US House Passes Expanded Sanctions Bill Against Iran

The US House Foreign Affairs Committee passed on 28 October a new bill that empowers the administration of US President Barack Obama to levy heavy fines and exclude any company exporting petroleum products to Iran from Strategic Oil Reserve contracts. The legislation, sponsored by almost 75% of the House members, was nearly unanimously accepted. The bill expands the existing Iran Sanctions Act to cover a wider range of financial institutions, banks, insurance and reinsurance companies extending credit or liability insurance to any investment from an Iranian company. It also extends to financial institutions providing services to third parties on any component of Iran’s hydrocarbon industry, including oil and gas pipelines, tankers, retail and gasoline distribution networks, and refinery equipment.

The Chairman of the Committee Howard Berman, (D Calif), said the bill will “maximize the chances that Iran, the leading state sponsor of terrorism, will be prevented from acquiring the capacity to produce nuclear arms. That capacity would pose perhaps the most serious strategic threat to our nation. It will, at least, force the Iranians to think twice about continuing to flout the will of the international community.” The bill, which has yet to clear the Senate’s Banking Committee, also calls upon the administration to inform Congress on any potential violators every six months. The Obama administration, as well as any administration since the original drafting of the Iran Libya Sanctions Act (ILSA) of 1996, has refused to levy sanctions on non-American companies operating or investing in Iran since such an act would create extraterritoriality issues for governments of any targeted companies. It thereby has the potential to limit the chances of US diplomacy to establish an international consensus isolating Tehran. Iran’s largest fuel exporters include India’s Reliance, Switzerland’s Vitol, BP, Shell and Total. 

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