Memo: The Iran Nuclear Agreement Review Act and Its Implications for U.S. Sanctions Policy
On April 14th, the Senate Foreign Relations Committee voted an amended version of the Iran Nuclear Agreement Review Act, S. 615 (the “Corker-Menendez bill”) out of committee. The legislation, which provides for Congressional review and oversight of any comprehensive nuclear deal reached with Iran, will now head to the Senate floor. President Obama has signaled that he would be prepared to sign the bill into law if passed in its current iteration.
However, there is much confusion as to what the proposed legislation actually does. This memo is intended to provide an overview of the provisions of the bill; various possible scenarios that may arise should a nuclear deal be agreed to between the United States, its P5+1 partners, and Iran; and what Presidential authorities would survive to relieve sanctions on Iran should Congress enact a Joint Resolution of Disapproval pursuant to the legislation.
What the Iran Nuclear Agreement Review Act Does
Generally speaking, the Iran Nuclear Agreement Review Act is being offered as an oversight bill. It establishes a time-limited process for Congress to review a comprehensive nuclear deal reached with Iran and institutes a series of reporting requirements regarding Iran’s compliance with the terms of a deal that the President must submit to Congress every 90 days. Moreover, the Act provides for expedited procedures by which Congress can re-impose sanctions on Iran should Iran be found in material breach of its obligations under a comprehensive nuclear deal.
However, the legislation exceeds the scope of oversight by withdrawing from the President the power to implement a nuclear deal reached with Iran, both during the period of Congressional review and thereafter should Congress enact a Joint Resolution of Disapproval. It does this by prohibiting the President from “waiving, suspending, reducing, providing relief from, or otherwise limiting the application of statutory sanctions with respect to Iran under any provision of law or refraining from applying any such sanctions pursuant to an agreement.” This prohibition is intended to permit Congress to review a nuclear deal prior to its implementation and to prohibit the President from unilaterally committing the United States to a nuclear deal should Congress disapprove of that deal by a margin wide enough to override what is a certain Presidential veto.
The constituent parts of the Iran Nuclear Agreement Review Act include:
Under the proposed legislation, the President is obligated to transmit the text of an agreement reached with Iran and relating to Iran’s nuclear program to Congress, along with a verification assessment report and certification by the President that the agreement contains all material elements of a nuclear deal, no later than 5 calendar days following the conclusion of a deal.
Following the President’s submission of the text of an agreement to Congress, Congress will have 30-calendar days to review the agreement. However, if the President submits an agreement to Congress between July 10 and September 7, Congress’s review period will extend to 60-calendar days to account for the Congressional recess in August.
Limitations on President’s Authority to Implement Deal
During and immediately prior to the review period, the President is prohibited from “waiving, suspending, reducing, providing relief from, or otherwise limiting the application of statutory sanctions with respect to Iran under any provision of law or refrain from applying any such sanctions pursuant to an agreement.” This is intended to limit the President’s authorities to provide Iran sanctions relief under a deal prior to Congress having an opportunity to review that deal.
Moreover, if Congress passes a Joint Resolution of Disapproval, the President will be further prohibited from relieving in any way statutory sanctions for a period of 12-calendar days.
Finally, if the President vetoes a Joint Resolution of Disapproval, the President will be prohibited from relieving in any way statutory sanctions for an additional period of 10-calendar days.
For each review period, though, statutory sanctions that were relieved pursuant to the Joint Plan of Action are excepted from these limitations and can continue to take effect.
During the review period, Congress can take three separate actions: Joint Resolution of Approval, Joint Resolution of Disapproval, or no action at all. In the instance that Congress passed a Joint Resolution of Disapproval and the Resolution survived a Presidential veto, the President would be prohibited from taking any “action involving any measure of statutory sanctions relief pursuant to an agreement […] or the Joint Plan of Action.” This would cause substantial harm to the U.S.’s ability to implement its commitments under a comprehensive nuclear deal.
The President is obligated to report to Congress information relating to a “potentially significant breach or compliance incident” by Iran with respect to an agreement within 10 days. Not later than 30 days after submitting such information, the President shall then make a determination as to whether the compliance issue constitutes a “material breach” and whether Iran has cured such material breach and shall submit his determination to Congress.
If the President determines that Iran has indeed materially breached the agreement and that such material breach has not been cured, then Congress can utilize expedited procedures to re-impose sanctions that had been relieved on Iran pursuant to an agreement.
The President is obligated to submit to Congress every 180-calendar days a report on Iran’s nuclear program and Iran’s compliance with the agreement, as well as issues unrelated to an agreement.
The President is obligated to provide certification to Congress every 90-calendar days that Iran is complying with an agreement. If the President fails to make such certification, then Congress can utilize expedited procedures to re-impose sanctions that had been relieved on Iran pursuant to an agreement.
Taken together, these provisions put in place strict oversight measures as to Iran’s compliance with a nuclear deal. However, some measures also threaten to materially disrupt the President’s current authorities to implement U.S. obligations pursuant to a deal by withdrawing from the President the discretion to relax sanctions on Iran. Should a Joint Resolution of Disapproval be enacted, the Iran Nuclear Agreement Review Act would seriously threaten the United States’ ability to faithfully adhere to its commitments pursuant to a nuclear deal.
Plausible Scenarios Arising from Iran Nuclear Agreement Review Act
The Iran Nuclear Agreement Review Act is headed to the Senate floor, where it may be open to further amendment. However, if the bill passes both Houses of Congress in its current form and the P5+1 and Iran conclude a nuclear deal, possible scenarios include:
It is possible that Congress is unable to take decisive action either for or against a nuclear deal. This would mean that, following the Congressional review period, the limitations imposed on the President’s ability to relieve statutory sanctions are lifted and the President is able to fully implement U.S.’s obligations under the deal. The damage to a nuclear deal would be limited.
Should Congress enact a Joint Resolution of Disapproval, the President would almost certainly veto the Resolution. This would extend the time period under which the President is prohibited from providing statutory sanctions relief to Iran and thus further delays the implementation of a final deal. However, to sustain the Joint Resolution of Disapproval, both the Senate and the House of Representatives would require two-thirds of its members voting to override the President’s veto. This would shape up to be a herculean task on the part of opponents of a nuclear deal, especially in light of the considerable efforts the White House would expend in defense of a nuclear deal.
The least likely scenario is that the Congress enacts a Joint Resolution of Approval. Considering the partisan rancor on Capitol Hill, it is unlikely that enough Members of Congress would affirmatively vote in favor of a nuclear deal. This scenario is made even more unlikely because the Iran Nuclear Agreement Review Act attaches no implications to a Joint Resolution of Approval: the President would simply be permitted to exercise his existing authorities to relieve sanctions on Iran.
President’s Surviving Authorities
Under a worst-case scenario, Congress could pass a Joint Resolution of Disapproval and then override a certain presidential veto. Most believe that this would tie the President’s hands from relieving sanctions on Iran and thus lead to the U.S. reneging on the commitments made pursuant to a deal.
However, a more nuanced perspective is required. While a Joint Resolution of Disapproval would prohibit the President from relieving in any manner “statutory sanctions” imposed on Iran pursuant to a deal, the President could scavenge together enough surviving authorities to relieve sanctions on Iran to sufficiently fulfill U.S. obligations under a nuclear deal and provide adequate relief to Iran.
This is, in part, because so many statutory prohibitions imposed on Iran are dependent on the President’s designation authorities. For instance, Section 104(c) of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (“CISADA”) contains a provision that sanctions foreign financial institutions that facilitate a significant transaction with Iranian parties designated pursuant to 31 C.F.R. Part 544 in connection with Iran’s proliferation of weapons of mass destruction. While a Joint Resolution of Disapproval would prohibit the President from waiving the application of this statutory prohibition, the President could effectively nullify the prohibition by removing the underlying designations now imposed on several of Iran’s major financial institutions. By removing the designation, the President would effectively authorize that which Section 104(c) had otherwise prohibited.
This would not be an optimal solution and would carry serious risks. First, it would force the United States to provide certain kinds of sanctions relief early on during the term of a nuclear deal that it otherwise might have held back as it gauged Iran’s sustained compliance. Second, it puts at risk Iran’s own compliance with its nuclear-related obligations, as the practical value of the sanctions relief granted to Iran might be insufficient to sustain Iran’s buy-in to the nuclear deal. Finally, the U.S.’s wavering commitment to adhere to its end of a bargain struck between Iran and the P5+1 would not just threaten to unravel the sanctions regime imposed on Iran, but would also undermine the viability of the United States exacting secondary sanctions prohibitions in future. Foreign States have committed to adhering to the U.S. sanctions regime imposed on Iran out of a belief in the underlying policy, but if that policy is judged a failure by U.S. partners because of actions taken by the U.S., then it is unlikely that the U.S. will be able to assemble a similar international coalition in the future.
Pending passage in both Houses of Congress, the Iran Nuclear Agreement Review Act will provide Congress a period of review and a level of oversight over a nuclear agreement between the U.S., its P5+1 partners, and Iran. However, the legislation will also limit the President’s authorities to implement the terms of a nuclear deal during the period of Congressional review and perhaps thereafter should Congress enact a Joint Resolution of Disapproval. Such limitations threaten to delay the implementation of a nuclear deal.
Nonetheless, the President retains creative solutions to deal adequately with this problem. Because the legislation only prohibits the President from relieving “statutory” sanctions (i.e., those enacted by Congress), the President can utilize his own separate authorities to shape sanctions relief should it prove necessary. While far from an ideal solution, this does present the President with options for dealing with any negative action by Congress.