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Bush Lifts Trade, Transportation Sanctions on Libya

President Bush has lifted trade, commercial and travel sanctions on Libya with an executive order declaring an end to the national emergency declared by former president Ronald Reagan in January 1986.

The executive order, dated September 20 and set to take effect September 21, states that Libya's commitments and actions to eliminate its weapons of mass destruction (WMD) programs and Missile Technology Control Regime (MTCR) class missiles have significantly altered the potential threat to U.S. national security that the 1986 executive order sought to address.

"The progress in US-Libyan relations reflects the cooperation and support exhibited by Libyan officials and experts over the last nine months. As a result, concerns over weapons of mass destruction no longer pose a barrier to the normalization of U.S.-Libyan relations," according to a White House press statement.

The press statement documents numerous measures taken by the Libyan government to rid itself of WMD, including the destruction of munitions, the conversion of production facilities, the opening of facilities to international inspections and the removal of highly enriched uranium for its research reactor. Libya also has signed the International Atomic Energy Agency (IAEA) Additional Protocol and agreed to stop all military trade with countries of proliferation concern.

The executive order ends the need for U.S. businesses to seek special licenses for trade with Libya and paves the way for the resumption of direct air service between the two countries. The order also lifts sanctions on the importation of refined Libyan petroleum products into the United States.

In addition, the order allows U.S. government agencies to promote U.S. investment in Libya and unblocks Libyan assets that had been frozen under the 1986 executive order.

In a message to Congress, Bush clarified that this order does not eliminate sanctions on Libya resulting from Libya's designation as a state sponsor of terrorism. In particular, the White House press statement noted the administration's concerns regarding allegations of Libyan involvement in an assassination plot against Saudi Crown Prince Abdullah.

"We welcome Libya's formal renunciation of terrorism and Libyan support in the global war against terrorism, but we must establish confidence that Libya has made a strategic decision that is being carried out in practice by all Libyan agencies and officials," the statement said.

As a consequence of this executive order, the administration expects Libya to move ahead with the payment of more than $1 billion in compensation to families of the victims of Pan Am flight 103. Libya has accepted responsibility for the bombing of that airplane, which exploded over Lockerbie, Scotland, in December 1988, killing 270 people.

The press statement also said that the Bush administration would seek to work with Libya in the areas of education, health care, scientific training, and political and economic reform. According to the statement, "The United States supports Libya's efforts to reap the benefits of engagement, including prosperity and security for its citizens."

Following are the texts of the White House press statement, the executive order, Bush's message to Congress, a memorandum to the secretaries of state, agriculture and commerce, and a memorandum to the secretary of the treasury:

THE WHITE HOUSE
Office of the Press Secretary
(Derry, New Hampshire)
September 20, 2004

STATEMENT BY THE PRESS SECRETARY

Today, the United States has reached another milestone in the President's effort to combat the proliferation of weapons of mass destruction and the means of their delivery. Over the last nine months, Libya has worked with international organizations and the United States and United Kingdom to eliminate its WMD and longer-range missile programs in a transparent and verifiable manner. Libya's efforts open the path to better relations with the United States and other free nations.

These accomplishments are significant. Libya facilitated the removal of all significant elements of its declared nuclear weapons program, signed the IAEA Additional Protocol, began a process of converting the Rabta facility to a pharmaceutical plant, destroyed chemical munitions and secured chemical agent for destruction under international supervision, declared its chemical agents to the Organization for the Prevention of Chemical Weapons, eliminated its Scud-C missile force, and agreed to eliminate its Scud-B missiles. Libya turned over nuclear weapons documentation, removed highly enriched uranium for its research reactor and equipment for uranium enrichment, allowed international personnel site access, and pledged to halt all military trade with countries of proliferation concern. Revelations by Libya greatly aided the international community's effort to understand and cripple the global black market in the world's most dangerous technologies.

Libya has also agreed to an ongoing trilateral arrangement in which the United States, the United Kingdom and Libya will address any other WMD-related issues as well as to further projects for mutual cooperation such as redirection of Libyan WMD personnel. The progress in US-Libyan relations reflects the cooperation and support exhibited by Libyan officials and experts over the last nine months. As a result, concerns over weapons of mass destruction no longer pose a barrier to the normalization of US-Libyan relations.

At the beginning of this process, the President committed to respond to concrete Libyan actions in good faith, noting that Libya "can regain a secure and respected place among the nations and, over time, better relations with the United States." In recognition of these achievements and our assessment that Libya has continued to meet the standard it set on December 19 to eliminate WMD and MTCR-class missiles and other developments, the President has:

-- Terminated the national emergency declared in 1986 under the International Emergency Economic Powers Act (IEEPA), and revoked related Executive Orders. This rescinds the remaining economic sanctions under IEEPA and ends the need for Treasury Department licences for trade with Libya. It also permits direct air service and regular charter flights, subject to standard safety and other regulatory requirements. This action also unblocks assets belonging to Libyan and non-Libyan entities that were frozen when the national emergency was imposed.

-- Adopted, as a general policy, the strategy of providing a level playing field for US business in Libya through the use of U.S. Government programs such as those administered by the Departments of Agriculture and Commerce, the Export-Import Bank, Overseas Private Insurance Corporation, and Trade Development Agency, as well as to waive the prohibitions on the availability of foreign tax credits. This policy will be furthered through the use of statutory waiver authorities where necessary and in some cases through proposed legislative relief from sanctions that would otherwise stand in the way.

As a result, we expect the families of the victims of Pan Am 103 to receive over $1 billion in additional compensation from Libya. The determination and courage of the Pan Am 103 families, in almost sixteen years of efforts to hold Libya accountable before the world, contributed greatly to efforts to secure an agreement under which Libya agreed to end all its WMD programs and pledged to end all connections with terrorism.

In conjunction with U.S. action to unblock frozen assets, with respect to the remaining cases brought against it by U.S. victims of terrorism Libya has reaffirmed to us that it has a policy and practice of carrying out agreed settlements and responding in good faith to legal cases brought against it, including court judgments and arbitral awards. We expect Libya to honor this commitment.

The US will continue its dialogue with Libya on human rights, political and economic modernization, and regional political developments. We welcome Libya's engagement with Amnesty International. We also share the European Community's concern over the plight of the Bulgarian medics. Diplomatic engagement and cooperation in education, health care, and scientific training can build the foundation for stronger relations. The United States supports Libya's efforts to reap the benefits of engagement, including prosperity and security for its citizens. As the President stated in December, 2003, "Should Libya pursue internal reform, America will be ready to help its people to build a more free and prosperous country." None of today's actions change Libya's status as a State Sponsor of Terrorism. We remain seriously concerned by the allegations of Libyan involvement in an assassination plot against Crown Prince Abdullah of Saudi Arabia and we have raised our concerns with the Libyan government. These concerns must be addressed. We welcome Libya's formal renunciation of terrorism and Libyan support in the global war against terrorism, but we must establish confidence that Libya has made a strategic decision that is being carried out in practice by all Libyan agencies and officials.

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EXECUTIVE ORDER: TERMINATION OF EMERGENCY DECLARED IN EXECUTIVE ORDER 12543 WITH RESPECT TO THE POLICIES AND ACTIONS OF THE GOVERNMENT OF LIBYA AND REVOCATION OF RELATED EXECUTIVE ORDERS

Office of the Press Secretary
(Derry, New Hampshire)
For Immediate Release
September 20, 2004

EXECUTIVE ORDER

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TERMINATION OF EMERGENCY DECLARED IN EXECUTIVE ORDER 12543 WITH RESPECT TO THE POLICIES AND ACTIONS OF THE GOVERNMENT OF LIBYA AND REVOCATION OF RELATED EXECUTIVE ORDERS

By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.) (NEA), section 5 of the United Nations Participation Act, as amended (22 U.S.C. 287c) (UNPA), sections 504 and 505 of the International Security and Development Cooperation Act (22 U.S.C. 2349aa-8 and 2349aa-9), section 40106 of title 49, United States Code, and section 301 of title 3, United States Code,

I, GEORGE W. BUSH, President of the United States of America, find that the situation that gave rise to the declaration of a national emergency in Executive Order 12543 of January 7, 1986, with respect to the policies and actions of the Government of Libya, and that led to the steps taken in that order and in Executive Order 12544 of January 8, 1986, and Executive Order 12801 of April 15, 1992, has been significantly altered by Libya's commitments and actions to eliminate its weapons of mass destruction programs and its Missile Technology Control Regime (MTCR) class missiles, and by other developments. Accordingly, I hereby terminate the national emergency declared in Executive Order 12543, and revoke that Executive Order, Executive Order 12544, and Executive Order 12801. I also hereby revoke Executive Order 12538 of November 15, 1985, and further order:

Section 1. Pursuant to section 202(a) of the NEA (50 U.S.C. 1622(a)), termination of the national emergency declared in Executive Order 12543 with respect to the policies and actions of the Government of Libya shall not affect any action taken or proceeding pending not finally concluded or determined as of the effective date of this order, any action or proceeding based on any act committed prior to such date, or any rights or duties that matured or penalties that were incurred prior to such date.

Sec. 2. This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, instrumentalities, or entities, its officers or employees, or any other person.

Sec. 3. (a) This order is effective at 12:01 a.m. eastern daylight time on September 21, 2004.

(b) This order shall be transmitted to the Congress and published in the Federal Register.

GEORGE W. BUSH

THE WHITE HOUSE, September 20, 2004.

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MESSAGE TO THE CONGRESS OF THE UNITED STATES

THE WHITE HOUSE

Office of the Press Secretary
(Derry, New Hampshire)
For Immediate Release
September 20, 2004

TO THE CONGRESS OF THE UNITED STATES:

Consistent with subsection 204(b) of the International Emergency Economic Powers Act, 50 U.S.C. 1703(b)(IEEPA), I hereby report that I have issued an Executive Order (the "order") that terminates the national emergency declared in Executive Order 12543 of January 7, 1986, and revokes that Executive Order, Executive Order 12544 of January 8, 1986, Executive Order 12801 of April 15, 1992, and Executive Order 12538 of November 15, 1985. I have determined that the situation that gave rise to this national emergency has been significantly altered by Libya's commitments and actions to eliminate its weapons of mass destruction programs and its Missile Technology Control Regime (MTCR) -class missiles, and by other developments.

Executive Order 12543 of January 7, 1986, imposed sanctions on Libya in response to policies and actions of the Government of Libya that constituted an unusual and extraordinary threat to the national security and foreign policy of the United States. Those sanctions were modified in Executive Order 12544 of January 8, 1986, Executive Order 12801 of April 15, 1992, and supplemented Executive Order 12538 of November 15, 1985.

Based on Libya's recent commitments and actions to implement its December 19, 2003, commitment to eliminate its weapons of mass destruction programs and its MTCR-class missiles, and other developments, I have determined that the situation that gave rise to the national emergency declared in Executive Order 12543 has been significantly altered. My order, therefore, terminates that national emergency with respect to Libya and revokes Executive Orders 12543, 12544, and 12801, and lifts the trade, commercial, and travel sanctions imposed against Libya based on that national emergency. The order also revokes Executive Order 12538, which blocked the import of petroleum products refined in Libya into the United States.

While the order formally lifts sanctions under the national emergency with respect to Libya, it will not lift a wide variety of other sanctions imposed on Libya due to its designation as a state sponsor of terrorism under section 620A of the Foreign Assistance Act (restriction on foreign assistance), section 40 of the Arms Export Control Act (restriction on arms exports), and section 6(j) of the Export Administration Act of 1979 (restriction on exports of certain items on the Commodity Control List), as well as other statutory restrictions applicable to Libya.

I have enclosed a copy of the order, which is effective at 12:01 a.m. eastern daylight time on September 21, 2004.

GEORGE W. BUSH

THE WHITE HOUSE, September 20, 2004.

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MEMORANDUM FOR THE SECRETARY OF STATE, THE SECRETARY OF AGRICULTURE, AND THE SECRETARY OF COMMERCE

THE WHITE HOUSE

Office of the Press Secretary
(Derry, New Hampshire)
For Immediate Release
September 20, 2004

September 20, 2004

Presidential Determination No. 2004-49

MEMORANDUM FOR THE SECRETARY OF STATE THE SECRETARY OF AGRICULTURE THE SECRETARY OF COMMERCE

SUBJECT: Determination and Waiver of Application of Section 908(a)(1) of the Trade Sanctions Reform and Export Enhancement Act of 2000 with Respect to Libya

By virtue of the authority vested in me by the Constitution and laws of the United States, including section 908(a)(3) of the Trade Sanctions Reform and Export Enhancement Act of 2000, title IX, Public Law 106-387 (TSRA), I hereby determine that waiver of the application of section 908(a)(1) of TSRA with respect to Libya is in the national security interest of the United States and hereby waive the application of that section with respect to Libya.

The Secretary of State is hereby authorized and directed to report this determination and waiver to the Congress and to arrange for its publication in the Federal Register.

GEORGE W. BUSH

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MEMORANDUM FOR THE SECRETARY OF THE TREASURY

THE WHITE HOUSE

Office of the Press Secretary
(Derry, New Hampshire)
For Immediate Release
September 20, 2004

September 20, 2004

Presidential Determination No. 2004-48

MEMORANDUM FOR THE SECRETARY OF THE TREASURY

SUBJECT: Intention to Grant Waiver of the Application of Section 901(j) of the Internal Revenue Code with Respect to Libya

By virtue of the authority vested in me by the Constitution and the laws of the United States, including section 901(j)(5) of the Internal Revenue Code (the "Code") and section 301 of title 3, United States Code:

(a) I hereby determine that the waiver of the application of section 901(j)(1) of the Code with respect to Libya is in the national interest of the United States and will expand trade and investment opportunities for U.S. companies in Libya;

(b) I intend to grant such a waiver with respect to Libya; and

(c) I authorize and direct you to report to the Congress in accordance with section 901(j)(5)(B) of the Code my intention to grant the waiver and the reason for this determination and to arrange for publication of this determination in the Federal Register.

GEORGE W. BUSH

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