I
104TH CONGRESS
2D SESSION
H. R. 3107
To impose sanctions on persons exporting certain goods or technology that
would enhance Iran’s ability to explore for, extract, refine, or transport
by pipeline petroleum resources, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 19, 1996
Mr. GILMAN (for himself, Mr. BERMAN, Mr. GEJDENSON, Mr. BURTON of In-
diana, Mr. KING, Mr. SHAW, and Mr. FORBES) introduced the following
bill; which was referred to the Committee on International Relations, and
in addition to the Committees on Banking and Financial Services, Ways
and Means, and Government Reform and Oversight, for a period to be
subsequently determined by the Speaker, in each case for consideration
of such provisions as fall within the jurisdiction of the committee con-
cerned
A BILL
To impose sanctions on persons exporting certain goods or
technology that would enhance Iran’s ability to explore
for, extract, refine, or transport by pipeline petroleum
resources, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Iran Oil Sanctions Act
of 1996’’.
SEC. 2. FINDINGS.
The Congress makes the following findings:
(1) The efforts of the Government of Iran to
acquire weapons of mass destruction and the means
to deliver them and its support of international ter-
rorism endanger potentially the national security
and foreign policy interests of the United States and
those countries with which it shares common strate-
gic and foreign policy objectives.
(2) The objective of preventing the proliferation
of weapons of mass destruction and international
terrorism through existing multilateral and bilateral
initiatives requires additional efforts to deny Iran
the financial means to sustain its nuclear, chemical,
biological, and missile weapons programs.
(3) The Government of Iran uses its diplomatic
facilities and quasi-governmental institutions outside
of Iran to promote acts of international terrorism
and assist its nuclear, chemical, biological, and mis-
sile weapons programs.
SEC. 3. DECLARATION OF POLICY.
The Congress declares that it is the policy of the
United States to deny Iran the ability to support inter-
national terrorism and to fund the development and acqui-
sition of weapons of mass destruction and the means to
deliver them by limiting the development of Iran’s ability
$10,000,000 each, which in the aggregate equals or
exceeds $40,000,000 in any 12-month period), that
directly contributed to the enhancement of Iran’s
ability to develop petroleum resources of Iran.
(b) PERSONS AGAINST WHICH THE SANCTIONS ARE
TO BE IMPOSED.—The sanctions described in subsection
(a) shall be imposed on—
(1) the person with respect to whom the Presi-
dent makes the determination subsection (a);
(2) any successor entity to the person with re-
spect to whom the President makes the determina-
tion subsection (a);
(3) any wholly owned subsidiary of the person
with respect to whom the President makes the deter-
mination subsection (a);
(4) any other subsidiary of the person with re-
spect to whom the President makes the determina-
tion under subsection (a) if that subsidiary, with ac-
tual knowledge or reason to know, engaged in the
activities which were the basis of that determination;
(5) any person that is a parent of the person
with respect to whom the President makes the deter-
mination under subsection (a) if that parent had ac-
tual knowledge or reason to know of the activities
which were the basis of that determination; and
(6) any person that is an affiliate of the person
with respect to whom the President makes the deter-
mination under subsection (a) if that affiliate, with
actual knowledge or reason to know, engaged in the
activities which were the basis of that determination.
For purposes of this Act, any person or entity described
in this subsection shall be referred to as a ‘‘sanctioned
person’’.
(c) PUBLICATION
IN
FEDERAL
REGISTER.—The
President shall cause to be published in the Federal Reg-
ister a current list of sanctioned persons. The removal of
names from, and the addition of names to, the list, shall
also be so published.
(d) EXCEPTIONS.—The President shall not be re-
quired to apply or maintain the sanctions under subsection
(a)—
(1) in the case of procurement of defense arti-
cles or defense services—
(A) under existing contracts or sub-
contracts, including the exercise of options for
production quantities to satisfy requirements
essential to the national security of the United
States;
(B) if the President determines in writing
that the person to which the sanctions would
otherwise be applied is a sole source supplier of
the defense articles or services, that the defense
articles or services are essential, and that alter-
native sources are not readily or reasonably
available; or
(C) if the President determines in writing
that such articles or services are essential to the
national security under defense coproduction
agreements;
(2) to products or services provided under con-
tracts entered into before the date on which the
President publishes his intention to impose the sanc-
tions;
(3) to—
(A) spare parts which are essential to
United States products or production;
(B) component parts, but not finished
products, essential to United States products or
production; or
(C) routine servicing and maintenance of
products, to the extent that alternative sources
are not readily or reasonably available;
(4) to information and technology essential to
United States products or production; or
(5) to medicines, medical supplies, or other hu-
manitarian items.
SEC. 5. DESCRIPTION OF SANCTIONS.
The sanctions to be imposed on a sanctioned person
under section 4(a) are as follows:
(1) EXPORT-IMPORT
BANK
ASSISTANCE
FOR
EXPORTS TO SANCTIONED PERSONS.—The President
shall direct the Export-Import Bank of the United
States not to guarantee, insure, extend credit, or
participate in the extension of credit in connection
with the export of any goods or services to any sanc-
tioned person.
(2) TRADE
SANCTION.—The President shall
both—
(A) order the United States Government
not to issue any specific license and not to
grant any other specific permission or authority
to export any goods or technology to a sanc-
tioned person under—
(i) the Export Administration Act of
1979;
(ii) the Arms Export Control Act;
(iii) the Atomic Energy Act of 1954;
or
(iv) any other statute that requires
the prior review and approval of the Unit-
ed States Government as a condition for
the export or re-export of goods or serv-
ices; and
(B) prohibit the importation into the Unit-
ed States of products produced by any sanc-
tioned person.
Subparagraph (B) includes application to the impor-
tation of any finished product or component part,
whether shipped directly by the sanctioned person or
by another entity.
(3) LOANS FROM UNITED STATES FINANCIAL
INSTITUTIONS.—The United States Government
shall prohibit any United States financial institution
from making any loan or providing any credit to any
sanctioned 
person 
in 
an 
amount 
exceeding
$10,000,000 (or two or more loans of more than
$5,000,000 each in any 12-month period) unless
such person is engaged in activities to relieve human
suffering and the loan, loans, or credit is provided
for such activities.
(4) PROHIBITIONS
ON
FINANCIAL
INSTITU-
TIONS.—The following prohibitions shall be imposed
against a sanctioned person that is a financial insti-
tution:
(A) DESIGNATION AS PRIMARY DEALER.—
Neither the Board of Governors of the Federal
Reserve System nor the Federal Reserve Bank
of New York may designate, or permit the con-
tinuation of any prior designation of, such fi-
nancial institution as a primary dealer in Unit-
ed States Government debt instruments.
(B) GOVERNMENT FUNDS.—Such financial
institution shall not serve as agent of the Unit-
ed States Government or serve as repository for
United States Government funds.
(5) PROCUREMENT
SANCTION.—The United
States Government shall not procure, or enter into
any contract for the procurement of, any goods or
services from a sanctioned person.
SEC. 6. ADVISORY OPINIONS.
The Secretary of State may, upon the request of any
person, issue an advisory opinion to that person as to
whether a proposed activity by that person would subject
that person to sanctions under this Act. Any person who
relies in good faith on such an advisory opinion which
states that the proposed activity would not subject a per-
son to much sanctions, and any person who thereafter en-
(2) CONTENTS OF REPORT.—Any such report
shall provide a specific and detailed rationale for
such determination, including—
(A) a description of the conduct that re-
sulted in the determination;
(B) in the case of a foreign person, an ex-
planation of the efforts to secure the coopera-
tion of the government with primary jurisdic-
tion of the sanctioned person to terminate or,
as appropriate, penalize the activities that re-
sulted in the determination;
(C) an estimate as to the significance of
the investment or the provision of the goods or
technology, as the case may be, to Iran’s ability
to develop its petroleum resources; and
(D) a statement as to the response of the
United States in the event that such person en-
gages in other activities that would be subject
to section 4(a).
(3) EFFECT OF REPORT ON WAIVER.—If the
President makes a report under paragraph (1) with
respect to a waiver of sanctions on a person in sec-
tion 4(b), sanctions need not be imposed under sec-
tion 4(a) on that person during the 30-day period
referred to in paragraph (1).
SEC. 9. GOODS AND TECHNOLOGY SUBJECT TO EXPORT
CONTROL RESTRICTIONS.
(a) CONTROL LIST.—
(1) CONTENTS OF LIST.—For purposes of the
determinations to be made under section 4(a), the
President, in consultation with the Secretary of
State and the Secretary of Energy, and the heads of
other appropriate departments and agencies, shall
establish and maintain the List of Petroleum and
Natural Gas-Related Goods and Technology. The
List shall consist of—
(A) all items listed in the Annex to Resolu-
tion 883 of the Security Council of the United
Nations, adopted November 11, 1993, and all
types of equipment, supplies, and grants of li-
censes prohibited by paragraph 5 of that resolu-
tion; and
(B) any other goods or technology (includ-
ing software and technical data) that the Presi-
dent determines could significantly or materially
contribute to Iran’s ability to develop its petro-
leum resources, including goods and technology
that are required for the development, produc-
tion, or use of facilities (including the repair,
maintenance, or operation of equipment) for the
development of petroleum resources.
(2) PUBLICATION.—The President, within 60
days after the date of the enactment of this Act,
shall cause the List to be published in the Federal
Register, together with any regulations issued with
respect thereto. Thereafter, any revisions to the List
or amendments to the regulations shall be published
in the same manner.
(3) ADVANCE NOTICE TO CONGRESS.—Not less
than 30 days in advance of the publication of the
List, it shall be provided to the Committee on Bank-
ing, Housing, and Urban Affairs of the Senate and
to the Committee on International Relations of the
House of Representatives. The President shall con-
sult with such Committee regarding the content of
the List and shall respond to questions regarding
the basis for the inclusion on, or exclusion from, the
List of specified goods and technology.
(b) STATUTORY CONSTRUCTION.—Nothing in this
section prevents the inclusion on the List of any goods
or technology that may be produced in and traded inter-
nationally by persons or entities in countries other than
the United States.
SEC. 10. REPORTS REQUIRED.
(a) REPORT ON CERTAIN INTERNATIONAL INITIA-
TIVES.—Not later than 6 months after the date of the en-
actment of this Act, and every 6 months thereafter, the
President shall transmit a report to the appropriate con-
gressional committees describing—
(1) the efforts of the President to mount a mul-
tilateral campaign to persuade all countries to pres-
sure Iran to cease its weapons of mass destruction
programs and its support of international terrorism;
(2) the efforts of the President to persuade
other governments to ask Iran to reduce the pres-
ence of Iranian diplomats and representatives of
other government and military or quasi-govern-
mental institutions of Iran and to withdraw any
such diplomats or representatives who participated
in the takeover of the United States embassy in
Tehran on November 4, 1979, or the subsequent
holding of United States hostages for 444 days;
(3) the extent to which the International
Atomic Energy Agency has established regular
inspections of all nuclear facilities in Iran, in-
cluding those presently under construction; and
(4) Iran’s use of Iranian diplomats and rep-
resentatives of other government and military or
quasi-governmental institutions of Iran to promote
acts of terrorism or to develop or sustain Iran’s nu-
clear, chemical, biological, and missile weapons pro-
grams.
(b) OTHER REPORTS.—The President shall ensure
the continued transmittal to the Congress of reports de-
scribing—
(1) the nuclear and other military capabilities
of Iran, as required by section 601(a) of the Nuclear
Non-Proliferation act of 1978 and section 1607 of
the National Defense Authorization Act, Fiscal Year
1993; and
(2) the support provided by Iran for acts of
international terrorism, as part of the Department
of State’s annual report on international terrorism.
SEC. 11. APPLICATION OF THE ACT TO LIBYA.
(a) IN GENERAL.—The sanctions of this Act, includ-
ing the terms and conditions for the imposition, duration,
and termination of sanctions, shall apply to persons mak-
ing investments with respect to the development of petro-
leum resources of Libya, or exporting, transferring, or re-
leasing of certain goods or technology to Libya, nationals
of Libya, or entities owned or controlled by Libya, in the
same manner as those sanctions apply under this Act to
persons making investments with respect to the develop-
ment of petroleum resources of Iran, or exporting, trans-
ferring, or releasing of certain goods or technology to Iran,
nationals of Iran, or entities owned or controlled by Iran.
(b) APPLICATION OF SPECIFIC PROVISIONS.—In ap-
plying the provisions of this Act with respect to Libya
under subsection (a) each reference to ‘‘Iran’’ shall be
deemed to be a reference to ‘‘Libya’’.
SEC. 12. DETERMINATIONS NOT REVIEWABLE.
A determination to impose sanctions under this Act
shall not be reviewable in any court.
SEC. 13. DEFINITIONS.
As used in this Act:
(1) ACT OF INTERNATIONAL TERRORISM.—The
term ‘‘act of international terrorism’’ means an
act—
(A) which is violent or dangerous to
human life and that is a violation of the crimi-
nal laws of the United States or of any State
or that would be a criminal violation if commit-
ted within the jurisdiction of the United States
or any State; and
(B) which appears to be intended—
(i) to intimidate or coerce a civilian
population;
(ii) to influence the policy of a govern-
ment by intimidation or coercion; or
(iii) to affect the conduct of a govern-
ment by assassination or kidnapping.
(2) AFFILIATE.—For purposes of section 4(b),
a person is an ‘‘affiliate’’ of another person if more
than 50 percent of the outstanding capital stock or
other beneficial interest in both persons is owned by
a third person or both persons are otherwise con-
trolled by a third person.
(3) APPROPRIATE
CONGRESSIONAL
COMMIT-
TEES.—The term ‘‘appropriate congressional com-
mittees’’ means the Committees on Banking, Hous-
ing, and Urban Affairs and Foreign Relations of the
Senate and the Committee on International Rela-
tions of the House of Representatives.
(4) COMPONENT PART.—The term ‘‘component
part’’ has the meaning given that term in section
11A(e)(1) of the Export Administration Act of 1979
(50 U.S.C. App. 2410a(e)(1)).
(5) DEVELOP
AND
DEVELOPMENT.—To ‘‘de-
velop’’, or the ‘‘development’’ of, petroleum resources
means the exploration for, or the extraction, refin-
ing, or transportation by pipeline of, petroleum re-
sources.
(6) FINANCIAL
INSTITUTION.—The term ‘‘fi-
nancial institution’’ includes—
(A) a depository institution (as defined in
section 3(c)(1) of the Federal Deposit Insur-
ance Act), including a branch or agency of a
foreign bank (as defined in section 1(b)(7) of
the International Banking Act of 1978);
(B) a credit union;
(C) a securities firm, including a broker or
dealer;
(D) an insurance company, including an
agency or underwriter;
(E) any other company that provides fi-
nancial services; and
(F) any subsidiary of an entity described
in any of subparagraphs (A) through (E).
(7) FINISHED PRODUCT.—The term ‘‘finished
product’’ has the meaning given that term in section
11A(e)(2) of the Export Administration Act of 1979
(50 U.S.C. App. 2410a(e)(2)).
(8) FOREIGN PERSON.—The term ‘‘foreign per-
son’’ means—
(A) an individual who is not a United
States person or an alien lawfully admitted for
permanent residence into the United States; or
(B) a corporation, partnership, or other
nongovernment entity which is not a United
States person.
(9) GOODS
AND
TECHNOLOGY.—The terms
‘‘goods’’ and ‘‘technology’’ have the meanings given
those terms in section 16 of the Export Administra-
tion Act of 1979 (50 U.S.C. app. 2415).
(10) INVESTMENT.—The term ‘‘investment’’
means—
(A) the entry into a contract that includes
responsibility for the development of petroleum
resources located in Iran or Libya (as the case
may be), or the entry into a contract providing
for the general supervision and guarantee of an-
ther person’s performance of such a contract;
(B) the purchase of a share of ownership
in that development;
(C) the entry into a contract providing for
the participation in royalties, earnings, or prof-
its in that development, without regard to the
form of the participation; or
(D) the entry into or performance of—
(i) a contract for the financing of the
development of petroleum resources located
in Iran or Libya (as the case may be); or
(ii) a guaranty of another person’s
performance under such a contract.
(11) IRAN.—The term ‘‘Iran’’ means—
(A) the territory of Iran; and
(B) any territory or marine areas over
which the Government of Iran claims sov-
ereignty, sovereign rights, or jurisdiction, if the
Government of Iran exercises partial or de facto
control over such territory or areas or derives a
benefit from economic activity in the territory
or area pursuant to an international agreement.
(12) IRANIAN
DIPLOMATS
AND
REPRESENTA-
TIVES OF OTHER GOVERNMENT AND MILITARY OR
QUASI-GOVERNMENTAL
INSTITUTIONS
OF
IRAN.—
The term ‘‘Iranian diplomats and representatives of
other government and military or quasi-govern-
mental institutions of Iran’’ includes employees, rep-
resentatives, or affiliates of Iran’s—
(A) Foreign Ministry;
(B) Ministry of Intelligence and Security;
(C) Revolutionary Guard Corps;
(D) Crusade for Reconstruction;
(E) Qods (Jerusalem) Forces;
(F) Interior Ministry;
(G) Foundation for the Oppressed and
Disabled;
(H) Prophet’s Foundation;
(I) June 5th Foundation;
(J) Martyr’s Foundation;
(K) Islamic Propagation Organization; and
(L) Ministry of Islamic Guidance.
(13) LIBYA.—The term ‘‘Libya’’ means—
(A) the territory of Libya; and
(B) any territory or marine areas over
which the Government of Libya claims sov-
ereignty, sovereign rights, or jurisdiction, if the
Government of Libya exercises partial or de
facto control over such territory or area or de-
rives a benefit from economic activity in the ter-
ritory or area pursuant to an international
agreement.
(14) NUCLEAR EXPLOSIVE DEVICE.—The term
‘‘nuclear explosive device’’ means any device, wheth-
er assembled or disassembled, that is designed to
produce an instantaneous release of an amount of
nuclear energy from special nuclear material (as de-
fined in section 11aa. of the Atomic Energy Act of
1954) that is greater than the amount of energy
that would be released from the detonation of one
pound of trinitrotoluene (TNT).
(15) PARENT.—For purposes of section 4(b), a
person is a ‘‘parent’’ of another person if that per-
son owns, directly or indirectly, more than 50 per-
cent of the outstanding capital stock or other bene-
ficial interest in that other person, or otherwise con-
trols that other person.
(16) PERSON.—The term ‘‘person’’ means a
natural person as well as a corporation, business as-
sociation, partnership, society, trust, any other non-
governmental entity, organization, or group, and any
governmental entity operating as a business enter-
prise, and any successor to any such entity.
(18) PETROLEUM RESOURCES.—The term ‘‘pe-
troleum resources’’ includes petroleum and natural
gas resources.
(19) SUBSIDIARY.—(A) For purposes of section
4(b), and subject to subparagraph (B), a person is
a ‘‘subsidiary’’ of another person if that other per-
son owns, directly or indirectly, more than 50 per-
cent of the outstanding capital stock or other bene-
ficial interest in that person, or otherwise controls
that person.