Monday, February 13, 1995

 

ISSN: 0511-4187; Volume v31; Issue n6

 

Message to the Congress on Iraq: February 8, 1995. (Bill Clinton) (Transcript)

Total number of pages for this article: 4 FULL TEXT

 

 

� To the Congress of the United States:

 

 

� I hereby report to the Congress on the developments since my last

report of August 2, 1994, concerning the national emergency with respect

to Iraq that was declared in Executive Order No. 12722 of August 2,

1990. This report is submitted pursuant to section 401(c) of the

National Emergencies Act, 50 U.S.C. 1641(c), and section 204(c) of the

International Emergency Economic Powers Act, 50 U.S.C. 1703(c).

 

 

� Executive Order No. 12722 ordered the immediate blocking of all

property and interests in property of the Government of Iraq (including

the Central Bank of Iraq), then or thereafter located in the United

States or within the possession or control of a United States person.

That order also prohibited the importation into the United States of

goods and services of Iraqi origin, as well as the exportation of goods,

services, and technology from the United States to Iraq. The order

prohibited travel-related transactions to or from Iraq and the

performance of any contract in support of any industrial, commercial, or

governmental project in Iraq. United States persons were also prohibited

from granting or extending credit or loans to the Government of Iraq.

 

 

� The foregoing prohibitions (as well as the blocking of Government of

Iraq property) were continued and augmented on August 9, 1990, by

Executive Order No. 12724,which was issued in order to align the

sanctions imposed by the United States with United Nations Security

Council Resolution 661 of August 6, 1990.

 

 

� Executive Order No. 12817 was issued on October 21, 1992, to implement

in the United States measures adopted in United Nations Security Council

Resolution 778 of October 2, 1992. Resolution No. 778 requires U.N.

Member States temporarily to transfer to a U.N. escrow account up to

$200 million apiece in Iraqi oil sale proceeds paid by purchasers after

the imposition of U.N. sanctions on Iraq, to finance Iraqi's obligations

for U.N. activities with respect to Iraq, such as expenses to verify

Iraqi weapons destruction, and to provide humanitarian assistance in

Iraq on a nonpartisan basis. A portion of the escrowed funds will also

fund the activities of the U.N. Compensation Commission in Geneva, which

will handle claims from victims of the Iraqi invasion of Kuwait. Member

States also may make voluntary contributions to the account. The funds

placed in the escrow account are to be returned, with interest, to the

Member States that transferred them to the United Nations, as funds are

received from future sales of Iraqi oil authorized by the U.N. Security

Council. No Member State is required to fund more than half of the total

transfers or contributions to the escrow account.

 

 

� This report discusses only matters concerning the national emergency

with respect to Iraq that was declared in Executive Order No. 12722 and

matters relating to Executive Orders Nos. 12724 and 12817 (the

"Executive orders"). The report covers events from August 2, 1994,

through February 1, 1995.

 

 

� 1. There has been one action affecting the Iraqi Sanctions

Regulations, 31 C.F.R. Part 575 (the "Regulations"), administered by the

Office of Foreign Assets Control (FAC) of the Department of the

Treasury, since my last report on August 2, 1994. On February 1, 1995

(60 Fed. Reg. 6376), FAC amended the Regulations by adding to the list

of Specially Designated Nationals (SDNs) of Iraq set forth in Appendices

A ("entities and individuals") and B ("merchant vessels"), the names of

24 cabinet ministers and 6 other senior officials of the Iraqi

government, as well as 4 Iraqi state-owned banks, not previously

identified as SDNs. Also added to the Appendices were the names of 15

entities, 11 individuals, and 1 vessel that were newly identified as

Iraqi SDNs in the comprehensive list of SDNs for all sanctions programs

administered by FAC that was published in the Federal Register (59 Fed.

Reg. 59460) on November 17, 1994. In the same document, FAC also

provided additional addresses and aliases for 6 previously identified

Iraqi SDNs. This Federal Register publication brings the total number of

listed Iraqi SDNs to 66 entities, 82 individuals, and 161 vessels.

 

 

� Pursuant to section 575.306 of the Regulations, FAC has determined

that these entities and individuals designated as SDNs are owned or

controlled by, or are acting or purporting to act directly or indirectly

on behalf of, the Government of Iraq, or are agencies, instrumentalities

or entities of that government. By virtue of this determination, all

property and interests in property of these entities or persons that are

in the United States or in the possession or control of United States

persons are blocked. Further, United States persons are prohibited from

engaging in transactions with these individuals or entities unless the

transactions are licensed by FAC. The designations were made in

consultation with the Department of State. A copy of the amendment is

attached to this report.

 

 

� 2. Investigations of possible violations of the Iraqi sanctions

continue to be pursued and appropriate enforcement actions taken. The

FAG continues its involvement in lawsuits, seeking to prevent the

unauthorized transfer of blocked Iraqi assets. There are currently 38

enforcement actions pending, including nine cases referred by FAC to the

U.S. Customs Service for joint investigation. Additional FAC civil

penalty notices were prepared during the reporting period for violations

of the International Emergency Economic Powers Act and the Regulations

with respect to transactions involving Iraq. Four penalties totaling

$26,043 were collected from two banks, one company, and one individual

for violations of the prohibitions against transactions involving Iraq.

 

 

� 3. Investigation also continues into the roles played by various

individuals and firms outside Iraq in the Iraqi government procurement

network. These investigations may lead to additions to FAC's listing of

individuals and organizations determined to be SDNs of the Government of

Iraq.

 

 

� 4. Pursuant to Executive Order No. 12817 implementing United Nations

Security Council Resolution No. 778, on October 26, 1992, FAC directed

the Federal Reserve Bank of New York to establish a blocked account for

receipt of certain post August 6, 1990, Iraqi oil sales proceeds, and to

hold, invest, and transfer these funds as required by the order. On

October 5, 1994, following payments by the Governments of Canada

($677,756.99), the United Kingdom ($1,740,152.44), and the European

Community ($697,055.93), respectively, to the special United

Nations-controlled account, entitled "United Nations Security Council

Resolution 778 Escrow Account," the Federal Reserve Bank of New York was

directed to transfer a corresponding amount of $3,114,965.36 from the

blocked account it holds to the United Nations-controlled account.

Similarly, on December 16, 1994, following the payment of $721,217.97 by

the Government of the Netherlands, $3,000,891.06 by the European

Community, $4,936,808.84 by the Government of the United Kingdom,

$190,476.19 by the Government of France, and $5,565,913.29 by the

Government of Sweden, the Federal Reserve Bank of New York was directed

to transfer a corresponding amount of $14,415,307.35 to the United

Nations-controlled account. Again, on December 28, 1994, following the

payment of $853,372.95 by the Government of Denmark, $1,049,719.82 by

the European Community, $70,716.52 by the Government of France,

$625,390.86 by the Government of Germany, $1,151,742.01 by the

Government of the Netherlands, and $1,062,500.00 by the Government of

the United Kingdom, the Federal Reserve Bank of New York was directed to

transfer a corresponding amount of $4,813,442.16 to the United Nations

controlled account. Finally, on January 13, 1995, following the payment

of $796,167.00 by the Government of the Netherlands, $810,949.24 by the

Government of Denmark, $613,030.61 by the Government of Finland, and

$2,049,600.12 by the European Community, the Federal Reserve Bank of New

York was directed to transfer a corresponding amount of $4,269,746.97 to

the United Nations-controlled account. Cumulative transfers from the

blocked Federal Reserve Bank of New York account since issuance of

Executive Order No. 12817 have amounted to $157,542,187.88 of the up to

$200 million that the United States is obligated to match from blocked

Iraqi oil payments, pursuant to United Nations Security Council

Resolution 778.

 

 

� 5. The Office of Foreign Assets Control has issued a total of 533

specific licenses regarding transactions pertaining to Iraq or Iraqi

assets since August 1990. Since my last report, 37 specific licenses

have been issued. Licenses were issued for transactions such as the

filing of legal actions against Iraqi governmental entities, legal

representation of Iraq, and the exportation to Iraq of donated medicine,

medical supplies, food intended for humanitarian relief purposes, the

execution of powers of attorney relating to the administration of

personal assets and decedents' estates in Iraq, and the protection of

preexistent intellectual property rights in Iraq.

 

 

� 6. The expenses incurred by the Federal Government in the 6-month

period from August 2, 1994, through February 1, 1995, that are directly

attributable to the exercise of powers and authorities conferred by the

declaration of a national emergency with respect to Iraq are reported to

be about $2.25 million, most of which represents wage and salary costs

for Federal personnel. Personnel costs were largely centered in the

Department of the Treasury (particularly in the Office of Foreign Assets

Control, the U.S. Customs Service, the Office of the Under Secretary for

Enforcement, and the Office of the General Counsel), the Department of

State (particularly the Bureau of Economic and Business Affairs, the

Bureau of Near East Affairs, the Bureau of Organization Affairs, and the

Office of the Legal Adviser), and the Department of Transportation

(particularly the U.S. Coast Guard).

 

 

� 7. The United States imposed economic sanctions on Iraq in response to

Iraq's illegal invasion and occupation of Kuwait, a clear act of brutal

aggression. The United States, together with the international

community, is maintaining economic sanctions against Iraq because the

Iraqi regime has failed to comply fully with United Nations Security

Council resolutions. Security Council resolutions on Iraq call for the

elimination of Iraqi weapons of mass destruction, the inviolability of

the Iraq-Kuwait boundary, the release of Kuwaiti and other third-country

nationals, compensation for victims of Iraqi aggression, long-term

monitoring of weapons of mass destruction capabilities, the return of

Kuwaiti assets stolen during Iraq's illegal occupation of Kuwait,

renunciation of terrorism, an end to internal Iraqi repression of its

own civilian population, and the facilitation of access of international

relief organizations to all those in need in all parts of Iraq. More

than 4 years after the invasion, a pattern of defiance persists: a

refusal to account for missing Kuwaiti detainees; failure to return

Kuwaiti property worth millions of dollars, including weapons used by

Iraq in its movement of troops to the Kuwaiti border in October 1994;

sponsorship of assassinations in Lebanon and in northern Iraq;

incomplete declarations to weapons inspectors; and ongoing widespread

human rights violations. As a result, the U.N. sanctions remain in

place; the United States will continue to enforce those sanctions under

domestic authority.

 

 

� The Baghdad government continues to violate basic human rights of its

own citizens through systematic repression of minorities and denial of

humanitarian assistance. The Government of Iraq has repeatedly said it

will not be bound by United Nations Security Council Resolution 688. For

more than 3 years, Baghdad has maintained a blockade of food, medicine,

and other humanitarian supplies against northern Iraq. The Iraqi

military routinely harasses residents of the north, and has attempted to

"Arabize" the Kurdish, Turcomen, and Assyrian areas in the north. Iraq

has not relented in its artillery attacks against civilian population

centers in the south, or in its burning and draining operations in the

southern marshes, which have forced thousands to flee to neighboring

States.

 

 

� In 1991, the United Nations Security Council adopted Resolutions 706

and 712, which would permit Iraq to sell up to $1.6 billion of oil under

U.N. auspices to fund the provision of food, medicine, and other

humanitarian supplies to the people of Iraq. The resolutions also

provide for the payment of compensation to victims of Iraqi aggression

and other U.N. activities with respect to Iraq. The equitable

distribution within Iraq of this humanitarian assistance would be

supervised and monitored by the United Nations. The Iraqi regime so far

has refused to accept these resolutions and has thereby chosen to

perpetuate the suffering of its civilian population. More than a year

ago, the Iraqi government informed the United Nations that it would not

implement Resolutions 706 and 712.

 

 

� The policies and actions of the Saddam Hussein regime continue to pose

an unusual and extraordinary threat to the national security and foreign

policy of the United States, as well as to regional peace and security.

The U.N. resolutions require that the Security Council be assured of

Iraq's peaceful intentions in judging its compliance with sanctions.

Because of Iraq's failure to comply fully with these resolutions, the

United States will continue to apply economic sanctions to deter it from

threatening peace and stability in the region.

 

 

� William J. Clinton

 

 

� The White House, February 8, 1995.