iran.--Except as provided in subsection (f), the 
President shall impose 2 or more of the sanctions described in 
paragraphs (1) through (6) of section 6 if the President 
determines that a person has, with actual knowledge, on or 
after the date of the enactment of this Act, made an investment 
of $40,000,000 or more (or any combination of investments of at 
least $10,000,000 each, which in the aggregate equals or 
exceeds $40,000,000 in any 12-month period), that directly and 
significantly contributed to the enhancement of Iran's ability 
to develop petroleum resources of Iran.]
    (a) Sanctions With Respect to the Development of Petroleum 
Resources of Iran and Exportation of Refined Petroleum to 
Iran.--
            (1) Development of petroleum resources of iran.--
                    (A) Investment.--Except as provided in 
                subsection (f), the President shall impose 2 or 
                more of the sanctions described in paragraphs 
                (1) through (6) of section 6(a) if the 
                President determines that a person has 
                knowingly, on or after the date of the 
                enactment of this Act, made an investment of 
                $20,000,000 or more (or any combination of 
                investments of at least $5,000,000 each, which 
                in the aggregate equals or exceeds $20,000,000 
                in any 12-month period), that directly and 
                significantly contributed to the enhancement of 
                Iran's ability to develop petroleum resources 
                of Iran.
                    (B) Production of refined petroleum 
                products.--Except as provided in subsection 
                (f), the President shall impose the sanctions 
                described in section 6(b) if the President 
                determines that a person knowingly sells, 
                leases, or provides to Iran any goods, 
                services, technology, information, or support, 
                or enters into a contract to sell, lease, or 
                provide to Iran any goods, services, 
                technology, information, or support, that would 
                allow Iran to maintain or expand its domestic 
                production of refined petroleum products, 
                including any assistance in the construction, 
                modernization, or repair of refineries that 
                make refined petroleum products, if--
                            (i) the value of the goods, 
                        services, technology, information, or 
                        support provided in such sale, lease, 
                        or provision, or to be provided in such 
                        contract, exceeds $200,000; or
                            (ii) the value of the goods, 
                        services, technology, information, or 
                        support provided in any combination of 
                        such sales, leases, or provision in any 
                        12-month period, or to be provided 
                        under contracts entered into in any 12-
                        month period, exceeds $500,000.
            (2) Exportation of refined petroleum products to 
        iran.--
                    (A) In general.--Except as provided in 
                subsection (f), the President shall impose the 
                sanctions described in section 6(b) if the 
                President determines that a person knowingly 
                provides Iran with refined petroleum products 
                or engages in any of the activities described 
                in subparagraph (B), if--
                            (i) the value of such products or 
                        of the goods, services, technology, 
                        information, or support provided or to 
                        be provided in connection with such 
                        activity exceeds $200,000; or
                            (ii) the value of such products, or 
                        of the goods, services, technology, 
                        information, or support, provided or to 
                        be provided in connection with any 
                        combination of providing such products 
                        or such activities, in any 12-month 
                        period exceeds $500,000.
                    (B) Activities described.--The activities 
                referred to in subparagraph (A) are the 
                following:
                            (i) Providing ships, vehicles, or 
                        other means of transportation to 
                        deliver refined petroleum products to 
                        Iran, or providing services relating to 
                        the shipping or other transportation of 
                        refined petroleum products to Iran.
                            (ii) Underwriting or otherwise 
                        providing insurance or reinsurance for 
                        an activity described in clause (i).
                            (iii) Financing or brokering an 
                        activity described in clause (i).
    (b) Mandatory Sanctions With Respect to Development of 
Weapons of Mass Destruction or Other Military Capabilities.--
[The President shall impose]
            (1) In general.--The President shall impose two or 
        more of the sanctions described in paragraphs (1) 
        through (6) of [section 6] section 6(a) if the 
        President determines that a person has, on or after the 
        date of the enactment of this Act, exported, 
        transferred, or otherwise provided to Iran any goods, 
        services, technology, or other items knowing that the 
        provision of such goods, services, technology, or other 
        items would contribute materially to the ability of 
        Iran to--
                    [(1)] (A) acquire or develop chemical, 
                biological, or nuclear weapons or related 
                technologies; or
                    [(2)] (B) acquire or develop destabilizing 
                numbers and types of advanced conventional 
                weapons.
            (2) Additional sanction.--
                    (A) Restriction.--In any case in which a 
                person is subject to sanctions under paragraph 
                (1) because of an activity described in such 
                paragraph that relates to the acquisition or 
                development of nuclear weapons or related 
                technology or of missiles or other advanced 
                conventional weapons that are capable of 
                delivering a nuclear weapon, then 
                notwithstanding any other provision of law, the 
                following measures shall apply with respect to 
                the country that has jurisdiction over such 
                person, unless the President determines and 
                notifies the appropriate congressional 
                committees that the government of such country 
                has taken, or is taking, effective actions to 
                penalize such person and to prevent a 
                reoccurrence of such activity in the future:
                            (i) No agreement for cooperation 
                        between the United States and the 
                        government of such country may be 
                        submitted to the President or to 
                        Congress pursuant to section 123 of the 
                        Atomic Energy Act of 1954 (42 U.S.C. 
                        2153), or may enter into force.
                            (ii) No license may be issued for 
                        the export, and no approval may be 
                        given for the transfer or retransfer, 
                        directly or indirectly, to such country 
                        of any nuclear material, facilities, 
                        components, or other goods, services, 
                        or technology that would be subject to 
                        an agreement to cooperation.
                    (B) Construction.--The restrictions in 
                subparagraph (A) shall apply in addition to all 
                other applicable procedures, requirements, and 
                restrictions contained in the Atomic Energy Act 
                of 1954 and other laws.
                    (C) Definition.--In this paragraph, the 
                term ``agreement for cooperation'' has the 
                meaning given that term in section 11 b. of the 
                Atomic Energy Act of 1954 (42 U.S.C. 2014(b)).
    (c) Persons Against Which the Sanctions Are To Be 
Imposed.--The sanctions described in subsections (a) and (b) 
shall be imposed on--
            (1) any person the President determines has carried 
        out the activities described in subsection (a) [or (b)] 
        or (b)(1); and

           *       *       *       *       *       *       *

SEC. 6. DESCRIPTION OF SANCTIONS.

    [The sanctions to be imposed on a sanctioned person under 
section 5 are as follows:]
    (a) In General.--The sanctions to be imposed on a 
sanctioned person under subsections (a)(1)(A) and (b)(1) of 
section 5 are as follows:
            (1) * * *

           *       *       *       *       *       *       *

            (4) Prohibitions on financial institutions.--The 
        following prohibitions may be imposed against a 
        sanctioned person that is a financial institution:
                    (A) * * *

           *       *       *       *       *       *       *

        The imposition of either sanction under subparagraph 
        (A) or (B) shall be treated as 1 sanction for purposes 
        of [section 5] subsections (a)(1)(A) and (b) of section 
        5, and the imposition of both such sanctions shall be 
        treated as 2 sanctions for purposes of [section 5] 
        subsections (a)(1)(A) and (b) of section 5.

           *       *       *       *       *       *       *

    (b) Additional Mandatory Sanctions.--The sanctions to be 
imposed on a sanctioned person under paragraphs (1)(B) and (2) 
of section 5(a) are as follows:
            (1) Foreign exchange.--The President shall prohibit 
        any transactions in foreign exchange by the sanctioned 
        person.
            (2) Banking transactions.--The President shall 
        prohibit any transfers of credit or payments between, 
        by, through, or to any financial institution, to the 
        extent that such transfers or payments involve any 
        interest of the sanctioned person.
            (3) Property transactions.--The President shall 
        prohibit any acquisition, holding, withholding, use, 
        transfer, withdrawal, transportation, importation, or 
        exportation of, dealing in, or exercising any right, 
        power, or privilege with respect to, or transactions 
        involving, any property in which the sanctioned person 
        has any interest by any person, or with respect to any 
        property, subject to the jurisdiction of the United 
        States.
    (c) Additional Measure Relating to Refined Petroleum 
Products.--
            (1) In general.--The head of each executive agency 
        shall ensure that each contract with a person entered 
        into by such executive agency for the procurement of 
        goods or services, or agreement for the use of Federal 
        funds as part of a grant, loan, or loan guarantee to a 
        person, includes a clause that requires the person to 
        certify to the contracting officer or other appropriate 
        official of such agency that the person does not 
        conduct any activity described in paragraph (1)(B) or 
        (2) of section 5(a).
            (2) Remedies.--
                    (A) In general.--If the head of the 
                executive agency determines that such person 
                has submitted a false certification under 
                paragraph (1) after the date on which the 
                Federal Acquisition Regulation is revised to 
                implement the requirements of this subsection, 
                the head of an executive agency may terminate a 
                contract, or agreement described in paragraph 
                (1), with such person or debar or suspend such 
                person from eligibility for Federal contracts 
                or such agreements for a period not to exceed 
                15 years.
                    (B) Inclusion on list of parties excluded 
                from federal procurement and nonprocurement 
                programs.--The Administrator of General 
                Services shall include on the List of Parties 
                Excluded from Federal Procurement and 
                Nonprocurement Programs maintained by the 
                Administrator under part 9 of the Federal 
                Acquisition Regulation issued under section 25 
                of the Office of Federal Procurement Policy Act 
                (41 U.S.C. 421) each person that is debarred, 
                suspended, proposed for debarment or 
                suspension, or declared ineligible by the head 
                of an executive agency on the basis of a 
                determination of a false certification under 
                subparagraph (A).
                    (C) Rule of construction.--This subsection 
                shall not be construed to limit the use of 
                other remedies available to the head of an 
                executive agency or any other official of the 
                Federal Government on the basis of a 
                determination of a false certification under 
                paragraph (1).
            (3) Implementation through the federal acquisition 
        regulation.--Not later than 120 days after the date of 
        the enactment of the Iran Refined Petroleum Sanctions 
        Act of 2009, the Federal Acquisition Regulation issued 
        pursuant to section 25 of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 421) shall be revised 
        to provide for the implementation of the requirements 
        of this subsection.

           *       *       *       *       *       *       *

SEC. 8. TERMINATION OF SANCTIONS.

    [The requirement under section 5(a)] (a) Sanctions Relating 
to Investment.--The requirement under section 5(a)(1)(A) to 
impose sanctions shall no longer have force or effect [with 
respect to Iran] if the President determines and certifies to 
the appropriate congressional committees that Iran--
            (1) * * *

           *       *       *       *       *       *       *

    (b) Refined Petroleum Products.--The requirements under 
paragraphs (1)(B) and (2) of section 5(a) and section 6(b) to 
impose sanctions shall no longer have force or effect if the 
President determines and certifies to the appropriate 
congressional committees that Iran--
            (1) has ceased its efforts to design, develop, 
        manufacture, or acquire a nuclear explosive device or 
        related materials and technology; and
            (2) has ceased nuclear-related activities, 
        including uranium enrichment, that would facilitate the 
        efforts described in paragraph (1).

SEC. 9. DURATION OF SANCTIONS; PRESIDENTIAL WAIVER.

    (a) Delay of Sanctions.--
            (1) Consultations.--If the President makes a 
        determination described in section 5(a) [or 5(b)] or 
        5(b)(1) with respect to a foreign person, the Congress 
        urges the President to initiate consultations 
        immediately with the government with primary 
        jurisdiction over that foreign person with respect to 
        the imposition of sanctions under this Act.
            (2) Actions by government of jurisdiction.--In 
        order to pursue consultations under paragraph (1) with 
        the government concerned, the President may delay 
        imposition of sanctions under this Act for up to 90 
        days. Following such consultations, the President shall 
        immediately impose sanctions unless the President 
        determines and certifies to the Congress that the 
        government has taken specific and effective actions, 
        including, as appropriate, the imposition of 
        appropriate penalties, to terminate the involvement of 
        the foreign person in the activities that resulted in 
        the determination by the President under section 5(a) 
        [or 5(b)] or 5(b)(1) concerning such person.

           *       *       *       *       *       *       *

            (4) Report to congress.--Not later than 90 days 
        after making a determination under section 5(a) [or 
        5(b)] or 5(b)(1), the President shall submit to the 
        appropriate congressional committees a report on the 
        status of consultations with the appropriate foreign 
        government under this subsection, and the basis for any 
        determination under paragraph (3).

           *       *       *       *       *       *       *

    (c) Presidential Waiver.--
            (1) Authority.--The President may waive the 
        requirement in section 5 to impose a sanction or 
        sanctions on a person described in section 5(c), or on 
        a country described in section 5(b)(2)(A) (if the 
        President certifies to the appropriate congressional 
        committees that the President is unable to make the 
        determination described in such section 5(b)(2)(A) with 
        respect to the government of that country), and may 
        waive the continued imposition of a sanction or 
        sanctions under subsection (b) of this section, 30 days 
        or more after the President determines and so reports 
        to the appropriate congressional committees that it is 
        [important to the national interest of the United 
        States] vital to the national security interest of the 
        United States to exercise such waiver authority.
            (2) Contents of report.--Any report under paragraph 
        (1) shall provide a specific and detailed rationale for 
        the determination under paragraph (1), including--
                    (A) a description of the conduct that 
                resulted in the determination under section 
                5(a) [or (b)] or (b)(1), as the case may be;
                    (B) in the case of a foreign person, an 
                explanation of the efforts to secure the 
                cooperation of the government with primary 
                jurisdiction over the sanctioned person to 
                terminate or, as appropriate, penalize the 
                activities that resulted in the determination 
                under section 5(a) [or (b)] or (b)(1), as the 
                case may be;
                    [(C) an estimate of the significance of the 
                provision of the items described in section 
                5(a) or section 5(b) to Iran's ability to, 
                respectively, develop its petroleum resources 
                or its weapons of mass destruction or other 
                military capabilities; and]
                    (C) an estimate of the significance of the 
                provision of the items described in paragraph 
                (1) or (2) of section 5(a) or section 5(b)(1) 
                to Iran's ability to develop its petroleum 
                resources, to maintain or expand its domestic 
                production of refined petroleum products, to 
                import refined petroleum products, or to 
                develop its weapons of mass destruction or 
                other military capabilities (as the case may 
                be); and
                    (D) a statement as to the response of the 
                United States in the event that the person 
                concerned engages in other activities that 
                would be subject to section 5(a) [or (b)] or 
                (b)(1).

           *       *       *       *       *       *       *

SEC. 10. REPORTS REQUIRED.

    (a) Report on Certain International Initiatives.--Not later 
than 6 months after the date of the enactment of this Act, and 
every 6 months thereafter, the President shall transmit a 
report to the appropriate congressional committees describing--
            (1) * * *

           *       *       *       *       *       *       *

            [(4) Iran's use of Iranian diplomats and 
        representatives of other government and military or 
        quasi-governmental institutions of Iran to promote acts 
        of international terrorism or to develop or sustain 
        Iran's nuclear, chemical, biological, and missile 
        weapons programs.]
            (4) Iran's use in the Middle East, the Western 
        Hemisphere, Africa, and other regions, of Iranian 
        diplomats and representatives of other government and 
        military or quasi-governmental institutions or proxies 
        of Iran, including, but not limited to, Hezbollah, to 
        promote acts of international terrorism or to develop 
        or sustain Iran's nuclear, chemical, biological, and 
        missile weapons programs.

           *       *       *       *       *       *       *

    (d) Reports on Certain Business and Other Transactions 
Relating to Iran.--
            (1) In general.--Not later than 90 days after the 
        date of the enactment of the Iran Refined Petroleum 
        Sanctions Act of 2009, and every 6 months thereafter, 
        the President shall submit a report to the appropriate 
        congressional committees regarding any person who has--
                    (A) provided Iran with refined petroleum 
                products;
                    (B) sold, leased, or provided to Iran any 
                goods, services, or technology that would allow 
                Iran to maintain or expand its domestic 
                production of refined petroleum products; or
                    (C) engaged in any activity that could 
                contribute to the enhancement of Iran's ability 
                to import refined petroleum products.
            (2) Description.--For each activity set forth in 
        subparagraphs (A) through (C) of paragraph (1), the 
        President shall provide a complete and detailed 
        description of such activity, including--
                    (A) the date or dates of such activity;
                    (B) the name of any persons who 
                participated or invested in or facilitated such 
                activity;
                    (C) the United States domiciliary of the 
                persons referred to in subparagraph (B);
                    (D) any Federal Government contracts to 
                which the persons referred to in subparagraph 
                (B) are parties; and
                    (E) the steps taken by the United States to 
                respond to such activity.
            (3) Additional information.--The report required by 
        this subsection shall also include a list of--
                    (A) any person that the President 
                determines is an agent, alias, front, 
                instrumentality, representative, official, or 
                affiliate of the Islamic Revolutionary Guard 
                Corps or is an individual serving as a 
                representative of the Islamic Revolutionary 
                Guard Corps;
                    (B) any person that the President 
                determines has knowingly provided material 
                support to the Islamic Revolutionary Guard 
                Corps or an agent, alias, front, 
                instrumentality, representative, official, or 
                affiliate of the Islamic Revolutionary Guard 
                Corps; and
                    (C) any person who has conducted any 
                commercial transaction or financial transaction 
                with the Islamic Revolutionary Guards Corps or 
                an agent, alias, front, instrumentality, 
                representative, official, or affiliate of the 
                Islamic Revolutionary Guard Corps.
            (4) Form of reports; publication.--The reports 
        required under this subsection shall be--
                    (A) submitted in unclassified form, but may 
                contain a classified annex; and
                    (B) published in the Federal Register.
    (e) Reports on Global Trade Relating to Iran.--Not later 
than one year after the date of the enactment of the Iran 
Refined Petroleum Sanctions Act of 2009 and annually 
thereafter, the President shall submit to the appropriate 
congressional committees a report, with respect to the 
immediately preceding 12-month period, on the dollar value 
amount of trade, including in the energy sector, between Iran 
and each country maintaining membership in the Group of Twenty 
Finance Ministers and Central Bank Governors.

           *       *       *       *       *       *       *

SEC. 13. EFFECTIVE DATE; SUNSET.

    (a) * * *
    (b) Sunset.--This Act shall cease to be effective on 
December 31, [2011] 2016.

SEC. 14. DEFINITIONS.

    As used in this Act:
            (1) * * *
            (2) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means the 
        Committee on Finance, the Committee on Banking, 
        Housing, and Urban Affairs, and the Committee on 
        Foreign Relations of the Senate and the Committee on 
        Ways and Means, the Committee on Banking and Financial 
        Services, and the Committee on [International 
        Relations] Foreign Affairs of the House of 
        Representatives.

           *       *       *       *       *       *       *

            (13) Person.--The term ``person'' means--
                    (A) * * *
                    (B) a corporation, business association, 
                partnership, society, trust, financial 
                institution, insurer, underwriter, guarantor, 
                any other business organization, including any 
                foreign subsidiary, parent, or affiliate of 
                such a business organization, any other 
                nongovernmental entity, organization, or group, 
                and any governmental entity operating as a 
                business enterprise, such as an export credit 
                agency; and

           *       *       *       *       *       *       *

            [(14) Petroleum resources.--The term ``petroleum 
        resources'' includes petroleum and natural gas 
        resources.]
            (14) Knowingly.--The term ``knowingly'' means--
                    (A) having actual knowledge; or
                    (B) having the constructive knowledge 
                deemed to be possessed by a reasonable 
                individual who acts under similar 
                circumstances.
            (15) Petroleum resources.--The term ``petroleum 
        resources'' includes petroleum, oil or liquefied 
        natural gas, oil or liquefied natural gas tankers, and 
        products used to construct or maintain pipelines used 
        to transport oil or compressed or liquefied natural 
        gas.
            (16) Refined petroleum products.--The term 
        ``refined petroleum products'' means gasoline, 
        kerosene, diesel fuel, residual fuel oil, and 
        distillates and other goods classified in headings 2709 
        and 2710 of the Harmonized Tariff Schedule of the 
        United States.
            [(15)] (17) United states or state.--The term 
        ``United States'' or ``State'' means the several 
        States, the District of Columbia, the Commonwealth of 
        Puerto Rico, the Commonwealth of the Northern Mariana 
        Islands, American Samoa, Guam, the United States Virgin 
        Islands, and any other territory or possession of the 
        United States.
            [(16)] (18) United states person.--The term 
        ``United States person'' means--
                    (A)  * * *

           *       *       *       *       *       *       *

                                  
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