22 USC 8513a - Imposition of sanctions with respect to the financial sector of Iran

U.S Code last checked for updates: Nov 22, 2024

§ 8513a.

Imposition of sanctions with respect to the financial sector of Iran

(a)

Findings

Congress makes the following findings:

(1)

On November 21, 2011, the Secretary of the Treasury issued a finding under section 5318A of title 31 that identified Iran as a jurisdiction of primary money laundering concern.

(2)

In that finding, the Financial Crimes Enforcement Network of the Department of the Treasury wrote, “The Central Bank of Iran, which regulates Iranian banks, has assisted designated Iranian banks by transferring billions of dollars to these banks in 2011. In mid-2011, the CBI transferred several billion dollars to designated banks, including Saderat, Mellat, EDBI and Melli, through a variety of payment schemes. In making these transfers, the CBI attempted to evade sanctions by minimizing the direct involvement of large international banks with both CBI and designated Iranian banks.”.

(3)

On November 22, 2011, the Under Secretary of the Treasury for Terrorism and Financial Intelligence, David Cohen, wrote, “Treasury is calling out the entire Iranian banking sector, including the Central Bank of Iran, as posing terrorist financing, proliferation financing, and money laundering risks for the global financial system.”.

(b)

Designation of financial sector of Iran as of primary money laundering concern

(c)

Freezing of assets of Iranian financial institutions

(d)

Imposition of sanctions with respect to the Central Bank of Iran and other Iranian financial institutions

(1)

In general

Except as specifically provided in this subsection, beginning on the date that is 60 days after December 31, 2011, the President—

(A)

shall prohibit the opening, and prohibit or impose strict conditions on the maintaining, in the United States of a correspondent account or a payable-through account by a foreign financial institution that the President determines has knowingly conducted or facilitated any significant financial transaction with the Central Bank of Iran or another Iranian financial institution designated by the Secretary of the Treasury for the imposition of sanctions pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.); and

(B)

may impose sanctions pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) with respect to the Central Bank of Iran.

(2)

Exception for sales of agricultural commodities, food, medicine, and medical devices

(3)

Applicability of sanctions with respect to foreign central banks

(4)

Applicability of sanctions with respect to petroleum transactions

(A)

Report required

(B)

Determination required

(C)

Application of sanctions

(D)

Exception

(i)

In general

Sanctions imposed pursuant to paragraph (1) shall not apply with respect to a financial transaction described in clause (ii) conducted or facilitated by a foreign financial institution if the President determines and reports to Congress, not later than 90 days after the date on which the President makes the determination required by subparagraph (B), and every 180 days thereafter, that the country with primary jurisdiction over the foreign financial institution—

(I)

has significantly reduced reduced 1

 So in original.

its volume of crude oil purchases from Iran during the period beginning on the date on which the President submitted the last report with respect to the country under this subparagraph; or

(II)

in the case of a country that has previously received an exception under this subparagraph, has, after receiving the exception, reduced its crude oil purchases from Iran to zero.

(ii)

Financial transactions described

A financial transaction conducted or facilitated by a foreign financial institution is described in this clause if—

(I)

the financial transaction is only for trade in goods or services between the country with primary jurisdiction over the foreign financial institution and Iran; and

(II)

any funds owed to Iran as a result of such trade are credited to an account located in the country with primary jurisdiction over the foreign financial institution.

(5)

Applicability of sanctions with respect to Chinese financial institutions

(A)

In general

For the purpose of paragraph (1)(A), a ‘significant financial transaction’ shall include, based on relevant facts and circumstances, any transaction—

(i)

by a Chinese financial institution (without regard to the size, number, frequency, or nature of the transaction) involving the purchase of petroleum or petroleum products from Iran; and

(ii)

by a foreign financial institution (without regard to the size, number, frequency, or nature of the transaction) involving the purchase of Iranian unmanned aerial vehicles (UAVs), UAV parts, or related systems.

(B)

Determination required

Not later than 180 days after April 24, 2024, and every year thereafter for 5 years, the President shall—

(i)

determine whether any—

(I)

Chinese financial institution has engaged in a significant financial transaction as described in paragraph (1)(A)(i); and

(II)

financial institution has engaged in a significant financial transaction as described in paragraph (1)(A)(ii); and

(ii)

transmit the determination under clause (i) to the Committee on Foreign Affairs and the Committee on Financial Services of the House of Representatives and to the Committee on Foreign Relations and the Committee on Banking, Housing, and Urban Affairs of the Senate.

(6)

Waiver

The President may waive the imposition of sanctions under paragraph (1) for a period of not more than 120 days, and may renew that waiver for additional periods of not more than 120 days, if the President—

(A)

determines that such a waiver is in the national security interest of the United States; and

(B)

submits to Congress a report—

(i)

providing a justification for the waiver;

(ii)

certifying that the country with primary jurisdiction over the foreign financial institution otherwise subject to the sanctions faced exceptional circumstances that prevented the country from being able to reduce significantly its purchases of petroleum and petroleum products from Iran; and

(iii)

that includes any concrete cooperation the President has received or expects to receive as a result of the waiver.

(e)

Multilateral diplomacy initiative

(1)

In general

The President shall—

(A)

carry out an initiative of multilateral diplomacy to persuade countries purchasing oil from Iran—

(i)

to limit the use by Iran of revenue from purchases of oil to purchases of non-luxury consumers goods from the country purchasing the oil; and

(ii)

to prohibit purchases by Iran of—

(I)

military or dual-use technology, including items—

(aa)

in the Annex to the Missile Technology Control Regime Guidelines;

(bb)

in the Annex on Chemicals to the Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons and on their Destruction, done at Paris January 13, 1993, and entered into force April 29, 1997 (commonly known as the “Chemical Weapons Convention”);

(cc)

in Part 1 or 2 of the Nuclear Suppliers Group Guidelines; or

(dd)

on a control list of the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies; or

(II)

any other item that could contribute to Iran’s conventional, nuclear, chemical, or biological weapons program; and

(B)

conduct outreach to petroleum-producing countries to encourage those countries to increase their output of crude oil to ensure there is a sufficient supply of crude oil from countries other than Iran and to minimize any impact on the price of oil resulting from the imposition of sanctions under this section.

(2)

Report required

(f)

Form of reports

(g)

Implementation; penalties

(1)

Implementation

(2)

Penalties

(h)

Definitions

In this section:

(1)

Account; correspondent account; payable-through account

(2)

Foreign financial institution

(3)

Significant reductions

(4)

United States person

The term “United States person” means—

(A)

a natural person who is a citizen or resident of the United States or a national of the United States (as defined in section 1101(a) of title 8); and

(B)

an entity that is organized under the laws of the United States or a jurisdiction within the United States.

(i)

Termination

(Pub. L. 112–81, div. A, title XII, § 1245, Dec. 31, 2011, 125 Stat. 1647; Pub. L. 112–158, title V, §§ 503(a)(1), (b)(1), 504(a), Aug. 10, 2012, 126 Stat. 1260, 1261; Pub. L. 112–239, div. A, title XII, § 1250, Jan. 2, 2013, 126 Stat. 2016; Pub. L. 118–50, div. S, § 2, Apr. 24, 2024, 138 Stat. 1003.)

cite as: 22 USC 8513a