After several weeks of negotiations, it seems as if a new round of Iran sanctions is one step closer to becoming law. This afternoon House Foreign Affairs Committee Chairman Howard Berman (D-Calif.) and Senate Banking Committee Sen. Christopher Dodd (D-Conn.) issued a joint statement that an agreement had been reached on new measures targeting Iran’s energy sector:
“A month ago, we announced our intention to develop a powerful package of new sanctions against Iran that would substantially augment ongoing multilateral efforts by the U.N. Security Council and the European Union. Our agreement does just that … If applied forcefully by the President, this act will bring strong new pressure to bear on Tehran in order to combat its proliferation of weapons of mass destruction, support for international terrorism, and gross human rights abuses.”
Among other things, the measure establishes three new sanctions, in addition to the menu of six sanctions that already exists under the Iran Sanctions Act (ISA), including: (1) a prohibition on access to foreign exchange in the U.S.; (2) a prohibition on access to the U.S. banking system; and (3) a prohibition on property transactions in the U.S. The law would require that the President to impose at least three of the possible now-nine sanctions on an entity in violation of ISA.
In addition to restricting new types of financial and energy sector transactions, the measure codifies longstanding executive orders and limits goods exempted from the embargo (potentially having an impact beyond the energy sector). The measure will also hold U.S. financial institutions accountable for actions by their foreign subsidiaries.
The UN Iran sanctions are a weak baseline. Today’s Congressional rhetoric notwithstanding, the new restrictions are a slap on the wrist on the Iranian regime – at best.