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federal reserve ban k of

DALLAS, TEXAS

Dallas

75222

C i r c u l a r No. 7 9-18 7
N ovem ber 26, 1979

IRANIAN ASSETS CONTROL REGULATIONS
TO ALL BANKS
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
Enclosed is the text of the Iranian A ssets Control Regulations prom­
ulgated by the Office of Foreign A ssets Control, U. S. T r e a s u ry Department,
as p u b lished in the Federal Register of November 15, 1979.
The reg u latio n s, as d e sc rib e d by the T r e a s u r y , include g eneral
licenses that, in part:
1.

A uthorize (Sec. 5 3 5 .5 3 1 ), until December 14, 1979, payments from
blocked Iranian accounts in connection with checks an d d rafts draw n
or issued p rio r to November 14, 1979, provided:
a.

b.

2.

the amount involved in any one paym ent does not exceed $500,
or the check or d raft was w ithin the United States in the pro ­
c e ss of collection by a domestic ban k on or p r io r to the effective
date and does not exceed $ 5 0 ,0 0 0 , and
no payments to Iran or an y Iranian entity a r e authorized except
by deposit into a blocked account in a domestic bank unless
Iran o r the Iranian entity is o th erw ise licensed to receive such
paym ent.

A uthorize (Sec. 53 5 .5 3 2) the completion, on or before November 21, 1979,
of p u rc h a se s or sales made p rio r to November 14, 1979, of secu rities
p u rch ased o r sold for the account of Iran o r an Iranian entity,
pro vid ed that:
a.

the proceeds of such sales a r e cred ited to a blocked account
in the same name of the p erso n for whose account the sale
was made, and

b.

any s ecu rities so p u rc h a se d a r e held in such blocked account.

B a n k s and o th e rs are e n c o u ra g e d to use th e fo llo w in g in c o m in g W A T S n u m b e rs in c o n ta c tin g th is B ank:
1-800-442-7140 (in tra s ta te ) a nd 1-800-527-9200 (in te rs ta te ). F o r c a lls p la c e d lo c a lly , p le a se use 651 p lu s th e
e x te n s io n re fe rre d to above.

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

-2 -

3.

Authorize (Sec. 53 5 .9 0 1)
other tra n s f e rs from an y
bank located in a foreign
bank is a person subject

domestic ban ks to effect w ithdraw als o r
account held in the name of a non-Iranian
co untry un less that nonlranian foreign
to U . S. ju risd ic tio n .

In our C ircu lar No. 79185 dated November 19, 1979, you w ere
fu rn ish ed amendments ad ding Sections 5 3 5 .3 2 0 , 5 3 5 .5 0 8 , 5 3 5 .5 3 3, 5 3 5.903,
5 3 5 .9 0 4 and 535.902 to the reg ulation . Enclosed is a T r e a s u r y Department
announcem ent p ro v id ing the text of additional amendments effective November
19, 1979.
Sincerely y o u rs,
Robert H. Boykin
F irs t Vice P resident

Enclosures

DEPARTMENT OF THE TREASURY
I
Office of Foreign Assets Control
31 CFR Part 535
Iranian Assets Control Regulations

AGENCY:

Office of Foreign Assets Control.

ACTION:

Final rule.

SUMMARY:

The Office of Foreign Assets Control is amending the Iranian

Assets Control Regulations.

The purpose of the amendments is to make avail­

able to the public certain basic definitions,

interpretations, general

licenses, and procedures contained in sections that were reserved w h e n the
Regulations were issued on November 15, 1979 (44 Fed. Reg. 65956).

The need

for the amendments is that the Regulations, as published contemporaneously with
Executive Order 12170 declaring a national emergency and blocking Iranian
assets, of necessity omitted certain essential provisions.
definitions,

These include

interpretations, general licenses, and procedures which affec­

ted persons need in order to fully understand and properly comply w i t h the
Regulations.

The effect of the amendments is that business enterprises,

attorneys, and other members of the public will have available to them
appropriate guidance on the proper interpretation of the Regulations, the
standards and procedures for obtaining specific licenses, and other matters.
EFFECTIVE DATE:

November 19, 1979

FOR FURTHER INFORMATION CONTACT:
Dennis M. O'Connell
Chief Counsel
Office of Foreign Assets Control
Department of the Treasury
Washington, D.C.
20220
(202) 376-0236

-2-

SUPPUJMENTARY INFORMATION:
function,

Since the regulations involve a foreign affairs

the provisions of the Administrative Procedure Act, 5 U.S.C. 553,

requiring notice of proposed rulemaking,
pation and a delay in effective date are

the opportunity for public partici­
inapplicable.

The Iranian Assets Control Regulations are amended by the addition
of the following sections:
Subpart C -- General Definitions
*
§535.316

License.

Except as otherwise specified,
license

the term "license" shall mean

any

or authorization contained in or issued pursuant to this part.
§535.317

General license.

A general license is any license or authorization the terms of
w h i c h are set forth in this part.
§535.318

Specific license.

A specific license is any license or authorization issued pursuant
to this part but not set forth in this part.
§535.320
(a)

Domestic b a n k .
The term "domestic bank" shall mean any branch or office

w i t h i n the United States of any of the following which is not Iran or an
Iranian entity:

any bank or trust company incorporated under the banking

laws of the United States or of any state, territory, or district of the
United States, or any private bank or banker subject to supervision and
examination under the banking laws of the United States or of any state,
territory or district of the United States.

The Secretary of the Treasury

may also authorize any other banking institution to be treated as a

-3"domestic bank" for the purpose of this definition or for the purpose of any
or all sections of this part.
(b)

For purposes of §§535.413, 535.508, 535.531 and 535.901, the

term "domestic bank" includes any branch or office within the United States
of a non-Iranian foreign bank.
§535.321

United States: continental United S t ates.

The term "United States" means the United States and all areas
under the jurisdiction or authority thereof including the Trust Territory
of the Pacific Islands.

The term "continental United States" means the

states of the United States and the District of Columbia.
§535.413

Transfers between dollar accounts held for foreign b a n k s .

Transfers authorized by §535.901 include transfers by order of a nonIranian foreign bank from its account in a domestic bank (directly or through
a foreign branch or subsidiary of a dometic bank)

to an account held by a

domestic bank (directly or through a foreign branch or subsidiary) for a
second non-Iranian foreign bank which in turn credits an account held by it
abroad for Iran.

For the purposes of this section, a non-Iranian foreign bank

means a bank which is not a person subject to the jurisdiction of the United
States.
Subpart E —
§535.502
(a)

Licenses, Authorizations and Statements of Licensing Policy

Effect of subsequent license or authorization.
No license or other authorization contained in this part or

otherwise issued by or under the direction of the Secretary of the Treasury
pursuant to section 203 of the International Emergency Economic Powers Act,
shall be deemed to authorize or validate any transaction effected prior to

the issuance thereof, unless such license or other authorization specifically
so provides.
(b)

No regulation, ruling, instruction, or license authorizes a

transaction prohibited under this part unless the regulation, ruling,
instruction or license is issued by the Treasury Department and specifically
refers to this part.

)
No regulation, ruling, instruction or license referring

to this part shall be deemed to authorize any transaction prohibited by any
provision of Parts 500, 505, 515, 520 or 530 of this chapter unless the r e g u ­
lation, ruling,

instruction or license specifically refers to such provision.

§535.503

Exclusion from licenses and authorizations.

The Secretary of the Treasury reserves the right to exclude any
person from the operation of any license or from the privileges therein c on­
ferred or to restrict the applicability thereof with respect to particular
persons,

transactions or property or classes thereof.

Such action shall be

binding upon all persons receiving actual notice or constructive notice thereof.
§535.566

Unblocking of foreign currency deposits held by U.S.-owned

or controlled foreign fir m s .
Deposits held abroad in currencies other than U.S. dollars by
branches and subsidiaries of persons subject to the jurisdiction of the
United States are unblocked, provided however that conversions of blocked
dollar deposits into foreign currencies are not authorized.
Subpart H -- Procedures
§535.801
(a)

Lic e n s i n g .
General licenses.

General licenses have been issued author­

izing under appropriate terms and conditions many types of transactions

-5which are subject to the prohibitions contained in Subpart B of this part.
All such licenses are set forth in Subpart E of this part.

It is the policy

of the Office of Foreign Assets Control not to grant applications for specific
licenses authorizing transactions to which the provisions of an outstanding
general license are applicable.

Persons availing themselves of certain general

licenses are required to file reports and statements in accordance

w i t h the

instructions specified in the licenses.
(b)

Specific licenses -- (1)

Transactions subject to the prohibitions

General course of procedure.
contained in Subpart B of this part

wh i c h are not authorized by general license may be effected only under specific
license.

The specific licensing activities of the Office of Foreign Assets

Control are performed by its Washington Office and by the Federal Reserve Bank
of New York.

W h e n an unusual problem is presented,

the proposed action is

cleared with the Director of the Office of Foreign Assets Control or such
person as he may designate.
(2)

Applications for specific licenses.

Applications for specific

licenses to engage in any transaction prohibited by or pursuant to this part
are to be filed in duplicate on Form TFAC-27 with the Federal Reserve Bank of
New York.

Any person having an interest in a transaction or proposed trans­

action may file an application for a license authorizing the effecting of
such transaction, and there is no requirement that any other person having
an interest in such transaction shall or should join in making or filing
such application.
(3)

Information to be supplied.

Applicant must supply all infor­

mation specified by the respective forms and instructions.

Such documents

as m a y be relevant shall be attached to each application as a part of such
application except that documents previously filed with the Office of Foreign
Assets Control may, where appropriate, be incorporated by reference.

Appli­

cants may be required to furnish such further information as is deemed n e c e s ­
sary to a proper determination by the Office of Foreign Assets Control.

If

an applicant or other party in interest desires to present additional infor­
mat i o n or discuss or argue the application, he may do so at any time before
or after decision.

Arrangements for oral presentation should be made with

the Office of Foreign Assets Control.
(4)

Effect of d e n i a l .

The denial of a license does not preclude

the reopening of an application or the filing of a further application.

The

applicant or any other party in interest may at any time request explanation
of the reasons for a denial by correspondence or personal interview.
(5)

Reports under specific licenses.

issuance of any license,

As a condition upon the

the licensee may be required to file reports with

respect to the transaction covered by the license,

in such form and at such

times and places as may be prescribed in the license or otherwise.
(6)

Issuance of l icense.

Licenses will be issued by the Office

of Foreign Assets Control acting on behalf of the Secretary of the Treasury
or by the Federal Reserve Bank of New York, acting in accordance w i t h such
regulations, rulings and instructions as the Secretary of the Treasury or
the Office of Foreign Assets Control may from time to time prescribe,

in

such cases or classes of cases as the Secretary of the Treasury or the
Office of Foreign Assets Control may determine, or licenses may be issued
by the Secretary of the Treasury acting directly or through any person,
agency, or instrumentality designated by him.

-7 §535.802

Unblocking

Any interested person desiring the unblocking of accounts
or other property on the ground that neither Iran or any Iranian entity
has an interest in the property may file such an application.

Such

application shall be filed in the manner provided in §535.801(b) and
shall contain full information in support of the administrative action
requested.
The applicant is entitled to be heard on the application.

If

the applicant desires a hearing, arrangements should be made with the
Office of Foreign Assets Control.
§535.803

Decision.

The Office of Foreign Assets Control or the Federal Reserve
Bank of New York will advise each applicant of the decision respecting
applications filed by him.

The

decision of the Office

of Foreign Assets

Control acting on behalf of the

Secretary of the Treasury

an application shall constitute

final agency action.

§535.804

Records and

with respect

to

reporting.

Records are required to be kept by every person engaging in any
transaction subject to the provisions of this part.
Reports may be required from any person with respect to any
transaction subject to the provisions of this chapter or relative to
any property in w h i c h any foreign country or any national thereof has any
interest.

-8-

§535.805

Amendment, modification, or revocation.

The provisions of this part and any rulings, licenses, authori­
zations, instructions, orders, or forms issued thereunder m ay be amended,
modified, or revoked at any time.

Dated:

19 NOV 1979

(s) Stanley L. Sommerfield
Stanley L. Sommerfield
Director

A p p r o v e d : (s) Richard J. Davis
Richard J. Davis
Assistant Secretary

I


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102