Published November 20, 2014
House and Senate negotiators reached agreement Monday on a new round of stifling sanctions on Iran, targeting energy, shipping and insurance sectors with punitive measures to derail Tehran's suspected push for nuclear weapons.
Lawmakers filed a final bill late Monday that expands on existing penalties, with a House vote expected as early as Wednesday. Congress has just a week before a monthlong August recess and members see the legislation as the last chance to impose crippling sanctions that hit Iran's economy and its ability to finance its nuclear program.
"The bill sends a clear message to the Iranian regime that the U.S. is committed, through the use of sanctions, to preventing Iran from crossing the nuclear threshold," said Rep. Ileana Ros-Lehtinen, R-Fla., chairwoman of the House Foreign Affairs Committee.
Sanctions have broad bipartisan support in Congress. Crucial to the bill is the strong backing of the American Israel Public Affairs Committee, the powerful pro-Israel lobbying group.
Sen. Tim Johnson, D-S.D., chairman of the Senate Banking Committee, said the bill reconciles the House and Senate bills and incorporates new provisions from lawmakers. He vowed to help pass it in the Senate before Congress adjourns.
Unless Iranians, "come clean on their nuclear program, end the suppression of their people, and stop supporting terrorist activities, they will face deepening international isolation and even greater economic and diplomatic pressure," Johnson said.
The two lawmakers and their staff worked for weeks behind closed doors to come up with a bill.
The bill would sanction many transactions related to the energy sector and prohibit Iran from transferring money back to the country from oil sales to foreign nations.
Any company shipping proliferation-sensitive goods to Iran would be subject to penalties under the bill, a provision pushed by Sen. Bob Menendez, D-N.J. The bill also calls for sanctions on anyone who provides insurance or reinsurance to a shipping service from Iran. One of the main targets of the measure is the National Iranian Tanker Co., the state-run company and shipping line.
The bill also would deny visas and freeze assets on individuals and companies that supply Iran with technology that could be used against its citizens, such as tear gas, rubber bullets and surveillance equipment. The bill extends those sanctions on human rights violators to Syria, where President Bashar Assad's regime is accused of a bloody crackdown against protesters
The bill targets Iran's Revolutionary Guard Corps and requires companies that trade on the U.S. stock exchange to disclose any Iran-related business to the Securities and Exchange Commission.
The bill also goes after anyone who helps Iran evade oil sanctions through reflagging of vessels and any entity that is involved in uranium mining with Iran worldwide. Sanctions also would extend to anyone who transports crude oil from Iran and hides its origin, or carries refined petroleum products to Iran.
The United States and Europe argue that depriving Iran of its oil income would thwart its suspected drive for nuclear weapons. Iran has exported 2.5 million barrels of oil per day to Europe, China, India, Japan and South Korea. U.S. officials say the penalties have reduced Iran oil exports to less than 1.8 million barrels per day, costing Iran about $63 million per day.
But while Congress works on more sanctions, their effectiveness in deterring Iran from pursuing nuclear weapons is being challenged.
"All the sanctions and diplomacy so far have not set back the Iranian program by one iota," Israeli Prime Minister Benjamin Netanyahu said this past weekend.
A few lawmakers said they were frustrated that the legislation didn't go far enough.
Several proponents of tough sanctions such as Rep. Ted Deutch, D-Fla., Sen. Mark Kirk, R-Ill., Rep. Robert Dold, R-Ill., and Rep. Brad Sherman, D-Calif., had pressed negotiators to blacklist Iran's energy sector, labeling it a "zone of proliferation concern" that effectively bans all business.
But the bill says the president should impose sanctions and the provision is non-binding.
Lawmakers also pushed for sanctions on the directors and shareholders of organizations like SWIFT, the Society for Worldwide Interbank Financial Telecommunications, unless they stop providing services to the Central Bank of Iran. The draft bill does not target the directors.
Mark Dubowitz, a sanctions expert and executive director of the Foundation for Defense of Democracies, described the legislation as a "strong bill that fills numerous loopholes and tightens the sanctions requirements but it could be a lot tougher" if Congress understood as much about the psychology as the legality of sanctions. Dubowitz said Iran often figures out ways to get around the penalties.
The new legislation builds on penalties that went into effect this year. Those sanctions target foreign financial institutions that do business with Iran's central bank by barring them from opening or maintaining correspondent operations in the United States. It applies to foreign central banks only for transactions that involve the sale or purchase of petroleum or petroleum products.