House panel aiming to halt Boeing's sale of jets to Iran

House panel aiming to halt Boeing's sale of jets to Iran
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A House subcommittee on Thursday will debate three bill aimed at halting Boeing’s sale of passenger jets to Iran.

The House Financial Services Subcommittee on Monetary Policy and Trade plans to debate the measures aimed at stopping the largest U.S. business transaction with Iran since the 1979.

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"Tomorrow's hearing will examine the Obama administration's nuclear agreement with Iran and how it opened the door for the sale of American made aircraft to the world's leading state sponsor of terror,” said Rep. Bill Huizenga (R-Mich.), the subcommittee’s chairman.

“I am extremely concerned that by relaxing the rules, the Obama administration has allowed U.S. companies to be complicit in weaponizing the Iranian regime," Huizenga said.

Last month, Timothy Keating, senior vice president of government operations at Chicago-based Boeing, responded to a letter from committee leaders saying that Congress knew the sale was passenger jets was part of the negotiations of the nuclear agreement.

"It was made clear to us in those consultations that that the ability to provide Iranian airlines with U.S. and European replacement commercial passenger aircraft for their aging fleets was key and essential to reaching closure on the agreement,” Keating said in a letter. 

The deal was announced at the end of June.

The subcommittee plans to discuss legislation to prevent certain transactions by U.S. financial institutions with Iran as well as prohibiting the Export-Import bank from financing projects in Iran.

Another bill would prohibit the Treasury Department's Office of Foreign Assets Control (OFAC) from licensing the sale and lease of aircraft by Boeing.

The Ex-Im Bank and Boeing have each made clear that financing the deal through the agency is prohibited because the State Department has labeled Iran a state sponsor of terrorism.

House Financial Services Committee Chairman Jeb Hensarling (R-Texas) and Rep. Peter Roskam (R-Ill.) wrote a letter to Boeing last month calling Iran “terrorism’s central supplier” and said “American companies should not be complicit in weaponizing the Iranian Regime.”

Witnesses scheduled to appear at Thursday’s hearing plan to voice similar concerns, according to their submitted testimony.

"Boeing and those banking this deal face a due diligence nightmare,” according to testimony by Mark Dubowitz of the Foundation for Defense of Democracies.

Boeing is expected to sell 80 airliners worth $17.6 billion with deliveries set to begin in 2017 and finish in 2025.

Iran Air also intends to lease 29 737s from Boeing. France-based Airbus also is expected to sell planes to Iran.

“[T]he sale of such aircraft to Iran, and in particular to Iran Air, raises serious concerns that such planes will be used to traffic illicit arms and militants to Syria in support of Syrian President Bashar al-Assad, to Hezbollah in Lebanon and to militants in Yemen," wrote Eric Lorber of the Financial Integrity Network in testimony sent to the committee.

"This fear is warranted: as recent research has shown, Iran Air — as well as still-designated entities like Mahan Air — regularly flies commercial aircraft to Syria and Lebanon that are known to — or suspected of — transporting arms, cash from illicit activities, or foreign militants,” Lorber wrote.