The US Congress on Thursday overwhelmingly passed tough new sanctions against Iran, sending a message to the Tehran government that notions of becoming a nuclear power could be accompanied by a steep economic price.
The Senate and House in quick succession approved the penalties that focus on Iran's powerful Revolutionary Guard and the country's imports of gas and other refined energy products.
The measure now goes to the White House for President Barack Obama's signature.
Senator John McCain, R-Ariz., said the legislation, coming after a year in which the Obama administration's direct diplomacy efforts were largely rebuffed by Iran, represented "the most powerful sanctions ever imposed by the Congress on the government of Iran."
Foreign companies will be given a choice, McCain said. "Do you want to do business with Iran, or do you want to do business with the United States?"
One provision added in final House-Senate negotiations specifies that foreign banks interacting with the Revolutionary Guard or certain Iranian banks will be shut out of the US financial system. That measure alone has "the potential to be a game changer" in Iran's defiance of international criticism of its nuclear program, said House Foreign Affairs Committee Chairman Howard Berman, D-Calif.
The Senate vote was 99-0. The House vote was 408-8.
The House passed its original version last December, and the Senate in March. But at the urging of the White House, Democratic leaders put off a final vote as they waited for diplomatic talks to play out.
Those talks culminated two weeks ago with the UN Security Council approving a fourth round of sanctions against Iran. The European Union is considering its own package of penalties and last week the Treasury Department added three dozen more companies and individuals to those blacklisted because they contribute to Iran's nuclear program or help Iran evade existing sanctions.
The Tehran government has shrugged off the latest UN penalties and says its nuclear program is for peaceful purposes.
The congressional legislation would:
- Expand the scope of the 1996 Iran Sanctions Act by penalizing foreign companies that assist Iran's energy sector. While Iran is a major exporter of oil, it relies heavily on imports for its refined products such as gasoline.
- Ban US banks from dealing with foreign banks doing business with the Revolutionary Guard or aiding Iran's nuclear program.
- Ban foreign companies from US government procurement contracts if they provide Iran with technology used to restrict the free flow of information. Iranians involved in human rights abuses would be barred from obtaining visas and be subject to having their assets in the United States seized.
- Provide a legal framework for US states, local governments and other investors to divest their portfolios of foreign companies involved in Iran's energy sector.
'One of our last best hopes'
Lawmakers from both parties stressed that the bill will be ineffective if the Obama administration, like past administrations, chooses not to punish violators in order to avoid confrontations with other countries.
"We have been profoundly unhappy over the years that successive administrations failed to implement the 1996 Iran Sanctions Act," Berman said.
The legislation represents "one of our last best hopes to force Iran to end its nuclear weapons program," said Rep. Ileana Ros-Lehtinen of Florida, top Republican on the Foreign Affairs Committee. If it is ignored as in the past, she said, "then we will have failed the American people."
Senate Banking Committee Chairman Chris Dodd, D-Conn., the top Senate negotiator on the bill, acknowledged the weak response of past presidents, but he said the new bill, while still containing waiver provisions, states "in no uncertain terms" that the president must investigate if there is credible evidence of a violation and ultimately impose sanctions.
There were other misgivings. Rep. Earl Blumenauer, D-Ore., who voted against it, said sanctions don't always have the desired effect. "Not one member of the Iranian elite will lack for gasoline while ordinary Iranians will go without," he said.
Fariborz Ghadar, a scholar and Iran expert at the Center for Strategic and International Studies, said he didn't think the new penalties would have a substantial economic impact. He said Iran's oil industry has already been hit by restrictions on direct investment and that Iran, in anticipation of sanctions on gas sales, has taken steps to reduce domestic consumption and cut dependence on gas imports from 40% of total use to less than 30%.