Senior U.S. officials have said anonymously that the Obama administration will violate federal law by implementing the Iran nuclear agreement.
A sanctions relief provision included in the deal that directs the U.S. to allow foreign subsidiaries of U.S. businesses "to engage in activities with Iran" if Tehran abides by the deal’s stipulations violates a law signed by President Obama in 2012 that closed this foreign subsidiary loophole.
Fox News reported:
[The law, the Iran Threat Reduction and Syria Human Rights Act (ITRA)] also stipulated, in Section 218, that when it comes to doing business with Iran, … what is prohibited for U.S. parent firms has to be prohibited for foreign subsidiaries, and what is allowed for foreign subsidiaries has to be allowed for U.S. parent firms. What’s more, ITRA contains language, in Section 605, requiring that the terms spelled out in Section 218 shall remain in effect until the president of the United States certifies two things to Congress: first, that Iran has been removed from the State Department’s list of nations that sponsor terrorism, and second, that Iran has ceased the pursuit, acquisition, and development of weapons of mass destruction.
The Iran Nuclear Agreement Review Act, which Obama signed in May before the nuclear agreement was finalized, holds that "any measure of statutory sanctions relief" provided to Iran in the deal must be "taken consistent with existing statutory requirements for such action."
As Iran remains on the State Department’s list of countries that sponsor terrorism, the Obama administration would be violating the 2012 law by implementing the nuclear deal and allowing foreign subsidiaries to do business with Iran, the officials concluded.
While the State Department spokesman John Kirby expressed "confidence" Thursday that the administration has the authority to implement the provision of the deal related to foreign subsidiaries, Sen. Ted Cruz (R., Texas), a lawyer, said companies that allow foreign subsidiaries to engage in business with Iran could face criminal prosecution.
Lawmakers have previously accused the president of breaking the law in relation to the nuclear deal. Nearly 100 House Republicans, led by House Majority Leader Kevin McCarthy (R., Calif.), sent a letter to the president in August suggesting he was violating the Iran Nuclear Agreement Review Act by refusing to disclose side deals related to the agreement to Congress as it reviewed the deal.
Obama never released the side deals, but an apparent draft of one of the undisclosed agreements indicated that Iran would be able to use its own experts to inspect the Parchin nuclear site believed to have housed nuclear arms development.