59 006
105 th Congress
Report
HOUSE OF REPRESENTATIVES
1st Session
105 375
IRAN MISSILE PROLIFERATION SANCTIONS ACT OF 1997
November 4, 1997.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
Mr. Gilman , from the Committee on International Relations, submitted
the following
REPORT
together with
ADDITIONAL VIEWS
[To accompany H.R. 2709]
[Including cost estimate of the Congressional Budget Office]
The Committee on International Relations, to whom was referred the
bill (H.R. 2709) to impose certain sanctions on foreign persons who
transfer items contributing to Iran's efforts to acquire, develop, or
produce ballistic missiles, having considered the same, report favorably
thereon with an amendment and recommend that the bill as amended do
pass.
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu thereof
the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Iran Missile Proliferation Sanctions
Act of 1997''.
SEC. 2. REPORTS ON MISSILE PROLIFERATION TO IRAN.
(a) Reports.--Except as provided in subsection (c), the President
shall, at the times specified in subsection (b), submit to the Committee
on International Relations of the House of Representatives and the
Committee on Foreign Relations of the Senate a report identifying every
foreign person with respect to whom there is credible information
indicating that that person, on or after August 8, 1995--
(1)(A) transferred items on the MTCR Annex, or items that the United
States proposes for addition to the MTCR Annex, that contributed to
Iran's efforts to acquire, develop, or produce ballistic missiles, or
(B) provided technical assistance or facilities which the President
deems to be of concern because of their direct contribution to Iran's
efforts to acquire, develop, or produce ballistic missiles; or
(2)(A) attempted to transfer items on the MTCR Annex, or items that
the United States proposes for addition to the MTCR Annex, that would
have contributed to Iran's efforts to acquire, develop, or produce
ballistic missiles, or
(B) attempted to provide technical assistance or facilities which
the President deems to be of concern because of their direct
contribution to Iran's efforts to acquire, develop, or produce ballistic
missiles.
(b) Timing of Reports.--The reports under subsection (a) shall be
submitted not later than 30 days after the date of the enactment of this
Act, not later than 180 days after such date of enactment, not later
than 1 year after such date of enactment, and not later than the end of
each 1-year period thereafter.
(c) Exceptions for Persons Previously Identified, Sanctioned, or
Subject of Waiver.--Any foreign person who--
(1) was identified in a previous report submitted under subsection
(a) on account of a particular transfer, transaction, or attempt,
(2) has engaged in a transfer or transaction that was the basis for
the imposition of sanctions with respect to that person under section 73
of the Arms Export Control Act or section 1604 of the Iran-Iraq Arms
Non-Proliferation Act of 1992, or
(3) may have engaged in a transfer or transaction, or made an
attempt, that was the subject of a waiver under section 4,
is not required to be identified on account of that same transfer,
transaction, or attempt in any report submitted thereafter under this
section.
SEC. 3. IMPOSITION OF SANCTIONS.
(a) Requirement To Impose Sanctions.--
(1) Requirement to impose sanctions.--The sanctions described in
subsection (b) shall be imposed on--
(A) any foreign person identified under subsection (a)(1) of section
2 in a report submitted under that section, and
(B) any foreign person identified under subsection (a)(2) of section
2 in a report submitted under that section, if that person has been
identified in that report or a previous report as having made at least 1
other attempt described in subsection (a)(2) of that section.
(2) Effective date of sanctions.--The sanctions shall be effective--
(A) 30 days after the report triggering the sanction is submitted,
if the report is submitted on or before the date required by section
2(b);
(B) 30 days after the date required by section 2(b) for submitting
the report, if the report triggering the sanction is submitted within 30
days after that date; and
(C) on the date that the report triggering the sanction is
submitted, if that report is submitted more than 30 days after the date
required by section 2(b).
(b) Description of Sanctions.--The sanctions referred to in
subsection (a) that are to be imposed on a foreign person described in
that subsection are the following:
(1) Arms export sanction.--For a period of not less than 2 years,
the United States Government shall not sell to that person any item on
the United States Munitions List as in effect on August 8, 1995, and
shall terminate sales to that person of any defense articles, defense
services, or design and construction services under the Arms Export
Control Act.
(2) Dual use sanction.--For a period of not less than 2 years, the
authorities of section 6 of the Export Administration Act of 1979 shall
be used to prohibit the export to that person of any goods or technology
on the control list established under section 5(c)(1) of that Act.
(3) United states assistance.--For a period of not less than 2
years, the United States Government shall not provide any assistance in
the form of grants, loans, credits, guarantees, or otherwise, to that
person.
SEC. 4. WAIVER ON BASIS OF ADDITIONAL INFORMATION.
(a) In General.--The President may waive the imposition of any
sanction that would otherwise be required under section 3 on any foreign
person 15 days after the President determines and reports to the
Committee on International Relations of the House of Representatives and
the Committee on Foreign Relations of the Senate that, on the basis of
information provided by that person, or otherwise obtained by the
President, the President is persuaded that the person did not, on or
after August 8, 1995--
(1)(A) transfer items on the MTCR Annex, or items that the United
States proposes for addition to the MTCR Annex, that contributed to
Iran's efforts to acquire, develop, or produce ballistic missiles, or
(B) provide technical assistance or facilities which the President
deems to be of concern because of their direct contribution to Iran's
efforts to acquire, develop, or produce ballistic missiles; or
(2) attempt on more than one occasion--
(A) to transfer items on the MTCR Annex, or items that the United
States proposes for addition to the MTCR Annex, that would have
contributed to Iran's efforts to acquire, develop, or produce ballistic
missiles, or
(B) to provide technical assistance or facilities described in
paragraph (1)(B).
(b) Written Justification.--The determination and report of the
President under subsection (a) shall include a written justification
describing in detail--
(1) the credible information indicating that the person--
(A) transferred items described in section 2(a)(1)(A), or provided
technical assistance or facilities described in section 2(a)(1)(B); or
(B) attempted to transfer items described in section 2(a)(1)(A), or
attempted to provide technical assistance or facilities described in
section 2(a)(1)(B);
(2) the additional information which persuaded the President that
the person did not--
(A) transfer items described in section 2(a)(1)(A), or provide
technical assistance or facilities described in section 2(a)(1)(B); or
(B) attempt to transfer items described in section 2(a)(1)(A), or
attempt to provide technical assistance or facilities described in
section 2(a)(1)(B); and
(3) the analysis of the information supporting the President's
conclusion.
(c) Submission in Classified Form.--When the President considers it
appropriate, the determination and report of the President under
subsection (a) and the written justification under subsection (b), or
appropriate parts thereof, may be submitted in classified form.
SEC. 5. WAIVER ON BASIS OF NATIONAL SECURITY.
(a) In General.--The President may waive the imposition of any
sanction that would otherwise be required under section 3 on any foreign
person 15 days after the President determines and reports to the
Committee on International Relations of the House of Representatives and
the Committee on Foreign Relations of the Senate that such waiver is
essential to the national security of the United States.
(b) Written Justification.--The determination and report of the
President under subsection (a) shall include a written justification
describing in detail the facts and circumstances supporting the
President's conclusion.
(c) Submission in Classified Form.--When the President considers it
appropriate, the written justification under subsection (b), or
appropriate parts thereof, may be submitted in classified form.
SEC. 6. ADDITIONAL INFORMATION REGARDING ACTIONS BY GOVERNMENT
OF PRIMARY JURISDICTION.
As part of each report submitted under section 2, the President shall
include the following information with respect to each foreign person
identified in that report:
(1) A statement regarding whether the government of primary
jurisdiction over that person was aware of the activities that were the
basis for the identification of that person in the report.
(2) If the government of primary jurisdiction was not aware of the
activities that were the basis for the identification of that person in
the report, an explanation of the reasons why the United States
Government did not inform that government of those activities.
(3) If the government of primary jurisdiction was aware of the
activities that were the basis for the identification of that person in
the report, a description of the efforts, if any, undertaken by that
government to prevent those activities, and an assessment of the
effectiveness of those efforts, including an explanation of why those
efforts failed.
(4) If the government of primary jurisdiction was aware of the
activities that were the basis for the identification of that person in
the report and failed to undertake effective efforts to prevent those
activities, a description of any sanctions that have been imposed on
that government by the United States Government because of such failure.
SEC. 7. PURCHASE OF WEAPONS TECHNOLOGY.
(a) Sense of the Congress.--It is the sense of the Congress that the
President should exercise the authority granted to him under section 504
of the Freedom for Russia and Emerging Eurasian Democracies and Open
Markets Support Act of 1992 (22 U.S.C. 5854)--
(1) to prevent the transfer of weapons-related material and delivery
systems to Iran through the purchase, barter, or other acquisition of
such material and delivery systems; and
(2) to prevent the transfer to Iran of scientific and technical
expertise with respect to such weapons-related material and delivery
systems.
(b) Availability of Amounts.--Amounts hereafter made available to
carry out chapter 11 of part I of the Foreign Assistance Act of 1961 (22
U.S.C. 2295 et seq.; relating to assistance for the independent states
of the former Soviet Union) may be used to carry out subsection (a).
SEC. 8. DEFINITIONS.
For the purposes of this Act--
(1) the terms ``foreign person'' and ``person'' mean--
(A) a natural person that is an alien;
(B) a corporation, business association, partnership, society,
trust, or any other nongovernmental entity, organization, or group, that
is organized under the laws of a foreign country or has its principal
place of business in a foreign country;
(C) any foreign governmental entity operating as a business
enterprise; and
(D) any successor or subsidiary of any entity described in
subparagraph (B) or (C);
(2) the term ``government of primary jurisdiction'' means--
(A) in the case of a natural person, the foreign government of the
country of which the person is a citizen or national;
(B) in the case of an entity described in subparagraph (B) of
paragraph (1), the foreign government of the country in which the entity
has its principal place of business, or the foreign government under
whose laws that entity is organized; and
(C) in the case of a foreign governmental entity described in
subparagraph (C) of paragraph (1), the foreign government of which that
entity is a part; and
(3) the term ``MTCR Annex'' has the meaning given that term in
section 11B(c)(4) of the Export Administration Act of 1979 (50 U.S.C.
2410b(c)(4)).
Background and Purpose
H.R. 2709, the Iran Missile Proliferation Sanctions Act of 1997, is
intended to provide additional leverage to the Administration to address
ongoing assistance by Russian institutes, research facilities, and other
business entities for Iran's medium and long range missile program by
closing loopholes in existing sanctions laws that have been used in the
past to avoid sanctioning firms that have transferred missile goods or
technology to Iran.
The Committee believes that one of our most important national
security objectives in the area of non-proliferation is to prevent Iran
from obtaining and in some instances, from improving, its weapons of
mass destruction capabilities. Most critical, in the short-term, is the
prospect of Iran enhancing its ballistic missile capability. Iranian
acquisition of ballistic missiles with a range of 1,300 kilometers or
more poses an unacceptable threat to American forces in the Middle East
as well as to our allies throughout the Persian Gulf region.
The Committee notes that Russian entities have already provided Iran
with missile components and critical know-how and technological support.
The question facing the Administration and the Congress is whether we
can halt further assistance. Time is short and the U.S. has but a few
months to prevent Iran from achieving a significant advance in its
missile program.
The Committee notes that, according to open sources, early this year
U.S. and Israeli intelligence reports revealed a technology transfer
between Russia and Iran involving construction of a delivery system for
the Russian SS 4 and Iranian Shahab-3 and Shahab-4 long-range missiles.
Successive reports detailed contracts signed between numerous Russian
entities and Iran's Defense Industries Organization (DIO) to help
produce liquid-fueled ballistic missiles, a wind tunnel for missile
development and related technologies.
The Committee notes, again according to open sources, the following
entities have been involved in missile technology transfers to Iran:
Defense Industries Organization (DIO), an Iranian agency charged
with development, production and procurement of military technology;
Shahid Hemmat Industrial Group (SHIG), part of the DIO responsible
for development and production of ballistic missiles and related
technology;
Inor, a Russian scientific and production center implicated in
transfer to SHIG of materials used in missile construction;
Russian Central Aerohydrodynamic Institute, implicated in
collaboration with SHIG on wind tunnel construction;
Russian State Corporation for Export and Import on Armament and
Military Equipment (Rosvoorouzhenie);
Bauman Institute, a leading Russian scientific research center;
NPO Trud, a Russian rocket motor manufacturer;
Polyus, a leading Russian developer of laser technology; and
Russian Space Agency, headed by Yuri Koptev.
The Committee believes that an incremental approach to this issue or
reliance on friendly persuasion does not appear to be achieving any
demonstrable results. Dialogue cannot substitute for more forceful and
immediate action, including the imposition of sanctions on those
entities engaging in missile cooperation with Iran.
At present, the Administration appears unable or unwilling to
sanction the Russian entities that are providing essential missile
components and technical assistance to extend the range of Iran's Scud
missiles to 1,300 kilometers.
The Committee fully supports the ongoing discussions between the U.S.
and the Russian government and believes we must continue talking at the
highest levels to put an immediate end to this assistance. However, we
see no meaningful prospects for enforcement action by the Russian
government at the local and regional level that would turn
non-proliferation rhetoric into reality.
With Russia's cash-strapped technical institutes and research
facilities eager to sell to Iranian weapons purchasers, Russia's
effective adherence to the obligations of the Missile Technology Control
Regime (MTCR) is open to serious question. In testimony before the full
Committee in early October, a State Department official all but
acknowledged that there is little likelihood the Administration will
impose sanctions on these entities before the Iranian missile program
becomes fully operational.
It is clear that the Congress has a fundamental disagreement with the
Administration over the utility of sanctions legislation. The Committee
makes two points in that regard:
First, with respect to concerns about the Congress imposing
unilateral sanctions, the Committee notes that the Congress will not
hesitate to take such action when an Administration's policy is
demonstrably ineffective in protecting America's vital interests.
Furthermore, the imposition of these sanctions would be used to bring
Russia, a member of the Missile Technology Control Regime (MTCR), back
into conformity with its norms and standards.
Second, the Committee believes that the Administration will continue
to see legislation of this type until it can make a credible case to the
Congress that current non-proliferation sanctions laws are being
implemented vigorously.
In short, the Committee is not satisfied that the Administration has
made it absolutely clear to Russia that halting missile cooperation with
Iran is vital to our interests and that U.S. assistance, particularly in
the area of space cooperation, may be jeopardized if such cooperation
does not end immediately.
The bill requires the President to submit a report to Congress 30
days after the date of enactment, and periodically thereafter,
identifying those entities where there is credible evidence they have
transferred key missile components or technology to Iran. Thirty days
after this report is required to be submitted, three sanctions (denying
munitions licenses, dual use licenses and U.S. foreign assistance to
these entities) would be imposed for a period of at least two years on
the entities identified in the report.
It gives the Administration ample flexibility in the final
determination to impose these sanctions but it closes the loopholes in
existing sanctions laws that have been used to avoid sanctioning firms
that have transferred key missile components to Iran.
In the 1980s the world stood by as Saddam Hussein built up his
arsenal of weapons of mass destruction that we have yet to fully
identify and destroy. The Committee strongly believes that the U.S.
cannot afford to do the same with Iran as it uses its petrodollars to
purchase weapons systems that will threaten its neighbors and endanger
our forces throughout the Persian Gulf Region.
COMMITTEE ACTION
On September 25, 1997, the full Committee held a closed briefing with
Dr. Gordon Oehler, Director of the Non-Proliferation Center at the
Central Intelligence Agency. On October 23, 1997, the full Committee
held a second closed briefing with Ambassador Frank Wisner, Special
Presidential Envoy, Department of State, Mr. John McLaughlin, Deputy
Director for Intelligence, Central Intelligence Agency, and other
officials.
On October 9, 1997, the full Committee marked up related legislation,
H. Con. Res. 121, a concurrent resolution expressing the sense of the
Congress regarding proliferation of missile technology from Russia to
Iran. During the full Committee debate on the measure, testimony was
taken from Congresswoman Jane Harman, the sponsor of the resolution, and
several State Department witnesses including Mr. Michael Klosson, a
Deputy Assistant Secretary of State for Legislative Affairs, Mr. James
P. Timbie, Senior Advisor to the Under Secretary of State for Arms
Control and International Security Affairs, and Ms. Robin Frank, Legal
Affairs, Department of State.
After concluding consideration of the resolution, the Committee
adopted the resolution and agreed to a motion to consider the resolution
under suspension of the rules by voice vote, a quorum being present.
On October 24, 1997, the full Committee marked up H.R. 2709. During
the full Committee debate, testimony was taken from two State Department
officials, Mr. Michael Klosson, a Deputy Assistant Secretary of State
for Legislative Affairs, and Mr. Robert J. Einhorn, a Deputy Assistant
Secretary of State for Politico-Military Affairs.
The full Committee considered the bill as original text for the
purpose of amendment and took the following preliminary action, all by
voice vote: Adopting the Ackerman amendment, expressing the sense of the
Congress that the President should use the authority of section 504 of
the FREEDOM Act and authorizing funds made available under that Act for
such purpose. Adopting the Berman amendment, limiting goods and
technology or technical assistance and facilities transferred to Iran's
ballistic missile program to those items on the Missile Technology
Control Regime (MTCR) Annex.
After concluding consideration of the bill, the full Committee
ordered the bill reported to the House by voice vote, a quorum being
present.
ROLLCALL VOTES
Clause 2(l)(2)(B) of rule XI of the Rules of the House of
Representatives requires the Committee to list the recorded votes on the
motion to report legislation and amendments thereto. No roll-call votes
were held on the motion to report the legislation or on amendments to
the legislation.
COMMITTEE OVERSIGHT FINDINGS
In compliance with clause 2(l)(3)(A) of rule XI of the Rules of the
House of Representatives, the Committee reports 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.
Committee on Government Reform and Oversight Findings
No findings or recommendations of the Committee on Government Reform
and Oversight were received as referred to in clause 2(l)(3)(D) of rule
XI of the Rules of the House of Representatives.
New Budget Authority and Tax Expenditures
The Committee adopts the cost estimate of the Congressional Budget
Office, set out below, as its submission of any required information on
new budget authority, new spending authority, new credit authority, or
an increase or decrease in the national debt required by clause
2(l)(3)(B) of rule XI of the Rules of the House of Representatives.
FEDERAL MANDATES STATEMENT
The Committee adopts as its own the estimate of Federal mandates
prepared by the Director of the Congressional Budget Office pursuant to
section 423 of the Unfunded Mandates Reform Act.
ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b) of the
Federal Advisory Committee Act were created by this legislation.
APPLICABILITY TO THE LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to the terms
and conditions of employment or access to public services or
accommodations within the meaning of section 102(b)(3) of the
Congressional Accountability Act.
CONSTITUTIONAL AUTHORITY STATEMENT
In compliance with clause 2(l)(4) of rule XI of the Rules of the
House of Representatives, the Committee cites the following specific
powers granted to the Congress in the Constitution as authority for
enactment of H.R. 2709 as reported by the Committee: Article I, section
8, clause 3 (relating to the regulation of commerce with foreign nations
and among the several states); and Article I, section 8, clause 18
(relating to making all laws necessary and proper for carrying into
execution powers vested by the Constitution in the government of the
United States).
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
In compliance with clause 2(l)(3)(C) of rule XI of the Rules of the
House of Representatives, the Committee sets forth with respect to H.R.
2709 as reported by the Committee the following estimate and comparison
prepared by the Director of the Congressional Budget Office under
section 403 of the Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, November 4, 1997.
Hon. Benjamin A. Gilman,
Chairman, Committee on International Relations,
U.S. House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has prepared the
enclosed cost estimate for H.R. 2709, the Iran Missile Proliferation
Sanctions Act of 1997.
If you wish further details on this estimate, we will be pleased to
provide them. The CBO staff contact is Joseph C. Whitehill.
Sincerely,
June E. O'Neill, Director.
Enclosure.
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
H.R. 2709--Iran Missile Proliferation Sanctions Act of 1997
H.R. 2709 would require the President to report to the Congress and
to impose sanctions upon foreign persons who have contributed to Iran's
efforts to acquire, develop, or produce ballistic missiles. Persons
identified in the report would be ineligible for export licenses for
arms or controlled goods and technology, and for foreign aid. In
addition, section 7 of the bill would authorize the use of appropriated
funds to acquire weapons-related material, delivery systems, or
technology to prevent their transfer to Iran.
Based on information from the Department of State (DOS), CBO
estimates that the additional reporting requirements would cost less
than $500,000 annually, assuming appropriation of the necessary funds.
CBO estimates that section 7 of the bill would have no budgetary impact
because current law already allows DOS to take the measures authorized
by that section and enactment of H.R. 2709 would not increase spending
on such activities. Because the bill would not affect direct spending or
receipts, pay-as-you-go procedures would not apply.
The Unfunded Mandates Reform Act of 1995 (UMRA) excludes from
application of that act legislative provisions that are necessary for
the national security. CBO has determined that the provisions of H.R.
2709 either fit within this exclusion or do not contain private-sector
or intergovernmental mandates as defined by UMRA.
The estimate was prepared by Joseph C. Whitehill. The estimate was
approved by Robert A. Sunshine, Deputy Assistant Director for Budget
Analysis.
SECTION-BY-SECTION ANALYSIS
SECTION 1. SHORT TITLE
Provides that the Act may be cited as the ``Iran Missile
Proliferation Sanctions Act of 1997''.
SECTION 2. REPORTS ON MISSILE PROLIFERATION TO IRAN
Requires the President to submit periodic reports on missile
proliferation to Iran to the Committee on International Relations of the
House of Representatives and the Committee on Foreign Relations of the
Senate. Such reports are required to be submitted not later than 30 days
after the date of enactment, not later than 180 days after the date of
enactment, not later that one year after the date of enactment, and not
later than the end of each one-year period thereafter.
Each such report must identify every foreign person with respect to
whom there is credible information that that person, on or after August
8, 1995--
(1) transferred items on the MTCR Annex, or items that the United
States proposes for addition to the MTCR Annex, that contributed to
Iran's efforts to acquire, develop or produce ballistic missiles;
(2) provided technical assistance or facilities which the President
deems to be of concern to the United States because of their direct
contribution to Iran's efforts to acquire, develop or produce ballistic
missiles;
(3) attempted to transfer items on the MTCR Annex, or items that the
United States proposes for addition to the MTCR Annex, that would have
contributed to Iran's efforts to acquire, develop or produce ballistic
missiles; or
(4) attempted to provide technical assistance or facilities which
the President deems to be of concern to the United States because of
their direct contribution to Iran's efforts to acquire, develop or
produce ballistic missiles.
The Committee included technical assistance or facilities that the
President ``deems to be of concern to the United States'' in order to
make clear that range of transfers or attempted transfers subject to
this legislation is not limited to technical assistance, facilities, and
other items listed on the MTCR Annex.
The only foreign persons otherwise required to be identified in a
report under this section
who need not be so identified are any foreign persons who--
(1) were identified in a previous report submitted under this section;
(2) were sanctioned previously under section 73 of the Arms Export
Control Act or section 1604 of the Iran-Iraq Arms Non-Proliferation Act
of 1992; or
(3) were not necessarily identified in a previous report submitted
under this section but were the subject of a waiver on the basis of
additional information exercised pursuant to section 4 of this Act.
The exception to the requirement to identify foreign persons
otherwise required to be identified under this section extends only to
the same transfer, transaction, or attempt that gave rise to the
exception. Credible information regarding any additional transfer,
transaction, or attempt by that same foreign person gives rise to a new
and separate requirement to identify that foreign person in a report
under this section, which is overcome only if that additional transfer,
transaction, or attempt falls into one of the exceptions categories.
The ``credible information'' requirement of this section is intended
to be a very low evidentiary standard. For purposes of this Act,
``credible information'' is information that is sufficiently believable
as to raise a serious question in the mind of a reasonable person as to
whether a foreign person may have transferred or attempted to transfer
missile goods, technology, technical assistance, or facilities of the
type described in subsection (a) of this section. ``Credible
information'' is information that, by itself, may not be sufficient to
permit a reasonable person to conclude with confidence that a foreign
person has transferred or attempted to transfer missile goods,
technology, technical assistance, or facilities subject to this Act.
The Committee adopts this very low evidentiary standard because of
its dissatisfaction with the way the evidentiary standard contained in
other counter-proliferation laws has been applied. These laws, including
the missile technology proliferation sanctions of section 73 of the Arms
Export Control Act and the Iran-Iraq Arms Non-Proliferation Act,
essentially contain a ``preponderance of the evidence'' standard. Under
these laws, sanctions for proscribed transfers need not be imposed until
the President determines that such a transfer in fact occurred. In
practice, however, the Executive branch generally has delayed imposing
sanctions until all doubt about whether a transfer occurred has been
erased. In effect, the Executive branch has elevated the evidentiary
standard of these laws to a requirement of ``proof beyond a reasonable
doubt.'' The Committee believes that this practice has undermined the
effectiveness of our non-proliferation laws by blunting their intended
deterrent effect. Accordingly, in order to ensure the effectiveness of
this Act, the Committee has adopted a lower evidentiary standard.
Section 3. Imposition of Sanctions
Sanctions are required to be imposed on any foreign person who has
been identified in a report under section 2 as having--
(1) transferred items on the MTCR Annex, or items that the United
States proposes for addition to the MTCR Annex, that contributed to
Iran's efforts to acquire, develop or produce ballistic missiles; or
(2) provided technical assistance or facilities which the President
deems to be of concern to the United States because of their direct
contribution to Iran's efforts to acquire, develop or produce ballistic
missiles.
In addition, sanctions are required to be imposed on any foreign
person who, on the basis of information contained in one or more reports
under section 2, has been identified as having on more than one
occasion--
(1) attempted to transfer items on the MTCR Annex, or items that the
United States proposes for addition to the MTCR Annex, that would have
contributed to Iran's efforts to acquire, develop or produce ballistic
missiles; or
(2) attempted to provide technical assistance or facilities which
the President deems to be of concern to the United States because of
their direct contribution to Iran's efforts to acquire, develop or
produce ballistic missiles.
Three sanctions must be imposed for a period of not less than two
years on any foreign person required to be sanctioned under this Act.
These sanctions are to take effect 30 days after the report identifying
the foreign person was submitted or required to be submitted. The
sanctions are--
(1) prohibition of sales to that foreign person of items on the
United States Munitions List as in effect on August 8, 1995, and
termination of sales of defense articles, defense services, and design
and construction services under the Arms Export Control Act;
(2) prohibition of exports to that foreign person of dual use items
listed on the control list established under section 5(c)(1) of the
Export Administration Act of 1979; and
(3) prohibition on the provision to that foreign person of United
States assistance in the form of grants, loans, credits, guarantees, or
otherwise.
Section 4. Waiver on Basis of Additional Information
The President may waive the imposition of any sanction otherwise
required to be imposed under section 3 if, on the basis of additional
information provided by the foreign person in question or otherwise
available to the President, the President determines and reports that he
is persuaded that the foreign person did not carry out the act that
would be the basis for imposition of sanctions pursuant to section 3.
The President's determination and report must be submitted to the
Committee on International Relations of the House of Representatives and
the Committee on Foreign Relations of the Senate at least 15 days before
the waiver takes effect. The determination and report must
be accompanied by a written justification describing in
detail, among other matters, the credible information that otherwise
would give rise to the requirement to impose sanctions, the additional
information which persuaded the President that the credible information
was misleading or incorrect, and the President's analysis of the
information. The President's determination, report, and written
justification may, to the extent considered appropriate by the
President, be submitted in classified form.
The President is not required to wait until after a foreign person
has been identified in a periodic report pursuant to section 2 before
exercising the waiver provided by this section. This fact, along with
the President's ability to exercise the waiver in classified form and
the provision of section 2 exempting foreign persons subject to a waiver
under this section from the requirement that they be identified in a
report under that section, means that the President need not apply
sections 2 and 3 with respect to foreign persons that he finds to be
innocent of wrongdoing.
It is the Committee's expectation that the President will utilize
these provisions of the Act to develop a process for judging the guilt
or innocence of foreign persons about whom there emerges credible
information suggesting that they may have transferred or attempted to
transfer missile goods, technology, technical assistance, or facilities
subject to the Act. This process should begin as soon as credible
information suggesting that there may have been such a transfer or
attempted transfer is obtained. As part of this process, the Executive
branch should seek to obtain additional information from all sources.
The President will then evaluate all relevant information and decide
whether the evidence taken as a whole supports a determination by the
President that no transfer or attempted transfer occurred. Only if the
President is unable to conclude by a preponderance of the evidence that
no transfer or attempted transfer occurred will sanctions actually be
imposed.
Section 5. Waiver on Basis of National Security
The President may waive the imposition of any sanction otherwise
required to be imposed under section 3 if the President determines and
reports that such waiver is essential to the national security of the
United States.
The President's determination and report must be submitted to the
Committee on International Relations of the House of Representatives and
the Committee on Foreign Relations of the Senate at least 15 days before
the waiver takes effect. The determination and report must be
accompanied by a written justification describing in detail the facts
and circumstances supporting the President's conclusion. The written
justification accompanying the determination and report may, to the
extent considered appropriate by the President, be submitted in
classified form.
The Committee anticipates that, in virtually every case in which the
waiver provided by this section is exercised, the national security
justification for the waiver will be related to the Act's objective of
preventing the proliferation of missile technology to Iran. Thus, in a
typical case, the President might report that he has obtained reliable
and credible assurances that the foreign person in question will refrain
from future missile transfers to Iran, but only if the sanctions
otherwise required to be imposed by this Act are suspended or not
imposed.
Section 6. Additional Information Regarding Actions by Government of
Primary Jurisdiction
As part of each report submitted under section 2, the President is
required to provide additional information with respect to each foreign
person identified in that report. This additional information relates to
the knowledge and actions, or lack thereof, of the government of primary
jurisdiction over that foreign person with respect to the activities
that were the basis for the identification of that foreign person in the
report. If the government of primary jurisdiction had knowledge of the
activities and failed to undertake effective efforts to prevent them,
the President is required to describe the sanctions that have been
imposed on that government by the United States because of such failure.
Section 7. Purchase of Weapons Technology
Expresses the sense of Congress that the President should use his
authority under section 504 of the Freedom for Russia and Emerging
Eurasian Democracies and Open Markets Support Act of 1992 to prevent the
transfer to Iran of weapons-related material, delivery systems, and
related scientific and technical expertise through purchase, barter, or
other acquisition of such items. Amounts hereafter made available to
carry out chapter 11 of the Foreign Assistance Act of 1961 may be used
to carry out this section.
Section 8. Definitions
Provides definitions of the terms ``foreign person'', ``person'',
``government of primary jurisdiction'', and ``MTCR Annex'' for purposes
of this Act.
ADDITIONAL VIEWS ON H.R. 2709, THE IRAN MISSILE PROLIFERATION SANCTIONS
ACT OF 1997
The Chairman of the Committee deserves commendation for his efforts
to focus attention on the issue of missile technology transfers to Iran.
This issue is of grave importance to peace and stability in the Middle
East, the security of key U.S. partners and allies--including Israel and
Turkey--and the security of U.S. forces stationed in the Gulf region.
We believe that Congress and the Executive branch share the same
policy goal: to stop the transfer of missile technology to Iran. The
question before us is the most effective way to achieve that shared
goal.
It is our belief that achievement of this goal requires the President
to initiate a high-level diplomatic effort with those countries that
provide missile technology to Iran. The role of Congress should be to
strengthen the President's hand in his negotiations with Russia, or any
other government, to stop such transfers. Legislation can play a helpful
role in support of diplomacy, but such legislation needs to be shaped
through careful consultation with the Executive branch.
Missile technology transfers to Iran have become a contentious issue
between the Committee and the Executive branch, in part because the
consultation process has been weak. The Committee has had difficulty in
getting detailed, timely information from the Executive branch on this
issue. The Committee requested in early September an opportunity to meet
with Ambassador Wisner, the President's envoy who is conducting
negotiations with Russia on this topic. The Committee benefited greatly
from its meeting with Ambassador Wisner, but he was not available until
the day before the Committee's mark-up of H.R. 2709.
Members of the Committee also seek to meet with the Vice President on
this issue. Because of his involvement in the Gore-Chernomyrdin
Commission, the vice President is the senior official most knowledgeable
about the question of U.S. policy on Russian missile transfers to Iran.
We believe that many of the Committee members' questions--particularly
with regard to how high a priority the United States attaches to a
resolution of this issue--can be best addressed by the Vice President,
and we look forward to the earliest possible meeting with him. We
believe that, through the involvement of the vice President, many of the
problem areas identified by the Executive branch with H.R. 2709 can be
addressed.
In her letter of October 24, 1997 to the Ranking Democratic Member,
the Secretary of State commented on a draft of the Iran Missile
Proliferation Act of 1997 as follows: ``If presented to the President in
its current form, the Secretary of State and the President's National
Security Advisor would recommend that he veto this bill.''
CHANGES TO THE BILL
Prior to and during mark-up, a number of improvements in H.R. 2709
took place:
We commend the Chairman for adding a waiver to sanctions that would
be imposed by this bill. That waiver allows the President to waive
sanctions if he determines and reports to Congress that such waiver is
``essential to the national security of the United States.''
The Committee adopted Mr. Berman's excellent amendment, limiting the
scope of sanctioned activities to those involving the transfer or
attempted transfer of Missile Technology Control Regime (MTCR) annex
items or related items; or technical assistance or facilities that
contribute directly to Iran's missile programs;
The Committee adopted Mr. Ackerman's excellent amendment, expressing
the sense of Congress that the President should exercise existing
authorities and available funds to prevent the transfer of
weapons-related material and delivery systems to Iran through the
purchase, barter or other acquisition of such material and delivery
systems. In relative terms, because the amount of funds involved in
Iran's purchases of missile technology are not large, Mr. Ackerman and
other members of the Committee expressed the view that an approach other
than sanctions may be a more useful way to achieve U.S. policy goals.
PROBLEMS REMAIN
Still, it is clear that several problems with H.R. 2709 remain:
The bill establishes too low a threshold for the imposition of
sanctions. The bill allows little flexibility for the Executive to
exercise judgment in evaluating the vast amount of information it
receives about missile transfers to Iran. It is required to report, and
impose sanctions, based on ``credible information'' about transfers or
attempted transfers of goods or technology that contribute to Iran's
missile program. Credible information is not a defined term, and is
subject to the broadest interpretation. One report, or one phone call,
could initiate a requirement to report and impose sanctions.
The bill does not allow enough time between the requirement to
report and the requirement to sanction. Sanctions would have to be
imposed no later than 30 days after the date of the required report. In
many cases, sanctions could be imposed erroneously, needlessly damaging
U.S. credibility with other governments in our efforts to prevent Iran
from obtaining missile technology.
The bill has no requirement that actions subject to sanction be
taken ``knowingly.'' Sanctions would be imposed on entities unaware that
items are going to Iran or will be used in missiles. Such a provision is
fundamentally unfair and will undermine U.S. credibility and the
willingness of foreign entities to cooperate with the United States.
The bill's waiver provision, while a step forward, could be improved
further.
The bill retroactive in its application.
The bill applies sanctions on the U.S. subsidiaries of foreign firms
that are sanctioned.
The bill's reporting requirements, even if interpreted not to
require the public release of sensitive information, could dissuade
foreign governments or persons from cooperating with the United States
to prevent Iran from obtaining missile technology.
Not each of us agree with every problem in the list as outlined
above. But each of us believe that the bill needs substantial
improvement.
Even at this late date, we do not have a full understanding of the
bill's impact if it were enacted into law. For this reason, we believe
that further consultation with the Executive branch is necessary.
Through such consultation, and through further work by the Committee,
we believe that this bill can be improved so that it will strengthen,
not undermine, the President's ability to achieve the goals all of us
share--to stop Iran's missile program.
Lee H. Hamilton.
Sam Gejdenson.
Bob Clement.
Tom Lantos.
Gary L. Ackerman.
Eni F.H. Faleomavaega.
Pat Danner.
Howard L. Berman.
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