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Iran/Arms Transaction: Legal Memoranda: Sale and Shipment of Military Equipment to Iran (3)
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118565710
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Iran/Arms Transaction: Legal Memoranda: Sale and Shipment of Military Equipment to Iran (3)
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Records of the Office of Counsel to the President (Reagan Administration)
Arthur Culvahouse's Office Files
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Ronald Reagan Presidential Library Digital Library Collections This is a PDF of a folder from our textual collections. Collection: Culvahouse, Arthur B.: Files Folder Title: Iran/Arms Transaction: Legal Memoranda: Sale and Shipment of Military Equipment to Iran (3) Box: CFOA 1131 To see more digitized collections visit: https://reaganlibrary.gov/archives/digital-library To see all Ronald Reagan Presidential Library inventories visit: https://reaganlibrary.gov/document-collection Contact a reference archivist at: [email protected] Citation Guidelines: https://reaganlibrary.gov/citing National Archives Catalogue: https://catalog.archives.gov/ WITHDRAWAL SHEET Ronald Reagan Library Collection Name CULVAHOUSE, ARTHUR B. .:FILES Withdrawer DLB 8/20/2014 File Folder IRAN/ARMS TRANSACTION: LEGAL MEMORANDA: FOIA SALE AND SHIPMENT OF MILITARY EQUIPMENT TO S643 IRAN Box Number CFOA 1131 SYSTEMATIC 160 ID Doc Type Document Description No of Doc Date Restrictions Pages 165158 MEMO PETER WALLISON TO DONALD REGAN, 6 11/11/1986 B1 RE: LEGAL RESTRICTIONS ON SHIPMENTS OF U.S. MILITARY EQUIPMENT TO IRAN The above documents were not referred for declassification review at time of processing Freedom of Information Act [5 U.S.C. 552(b)] B-1 National security classified information [(b)(1) of the FOIA] B-2 Release would disclose internal personnel rules and practices of an agency [(b)(2) of the FOIA] B-3 Release would violate a Federal statute [(b)(3) of the FOIA] B-4 Release would disclose trade secrets or confidential or financial information [(b)(4) of the FOIA] B-6 Release would constitute a clearly unwarranted invasion of personal privacy [(b)(6) of the FOIA] B-7 Release would disclose information compiled for law enforcement purposes [(b)(7) of the FOIA] B-8 Release would disclose information concerning the regulation of financial institutions [(b)(8) of the FOIA] B-9 Release would disclose geological or geophysical information concerning wells [(b)(9) of the FOIA] C. Closed in accordance with restrictions contained in donor's deed of gift. WITHDRAWAL SHEET Ronald Reagan Library Collection Name Withdrawer CULVAHOUSE, ARTHUR B. FILES DLB 8/20/2014 File Folder FOIA IRAN/ARMS TRANSACTION: LEGAL MEMORANDA: SALE S643 AND SHIPMENT OF MILITARY EQUIPMENT TO IRAN SYSTEMATIC Box Number CFOA 1131 160 ID Document Type No of Doc Date Restric- Document Description pages tions 165158 MEMO 6 11/11/1986 B1 PETER WALLISON TO DONALD REGAN, RE: LEGAL RESTRICTIONS ON SHIPMENTS OF U.S. MILITARY EQUIPMENT TO IRAN The above documents were not referred for declassification review at time of processing Freedom of Information Act - [5 U.S.C. 552(b)] B-1 National security classified information [(b)(1) of the FOIA] B-2 Release would disclose internal personnel rules and practices of an agency [(b)(2) of the FOIA] B-3 Release would violate a Federal statute [(b)(3) of the FOIA] B-4 Release would disclose trade secrets or confidential or financial information [(b)(4) of the FOIA] B-6 Release would constitute a clearly unwarranted invasion of personal privacy [(b)(6) of the FOIA] B-7 Release would disclose information compiled for law enforcement purposes [(b)(7) of the FOIA] B-8 Release would disclose information concerning the regulation of financial institutions [(b)(8) of the FOIA] B-9 Release would disclose geological or geophysical information concerning wells [(b)(9) of the FOIA] C. Closed in accordance with restrictions contained in donor's deed of gift. THE WHITE HOUSE WASHINGTON November 12, 1986 MEMORANDUM FOR DONALD T. REGAN CHIEF OF STAFF TO THE PRESIDENT FROM: PETER J. WALLISON pep SUBJECT: Sales of U.S. Military Equipment to Iran Introduction Various press reports have described alleged shipments of U.S. military equipment to Iran. The manner in which such shipments are said to have taken place varies widely throughout the differing accounts. Determination of the applicable law, and analysis of relevant legal provisions, is heavily dependent upon a precise rendering of the facts. The following general discussion, therefore, is designed solely to provide an overview of possibly relevant provisions of the Arms Export Control Act, the Export Administration Act, and related orders and regulations. This memorandum does not, however, offer any conclusions as to the legality of alleged shipments of U.S. military articles to Iran. In my opinion, it would be inappropriate to offer any such conclusions solely on the basis of hypothetical facts or media accounts. Arms Export Control Act Generally, export to foreign countries of items on the U.S. Munitions List / is governed by the Arms Export Control Act. The Act generally applies, however, only to sales or leases by the United States government. Transactions involving non-Munitions List items, structured as other than sales or leases, or involving a principal other than the United States government, may not be covered by the Act. * / The United States Munitions List covers a wide range of items deemed to be inherently military in character including, but not limited to, firearms, munitions and rockets; military aircraft, vehicles and electronics; and equipment and spares for such items. - 2 - Non-Transfer and Use Assurances. Pursuant to section 3 of the Act, sales or leases of military articles to any country or international organization are permitted only if that country or organization agrees not to transfer such articles to a third country (e.g., Iran) unless the consent of the President has first been obtained. In addition, section 3 provides as a prerequisite to sale or lease of military articles to any country that the recipient country must agree to maintain the security of such articles and to provide substantially the same degree of security protection accorded to such articles by the United States government. In considering a request by a recipient country for approval of the sale of any military articles to another country, section 3 of the Act requires that the President "shall not give his consent unless the United States itself would transfer the defense article under consideration to that country." As noted below, there are legal restrictions on the United States itself transferring military articles to Iran that could be applicable. If these restrictions are applicable, it would be an issue whether the President could consent to a transfer to Iran of military articles from a legitimate recipient country. If the President were to consent to the transfer by a recipient country (e.g., Israel) to Iran, section 3 of the Act requires that he "promptly submit a report to the Speaker of the House of Representatives and to the Committee on Foreign Relations of the Senate on the implementation of" the non-transfer and use assurance agreements required by the Act. "Promptly" is not defined in the Act. Section 3 also provides that the President may not consent to a transfer by a recipient country (e.g., Israel) to a third country (e.g., Iran) of defense articles exceeding $50 million in value (in terms of their original acquisition cost), or any "major defense equipment" exceeding $14 million in value, unless he submits a detailed report concerning the transaction to Congress at least 30 calendar days before giving such consent. Omnibus Diplomatic Security and Anti-Terrorism Act of 1986. This law amended the Arms Export Control Act by adding a new section 40, which became effective on August 27, 1986. On and after that date, Munitions List items "may not be exported to any country which the Secretary of State has determined has repeatedly provided support for international terrorism.' In Secretarial Determination 84-3 (attached), the Secretary of State determined that Iran is a country which has repeatedly provided support for international terrorism. That determination has not been revoked. Exports of U.S. military equipment to Iran after August 27, 1986, would therefore be an issue under this provision. The President may, however, waive this prohibition if he determines that "the export is important to the national interests of the United States and submits to the Congress a - 3 - report justifying that determination and describing the proposed export. " The provision thus contemplates that the President's waiver will be submitted to Congress before the sale takes place. Any such waiver by the President is valid for 90 days after it is granted, unless extended by law. Prohibition on Sales to Governments Granting Sanctuary to Terrorists. Section 3(f) of the Arms Export Control Act requires that the President "shall terminate all sales under this chapter [Arms Export Control] to any government which aids or abets, by granting sanctuary for prosecution to, any individual or group which has committed an act of international terrorism." This provision of the Arms Export Control Act does not specify in what manner a determination is made that a government grants sanctuary to terrorists. However, the Secretary of State's determination that Iran is a country which has repeatedly provided support for acts of international terrorism might be applicable here. Section 3 (f) permits the President to avoid the prohibition of this section if he finds "that the national security requires otherwise." In that case, "he shall report such finding to the Speaker of the House of Representatives and the Committee on Foreign Relations of the Senate." No time period for this report is specified. We note that this section by its plain language appears to apply only to ongoing sales, credits and guaranties; it requires that the President terminate such sales, credits and guaranties, or that he may continue them if this is required by national security. This section may not, therefore, apply to a situation in which ongoing sales, credits or guaranties do not exist. License Requirement. Section 38 of the Arms Export Control Act prohibits the export of Munitions List items without a license issued under regulations implementing that section. The implementation of this section, including the authority to adopt regulations and to grant licenses, has been delegated to the Secretary of State. The requirement in this section that a license be obtained for the export of military articles is expressly made inapplicable to "exports or imports made by or for an agency of the United States government (A) for official use by a department or agency of the United States government, or (B) for carrying out any foreign assistance or sales program authorized by law and subject to the control of the President by any other means." The scope of this exception is described in the International Traffic and Arms Regulations ("ITAR"), issued by the Secretary of State. In particular, § 126.4 of the regulations states that the above-cited exception applies "only when all aspects of a transaction (export, carriage and delivery abroad) are effected - 4 - by a United States government agency, or when the export is covered by a United States government bill of lading." The regulation expressly states that the exception "does not authorize any department or agency of the U. S. government to make any export which is otherwise prohibited by virtue of other administrative provisions or by any statute." Nothing in the ITAR, however, expressly prohibits the export of Munitions List items to Iran. Export Administration Act The export of items not on the Munitions List, but which have potential military application, is generally governed by the Export Administration Act. Section 6 of the Export Administration Act requires that certain congressional committees be notified at least 30 days prior to the approval of any license for the export, to any country which the Secretary of State has determined has repeatedly provided support for acts of international terrorism, of any goods or technology worth more than $1 million which would make a significant contribution to its military potential. As indicated above, Iran has been so designated by the Secretary of State. The authority of the Export Administration Act has also been used to impose a requirement for validated licenses (and a presumption of denial) for certain categories of exports to Iran thought to have particular military application, including all aircraft and helicopters and related parts and components, and all goods and technical data subject to national security controls and destined for a military end-user or end-use. Iranian Assets Control Regulations At the time of the Iranian hostage crisis, certain Iranian properties in the United States were blocked by Executive Order 12270, issued November 14, 1979. These assets may have included, in part, military equipment purchased under contract pursuant to a legally authorized U. S. sales program. Certain press reports have speculated that military equipment previously so blocked has been shipped to Iran. Under the Iranian Assets Control Regulations issued by the Department of the Treasury on May 21, 1984, a Treasury license is required for the movement or transfer of any tangible property in which Iran has any interest whatsoever and which has potential military application. This license requirement applies to Munitions List items acquired by Iran through commercial channels prior to the hostage crisis but never exported. It does not, however, apply to items exported directly by the U. S. government. - 5 - Furthermore, the authority for the Iranian Assets Control Regulations was conferred by the President by virtue of Executive Order 12270 and the International Emergency Economic Powers Act. Any restriction in the regulations on the actions of the President, therefore, would generally be susceptible of revocation by the President himself. 2836 Federal Register / Vol. 49. No. 15 / Monday, January 23, 1984 / Notices DATE AND TIME: February 13. 1984, 8:30 PACIFIC NORTHWEST ELECTRIC DEPARTMENT OF TRANSPORTATION a.m. to 5 p.m.; and February 14. 1984, POWER AND CONSERVATION 8:30 a.m. to 12 noon. Federal Aviation Administration PLANNING COUNCIL ADDRESS: National Aeronautics and Hydropower Options Task Force; National Airspace Review; Meeting Space Administration, FB 10-B. February 13, Room 625-T. and February Regular Meeting Notice AGENCY: Federal Aviation Administration, DOT. 14. Room 226-A. 600 Independence Ave. AGENCY: Hydropower Options Task ACTION: National Airspace Review Plan SW. Washington, D.C. Force of the Pacific Northwest Electric Revision. FOR FURTHER INFORMATION CONTACT: Power and Conservation Planning Henry V. Bielstein. M.D., Code EB, Council (Northwest Power Planning SUMMARY: On April 22, 1982, the National Aeronautics and Space Council). National Airspace Review plan was Administration, Washington, DC 20546 published in the Federal Register. The ACTION: Notice of meeting. (202/453-1546). plan encompassed a review of airspace use and the procedural aspects of the air SUPPLEMENTARY INFORMATION: The Life Notice of meeting to be held pursuant traffic control system. Subsequent Sciences Advisory Committee consults to the Federal Advisory Committee Act, revisions to the schedule of various task with and advises the Council and NASA 5 U.S.C. Appendix I. 1-4. Activities will groups have been made. This notice on the accomplishments and plans of include: advises that Task Group 2-4.4, NASA's Life Sciences Programs. Review of Hydropower Options Task Helicopter Operations. Approach This meeting will be closed to the Force Charter Procedures, which was scheduled to public from 4 p.m. to 5 p.m. on February Discussion of Bonneville proposal begin February 20, 1984. has been 13 for a discussion of candidates being Discussion of Work Schedule postponed until after April 30, 1984, in considered for Committee membership. order to ensure availability of pertinent Business During this session, the qualifications of flight test data results to the task group. Public Comment. proposed new members will be candidly A specific date for this task group discussed and appraised. Since this STATUS: Open. session will be provided in a subsequent session will be concerned throughout SUMMARY: The Northwest Power notice in conjunction with other plan with matters listed in 5 U.S.C. 552(c)(6), revisions. Planning Council hereby announces a it has been determined that this session forthcoming meeting of its Hydropower FOR FURTHER INFORMATION CONTACT: should be closed to the public. The Options Task Force. National Airspace Review Program remainder of the meeting will be open to Management Staff, room 1005, Federal the public up to the seating capacity of DATE: Tuesday. January 31. 1984. 9 a.m. Aviation Administration. 800 the room (approximately 35 persons ADDRESS: The meeting will be held at Independence Avenue. SW., including committee members and other the Council Hearing Room at 700 SW. Washington. D.C. 20591. 202-426-3560. participants). Taylor: Suite 200. in Portland. Oregon. Issued in Washington. D.C., on January 11. 1984. Type of Meeting FOR FURTHER INFORMATION CONTACT: Tom Foley. (503) 222-5161. Karl D. Trautmann, Open-except for a closed session as noted Manager. Special Projects Staff Air Traffic in the agenda below. Edward Sheets. Service. Executive Director. February 13. 1984 (FR Doc. 84-1750 Filed 1-20-84: 8:45 aml [FR Doc. 64-1787 Filed 1-20-84 8:45 am] BILLING CODE 4910-13-M 8:30 a.m.-Committee Functions (Open BILLING CODE 0000-00-M session). 9 a.m.-SL-1 Preliminary Results (Open Radio Technical Commission For session). Aeronautics (RTCA), Special DEPARTMENT OF STATE 10:30 a.m.-Review Life Sciences' Program Committee 151-Airborne Microwave Plan (Open session). Office of the Secretary Landing System Area Navigation 1 p.m.-Review of Space Station Plan Equipment; Meeting (Open session). [Secretarial Determination 84-3] Pursuant to section 10(a)(2) of the 4:00 p.m.-LSAC Membership (Closed Determination Pursuant to Section 6(i) Federal Advisory Committee Act (Pub. session). of the Export Administration Act of L. 92-463; 5 U.S.C. App. I) notice is February 14. 1984 1979-Iran hereby given of a meeting of RTCA 8:30 a.m.-Status of space Biomedical Special Committee 151 on Airborne In accordance with Section 6(i) of the Institute (Open session). Microwave Landing System (MLS) Area Export Administration Act of 1979, 50 9:30 a.m.-Advocacy Paper (Open session). Navigation Equipment to be held on U.S.C. App. 2405(i), I hereby determine 12 noon-Adjourn. February 8-10. 1984. in the RTCA that Iran is a country which has Conference Room. One McPherson Dated: January 17, 1984. repeatedly provided support for acts of Square. 1425 K Street NW., Suite 500. Richard L. Daniels, international terrorism. Washington. D.C. commencing at 9:30 Director. Management Support Office. Office George P. Shultz. a.m. of Management. Secretary of State. The Agenda for this meeting is as [FR Dnc. 84-1748 Filed 1-20-84 8:45 aml FR Doc 84-1825 Filed 1-20-84 8:45 follows: (1) Chairman's Introductory BILLING CODE 7510-01-M BILLING CODE 4710-06-M Remarks: (2) Approval of Minutes of the Seen of determetion