January 14, 1998

TEXT OF A LETTER FROM THE PRESIDENT TO THE SPEAKER OF THE HOUSE OF REPRESENTATIVES AND THE PRESIDENT OF THE SENATE

Message Creation Date was at 14-JAN-1998 15:48:00
      
THE WHITE HOUSE

Office of the Press Secretary

________________________________________________________________

For Immediate Release                           January 14, 1998



TEXT OF A LETTER FROM THE PRESIDENT
TO THE SPEAKER OF THE HOUSE OF REPRESENTATIVES
AND THE PRESIDENT OF THE SENATE


                        January 13, 1998



Dear Mr. Speaker: (Dear Mr. President:)

I hereby report to the Congress on the developments since my last report of 
June 26, 1997, concerning the national emergency with respect to Libya that was 
declared in Executive Order 12543 of January 7, 1986.  This report is submitted 
pursuant to section 401(c) of the National Emergencies Act, 50 U.S.C. 1641(c); 
section 204(c) of the International Emergency Economic Powers Act (IEEPA), 50 
U.S.C. 1703(c); and section 505(c) of the International Security and 
Development Cooperation Act of 1985, 22 U.S.C. 2349aa-9(c).

1.  On January 2, 1998, I renewed for another year the national emergency with 
respect to Libya pursuant to IEEPA.  This renewal extended the current 
compre-hensive financial and trade embargo against Libya in effect since 1986.  
Under these sanctions, virtually all trade with Libya is prohibited, and all 
assets owned or controlled by the Libyan government in the United States or in 
the possession or control of U.S. persons are blocked.

2.  There have been two amendments to the Libyan Sanctions Regulations, 31 
C.F.R. Part 550 (the "LSR" or the "Regula-tions"), administered by the Office 
of Foreign Assets Control (OFAC) of the Department of the Treasury, since my 
report of June 26, 1997. The Regulations were amended on August 25, 1997.  
General reporting, record-keeping, licensing, and other procedural regulations 
were moved from the Regulations to a separate part (31 C.F.R. Part 501) dealing 
solely with such procedural matters (62 Fed. Reg. 45098, August 25, 1997).  A 
copy of the amendment is attached.

On September 15, 1997, the Regulations were amended to add to appendices A and 
B to 31 C.F.R. chapter V the name of one entity and one individual who have 
been determined to act for or on behalf of, or to be owned or controlled by, 
the Government of Libya (62 Fed. Reg. 48177, September 15, 1997).  A copy of 
the amendment is attached.

3.  During the reporting period, OFAC reviewed numerous applications for 
licenses to authorize transactions under the Regulations.  Consistent with 
OFAC's ongoing scrutiny of banking transactions, the largest category of 
license approvals (32) concerned requests by non-Libyan persons or entities to 
unblock transfers interdicted because of what appeared to be Government of 
Libya interests.  Five licenses authorized the provision of legal services to 
the Government of Libya in connection with 

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actions in U.S. courts in which the Government of Libya was named as 
defendant.  Licenses were also issued authorizing diplomatic and U.S. 
government transactions, and to permit U.S. companies to engage in transactions 
with respect to intellectual property protection in Libya.  A total of 49 
licenses was issued during the reporting period.

4.  During the current 6-month period, OFAC continued to emphasize to the 
international banking community in the United States the importance of 
identifying and blocking payments made by or on behalf of Libya.  The OFAC 
worked closely with the banks to assure the effectiveness of inter-diction 
software systems used to identify such payments.  During the reporting period, 
more than 70 transactions potentially involving Libya, totaling more than $4.4 
million, were interdicted.  As of November 10, 1997, 8 transactions had been 
authorized for release, leaving a net amount of more than $4.3 million blocked 
for the period.

5.  Since my last report, OFAC collected 7 civil monetary penalties totaling 
more than $77,000 for violations of the U.S. sanctions against Libya.  Five of 
the violations involved the failure of banks to block funds transfers or loan 
syndication payments to Libyan-owned or -controlled financial institutions or 
commercial entities in Libya.  One U.S. corporation and one law firm paid OFAC 
penalties for export and payment to the Government of Libya violations, 
respectively.  Fifty-five other cases are in active penalty processing.

Various enforcement actions carried over from previous reporting periods have 
continued to be aggressively pursued.  On June 26, 1997, a Federal grand jury 
for the Middle District of Florida returned an indictment charging a St. 
Petersburg, Florida man with one count of conspiring to violate IEEPA and the 
Libyan Sanctions Regulations, two counts of dealing in property in which the 
Government of Libya has an interest, one count of purchasing goods (airline 
tickets) for export from Libya, and one count for transactions to evade and 
avoid the prohibitions of the LSR.  The defendant remains a fugitive and 
warrants have been issued for his arrest.  Numerous investigations are ongoing 
and new reports of violations are being scrutinized.

6.  The expenses incurred by the Federal Government in the 6-month period from 
July 7, 1997, through January 6, 1998, that are directly attributable to the 
exercise of powers and authorities conferred by the declaration of the Libyan 
national emergency are estimated at approximately $620,000.00.  Personnel costs 
were largely centered in the Department of the Treasury (particularly in the 
Office of Foreign Assets Control, the Office of the General Counsel, and the 
U.S. Customs Service), the Department of State, and the Department of Commerce.

7.  The policies and actions of the Government of Libya continue to pose an 
unusual and extraordinary threat to the national security and foreign policy of 
the United States.  In adopting UNSCR 883 in November 1993, the United Nations 
Security Council determined that the continued failure of the Government of 
Libya to demonstrate by concrete actions its renunciation of terrorism, and in 
particular its continued failure to respond fully and effectively to the 
requests and decisions of the Security Council in Resolutions 731 and 748, 
concerning the bombing of the Pan Am 103 and UTA 772 flights, constituted a 
threat to international peace and security.  The United States will continue to 
coordinate its comprehensive sanctions enforce-ment efforts with those of other 
U.N. member states.  We remain determined to ensure that the perpetrators of 
the terrorist acts against Pan Am 103 and UTA 772 are brought to justice.  The 

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families of the victims in the murderous Lockerbie bombing and other acts of 
Libyan terrorism deserve nothing less.  I shall continue to exercise the powers 
at my disposal to apply economic sanctions against Libya fully and effectively, 
so long as those measures are appropriate, and will continue to report 
periodi-cally to the Congress on significant developments as required by law.

      Sincerely,



      WILLIAM J. CLINTON



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