The Iran nuclear deal appears to be in contravention of US law, but the Obama administration has vowed to bypass these legal obstacles.
Senior US officials involved in the implementation of the Iran nuclear deal have concluded that a key component of the deal that relates to the relief of sanctions on Iran, a concession to Iran that will open the doors to tens of billions of dollars in US-backed commerce with the Islamic regime, conflicts with existing federal statutes and cannot be implemented without violating those laws, Fox News reports.
The problematic codicil of the agreement lays with section 5.1.2 of Annex II, which provides that in exchange for Iranian compliance with the terms of the deal, the US “shall…license non-US entities that are owned or controlled by a US person to engage in activities with Iran that are consistent with this JCPOA ( the Joint Comprehensive Plan of Action).”
This means that foreign subsidiaries of US parent companies will, under certain conditions, be allowed to do business with Iran.
The problem is that the Iran Threat Reduction and Syria Human Rights Act (ITRA), signed into law by President Barack Obama in August 2012, was explicit in closing the so-called “foreign sub” loophole, meaning that what is prohibited for US parent firms has to be prohibited for foreign subsidiaries, and what is allowed for foreign subsidiaries has to be allowed for US parent firms.
There are a number of other commerce-related legal issues that have arisen in the wake of the nuclear accord, which is championed by Obama.
As the Iran deal is an “executive agreement” and not a treaty – and has moreover received no vote of ratification from the Congress, explicit or symbolic – legal analysts inside and outside of the Obama administration have concluded that the deal is vulnerable to challenge in the courts, where federal case law had held that US statutes trump executive agreements in force of law, Fox News explained.
Legal Battle Looming?
Administration sources told Fox News that Secretary of State John Kerry intends to defend the deal he negotiated if it is challenged in court. However, according to analysis offered by Fox News, the only legal option is for the Obama administration to violate federal law when implementing the agreement with the Islamic Republic.
At the State Department on Thursday, spokesman John Kirby told reporters Secretary Kerry is “confident” that the administration “has the authority to follow through on” the commitment to re-open the foreign subsidiary loophole.
“Under the International Emergency Economic Powers Act, the president has broad authorities, which have been delegated to the secretary of the Treasury, to license activities under our various sanctions regimes, and the Iran sanctions program is no different,” Kirby said.
Senator Ted Cruz (R -Tx), an ardent critic of the Iran deal, charged that the re-opening of the loophole fits a pattern of the Obama administration enforcing federal laws selectively.
“It’s a problem that the president doesn’t have the ability wave a magic wand and make go away,” Cruz told Fox News in an interview. “Any US company that follows through on this, that allows their foreign-owned subsidiaries to do business with Iran, will very likely face substantial civil liability, litigation and potentially even criminal prosecution. The obligation to follow federal law doesn’t go away simply because we have a lawless president who refuses to acknowledge or follow federal law.”
By: United with Israel Staff
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