Section 505 of this Act authorizes the President to restrict or ban imports of goods and services from countries that have been determined by the United States to support terrorism or terrorist organizations or harbor terrorists or terrorist organizations. The State Department designated terrorist countries are currently: Cuba, Iran, Iraq, Libya, North Korea, Sudan and Syria.

Section 504 of this Act also authorizes the President to prohibit imports of goods and services from Libya, or exports of goods and technology to Libya.

These provisions of the Act have been invoked with respect to:

• Iran, leading to the import restrictions contained in the OFAC regulations pursuant to IEEPA (see section I.A. above). Exec. Order No. 12613 (10/29/87); 52 Fed. Reg. 41940.

• Libya, prohibiting imports of oil. Exec. Order No. 12538 (11/15/85); 50 Fed. Reg. 47527.

• Libya, imposing general trade sanctions. Executive Order No. 12543 (1/7/86); 51 Fed. Reg. 875.

This Act prohibits persons subject to U.S. jurisdiction from providing support to foreign organizations that engage in terrorist activities. The Act provides for the designation of "terrorist organizations" by the Secretary of State, authorizes the Secretary of the Treasury to block the assets of such organizations, and prohibits certain trade and financial transactions with respect to those organizations. The Secretary of State has not designated any such organizations.

Section 321 of the Act also prohibits financial transactions by U.S. persons with the governments of the State Department designated terrorist countries under the EAA. These are currently Cuba, Iran, Iraq, Libya, North Korea, Sudan and Syria.

• These restrictions are implemented in the OFAC regulations (discussed under IEEPA at section I.A.) for Cuba, Iran, Iraq, Libya and North Korea.

• The OFAC regulations prohibit U.S. persons from receiving donations from, or engaging in certain financial transactions with, the governments of Syria and Sudan. The prohibited financial transactions are those which the U.S. person knows or believes may pose a risk of furthering terrorist acts in the United States. See Terrorism List Governments Sanctions Regulations, 31 C.F.R. Part 596 (1996).

This Act adds Sections 620G and 620H to the Foreign Assistance Act (discussed at section IV) to prohibit certain U.S. Government foreign assistance to any country that provides assistance or lethal military equipment to the government of a designated terrorist country.

This Act adds Section 1621 to the International Financial Institutions Act (discussed at section VI.A.1.) to require U.S. representatives at international financial institutions to vote against loans or other financial assistance to the designated terrorist countries.

This Act also adds Section 40A to the AECA (discussed at section III.A.) to prohibit the issuance of licenses for the export of any defense item to a country that the President certifies is not fully cooperating with the U.S. antiterrorism effort.

This provision denies foreign tax credit to taxpayers for certain taxes paid to the State Department designated terrorist countries³¹.

This Act requires entities submitting bids in response to a Department of Defense solicitation to disclose certain ownership interests. Bidding entities must disclose any significant ownership interest of a government of a State Department designated terrorist country in that entity. Bidding entities that are subsidiaries must also disclose such ownership interest in the parent corporation.

The Department of Defense is prohibited from entering into contracts of $100,000 or more with certain entities, or their subsidiaries, that are owned or controlled by the government of a State Department designated terrorist country. This prohibition may be waived upon certain findings by the Secretary of Defense.

This Act contains a prohibition on the use of Department of Defense funds to provide assistance to the State Department designated terrorist countries, and other countries identified as supporting international terrorism or as granting sanctuary to terrorists.

The President is authorized to waive this prohibition for humanitarian or national security reasons.

The OFAC Terrorism Sanctions Regulations ³² block all property subject to U.S. jurisdiction of certain Middle East terrorist organizations (and of other persons posing a threat to the Middle East Peace Process or who assist such persons). Exec. Order No. 12947 (1/24/95). A list of all persons and entities whose property is blocked under the regulations is available from OFAC.

Section 620A of this Act prohibits assistance from the United States Government, including support or funds by the Export-Import Bank or the Overseas Private Investment Corporation, to the State Department designated terrorist supporting countries³³.

Section 527 of this Act requires the U.S. executive directors of international financial institutions to vote against loans or other assistance to the State Department designated terrorist supporting countries³⁴.

Section 527A prohibits the use of funds under this Act for bilateral assistance to any country determined by the President to be providing sanctuary to any individual or group that has committed an act of international terrorism or otherwise supporting such terrorism. The President may waive the application of this prohibition for national security or humanitarian reasons.

Section 527 prohibits the use of funds under this Act for bilateral assistance to any country determined by the President to be providing sanctuary to any individual or group that has committed an act of international terrorism or otherwise supporting such terrorism. The President may waive the application of this prohibition for national security or humanitarian reasons.

Section 551 prohibits the use of funds under this Act for assistance to foreign governments that provide lethal military equipment to a State Department designated terrorist country. The President may waive this prohibition if it would be in the national interest³⁵.

Section 553 of this Act prohibits the transfer of "spoils of war" in the possession, custody or control of the United States to the State Department designated terrorist countries. "Spoils of war" is defined to include lawfully taken enemy movable property that has become property of the United States pursuant to the laws of war.

Under Sections 481 and 490, the Act prohibits foreign assistance, including Export-Import Bank and OPIC funding, to drug producing or transit countries that have been denied counternarcotics certification. U.S. representatives in international multilateral banks must also vote against loans or other financial assistance to drug producing or transit countries that have been denied counternarcotics certification.

Certification is granted to countries that the President determines have cooperated with the United States, or have otherwise taken adequate steps to prevent narcotics from being illegally sold or transported to the United States and to prevent drug-related money laundering and public corruption. Additional requirements for certification are placed on countries that have been designated a major drug producing/drug-transit country two years in a row or that are producers of opium.

Certification may also be granted to a country if the President determines that it would be in the "vital national interests" of the United States.

• By Presidential Determination No. 96-13, at least 25 drug producing or transit countries have been certified. Lebanon, Pakistan, and Paraguay have been certified under the "vital national interests" provision. Afghanistan, Burma, Colombia, Iran, Nigeria, and Syria have been denied certification. 61 Fed. Reg. 9891(3/1/96).

Section 802 of this Act requires the President to apply certain sanctions to major drug producing and drug-transit countries. These include denial of preferential tariff treatment under the Generalized System of Preferences and other tariff programs, and an increase in duty rates on products imported from those countries. The President is also required to take certain steps to curtail air transportation between the United States and such countries. These sanctions are not to be applied to countries certified each year by the President, under the Foreign Assistance Act (see preceding page).

• By Presidential Determination No. 96-13, at least 25 drug producing or transit countries have been certified. As of March 1, 1996, Afghanistan, Burma, Colombia, Iran, Nigeria, and Syria have been denied certification. 61 Fed. Reg. 9891.

Under Section 803 of this Act, the President is prohibited from allocating any quota for imports of sugar to any country whose government is involved in illegal drug trade, or is failing to cooperate with the United States in narcotics enforcement activities.

The property of specified drug cartel members and other foreign persons playing a role in international narcotics, or assisting or supporting such persons, is blocked. Exec. Order No. 12978 (10/21/95); 60 Fed. Reg. 54579. Also blocked are the assets of persons owned or controlled by the aforementioned persons. A list of all persons whose property is blocked is available from OFAC.

Section 587 withholds $2.5 million in funding made available under the Act to the Government of Mexico until the President determines that it is: taking steps to reduce the traffic of illegal drugs into the United States; applying resources to capture and prosecute individuals involved in the drug trade; and cooperating with international and U.S. efforts at drug interdiction and prevention of money-laundering.

This Act was enacted to protect marine mammals. With respect to marine mammals incidentally taken during the course of commercial fishing, it is the stated goal of the Act to reduce the kill or injury of such mammals to zero.

Under Section 101, this Act provides sanctions where commercial fish are caught with commercial fishing technology which results in the incidental kill or serious injury of ocean mammals in excess of U.S. standards. With respect to dolphins in particular, the Secretary of the Treasury is required to ban imports of yellowfin tuna harvested with purse seine nets from the eastern tropical Pacific Ocean, unless the exporting country meets certain requirements under this Act.

Imports of yellowfin tuna are permitted where the exporting country can show that it has adopted a regulatory conservation program comparable to that of the United States, and that the average dolphin mortality rate of its tuna harvesting fleet is comparable to that of the U.S. fleet. Imports from intermediary exporting countries are permitted where those governments can demonstrate that they have not imported yellowfin tuna, or products thereof, that are subject to a ban on direct exportation to the United States.

Under Section 305, imports of yellowfin tuna also are permitted from a country that commits to, and implements, a moratorium on the use of purse seine nets and a certain reduction in the dolphin mortality rate.

• As of November 1, 1996, import embargoes under this Act are being applied to Mexico, Venezuela, Colombia, Panama, Vanuata, Belize, Costa Rica, Italy and Japan.

Six months after importation of yellowfin tuna has been banned from a particular country, the Secretary of the Treasury is required to "certify" this fact to the President under the "Pelly Amendment" (discussed below at section II.C.3.). This authorizes the President to ban imports of additional products from the certified country.

Section 609 of this Act amends the Endangered Species Act with respect to certain species of sea turtles. A ban is required on the import of shrimp and shrimp products that have been harvested with commercial fishing technology that adversely affects these species of sea turtles.

The ban on imports is not applied to countries that have been certified by the President as having adopted a regulatory program governing the incidental take of sea turtles, and as having an incidental take rate for sea turtles that is comparable to that of the United States. The President may also certify countries as not posing a threat of the incidental take of the protected sea turtle species.

• As of April 30, 1996 only 36 countries were certified. 61 Fed. Reg. 24998 (5/17/96). Honduras and Thailand gained certification on August 22, 1996 and November 22, 1996 respectively. 61 Fed. Reg. 59482 (11/22/96). The People's Republic of China and Nigeria gained certification on December 23, 1996 and January 1, 1997 respectively. 62 Fed. Reg. 4826 (1/31/97). All shrimp imports, with certain exceptions, from non-certified countries were prohibited beginning September 1, 1996. 61 Fed. Reg. 43395.

Section 8 of this Act (known as the Pelly Amendment) authorizes the President to impose import restrictions on any product from a "certified" country which, by trade or fishing practice, undermines international programs for fishery conservation or for endangered or threatened species.

The Secretary of Commerce determines when nationals of a foreign country are conducting fishing operations in a manner that undermines international fishery conservation. Both the Secretary of Commerce or of the Interior may determine when foreign nationals are engaging in practices which undermine an international program for threatened/endangered species. Upon making such a determination, the Secretaries are required to certify such facts to the President.

Determinations under other Acts, such as the Marine Mammal Protection Act (discussed above at section II.C.1.) may also operate as "certification" under the Pelly Amendment.

• Taiwan was certified under this Act by the Secretary of the Interior in September 1993, due to its trade in tiger and rhinoceros products. In April 1994, the President banned imports of certain fish and wildlife and related products from Taiwan. See 59 Fed. Reg. 40463 (8/2/94). The sanctions were lifted by the President in June 1995, and Taiwan was decertified by the Secretary of the Interior on September 11, 1996.

• China was also certified by the Secretary of the Interior in September 1993, for its practices undermining conservation programs. Trade sanctions were never imposed by the President.

• Canada was certified on December 12, 1996 by the Secretary of Commerce for permitting the killing of bowhead whales.

This Act requires the President to enter into consultations with any country whose nationals are found by the Secretary of Commerce to be conducting large-scale driftnet fishing beyond that country's exclusive economic zone.

If the consultations with the government of the identified nation are not "satisfactorily concluded" within 90 days, the President must prohibit the importation of fish, shellfish, fish products and sport fishing equipment from that country.

Six months after a country has been identified by the Secretary of Commerce, the Secretary is required to determine if the import ban described above is insufficient to cause the foreign country to stop large-scale driftnet fishing, or if the foreign country has retaliated against the United States as a result of the import ban. An affirmative determination by the Secretary operates as a "certification" under the Pelly Amendment (discussed above at section II.C.3.), and additional sanctions by the President are authorized.

• Italy has been identified as a large-scale driftnet fishing country under this Act, and negotiations with the Department of Commerce are currently underway. See 61 Fed. Reg. 18721 (4/29/96).

Under this section, funds appropriated by this Act under the Foreign Assistance Act cannot be provided to any country whose government knowingly grants sanctuary to persons indicted by the International Criminal Tribunals for the former Yugoslavia or Rwanda, or any other similar international tribunal, or to persons indicted for certain war crimes during World War II.

The U.S. executive directors of international financial institutions are required to vote against funds or other assistance to countries harboring the persons described above.

Section 568 of this Act authorizes the President to withhold funds for assistance under the Foreign Assistance Act or the Arms Export Control Act to any country whose government knowingly grants sanctuary to persons indicted by the International Criminal Tribunals for the former Yugoslavia or Rwanda, or any other similar international tribunal, or to persons indicted for certain war crimes during World War II.

The Secretary of the Treasury "should" also instruct the U.S. executive directors of international financial institutions to vote against funds or other assistance to countries harboring the persons described above.

This Act contains missile technology control provisions related to items listed on the Missile Technology Control Regime ("MTCR") Annex³⁶. Mandatory sanctions are required for the export or the facilitation of exports of certain items to non-MTCR adherent countries by foreign persons, which include individuals and entities.

Sanctions are required against foreign persons who engage in the trade of an item on the MTCR Annex to a non-MTCR country, where such action contributes to the production of missiles in the non-MTCR country. These sanctions are applied even though the Annex item may not be subject to U.S. jurisdiction (i.e. it is not of U.S. origin or made from U.S.-origin technology).

Foreign persons engaging in prohibited trade with respect to certain items listed on the Annex (i.e. Category II items) are prohibited from participating in U.S. Government contracts relating to missile equipment or technology. Licenses for the transfer of such items under the Arms Export Control Act ("AECA") or the Export Administration Act ("EAA") to such foreign persons are subject to denial. If the prohibited trade involves certain other items listed on the Annex (i.e. Category I items), the sanctioned person cannot participate in any U.S. Government contract and will be subject to denial of all export licenses of AECA and EAA controlled items. The sanctions last for two years.

In addition, if the President determines that the prohibited trade by a foreign person makes a "substantial contribution" to missile proliferation, a minimum two-year ban on the import of goods produced by the foreign person is required.

Where a foreign person in a nonmarket economy is sanctioned under this Act, certain sanctions must also be applied to the government of that foreign country. This provision, known as the "Helms Amendment", was intended at the time it was enacted to apply to China. Export licenses under the AECA, participation in U.S. Government contracts, and import prohibitions must be applied to the foreign government with respect to missile equipment or technology, electronics, space systems and military aircraft. Accordingly, a government entity, or other government activity, that is involved in the above described areas, will be unable to receive defense item exports, or participate in U.S. Government contracts. Where the import sanction has also been triggered, it appears that products made by a government entity in the areas of electronics, missile technology, space systems or military aircraft will be banned from import into the United States. The import sanction has never been applied to the government of a nonmarket economy.

The President is permitted to waive the sanctions described above if "essential to the national security". This waiver has been exercised with respect to China in the past. See 59 Fed. Reg. 55522 (11/7/94).

Sanctions pursuant to this Act are currently imposed against:
• Changgwang Sinyong Corporation (North Korea) Ministry of Defense Armed Forces Logistics (Iran) State Purchasing Office (Iran) 61 Fed. Reg. 29785 (6/12/96)

Sanctions pursuant to this Act have been imposed in the past against:

• The governments of China and Pakistan. 58 Fed. Reg. 45408 (8/24/93). The sanctions against China were waived on November 1, 1994, and the sanctions against Pakistan expired after 2 years.

Sections 821 and 824 of this Act provide mandatory sanctions where the President determines that U.S. or foreign persons have contributed to the efforts of any person, group or non-nuclear weapons state to acquire certain nuclear material or devices. The sanctions, with certain exceptions, are a ban on entry into U.S. Government procurement contracts or dealing in U.S. Government debt instruments for at least 12 months.

Section 825 of this Act amends the Export-Import Bank Act to prohibit the Bank from providing funding to countries that aid/abet a non-nuclear weapon state in acquiring certain nuclear devices or materials (see discussion at VI.B.).

Section 530 of this Act prohibits assistance under the Foreign Assistance Act to non-nuclear weapons states that violate International Atomic Energy Agency agreements or U.S. bilateral nuclear cooperation agreements.

The Act amends the Arms Export Control Act ("AECA") to prohibit sales of defense items and services by the U.S. Government to countries in breach of certain nuclear non-proliferation agreements. This Act also expands the definition of "terrorist" under the AECA, for purposes of prohibiting sales of defense items and services by the U.S. Government, or the issuance of export licenses, to countries supporting terrorist activity. "Terrorist" activity is expanded to include participation in the proliferation of nuclear explosive devices or certain nuclear material.

This Act also adds Sections 101 and 102 to the AECA. Section 101 prohibits economic or military assistance under the Foreign Assistance Act and the AECA to countries, determined by the President, that deliver or receive certain nuclear enrichment materials or technology without certain safeguards. The President may certify exceptions to these prohibitions in the national interest or upon receiving adequate assurances from the country that the proscribed activity would stop.

Under Section 102 of the AECA, economic and military assistance is also withheld from countries that deliver certain nuclear reprocessing materials or technology, and from non-nuclear weapon states which illegally export, or attempt to export, from the United States any material, equipment or technology for use in the manufacture of a nuclear explosive device.

Sanctions also are required under Section 102 of the AECA where the President determines that a country has transferred to a non-nuclear weapons state, or that a non-nuclear weapons state has received, certain nuclear devices, components or designs.

The sanctions required to be imposed include: termination of most assistance under the Foreign Assistance Act; termination of defense sales or licenses for export under the AECA; denial of credit, guarantees or financial assistance by the U.S. Government; opposition by U.S. representatives in international financial institutions to loans or financial or technical assistance; and prohibition of certain exports under the EAR.

The President may waive the imposition of sanctions under section 102 upon certification that the sanctions would obstruct U.S. non-proliferation objective or jeopardize the national defense.

This Act prohibits the export of certain defense articles and services and other goods and technology that assist another country to acquire, develop or use chemical or biological weapons. Sections 306 and 307 of this Act provide mandatory sanctions against countries that are determined by the Secretary of State to have used chemical or biological weapons in violation of international law or against its own nationals.

These sanctions are: termination of most U.S. assistance pursuant to the Foreign Assistance Act; termination of U.S. foreign military financing; prohibition of sales or exports of certain goods under the Arms Export Control Act ("AECA") and the Export Administration Act ("EAA"); and denial of assistance from the Export-Import Bank. The President is authorized to waive the application of these sanctions in the national interest.

This Act also adds Section 81 to the AECA and Section 11C to the EAA. These sections contain mandatory sanctions against foreign persons who export goods or technology that would be controlled for export or reexport if they were of U.S. origin. Sanctions are applied where such exports contribute to the efforts to acquire chemical or biological weapons by a designated terrorist country or a country that has used or prepared to use such weapons in violation of international law or against its own nationals. The President may also designate any other foreign country, project, or entity for sanctions under this Act. Sanctioned persons are prohibited from participating in U.S Government procurement contracts and goods produced by the sanctioned person are prohibited from import into the United States.

The President has expanded the mandatory sanctions described above, under the broad authority of IEEPA. Exec. Order No. 12938 (11/14/94); 59 Fed. Reg. 58099. Sanctions against foreign countries were expanded to also include U.S. opposition to loans or financial assistance from international financial institutions, prohibition of all arms sales, and more stringent export and import restrictions. Mandatory sanctions were also extended to foreign persons who contribute to the efforts of any country to acquire chemical or biological weapons.

Under Section 123 of the Act, exports of certain nuclear materials and equipment to a foreign country are prohibited unless that country has entered into an agreement for cooperation with the United States. An agreement for cooperation must contain certain safeguards with respect to the use and transfer of certain nuclear equipment and materials. Proposed agreements for cooperation must be submitted to Congress, which may disapprove the agreement by joint resolution within 60 days.

• The Agreement for Cooperation Between the Government of the United States and the Government of the People's Republic of China Concerning Peaceful Uses of Nuclear Energy was signed on July 23, 1985, but was disapproved by Congress. See S.J. Res. 238, 95th Cong., 2nd Sess., 99 Stat. 1174 (12/16/85). The Joint Resolution provides that the Agreement will become effective upon certification by the President that, among other things, China is not in violation of Section 129 of the Atomic Energy Act (see II.B.5. next page), and submission by the President of a report detailing the history and current developments in the nonproliferation policies and practices of China³⁷.

Other restrictions on exports of nuclear equipment and materials have been added to the Atomic Energy Act by the Nuclear Non-Proliferation Act of 1978 (see II.B.5. next page).

This Act adds Section 129 to the Atomic Energy Act (see II.B.4.). This provision prohibits exports of nuclear materials, equipment and certain technology to non-nuclear weapons states found by the President to have: detonated a nuclear explosive device, terminated or violated an International Atomic Energy Agency ("IAEA") safeguard or agreement, or engaged in certain other activities related to nuclear explosive devices.

This provision also prohibits exports of such items and technology to countries found by the President to have: violated a cooperation agreement with the United States; assisted or encouraged any non-nuclear weapon state to engage in certain activities related to nuclear material and failed to take steps to terminate such assistance/encouragement; or entered into an agreement to transfer certain nuclear material to a non-nuclear weapon state.

The President may permit exports from the United States otherwise prohibited by this provision upon a determination that cessation of such exports would be seriously prejudicial to the achievement of U.S. non-proliferation objectives, or would otherwise jeopardize the common defense and security.

• Romania has been determined to have violated an IAEA safeguard under this Act, but the prohibition on nuclear exports was waived. 58 Fed. Reg. 48261 (8/30/93).

This Act prohibits imports of goods mined, produced or manufactured by convict labor, forced labor or indentured labor. The prohibition does not apply to goods otherwise unavailable to meet the "consumptive demands" of the United States. The Secretary of the Treasury is authorized to promulgate regulations for the enforcement of this provision.

The Treasury regulations provide for determinations by the Commissioner of Customs that available information reasonably indicates that particular merchandise is in violation of this Act. Upon such a determination, shipments of the specified merchandise will be withheld at the port of entry, unless the importer can establish that the goods were not made in violation of the Act. See 19 C.F.R. § 12.42 (1996).

This Act is currently being applied in the following ways:

• Treasury regulations currently indicate that certain items from Mexico are made in violation of this Act, and so will be denied entry into U.S. ports. See 19 C.F.R. §12.42 (1996).

• Sheepskin and leather products from the Qinghai Hide and Garment Factory, and iron pipe fittings from the Tianjin Malleable Iron Factory are made in violation of this Act and are prohibited from import into the U.S. See 58 Fed. Reg. 32746 (6/11/93); 61 Fed. Reg. 17956 (4/23/96).

President Clinton entered into a Memorandum of Understanding with China based on the prohibition contained in this Act on August 7, 1992. Review of China's compliance with the Memorandum was added to the annual assessment of China's Most-Favored-Nation status in 1994. Exec. Order No. 12850 (5/28/93); 58 Fed. Reg. 31327.

This Act prohibits the sale of defense articles or services by the U.S. Government to any country or international organization that is "known to" have a policy or practice of requesting compliance with, or information in furtherance of, the Arab League secondary boycott of Israel. The President may certify that a particular country or organization does not currently maintain such a policy or practice.

• This provision is currently being applied to Iran, Iraq, Libya, Sudan, Syria and Yemen.

  The President has certified that the following countries do not maintain a policy or practice subject to the provisions of this Act: Djibouti, Egypt, Jordan, Mauritania, Morocco, Nigeria, Pakistan, Somalia, Sri Lanka, Tanzania, Tunisia, and Uganda. See 60 Fed. Reg. 22245 (5/1/95); 61 Fed. Reg. 26029 (4/30/96).

The President may waive the application of this prohibition to a particular country for a one-year period, if he determines that this would be in the national interest and would further the elimination of the Arab boycott, or if he determines that it would be in the national security interest. The waiver may be extended by the President for additional one-year periods if he determines that it would promote the elimination of the Arab boycott.

The President has waived the application of this section of the Act to Algeria, Bahrain, Bangladesh, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. See 61 Fed. Reg. 26029 (4/30/96).