March 28, 2017

Memo: S. 722 Would Designate IRGC a Terror Group

The ‘‘Countering Iran’s Destabilizing Activities Act of 2017’’ (S. 722) would mandate that the President designate the Islamic Revolutionary Guard Corps (IRGC) a terrorist organization. 
According to Section 5 of the bill, “Imposition of Terrorism-Related Sanctions with Respect to the IRGC,” the IRGC would be sanctioned pursuant to Executive Order 13224 – the foundational order to the U.S. Specially Designated Global Terrorist (SDGT) Sanctions Program. The designation itself would be implemented by the Executive Branch pursuant to passage of the bill. Congress views itself as being limited in its ability to designate parties pursuant to Orders granting sanctions authority to the Executive Branch alone, hence the legislation refers only to sanctioning the IRGC under the EO 13224 authority, leaving to the Executive the task of actually designating the IRGC an SDGT.
How does the bill designate the IRGC a terror group if it avoids a ‘Foreign Terrorist Organization’ (FTO) designation?
Designating the IRGC a SDGT is still a terrorist designation, and carries the same risks as an FTO designation. Other groups designated an SDGT include the Islamic State and al-Qaeda.
Groups who opposed the Joint Comprehensive Plan of Action have argued for designating the IRGC a SDGT for years, including AIPAC and the Foundation for Defense of Democracies. AIPAC’s advocacy for this issue dates back to at least 2007. Yet it remains a dangerous idea opposed by military and intelligence officials, as reporting last month indicated.
Could the sanctions of EO 13224 be implemented without designating the IRGC?
There is no example of an entity being designated pursuant to EO 13224 and not being labeled an SDGT, and there is no reason to believe any Administration – in particular the Trump administration – would construct a mechanism to circumvent the SDGT designation in its implementation of this legislation.
Consequences for U.S. Troops
In 2007, the Pentagon opposed the designation of the IRGC as an SDGT. The Joint Chiefs of Staff expressed concern that the designation of a foreign military could be reciprocated against the U.S. military, in particular Special Forces officers. Ultimately, the IRGC-Qods Force was designated per EO 13224 in 2007, a compromise reached to avoid a more dangerous designation of the full IRGC, which is now once again on the table today.
As former Deputy Secretary of State Antony Blinken argued in the New York Times last month:
The Bush and Obama administrations named Iran a state sponsor of terrorism and put sanctions on individual Revolutionary Guard commanders and two dozen Iranian firms to which the guard corps is connected. But they stopped short of designating the guards corps itself a terrorist organization because the potential blowback outweighed the benefits.
A direct challenge to the Revolutionary Guards Corps would likely cause its commanders to press for Iran’s withdrawal from the nuclear deal. It would undermine the re-election prospects of the accord’s main advocate, President Hassan Rouhani, who seeks to moderate Iran’s international behavior. It could also prompt the guards corps to unleash Shiite militias against United States forces in Iraq — just when our shared, if uncoordinated, objective of defeating the Islamic State there is within reach — or to go after American ships in the Gulf or shut down the Straits of Hormuz, through which 25 percent of the world’s oil flows.

Does the SDGT designation add new sanctions to the IRGC?

The IRGC is already one of the most sanctioned entities in the world—a fact that the 2015 nuclear deal did little to change. Any sanctions pursuant to EO 13224 and a SDGT designation would be duplicative of existing authorities, leaving only negative consequences from the unprecedented step of a terror label.

The Office of Foreign Assets Control also administers and enforces tough secondary sanctions on the IRGC, punishing foreign banks and firms implicated in transactions involving the IRGC or its designated affiliates with exclusion from the U.S. market. Those restrictions go beyond those that a terrorist designation would produce.

Background on the Specially Designated Terrorist Group designation
EO 13224 was promulgated in Sept. 2001 following the Sept. 11 terror attacks. EO 13224 imposes blocking sanctions on persons that the President determines engages in a range of activities, foremost of which is having committed or posing a risk of committing acts of terrorism that threaten the security of US nationals or US national security, foreign policy, or economy.
The Global Terrorism Sanctions Regulations, 31 C.F.R. Part 594, were thereafter promulgated to implement the EO.
Persons designated pursuant to EO 13224/GTSR are known as Specially Designated Global Terrorists.
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