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31 C.F.R. Subpart E—Licenses, Authorizations, and Statements of Licensing Policy

Title 31 - Money and Finance: Treasury

Title 31: Money and Finance: Treasury
PART 575—IRAQI SANCTIONS REGULATIONS

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Subpart E—Licenses, Authorizations, and Statements of Licensing Policy

§ 575.500   Licensing procedures.

For provisions relating to licensing procedures, see part 501, subpart E, of this chapter. Licensing actions taken pursuant to part 501 of this chapter with respect to the prohibitions contained in this part are considered actions taken pursuant to this part.

[68 FR 53659, Sept. 11, 2003]

§ 575.501   Effect of license or authorization.

(a) No license or other authorization contained in this part, or otherwise issued by or under the direction of the Director of the Office of Foreign Assets Control, shall be deemed to authorize or validate any transaction effected prior to the issuance of the license, unless specifically provided in such license or authorization.

(b) No regulation, ruling, instruction, or license authorizes any transaction prohibited under this part unless the regulation, ruling, instruction, or license is issued by the Office of Foreign Assets Control and specifically refers to this part. No regulation, ruling, instruction, or license referring to this part shall be deemed to authorize any transaction prohibited by any provision of this chapter unless the regulation, ruling, instruction or license specifically refers to such provision.

(c) Any regulation, ruling, instruction, or license authorizing any transaction otherwise prohibited under this part has the effect of removing a prohibition or prohibitions contained in Subpart B from the transaction, but only to the extent specifically stated by its terms. Unless the regulation, ruling, instruction, or license otherwise specifies, such an authorization does not create any right, duty, obligation, claim, or interest in, or with respect to, any property which would not otherwise exist under ordinary principles of law.

§ 575.502   Exclusion from licenses and authorizations.

The Director of the Office of Foreign Assets Control reserves the right to exclude any person, property, or transaction from the operation of any license, or from the privileges therein conferred, or to restrict the applicability thereof with respect to particular persons, property, transactions, or classes thereof. Such action shall be binding upon all persons receiving actual or constructive notice of such exclusion or restriction.

§ 575.503   Payments and transfers to blocked accounts in U.S. financial institutions.

(a) Any payment of funds or transfer of credit or other assets, including any payment or transfer by any U.S. person outside the United States, to a blocked account in a U.S. financial institution located in the United States in the name of the Government of Iraq is hereby authorized, including incidental foreign exchange transactions, provided that such payment or transfer shall not be made from any blocked account if such payment or transfer represents, directly or indirectly, a transfer of any interest of the Government of Iraq to any other country or person.

(b) This section authorizes transfer of the funds of a blocked demand deposit account to a blocked interest-bearing account under the same name or designation as was the demand deposit account, as required pursuant to §575.203 or at the instruction of the depositor, at any time. If such transfer is to a blocked account in a different U.S. financial institution such transfer must be made to a blocked account in a U.S. financial institution located in the United States, and the transferee financial institution must furnish within 10 business days of the date of transfer, the notification described in paragraph (h) of this section to the Office of Foreign Assets Control, Blocked Assets Section.

(c) This section does not authorize any transfer from a blocked account within the United States to an account held outside the United States.

(d) This section does not authorize any payment or transfer to any blocked account held in a name other than that of the Government of Iraq where such government is the ultimate beneficiary of such payment or transfer.

(e) This section does not authorize any payment or transfer of credit comprising an integral part of a transaction which cannot be effected without the subsequent issuance of a further license.

(f) This section does not authorize the crediting of the proceeds of the sale of securities or other assets, held in a blocked account or a sub-account thereof, or the income derived from such securities or assets, to a blocked account or sub-account, under any name or designation which differs from the name or designation of the specific blocked account or sub-account in which such securities or assets were or are held.

(g) This section does not authorize any payment or transfer from a blocked account in a U.S. financial institution to a blocked account held under any name or designation which differs from the name or designation of the specified blocked account or sub-account from which the payment or transfer is made.

Note to §575.503: Please refer to §501.603 of this chapter for mandatory reporting requirements regarding financial transfers.

[56 FR 2113, Jan. 18, 1991, as amended at 56 FR 5636, Feb. 11, 1991; 58 FR 47646, Sept. 10, 1993; 62 FR 45109, Aug. 25, 1997]

§§ 575.504-575.532   [Reserved]

§ 575.533   Certain new transactions.

(a) New transactions. Except as provided in paragraph (b) of this section, on or after May 23, 2003 and prior to July 30, 2004, all transactions that are otherwise prohibited by subpart B of this part are authorized.

Note to §575.533(a): This authorization does not eliminate the need to comply with Executive Order 13315, “Blocking Property of the Former Iraqi Regime, Its Senior Officials and Their Family Members, and Taking Certain Other Actions,” or other provisions of 31 CFR chapter V, or with other applicable provisions of law, including any aviation, financial, or trade requirements of agencies other than the Department of the Treasury's Office of Foreign Assets Control. Such requirements include the Export Administration Regulations (15 CFR parts 730 through 799) administered by the Bureau of Industry and Security, Department of Commerce, and the International Traffic in Arms Regulations (22 CFR parts 120 through 130) administered by the Department of State.

(b) Continued blocking, special provisions for certain exports and reexports, and additional conditions. (1) All property and interests in property that were blocked as of May 23, 2003, pursuant to Executive Orders 12722 or 12724, or subpart B of this part, remain blocked and subject to the prohibitions and requirements of this part.

(2)(i) Any specific license issued by the Treasury Department before July 30, 2004, for the exportation from the United States, or, if subject to U.S. jurisdiction, the exportation or reexportation from a third country to Iraq of any items (including technical data or other information) controlled by the Department of Commerce under the Export Administration Regulations (15 CFR parts 730 through 799) for exportation to Iraq shall expire on the date set forth in that license, or, if no expiration date is provided in that license, on July 30, 2005.

Note to §575.533(b)(2)(i): Effective July 30, 2004, with the termination of the national emergency declared in Executive Order 12722 and the revocation of that Executive order, OFAC's authority to license exports and reexports to Iraq ceases, and the licensing jurisdiction for exports and reexports to Iraq will be transferred back to the Department of Commerce. All OFAC license applications pending but not acted upon before July 30, 2004, will be returned to applicants and applicants will be required to resubmit them to the Department of Commerce using the appropriate Department of Commerce forms. Moreover, as July 30, 2004, OFAC will not accept any applications for licenses for exports or reexports to Iraq. On or after July 30, 2004, all inquiries and applications regarding such exports or reexports are to be made to the Exporter Services Office, Bureau of Industry and Security, Department of Commerce (telephone: 202–482–4811).

(ii) Persons issued a specific license by the Treasury Department before July 30, 2004, for the exportation from the United States, or if subject to U.S. jurisdiction, the exportation or reexportation from a third country to Iraq, of any items (including technical data or other information) controlled by the Department of Commerce under the Export Administration Regulations (15 CFR parts 730 through 799) must maintain such records as are required by 15 CFR part 746 of the Export Administration Regulations.

Note to §575.533(b)(2)(ii): Pursuant to an amendment to the Export Administration Regulations (15 CFR parts 730 through 799), effective July 30, 2004, further authorization by the Department of Commerce will not be required for exports or reexports licensed by the Department of the Treasury until the Treasury Department license expires by its own terms, or, if no expiration date is provided in the license, until July 30, 2005. Those holding specific licenses issued by the Treasury Department for exports or reexports to Iraq must comply with the recordkeeping requirements found in 15 CFR 746.3 of the Export Administration Regulations.

(iii) Items licensed by the Treasury Department for exportation or reexportation to Iraq may not be transferred within Iraq to a new end-user without further authorization from the Bureau of Industry and Security, Department of Commerce. Reexportation of items originally authorized pursuant to a specific license issued by the Treasury Department must conform to the relevant provision of the Export Administration Regulations (15 CFR parts 730 through 799) based on the items being reexported and the country to which they are being reexported.

Note to §575.533(b)(2)(iii): Pursuant to an amendment to the Export Administration Regulations (15 CFR parts 730 through 799), effective July 30, 2004, further authorization by the Department of Commerce will be required for exports or reexports licensed by the Department of the Treasury prior to the transfer of such items within Iraq to a new end-user. The amendment also requires that any reexportation of items pursuant to a specific license issued by the Treasury Department must conform to the relevant provision of the Export Administration Regulations (15 CFR parts 730 through 799) based on the country to which the items are being reexported.

Note to §575.533(b)(2): The term “controlled by the Department of Commerce” means subject to a license requirement under the Department of Commerce's Export Administration Regulations (EAR). Items subject to a license requirement under the EAR include items on the Commerce Control List that require a license for exportation or reexportation to Iraq pursuant to 15 CFR part 742 or 15 CFR 746.3, as well as items and activities that require a license under the end-use and end-user provisions of 15 CFR part 744. To inquire whether particular items are controlled by the Department of Commerce under the Export Administration Regulations for exportation to Iraq, the exporter or reexporter should contact the Department of Commerce, Bureau of Industry and Security.

(3) This section does not authorize any transactions with persons listed in appendix A to chapter V of title 31, Code of Federal Regulations, except for those organizations listed in paragraph (b)(4) of this section.

(4) Notwithstanding paragraph (b)(3) of this section, and except as provided in paragraphs (b)(1), (2) and (5), on or after May 23, 2003, all transactions that are otherwise prohibited by subpart B of this part are authorized for the following Iraqi state bodies, corporations or agencies that are listed in Appendix A to chapter V, title 31, Code of Federal Regulations, but that are now operating under the authority of the coalition, an interim or transitional Iraqi government, or a subsequent permanent Iraqi government:

Agricultural Cooperative Bank

Al-Rafidain Shipping Company

Industrial Bank of Iraq

Iraq Reinsurance Company

Iraqi Airways

Iraqi-Jordan Land Transport Company

Iraqi State Enterprise for Maritime Transport

Rafidain Bank

Rasheed Bank

Real Estate Bank

Note to §575.533(b)(4): Numerous other Iraqi state bodies, corporations, or agencies are not listed in Appendix A to chapter V, 31 CFR. This section permits transactions with such entities on or after May 23, 2003. But for the operation of this paragraph (b)(4), these entities would be blocked under subpart B because they meet the definition of ‘Government of Iraq’ in 31 CFR 575.306 or ‘entity of the Government of Iraq’ in 31 CFR 575.304, whether or not they appeared in appendix A to chapter V, 31 CFR.

(5) This section does not authorize any transactions with respect to Iraqi cultural property or other items of archaeological, historical, cultural, rare scientific, and religious importance illegally removed from the Iraq National Museum, the National Library, and other locations in Iraq since August 6, 1990. Any trade in or transfer of such items, including items with respect to which reasonable suspicion exists that they have been illegally removed.

Note to §575.533(b)(5): Questions concerning whether particular Iraqi cultural property or other items are subject to this paragraph should be directed to the Cultural Property Office, U.S. Department of State, tel. 202–619–6612, fax 202–260–4893, Web site http://www.exchanges.state.gov/culprop, e-mail [email protected].

(c) Effective date. Paragraphs (a), (b)(1), (b)(3), (b)(4) and (b)(5) of this section are effective May 23, 2003. Paragraph (b)(2) of this section is effective July 30, 2004.

[69 FR 46092, July 30, 2004]

§ 575.534   Transfers of certain blocked claims by U.S. financial institutions.

U.S. financial institutions are authorized to transfer claims that were booked in the United States as of May 23, 2003, against the Government of Iraq for unpaid loans and other debts to their home offices or to other foreign offices of the same institution. This section authorizes only the transfer of claims and does not authorize the debiting of any blocked account

[68 FR 65845, Nov. 24, 2003]

§ 575.535   Iraqi debt unblocked.

(a) Except as provided in paragraph (b) of this section, all transactions otherwise prohibited by this part that involve debts in which the Government of Iraq has an interest are authorized.

(b) For purposes of this part:

(1) This section does not authorize transactions that remain prohibited under the terms of paragraphs (b)(3) and (b)(5) of §575.533 of this part.

(2) This section does not authorize the purchase, exchange or settlement of debt in which the Government of Iraq has an interest utilizing funds or other property that is blocked pursuant to this part.

[70 FR 54259, Sept. 14, 2005]

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