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Office of the Press Secretary

For Immediate Release May 14, 1993


I hereby report to the Congress on developments since the last Presidential report on November 10, 1992, concerning the national emergency with respect to Iran that was declared in Executive Order No. 12170 of November 14, 1979, and matters relating to Executive Order No. 12613 of October 29, 1987. This report is submitted pursuant to section 204(c) of the International Emergency Economic Powers Act, 50 U.S.C. 1703(c), and section 505(c) of the International Security and Development Cooperation Act of 1985, 22 U.S.C. 2349aa-9(c). This report covers events through March 31, 1993. The last report, dated November 10, 1992, covered events through October 15, 1992.

  1. There have been no amendments to the Iranian Transactions Regulations ("ITRs"), 31 CFR Part 560, or to the Iranian Assets Control Regulations ("IACRs"), 31 CFR Part 535, since the last report.
  2. The Office of Foreign Assets Control ("FAC") of the Department of the Treasury continues to process applications for import licenses under the ITRs. However, as previously reported, recent amendments to the ITRs have resulted in a substantial decrease in the number of applications received relating to the importation of nonfungible Iranian-origin goods.

During the reporting period, the Customs Service has continued to effect numerous seizures of Iranian-origin merchandise, primarily carpets, for violation of the import prohibitions of the ITRs. FAC and Customs Service investigations of these violations have resulted in forfeiture actions and the imposition of civil monetary penalties. Additional forfeiture and civil penalty actions are under review.

3. The Iran-United States Claims Tribunal (the "Tribunal"), established at The Hague pursuant to the Algiers Accords, continues to make progress in arbitrating the claims before it. Since the last report, the Tribunal has rendered 12 awards, for a total of 545 awards. Of that total, 367 have been awards in favor of American claimants: 222 of these were awards on agreed terms, authorizing and approving payment of settlements negotiated by the parties, and 145 were decisions adjudicated on the merits. The Tribunal has issued 36 decisions dismissing claims on the merits and 83 decisions dismissing claims for jurisdictional reasons. Of the 59 remaining awards, 3 approved the withdrawal of cases, and 56 were in favor of Iranian claimants. As of March 31, 1993, awards to successful American claimants from the Security Account held by the NV Settlement Bank stood at $2,340,072,357.77.

As of March 31, 1993, the Security Account has fallen below the required balance of $500 million 36 times. Iran has periodically replenished the account, as required by the Algiers Accords, by transferring funds from the separate account held by the NV Settlement Bank in which interest on the Security Account is deposited. Iran has also replenished the account with the




proceeds from the sale of Iranian-origin oil imported into the United States, pursuant to transactions licensed on a case-bycase basis by FAC. Iran has not, however, replenished the account since the last oil sale deposit on October 8, 1992. The aggregate amount that has been transferred from the Interest Account to the Security Account is $874,472,986.47. As of March 31, 1993, the total amount in the Security Account was $216,244,986.03, and the total amount in the Interest Account was $8,638,133.15.

4. The Tribunal continues to make progress in the arbitration of claims of U.S. nationals for $250,000.00 or more. Since the last report, nine large claims have been decided. More than 85 percent of the nonbank claims have now been disposed of through adjudication, settlement, or voluntary withdrawal, leaving 76 such claims on the docket. The larger claims, the resolution of which has been slowed by their complexity, are finally being resolved, sometimes with sizable awards to the U.S. claimants. For example, two claimants were awarded more than $130 million each by the Tribunal in October 1992.

5. As anticipated by the May 13, 1990, agreement settling the claims of U.S. nationals for less than $250,000.00, the Foreign Claims Settlement Commission ("FCSC") has continued its review of 3,112 claims. The FCSC has issued decisions in 1,201 claims, for total awards of more than $22 million. The FCSC expects to complete its adjudication of the remaining claims in early 1994.

6. In coordination with concerned Government agencies, the Department of State continues to present United States Government claims against Iran, as well as responses by the United States Government to claims brought against it by Iran. In November 1992, the United States filed 25 volumes of supporting information in case B/1 (Claims 2 & 3), Iran's claim against the United States for damages relating to its Foreign Military Sales Program. In February of this year, the United States participated in a daylong prehearing conference in several other cases involving military equipment. Iran also filed a new interpretative dispute alleging that the failure of U.S. courts to enforce an award against a U.S. corporation violated the Algiers Accords.

7. As reported in November, Jose Maria Ruda, President of the Tribunal, tendered his resignation on October 2, 1992. No successor has yet been named. Judge Ruda's resignation will take effect as soon as a successor becomes available to take up his duties.

8. The situation reviewed above continues to involve important diplomatic, financial, and legal interests of the United States and its nationals. Iran's policy behavior presents challenges to the national security and foreign policy of the United States. The IACRs issued pursuant to Executive Order No. 12170 continue to play an important role in structuring our relationship with Iran and in enabling the United States to implement properly the Algiers Accords. Similarly, the ITRs issued pursuant to Executive Order No. 12613 continue to advance important objectives in combatting international terrorism. I shall exercise the powers at my disposal to deal with these problems and will report periodically to the Congress on significant developments.



May 14, 1993.

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