transferring Iraq's assets
Source Eubulides
Date 03/11/24/11:57

Federal Register: November 24, 2003 (Volume 68, Number 226)]
[Rules and Regulations]
[Page 65844-65845]
From the Federal Register Online via GPO Access []



Office of Foreign Assets Control

31 CFR Part 575

Authorization for U.S. Financial Institutions To Transfer Certain
Claims Against the Government of Iraq

AGENCY: Office of Foreign Assets Control, Treasury.

ACTION: Interim final rule.


SUMMARY: The Office of Foreign Assets Control (``OFAC'') of the
Department of the Treasury is amending the Iraqi Sanctions Regulations
to incorporate a general license authorizing U.S. financial
institutions to transfer certain claims against the Government of Iraq
for unpaid loans and other debts to their home offices or to other
foreign offices of the same institution.

DATES: Effective September 30, 2003. Written comments must be received
no later than January 23, 2004.

ADDRESSES: Comments may be submitted to the Chief of Records, ATTN:
Request for Comments, Office of Foreign Assets Control, Department of
the Treasury, 1500 Pennsylvania Avenue, NW., Washington, DC 20220.
Alternatively, comments may be submitted via facsimile to the Chief of
Records at 202/622-1657 or via OFAC's Web site

FOR FURTHER INFORMATION CONTACT: OFAC's Chief of Licensing, tel. 202/
622-2480, Chief of Policy Planning and Program Management, tel. 202/
622-2500, or Chief Counsel, tel. 202/622-2410.



    On August 2, 1990, the President issued Executive Order 12722,
declaring a national emergency with respect to Iraq. This order was
issued under the authority of, inter alia, the International Emergency
Economic Powers Act (50 U.S.C. 1701 et seq.), the National Emergencies
Act (50 U.S.C. 1601 et seq.), and section 301 of title 3 of the U.S.
Code and imposed economic sanctions, including a complete trade
embargo, with respect to Iraq. In keeping with United Nations Security
Council Resolution 661 of August 6, 1990, and under the United Nations
Participation Act (22 U.S.C. 287c), the President also issued Executive
Order 12724 of August 9, 1990, which imposed additional restrictions.
The Iraqi Sanctions Regulations, 31 CFR part 575 (the ``Regulations''),
implement Executive Orders 12722 and 12724 and are administered by the
Treasury Department's Office of Foreign Assets Control (``OFAC'').
    On May 22, 2003, the United Nations Security Council adopted
Resolution 1483, which substantially lifted the multilateral economic
sanctions with respect to Iraq. On May 23, 2003, OFAC issued a general
license that reflected Resolution 1483 by authorizing most transactions
that had been prohibited by the Regulations. This general license was
published in the Federal Register on June 27, 2003, as section 575.533
of the Regulations (68 FR 38188-38190). Section 575.533 of the
Regulations contained four exceptions to the broad lifting of
sanctions, including a provision that ``[a]ll property and interests in
property that were blocked * * * as of the effective date of this
section [i.e., May 23, 2003] remain blocked * * *.''
    On September 30, 2003, OFAC issued another general license that is
being published today as new section 575.534 of the Regulations. New
section 575.534 provides a limited authorization for U.S. financial
institutions to transfer a category of blocked property and interests
in property--i.e., their ``claims that were booked in the United States
as of May 23, 2003, against the Government of Iraq for unpaid loans and
other debts''--to their home offices or to other foreign offices of the
same institution. This new section authorizes only the transfer of
claims under the circumstances described and does not authorize the
debiting of any blocked account.

Request for Comments

    Because these regulations involve a foreign affairs function, the
provisions of Executive Order 12866 and the Administrative Procedure
Act (5 U.S.C. 553) (the ``APA'') requiring notice of proposed
rulemaking, opportunity for public participation, and delay in
effective date, are inapplicable. However, because of the importance of
the issues addressed in these regulations, they are being issued in
interim form and comments will be considered in the development of a
final rule. Accordingly, OFAC encourages interested persons who wish to
comment to do so at the earliest possible time to permit the fullest
consideration of their views. Comments may address the impact of the
regulations on the submitter's activities, whether of a commercial,
non-commercial or humanitarian nature, as well as changes that would
improve the clarity and organization of the regulations.
    The period for submission of comments will close January 23, 2004.
The address for submitting comments appears near the beginning of this
document. OFAC will consider all comments received before the close of
the comment period in developing final regulations. Comments received
after the end of the comment period will be considered if possible, but
their consideration cannot be assured. OFAC will not accept public
comments accompanied by a request that a part or all of the submission
be treated confidentially because of its business proprietary nature or
for any other reason. OFAC will return such a submission to the
originator without considering the comments in the development of final
regulations. In the interest of accuracy and completeness, OFAC
requires comments in written form.
    All public comments on these regulations will be a matter of public
record. Copies of the public record concerning these regulations will
be made available not sooner than February 23, 2004 and will be
obtainable from OFAC's Web site If that service is unavailable, written requests for copies may be sent
to Office of Foreign Assets Control, U.S. Department of the Treasury,
1500 Pennsylvania Ave., NW., Washington, DC 20220, Attn: Chief, Records

Electronic Availability

    This document is available as an electronic file on The Federal
Bulletin Board the day of publication in the Federal Register. By
modem, dial 202/512-1387 and type ``/GO FAC,'' or call 202/512-1530 for
disk or paper copies. This file is available for downloading without
charge in ASCII and Adobe Acrobat readable (*.PDF) formats. For
Internet access, the address for use with the World Wide Web, Telnet,
or FTP protocol is . This document and
additional information concerning OFAC are available from OFAC's Web

Paperwork Reduction Act

    The collections of information related to these regulations can be
found in 31 CFR part 501. Pursuant to the Paperwork Reduction Act of
1995 (44 U.S.C. 3507), those collections of information have been
previously approved by the Office of Management and Budget under
control number 1505-0164.

List of Subjects in 31 CFR Part 575

    Administrative practice and procedure, Banks, banking, Blocking of
assets, Exports, Foreign trade,

Humanitarian aid, Imports, Iran, Iraq, Oil imports, Penalties,
Petroleum, Petroleum products, Reporting and recordkeeping
requirements, Specially designated nationals, Terrorism, Travel

For the reasons stated in the preamble, 31 CFR part 575 is amended as
set forth below:


1. The authority citation for 31 CFR part 575 continues to read as

    Authority: 3 U.S.C. 301; 18 U.S.C. 2332d; 22 U.S.C. 287c; Pub.
L. 101-410, 104 Stat. 890 (28 U.S.C. 2461 note); 31 U.S.C. 321(b);
50 U.S.C. 1601-1651, 1701-1706; Pub. L. 101-513, 104 Stat. 2047-2055
(50 U.S.C. 1701 note); E.O. 12722, 55 FR 31803, 3 CFR, 1990 Comp.,
p. 294; E.O. 12724, 55 FR 33089, 3 CFR, 1990 Comp., p. 297; E.O.
12817, 57 FR 48433, 3 CFR, 1992 Comp., p. 317; E.O. 13290, 68 FR
14307, March 20, 2003.

Subpart E--Licenses, Authorizations, and Statements of Licensing

2. Add a new Sec.  575.534 to subpart E to read as follows:

Sec.  575.534  Transfers of certain blocked claims by U.S. financial

    U.S. financial institutions are authorized to transfer claims that
were booked in the United States as of May 23, 2003, against the
Government of Iraq for unpaid loans and other debts to their home
offices or to other foreign offices of the same institution. This
section authorizes only the transfer of claims and does not authorize
the debiting of any blocked account.

    Dated: September 30, 2003.
R. Richard Newcomb,
Director, Office of Foreign Assets Control.
    Approved: October 15, 2003.
Juan C. Zarate,
Deputy Assistant Secretary (Terrorist Financing and Financial Crimes),
Department of the Treasury.
[FR Doc. 03-29237 Filed 11-19-03; 2:59 pm]


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