H.R.5711, To prohibit the Secretary of the Treasury from authorizing certain transactions by a U.S. financial institution in connection with the export or re-export of a commercial passenger aircraft to the Islamic Republic of Iran, Rules Committee Print

H.R. 5711

To prohibit the Secretary of the Treasury from authorizing certain transactions by a U.S. financial institution in connection with the export or re-export of a commercial passenger aircraft to the Islamic Republic of Iran, Rules Committee Print

Date
November 16, 2016 (114th Congress, 2nd Session)

Staff Contact
John Huston

Floor Situation

On Wednesday, November 16, 2016, the House will likely begin consideration of H.R.5711, To prohibit the Secretary of the Treasury from authorizing certain transactions by a U.S. financial institution in connection with the export or re-export of a commercial passenger aircraft to the Islamic Republic of Iran, Rules Committee Print, under a structured rule. The bill was introduced on July 11, 2016, by Rep. Bill Huizenga (R-MI) and was referred to the Committee on the Financial Services, which ordered the bill reported on July 13, 2016 by a vote of 33 to 21. The Rules Committee Print combines the text of H.R. 5711 and H.R. 5715, the No Ex-Im Assistance for Terrorism Act, as reported by the Committee.

Bill Summary

H.R. 5711 would amend current law to prohibit U.S. financial institutions from facilitating the sale of commercial aircraft to Iran. The bill prohibits the Treasury’s Office of Foreign Assets Control from authorizing U.S. financing of aircraft exports. The bill also prohibits the Export-Import Bank from directly or indirectly financing the export of U.S. goods or services sought by the Government of Iran, an entity owned or controlled by it, or an entity created under Iranian law.

Background

The Office of Foreign Assets Control (OFAC), which is part of the U.S. Department of the Treasury, administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals against targeted foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the U.S.[1]

The Export-Import (Ex-Im) Bank is the official U.S. export credit agency (ECA) and it finances and insures U.S. exports of goods and services to support U.S. jobs. On a demand-driven basis, it seeks to support exports that the private sector is unwilling or unable to finance alone at commercially viable terms for exporting; and/or to counter government-backed financing offered by foreign countries through their ECAs. The Bank’s activities are backed by the U.S. government’s full faith and credit.[2]

In September 2016, OFAC granted Airbus and Boeing licenses to sell commercial aircraft to the Iran. The licenses reportedly allow Boeing to sell 80 planes and allow Airbus to sell 17 planes. H.R. 5711 would prohibit U.S. financing for the sale of these aircraft to Iran and would prohibit the Ex-Im Bank from financing the sale of goods to Iran. The Department of State considers Iran “the world’s foremost state sponsor of terrorism,” and the Treasury Department has classified it as “a jurisdiction of primary money laundering concern.”

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[1] See U.S. Department of the Treasury OFAC, About
[2] See CRS Report, “Export-Import Bank of the United States (Ex-Im Bank),” January 6, 2016.

Cost

The Congressional Budget Office (CBO) estimates would have no significant cost to the federal government. Enacting the legislation could affect direct spending and revenues; therefore, pay-as-you-go procedures apply. However, CBO estimates that any effects on direct spending or revenues would be negligible.

Amendments

  1. Rep. Bill Huizenga (R-MI)—This amendment adds a short title and clarifies the nature of prohibited Iranian transactions. Provides for a sunset of the bill’s provisions upon Presidential certification that Iran has ceased support for international terrorism.

Additional Information

For questions or further information please contact John Huston with the House Republican Policy Committee by email or at 6-1828.