/Vol. 77, No. 38/Monday, February 27, 2012/Rules and Regulations
DEPARTMENT OF THE TREASURYOffice of Foreign Assets Control31 CFR Part 561Iranian Financial SanctionsRegulations
Office of Foreign AssetsControl, Treasury.
The Department of theTreasury’s Office of Foreign AssetsControl (‘‘OFAC’’) is amending theIranian Financial Sanctions Regulationsand reissuing them in their entirety, inorder to implement section 1245(d) of the National Defense Authorization Actfor Fiscal Year 2012, which provides forthe imposition of sanctions with respectto the Central Bank of Iran anddesignated Iranian financial institutions.
FOR FURTHER INFORMATION CONTACT
Assistant Director for SanctionsCompliance & Evaluation, tel.: 202/622–2490, Assistant Director for Licensing,tel.: 202/622–2480, Assistant Directorfor Policy, tel.: 202/622–4855, Office of Foreign Assets Control, or Chief Counsel(Foreign Assets Control), tel.: 202/622–2410, Office of the General Counsel,Department of the Treasury (not toll freenumbers).
Electronic and Facsimile Availability
This document and additionalinformation concerning OFAC areavailable from OFAC’s Web site(
).Certain generalinformation pertaining to OFAC’ssanctions programs also is available viafacsimile through a 24-hour fax-on-demand service, tel.: 202/622–0077.
On July 1, 2010, the President signedinto law the Comprehensive IranSanctions, Accountability, andDivestment Act of 2010 (Pub. L. 111–195) (22 U.S.C. 8501–8551)(‘‘CISADA’’). Subsection 104(c) of CISADA required the Secretary of theTreasury, not later than 90 days after thedate of CISADA’s enactment, toprescribe regulations to prohibit, orimpose strict conditions on, the openingor maintaining in the United States of acorrespondent account or a payable-through account for a foreign financialinstitution that the Secretary findsknowingly engages in specifiedsanctionable activities, subject to certainwaiver authorities provided to theSecretary in subsection 104(f) of CISADA. Subsection 104(d) of CISADArequired the Secretary of the Treasury,not later than 90 days after the date of CISADA’s enactment, to prescriberegulations to prohibit any personowned or controlled by a U.S. financialinstitution from knowingly engaging intransactions with or benefitting Iran’sIslamic Revolutionary Guard Corps(‘‘IRGC’’) or any of its agents or affiliateswhose property and interests inproperty are blocked pursuant to theInternational Emergency EconomicPowers Act (50 U.S.C. 1701
)(‘‘IEEPA’’). On August 16, 2010, theDepartment of the Treasury’s Office of Foreign Assets Control (‘‘OFAC’’)published the Iranian FinancialSanctions Regulations, 31 CFR Part 561(the ‘‘IFSR’’), to implement subsections104(c) and (d) and other relatedprovisions of CISADA (75 FR 49836).On September 28, 2010, the Presidentissued Executive Order 13553 (75 FR60567, October 1, 2010) (‘‘E.O. 13553’’),invoking the authority of,
,IEEPA and CISADA, and in order to takeadditional steps with respect to thenational emergency declared inExecutive Order 12957 of March 15,1995, with respect to Iran.Section 8 of E.O. 13553 authorizes theSecretary of the Treasury, inconsultation with the Secretary of State,to take such actions, including thepromulgation of rules and regulations,and to employ all powers granted to thePresident by IEEPA, as may benecessary to carry out section 104 of CISADA. In addition, section 8 of E.O.13553 authorizes the Secretary of theTreasury to redelegate these functions toother officers and agencies of the UnitedStates Government consistent withapplicable law. E.O. 13553 therebyprovided IEEPA authority for the IFSR.On December 31, 2011, the Presidentsigned into law the National DefenseAuthorization Act for Fiscal Year 2012(Pub. L. 112–81) (‘‘NDAA’’). Section1245(d)(1) of the NDAA requires thePresident to prohibit the opening, andprohibit or impose strict conditions onthe maintaining, in the United States of a correspondent account or a payable-through account by a foreign financialinstitution that the President determineshas knowingly conducted or facilitatedany significant financial transactionwith the Central Bank of Iran or anotherIranian financial institution designated by the Secretary of the Treasurypursuant to IEEPA. Pursuant to section1245(d)(2), a foreign financialinstitution conducting or facilitating atransaction for the sale of food,medicine, or medical devices to Iranwill not be subject to sanctions underthe NDAA for such transactions.For a private foreign financialinstitution, section 1245(d)(1) of theNDAA calls for sanctions beginning 60days after the date of enactment of theNDAA for transactions other than thosefor the purchase of petroleum orpetroleum products from Iran. Fortransactions by a private foreignfinancial institution for the purchase of petroleum or petroleum products fromIran, section 1245(d)(4)(C) calls forsanctions pursuant to section 1245(d)(1) beginning 180 days after the date of enactment of the NDAA (or later, asfurther described below). For a foreignfinancial institution owned orcontrolled by the government of aforeign country, including the central bank of a foreign country, section1245(d)(3) calls for sanctions pursuantto section 1245(d)(1) beginning 180 daysafter the date of enactment of the NDAA(or later, as further described below) andonly for transactions for the sale orpurchase of petroleum or petroleumproducts to or from Iran.For all foreign financial institutions,section 1245(d)(4)(C) of the NDAAprovides that the sanctions in section1245(d)(1) shall apply for transactionsfor the purchase of petroleum orpetroleum products from Iran only if thePresident makes required periodicdeterminations that there is sufficientsupply of petroleum and petroleumproducts from countries other than Iranto permit a significant reduction in thevolume of petroleum and petroleumproducts purchased from Iran by orthrough foreign financial institutions.Section 1245(d)(4)(D) of the NDAAprovides for an exception to theimposition of sanctions on any foreignfinancial institution if the Presidentdetermines and periodically reports toCongress that the country with primaryjurisdiction over that foreign financialinstitution has significantly reduced itsvolume of crude oil purchases from Iranduring a specified period of timepreceding the report.Pursuant to section 1245(d)(5) of theNDAA, the President may waive theimposition of sanctions in section1245(d)(1) for a period of not more than120 days, and may renew that waiver foradditional periods of not more than 120days, provided the President determinesthat such a waiver is in the nationalsecurity interest of the United Statesand submits a report to Congressproviding justification for the waiverand that includes any concretecooperation that the President hasreceived or expects to receive as a resultof the waiver.Finally, section 1245(g) of the NDAAprovides that the President may exerciseall authorities under sections 203 and
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