Iran Sanctions - Foreign Press Centers

Iran Sanctions
signed in September 1997, for Total SA of France and its partners, Gazprom of Russia and
Petronas of Malaysia, to develop phases 2 and 3 of the 25+ phase South Pars gas field. The EU,
for its part, pledged to increase cooperation with the United States on nonproliferation and
counterterrorism. Then-Secretary of State Albright, in the May 18, 1998, waiver announcement,
indicated that similar future such projects by EU firms in Iran would not be sanctioned, provided
overall EU cooperation against Iranian terrorism and proliferation continued. 11 (The EU sanctions
against Iran, announced July 27, 2010, might render this understanding moot because the EU
sanctions ban EU investment in and supplies of equipment and services to Iran’s energy sector.)
Despite investments made in Iran’s energy sector, as shown in Table 4, the Administration made
no violations determinations from 1998 until September 2010.
ISA Sanctions Determinations: September 2010 to the Present 12
Prior to the passage of CISADA, several Members of Congress questioned why no penalties had
been imposed for violations of ISA. State Department reports to Congress on ISA, required every
six months, have routinely stated that U.S. diplomats raise U.S. policy concerns about Iran with
investing companies and their parent countries. However, these reports have not specifically
stated which foreign companies, if any, were being investigated for ISA violations. No
publication of such deals has been placed in the Federal Register, as required by Section 5e of
ISA. In an effort to address the congressional criticism, Under Secretary of State for Political
Affairs William Burns testified on July 9, 2008 (House Foreign Affairs Committee), that the
Statoil project (listed in Table 4) was under review for ISA sanctions. Statoil is incorporated in
Norway, which is not an EU member, and it would therefore not fall under the 1998 U.S.-EU
agreement discussed above.
Possibly in response to the pending CISADA legislation, and to an October 2009 letter signed by
50 Members of Congress referencing Table 4, Assistant Secretary of State for Near Eastern
Affairs Jeffrey Feltman testified before the House Foreign Affairs Committee on October 28,
2009, that the Obama Administration would review investments in Iran for violations of ISA.
Feltman testified that the preliminary review would be completed within 45 days (by December
11, 2009) to determine which projects, if any, require further investigation. He testified that some
announced projects were for political purposes and did not result in actual investment.
On February 25, 2010, Secretary of State Clinton testified before the House Foreign Affairs
Committee that the State Department’s preliminary review was completed in early February and
that some of the cases reviewed “deserve[] more consideration” and were undergoing additional
scrutiny. The preliminary review, according to the testimony, was conducted, in part, through
State Department officials’ contacts with their counterpart officials abroad and corporation
officials. The additional investigations of problematic investments would involve the intelligence
community, according to Secretary Clinton. State Department officials told CRS in November
2009 that they intended to complete the additional investigation and determine violations within
180 days of the completion of the preliminary review, or by early August 2010. (The 180-day
(...continued)
over the life of a project, which might in some cases be several decades.
11
Text of announcement of waiver decision by then Secretary of State Madeleine Albright, containing expectation of
similar waivers in the future. http://www.parstimes.com/law/albright_southpars.html.
12
Much of this section is derived from a meeting between the CRS author and officials of the State Department’s
Economics Bureau, which is tasked with the referenced review of investment projects. November 24, 2009.
Congressional Research Service 12