Download Locations

• Open CRS (User submitted)

Summary

Iran is subject to a wide range of U.S. sanctions, restricting trade with, investment, and U.S. foreign aid to Iran, and requiring the United States to vote against international lending to Iran. Several laws and Executive Orders authorize sanctions against foreign companies that do business with Iran, as part of an effort to persuade foreign firms to choose between the Iranian market and the much larger U.S. market. A formal U.S. effort to curb international energy investment in Iran began in 1996 with the Iran Sanctions Act (ISA). No firms have been sanctioned under it and the precise effects of that law on energy investment in Iran--as separate from other factors affecting international firms' decisions on whether to invest in Iran--has been unclear. While international pressure on Iran to curb its nuclear program has increased the hesitation of many major foreign firms to invest in Iran's energy sector, hindering Iran's efforts to expand oil production beyond 4.1 million barrels per day, some firms continue to see opportunity in Iran. This particularly appears to be the case for companies in Asia that appear eager to fill the void left by major European and American firms and to line up steady supplies of Iranian oil and gas. ISA was first passed at a time of tightening U.S. sanctions on Iran. Most notable was a 1995 ban on U.S. trade with and investment in Iran. That ban has since been modified slightly to allow for some bilateral trade in luxury and humanitarian-related goods. Foreign subsidiaries of U.S. firms remain generally exempt from the trade ban since they are under the laws of the countries where they are incorporated. Since 1995, several laws and regulations that seek to pressure Iran's economy, curb Iran's support for militant groups, and curtail supplies to Iran of advanced technology have been enacted. In the United States, there has been movement on the part of some U.S. states to divest from firms that do business with Iran, even if such trade is legal. In the 111th Congress, as many in Congress express concern about the reticence of U.S. allies, of Russia, and of China, to impose very strict economic sanctions on Iran, several bills would add sanctions on Iran. For example, H.R. 2194, H.R. 1985, H.R. 1208, and S. 908 would include as ISA violations: selling refined gasoline to Iran; providing shipping insurance or other services to deliver gasoline to Iran; or supplying equipment to or performing the construction of oil refineries in Iran. H.R. 2192 and S. 908 would also expand the menu of available sanctions against violators. H.R. 1208 would further restrict trade with Iran. For more on Iran, see CRS Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman.

Related Legislation:
• H.R.2194
• H.R.1985
• H.R.1208
• S.908
• H.R.2192

XML

Share this report