The House of Representatives has passed legislation authorizing state and local governments to divest from companies doing business with Iran’s energy sector. The Iran Sanctions Enabling Act, sponsored by Reps. Barney Frank (D-Mass.) and Mark Kirk (R-Ill.), passed by a vote of 414-6 on Wednesday.
The legislation allows for state and local governments to divest from companies that invest in Iran’s petroleum and natural gas industries or do business with Iran’s nuclear industry, It also provides for divestment from any company providing tankers or any product used to construct or maintain pipelines that transport Iranian oil or liquefied natural gas, as well as any financial institution that offers a $20 million line of credit to anyone investing in Iran’s energy sector. The bill would protect fund managers who divest from such companies from possible lawsuits.
Similiar legislation has been introduced in the Senate. President Obama, when he was a senator, was the lead sponsor of an Senate version of the bill in 2008, although the White House has not yet taken a position on the bill.
"Several international firms continue to subsidize Iran’s nuclear ambitions by investing billions of dollars in the regime’s energy sector," said Kirk. "While some states like Illinois have taken steps to divest from Iran, many states and local communities need some encouragement. This legislation gives a strong ‘go signal’ to state and local leaders around America to get out of Iran."
Given that companies investing in Iran’s oil and gas sector account for 80% of Iran’s hard currency, this bill has the potential to make Iran pay a steep economic price for its continuing defiance of the international community," said AIPAC in a statement. "Tough steps such as cutting off the flow of cash to the regime could help convince Iran it faces a bleak economic future and growing domestic unrest unless it changes course."
The full Kirk and AIPAC statements are after the jump:[[READMORE]]
First, Kirk:
The House of Representatives today passed H.R. 1327, the Iran Sanctions Enabling Act of 2009, sponsored by U.S. Reps. Barney Frank (D-Mass.) and Mark Kirk (R-Ill.). The legislation, which would authorize state and local governments to divest from firms with investments of $20 million or more in Iran’s oil and gas sectors, now moves to the Senate for further consideration.
"Several international firms continue to subsidize Iran’s nuclear ambitions by investing billions of dollars in the regime’s energy sector," said Kirk, co-chair of the bipartisan Iran Working Group and a Navy Reserve intelligence officer. "While some states like Illinois have taken steps to divest from Iran, many states and local communities need some encouragement. This legislation gives a strong ‘go signal’ to state and local leaders around America to get out of Iran."
Arizona, California, Florida, Georgia, Illinois, Louisiana, Maryland, Michigan, Indiana, New Jersey, Colorado, New York, Ohio, Texas, and Washington have all enacted some form of divestment laws. According to the Congressional Research Service, at least 20 international corporations invest heavily in Iran’s oil and gas sectors.
Iran continues to enrich uranium in violation of U.N. Security Council resolutions and its commitment under the Nuclear Non-Proliferation Treaty. Earlier this month, the U.S. Administration revealed the existence of a secret underground uranium enrichment facility near Qom, Iran.
"For diplomacy to succeed, we must provide our diplomats more tools for their diplomatic toolbox," said Kirk, the architect of legislation to restrict the flow of gasoline to Iran. "The Iran Sanctions Enabling Act is a good first step – but it cannot be the last. I urge Speaker Pelosi to move H.R. 2194, the Iran Refined Petroleum Sanctions Act, to the floor for immediate consideration."
H.R. 2194, modeled after Kirk’s Iran Sanctions Enhancement Act of 2007 and Iran Diplomatic Enhancement Act of 2009, would extend current sanctions to companies that supply gasoline to Iran. Despite its status as a top oil-producing nation, Iran remains heavily dependent on foreign gasoline imports – a key economic weakness.
And AIPAC:
AIPAC applauds the House of Representatives’ passage of the Iran Sanctions Enabling Act of 2009, authorizing state and local governments to divest from companies investing in Iran’s petroleum and natural gas sector or doing business with Iran’s nuclear industry.
The bill also provides for divestment from any company providing tankers or any product used to construct or maintain pipelines that transport Iranian oil or liquefied natural gas, and targets any financial institution that extends $20m or more in credit to any entity investing in Iran’s energy sector.
The Iran Sanctions Enabling Act of 2009 (H.R. 1327) passed the House by a vote of 414 to 6. A companion bill (S.1065) has been introduced in the Senate by Senators Robert Casey (D-PA) and Sam Brownback (R-KS). AIPAC commends those House Members who voted in support of the bill and recognizes the leadership displayed by the bill’s principal co-sponsors Reps. Barney Frank (D-MA) and Mark Kirk (R-IL).
Iran’s continued defiance of repeated U.N. Security Council resolutions demanding immediate suspension of Tehran’s nuclear fuel work, and Tehran’s failure to meet international obligations – to immediately stop enriching, come completely clean about its illicit nuclear program and open up to late-notice inspections anywhere, anytime — calls for concerted and forceful sanctions to compel Iran to change its behavior.
Since these companies are already liable for sanctions under U.S. law (see Iran Sanctions Act), states have a fiduciary responsibility to consider the financial consequences of holding stock in them. The law also protects fund managers who divest from such companies from potential lawsuits.
By passing this important piece of legislation, Congress is aiming to deprive Iran of the money it needs to pursue a nuclear weapons capability, ratcheting up pressure on those who are financing Tehran’s nuclear pursuits through there investments and support to Iran’s petroleum and natural gas industry.
Facing the urgent and time sensitive need to change Iranian behavior or face even more difficult choices, the United States and our allies must to exhaust every economic, diplomatic and political tool to pressure and persuade the Iranian government to end its illicit nuclear program as the U.N. Security Council and the International Community have repeatedly demanded.
Given that companies investing in Iran’s oil and gas sector account for 80% of Iran’s hard currency, this bill has the potential to make Iran pay a steep economic price for its continuing defiance of the international community. Tough steps such as cutting off the flow of cash to the regime could help convince Iran it faces a bleak economic future and growing domestic unrest unless it changes course.
