Aware that Iran cannot sponsor terrorism without money, Congress has taken steps to try to end European investment in the state’s lucrative petroleum industry.
The House of Representatives unanimously passed a measure Wednesday, 415-0, that in effect imposes a U.S. government boycott on all overseas companies that invest in Iran’s decaying oil fields and refineries.
The Senate was expected to follow suit as early as this week.
The measure was hailed by the American Israel Public Affairs Committee as “one of the most important pieces of legislation in years.”
It would force foreign firms to choose between doing business with Iran or the United States.
Under the threat of the legislation, at least four European companies have backed away from planned deals with Iran worth more than a total of $10 billion.
The measure also imposes sanctions on international firms selling oil technology to Libya.
President Clinton banned American firms from trading with Iran year. White House officials said Clinton would sign the measure known as the Iran Foreign Oil Sanctions Act.
By cutting off money to Iran’s energy industry, supporters of the bill hope that the cash squeeze will curtail the militant Islamic regime’s support for terrorism.
“You need money to get the infrastructure to develop a nuclear weapon,” an AIPAC official said. This measure goes a long way toward “depriving Iran with the resources necessary to obtain a nuclear weapon and continue support for terrorism.”
Highlighting the importance of the bill, an AIPAC official said, “This is a vote which AIPAC will follow very closely.”
AIPAC does not formally rate members of Congress but maintains extensive records of how lawmakers vote on bills deemed to be pro-Israel, including foreign aid and arms sales.
Under the legislation, if a foreign company invests more than $40 million annually in Iran’s oil sector, the U.S. president must impose any two of six sanctions mandated by the legislation.
The leveling of such sanctions would amount to a de facto boycott.
The sanctions include denying the firm U.S. government loans and credits, banning the company from bidding for U.S. government contracts, preventing the firm from receiving export licenses to ship goods to the United States and blocking loans from U.S. banks.
In addition, financial institutions could lose eligibility to receive U.S. government deposits and trade in debt instruments, including U.S. government bonds.
The president could waive the sanctions if he determines that it is in the national interest of the United States.