Conference delay helps business lobby against Iran sanctions bill

Business association leaders said Friday that the delay by lawmakers in moving a new round of Iran sanctions will allow them time to push for desired changes in the bill.

Trade groups have backed the Obama administration’s efforts to earn global support for another round of multilateral sanctions against Iran for its nuclear program. But they have been fearful of language in unilateral sanctions legislation being considered by Congress that could void U.S. companies’ partnerships with foreign firms as well as possibly give overseas competitors a marketplace advantage since Congress could not stop their business with Iran.

ADVERTISEMENT
Tom Donohue, president and CEO of the U.S. Chamber of Commerce, told reporters at a breakfast hosted by the Christian Science Monitor on Friday that the business group feels the issue of Iran must be addressed but he prefers international action rather just the United States going it alone.

“Everyone supports multilateral sanctions … everybody endorses going that way,” Donohue said. “That’s better for the American business community.”

And that path is looking more likely. Last week, Sen. Chris Dodd (D-Conn.) and Rep. Howard Berman (D-Calif.), co-chairmen of the Iran sanctions bill’s conference committee, said they were holding off on moving the bill for a final vote until late June.

The reason for the pause is movement by the Obama administration in securing Chinese and Russian backing for a new United Nations Security Council resolution to penalize Iran.

Bill Reinsch, president of the National Foreign Trade Council, said it will be a heavy lift for business associations to change the bill as it is now. But the delay will give lobbyists more time to talk to lawmakers about their concerns.

“We now have more time to explain the unintended consequences,” Reinsch said. “We never want to miss an opportunity to explain what’s wrong with this bill.”

Business groups believe the law would be too punishing to U.S. business since it could prevent American companies from trading with firms that have any ties to Iran’s petroleum sector. A study by the National Association of Manufacturers estimates there could be a $25 billion drop in revenue from U.S exports as well as 210,000 jobs lost if the bill became law.

The Chamber has made that case to the bill’s conferees as well. In a May 3 letter, Bruce Josten, the business group’s chief lobbyist, said that the legislation could force U.S. aircraft manufacturers to lose credit financing, disrupt insurance for U.S. businesses and stop U.S. oil companies from exploring for energy resources around the world.

According to Donohue, at issue is one phrase in the bill that forces the president to break up contracts between American companies and international partners if the latter is found to be doing business in Iran. In turn, Donohue said the president should be given more flexibility to waive those companies — or not — from sanctions in consideration of the business impact that could have. 

“We believe the president of the United States and his colleagues ought have the discretion to decide whether to pull that trigger or not on separating American companies from partnerships that are existing all over the world. And by the way, I think the White House would like to have that discretion,” Donohue said. “Because if they don’t, it’s going to get real interesting.”

The trade group leader said it was vital to give the president that leeway due to the damage it could inflict on U.S. businesses.

“We have to figure out how to take out that one phrase out of the bill now or we are going to spend a lifetime figuring out on how to deal with it,” Donohue said.

Like Donohue, Reinsch plans to keep making the case on the bill’s collateral damage for U.S. businesses. But he does take heart from the progress being made on new multilateral sanctions against Iran.

“It makes sure all of their companies are marching in the same direction too. U.S. companies are told they can't do business in Iran but hear that their competitors can,” Reinsch said. “If their competitors are also being told not to do business in Iran, that re-creates the level playing field.”

In his letter, Josten also argued that Congress shouldn’t move on the bill until the White House could find United Nations support.

“Multilateral sanctions would be much more effective than U.S. unilateral action,” he wrote.