THE WHITE HOUSE

Office of the Press Secretary

For Immediate Release July 22, 1996

TO THE CONGRESS OF THE UNITED STATES:

I hereby report to the Congress on the developments since my last report of January 22, 1996, concerning the national emergency with respect to Libya that was declared in Executive Order No. 12543 of January 7, 1986. This report is submitted pursuant to section 401(c) of the National Emergencies Act, 50 U.S.C. 1641(c); section 204(c) of the International Emergency Economic Powers Act ("IEEPA"), 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).

1. On January 3, 1996, I renewed for another year the national emergency with respect to Libya pursuant to IEEPA. This renewal extended the current comprehensive financial and trade embargo against Libya in effect since
2. Under these sanctions, all trade with Libya is prohibited, and all assets owned or controlled by the Libyan government in the United States or in the possession or control of U.S. persons are blocked.
3. There have been no amendments to the Libyan Sanctions Regulations, 31 C.F.R. Part 550 (the "Regulations"), administered by the Office of Foreign Assets Control (OFAC) of the Department of the Treasury, since my last report on January 22, 1996.
4. During the current 6-month period, OFAC reviewed numerous applications for licenses to authorize transactions under the Regulations. Consistent with OFAC's ongoing scrutiny of banking transactions, the largest category of license approvals (91) concerned requests by non-Libyan persons or entities to unblock transfers interdicted because of what appeared to be Government of Libya interests. Three licenses were issued for the expenditure of funds and acquisition of goods and services in the United States by or on behalf of accredited persons and athletes of Libya in connection with participation in the 1996 Paralympic Games. One license was issued to authorize a U.S. company to initiate litigation against an entity of the Government of Libya.
5. During the current 6-month period, OFAC continued to emphasize to the international banking community in the United States the importance of identifying and blocking payments made by or on behalf of Libya. The Office worked closely with the banks to assure the effectiveness of interdiction software systems used to identify such payments. During the reporting period, more than 129 transactions potentially involving Libya were interdicted, with an additional $7 million held blocked as of May 15.
6. Since my last report, OFAC collected eight civil monetary penalties totaling more than $51,000 for violations of the U.S. sanctions against Libya. Two of the violations involved the failure of banks to block funds transfers to Libyan-owned or Libyan-controlled banks. Two other penalties were received from corporations for export violations, including one received as part of a plea agreement before a U.S. district judge. Four additional penalties were paid by U.S. citizens engaging in Libyan oilfield-related transactions while another 30 cases involving similar violations are in active penalty processing.

On February 6, 1996, a jury sitting in the District of Connecticut found two Connecticut businessmen guilty on charges of false statements, conspiracy, and illegally diverting U.S.-origin technology to Libya between 1987 and 1993 in violation of U.S. sanctions. On May 22, 1996, a major manufacturer of farm and construction equipment entered a guilty plea in the United States District Court for the Eastern District of Wisconsin for Libyan sanctions violations. A three-count information charged the company with aiding and abetting the sale of construction equipment and parts from a foreign affiliate to Libya. The company paid $1,810,000 in criminal fines and $190,000 in civil penalties. Numerous investigations carried over from prior reporting periods are continuing and new reports of violations are being pursued.

6. The expenses incurred by the Federal Government in the 6-month period from January 6 through July 6, 1996, that are directly attributable to the exercise of powers and authorities conferred by the declaration of the Libyan national emergency are estimated at approximately $730,000. Personnel costs were largely centered in the Department of the Treasury (particularly in the Office of Foreign Assets Control, the Office of the General Counsel, and the U.S. Customs Service), the Department of State, and the Department of Commerce.

7. The policies and actions of the Government of Libya continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States. In adopting United Nations Security Council Resolution 883 in November 1993, the Security Council determined that the continued failure of the Government of Libya to demonstrate by concrete actions its renunciation of terrorism, and in particular its continued failure to respond fully and effectively to the requests and decisions of the Security Council in Resolutions 731 and 748, concerning the bombing of the Pan Am 103 and UTA 772 flights, constituted a threat to international peace and security. The United States will continue to coordinate its comprehensive sanctions enforcement efforts with those of other U.N. member states. We remain determined to ensure that the perpetrators of the terrorist acts against Pan Am 103 and UTA 772 are brought to justice. The families of the victims in the murderous Lockerbie bombing and other acts of Libyan terrorism deserve nothing less. I shall continue to exercise the powers at my disposal to apply economic sanctions against Libya fully and effectively, so long as those measures are appropriate, and will continue to report periodically to the Congress on significant developments as required by law.

WILLIAM J. CLINTON

THE WHITE HOUSE,

July 22, 1996.

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