[Federal Register Volume 72, Number 53 (Tuesday, March 20, 2007)]
[Rules and Regulations]
[Pages 12980-12981]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-4950]


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DEPARTMENT OF THE TREASURY

Office of Foreign Assets Control

31 CFR Parts 538 and 560


Sudanese Sanctions Regulations; Iranian Transactions Regulations

AGENCY: Office of Foreign Assets Control, Treasury.

[[Page 12981]]


ACTION: Policy statement.

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SUMMARY: The Office of Foreign Assets Control of the U.S. Department of 
the Treasury is issuing this notice to clarify its policy with respect 
to the process for issuing one-year licenses to export agricultural 
commodities, medicine, and medical devices to Sudan and Iran pursuant 
to section 906 of the Trade Sanctions Reform and Export Enhancement Act 
of 2000, Title IX of Public Law 106-387 (October 28, 2000).

FOR FURTHER INFORMATION CONTACT: Assistant Director for Compliance 
Outreach & Implementation, tel.: 202/622-2490, Assistant Director for 
Licensing, tel.: 202/622-2480, Assistant Director for Policy, tel.: 
202/622-4855, or Chief Counsel, tel.: 202/622-2410, Office of Foreign 
Assets Control, Department of the Treasury, Washington, DC 20220.

Clarification of Policy With Respect to the Process for Issuing One-
Year Licenses To Export Agricultural Commodities, Medicine, and Medical 
Devices to Sudan and Iran

    The Trade Sanctions Reform and Export Enhancement Act of 2000, 
Title IX of Public Law 106-387 (October 28, 2000), as amended 
(``TSRA''), provides that, with certain exceptions, the President may 
not impose a unilateral agricultural sanction or unilateral medical 
sanction against a foreign country or foreign entity unless, at least 
60 days before imposing such a sanction, the President submits a report 
describing the proposed sanction and the reasons for it and Congress 
enacts a joint resolution approving the report. Section 906 of TSRA, 
however, requires that the export of agricultural commodities, 
medicine, and medical devices to Cuba, or to the government of a 
country that has been determined by the Secretary of State to have 
repeatedly provided support for acts of international terrorism, or to 
any entity in such country, shall only be made pursuant to one-year 
licenses issued by the United States Government. Section 906 also 
requires that procedures shall be in place to deny licenses for exports 
to any entity within such country that promotes international 
terrorism.
    Effective July 26, 2001, the Office of Foreign Assets Control 
(``OFAC'') promulgated amendments to the Sudanese Sanctions 
Regulations, 31 CFR part 538 (the ``SSR''), and the Iranian 
Transactions Regulations, 31 CFR part 560 (the ``ITR''), to implement 
section 906 of TSRA. See 66 FR 36683 (July 12, 2001) (the ``rule''). 
The preamble to the rule described an expedited process for the 
issuance of the one-year license required by section 906 for all 
exports and reexports of agricultural commodities, medicine, and 
medical devices to Sudan or Iran. The expedited process included, when 
appropriate, referral of the one-year license request to other 
government agencies for guidance in evaluating the request. If no 
government agency raised an objection to or concern with the 
application within nine business days from the date of any such 
referral, OFAC would issue the one-year license, provided that the 
request otherwise met the requirements set forth in the rule. 
Conversely, if any government agency raised an objection to the request 
within nine business days from the date of referral, OFAC would deny 
the license request. Finally, if any government agency raised a concern 
short of an objection with the request within nine business days from 
the date of referral, OFAC would delay its response to the license 
request for no more than thirty additional days to allow for further 
review of the request.
    OFAC instituted this expedited licensing process described in the 
preamble following the rule's publication in July 2001. However, the 
terrorist attacks of September 11, 2001, magnified concerns about 
international terrorism and proliferation of weapons of mass 
destruction. These concerns prompted greater scrutiny on the part of 
OFAC and other agencies of the U.S. Government of those entities within 
state sponsors of terrorism to whom agricultural commodities, medicine, 
and medical devices were being exported. Moreover, the volume of 
license requests has increased substantially since the inception of the 
TSRA program, and applications are now much more complicated than 
earlier ones, often involving dozens and sometimes hundreds of products 
and parties to the transaction. All of these factors have contributed 
to longer OFAC and interagency reviews of the applications, and thus 
longer processing times for the applications, than suggested in the 
preamble to the rule. This review is often further complicated by the 
fact that these license requests are evaluated both in terms of whether 
the foreign entities involved in the transaction ``promote 
international terrorism,'' as required by section 906 of TSRA, and in 
terms of whether the products at issue implicate independent export 
control regimes involving chemical or biological weapons or weapons of 
mass destruction, as provided in section 904(2)(C) of TSRA. Scrutiny of 
license applications on the latter ground often results in requests for 
additional information by the reviewing agencies, which neither the 
applicant nor OFAC can anticipate, further delaying the review process.
    Accordingly, today OFAC is issuing this notice to clarify its 
policy with respect to the licensing process for TSRA exports. OFAC 
will continue to conduct a review of all applications for one-year 
licenses consistent with the requirements of section 906 of TSRA, which 
may include a referral to other government agencies for guidance, and 
will respond to such applications upon completion of the review. Please 
be aware that OFAC's processing of one-year license requests may take 
longer than the time periods suggested at the inception of the TSRA 
program. OFAC will continue to respond to such applications in as 
timely a manner as is possible under the circumstances of each 
individual license application, consistent with OFAC's obligations 
under TSRA, the ITR, and the SSR.

    Dated: February 9, 2007.
Adam J. Szubin,
Director, Office of Foreign Assets Control.
 [FR Doc. E7-4950 Filed 3-19-07; 8:45 am]
BILLING CODE 4811-42-P