E8-28711. Iranian Transactions Regulations

AGENCY:

Office of Foreign Assets Control, Treasury.

ACTION:

Final rule.

SUMMARY:

The Department of the Treasury's Office of Foreign Assets Control (“OFAC”) is amending the Iranian Transactions Regulations to expand the scope of Appendix A to Part 560 to include non-financial as well as financial institutions determined to be owned or controlled by the Government of Iran, and to add to the appendix three non-financial institutions that have been determined to be owned or controlled by the Government of Iran: The National Iranian Oil Company (a.k.a. NIOC), Naftiran Intertrade Company Ltd (a.k.a. NICO), and Naftiran Intertrade Co. (NICO) Sarl.

DATES:

Effective Date: December 3, 2008.

FOR FURTHER INFORMATION CONTACT:

Assistant Director for Compliance, Outreach & Implementation, tel.: [phone], Assistant Director for Licensing, tel.: [phone], Assistant Director for Policy, tel.: [phone], Office of Foreign Assets Control, or Chief Counsel (Foreign Assets Control), tel.: [phone], Office of the General Counsel, Department of the Treasury, Washington, DC 20220 (not toll free numbers).

SUPPLEMENTARY INFORMATION:

Electronic and Facsimile Availability

This document and additional information concerning OFAC are available from OFAC's Web site (http://www.treas.gov/​ofac) or via facsimile through a 24-hour fax-on demand service, tel.: [phone].

Background

The Iranian Transactions Regulations, 31 CFR part 560 (the “ITR”), implement a series of Executive orders that began with Executive Order 12613, which was issued on October 29, 1987, pursuant to authorities including the International Security and Development Cooperation Act of 1985 (22 U.S.C. 2349aa-9). In that Order, after finding, inter alia, that the Government of Iran was actively supporting terrorism as an instrument of state policy, the President prohibited the importation of Iranian-origin goods and services. Subsequently, in Executive Order 12957, issued on March 15, 1995, under the authority of, inter alia, the International Emergency Economic Powers Act (50 U.S.C. 1701-1706) (“IEEPA”), the President declared a national emergency with respect to the actions and policies of the Government of Iran, including its support for international terrorism, its efforts to undermine the Middle East peace process, and its efforts to acquire weapons of mass destruction and the means to deliver them. To deal with that threat, Executive Order 12957 imposed prohibitions on certain transactions with respect to the development of Iranian petroleum resources. On May 6, 1995, to further respond to this threat, the President issued Executive Order 12959, which imposed comprehensive trade and financial sanctions on Iran. Finally, on August 19, 1997, the President issued Executive Order 13059 consolidating and clarifying the previous orders.

The ITR implement these Executive orders and prohibit various transactions, including, among others, transactions with the Government of Iran, a term defined in § 560.304 to include any entity owned or controlled by the Government of Iran, which is a term that is itself defined in § 560.313 of the ITR. Since its initial publication in 1999, Appendix A to Part 560 has listed financial institutions that OFAC determined to be entities owned or controlled by the Government of Iran, within the meaning of §§ 560.304 and 560.313 of the ITR. This appendix is intended to assist U.S. persons in complying with the ITR. OFAC is expanding the scope of appendix A to include all categories of entities, not just financial institutions. This change will allow OFAC to give notice when it determines that any entity is owned or controlled by the Government of Iran.

OFAC is expanding the scope of appendix A today in order to add the National Iranian Oil Company (a.k.a. NIOC), Naftiran Intertrade Company Ltd (a.k.a. NICO), and Naftiran Intertrade Co. (NICO) Sarl to the appendix as entities that are owned or controlled by the Government of Iran within the meaning of §§ 560.304 and 560.313 of the ITR. The ITR prohibit most transactions with any entity, wherever located, that is owned or controlled by the Government of Iran.

It is important to note that Appendix A to Part 560 is not a comprehensive list of entities owned or controlled by the Government of Iran. Even if an entity is not listed in appendix A, if it is owned or controlled by the Government of Iran, U.S. persons are prohibited from engaging in transactions with that entity, in any of its locations worldwide, to the same extent that U.S. persons are prohibited from engaging in transactions with the entities listed in appendix A. A U.S. person also is prohibited from engaging in most transactions with entities located in Iran that are not owned or controlled by the Government of Iran. Finally, please be aware that certain entities listed in Appendix A to Part 560 may be subject to further sanctions under other sanctions programs.

Public Participation

Because the amendment of the ITR involves a foreign affairs function, the provisions of Executive Order 12866 and the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, opportunity for public participation, and delay in effective date are inapplicable. Because no notice of proposed rulemaking is required for this rule, the Regulatory Flexibility Act (5 U.S.C. 601-612) does not apply.

Paperwork Reduction Act

The collections of information related to the ITR are contained in 31 CFR part 501 (the “Reporting, Procedures and Penalties Regulations”). Pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3507), those collections of information have been approved by the Office of Management and Budget under control number 1505-0164. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid control number.

List of Subjects in 31 CFR Part 560

• Administrative practice and procedure
• Banks
• Banking
• Brokers
• Foreign trade
• Investments
• Loans
• Securities
• Iran

For the reasons set forth in the preamble, the Office of Foreign Assets Control amends 31 CFR part 560 as follows:

PART 560—IRANIAN TRANSACTIONS REGULATIONS

1. The authority citation of part 560 continues to read as follows:

Authority: 3 U.S.C. 301; 18 U.S.C. 2339B, 2332d; 22 U.S.C. 2349aa-9; 31 U.S.C. 321(b); 50 U.S.C. 1601-1651, 1701-1706; Pub. L. 101-410, 104 Stat. 890 (28 U.S.C. 2461 note); Pub. L. 106-387, 114 Stat. 1549; Pub. L. 110-96, 121 Stat. 1011; E.O. 12613, 52 FR 41940, 3 CFR, 1987 Comp., p. 256; E.O. 12957, 60 FR 14615, 3 CFR, 1995 Comp., p. 332; E.O. 12959, 60 FR 24757, 3 CFR, 1995 Comp., p. 356; E.O. 13059, 62 FR 44531, 3 CFR, 1997 Comp., p. 217.

2. Amend Appendix A to Part 560 by revising the heading and introductory text, as well as redesignating paragraphs 19 and 20 as 22 and 23, respectively, and adding new paragraphs 19, 20, and 21, to read as follows:

Appendix A to Part 560—Entities Determined To Be Owned or Controlled by the Government of Iran

This non-exhaustive appendix lists entities determined by the Office of Foreign Assets Control (“OFAC”) to be entities owned or controlled by the Government of Iran within the meaning of §§ 560.304 and 560.313 of this part 560. The entities listed below are considered to be entities owned or controlled by the Government of Iran when they operate not only from the locations listed below, but also from any other location. The names and addresses are subject to change. This part 560 contains prohibitions against engaging in most transactions with entities owned or controlled by the Government of Iran, whether such entities are located or incorporated inside or outside of Iran. Moreover, regardless of whether an entity is listed below, if the entity is owned or controlled by the Government of Iran, the prohibitions on engaging in transactions with the entity, wherever located worldwide, apply to the same extent they would apply if the entity were listed in this appendix. Note that the prohibitions in this part 560 also apply to transactions with entities located in Iran that are not owned or controlled by the Government of Iran. Finally, please be aware that certain entities listed in this appendix may be subject to further sanctions under other sanctions programs.

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19. NATIONAL IRANIAN OIL COMPANY, (a.k.a. NIOC) Hafez Crossing, Taleghani Avenue, P.O. Box 1863 and 2501, Tehran, Iran

20. NAFTIRAN INTERTRADE COMPANY LTD, (a.k.a. NICO); a.k.a. Naft Iran Intertrade Ltd, 22 Grenville St, St Helier, Jersey Channel Islands JE4 8PX, United Kingdom; 22 Grenville St, St Helier, Jersey, Channel Islands JE2 4UF, United Kingdom; 5th floor, Petro Pars Building, Saadat Abad Avenue, No. 35, Farhang Blvd, Tehran, Iran

21. NAFTIRAN INTERTRADE CO. (NICO) Sarl, 6, Avenue de la Tour Haldimand, 1009 Pully, VD, Switzerland

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Barbara C. Hammerle,

Acting Director, Office of Foreign Assets Control.