The U.S. House of Representatives Wednesday approved legislation that would make it easier for U.S. states and local governments and pension funds to end investments in companies helping Iran's energy sector. The vote on the Iran Sanctions Enabling Act was 414 to 6.
Under the bill, U.S. state and local governments would acquire new legal authorities that would make it easier to divest from companies investing more than $20 million in Iran's energy sector.
Like other Iran-related legislation, the Iran Sanctions Enabling Act has broad support from Democrats and Republicans who favor maintaining pressure even as the Obama administration and other nations continue talks with Iran over its nuclear program.<!-- IMAGE -->
The House Financial Services Committee chairman, Democrat Barney Frank, said while he is somewhat encouraged by what appears to be some progress in negotiations with Iran, the legislation is necessary to empower Americans to decide how and where their money is invested.
"Part of this bill today protects those states which have made the decisions by their own democratic processes, from having the federal government come in and say, no we're the federal government, we're in charge of foreign policy and you must continue to invest in Iran. Secondly, we have had a movement of citizens that say to various investment vehicles, we do not want our money invested in Iran," he said.
While the legislation itself does not impose sanctions, it extends legal protections to shield state and local governments, and investment fund managers, from civil or criminal lawsuits in response to divestment decisions.
In particular, the measure states a sense of Congress supporting decisions by employee pension plans to divest from or avoid investing assets in persons or companies with more than $20 million in Iran's energy sector.
Erik Paulsen, a Minnesota Republican, referred to the revelation in September of Iran's second uranium enrichment site, and asserted that the legislation would help persuade Iran that it must respond to international concerns about its nuclear program. "The Iranian government will be more responsive if the U.S. can isolate the regime and apply some distinct pressure that will help force Tehran to deliver on its commitments and not merely to do what it has done in the past, and that is [to] use negotiations to merely run out the clock," he said.
Similar legislation sponsored by Republican Senator Sam Brownback and Democrat Bob Casey is pending in the U.S. Senate where it has 34 co-sponsors.
One Democrat, Ohio Representative Dennis Kucinich, argued that the measure would harm efforts to have Iran respond to global concerns. "With signs of progress in these highly-sensitive talks we are proposing to set the stage to punish Iran. I think we should be doing everything we can to ensure that diplomacy and that President Obama's efforts here, succeed," he said.
The act was approved by the House of Representatives during the Bush administration, but was blocked in the U.S. Senate.
Also pending in Congress is the Iran Refined Petroleum Sanctions Act, which is backed by more than 327 House members, and 75 U.S. senators.
That measure would, among other things, expand existing U.S. sanctions, effectively prohibiting any non-U.S. company selling, or enabling the sale or transport of refined petroleum products to Iran, from doing business in the United States.
House of Representatives Foreign Affairs Committee chairman Howard Berman has said the revelation of Iran's second uranium enrichment facility reinforced his determination to move that legislation forward.
Senate Banking Committee chairman Christopher Dodd, a Democrat, has said he is readying comprehensive legislation that would merge all major sanctions measures into one bill that chamber would consider.