us-sanctions 02 November 2017

US House of Representatives passes sanctions against North Korea, Iran and Hizballah

The US Congress has voted decisively to pass new sanctions concerning North Korea (‘DPRK’), Iran and Hizballah.

The Otto Warmbier North Korea Nuclear Sanctions Act (previously the Impeding North Korea’s Access to Finance Act) reinforces President Trump’s executive order of 20 September, which imposed a sweeping set of secondary sanctions against those still doing business with Pyongyang.

The Act targets people who are considered to enable Pyongyang’s ballistic and nuclear weapons programme, including those already sanctioned under existing executive orders; financial institutions that facilitate trade with DPRK; and North Korean labourers working abroad, who provide a key source of revenue for the regime.

US  and foreign institutions which fall foul of the Act by knowingly dealing with a sanctioned entity will face a ban or have strict conditions imposed on their US-based correspondent and payable-through accounts.

The Iran Ballistic Missiles and International Sanctions Enforcement Act addresses Iran’s conventional missiles programme rather than the development of its nuclear capacity. It targets external support, imposing secondary sanctions against:

  • Iranian government agencies involved in ballistic missiles development not already covered by sanctions;
  • Foreign entities that supply material for, facilitate, or finance Iran’s ballistic missiles programme;
  • Foreign entities, including governments, that import, export or re-import prohibited arms to or from Iran;
  • Foreign entities that transfer goods or technologies that contribute to Iran’s ability to acquire or develop ballistic missiles or conventional weapons.

Under the Act, the President would report to Congress on the foreign and domestic supply chain concerning Iran’s ballistic missiles programme and also submit any credible evidence of potential breaches of US sanctions or UN Security Council Resolution 2231.

The House has also voted on three piece of legislation related to Hizballah: the Hizballah International Financing Prevention Amendments Act (‘HIFPA’); the Hizballah’s Illicit Use of Civilians as Defenceless Shields Act; and a resolution urging the EU to align its sanctions with the US.

The bills will now pass to the upper house of US Congress, the Senate, for consideration. The Senate is currently debating whether to impose sanctions on Myanmar for the military’s role in violence against the Rohingya minority – barely a year after decades of sanctions were lifted by the Obama administration – and also a draft bill concerning Iranian compliance with the nuclear deal.