```

[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4992 Engrossed in House (EH)]

<DOC>
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
114th CONGRESS
  2d Session
                                H. R. 4992

_______________________________________________________________________

                                 AN ACT

 
 To codify regulations relating to transfers of funds involving Iran, 
                        and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``United States Financial System 
Protection Act of 2016''.

SEC. 2. FINDINGS, SENSE OF CONGRESS, AND STATEMENT OF POLICY.

    (a) Findings.--Congress finds the following:
            (1) On November 8, 2011, the Department of the Treasury 
        identified the Islamic Republic of Iran as a jurisdiction of 
        primary money laundering concern pursuant to section 5318A of 
        title 31, United States Code, including Iran's Central Bank, 
        private Iranian banks, branches, and subsidiaries of Iranian 
        banks operating outside of Iran as posing illicit finance risks 
        for the global financial system.
            (2) On November 6, 2008, the Department of the Treasury 
        announced that it was revoking the ``U-turn'' license for Iran, 
        stating that ``as a member of the Financial Action Task Force 
        (FATF), the United States today fulfilled its obligation to 
        strengthen measures to protect the financial sector from the 
        risks posed to the international financial system by Iran''.
            (3) On February 19, 2016, the Financial Action Task Force 
        (FATF), the global standard setting body for anti-money 
        laundering and combating the financing of terrorism which has 
        determined that Iran is a ``non-cooperating country or 
        territory'' in the fight against money laundering and terror 
        financing since 2008, stated that, ``the FATF remains 
        particularly and exceptionally concerned about Iran's failure 
        to address the risk of terrorist financing and the serious 
        threat this poses to the integrity of the international 
        financial system''.
            (4) United States and foreign businesses operating or 
        seeking to operate in Iran run significant risks, as corruption 
        in Iran is endemic, with Transparency International ranking 
        Iran 130 out of 168 countries.
    (b) Sense of Congress.--It is the sense of Congress that the entire 
financial sector of Iran, including Iran's Central Bank, private 
Iranian banks and branches, and subsidiaries of Iranian banks operating 
outside of Iran, poses illicit finance risks for the global financial 
system due to its proliferation, support for terrorism, and other 
illicit conduct.
    (c) Statement of Policy.--It shall be the policy of the United 
States to--
            (1) deny Iran access to funds denominated in United States 
        dollars, including through any offshore United States dollar 
        clearing system for transactions involving the Government of 
        Iran or an Iranian person; and
            (2) deny Iran access to United States dollars through any 
        offshore United States dollar clearing system conducted or 
        overseen by a foreign government or a foreign financial 
        institution for transactions involving the Government of Iran 
        or an Iranian person.

SEC. 3. CODIFICATION OF REGULATIONS RELATING TO TRANSFERS OF FUNDS 
              INVOLVING IRAN; CLARIFICATION OF APPLICATION OF 
              REGULATIONS TO FOREIGN DEPOSITORY INSTITUTIONS AND 
              FOREIGN REGISTERED BROKERS AND DEALERS.

    (a) Codification of Regulations.--Section 560.516 of title 31, Code 
of Federal Regulations, as in effect on January 1, 2016, shall apply 
with respect to transfers of funds to or from Iran, or for the direct 
or indirect benefit of an Iranian person or the Government of Iran, for 
the period beginning on or after January 1, 2016, and ending on the 
date on which the President makes the certification to the appropriate 
congressional committees under section 401(a) of the Comprehensive Iran 
Sanctions, Accountability, and Divestment Act of 2010 (22 U.S.C. 
8551(a)).
    (b) Clarification of Application of Regulations to Foreign 
Financial Institutions and Foreign Registered Brokers and Dealers.--
            (1) Foreign financial institutions.--Subsection (a) of 
        section 560.516 of title 31, Code of Federal Regulations, as in 
        effect on January 1, 2016, shall apply with respect to foreign 
        financial institutions to the same extent and in the same 
        manner as such subsection applies with respect to United States 
        depository institutions if the funds that are to be transferred 
        as described in such subsection are funds that are denominated 
        in United States dollars.
            (2) Foreign registered brokers and dealers.--Subsection (b) 
        of section 560.516 of title 31, Code of Federal Regulations, as 
        in effect on January 1, 2016, shall apply with respect to 
        foreign registered brokers or dealers in securities to the same 
        extent and in the same manner as such subsection applies with 
        respect to United States registered brokers or dealers in 
        securities if the funds that are to be transferred as described 
        in such subsection are funds that are denominated in United 
        States dollars.
            (3) Suspension.--The President may suspend the application 
        of paragraph (1) with respect to a foreign financial 
        institution or the application of paragraph (2) with respect to 
        a foreign registered broker or dealer in securities for a 
        period not to exceed 60 days, and the President may renew the 
        suspension of the application of paragraph (1) or paragraph 
        (2), respectively, for additional periods of not more than 60 
        days, on and after the date on which the President certifies to 
        the appropriate congressional committees that during the 
        preceding 60-day period the Government of Iran is in compliance 
        with the criteria described in section 401(a)(1) of the 
        Comprehensive Iran Sanctions, Accountability, and Divestment 
        Act of 2010 (22 U.S.C. 8551(a)(1)).
    (c) Licensing Restrictions.--
            (1) In general.--Except as provided in paragraph (2), the 
        President may not issue any license under the International 
        Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) or 
        provide other guidance, including executive actions, rules, 
        regulations, frequently asked questions, written 
        communications, or any other commitments, that permits--
                    (A) a United States depository institution or 
                United States registered broker or dealer in 
                securities--
                            (i) to conduct an offshore United States 
                        dollar clearing system for transactions 
                        involving or for the benefit of the Government 
                        of Iran or an Iranian person, including to 
                        process transfers of funds to or from Iran 
                        under section 560.516 of title 31, Code of 
                        Federal Regulations, as in effect on January 1, 
                        2016; or
                            (ii) to provide United States dollars for 
                        any offshore United States dollar clearing 
                        system conducted or overseen by a foreign 
                        government or a foreign financial institution 
                        for transactions involving or for the benefit 
                        of the Government of Iran or an Iranian person, 
                        including to process transfers of funds to or 
                        from Iran under section 560.516 of title 31, 
                        Code of Federal Regulations, as in effect on 
                        January 1, 2016; or
                    (B) a foreign financial institution or foreign 
                registered broker or dealer in securities--
                            (i) to conduct an offshore United States 
                        dollar clearing system for transactions 
                        involving or for the benefit of the Government 
                        of Iran or an Iranian person, including to 
                        process transfers of funds to or from Iran 
                        under section 560.516 of title 31, Code of 
                        Federal Regulations, as in effect on January 1, 
                        2016, and as applied under subsection (b); or
                            (ii) to provide United States dollars for 
                        any offshore United States dollar clearing 
                        system conducted or overseen by a foreign 
                        government or a foreign financial institution 
                        for transactions involving or for the benefit 
                        of the Government of Iran or an Iranian person, 
                        including to process transfers of funds to or 
                        from Iran under section 560.516 of title 31, 
                        Code of Federal Regulations, as in effect on 
                        January 1, 2016, and as applied under 
                        subsection (b).
            (2) Exception for humanitarian purposes.--The President 
        may, on a case-by-case basis, issue a license described in 
        paragraph (1) to authorize the activities described in clause 
        (i) or (ii) of paragraph (1)(A) or the activities described in 
        clause (i) or (ii) of paragraph (1)(B) if--
                    (A) such activities relate solely to--
                            (i) the provision of agricultural 
                        commodities, food, medicine, or medical devices 
                        to Iran; or
                            (ii) the provision of humanitarian 
                        assistance to the people of Iran; and
                    (B) the President submits to the appropriate 
                congressional committees a copy of the license.
    (d) Definitions.--In this section:
            (1) Appropriate congressional committees.--The term 
        ``appropriate congressional committees'' means--
                    (A) the Committee on Foreign Affairs and the 
                Committee on Financial Services of the House of 
                Representatives; and
                    (B) the Committee on Foreign Relations and the 
                Committee on Banking, Housing, and Urban Affairs of the 
                Senate.
            (2) Foreign financial institution.--The term ``foreign 
        financial institution'' has the meaning given such term in 
        section 1010.605 of title 31, Code of Federal Regulations, as 
        in effect on January 1, 2016.
            (3) Iran.--The term ``Iran'' has the meaning given the term 
        in section 561.329 of title 31, Code of Federal Regulations, as 
        in effect on January 1, 2016.
            (4) Iranian person.--The term ``Iranian person'' means a 
        person or entity (as such terms are defined in section 560.305 
        of title 31, Code of Federal Regulations, as in effect on 
        January 1, 2016) that--
                    (A) is organized under the laws of Iran or any 
                jurisdiction within Iran (including foreign branches); 
                or
                    (B) is a person in Iran.
            (5) Transfer of funds.--The term ``transfer of funds''--
                    (A) has the meaning given the term ``funds 
                transfer'' in section 1010.100 of title 31, Code of 
                Federal Regulations, as in effect on January 1, 2016; 
                and
                    (B) includes a transfer of funds or other property 
                for the benefit of an Iranian financial institution 
                that is made between accounts of the same financial 
                institution even if that Iranian financial institution 
                is not the direct recipient of the transfer.
            (6) United states depository institution.--The term 
        ``United States depository institution'' has the meaning given 
        such term in section 560.319 of title 31, Code of Federal 
        Regulations, as in effect on January 1, 2016.
            (7) United states registered broker or dealer in 
        securities.--The term ``United States registered broker or 
        dealers in securities'' has the meaning given such term in 
        section 560.321 of title 31, Code of Federal Regulations, as in 
        effect on January 1, 2016.

SEC. 4. CERTIFICATION REQUIREMENT FOR REMOVAL OF DESIGNATION OF IRAN AS 
              A JURISDICTION OF PRIMARY MONEY LAUNDERING CONCERN.

    (a) In General.--The President may not rescind a preliminary draft 
rule or final rule (as in effect on the day before the date of the 
enactment of this Act) that provides for the designation of Iran as a 
jurisdiction of primary money laundering concern pursuant to section 
5318A of title 31, United States Code, unless the President submits to 
the appropriate congressional committees a certification described in 
subsection (b) with respect to Iran.
    (b) Certification.--The President may rescind a preliminary draft 
rule or final rule described in subsection (a) if the President submits 
to the appropriate congressional committees a certification that the 
Government of Iran is no longer engaged in support for terrorism, 
pursuit of weapons of mass destruction, and any illicit and deceptive 
financial activities.
    (c) Form.--The certification described in subsection (b) shall be 
submitted in unclassified form, but may contain a classified annex.
    (d) Definition.--In this section, the term ``appropriate 
congressional committees'' means--
            (1) the Committee on Foreign Affairs and the Committee on 
        Financial Services of the House of Representatives; and
            (2) the Committee on Banking, Housing, and Urban Affairs of 
        the Senate.

            Passed the House of Representatives July 14, 2016.

            Attest:

                                                                 Clerk.
114th CONGRESS

  2d Session

                               H. R. 4992

_______________________________________________________________________

                                 AN ACT

 To codify regulations relating to transfers of funds involving Iran, 
                        and for other purposes.
```