UPDATE 2-US Congress OKs sanctions on Iran's energy, banks

Thu Jun 24, 2010 7:51pm EDT

Related Topics

* No blanket waivers for U.S. allies, trade partners

* Do business with either the U.S. or Iran, lawmakers say

* Some companies backing away from Iran already (Adds House vote, quotes)

By Susan Cornwell

WASHINGTON, June 24 (Reuters) - Congress on Thursday approved tough new unilateral sanctions aimed at squeezing Iran's energy and banking sectors, which could also hurt companies from other countries doing business with Tehran.

The House of Representatives passed the bill 408-8 and sent it to President Barack Obama for signing into law. The Senate had approved it 99-0 earlier in the day.

Congress wants to pressure Tehran into curbing its nuclear program, which Washington suspects is aimed at making a bomb.

U.S. lawmakers from both parties have been pushing for months to tighten U.S. sanctions on Iran. At the Obama administration's request, they held off until the U.N. Security Council and the European Union agreed on new multilateral sanctions. But the lawmakers then declared that still tougher measures were needed.

"The U.N. sanctions, though a good first step, are quite tepid. And they are tepid because there are other members of the Security Council who want to keep doing that business with Iran. ... The United States ... has to pass these unilateral sanctions," Democratic Senator Barbara Mikulski said.

The bill penalizes companies supplying Iran with gasoline as well as international banking institutions involved with Iran's Islamic Revolutionary Guard Corps, its nuclear program or what Washington calls its support for terrorist activity.

It would effectively deprive foreign banks of access to the U.S. financial system if they do business with key Iranian banks or the Revolutionary Guards.

Such banks would be "shut out of the U.S. financial system," said the bill's House author, Foreign Affairs Committee Chairman Howard Berman. He is a Democrat.

Global suppliers of gasoline to Iran could also face bans on access to the U.S. banking system, property transactions and foreign exchange in the United States. Iran depends on gasoline imports because it has insufficient refining capacity.

POSING A CHOICE

"Because of this legislation, we will be posing a choice to companies around the world. Do you want to do business with Iran, or do you want to do business with the United States?" Republican Senator John McCain said during Senate debate.

U.S. companies are already prohibited from doing business with Iran. Foreign companies with big investments in Iran's energy sector also can be sanctioned under current U.S. law. But many U.S. lawmakers say this has not been enforced.

Some companies worldwide, such as Italy's oil and gas company Eni EN.MI and French energy giant Total (TOTF.PA) have been backing away from business with Tehran amid the U.S. drive to isolate Iran.

But other companies are still in business with Iran or considering it. Russia's Gazprom (GAZP.MM) says it is interested in developing the Azar oil field, and industry sources say China has been selling gasoline to Iran.

PRESIDENTIAL WAIVER

The Obama administration failed to get U.S. lawmakers to make blanket exemptions for countries that are cooperating with multilateral efforts to isolate Iran.

The legislation only allows the president to waive the new sanctions on companies from "cooperating" countries on a case-by-case basis, for 12 months.

But even this waiver was too lenient for some House Republicans, who worried Obama will use it.

"The many companies from China and elsewhere, rapidly building Iran's energy facilities today, will be surely exempted from these sanctions," said Representative Ed Royce. He said he would nonetheless vote for the bill.

Russia and China, which have strong economic ties with Tehran and have at times resisted sanctions, supported recent U.N. sanctions. But they fought U.S. efforts to approve tougher measures targeting Iran's energy sector. (Editing by Deborah Charles and Xavier Briand)

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Comments (1)
lipservice13 wrote:
Washington’s “double standard” on Iran, a signatory to the nuclear Non-Proliferation Treaty (NPT), while selling “nuclear technology to Israel and India,” a non-signatory to the NPT.
US continues its annual $3 billion assistance to Israel, despite an American law forbidding aid to any country producing weapons of mass destruction. Not only did ISRAEL THREATEN TO SEND SYRIA BACK TO STONE AGE, did Massacre on Freedom Flotilla BUT ALSO Israel offered to sell apartheid-era South Africa nuclear warheads in 1975.Israel opposes creating a nuclear weapons-free zone until Middle East peace has been achieved.

Iran is a signatory of the Nuclear Non-Proliferation Treaty, is at the moment
FULLY in compliance with it, has no nuclear arsenal, and does not even have a
nuclear weapons program. (The treaty allows countries to enrich uranium for fuel, which is all that Iran
is known to be doing).

U.S. leaders often claim that they’re acting against Iran on behalf of the whole Middle East region, implying that their strategy has the backing of Arab governments. Washington hawks insist that the Arabs would applaud if the U.S. bombed Iran, utilising the silence of the Arab regimes to speak as if on their behalf. That underscores the importance of the Arab voices that have begun challenging the idea that a confrontation with Iran could produce any positive outcome.
Iran is also said to be a threat to neighbouring Arab states, thereby enabling the U.S. to sell Patriot anti-missile systems to Kuwait, Qatar, United Arab Emirates and Bahrain, and to try and sell to Turkey and Oman as well.

At last Arab League summit, the secretary general Amr Moussa called for the stand-off to be tackled through Arab dialogue with Iran. “We need to see where we differ and where we disagree with Iran and how to deal with that,” Mr Moussa said. “Iran is not an enemy but a fraternal state and dialogue will help bring about peace and stability in the region.”

INDONESIA CERTAIN IRAN’S NUCLEAR PROGRAMME NOT FOR DEFENCE PURPOSES.
OIC backs Iran nuclear declaration
The Organization of the Islamic Conference (OIC) has backed an Iranian declaration which aims to end a standoff over Tehran’s nuclear program.
118 member states of the Non-Aligned Movement (NAM), have once again voiced support for Iran’s right to the peaceful use of nuclear energy.
The organization said nations, including Iran, have an inalienable right to the peaceful use of atomic energy.

Jun 24, 2010 12:18am EDT  --  Report as abuse
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