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    "ocrText": "The original documents are located in Box 4, folder \"Arab Boycott - General (2)\" of the\nJohn Marsh Files at the Gerald R. Ford Presidential Library.\nCopyright Notice\nThe copyright law of the United States (Title 17, United States Code) governs the making of\nphotocopies or other reproductions of copyrighted material. Gerald R. Ford donated to the United\nStates of America his copyrights in all of his unpublished writings in National Archives collections.\nWorks prepared by U.S. Government employees as part of their official duties are in the public\ndomain. The copyrights to materials written by other individuals or organizations are presumed to\nremain with them. If you think any of the information displayed in the PDF is subject to a valid\ncopyright claim, please contact the Gerald R. Ford Presidential Library.\nDigitized from Box 4 of The John Marsh Files\nat the Gerald R. Ford Presidential Library\nHE WHITE HOUSE\nWASHINGTON Date 9-14-76\nTO: Jack marsh\nFROM: Max L. Friedersdorf\nFor Your Information\nPlease Handle\nPlease See Me\nE R GER AL D ALD LIBRARY FORD\nComments, Please\nof\nhere is final\nOther Per your requist,\nversum of Ribreoff\namindment\ninsert 71 EDD-PATS\n(12 pager)\nSENTE\nSeptember 11 1976\n3/28 p.m.\nAll\nPART VI--DENIAL OF CERTAIN TAX BENEFITS FOR COOPERATION\nWITH OR PARTICIPATION IN INTERNATIONAL BOYCOTTS AND\n)no\nIN CONNECTION WITH THE PAYMENT OF CERTAIN BRIBES\n28\nSEC. 1061. DENIAL OF FOREIGN TAX CREDIT.\n(a) In General Subpart A of part III of subchapter N\n===\n(relating to income from sources without the United States)\nis amended by adding at the end thereof the following new\nsection:\n768\n\"SEC. 908. REDUCTION OF CREDIT FOR PARTICIPATION IN OR\nCOOPERATION WITH AN INTERNATIONAL BOYCOTT.\n\" (a) In General If a taxpayer, or a member of a controlled\ngroup (within the meaning of section 993 (a) (3)) which includes\nthe taxpayer, participates in or cooperates with an international\nboycott during the taxable year (within the meaning of section\n999 (b)),\nthe amount of the credit allowable for the taxable\nyear under section 901 shall be reduced by an amount equal to\nthe product of--\n\"(1) the amount of the credit which, but\nfor this section, would be, allowed under section\n901 for the taxable year, multiplied by\n\"(2) the international boycott factor (determined\nunder section 999).\nQERALD FORD LIBRATTA\nmat\n71E0D\nUNITED STATES SENATE\n-2-\nITALIC\nOFFICE OF THE LEGIST\n\" (b) Application with Section 275(a) (4) Section 275\n(a) (4) shall not apply tc any amount of taxes denied credit\nunder subsection (a).\n\"or\n(b) Clerical Amendment. The table of sections for such\nsubpart is amended by adding at the end thereof the following\nnew item:\n14\n\"Sec. 908.\n)R\nReduction of credit for participation\nin or cooperation with an inter-\n8ft\nnational boycott.\n\"oe\nit SEC. 1062. DENIAL OF DEFERRAL OF INTERNATIONAL BOYCOTT AMOUNTS.\n(a) Denial of Deferral Section 952 (a) (relating to\n==\ngeneral definition of subpart F income) is amended-\n(1) by striking out \"and\" at the end of paragraph (1),\n(2) by striking out the period at the end of paragraph\n(2) and inserting in lieu thereof a comma, and the word\n(3)\n\"and\", and by adding at the end thereof the following\nnew paragraph:\nof\n\"(3) an amount equal to the product of--\n4\n\"(A) the income of such corporation other\nthan income which\n\"(1) is attributable to earnings and\nprofits of the foreign corporation included\nin the gross income of a United States person\nunder section 951 (other than by reason of this\nparagraph), or\n\"(11) is described in subsection (b),\nGERALE FORD LIBRARY\nUNITED STATES SENATE\nCFFICE CENTIFE LEGISLATIVE COUNSEL\nland Edd\n- 2A -\nALL ITALIO\nmultiplied by\n\" (B) the international boycott factor (as\ndetermined under section 999).\n11\n170\nSEC. 1063. DENIAL OF DISC BENEFITS.\n(a) International Boycott Activity. Subparagraph (D) of\nsection 995 (b) (1) (relating to distributions in qualified years)\nis amended to read as follows:\nf\n4\n\" (D) the sum of--\n\" (i) one-half of the excess of the taxable\nincome of the DISC for the taxable year, before\nreduction for any distributions during the year,\nover the sum of the amounts deemed distributed\nfor the taxable year under subparagraphs (A),\n(B), and (c), and\nDRD\nUNITED STATES SENATE\ninsuled\nOFFICE OF THE LEGISLATIVE COUNSEL\n-3-\nALL ITALIQ\n16\n\"(ii) an amount equal to the amount\ndetermined under clause (i) multiplied by the\ninternational boycott factor determined under\nsection 999, and\",\n1708\nSEC. 1064. DETERMINATIONS AS TO PARTICIPATION IN OR COOPERA-\nTION WITH AN INTERNATIONAL BOYCOTT.\n(a) In General Subchapter N of chapter 1 (relating to\ntax based on income from sources within or without the United\nStates) is amended by adding at the end thereof the following\nnew part:\n1740\nCAPS\n\"Part V--International Boycott Determinations\n4\n\"Sec. 999. Reports by taxpayers; determinations\np8pt\nic\n1768 \"SEC. 999. REPORTS BY TAXPAYERS; DETERMINATIONS.\n\"(a) International Boycott Reports by Taxpayers\n=\n\"(1) Report required If any taxpayer, or a.\n1\nmember of a controlled group (within the meaning of\nsection 993 (a) (3)) which includes the taxpayer, has\noperations in or related to--\n\"(A) a country (or with the government, a\ncompany, or a national of a country) which is on\nparagraph\nthe list maintained by the Secretary\n(%3, 3 , or\n\"(B) any other country (or with the government,\na company, or a national of that country) in which\nSTATE FORD\nUNITED STATES SENATE\nOFFICE OF THE LEGIS (ATIVE COUNSEL\n-3A-\nALL ITALIO\nthe taxpayer (or such member) had operations during\nthe taxable year if the taxpayer or member knows\nor has reason to know that participation in or\ncooperation with an international boycott is\nrequired as a condition of doing business within\nsuch country or with such government, company,\nor national,\n--\nthe taxpayer shall report such operations to the Secretary\nat such time and in such manner as the Secretary\nprescribes.\nParticipation and cooperation; requests therefor\nsc\n::\n(2) SQUARTTS A taxpayer shall also report\nwhether he or any member of a controlled group\nincludes\nwhich/the taxpayer has participated in or\ncooperated with an international boycott at any time\nduring the taxablè year, or has been requested to\nin\nwith\nparticipate /or cooperate Ea/such a boycott, and, if so,\nconnection with\nthe nature of any operation in/which he participated\nin or cooperated with such boycott (or was requested\nto participate or cooperate).\nGERALD FORD LIBRARY\nused HEDD\nUNITED STATES SENATE\n-4-\nOFFICE Cr THE LOGISLATIVE COUNSEL\nALL ITALIO\n\"(3) List to be maintained. The Secretary\nshall maintain and publish not less frequently\nthan quarterly a current list of countries which\nrequire or may require participation in or cooperation\nwith an international boycott (within the meaning\nof subsection (b) 122XZX (3)):\n\"(b) Participation In or Cooperation with an\nInternational Boycott.\n\"(i) General rule. If the taxpayer donsucher\nmember2/participates in or cooperates with an international\nboycott in the taxable year, all operations of the tax-\nin\npayer or such group in that country and 1 any other\ncountry which requires participation in or cooperation\nor a member of a controlled group (within the\nmeaning of section 993 (a) (3)) (a)(3)) which includes\nwith the boycott as a condition of doing business\nwithin that country, or with the government, a company,\nor a national of that country, shall be treated as\noperations in connection with which such participation\nor cooperation occurred, except to the extent that the\na\ntaxpayer can clearly demonstrate that a partici c/ (lar\noperation is a clearly separate and identifiable operation\nin connection with which he did not participate in or\nthe taxpayer\ncooperate with an international boycott.\nFORD\n5- insul 7/ED/7\nALL ITALIG\n(2) Special rule.\n(A) Non boycott operations. A clearly separate and\n\"(2) Special rule\n(A) Non-boycott operations A clearly\nseparate and identifiable operation of a person,\nor of a member of the controlled group (within\nthe meaning of section 993 (a) (3)) which includes\nthan person, in or related to any country within\nthe group of countries referred to in paragraph\n(1) shall not be treated as an operation in or\nrelated to a group of countries associated in\ncarrying out an international boycott if the\nperson can clearly demonstrate that he, or that\nsuch member, did not zmoperatexwx participate in\nor cooperate with the international boycott in\nconnection with that operation.\n#: (B) Separate and identifiable operations\nA taxpayer may show that different operations\nwithin the same country, or operations in different\ncountries, are clearly separate and identifiable\noperations.\nFORD\ninsult -6-\nEDD\nUNITED STATES SENATE\nFRICE OF THE LEGISLATIVE COUNSEL\nALL ITALIC\n\" (3) Definition of boycott participation and\ncooperation. For purposes of this section, a person\nparticipates in or cooperates with an international\nboycott if he agrees\n\"(A) as a condition of doing business directly or\nindirectly within a country or with the government,\na company, or a national of a country--\n(i) to refrain from doing business with or in\nwhich is the object of the boycott\na country /\nor with the government, companies,\nor nationals of that country;\nH (ii) to refrain from doing business with any\nUnited States person engaged in trade in a country\nis the object cf the boycott\nwhich / or with the government, companies, or\nnationals of that country;\n\"(iii) to refrain from doing business with any\ncompany whose ownership or management is made up,\nall or in part, of individuals of a particular\nnationality, race, or religion, or to remove\n(or refrain from selecting) corporate directors\nwho are individuals of a particular nationality,\nrace, or religion; or\n\"(iv) to refrain from employing individuals\nof a particular nationality, race, or religion; or\nrest 71EPP\nUNITED STATES SENATE\n-7-\nOFFICE OF THELESISLATIVE COUNSEL\nALL ITALIC\n\" (B) as a condition of the sale of a product\nto the government, a company, or a national of a\nthat\ncountry, to refrain from shipping or insuring sweke\nproduct. on a carrier owned, leased, or operated\nby a person who does not participate in or\nccoperate with an international boycott (within\nthe meaning of subparagraph (A)).\n11 (4) Compliance with certain laws This section shall\nnot apply to any agreement by a taxpayer (or such member)\n\"(A) to meet requirements imposed by a foreign\ncountry with respect to an international boycott\nif United States law or regulations, or an\nExecutive Order, sanctions participation in, or\ncooperation with, that international boycott,\n\"(B) to comply with a prohibition on the\nimportation of goods produced in whole or in part\nin any country which is the object of an international\nboycott other than the United States), or\n\"(c) to comply with a. prohibition imposed by\na country on the exportation of products obtained\nin such country to any country which is the object\nof an international boycott (other than the United =\nStates)\n2000\n-\ncreat NEDD\nUNITED STATES SENATE\nOFFICE OF THE LEGISLATIVE COUNSEL\n-8-\nALL ITALIO\n1\n(c) International Boycott Factor.\n\" (1) International boycott factor. For purposes of\nsections 908 (a), 952 (a) (3), and 995 (b) (3), the inter-\nnational boycott factor is a fraction, determined under\nregulations prescribed by the Secretary, the numerator of\nwhich reflects the world-wide operations of a person (or,\n(within the meaning of section 993(a)(3))\nin the case of a controlled group 31 corporative CA which\nincludes\nthat person,\ndone\nof the group) which are operations\n^\nin or related to a group of countries associated in carrying\nout an international boycott in or with which that person\nor a member of that controlled group has\nparticipated\nor cooperated in the taxable year, and\nthe denominator of which reflects the world-wide operations\nof that person or group. For purposes of this subsection,\nthe term 'world-wide operations' means operations in or related\nto countries other than the United States and its terrifories\nand possessions\na\nLIBRARY GERALD FORD\nenut 7/EDD\nUNITED STATES SENATE\nOFFICE OF THE LEGISLATIVE COUNSEL\n-9-\nALL ITALIO\n'(2) Specifically attributable taxes and income If\nthe taxpayer clearly demonstrates that the foreign taxes paid\nand income earned by the taxpayer for the taxable year with\n31-\nrespect to his worldwide operations are attributable to\nM\nspecific operations, then, in lieu of applying the inter-\nnational boycott factor for such taxable year, the amount\nof the credit disallowed under section- 908 (a), the addition\nto subpart F income under section 952 (a) (3), and the amount\nof deemed distribution under section 995 (b) (1) (D) (ii)\nfor the taxable year, if any, shall be the amounts\nspecifically attributable to the operations\nin which the taxpayer\nparticipated\nin or cooperated with an international boycott under\nsection 999 (b) (1).\n\"(3) World-wide operations For purposes of this\nsubsection, the term 'world-wide operations' means\noperations in or related to countries other than the\nUnited States.\nFORD i LIBRARY\n71EbD\nALL ITALNG\nUNITED STATES SENATE\nOFFICE OF THE LEGISLATIVE COUNSEL\n-9A-\n\"(d) Detorminations With Respect to Particular Operations\nUpon a request made by the taxpayer, the Secretary shall\nissue a determination with respect to whether a particular\noperation of the taxpayer, or of a member of a controlled\nwhich includes the taxpayer\ngroup constitutes\nparticipation in or cooperation with an international boycott.\nThe Secretary may issue such a determination in advance of\nwhich\nsuch operation in street cases 03 are of such a nature that an\nadvance determination is possible and appropriate under the\ncircumstances. If the request is made before the operation\nis commenced, or before the end of a taxable year in which\nthe operation is carried cut, the Secretary may decline to\nsuch a determination Deliefore\nissue the operation is ended 012 the close of\nthe taxable year, whichever first occurs.\n\"(e) Special Definition of Controlled Group For\npurposes of sections 908 (a), 952 (a) (3), 995 (b) (3),\nand this section, a non-corporate entity (including an individual)\nmay be treated as a member of a controlled group of corporations\nif that entity would be treated as a member of such group,\non the basis of stock ownership (including constructive\nownership within the rules of section 267 (c)) or otherwise,\nif it were a corporation.\n3\n- - 9B -\n\" (e) Participation or Cooperation by Related Persons\n111\nIf two or more corporations which are members of the same\ncontrolled group (within the meaning of section 993 (a) (3))\nare controlled by 5x five or fewer persons-\n\"(1) participation in or coopeaz cooperation\nwith an international boycott by such a corporation\nshall be considered to be such participation is or\ncooperation by each of those persons, and\n11 (2) participation in or cooperation with such\na boycott by such a person shall be considered to\nbe part such participation or cooperation by those\ncorporations.\nis\nFORD\nLORLO\ninsul 71EOD\nALL ITALIC\nUnited STATES SENSTE\ndigistative COUNSEL\n-10-\n(f) Willful Failure to Report. Any person (within the\n===\nmeaning of section 6671 (b)) required to report under this section\nwho willfully fails to make such report shall, in addition to\nother penalties provided by law, be fined not more than $25,000,\nimprisoned for not more than one year, or both.\".\n(b) Clerical Amendment. The table of parts for such\nsubchapter is amended by adding at the end thereof the following\nnew item:\n4\n\"Part V. International boycott determinations. (8pt)\n728\nSEC. 1065 FOREIGN BRIBES.\nexpect\n(a) Denial of Deferral\n(1) Controlled foreign corporations. Section 952\n(a) (relating to general definition of subpart F\nincome) is amended\n(A) by striking out \"and\" at the end of\nparagraph (2),\n(B) by striking out the period at the end\nof paragraph (3) and inserting in lieu thereof\na comma and the word \"and\", and\n(c) by adding at the end thereof the following\nnew paragraph:\nBERALD FORD LIBRARY\ninsult 71END\nUNITED STATES SENATE\n-10A-\nshe LEGISLATIVE COUNTRY\nALL ITALIC\n\"(4) the sum of the amounts of any illegal bribes,\nkickbacks, cr other payments (within the meaning of section\n162 (c)) paid by or on behalf of the corporation during\nthe taxable year of the corporation directly or indirectly\nto an official, employee, or agent in fact of a government. If\n(2) DISCs. Subparagarph (n) of section 995 (b) (1)\n(relating to distributions in qualified years) is amended\n(A) by striking out \"and\" at the end of clause (i),\n!\n(B) by adding at the end thereof the following\nnew clause:\n\"(iii) any illegal bribe, kickback, or other\npayment (within the meaning of section 162 (c))\npaid by or on behalf of the DISC directly or\nindirectly to an official, employee, or agent in\nfact of a\ngovernment, and\"\n(b) Bribes Not to Reduce Foreign Earnings and Profits\nSection 964 (a) (relating to earnings and profits of foreign\ncorporations) LS amended by adding at the end thereof the\nfollowing sentence: \"In determining such earnings and profits,\nor the deficit in such earnings and profits, the amount of any\nillegal bribe, kickback, or other payment (within the meaning of\nshall not be\nsection 15 (c))\ntaken into account to decrease such earnings and profits 02 to\nincrease such deficit.\nBERALD FORD LIBRAST\nUNITED STATES SENATE\nOFFICE/CE THE LEGISLATIVE COUNSEL\nment EDD\nIL ITALIC\nSEC. 1066. EFFECTIVE DATES.\n(a) International Boycotts.\n(1) General rule. The amendments made by this\n(5\npart (other than by section 1066) apply to participa-\ntion in or cooperation with an international boycott\nmore than 30 days after the date of enactment of this\nAct.\n(2) Existing contracts. In the case of operations\nwhich constitute participation in or cooperation with\nan international boycott and which are carried out in\naccordance with the terms of a binding contract entered\ninto before September 2, 1976, the amendments made by\n(5\nthis part (other than by section 1066) apply to such\nparticipation or cooperation after December 31, 1977.\n(b) Foreign Bribes The amendments made by section\n1066 apply to payments described in section 162 (c) of the\nInternal Revenue Code of 1954 made more than 30 days after\nthe date of enactment of this Act.\n-12\nMust\nEDD\nUNITED SENATE\ngive 65 THE LEGISLATIVE could\nITALIO\nSEC. 1067. REPORTS BY SECRETARY. HILL\n(a) Reports To The Congress As soon after the close\nof each calendar year as the data become available, the\nSecretary shall transmit a report to the Committee on Ways\nand Means of the House of Representatives and to the Committee\non Finance of the Senate setting forth, for that calendar\nyear\n(1) the number of reports filed under section\n999 (a) of the Internal Revenue Code of 1954 for\ntaxable years ending with or within such taxable year,\n(2) the number of such reports on which the\ntaxpayer indicated international boycott participation\n3\nor cooperation (within the meaning of section 999 (b) (2)\nof such Code), and\n(3) 3. detailed description of the manner in which\nthe provisions of such Code relating to international\nboycott activity have been administered during such\ncalendar year.\n(b) Initial List The Secretary of the Treasury shall publish\nan initial list of those countries which\nmay require participation in or cooperation with an inter-\nnational boycott as a condition of doing business within\nsuch country, or with the government, a company, or a\nnational of such country, (within the meaning of section\n999 (b) of the Internal Revenue Code of 1954) within 30\ndays after the enactment of this Act.\n111170\nSEP 15 1976\nTHE WHITE HOUSE\nWASHINGTON\nDate: 9-15-76\nTO: Jach\nFROM: Robert K Wolthuis\nFor your information X\nPlease handle\nOther\nI think you well be\ninterested in Hamilton\ncreivs regarding the\npossibility of offering\nStevenson as a substitute\nto Bingham - Rosenthel Bob\nDEPARTMENT OF STATE\nWashington, D.C. 20520\nCONF IDENTIAL\nSeptember 14, 1976\nMEMORANDUM FOR: Mr. Robert Wolthius\nThe White House\nSubject: Export Administration Act -\nLee Hamilton's Views\nHamilton told me at 3:30 that, in his judgment,\nany effort on the floor of the House would be counter-\nI\nproductive. He said, should you stimulate a substitute\namendment along the lines of the Stevenson amendment,\nyou would be badly embarrassed in the vote. He said I\nrecommend that you concentrate on the conference.\nHe confirmed my impression that most of the HIRC\nmembers who voted for Bingham in fact have reservations.\nabout its scope and would be inclined toward the Senate\nStevenson position in conference. He said the selection\nof conferces will be critical. My advice to you, Lee\nsaid, is to go to Doc Morgan and indicate your concern.\nHe normally, Lee continued, has chosen conferees on a\nbasis of strict seniority. In this instance, that\nmethod would be highly favorable to your objectives since\nit would exclude Rosenthal and Bingham. He said the\nconferees would then be Morgan, Zablocki, Fascell and\nFountain, Broomfield and Derwinski. With that lineup,\nit should be possible to assure the conferees will\nchoose Stevenson rather than Bingham.\nJents\nKempton B. Jenkins\nActing Assistant Secretary\nfor Congressional Relations\nFORD\nE\nCONT IDENTIAL\nDetermined to be Administrative Marking\nDate 12/3/85 By DAD\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 15, 1976\nMEMORANDUM FOR:\nTHE PRESIDENT\nFROM:\nJACK MARSH\nAs Floor action nears, pressures are increasing as to\nthe Administration's position on the Export legislation\nparticularly the Stevenson-Bingham Amendments. Some of\nthese pressures are coming from American industry who\nare indicating the possibility that they can live with\nthe Stevenson Amendment.\nA group of your advisers met last evening including\nrepresentatives of NSC, EPB, Counsel's Office and\nLegislative Affairs. It is our view that there are\nfive possible approaches to this matter which are:\n1. Active Administration support for a modified\nRibicoff Amendment. (There is some question\nas to whether such an amendment can be drafted\nbut it should be considered as a possibility.)\n2. Non-opposition and quiet support of the Adminis-\ntration of a modified Ribicoff Amendment intro-\nduced by Congressional leaders.\n3. Active Administration support for a modified\nStevenson Amendment (there is drafted language\nfor such an amendment).\n4. Non-opposition and quiet support for a modified\nStevenson amendment introduced by others.\n5. No action by the Administration to actively or\nquietly support any amendment but maintain a\nposition of opposition until the Conference.\nAs you are aware, the foreign policy implications of\nactive support are significant and there are risks\n=\nFORD\n-2-\ninvolved for non-opposition and quiet support insofar\nas foreign policy questions are concerned.\nIt was the consensus of the group that at least through\nWednesday, until we can see how the situation developes\non the Hill and the action in the Rules Committee, that\nwe should take no steps for either active or quiet support\nbut maintain the current posture against all amendments.\nHowever, the view was expressed that we should not totally\nabandon the possibilities of approach, which is non-\nopposition to the modified Stevenson Amendment. The\nmanner in which the Tax Bill was handled and the dis-\ncussions involving the Ribicoff Amendment could influence\nultimately any decision that you might wish to make.\naral\nSeptember 15, 1976\nBoycole\nMEMORANDUM FOR:\nTHE PRESIDENT\nFROM:\nJACK MARSH\nAs Floor action nears, pressures are increasing as to\nthe Administration's position on the Export legislation\nparticularly the Stevenson-Bingham Amendments. Some of\nthese pressures are coming from American industry who\nare indicating the possibility that they can live with\nthe Stevenson Amendment.\nA group of your advisers met last evening including\nrepresentatives of NSC, EPB, Counsel's Office and\nLegislative Affairs. It is our view that there are\nfive possible approaches to this matter which are:\n1. Active Administration support for a modified\nRibicoff Amendment. (There is some question\nas to whether such an amendment can be drafted\nbut it should be considered as a possibility.)\n2. Non-opposition and quiet support of the Adminis-\ntration of a modified Ribicoff Amendment intro-\nduced by Congressional leaders.\n3. Active Administration support for a modified\nStevenson Amendment (there is drafted language\nfor such an amendment).\n4. Non-opposition and quiet support for a modified\nStevenson amendment introduced by others.\n5. No action by the Administration to actively or\nquietly support any amendment but maintain a\nposition of opposition until the Conference.\nAs you are aware, the foreign policy implications of\nactive support are significant and there are risks\nBERALD FORD LIBRARY\nat\n-2-\nand\ninvolved for non-opposition and quiet support Les insofar\nas foreign policy questions are concerned.\nIt was the consensus of the group that at least through\nWednesday, until we can see how the situation developes\non the Hill and the action in the Rules Committee, that\nwe should take no steps for either active or quiet support\nbut maintain the current posture against all amendments.\nHowever, the view was expressed that we should not totally\nabandon the positbilities of approach, which is non-\nopposition to the modified Stevenson Amendment. The\nmanner in which the Tax Bill was handled and the dis-\ncussions involving the Ribicoff Amendment could influence\nultimately any decision that you might wish to make.\nJOM/dl\nFORD & LIBRA 078839\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 15, 1976\nMEMORANDUM FOR:\nDICK CHENEY\nFROM:\nJACK MARSH\nYou should be aware that the House Rules Committee\nthis afternoon granted a rule on the Export\nAdministration Bill by a vote of 9-6.\nAlso, the Rules Committee voted against granting a\nrule on the Strip Mining Bill by a vote of 9-5 with\none not voting.\nThe B FORD\nFINAL\nSEP 1976\nYou should know\nThe New York Times, on Tuesday, in an editorial\nCould the legislation make it impossible for\nentitled \"The Arab Boycott,\" addressed itself to leg-\nAmerican ships to call at Arab ports? We think SO.\nislation now being considered by the U.S. Congress,\nCould the legislation lead to inadvertent viola-\nwhich in effect would either. penalize American\ntions of criminal law by individuals in U.S. compa-\ncompanies or prohibit them from doing business\nnies? We think so.\nwith and/or in Arab countries. We applaud The\nIn our view, the end result of this sweeping leg-\nTimes for examining the implications of this legista-\nislation could be to jeopardize America's ability to\ntion; moreover, there are portions of the editorial\nacquire vital Arab oil.\nwith which we fully agree.\nIt could foreclose to the U.S. economy all op-\nWe agree. for example, that a boycott whose\nportunity to participate in the vast recycling of pet-\nmotivation is solely religious discrimination is TEX\nrodollars. which now total some tens of billions of\npugnant and unacceptable to the American way of\ndollars annually-a sum that is constantly growing.\nlife. [The Arab nations insist the boycott is not based\nThe legislation could, by foreclosing American\non religion.] Indeed, there is already a body of U.S.\nbusiness (oil: or others): from Arab markets, be the\nlaw which makes such discrimination illegal, and\nmost gigantic subsidy for foreign business ever en-\nwe support those laws.\nacted by Congress-a Marshalt Plan for America's\nWe think The Times has made a contribution\ncompetitors abroad.\nin speaking out on this issue. and in beginning an\nFinally, we don't believe it practical: to try to\nexamination of what sort of legislation, if any, is\nenact punitive legislation in an area in: which you\nappropriate. The purpose of this message is two-\nhave little OF no: leverage, and at this juncture and\nfold: first, to join in the debate and second, to pre-\nfor the foreseeable future, the United States needs\nsent more fully the consequences to the American\nArab oil more than the Arabs need U.S. goods and\npeople and the American economy if pending legis-\nknow-hown\nlation becomes law.\nFirst, some relevant facts:\nAmerica, we fear, might be reduced to a sec-\nond-rate economic power; our citizens, to a second-\nFact No. 1. America imports roughty 40% of the\noillit uses.\nrate standard of living. That's why we think this\nFact No. 2. About one-third of this imported oil\nissue is so important and why we welcome The New\ncomes from Arab countries, and this proportion is\nYork Times\" suggestion of more time for discussion.\ngrowing every day.\nWe believe that this issue has such vast foreign\nFact No. 3. Even if this country develops and\npolicy and security implications that legislation\nimplements policies that will permit fuller develop-\nshould only be enacted after the fullest debate and\nment of our energy resources. America will still\nonly after adequate rellection on the implications\nbecome increasingly reliant on Arab oil, particularly\nand consequences of what is best for the United\nin the next decade. There is simply no way around\nStates.\nthat fact of life. American economic growth, Ameri-\nMore than that, we want your voice heard. if\njobs, the American lifestyle-all will depend to a\nyou would like a copy of this legislation, write to\ngrowing degree on energy from the Arab nations.\nBox B, Mobil Oil Corporation, 150 East 42nd Street,\nAgainst this background. the Senate has al-\nNew York, N.Y. 10017. Read it. Then ask your Con-\nready passed, and the House is now considering,\ngressman what he thinks. We'd even like to hear his.\namendments to the Export Administration Act. We\nviews, after me relays them back to you.\nhave studied the proposed legislation. And we have\nThis may be among our more unpopular mes-\nmajor questions as to its impact. For example:\nsages. But it is better to focus on consequences\nCould the legislation make it impossible for\nnow, rather than try later to salvage something out\nAmerican companies to import Arab oil into the\nof economic chaos. Please don't think that we are\nUnited States? We think SO.\nblind or insensitive to the emotions involved on all\nCould the legislation make it impossible for\nsides of these issues. What we are pleading for is\nAmerican manufacturers to sell goods to Arab\nthat the issues be fully debated. To enact legislation\ncountries? We think so.\nas amendments to expart-control or tax laws, par-\nCould the legislation make it impossible for\nticularly in an election year, and with less than ade-\nAmerican banks to finance trade between the U.S.\nquate debate and reflection as to consequences,\nand Arab countries? We think so.\nwill not be in America's best interests.\nFORD\nMobil\nMobil\n1100 CONNECTICUT AVENUE, N.W.\nWASHINGTON, D.C. 20036\nThe Honorable John Marsi\nThe White House\nWashington, D. C.\nNC SNIHSOM\nRECEP. THE AND WHITE SECURITY HOUSE UNIT\n1976 SEP 15 PM 12\nExecutive Office Building Mailroom\nEntrance on 17th St. , near Pennsylvania Ave.\nSEP 1 6 1976\n10215\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 15, 1976\nMEMORANDUM FOR:\nJACK MARSH\nBRENT SCOWCROFT\nMAX FRIEDERSDORF\nFROM:\nED SCHMULTS Q\nSUBJECT:\nConsequences of a Possible\nExpiration of the Export\nAdministration Act\nI am advised by Commerce that no problems of any\nconsequence will occur if the Export Administration\nAct is permitted to expire. Commerce believes that\nall of the authorities under the Act may be exercised\nunder the Trading with the Enemy Act. In fact, the\nExport Administration Act has expired three times\nduring the recent past for periods up to a month\nwith no problems occurring.\nThe Commerce view is confirmed by Jack Goldklang,\nOffice of Legal Counsel at Justice, who is\nknowledgeable in this area.\nThe only possible problem that anyone sees is the\npossibility that a person upon whom a sanction\nmight be levied might assert that the authority\nto levy such a sanction is ambiguous under the\nTrading with the Enemy Act.\nFORD is LIBRARY alvay\nWashington Post\nMonday, September 20, 1976\nNo American Boycott\nT\nHE ARABS' DECISION to establish an Arab boy-\nvantage to themselves in ignoring the boycott than in\ncott of Israel is their business. But their attempt\nenforcing it. In the past, American companies had lit\nto establish an American boycott of Israel is some-\ntle incentive to help bring the Arabs to this sensible\nthing very different. It runs against American inter-\nview of their own self-interest. Now the American\nests, American values and the American grain. That\ncompanies have an incentive. Now, too, an American\nis the elementary distinction made by the Congress\ncompany declining to participate in the Arab boycott\nin writing anti-secondary-boycott provisions into the\nwill not face the same risk of paying a financial pen-\ntax reform bill. Whether a tax bill should be the vehi-\nalty for honoring the United States' longstanding an-\ncle for a measure related to foreign policy is an inter-\nti-secondary-boycott policy.\nesting question for the lawyers. The rest of us can\nOne needs to step back a pace. We think it entirely\ntake satisfaction that legislative teeth are being put\nhealthy and useful that the boycott issue has come to\ninto the diplomatic jawbone wielded quietly by the\nthe fore. It goes to the basic framework in which the\nadministration in the last few years. It is precisely in\nUnited States and the Arab world are trying to ex-\nthose last few years, of course, that the Arabs' prac-\npand and deepen a relationship that has been, until\ntice of a secondary boycott, one directed at American\nrelatively recently, narrow and formal and some-\nfirms that trade with Israel or that have Jewish or\ntimes even antagonistic. That there is potential for\n\"Zionist\" officers, has spread to encompass business\ngreat mutual advantage in the relationship is evident\ndeals measured in the hundreds of millions of dollars.\nto everyone. That is all the more reason to try to\nSeldom has the inadequacy of diplomacy and the ne-\nmove it forward on the basis of mutual respect. It\ncessity for legislation been SO overwhelmingly dem-\nmakes no more sense for Arabs to demand that\nonstrated.\nAmericans now boycott Israel than for Americans to\nOpponents of the new legislation argue, in effect,\ndemand that Arabs now trade with Israel. We would\nthat Arab nations are so determined to compel Amer-\nnot contend that, for all Arabs, it is easy to accept-the\nicans to support their boycott of Israel that, if flout-\nways of the open international system they are trying\ned, they will take their billions in business elsewhere\nto join. Arab states have made impressive progress,\nand perhaps even diminish the flow of their oil. No\nhowever, in halting discrimination against American\none would be surprised if some Arab-American deals\n(or other foreign) firms and individuals on strictly re-\nare junked in conspicuous and symbolic protest. But\nligious or ethnic grounds. The administration's diplo-\nit is demonstrably false that gaining American sup-\nmacy, by the way, has been quite effective in this re-\nport of their boycott is SO important to the Arabs\ngard. It will be harder for Arabs to accept that they\nthat, to that end, they will jeopardize the thick eco-\ncannot force Americans to discriminate in trade\nnomic and political ties they have built up SO care-\nagainst a third country. But it denigrates their intel-\nfully with the United States in recent years. Arabs\nligence, and it underestimates their general passion\nare spending billions on arms produced by the very\nfor modernization, to say that they must stick fast in\nmanufacturers who sell to Israel, for instance. They\ntheir traditional ways. Certainly Americans should\nare doing so presumably because they see more ad-\nnot be encouraging them to do SO.\nSEP 2 1 1976\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 20, 1976\nMEMORANDUM FOR:\nJACK MARSH\nBRENT SCOWCROFT\nMAX FRIEDERSDORF\nFROM:\nED SCHMULTS @\nSUBJECT:\nConsequences of a Possible\nExpiration of the Export\nAdministration Act\nRegarding my earlier memorandum, dated September 15,\n1976 (copy attached), you should note that the\nCongressional Research Service has expressed the\nview that the boycott regulations promulgated under\nthe Export Administration Act may not be supportable\nunder the Trading with the Enemy Act. Justice and\nCommerce disagree with this conclusion and I believe\nthey have by far the better end of the argument.\nI mention the Congressional Research Service view\nbecause it might provide the basis of a political\nattack on the President if he permits the Export\nAdministration Act to expire. This would be a\ndouble barrel attack, i.e., not only has the\nPresident blocked strong anti-boycott legislation,\nbut his own action in November 1975 to prohibit\ndiscriminatory practices in this country has also\nterminated.\nAttachment\nFORD & LIBRARY GIVE\nSeptember 15, 1976\nMEMORANDUM FOR:\nJACK MARSH\nBRENT SCOWCROFT\nMAX FRIEDERSDORF\nFROM:\nED SCHMULTS\nSUBJECT:\nConsequences of a Possible\nExpiration of the Export\nAdministration Act\nI am advised by Commerce that no problems of any\nconsequence will occur if the Export Administration\nAct is permitted to expire. Commerce believes that\nall of the authorities under the Act may be exercised\nunder the Trading with the Enemy Act. In fact, the\nExport Administration Act has expired three times\nduring the recent past for periods up to a month\nwith no problems occurring.\nThe Commerce view is confirmed by Jack Goldklang,\nOffice of Legal Counsel at Justice, who is\nknowledgeable in this area.\nThe only possible problem that anyone sees is the\npossibility that a person upon whom a sanction\nmight be levied might assert that the authority\nto levy such a sanction is ambiguous under the\nTrading with the Enemy Act.\n8. FORD\nSand\nFORDO\nto Breat\ndone 9/21\nall\nMEMORANDUM\nSEP 20%M\nCHARLS E. WALKER\nDATE 9/20/76\nTo Jeck Mersh:\nSome new\nstrategy.\nby\n(I'libe at home\ntonite + in office tomorrow.)\nSeptember 20, 1976\nMemorandum re: Bingham Amendment to Export Administration Act/Strategy\n1. H. R. 15377 is at the top of the list of legislation to be\nconsidered on the House floor Wednesday and Thursday of this week,\n(Monday and Tuesday are reserved for Suspension Calendar). The prin-\ncipal objective should be to get this legislation placed at the bottom\nof the list for this week since there are two or three pieces of major\nlegislation which would probably take up the balance of the legislative\ntime available this week. NAM, Chamber of Commerce, ECAT, and indi-\nvidual companies should focus their attention on the House Leadership\nand sympathetic congressmen to the effect that Bingham is a counter-\nboycott and goes way beyond what is necessary to protect the rights\nof U. S. citizens and could have serious and unnecessary repercussions\non U. S. business and U. S. foreign policy. We can live without the\nExport Administration Act if we have to for a few months. Efforts\nshould be directed at congressmen, particularly Democrats, who have\nsome Jewish influence in their districts as well as industry involved\nin export to the Middle East. The objective should be to encourage\nthese congressmen to indicate to the Leadership that they are getting\nintense pressure from both sides and don't really want to vote on this\nissue before the elections. Delay is the only way out for everyone;\ni.e., coming back with a short-term extension of six months to one year\nof the Export Administration Act in the last days of the session.\n2. Assuming that this strategy will not be wholly successful,\nthere are three approaches that can be taken on the floor:\na. Simply let the Bingham Amendment go through without any\nopposition except statements of the Administration spokes-\nmen that the legislation is \"unacceptable.\" The proponents\nof this legislation will most probably push for a record\nvote at some stage, in any event, and without an alterna-\ntive, very few Congressmen will actually vote \"no\" on\nBingham.\nb. Convince someone like Jim Collins of Texas who wrote the\nMinority views to the House Commerce Committee report\nto move to strike or move to recommit. This will surely\nevoke a response from the proponents and result in a very\nlarge vote in the House, locking the House conferees in\non the Bingham amendment. (The strategy here would be\nto create a deadlock in conference by getting the Senate\nconferees to go no further than Stevenson.) Again, the\nAdministration only states that this legislation is\n\"unacceptable\" including Stevenson.\nC. Let Bingham go through but have several sympathetic Con-\ngressmen from safe districts raise questions on the floor\nFORD\nabout the great risks involved and state that Bingham\ngoes too far by instituting a counter-boycott. This would\nnot stop the legislation, but would at least publicly\nstate some arguments that could later be used to support a\nveto.\n- 2 -\n3. The next major objective should be to try to keep any con-\nference from starting prior to Monday, September 27. Stan Marcus and\nGil Bray, Senate staff, should be encouraged to hold tight to Stevenson\nand not work with the House staff over the weekend on compromise language.\nOnce the bill gets to conference, Senator Tower should be encouraged by\nthe business community, but not directly by the President, to go no\nfurther than Stevenson. The Senate conferees will likely be the Sub-\ncommittee, and with enough work from the business community it would\nbe possible that a majority of the Senate conferees could be convinced\nto hold tight for their language with absolutely no changes. The major\nrisk here is that such a move would be successful, and that the House\nwould, at the urging of the Jewish organizations, recede completely to\nthe Stevenson language. Such a bill would be much harder to veto.\nWhile Morgan, Zablocki, Taylor, and Hamilton might be satisfied to\nultimately see a deadlock on this issue, it would be very difficult\nto involve them in any intricate strategy to produce the same. They\nprobably would vote to recede to the Senate language. This would\nprobably be true also of any Republican House conferees. Even this\nprocedure might, however, use up enough time so that the President\ncould then pocket veto the legislation.\n4. The next point of delay would be to have a few Senators\nfilibuster the Conference Report on the Senate floor. To make such\na strategy successful, ideally, the bill should not reach the floor\nof the Senate before Thursday, September 30, and even that may be cut-\nting it too close to avoid a cloture vote. The key here is probably\nByrd of West Virginia who has been most instrumental in the past in\norganizing cloture votes. Mansfield apparently won't be available\nbefore October 2. The foreign policy risks might be appealing to Byrd\nwho could somewhat control the Senate scheduling.\n5. The overall objective would be to delay final Congressional\nconsideration of the Conference Report until the session expires on\nOctober 2. If a deadlock holds or a filibuster appears on October 1\nor 2, there might be a chance to report out only a simple extension\nand the issue would never reach the President's desk. However, given\nthe course of this legislation to date, it is highly unlikely that\nthis strategy will succeed, and it must be assumed throughout that\nthe President is going to be faced with a veto decision. Hopefully,\nthat would come in the context of a pocket veto, but in any event,\nshould be maneuvered so that a vote on override and suspension will\nnot come up until after the elections if the Congress does not adjourn\nsine die on October 2.\nWe must also assume that, in the final analysis, the proponents\nof this legislation might prefer to have some legislation enacted--\neven if only Stevenson--prior to adjournment or recess on October 2.\nThus, there will be pressure on the Administration to come up with\nan \"acceptable compromise\" that the conferees can adopt, or to simply\n\"take\" Stevenson as it is, as the \"most nearly acceptable\" with \"clari-\nfying\" report language.\nIf a pure Stevenson amendment is reported from conference with\nthe support of the Jewish organizations and labor, the case will be\nmade to the Administration that this is the most moderate legislation\nCongress could pass (softened by report language); the President him-\nself said some legislation might be necessary; it goes no further than\n- 3 -\nRibicoff and a veto by the President would show that he didn't really\nmean what he said to B'nai B'rith and other Jewish leaders recently.\nThe proponents will allege this will cost Ford the support of the\nJewish voters. This may be an empty threat since the liberals in the\nJewish community and labor won't support Ford in any event, and those\nin these groups that now support Ford do so for other reasons than\nsupport of Israel and are, in the whole, unlikely to be swayed solely\nby this issue from that support.\nThe strategy should be based on a decision between two apparently\nmutually exclusive objectives:\n(a) Further legislation of any kind on this issue must be blocked\nor vetoed in order to prevent any negative reaction on the part\nof the Arab states. The Administration must not \"shift\"\nposition and this has the ultimate priority over domestic\npolitics. In this case, the President should have the\nworst possible amendment to veto (Bingham) and cannot af-\nford to get \"trapped\" with Stevenson or anything close to\nit;\nTOUG\n(b) A modified Stevenson might be acceptable and explainable to\nthe Arabs if it does not infringe on their sovereignty and,\nif not obtained, anything else could be vetoed with a minimum\nof adverse, domestic political effect. Again, care must be\ntaken to not get trapped with a \"pure\" Stevenson.\nThe only sure way to achieve (b) is with an Administration\n\"substitute\" on a take-it-or-leave-it basis (consistent with Ribicoff\ncompromise and B'nai B'rith speech). Preferably, this should be made\non the floor of the House to get maximum exposure, but in any event,\nclearly stated in conference. At least the outcome is certain--a\nmodified Stevenson or no legislation because of a veto. The latter\nis the more probable result given the course of this legislation to\ndate and the strength of the proponents.\nThe result has a high degree of certainty as to outcome in (b)\nand the strategy is not intricate, subtle or difficult to carry out.\nEither the conferees and Jewish groups pushing Stevenson and Bingham\ntotally cave in to get \"some\" legislation or they overreact and the\nSenate recedes to the House in large degree since even Stevenson is\n\"unacceptable\" and they cannot modify it further. The veto is then\neasier and political losses are minimized domestically.\nThe strategy under (a) is more intricate and less controllable.\nThe proponents can throw a curve by receding to the Senate language,\nparticularly if there is not a clear veto threat but only \"spokesmen\"\nsaying it (pure Stevenson) is unacceptable. Proponents can allege\nthat they caved; a pure Stevenson is no more than the President out-\nlined in his speech to B'nai B'rith; and he thus has broken his word\nto the Jewish communities, etc. There just is no sure way under\n(a) to conduct the strategy SO as to end up with a \"Bingham\" amendment\nout of conference and a \"good\" veto certainty lies with a strategy\nbased on (b). Strategy based on (a) is doable but unpredictable with-\nout an \"insider\" of considerable influence among both the House and\nSenate conferees, particularly, the House and that has to be a Democrat.\nThe unknown in (b) is whether the Arabs will' perceive and\nunderstand the gambit.\nCommittee on International Relations\nDemocrats\nThomas E. Morgan (Pa.), Chairman\nClement J. Zablocki (Wis.)\nL. H. Fountain (N. C.)\nDante B. Fascell (Fla.)\nCharles C. Diggs, Jr. (Mich.)\nRobert N. C. Nix (Pa.)\nDonald M. Fraser (Minn.)\nBenjamin S. Rosenthal (N.Y.)\nLee H. Hamilton (Ind.)\nLester L. Wolff (N. Y.)\nJonathan B. Bingham (N.Y.\nGus Yatron (Pa.)\nRoy A. Taylor (N. C.)\nMichael Harrington (Mass.)\nLeo J. Ryan (Calif)\nDonald W. Riegle, Jr. (Mich.)\nCardiss Collins (Ill.)\nStephen J. Solarz (N.Y.)\nHelen S. Meyner (N.J.)\nDon Bonker (Wash.)\nGerry E. Studds (Mass.)\n(4 vacancies)\nRepublicans\nWilliam S. Broomfield (Mich.)\nEdward J. Derwinski (Ill.)\nPaul Findley (Ill.)\nJohn H. Buchanan, Jr. (Ala.)\nJ. Herbert Burke (Fla.)\nPierre S. (Pete) duPont (Del.)\nCharles W. Whalen, Jr. (Ohio)\nEdward G. Biester, Jr. (Pa.)\nLarry Winn, Jr. (Kans)\nBenjamin A. Gilman (N. Y.)\nFORD\nTennyson Guyer (Ohio)\nRobert J. Lagomarsino (Calif.)\nSubcommittee on International Trade and Commerce\nDemocrats\nRepublicans\nJonathan B. Bingham, Chairman\nEdward G. Biester, Jr.\nDonald M. Fraser\nCharles W. Whalen, Jr.\nRoy A. Taylor\nDon Bonker\nGerry E. Studds\nCommittee on Banking, Housing and Urban Affairs\nDemocrats\nWilliam Proxmire (Wis.), Chairman\nJohn Sparkman (Ala.)\nHarrison A. Williams, Jr. (N. J.)\nThomas J. McIntyre (N. H.)\nAlan Cranston (Calif.)\nAdlai E. Stevenson (I11.)\nJoseph R. Biden (Del.)\nRobert Morgan (N. C.)\nRepublicans\nJohn Tower (Tex.)\nEdward W. Brooke (Mass.)\nBob Packwood (Ore.)\nJesse Helms (N. C.)\nJake Garn (Utah)\nSubcommittee on International Finance\nDemocrats\nAdlai E. Stevenson, Chairman\nWilliam Proxmire\nHarrison A. Williams\nThomas J. McIntyre\nAlan Cranston\nJoseph R. Biden\nRepublicans\nBob Packwood\nJohn Tower\nJesse Helms\nJake Garn\nFor your information\nDONALD E. SMILEY\nManager-Washington Office\nEXXON CORPORATION\nSuite 1014\n1025 Connecticut Avenue, N.W.\nWashington, D. C. 20036\n(202) 833-8100\naral\nSeptember 21, 1976\nBoycott\nDear Don:\nJust a short note to thank you for\nyour recent note together with the\ncopy of the mailgram to Members of\nthe House of Répresentatives in\nreference to the Export Administra-\ntion Act.\nwith kindest personal regards, I am\nSincerely,\nJohn 0. Marsh, Jr.\nCounsellor to the President\nMr. Donald E. Smiley\nManager-Washington Office\nExxon Corporation\nSuite 1014\n1025 Connecticut Avenue, N.W.\nWashington, D. C. 20036\ndl\nFORD : LIBRARY 038830\nMAILGRAM TO EVERY MEMBER OF U. S. HOUSE OF REPRESENTATIVES FOR DELIVERY\nON THURSDAY MORNING, SEPTEMBER 9, 1976;\nSEP\nThe International Relations Committee recently voted to attach an\nantiboycott amendment to the Export Administration Act, H.R. 7665. We\nare greatly concerned by the implications of this action.\nThe prohibitions of the amendment are so far reaching that economic\nrelations between this country and Arab nations could be effectively precluded.\nThe reason is that the amendment would in effect outlaw compliance with the\nlaws of Arab countries which regulate the origin of imports into their\nterritory and the destination of exports therefrom, including the export of\ncrude oil This would apply whether. a U.S. company or its affiliate were to\n--\noperate in, or solely purchase oil from, an Arab country: Currently the\nU.S. depends on these countries for more than forty per cent of its crude oil\nimports. Moreover, last year the U.S. exported more than five billion dollars\nworth of goods and services to Arab countries.\nThe proposed legislation while prohibiting discrimination for reasons\nof race, religion or national origin, is 50 sweeping that it goes far beyond\nthis objective which Exxon has long supported. In any case such unlawful\ndiscrimination is already dealt with by existing legislation.\nFor the foregoing reasons we urge you to oppose this and other related\npending legislation which could only do damage to:U.S. interests and relations\nwithout effectively combating the Arab boycott. Indeed such legislation could\nvery well result in a stricter enforcement of Arab boycott practices and\ncountry's\njeopardize our contry's ability to meet its ever increasing needs for oil\nimports.\nH. C. Kauffmann\n080\nPresident\nExxon Corporation\n1025 Connecticut Avenue, N. W.\nSuite 1014\nWashington, D. C. 20036\n1025 CONNECTICUT AVENUE, N.W.\nSUITE 1014\nWASHINGTON, D.C. 20036\nMr. John Marsh\nHING\nThe White House\nWashington, D. C.\nRECE HITE SECURITY HOUSE UNIT\n1976 AM 11 06\nTHE WHITE HOUSE\nWASHINGTON\nDate Sept. 21, 1976\nTO:\nJACK MARSH\nFROM: CHARLES LEPPERT\nPlease Handle\nFor Your Information\nPer Our Conversation\nOther:\nFORD i LIBRARY LIB 07 ARY\nDa\nSept. 21, 1976\n94th Congres:\nQuestion:\nWill you oppose the Export Administration bill, H.R. 15377\nif it contains the Rosenthal/Bingham anti-boycott language?\nTally Shee\nWestern and Plains (Talcott)\nMidwestern States (Myers)\nYes\nNo\nUnd.\nN/R\nYes\nNo\nUnd.\nN/R\nCalifornia\nIndiana\nBell\nHillis\nBurgener\nMyers\nClausen\nIouxa\nClawson\nGrassley\nGoldwater\nMichigan\nSPICIFIC\nBroomfield\nKetchum\nBrown\nLagomarsino (ARW)\nCederberg\nMcCloskey\nEsch O/T\nMoorhead\nHutchinson\nRousselot\nRuppe O/T\nTalcott lianing MD\nVander Jagt\nWiggins\nMinnesota\nWilson\nFrenzel (ARW)\nPettis\nHagedorn\nAlaska\nQuie\nYoung\nWisconsin\nArizona\nKasten\nConlan\nSteiger\nRhodes\nOhio\nSteiger\nAshbrook\nColorado\nBrown (ARW)\nArmstrong (ARW)\nClancy\nJohnson\nDevine\nIdaho\nGradison O/T\nHansen\nGuyer\nSymms\nHarsha\nNew Mexico\nKindness\nLujan\nLatta\nWashington\nMiller\nPritchard\nMosher\nKansas\nRegula\nSebelius\nStanton\nShriver\nWhalen\nSkubitz\nWylie\nWinn\nIllinois\nNebraska\nAnderson\nMcCollister off\nCrane\nSmith\nDerwinski\nThone (ARW)\nErlenborn\nNorth Dakota\nFindley (ARW)\nAndrews\nHyde\nOklahoma\nMadigan\nJarman\nMcClory\nSouth Dakota\nMichel\nAbdnor\nO'Brien\nPressler\nRailsback\nTotal\n5\n5\n10\n15\nTotal\n10\n6\n16\n9\nTotal pages 1 and 2\n30\n33\n44\n37\n1\nREPUBLICAN WHIP-ROBERT H. MICHEL\n94th Congres\nuestion: N.R.15377\nTally She\nBorder and Southern (Young)\nNew England and Mid-Atlantic (McDade)\nYes\nNo\nUnd.\nN/R\nYes\nNo\nUnd.\nN/R\naryland\nConnecticut\nGude\nMcKinney\nHolt\nSarasin\nBauman\nDelaware\nissouri\nduPont\nTaylor (ARW)\nMaine\nentucky\nCohen\nCarter\nEmery\nSnyder\nMassachusetts\nennessee\nConte (ARW)\nBeard\nHeckler\nDuncan\nNew Hampshire\nT\nQuillen\nCleveland\nlorida\nNew Jersey\nBafalis\nFenwick\nBurke\nForsythe\nRinaldo\nFrey Kelly leaving\nVermont\nYoung\nJeffords\north Carolina\nNew York\nBroyhill\nConable\nMartin\nFish\nouth Carolina\nGilman\nSpence\nirginia\nHorton\nButler\nKemp\nDaniel\nLent\nRobinson\nMcEwen\nWampler Whitehurst (ARW) leaved\nMitchell (ARW)\nPeyser\nlabama\nWalsh\nBuchanan\nWydler\nDickinson\nPennsylvania\nEdwards\nBiester\nrkansas\nCoughlin\nHammerschmidt\nEshleman\nouisiana\nGoodling\nMoore\nHeinz\nTreen\nJohnson (ARW)\n[ississippi\nMcDade leaving no\nCochran\nMyers\nLott.\nSchneebeli\neras\nSchulze\nArcher leaning\nShuster\nCollins\nSteelman maybe O/T\nTotal\n4\n15\n10\nis\nPaul\n&\nTotal\n11\n7\n8\n8\n(Rev. Mar. 1975)\n2\nAPRARI\n50-323-1\nCPO\nSeptember 22, 1976\nMEMORANDUM FOR:\nMAX FRIEDERSDORF\nFROM:\nJACK MARSH\nPept\n19767]\nWe should anticipate that sometime this afternoon the\nPresident may wish to consider the Arab Boycott\nmatter insofar as guidance to the conferees is con-\ncerned.\nDepending on what happens in the House, there are\nseveral likely alternatives:\n1. Support a compromise amendment in Conference.\n2. Oppose any modification in preparation for a\nveto.\n3. Accept, passively, action of the Conference.\nI suggest that you take steps to ascertain as quickly\nas possible current views and attitudes on the Hill\nas to the status of things on the Hill.\nAlso, your views on what might be done to get favor-\nable confermes.\nJOM/dl\nGREATE FORD FIBRARY\nSeptember 23, 1976\nMEMORANDUM FOR:\nJIM CANNON\nALAN, GREENSPAN\nBRENT SCOWCROFT\nBILL SEIDMAN\nFRANK ZARB\nFROM:\nJACK MARSH\nIt appear quite likely the House and Senate conferees\non the Export Bill will agree to a very restrictive\nboycott amendment.\nIf this does occur, we should begin efforts to study\nthe impact of such legislation, particularly in the an\neconomic and energy perspective. These inputs will\nbe essential for the President when he addresses the\nbill after it comes down from the Hill.\nThe nuclear amendment should also not be overlooked\nand the information on its impact should be made\navailable to the President.\nCC:\nDick Cheney\nJim Cavanaugh\nMax Friedersdorf\nBill Gorog\nJOM/dl\nFORD i LIBRARY 938839\nboycott\nSeptember 25, 1976\nMEMORANDUM FOR:\nED SCHMULTS\nFROM:\nJACK MARSH\nI think it would be helpful if you would simply\ntough base with J. T. Smith or Elliot Richardson\njust for the purpose of maintaining communications\nand contact.\nElliot gave me a call just before he left for a trip\non Thursday and indicated his desire, which I believe\nI mentioned to you, about having Commerce people go\nup to the Hill to see what kind of a deal they could\nget with the conferees.\nElliot went out of town and I did not get back to him\nand, therefore, I think it might be helpful for communi-\ncation purposes if you would touch base with J.T. Smith,\nwho Elliot designated to be his representative in\nthis regard.\nMy guess is that if this thing becomes troublesome,\nwe will have alot of people second guessing us by\nsaying that we would have taken the Stevenson Amend-\nment early on and gotten out of this whole thing. I\nam already getting this view and I suspect thathhat\nprobably has some merit, but the problem is that we\ndid not do it six weeks or several months ago for\nreasons which you know and we have to play the ball\nfrom where it is.\nI would like to minimize internal kibitsing of what\nwe did or did not do.\nJOM/d1\nFORD s LIBRARY 9ENALD\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 27, 1976\nFOR:\nJACK MARSH\nFROM: BRENT SCOWCROBB\nAttachment\n1:10 p.m., Monday, September 27, 1976\nPress Release Issued by the Saudi Arabian Embassy in New York\nThe Foreign Minister of Saudi Arabia categorically denies\nthe Washington Post story this morning that Saudi Arabia has indicated\nthat it would stop its rapidly growing oil shipments to the United States\nif developments hypothetically raised in the story occur.\nHis Royal Highness Prince Saud Al-Faisal, Saudi Arabia's\nForeign Minister, today said in New York:\n\"Saudi Arabia believes strongly in cooperation,\nnot confrontation. It seeks to work out its relations\nwith America and all other nations of the Free World\nconstructively and with moderation.\n\"As Saudi Arabia's Foreign Minister, I have\nhad constructive discussions during my current visit,\nwith the President of the United States and a number\nof Senators and Congressmen; and there has been\nabsolutely no intimation of anything except the desire\nof our country and indeed all the Arab World for a\nstrongly and mutually beneficial relationship with\nAmerica.\n\"As for the three-decade old Arab boycott\nof Israel currently in the news, Arab officials have\nmade clear again and again over the years that it is\nan economic tool as legitimate as similar American\nboycotts in effect now and in the past. It involves no\nreligious or racial discrimination and applies to all\ngroups. As long as the state of belligerency between\nIsrael and the Arab countries remains, the boycott\nwill continue. In truth, we do not understand how a\nboycott by the Arabs against Israel can be a basis\nfor action in the United States.\nFORD\n- 2 -\n\"As has been explained to us by many Americans,\npending legislation would, however, affect trade between\nthe United States and Arab countries in that it would\npenalize American workers and businesses trading with\nthe Arab World. But all that is a matter for Americans\nto resolve among themselves and requires no Arab\nresponse. If commerce is cut off between the Arab\ncountries and the United States, that would be the\nresult not of anything done by the Arabs but the conse-\nquence of action taken here against Americans trading\nwith the Arab countries.\n\"America and Saudi Arabia and, indeed, the\nentire Arab World have had a long and constructive\nrelationship. It is broader and deeper now than ever\nbefore. I am confident that the United States and the\nArab World will continue to have a mutually useful\nand rapidly growing relationship of the most fundamental\nkind. \"\n(Dictated by Miss Judy Noonan -- 212/421-4520)\nis\nFORD\nLIBRA\nUnite House\n2\nDL\n3\nWHB018(1821) (2-051785E271)PD 09/27/76 1821\n4\n5\nICS IPMMTZZ CSP\n1976 27 PM 7 31\n&\n2122490100 TDMT NEW YORL NY 77 ø9-27 ø621P EST\n7\n8\nPMS PRESIDENT GERALD FORD\n1976 SEP 28\n,\nWHITE HOUSE DC\n10\n\"\nTHE ORGANIZED JEWISH COMMUNITY URGENTLY REQUESTS YOUR ADMINISTRATION\n12\nTO TAKE ALL POSSIBLE MEASURES TO ASSURE THE FINAL ADOPTION OF THE\n13\n14\nANTI BOYCOTT LEGISLATION NOW BEFORE CONGRESS. ECONOMIC BLACKMAIL\n15\nMUST BE RESISTED; AMERICA CANNOT SELL ITS MORAL PRINCIPLES FOR OUL\n16\n17\nOIL MONEY. IT MUST NOT BECOME THE INSTRUMENT FOR FURTHERING THE\n18\nFOREIGN POLICY AIMS OF NATIONS WHOSE PURPOSES ARE INIMICAL TO OURS.\n19\n20\nTHE CONFERENCE OF PRESIDENTS OF MAJOR AMERICAN JEWISH ORGANIZATIONS\n21\nASK YOUR PERSONAL INTERVENTION TO THAT END\n22\n23\nRABBI ALEXANDER M SCHINDLER, CHAIRMAN\n24\nNNNN\n25\n26\nFORD 079339 LIBRARY\n1\n2\n3\n4\n(2-051785E271)PD 09/27/76 1821\n$\n5\nICS IPMMTZZ CSP\n6\n7\n2122490100 TDMT NEW YORL NY 77 09-27 0621P EST\nMAIL ROOM\nWHITE HOUSE ISE\nC\n8\nPMS PRESIDENT GERALD FORD\n1976 SEP 28 AM 9 03\n9\nWHITE HOUSE DC\n10\n\"\nTHE ORGANIZED JEWISH COMMUNITY URGENTLY REQUESTS YOUR ADMINISTRATION\n12\n13\nTO TAKE ALL POSSIBLE MEASURES TO ASSURE THE FINAL ADOPTION OF THE\n14\nANTI BOYCOTT LEGISLATION NOW BEFORE CONGRESS. ECONOMIC BLACKMAIL\n15\n16\nMUST BE RESISTED; AMERICA CANNOT SELL ITS MORAL PRINCIPLES FOR OUL\n(\n17\nOIL MONEY. IT MUST NOT BECOME THE INSTRUMENT FOR FURTHERING THE\n18\n19\nFOREIGN POLICY AIMS OF NATIONS WHOSE PURPOSES ARE INIMICAL TO OURS.\n20\nTHE CONFERENCE OF PRESIDENTS OF MAJOR AMERICAN JEWISH ORGANIZATIONS\n21\n22\nASK YOUR PERSONAL INTERVENTION TO THAT END\n23\nRABBI ALEXANDER M SCHINDLER, CHAIRMAN\n24\n25\nNNNN\n26\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 27, 1976\nMEMORANDUM FOR:\nJACK MARSH\nFROM:\nSUBJECT:\nBoycott JIM CANNON Jun Amendment\nNew York State does have a Boycott Amendment that\nrestricts trade from the port of New York.\nAccording to an authoritative Port Authority Source,\nthere are no figures to show that it has hurt trade\nthrough the port. Shipments out of this port have\nbeen about the same since the Boycott Amendment be-\ncame effective. Trade sources believe that there\nwould have been increases in shipments without the\nboycott, but there is no proof of it.\nFORD : LIBRARY GENALD\nJun Can't we get same\ncomparation figures ? on\nexports, N imports July\n9:44\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 29, 1976\nFORD\nFor:\nJack Marsh\nFrom:\nEd Schmults\nSTEVENSON AMENDMENT\nBINGHAM-ROSENTHAL\nPROPOSED CONFERENCE\nCURRENT LAW\n(SENATE BILL)\n(HOUSE BILL)\nSUBSTITUTE\nNONDISCRIMINATION\nCurrent Department of Commerce\nEssentially the same as current\nForbids discriminatory acts\nSame as Bingham-Rosenthal\nregulations forbid the furnishing\nlaw.\nas well as furnishing information\nof information pursuant to a\nwhich would have a discriminatory\nboycott-related request which\neffect.\nwould have a discriminatory\neffect.\nDISCLOSURE OF\nReports filed with the Depart-\nReports filed after date of\nReports publicly available -- no\nSame as Stevenson.\nBOYCOTT REPORTS\nment of Commerce regarding\nenactment are to be made avail-\nexplicit exemption for business\nreceipt of Arab boycott requests\nable for public inspection\nproprietary information.\nand compliance intentions of\nexcept for certain information\nexporters are kept confidential.\nregarding quantity and value\n(Under the \"Sunshine Act\" signed\nof goods if the Secretary of\ninto law by the President, names\nCommerce determines that a\nFORD\nof companies filing such reports\ncompetitive disadvantage to the\nmay have to be disclosed under\nreporting firm would result.\nthe Freedom of Information Act).\nREFUSALS TO DEAL\nSubject not treated under the\nRequires the Secretary of\nRequires the Secretary of\nEssentially the same as\nExport Administration Act.\nCommerce to adopt regulations\nCommerce to adopt regulations\nBingham-Rosenthal --\nHowever, concerted refusals to\nprohibiting American firms\nprohibiting any \"U.S. person\"\ncovers secondary as well\ndeal can constitute a violation\nfrom \"refusing to do business\nfrom refraining to do business\nas tertiary boycotts,\nof Section 1 of the Sherman Act.\nwith any other domestic concern\nwith any other U.S. person,\nsubject to certain\nThe Department of Justice has\nor person pursuant to an agree-\nbusiness concern, Israel or any\nlimited and technical\ncharged Bechtel Corporation\nment with, requirement of, or a\nIsraeli person or business concern\nexceptions.\nwith violation of the Sherman\nrequest from, or on behalf of,\n-- with intent to comply with or\nAct due to Arab boycott\nany foreign country, national,\nto further or support the Arab\ncompliance. Current law in no\nor agent thereof made or imposed\nboycott against Israel. Bingham-\nway covers refusals to deal with\nfor the purpose of enforcing or\nRosenthal thus covers secondary\nan foreign nation such as Israel\nimplementing a restrictive trade\nas well as tertiary boycotts.\n(a so-called \"secondary boycott\")\npractice or boycott against a\nand has not been applied to\ncountry friendly to the United\ncover refusals to deal with foreign\nStates or against any domestic\ncompanies or persons.\nconcern or person.\"\n(cont'd next page)\nSTEVENSON AMENDMENT\nBINGHAM-ROSENTHAL\nPROPOSED CONFERENCE\nCURRENT LAW\n(SENATE BILL)\n(HOUSE BILL)\nSUBSTITUTE\nREFUSALS TO DEAL\n(cont'd)\nA specific exception is\nmade for banks refusing to\nprocess letters of credit for\nthe benefit of U.S. exporters\nwhere the exporter fails to\ncomply with the requirements\nthereof, except where such\ncompliance would be a violation\nof law. As is the case with\ncurrent law, Stevenson does not\nFORD\ncover refusals to deal with\n\"secondary boycotts.\" Rather,\nStevenson aims at prohibiting\n\"tertiary boycotts,\" i.e.,\nrequests that U.S. concerns\nnot deal with other U.S.\nconcerns.\nFURNISHING OF\nAllows U.S. exporters to\nSame as current law.\nIn addition to forbidding\nProhibits furnishing\nINFORMATION\nfurnish boycott-related\nthe furnishing of information\ninformation with intent\ninformation -- except\nwhich would have a discrimina-\nto further the boycott,\nsuch information as would\ntory effect, forbids the\n\"about whether the\nhave the effect of dis-\nfurnishing of information\nperson does, has done,\ncriminating against\nabout \"any past, present, or\nor proposes to do\nAmerican citizens.\nproposed business relationship,\"\nbusiness with (Israel),\netc. with any United States\nor (an Israeli national)\nindividual, business concern,\nor with any other\nIsrael, national or resident\nboycotted person.\"\nof Israel, etc. -- with intent\n(The great preponderance\nto comply with or support the\nof boycott requests\nboycott against Israel.\nseek information about\nU.S. exporters' business\nrelationships with\nIsrael. A provision\nof law which forbids\nthe furnishing of such\ninformation could have\nsweeping impact.)\nSTEVENSON AMENDMENT\nBINGHAM-ROSENTHAL\nPROPOSED CONFERENCE\nCURRENT LAW\n(SENATE BILL)\n(HOUSE BILL)\nSUBSTITUTE\nPERSONS COVERED\nCurrent law is deemed to\nSame as current law.\nDoes not appear to\nProhibitions and\napply to U.S. firms engaged\nrequire nexus to export\nreporting requirements\nin export transactions and\ntransaction and would cover\napply to U.S. citizens,\nnot to the actions of U.S.-\nconduct of \"U.S. persons\"\ncorporations organized\ncontrolled business entities\nwherever undertaken for whether\nunder U.S. law, con-\nnot engaged in exporting from\nor not pursuant to an export\ntrolled foreign\nthe United States. This\ntransaction.\nsubsidiaries of U.S.\nconstruction is consistent\ncorporations and persons\nwith the enforcement of an\nFORD\ndoing business in the\nExport Administration Act.\nUnited States \"with\nIt has been declared that the\nrespect to their\nArab boycott-related regula-\nbusiness in the United\ntions would apply to the actions\nStates.\" Both the\nof a foreign subsidiary of a\nConference Substitute\nU.S. firm if that subsidiary\nand the Bingham-Rosenthal\nwere being used simply as a\nbill thus cover conduct\nconduit for U.S.-manufactured\nregardless of whether\ngoods on their way to Mid-East\nan export transaction\ncountries.\nis involved.\nENFORCEMENT AND\nBoycott-related regulations\nGenerally the same as\nAdds provision for private\nDeletes the Bingham-\nSANCTIONS\nunder the Export Administra-\ncurrent law -- except civil\ntreble damage suits by\nRosenthal treble\ntion Act are enforced under\nfines are increased. Increases\npersons \"aggrieved\" by\ndamage provision but\nthe general enforcement\ncomport to Administration pro-\nviolations of the Act.\nprovides that all\nprovisions of the Act --\nposal. Civil penalties for\nThis provision supplements\nenforcement will be\nusually by a civil fine.\nrefusals to deal can be levied\nthe normal range of sanctions\npursuant to APA\n(Compliance action under the\nonly after defendant is given\nprovided by current law.\nprocedures.\nExport Administration Act are\nan adjudicatory hearing pursuant\nspecifically exempted from the\nto the APA.\nrequirements of the Administra-\ntive Procedures Act (APA)).\nSEP 30 1976\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 30, 1976\nMEMORANDUM FOR:\nJACK MARSH\nBRENT SCOWCROFT\nMAX FRIEDERSDORF\nFROM:\nEDWARD SCHMULT$\nDD\nAttached is a draft of a proposed \"Statement of\nManagers\" that might be used to describe the\nproposal on the Arab Boycott reviewed with\nSenator Tower yesterday.\nAttachment\nSTATEMENT OF MANAGERS\nThe boycott-related provision adopted by the House\nand Senate Conferees combines features of both the House\nand Senate proposals. At the same time, it accommodates\nstrong concerns expressed by the Administration, that the\nlegislation not be so broadly drafted as to jeopardize\nor undercut essential diplomatic efforts to achieve a\nlasting peace in the Middle East.\nThe legislation states unequivocally that this\nNation will not tolerate any discrimination against\nindividuals or business concerns as a result of restric-\ntive trade practices or boycotts against countries\nfriendly to the United States. To assure that the Arab\nboycott of Israel does not have discriminatory and there-\nfore abhorrent and intolerable effects in the United States,\nthe Conference provision would (i) forbid any action,\nincluding the furnishing of information which has a\ndiscriminatory effect; (ii) require public disclosure of\nboycott reports; and (iii) prohibit \"refusals to deal\"\n-- the so-called \"tertiary\" effect of the boycott.\nParagraph (a) strengthens existing policy provisions\nof the Export Administration Act to reflect the new\nprohibition against refusals to deal by making it clear\nthat the United States opposes restrictive trade practices\nand boycotts against \"any domestic concern or person\" as\nwell as against \"other countries friendly to the United\nStates. \"\nParagraph (b) states that domestic concerns are to\nbe prohibited from taking any action in furtherance of\nrestrictive trade practices or boycotts against any\ncountry friendly to the United States or against any\ndomestic concern or person which would discriminate or\nhave the effect of discriminating against any individual\nor firm on the basis of race, color, religion, sex,\nnationality or national origin.\nParagraph (c) amends Section 4 of the Export\nAdministration Act to require that reports of requests\nfor boycott compliance, made to the Secretary of Commerce,\nGERALD FORD\n- 2 -\nbe publicly disclosed, except for certain specific informa-\ntion regarding quantity, description, and value of goods\nif the Secretary of Commerce determines that the disclosure\nof this latter information would place a domestic concern\nor person at a competitive disadvantage.\nParagraph (c) further amends Section 4 of the Act\nto require the Secretary of Commerce to adopt rules and\nregulations implementing the Act's strong policy mandate\nagainst discrimination and refusals to deal. Such regula-\ntions are to prohibit domestic concerns or persons from:\n(i) discriminating against any United States\nperson including company officers or\nshareholders, on the basis of race, color,\nreligion, sex, nationality, or national\norigin.\n(ii) furnishing information with respect to\nrace, color, religion, sex, nationality,\nor national origin of any individual.\n(iii) refusing to do business with any other\ndomestic concern or person, pursuant to\nan agreement or understanding with any\nforeign country, national or agent thereof,\nfor the purpose and with the intent of\ncomplying with a trade boycott against a\ncountry which is friendly to the United\nStates or against any domestic concern or\nperson.\nParagraph (c) also contains certain procedural and\nconforming provisions which state that this legislation\nneither substitutes for nor limits the antitrust laws\nof the United States and that no penalty for violation\nof the refusal to deal regulations can be imposed without\nan opportunity for an adjudicatory hearing on the record\nin accordance with the Administrative Procedures Act.\nThe Conferees believe that this legislation represents\na strong step to strengthen the national resolve to oppose\nthe Arab boycott of Israel and especially any discriminatory\neffects of that boycott on the U.S. economy. By requiring\nthat future boycott requests filed by U.S. firms be made\n2004 :\n- 3 -\npublic, the legislation would give the public and the\nCongress an opportunity to monitor the behavior of U.S.\nbusiness and the effectiveness of measures taken by the\nU.S. Government to implement our strong anti-boycott\npolicy. It would, at the same time, interject an element\nof public accountability in the responses of U.S. firms\nto boycott demands. The American public and the Congress\nwill have the opportunity to know the degree to which\nU.S. business relations are being bent to the interests\nof foreign governments. By proscribing refusals to deal,\nthe legislation will eliminate one of the most objectionable\nfeatures of the boycott -- its \"tertiary\" effect on freedom\nof choice within the U.S. economy.\nFORD\nHERALD\nOCT 1 1976\nTHE WHITE HOUSE\nWASHINGTON\nSeptember 30, 1976\nMEMORANDUM FOR: JACK MARSH\nFROM:\nSUBJECT:\nJIM Boycot CANNON Jun Amendment\nMy authoritative source says there are no figures to prove\nthat the New York State boycott has had an impact in either\nexports or imports.\nSong\nFORD is LIBRARY 07/139\n[oct 1976?]\n- 2 -\noffered a compromise amendment (see attachment) and\nlater offered to accept a boycott amendment similar\nto Senator Stevenson's with a minor modification.\nHowever, neither of these proposals was accepted\nand the Congress adjourned without passing an\nextension of the Export Administration Act. Each\nof the President's proposals indicated support for\nprospective public disclosure of boycott reports.\n10 q. FORD CIRREN,\nAdministration Offered Amendment\nForeign Boycotts\nSec.\n.\n(a) Section 3 (5) (A) of the Export Administration\nAct of 1969 (hereinafter in this Section referred to as the\n\"Act\") is amended by inserting immediately after \"United\nStates\" the following: \"or against any domestic concern or\nperson\"\n(b) Section 3 (5) (B) of the Act is amended by inserting\nimmediately after \"United States\" the following: \"and to\nprohibit such domestic concerns from taking any action in\nfurtherance of such restrictive trade practices or boycotts,\nwhich discriminates or has the effect of discriminating\nagainst any domestic concern or person on the basis of race,\ncolor, religion, sex, nationality or national origin\".\n(c) Section 4 of the Act is amended by redesignating\nparagraphs (2) through (4) and any cross references thereto\nas paragraphs (3) through (5) respectively, and inserting after\nparagraph (1) a new paragraph (2) as follows:\n11 (2) (A) Rules and regulations prescribed\nunder subsection 4 (b) (1) to implement the provisions\nof Section 3 (5) of this Act, shall require that any\ndomestic concern or person which receives a request\nto take any action referred to in Section 3 (5) (B)\nof this Act to report that fact to the Secretary of\nCommerce together with such other information as\nthe Secretary may require to enable him to carry\nout the requirements of Section 3 (5).\n\"(B) Any report hereinafter filed pursuant\nto this paragraph shall be made available\npromptly for public inspection and copying:\nProvided, however, that information regarding\nthe quantity, description, and value of any goods\nto which such report relates may be kept confidential\nif the Secretary determines that disclosure thereof\nwould place the domestic concern or person involved\nat a competitive disadvantage. The Secretary of\nCommerce shall transmit copies of such reports to\nthe Secretary of State for such action as the\nSecretary of State, in consultation with the\nSecretary of Commerce, may deem appropriate for\ncarrying out the purposes of Section 3 (5) of this\nAct.\n\"(C) Rules and regulations implementing the\nprovisions of Section 3 (5) of this Act shall\nprohibit domestic concerns and persons from:\nis\nFORD\n- 2 -\n(i) Discriminating against any United\nStates person, including any officer, employee,\nagent, director, or stockholder or other\nowner of any domestic concern on the basis of\nrace, color, religion, sex, nationality or\nnational origin.\n(ii) Furnishing information with respect\nto the race, color, religion, sex, nationality,\nor national origin of any past, present, or\nproposed officer, employee, agent, director,\nor stockholder or other owner of any domestic\nconcern.\n(iii) Refusing to do business with any\nother domestic concern or person, pursuant to\nan agreement or understanding with any foreign\ncountry, national or agent thereof, for the\npurpose and with the intent of complying with\na trade boycott against a country which is\nfriendly to the United States or against\nany domestic concern or person.\n\"(D) Any civil penalty (including any suspension\nor revocation of the authority to export) imposed\nunder this Act, for violation of rules and regulations\nissued under subparagraph (2) (C) (iii) of this para-\ngraph may be imposed only after notice and opportunity\nfor an agency hearing on the record in accordance with\nsections 554 through 557 of Title 5, United States\nCode. The provisions of subparagraph (2) (C) (iii)\nof this paragraph shall neither substitute for nor\nlimit the antitrust laws of the United States.\nFurther, the provisions of subparagraph (2) (C) (iii)\nof this subsection shall not apply to compliance with\nrequirements pertaining to the identity of any carrier\non which articles, materials, or supplies are to be\nshipped so long as such do not have as their purpose\nthe enforcement or implementation of a restrictive\ntrade practice or boycott against a country friendly\nto the United States or against any domestic concern\nor person.\"\nFORD\nTHE WHITE HOUSE\nWASHINGTON\nOctober 7, 1976\n5:10 p.m.\nMr. Marsh:\nCharlie Leppert left the following\nmessage:\n\"I was called by Tom Martin who tells\nme that Senators Proxmire, Ribicoff\nand Williams are expected to hold a\npress conference attacking the\nvalidity of the President's statements\nlast evening in the debate on the\nArab boycott issue.\"\nDonna\nTHE WHITE HOUSE\nWASHINGTON\nOctober 7, 1976 5:10 p.m.\nMr. Marsh:\nCharlie Leppert left the following\nmessage:\n\"I was called by Tom Martin who tells\nme that Senators Proxmire, Ribicoff\nand Williams are expected to hold a\npress conference attacking the\nvalidity of the President's statements\nlast evening in the debate on the\nArab boycott issue.\"\nDonna\nFORD j LIBRARY DERALO"
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