Letter to the Speaker of
the House of Representatives and the President of the Senate Reporting on the
National Emergency With Respect to Libya
January 11, 1989
Mr. Speaker: (Dear Mr. President:)
I hereby report to the Congress on developments since my last report of July
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, 50
U.S.C. 1703(c) (``IEEPA''); and section 505(c) of the International Security
and Development Cooperation Act of 1985, 22 U.S.C. 2349aa - 9(c).
Since my last report on July 8, 1988, 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 (``the Office'') of the
Department of the Treasury. Additionally, since July 8, 1988, there have been
no amendments or changes to orders of the Department of Commerce or the
Department of Transportation implementing aspects of Executive Order No. 12543
relating to exports from the United States and air transportation,
During the current 6-month period, the Office has issued licenses to
individuals and corporations to permit them to engage in activities that would
otherwise be prohibited by the Regulations. Under the Office's licensing
procedures, 12 individuals registered to remain in Libya with Libyan immediate
family members. Four licenses were extended authorizing transactions in
connection with U.S. persons' filings or
renewals of Libyan patents, copyrights, and trademarks. The Office also issued
licenses to Bankers Trust Company, Manufacturers Hanover Trust Company, and the
Bank of America authorizing the debiting of certain Libyan accounts held by
their London branches. Finally, the
Office licensed a service contractor that had been operating in Libya prior to the imposition
of the Libyan sanctions to sell certain of its equipment in Libya to a Libyan purchaser.
Various enforcement actions mentioned in previous reports continue to be
pursued. In June 1988, the U.S. Customs Service seized a shipment of canned
tuna valued at $430,600 for an attempted transshipment to Libya through the United States from Mexico. In July 1988, a U.S. national, facing
criminal charges for repeated visits to Libya to work in the oil
industry, paid a $5,000 civil penalty and signed a consent agreement that he
would refrain from travel to Libya. This marked the first
instance of an independent civil penalty being imposed under the Regulations.
October and November 1988, six Libyan nationals pleaded guilty to counts of
conspiring to violate IEEPA based on a scheme to divert funds intended for a
Libyan student organization into intelligence-gathering activities and
anti-American demonstrations and conferences. One of the Libyan nationals also
pleaded guilty to a substantive violation of IEEPA.
latter defendant received a sentence of 5 years' imprisonment and a separate
suspended sentence with 10 years' parole, while the other coconspirators
received suspended sentences and deportation orders. A total of $600,300 in
fines was paid in this enforcement action.
In October 1988, the United States Court of Appeals for the Federal Circuit
affirmed a Claims Court order dismissing an
action by five American petroleum engineers. The Court found that the
imposition of the Libyan sanctions was not a taking of the engineers'
employment contracts with a Libyan oil company and did not violate the Fifth
Amendment to the United States Constitution. Chang v. United
States, No. 88 - 1120 (Oct.
13, 1988), aff'g 13 Cl. Ct. 555
cases are pending in an English court, involving claims by Libya seeking the release of
funds blocked in the London branches of Bankers
Trust Company and Manufacturers Hanover Trust Company. The United States
Government is not a party to these cases, but is closely monitoring the
proceedings. Hearings in one of these cases are scheduled to commerce on January
The expenses incurred by the Federal Government in the 6-month period from July
through the present time that are directly attributable to the exercise of
powers and authorities conferred by the declaration of the Libyan national
emergency are estimated at $461,745. Personnel costs were largely centered in
the Department of the Treasury (particularly in the Office of Foreign Assets
Control, the Customs Service, the Office of the Assistant Secretary for
Enforcement, the Office of the Assistant Secretary for International Affairs,
and the Office of the General Counsel), the Department of State, the Department
of Commerce, the Department of Justice, the Federal Reserve Board, and the
National Security Council.
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. I shall continue to
exercise the powers at my disposal to apply economic sanctions against Libya as
long as these measures are appropriate and will continue to report periodically
to the Congress on significant developments, pursuant to 50 U.S.C. 1703(c).
Note: Identical letters
were sent to Jim Wright, Speaker of the House of Representatives, and George
Bush, President of the Senate.