November 16, 2017

House Committee Renews Attack on Aircraft Sales to Iran

Washington DC – “It would lead to the noncompliance of the JCPOA,” warned Rep. Keith Ellison (D-MN) of a new bill (H.R. 4324) targeting the sale of aircraft to Iran under the nuclear deal. “[T]he U.S. has committed to allow commercial passenger aircraft sales to Iran. This particular bill imposes additional requirements that could lead us to failing to meet that obligation.”

Rep. Ellison’s remarks were during a Congressional markup of two Iran bills in the House Financial Services Committee, both of which appear intended to undercut the Iran nuclear deal. Supporters of the accord raised strong objections during the markup, but the “Strengthening Oversight of Iran’s Access to Finance Act” (H.R. 4342) passed 38-21 and the “Iranian Leadership Asset Transparency Act” (H.R. 1638) passed 43-16. The bills next move to the House floor, where they are likely to pass. However, similar legislation has not previously been passed by the Senate, so it is possible that the bills will not become law.

Under the accord, the U.S. is obligated to “allow for the sale of commercial passenger aircraft and related parts and services to Iran,” including through the licensing of financial institutions to engage in such sales. This key provision provides substantial humanitarian benefits to the people of Iran, as Iran will be able to replace its aging and accident-prone air fleet. The accord would enable the U.S. to cancel the licensing of aircraft if Iran uses those licensed aircraft for non-civilian purposes.

However, H.R. 4324 would seek to cancel the licensed sale of aircraft on grounds separate from what is permissible under the JCPOA. The bill mandates reporting on whether the licenses benefit any person that has provided transportation services or material support for an individual on U.S. sanctions lists. If the administration is unable to make the certification, a likely scenario given the probability that Iranian airlines service individuals on U.S. sanctions lists, H.R. 4324 would push the administration to cancel the licenses. This would result in a clear U.S. violation of the accord.

The bill’s author, Rep. Roger Williams (R-TX), nevertheless urged passage stating “It’s about being careful of a country that wants to destroy America.” 

However, several additional JCPOA supporters voiced objections. Rep. Dennis Heck (D-WA) warned “[t]his is in fact only the latest attack on a core U.S. obligation under the JCPOA…This bill attempts to both name and shame banks that are participating in transactions.” Rep. Maxine Waters (D-CA), the ranking member of the committee, used deal opponents’ logic against them, stating “It’s clear that these sales get Iran to spend tens of billions of dollars on western commercial aircraft, and not missile development, military personnel, or weapons. Directing Iran’s spending away from these things is a plus for U.S. national security, as hawks who worry very much about Iranian windfall, should recognize.” 

The second bill, H.R. 1638, is nearly identical to a bill introduced in 2016 (H.R. 5461) that received a veto threat from the Obama administration. While proponents have argued that the measure would increase the transparency of Iranian leaders’ assets, the Obama administration warned that the bill would have diverted needed resources from the Department of Treasury, led to less transparency and undermined the JCPOA. 

Rep. Waters noted the irony of Republicans focusing on releasing the financial assets of Iran’s leaders when the American people continue to have concerns regarding President Trump’s own financial assets. “I do believe that if we truly are interested in transparency and making information public, it would be nice to start here at home and find out what this president controls,” she said. Waters also noted that the bill’s goal of “enlightenment” would likely fail given the “profound trust gap between the United States and Iran,” which would render it susceptible to charges of propaganda.

In defending the bill, Rep Bruce Poliquin (R-ME) argued that “We need to stay on offense as a country. On offense. And part of that is to interrupt the flow of funding to countries that want to harm us.” He suggested that the U.S. should deter businesses from engaging in permissible business with Iran, which would be a clear violation of the accord. “If it prevents me from transacting business so there’s less investment in a country that wants to kill us, has blood on their hands, good,” he argued.  

Rep. Ellison also warned that H.R. 1638 would backfire, suggesting that Iranian leaders targeted by the bill “will just go deeper in and we’ll know less” about their financial assets. Ellison also noted that in similar legislation introduced last year, the Congressional Budget Office estimated that much of the reporting required by the bill would be classified, doing little to enlighten the Iranian people about their leaders’ finances.

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