March 11, 2010

After Gillibrand’s Urging, Senate Leaders Take Steps To Pass New Sanctions On Iran

Gillibrand Praises Leadership For Moving Forward On Efforts to Cut Ties With Companies That Do Business With Iran, Enforce Tougher Penalties Against Company Offenders

Washington, DC – At the urging of U.S. Senate Kirsten Gillibrand, a member of the Senate Foreign Relations Committee, Senate leaders today moved forward on efforts to pass new legislation to strengthen sanctions and checks against companies tied to Iran, including blocking federal contracts to violators and imposing a three year ban on government contracts against companies who falsely claim they do not conduct business with Iran’s energy sector.

On Monday, Senator Gillibrand sent a letter to Majority Leader Reid urging him to move forward on the legislation.  Today he appointed a conference committee, including Senators Chris Dodd (D-CT), John Kerry, (D-MA), Joseph Lieberman (I-CT), Robert Menendez (D-NJ), Richard Shelby (R-AL), Bob Bennett (R-UT) and Richard Lugar (R-IN).

Senator Gillibrand issued the following statement praising Senate leaders for the move:

“There is a true sense of urgency that we must shut down Iran’s financing of its nuclear weapons program as soon as possible. The more that Iran can invest in nuclear weapons, the more danger Americans face.

“I want to thank the bipartisan group of Senate leaders for coming together to take quick action that will strengthen the President’s ability to crack down on companies doing business with Iran and curb the dangerous country’s growth.

“These sanctions will show Iran that until they halt their nuclear development, they will not have any access to the global economy, and neither will any company doing business with Iran.”

After a recent analysis revealed that companies that do business with Iran’s energy sector defied U.S. sanctions law by raking in tens of billions of dollars in federal contracts and loans, U.S. Senator Kirsten Gillibrand, a member of the Senate Foreign Relations Committee, called for immediate passage of federal law that would allow President Obama to impose tougher sanctions and checks against companies tied to Iran, including blocking federal contracts to violators and imposing a three year ban on government contracts against companies who falsely claim they do not conduct business with Iran.

In a letter to Senate Majority Leader Harry Reid on Monday, Senator Gillibrand called for immediate action to move both the Senate and House versions of the Iran sanctions bill through conference committee and onto the President’s desk. Senator Gillibrand urged Majority Leader Reid to encourage colleagues in conference to adopt the stronger House bill which prohibits government contracts to foreign companies and foreign subsidiaries of American companies that do business with Iran and requires firms to officially certify that they do not invest in Iran. Under the House bill, the federal government would impose a three year ban on government contracts against companies who falsely certify, deny companies U.S. bank loans, and restrict violators from importing goods. 

A New York Times report revealed that $107.8 billion in federal contracts, grants and loans were awarded to companies who were doing business with Iran – $14.8 billion of which were given to companies whose investments in Iran’s energy sector violated the Iran Sanctions Act. According to the report, there are currently 49 companies that continue to do business with Iran.   

Last year, Senator Gillibrand pushed for legislation to be included in the Iran sanctions bill which targets companies that support Iran’s economy and authorizes stronger penalties against these firms.

The full text of Senator Gillibrand’s letter to Senate Majority Leader Harry Reid is below:

The Honorable Harry Reid
Majority Leader
United States Senate
522 Hart Senate Office Building
Washington, DC 20510

Dear Leader Reid,

I am very troubled by the report in the Sunday edition of the New York Times that the federal government has awarded more than $107 billion in contract benefits over the past decade to companies doing business in Iran, including nearly $15 billion paid to companies that apparently violated U.S. sanctions by making large investments that helped Iran develop its oil and gas reserves. 

The Senate and House have passed companion measures that would significantly increase sanctions on companies helping Iran develop its refined petroleum sector, S. 2799 and H.R. 2194.  Specifically addressing the astounding revelations in the newspaper, these bills would prohibit U.S. government contracts with persons or companies that violate the investment and sale activity covered by these bills.  We must move these bills to conference right away to demonstrate our resolve and provide the President with a more robust set of tools to address Iran's nuclear threat.  Once in conference, I would request that you instruct conferees to use the House approach to the prohibition of government contracts.  It appears to me to be the stronger of the two, given that it requires a contract applicant to certify that it does not conduct prohibited activity and provides for a three-year ban on government contracts for making a false certification. 

With its nuclear weapons program, Iran poses an existential threat to our close allies such as Israel.  Yet, Iran's government has defied the international community's repeated offers to address the country's energy needs in return for giving up efforts to build a nuclear bomb.  President Obama has made remarkable strides toward advancing international consensus regarding Iran.  But it is time to bolster engagement with sanctions that make an impact on Iran's decision makers. And, it is certainly time to send a strong message to companies that do business with Iran's rulers - they must choose between doing business with a rogue state and the U.S. government.

Thank you for your leadership in passing S.2799.  I hope we have the opportunity to vote on a final bill in the near future.