The Clinton administration’s decision to defer sanctions against a French energy firm that signed a multibillion dollar gas deal with Iran has raised serious concerns among Jewish groups.
Faced with trenchant opposition from the European Union, the administration decided to delay imposing sanctions required by a 1996 U.S. law against any company that invests more than $40 million a year in Iran’s energy sector.
The Iran-Libya Sanctions Act provides for punitive trade measures to curb investments that the U.S. believes would give Iran funds to acquire weapons or promote terrorism.
Total, the French oil and gas company, announced last month that it had joined the Russian gas giant Gazprom and the Malaysian state oil company Petronas in a $2 billion deal to develop the Iranian offshore gas field known as South Pars.
The move touched off a dispute between the United States and France, which warned that it would stand by the deal. The 15-member European Union later chimed in, presenting a united front in opposing any attempt to apply U.S. law to foreign companies.
In response, the Clinton administration has indicated that it may waive sanctions against Total and exempt all companies based in E.U. member countries from the law provided that Europe adopts measures aimed at demonstrating its support for other U.S. efforts to contain Iran.
The proposal has met with criticism from some proponents of the sanctions law, including Jewish officials, who see the waiver as a threat to U.S. credibility.
“What is at stake here is the entire policy of containment of Iran,” a senior official of a pro-Israel organization said. “American credibility is being tested, and if at the first test the U.S. backs down, the Iranians and the big companies will consider that our sanctions were only a bluff.”
Jason Isaacson, Washington director of the American Jewish Committee, said: “We are looking for signs of very firm American action to prevent the realization of Iran’s weapons development and nuclear ambitions. We have been encouraged by some signals in the past, but this is the time to see very clear action, very decisive action by the administration.”
In a letter to President Clinton, Rep. Benjamin Gilman (R-N.Y.), chairman of the House International Relations Committee, and Sen. Alfonse D’Amato (R-N.Y.), principal sponsor of the sanctions law, urged Clinton to hold firm and slap sanctions on Total.
“If the United States does not take swift, decisive action to apply these available sanctions, we will undercut our long-standing policy against Iranian terrorism,” they wrote.
“Dozens of foreign companies are watching our reaction to the Total deal. If we do not sanction Total as” a violator of the Iran-Libya Sanctions Act “it is likely that foreign investment will pour into Iran’s oil and gas fields.”
The controversy comes amid reports that Iran, with the help of Russian technology, is accelerating development of a new ballistic missile capable of delivering chemical, biological and other warheads to Israel and other states in the region.
Maj. Gen. Ze’ev Livneh, the Israeli military attache in Washington, said this week that Iran has successfully tested the engines of a new long-range missile with a range of about 800 miles and that it could become operational within 12 to 18 months.
The State Department, meanwhile, announced this week that U.S. experts will soon visit France, Russia and Malaysia as part of a U.S. probe to determine if sanctions are called for in connection with the Total deal.
“We are actively investigating this case to determine whether sanctionable activity has occurred,” State Department spokesman James Rubin said. “I’m not going to anticipate the results of our review or speculate about what decisions we will make.”
The European Union has set an Oct. 15 deadline for reaching a compromise with Washington over sanctions. If no deal is reached, the European Union is threatening to challenge the U.S. law at the World Trade Organization.
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