Effective September 21, 2004, when the President ended the national emergency between theUnited States and Libya, most economic sanctions that impeded trade and travel were lifted. Whatremains are restrictions mostly related to the United States having found that Libya is a state sponsorof acts of international terrorism, or that Libya does not cooperate fully with U.S. antiterrorismefforts: the United States requires a validated license to export certain goods or technology to Libya; the United States generally prohibits the export of defense articles and defenseservices to Libya; the United States generally denies Libya non-humanitarian foreign assistance,non-emergency agricultural aid, Peace Corps programs, or Export-Import Banksupport; the U.S. Executive Director in each international financial institution isinstructed to oppose loans or other funding to Libya; and certain contracts awarded by the State Department for diplomatic securityconstruction may not be awarded to any person "doing business with Libya." Until recently, the United States has maintained a fairly comprehensive range of economicsanctions on Libya. Muammar al-Qadhafi rose to power, as part of a military overthrow of apro-Western king, in 1969. Early in his tenure, Qadhafi was drawn into the Soviet camp as animportant regional actor in the Cold War. In response to that alliance, the United States terminatedmilitary sales to Libya in 1973, began to suspend export licenses for dual-use material in 1978, andplaced Libya on the first list denoting state sponsors of international terrorism, issued in 1979. Over the years, Libya's sanctionable adventures, at least from the perspective of U.S. foreignpolicymakers, have run second to none. In the early 1970s, Libya sent military troops and financedextremist Palestinian activities in Lebanon. Later in the decade, Libya sent armed forces into Chadand Uganda. Throughout the 1970s and well into the 1980s, Libya financed or materially supportedrevolutionary efforts in Chad, Corsica, Eritrea, Germany, Iran, Italy, Nicaragua, Northern Ireland,Japan, Lebanon, Philippines, Sardinia, Somalia, Sudan, Syria, Thailand, and Tunisia. Libya wasinvolved in aircraft hijackings, extraterritorial assassinations, bombings at European airports, andthe 1986 bombing of a Berlin nightclub popular with American Armed Forces. (1) Libya gave safe haven toBlack September, the Palestinian terrorists that seized Israeli athlete as hostages at the 1972Olympics in Munich. (2) Libya was found to have a central role in orchestrating and financing the in-air bombing of Pan Amflight 103 over Lockerbie, Scotland on December 21, 1988, killing 270, and the bombing of FrenchUTA flight 772, in flight from Niger to Paris, in September 1989, killing 177. In March 1992, after the United States, France, and the United Kingdom began legalproceedings against Libyan intelligence officers, in absentia , for their role in the two airlinebombings, the United Nations Security Council, in 1992 and 1993, agreed to resolutions to condemnthe terrorist acts, impose an arms and air traffic embargo, prohibit trade in Libyan oil, and freezeLibya's assets. (3) Thesesanctions were lifted on September 12, 2003, after Libya took responsibility for the destruction ofthe two planes and agreed to pay a financial settlement to the families of those killed on PanAm 103and UTA 772. (4) On December 19, 2003, Libya's Foreign Ministry released a statement declaring that,following extended discussions with the United States and the United Kingdom in which it wasrevealed that Libya had the materials and the means to produce weapons of mass destruction andrelated delivery systems, Libya had "decided of its free will to get rid of these materials, equipmentand programs, and to become totally free of internationally banned weapons." Libya further statedits intention to comply with the Missile Technology Control Regime (MTCR), the nuclearNonproliferation Treaty (NPT), and international biological and chemical weapons treaties andagreements, and to open itself to inspections in all these areas. Libya "... is convinced that the armsrace is neither in its interest or in that of the region and goes against its strong desire for a worldenjoying security and peace and wants all states to follow suit, starting with the Middle East regionwithout exception." (6) Both President Bush and Prime Minister Blair issued statements of cautious optimism,assuring that vigilance would guide any efforts to remove economic and diplomatic sanctions --imposed not only for arms control violations but also for Libya's support of international terrorismand revolutionary separatist movements. On April 23, 2004, President Bush announced that "Libya has set a standard that we hopeother nations will emulate in rejecting weapons of mass destruction and in working withinternational organizations to halt the proliferation of the world's most dangerous systems." Hedetermined that Libya had met the terms required of it in United Nations Security Councilresolutions adopted in the aftermath of the destruction of PanAm Flight 103 over Lockerbie,Scotland in 1991. Thus, restrictions under the Iran and Libya Sanctions Act were removed, andsome restrictions on licensing and transactions were eased. (7) The President also announced that the United States would (1) liftits objection to Libya's accession to the World Trade Organization; (8) (2) work toward resuming fulldiplomatic ties; and (3) pursue educational exchanges between the two countries. (9) To reward Libya for its changed stance on settling the PanAm103 and UTA 772 complaints,and for its new pronouncements to turn away from the pursuit of nuclear weapons capability, onFebruary 23, 2004, the Secretary of State removed restrictions on the use of U.S. passports in, to, orthrough Libya. And on June 28, 2004, the State Department announced it was opening a U.S.Liaison Office in Libya's capitol, to replace the Interests Section in the Embassy of Belgium that hadfilled the 24-year gap while the U.S. Embassy was shuttered. (10) On September 10, 2004, the President determined that (1) Libya had violated terms of theArms Export Control Act by receiving nuclear enrichment equipment, material, or technology fromKhan Laboratories in Pakistan, but that (2) implementation of the sanctions required under the ArmsExport Control Act "would have a serious adverse effect on vital United States interests." ThePresident, further, determined that new restrictions on Export-Import Bank support to U.S. exporterspursuing business in Libya were not in the national interest of the United States. (11) A spokesperson for theExport-Import Bank pointed out that the new sanctions imposed and immediately waived onSeptember 10th did not affect other restrictions on Bank activity in effect because of Libya's placeon the list of state sponsors of international terrorism. (12) Effective September 21, 2004, President Bush, citing Libya's commitments and actions toeliminate its weapons of mass destruction programs and related missiles, revoked four ExecutiveOrders that had restricted nearly all trade with Libya since 1985: (13) Executive Order 12538, issued November 15, 1985, pursuant to sec. 504 of theInternational Security and Development Cooperation Act of 1985, which prohibited the importationof petroleum products from Libya; Executive Order 12543, issued January 7, 1986, pursuant to the NationalEmergencies Act (NEA) and International Emergency Economic Powers Act (IEEPA), whichdeclared that a national emergency existed, and prohibited imports, exports, transactions related totransportation, the provision of transportation, purchase of Libyan products via a third country,performance of contracts, or extension of credit or loans; Executive Order 12544, issued January 8, 1986, also under the authority ofNEA and IEEPA, which blocked all property, assets, and interests held by Libya in the jurisdictionof the United States; and Executive Order 12801, issued April 15, 1992, under the authority of NEA andIEEPA, which prohibited the landing or taking off in U.S. airspace of aircraft coming from or goingto Libya. Libya remains listed as a state sponsor of international terrorism. As such, it is ineligible formost foreign assistance, trade in defense articles and defense services, support in the internationalfinancial institutions, and some commercial transactions involving dual-use or high technologycontinue to be limited. Libya is considered a state sponsor of international terrorism pursuant to Section 6(j) of theExport Administration Act of 1979 (50 U.S.C. app. 2405(j)) (hereafter "EAA"). (14) Under terms of thatsection, exports to Libya of goods or technology require a validated license, and there is otherwisea presumption of denial of licenses for items that the Secretary of State determines could make asignificant contribution to the country's military potential or could enhance the country's ability tosupport acts of international terrorism. The Secretary is further required to notify Congress inadvance of issuing any validated license. Section 6(j)(4) states that the Secretary's designation maynot be rescinded unless the President submits to Congress one of two possible reports. The firstwould certify that (I) there has been a fundamental change in the leadership and policies of thegovernment; (ii) the government is not supporting acts of international terrorism; and (iii) thegovernment has provided assurances that it will not support acts of international terrorism in thefuture. The second option available to the President would be to certify, at least 45 days before theproposed rescission would take effect, that (I) the government concerned has not provided anysupport for international terrorism during the preceding six-month period; and (ii) the governmentconcerned has provided assurances that it will not support acts of international terrorism in thefuture.