Full text of Press Releases of the United States Department of the Treasury : Volume 301

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iepartment of ihe Treasury

~

FOR RELEASE WHEN AUTHORIZED

1, 1990

August

Washington,

O.C. ~ Telephone 566-2041

AT PRESS CONFERENCE

CONTACT:

TREASURY AUGUST QUARTERLY

Office of Financing
202/376-4350

FINANCING

will raise about $12, 225 million of new cash
and refund $20, 018 million of securities maturing August 15,
1990, by issuing $11,500 million of 3-year notes, $10, 500 million
of 10-year notes, and $10, 250 million of 30-year bonds. The
$20, 018 million of maturing securities are those held by the
public, including $3, 176 million held, as of today, by Federal
Reserve Banks as agents for foreign and international monetary
The Treasury

authorities.

three issues totaling $32, 250 million are being offered
and any amounts tendered by Federal Reserve Banks
as agents for foreign and international monetary authorities
will be added to that amount. .Tenders for such accounts will be
accepted at the average prices of accepted competitive tenders.
The

to the public,

to the public holdings, Federal Reserve Banks
of the maturing securities for their own
accounts, which may be refunded by issuing additional amounts of
the new securities at the average prices of accepted competitive
In addition

hold $3, 068 million

tenders.

will chan e this auction schedule unless
assurance of enactment of le islation to raise the statutor
limit b Au ust 6 1990.
The Treasur

be

The

it

has

debt

10-year note and 30-year bond being offered today will

eligible for the

STRIPS program.

Details about each of the new securities are given in the
attached highlights of the offering and in the official offering

circulars.

oOo

Attachment

epartmeni of the treasury

~ Washlnyion,

FOR RELEASE WHEN AUTHORIZED

1, 1990

August

D.C. ~ telephone 566-Roc

AT PRESS CONFERENCE

CONTACT:

TREASURY AUGUST QUARTERLY

Office of Financing
202/376-4350

FINANCING

The Treasury will raise about $12, 225 million of new cash
and refund $20, 018 million of securities maturing August 15,
1990, by issuing $11,500 million of 3-year notes, $10, 500 million
of 10-year notes, and $10, 250 million of 30-year bonds. The
$20, 018 million of maturing securities are those held by the
public, including $3, 176 million held, as of today, by Federal
Reserve Banks as agents for foreign and international monetary

authorities.

The three issues totaling $32, 250 million are being offered
to the public, and any amounts tendered by Federal Reserve Banks
as agents for foreign and international monetary authorities
will be added to that amount. .Tenders for such accounts will be
accepted at the average prices of accepted competitive tenders.
In addition to the public holdings, Federal Reserve Banks
hold $3, 068 million of the maturing securities for their own
accounts, which may be refunded by issuing additional amounts of
the new securities at the average prices of accepted competitive

tenders.

will chan e this auction schedule unless
assurance of enactment of le islation to raise the statutor
limit b Au ust 6 1990.
The Treasur

it

has

debt

10-year note and 30-year bond being offered today will
be eligible for the STRIPS program.
Details about each of the new securities are given in the
attached highlights of the offering and in the official offering
The

circulars.

oOo

Attachment

NB-904

OF TREASURY OFFERINGS TO THE PUBLIC
1990 QUARTERLY FINANCING

HIGHLIGHTS

AUGUST

August

....

Offered to the Public

Amount

Descri tion of Securit

for

CUSIP Nos.

:

security

Term and type of
Series and CUSIP

.

$11,500 million
3-year notes
Series U-1993
(CUSIP No. 912827
Not applicable

designation

STRIPS Components

Interest rate

7)

ZD

Interest

.

available

Minirass denomination
Amount

required

Terms
Method

of Sale:
of sale

for

tenders

Competitive

STRIPS

..

~

Must be

tenders

Payment

by

investors

.

two

e. g. , 7. 10X

e. g. ,

9)
A

of offering circular
August 15, 1990
August 15, 2020

based on
the average of accepted bids
To be determined at auction
To be determined after auction

To be determined

February

15

15 and August

$1,000
To be determined

after auction

Yield auction
expressed as

Must be

yield with

an annual

decimals,

Bonds of 2020
(CUSIP No. 912810 EG
Listed in Attachment

two

7e10X

an annual

decimals,

yield with

two

e.g. , 7. 10X

Accepted in full at the average
price up to $1,000, 000

Accepted in full at the average
price up to $1,000, 000

Full payment to be
submitted with tender

Full payment to be
submitted with tender

Full payment to be
submitted with tender

Acceptable

Acceptable

Acceptable

in full at the average
to $1,000, 000

Accepted

price
Accrued interest
payable by investor

To be determined

Yield auction
expressed as

yield with

an annual

decimals,
Noncompetitive

5)
(CUSIP No. 912827
Listed in Attachment A
of offering c&rcular
August 15, 1990
August 15, 2000
ZE

Yield auction
expressed as

Must be

~

30-year bonds

$5, 000
Not applicable

To be determined at auction
To be determined after auction
February 15 and August 15

or discount
payment dates

Premium

10-year notes

based on
the average of accepted bids
To be determined at auction
To be determined after auction
February 15 and August 15
$1, 000
To be determined after auction

the average of accepted bids

yield

Investment

$10, 250 million

Series C-2000

August 15, 1990
August 15, 1993
To be determined based on

Issue date
Maturity date

$10, 500 million

1, 1990

up

None

non-institutional

.

Deposit guarantee by
designated institutions

.

Dates:
Receipt of tenders

~te

Settlement
due from

(final payment
institutions):

a) funds immediately
available to the Treasury
b) readily-collectible check

Tuesday,

August

7, 1990,

prior to 1:00 p. m. ,

EDST

August 15, 1990
August 13, 1990

llednesday,

August

8, 1990,

prior to 1:00 p. m. ,

EDST

August 15, 1990
August 13, 1990

lJednesday,

lIednesday,

Monday,

Monday,

Thursday,

August

9, 1990,

prior to 1:00 p. m. ,

EDST

Mednesday, August 15, 1990
Monday, August 13, 1990

HIGHLIGHTS

OF TREASURY OFFERINGS TO THE PUBLIC
1990 OUARTERLY FINANCING

AUGUST

August

Offered to the Public

Amount

Term and type of
Series and CUSIP

security

$10, 500 million

$10, 250 million

3-year notes

10-year notes

Series U-1993

Series C-2000

30-year bonds
Bonds of 2020
(CUSIP No. 912810 EG 9)
Listed in Attachment A
of offering circular
August 15, 1990

$11,500 million

:

Descri tion of Securit

~

designation

(CUSIP No. 912827

for STRIPS Cosponents

CUSIP Nos.

Not

Issue date
Maturity date

the average of accepted bids
To be determined at auction
To be determined after auction

yield
or discount
Interest payment dates
Investment

Premium

Minirass denomination
Amount

required

Terms
Method

of Sale:
of sale

~

avai labl e

for STRIPS

tenders

Competitive

~

February

tenders

Accepted

price

Payment

based on

the average of accepted bids
To be determined at auction
To be determined after auction
February

15 and August

15

after auction

Yield auction
expressed as

two

in full at the average
to $1,000, 000

an annual

decimals,

based on

the average of accepted bids
To be determined at auction
To be determined after auction
February

15 and August

15

$1,000
To be determined

after auction

Yield auction
expressed as

Must be

e. g. , 7. 10X

August 15, 2020
To be determined

Must be

yield with

two

e. g. , 7. 10X

an annual

decimals,

yield with

two

e.g. , 7. 10X

Accepted in full at the average
price up to $1,000, 000

Accepted in full at the average
price up to $1,000, 000

None

~

non-institutional

by

investors

up

To be determined

To be determined

Must be

yield with

(CUSIP No. 912827 ZE 5)
Listed in Attachment A
of offering circular
August 15, 1990
August 15, 2000

$1, 000

Yield auction
expressed as

.

an annual

Accrued interest
payable by investor

15

15 and August

$5, 000
Not applicable

decimals,
Noncompetitive

7)

ZD

applicable

August 15, 1990
August 15, 1993
To be determined based on

Interest rate

1, 1990

~

Deposit guarantee by
designated institutions

..

Dates:
Receipt of tenders

Full payment to be
submitted with tender

submi

Full payment to be
t ted w i th tender

Full payment to be
submitted with tender

Acceptable

Acceptable

Acceptable

Tuesday, August 7, 1990,
prior to 1:00 p. m. , EDST

Wednesday,

Wednesday, August 15, 1990
Monday, August 13, 1990

Wednesday, August 15, 1990
Monday, August 13, 1990

~te

Settlement
due from

(final payment
institutions):

a) funds immediately
available to the Treasury
b) readily-collectible

check

August

8, 1990,

prior to 1:00 p. m. ,

EDST

Thursday,

August

9, 1990,

prior to 1:00 p. m. ,

EDST

Wednesday, August 15, 1990
Monday, August 13, 1990

department

of ihe Treasury

~ Washlngion,

FOR RELEASE WHEN AUTHORIZED

August

1, 1990

D.C. ~ Telephone S66-20

AT PRESS CONFERENCE

CONTACT:

Office of Financing
202/376-4350

TREASURY OFFERS $10, 000 MILLION
OF 36-DAY CASH MANAGEMENT BILLS

The Department of the Treasury, by this public notice,
invites tenders for approximately $10, 000 million of 36-day
Treasury bills to be issued August 15, 1990, representing an
additional amount of bills dated March 22, 1990, maturing

September

20, 1990 (CUSIP No. 912794

VC

5).

Competitive tenders will be received at all Federal Reserve
Banks and Branches prior to 12:00 noon, Eastern Daylight Saving
time, Thursday, August 9, 1990. Each tender for the issue must
be for a minimum amount of $1, 000, 000. Tenders over $1, 000, 000
must be in multiples of $1, 000, 000. Tenders must show the yield
desired, expressed on a bank discount rate basis with two
decimals, e. g. , 7. 154. Fractions must not be used.
Noncompetitive tenders will not be accepted.
not be received at the Department of the Treasury,

Tenders will
Washington.

this auction unless it has
assurance of enactment of le islation to raise the statuto
debt limit b Au ust 6 1990.
The Treasu

ma

reschedule

bills will

be issued on a discount basis under competiand-at
tive bidding,
maturity their par amount will be payable
without interest.
The bills will be issued entirely in bookentry form in a minimum denomination of $10, 000 and in any higher
$5, 000 multiple, on the records of the Federal Reserve Banks and
Branches. Additional amounts of the bills may be issued to
Federal Reserve Banks as agents for foreign and international
monetary authorities at the average price of accepted competitive
The

tenders.

institutions and dealers who make primary markets
securities and report daily to the Federal Reserve
Bank of New York their positions in and borrowings on such securities may submit tenders for account of customers, if the names
of the customers and the amount for each customer are furnished.
Others are only permitted to submit tenders for their own account.
Each tender must state the amount of any net long position in the
bills being offered if such position is in excess of $200 million.
This information should reflect positions held as of 11:30 a. m. ,
Eastern time, on the day of the auction. Such positions would
include bills acquired through "when issued" trading, futures,
Banking

in Government

department

of ihe Treasury

~

FOR RELEASE WHEN AUTHORIZED

August

1, 1990

Washlngion,

D.c. ~ Telephone %66-204i

AT PRESS CONFERENCE

CONTACT:

Office of Financing
202/376-4350

TREASURY OFFERS $10, 000 MILLION
OF 36-DAY CASH MANAGEMENT BILLS

The Department of the Treasury, by this public notice,
invites tenders for approximately $10, 000 million of 36-day
Treasury bills to be issued August 15, 1990, representing an
additional amount of bills dated March 22, 1990, maturing

September

20, 1990 (CUSIP No. 912794

VC

5).

Competitive tenders will be received at all Federal Reserve
Banks and Branches prior to 12:00 noon, Eastern Daylight Saving
time, Thursday, August 9, 1990. Each tender for the issue must
be for a minimum amount of $1, 000, 000. Tenders over $1, 000, 000
must be in multiples of $1, 000, 000. Tenders must show the yield
desired, expressed on a bank discount rate basis with two
decimals, e. g. , 7. 154. Fractions must not be used.
Noncompetitive tenders will not be accepted.
not be received at the Department of the Treasury,

Tenders will
Washington.

The Treasu
ma
reschedule this auction unless it has
assurance of enactment of le islation to raise the statuto
debt limit b Au ust 6 1990.

bills will be issued on a discount basis under competitive bidding, and at maturity their par amount will be payable
without interest.
The bills will be issued entirely in bookThe

entry form in a minimum denomination of $10, 000 and in any higher
$5, 000 multiple, on the records of the Federal Reserve Banks and
Branches. Additional amounts of the bills may be issued to
Federal Reserve Banks as agents for foreign and international
monetary authorities at the average price of accepted competitive

tenders.

institutions and dealers who make primary markets
securities and report daily to the Federal Reserve
Bank of New York their positions in and borrowings on such securities may submit tenders for account of customers, if the names
of the customers and the amount for each customer are furnished.
Others are only permitted to submit tenders for their own account.
Each tender must state the amount of any net long posit'. on in the
bills being offered if such position is in excess of $200 million.
This information should reflect positions held as of 11:30 a. m. ,
Eastern time, on the day of the auction. Such positions would
include bills acquired through "when issued" trading, futures,
Banking

in Government

transactions as well as holdings of outstanding
bills with the same maturity date as the new offering, e. g. ,
bills with three months to maturity previously offered as sixDealers, who make primary markets in Government,
month bills.
securities and report daily to the Federal Reserve Bank of New
York their positions in and borrowings on such securities, when
submitting tenders for customers, must submit a separate tender
for each customer whose net long position in the bill being
offered exceeds $200 million.
and forward

deposit need accompany tenders from incorporated banks
and trust companies and from responsible and recognized dealers
in investment securities.
Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Those
submitting tenders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly reserves
the right to accept or reject any or all tenders, in whole or in
part, and the Secretary's action shall be final. The calculation
of purchase prices for accepted bids will be carried to three
decimal places on the basis of price per hundred, e. g. , 99.923.
Settlement for accepted tenders in accordance with the bids must
be made or completed at the Federal Reserve Bank or Branch in cash
or other immediately-available
funds on Wednesday, August 15, 1990.
No

If a bill is purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
Department of the Treasury Circulars, Public Debt SeriesNos. 26-76 and 27-76, and this notice, prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars may be obtained from any Federal Reserve Bank or

Branch.

transactions as well as holdings of outstanding
bills with the same maturity date as the new offering, e. g. ,
bills with three months to maturity previously offered as sixmonth bills.
Dealers, who make primary markets in Government
securities and report daily to the Federal Reserve Bank of New
York their positions in and borrowings on such securities, when
submitting tenders for customers, must submit a separate tender
for each customer whose net long position in the bill being
offered exceeds $200 million.
and forward

No

and

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers

trust

in investment

securities.

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Those
submitting tenders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly reserves
the right to accept or reject any or all tenders, in whole or in
part, and the Secretary's action shall be final. The calculation
of purchase prices for accepted bids will be carried to three
decimal places on the basis of price per hundred, e. g. , 99.923.
Settlement for accepted tenders in accordance with the bids must
be made or completed at the Federal Reserve Bank or Branch in cash
or other immediately-available
funds on Wednesday, August 15, 1990.

If

bill is

purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.

a

Department of the Treasury Circulars, Public Debt SeriesNos. 26-76 and 27-76, and this notice, prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars may be obtained from any Federal Reserve Bank or

Branch.

TALKING POINTS
FOR THE
FINANCING PRESS CONFERENCE

August

Today we

quarterly

are announcing

refunding.

1, 1990

the terms of our regular August

However,

since Congress has not completed

action on legislation to increase the debt ceiling, I am only
able to announce a tentative schedule of the auctions and
settlement of the refunding issues. We will announce the final
auction schedule as soon as there is assurance of enactment of
legislation to raise the statutory debt limit. We are hopeful
that an increase in the debt ceiling will be enacted in a timely
manner.

I will also discuss

the Treasury's

financing

requirements

for the balance of the current calendar quarter and our estimated
cash needs for the October-December 1990 quarter.

1.
refund

We

are offering $32. 25 billion of notes and bonds to

$20. 0 billion of privately-held

15 and to raise approximately

notes maturing

$12. 25 billion of cash.

on August

The

three

securities are:

First,
maturing

a 3-year note in the amount

15, 1993. This note is scheduled to
a yield basis on Tuesday, August 7. The

on August

be auctioned
minimum

of $11.50 billion

on

denomination

will be $5, 000.

TALKING POINTS
FOR THE
FINANCING PRESS CONFERENCE

August

Today we

quarterly

the terms of our regular August

are announcing

refunding.

1, 1990

However,

since Congress has not completed

legislation to increase the debt ceiling, I am only
able to announce a tentative schedule of the auctions and
settlement of the refunding issues. We will announce the final
auction schedule as soon as there is assurance of enactment of
legislation to raise the statutory debt limit. We are hopeful
that an increase in the debt ceiling will be enacted in a timely

action

on

manner.

I will also discuss

the Treasury's

financing

requirements

for the balance of the current calendar quarter and our estimated
cash needs for the October-December 1990 quarter.

1.
refund

We

are offering $32. 25 billion of notes and bonds to

$20. 0 billion of privately-held

15 and to raise approximately

notes maturing

$12. 25 billion of cash.

on August

The

three

securities are:

First,
maturing

a 3-year note in the amount

minimum

15, 1993. This note is scheduled

on August

be auctioned

on a

of $11.50 billion

yield basis

denomination

on Tuesday,

will be $5, 000.

August

7.

to
The

--

of $10.50 billion
maturing on August 15, 2000. This note is scheduled to
be auctioned on a yield basis on Wednesday, August 8.
The minimum denomination will be $1, 000.
Second, a 10-year note in the amount

Third, a 30-year bond maturing

August

15, 2020 in the

of $10.25 billion. This bond is scheduled to be
auctioned on a yield basis on Thursday, August 9. The
amount

denomination

minimum

We

will be $1, 000.

will accept noncompetitive

tenders

up

to $1, 000, 000 for each

of these issues.

2.

are also offering $10 billion of 36-day cash

We

bills

management

maturing

bills are

scheduled

Thursday,

August

15.

August

The

It

20, 1990. The cash management

to be auctioned on a discount basis on
9, at 12:00 noon for settlement Wednesday,
minimum denomination
will be $1, 000, 000.

tenders will not be accepted.

Noncompetitive

3.

September

will be necessary to change the auction schedule,

the Treasury does not have assurance

6.

of final action

is the last

if

on the debt

final
Congressional action could occur in time for the Treasury to
auction securities on August 14 and settle them on August 15. If
Congress does wait until August 13 to act, Treasury's financing
limit

by August

August

13

day on which

--

of $10.50 billion
maturing on August 15, 2000. This note is scheduled to
be auctioned on a yield basis on Wednesday, August 8.
will be $1, 000.
The minimum denomination

--

Third, a 30-year bond maturing

Second, a 10-year note in the amount

August

15, 2020 in the

of $10.25 billion. This bond is scheduled to be
auctioned on a yield basis on Thursday, August 9. The
amount

We

will be $1, 000.

denomination

minimum

will accept noncompetitive

tenders

up

to $1, 000, 000 for each

of these issues.

2.

are also offering $10 billion of 36-day cash

We

bills

management

maturing

bills are

scheduled

Thursday,

August

15.

August

The

It

to be auctioned on a discount basis on
9, at 12:00 noon for settlement Wednesday,
minimum denomination
will be $1, 000, 000.

will be necessary to change the auction schedule,

the Treasury does not have assurance

limit

20, 1990. The cash management

tenders will not be accepted.

Noncompetitive

3.

September

6.

of final action

is the last

on

if

the debt

final
Congressional action could occur in time for the Treasury to
auction securities on August 14 and settle them on August, 15. If
Congress does wait until August 13 to act, Treasury's financing
by August

August.

13

day on which

options will be limited and costly.

4.

For the current July-September

net market borrowing
Treasury borrowing

the Resolution

need

to finance Federal Financing

Trust Corporation,

depending

upon

we

estimate a

of $63. 5 billion, which includes

balance at the end of September.

balance,

quarter,

and assumes
We may

our assessment

want

Bank lending

a $30

to

to

billion cash

have a higher

of cash needs at the time.

this refunding, we will have raised $40. 1 billion
of the $63. 5 billion in net market borrowing needed this JulyIncluding

September

quarter.

This net borrowing

was accomplished

as

follows:

$3. 4 billion of cash
settled July 2;
$3. 4 billion of cash

from the

2-

and

4-year notes which

from the 7-year note

that settled

July 16;

$2. 9 billion of cash from the 2-year note which settled
July 31;

$15. 0 billion of cash in regular weekly bills, including
the

bills

announced

yesterday;

$3. 1 billion of cash in 52-week bills; and
$12. 25 billion of cash from the refunding issues
announced

The

today.

$23. 4 billion to be raised in the rest of the July-September

options will be limited and costly.

4.

quarter,

For the current. July-September

net market borrowing
Treasury

borrowing

the Resolution

need of $63. 5

Trust Corporation,

depending

which

to finance Federal Financing

balance at the end of September.

balance,

billion,

upon

and assumes
We may

our assessment

we

want

estimate a

includes

Bank lending

a $30

to

to

billion cash

have a higher

of cash needs at the time.

this refunding, we will have raised $40. 1 billion
of the $63. 5 billion in net market borrowing needed this JulyIncluding

September

quarter.

This net borrowing

was accomplished

as

follows:

$3. 4 billion of cash
settled July 2;
$3. 4 billion of cash

from the

2-

from the

7-year note that settled

and

4-year notes which

July 16;

$2. 9 billion of cash from the 2-year note which settled
July 31;

$15. 0 billion of cash in regular weekly bills, including
the

bills

announced

yesterday;

$3. 1 billion of cash in 52-week bills; and
$12. 25 billion of cash from the refunding issues
announced

The

today.

$23. 4 billion to be raised in the rest of the July-September

quarter could be accomplished

bills,

and 52-week

sales of regular 13-, 26-,

through

a 2-year note in August

note in early September.

Additional

and a

5-year 2-month

bills

cash management

be

may

necessary to cover the low point in the cash balance in early
September.

billion cash management bills announced yesterday
the $10 billion cash management bills announced today mature
The $4

20.

September

and

Since these bills will be issued and mature within

the July-September

quarter

they do not

affect the net

market

total.

borrowing

5.

We

estimate Treasury net market borrowing

to be

needs

in the range of $65 to $70 billion for the October-December

quarter,

assuming

Treasury's

quarter

its

billion cash balance

October-December

any allowance

update

a $30

for

FFB lending

market borrowing

borrowing

to the
estimate

as soon as the Oversight

on December

31.

estimate does not include
RTC.

Treasury

plans to

for the October-December

Board has reviewed

and approved

the RTC's working capital budget for that period.

6.

We

anticipate

will be announced
settlement

that the next auction of

on October

October 16.

The

REFCORP bonds

2, for auction October 9, and

quarter could be accomplished

bills,

and 52-week

sales of regular 13-, 26-,

through

a 2-year note in August

note in early September.

and a

5-year 2-month

bills

cash management

Additional

be

may

necessary to cover the low point in the cash balance in early
September.

billion cash management bills announced yesterday
the $10 billion cash management bills announced today mature
The $4

20.

September

Since these bills will be issued and mature within

the July-September

quarter

they do not

5.

We

estimate Treasury net market borrowing

in the range of $65 to $70 billion

quarter,

assuming

Treasury's

its

a $30

market

for

FFB lending

market borrowing

borrowing

to the
estimate

as soon as the Oversight

to be

needs

for the October-December

billion cash balance

October-December

any allowance

quarter

affect the net

total.

borrowing

update

and

on December

31.

estimate does not include
RTC.

Treasury

plans to

for the October-December

Board has reviewed

and approved

the RTC's working capital budget for that period.

6.

We

anticipate

will be announced
settlement

that the next auction of

on October

October 16.

The

REFCORP bonds

2, for auction October 9, and

7.

The

10-year notes and 30-year bonds announced

today

will be eligible for conversion to STRIPS (Separate Trading of
Registered Interest and Principal of Securities) and,
accordingly,
components.

may

be divided

into separate interest and principal

7

The

10-year notes and 30-year bonds announced

today

will be eligible for conversion to STRIPS (Separate Trading of
Registered Interest and Principal of Securities) and,
accordingly, may be divided into separate interest and principal
components.

TREASURY FINANCING
April -

$Bil.
100

Uses

REQUIREMENTS

June 1990

$Bil.
100

Sources

94'/4

90

90

80

80

70

Coupon g
Maturities &

70

C oupon
Refunding

60

60

50
40

3/4

Foreign
Nonmarketables

20

)

Deficit

J1

Department of the Treasury
Office of Market Finance

50
Domestic Series
'/4

&&I

30

10

Savings
Bonds
2

Increase in
Cash Balance

1

40

30

State 8 Local

Net Market
Borrowing

~J

~

~

-20

10

Includes budget deficit, changes in accrued interest and checks
outstanding, transfer of $3'/2 billion of REFCORP bond proceeds
to RTC, and minor miscellaneous debt transactions.
July 31, 1999-19

TREASURY FINANCING
April -

$Bil.
100

Uses

REQUIREMENTS

June 1990

$Bil.
100

Sources

94'/4

90

90

80

80

i

70

70

C oupon
Refunding

Coupon
Maturities &

60

60

50
40

30

Foreign
Nonmarketables

]Deficit

J1

Department of the Treasury
Office of Market Finance

50
Domestic Series
'/4

40

30

'/4

20
10

Savings
Bonds
2

Increase in
Cash Balance

State

8 Local

Net Market
Borrowing

Jr

ii

20
10

Includes budget deficit, changes in accrued interest and checks
outstanding, transfer of $3'/2 billion of REFCORP bond proceeds
to RTC, and minor miscellaneous debt transactions.
July 31, 1990-19

TREASURY FINANCING
July

$Bil.

-

REQUIREMENTS

September 1990

$Bil.

131 '/4

Uses

Sources

120

120
Coupon
Maturities

100

Coupon
Refunding

~

State and
80

Savings
Bonds

Local
41/2

~

'/4

60

100

Foreign
Non-Marketables

80

2

W~

~W

/4

60

Domestic

Series

~

Net Market
Borrowing

40

]Deficit

tl

~

I~

40

Decrease
in Cash
Balance R 20

63'/2

20
~

~

41/2

Includes budget deficit, changes in accrued interest and checks
outstanding, transfer of $5 billion of REFCORP bond proceeds to
RTC, and minor miscellaneous debt transactions.
j2' Issued or announced through July 27, 1990.
Assumes a $30 billion cash balance September 30, 1990.
Q3
g1

Department of the Treasury
Office of Market Finance

July 31, 1990-20

TREASURY FINANCING
July

$Bil.

-

REQUIREMENTS

September 1990

$Bil.

131 '/4

Uses

Sources

120

120
Coupon
Maturities

100

W

Coupon
Refunding

State and
80

Savings
Bonds

Local
3/4

40

Foreign
Non-Marketables

)

80

2

41/2

60

100

~W

'/4

60

Domestic

Series

~

~

Net Market
Borrowing

Deficit

-'r

40

Decrease
in Cash
Balance 3J 20

63'/2

20
~

~

41/2

Includes budget deficit, changes in accrued interest and checks
outstanding, transfer of $5 billion of REFCORP bond proceeds to
RTC, and minor miscellaneous debt transactions.
j2' Issued or announced through July 27, 1990.
Assumes a $30 billion cash balance September 30, 1990.
Q3
+1

Department of the Treasury
Office of Market Finance

July 31, 1990-20

TREASURY OPERATiNG CASH BALANCE
Semi- Monthly

$Bil.
40

Total Operating
Balance

Tax and Loan
Accounts

$

Without New
Borrowing f

Balance

30

20:.:,'::
10

~a

:':::':;::;:::':,
:.:,:.:i~ ~s
. :':.
. :.:'.::;::,
~~;::::::::::&::.
'::::i~
"::.";;;&:;:::::.
: &i&y«ii',&»i
41i'&'i« iii&ii:::::na&

PP

0

&49&'rs'::::
ii&iijj"'::::::::;
. 'j'i«
ii" q+
'
&pi&&i

&&i&&'

i

~ j&

—10
—20
—30
—40
—50
—60

~
~
~
~

c i i'j '&s»i jj
&

i&y

j'

~
~
~
~

ifiii'i&iisi'&iiai&iirii«&r»'« ia'iiiii i&'iiiii«&ii«»»»«»&'

Federal Reserve Account

~
~

Jul

Aug

Sep Oct
1989
J1

Department of the Treasury
Office of Market Finance

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

~
~
~
~
~ ~
ee

Sep

1990
Assumes refunding of maturing issues, excluding CMB
maturing September 20 and FTN maturing August 15.
July 31, 1990-18

TREASURY OPERATING CASH BALANCE
Semi- Monthly

$Bil.

40

Total Operating

Tax and Loan
Accounts
Balance

Balance)

30

Without New
Borrowing f

20:::::::

~
~ ~~

10"''
0

—10
—20
—30
—40
—50
—60

:,

t"'r '::::;:;:,::;::,
',':;:,"::,
';:;:,',':,',':,',',';,',':~k
'::::;:::::::::s
rrIrrii.r&it
. . . , iiYii ~fi''
, ,
it&~
':::::::
':;.

e'::;::::::::::.
"::::::;::::::::::::::::::
tiliiiir 're%
4'isa ~ 'r«rri'::::::::~w&

"iib~

'~ry

' "iir
rei
Jjjrte
"rnrriitiiiiyiiiriiitiij'iiiniiiiiirli

~

lirirniiiiiiilii

Iiiiiii

Federal Reserve Account

~
~

~

~
~
~ ~
~ ~
~ ~
ee

~

Jul

Aug

Sep Oct
1989
j1

Department of the Treasury
Office of Market Finance

Nov

Dec

Jan

Feb Mar

Apr

May

Jun

Jul

Aug

Sep

1990
Assumes refunding of maturing issues, excluding CMB
maturing September 20 and FTN maturing August 15.
July 31, 199048

TREASURY NET MARKET BORROWING~
SBil.
70

Coupons

EH Over 10 yrs.

63 1/2

gg 2 —10 yrs.

60

55.0

51.2

50
35.3

40

39.6

r-w

I

I
I

Bills

W

I
I
I
I
I

I
I

52.8

I

48.3

To Be
Done~
~

16.8

37.0
34.0

33.0

17.3

30

$Bil.
70

I
I

I

33.5

32.0

32.6

5.3

i

I
I
I
I

g
~

60
50
40

30

20

20

10

10

0

0

-10

—10

-20

-20
I

I I

I I I

1986

I

V

I

I I

I I I

1987

I

V

I

I I

111

1988

~1Excludes Federal Reserve and Government
Department of the Treasury
Office of Market Finance

I

V

I

I I

II I

I

1989

V

I

I I

I I I

1990

Account Transactions.
July 31, 1990-13

TREASURY NET MARKET BORROWING~
$Bil.
70

Coupons

EH Over 10 yrs.

63 1/2

58 2 —10 yrs.

60

55.0

I'
I
I

Bills

50

52.8

48.3

35.3

40

I
I

I

51.2

I

I

To Be
Done~

39.6

16.8
34.0

33.0

17.3

30

I

37.0

33.5

32.0

326

I
I

I

I

g

I
I

g

5.3

60

I

I
I
I

51.1

1I

$Bil.
70

50
40

30

I

~

20

20

10

10

0

0

-10

-10

-20

-20
I

I I

I I I

I

V

I

I I I

1987

1986
~tExcludes
Department of the Treasury
Office of Market Finance

I I

I

V

I

I I

I I I

1988

Federal Reserve and Government

I

V

I

I I

I I I

I

1989

V

I

I I

I I I

1990

Account Transactions.
July 31, 1990-13

C

$Mil

NET NEW CASH FROM NONCOMPETITIVE
IN WEEKLY BILL AUCTIONS'

TENDERS
Discount Rate %

500
400

300

8.0

~ePe'a

e

ee

7.8

200

7.6

100

7, 4

0

7.2

-100

~
~
~

Net New Cash

-200
-30Q

—1000

26 Week
13 Week

DIScount Rate
~ ~& 26 Week
13 Week

—1100
—1700

(Left scale)

(Right Scale)

—1800
Aug

Department of the Treasury
Office of Market Finance

Sep

Oct * Nov
1989

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

'

1990

j1Excludes noncompetitive tenders from foreign official accounts.
8 No noncompetitive rollovers allowed in bill auctions.
i'

Preliminary

July 31, 1990-7

$Mil

NET NEW CASH FROM NONCOMPETITIVE
IN WEEKLY BILL AUCTIONS'

TENDERS
Discount Rate %

500

8.0

400
4ee 'a

e

300

pq

7.8

I
ek

200

7.6

100

7.4

0

7.2

-100

~
~
~

Net New Cash

-200

-300
—1000

(Left scale)

26 Week
13 Week

DiSCOunt Rate (Right Scale)
~
26 Week

»~

—1100
—1700

13 Week

—1800
Aug

Sep

*

Oct

Nov

Jan

Dec

1989

Feb

Mar

Apr

May

Jun

Jul

'

1990

~1Excludes noncompetitive
Department of the Treasury
Office of Market Finance

8
P

No noncompetitive
Preliminary

tenders from foreign official accounts.
rollovers allowed in bill auctions.
July 31, 1990-7

NONCOMPETITIVE
$Bil.

3.5

+
II

3.0

TENDERS

NOTES AND BONDS&

IN TREASURY

$Bil.
7 Year

3.5

5 Year
2

&4Year

3.0

3, 10 8 30 Year

2.5

2.5

2.0

2.0
h

1.5

1.5

th

1.0

1.0

h

0

A M

J J

A

S

0

N

D

J F

M

A M

1988
+Excludes noncompetitive
Department of the Treasury
Office of Market Finance

J J
1989

A

S

0

N

D

J F

M

A M

J J

0

1990

tenders from foreign add-ons.
July 31, 1990-3

NONCOMPETITIYE
$8il.

3.5

+
II

3.0

TENDERS

IN

TREASURY NOTES AND BONDS&
$8il.

7 Year

3.5

5 Year
2

&4Year
3.0

3, 10 & 30 Year

2.5

2.5

2.0

2.0

1.5

1.5

re

1.0

0

1.0

'v

A M

J J

A

S

0

N

D

J F

M

A M

1988
+Excludes noncompetitive
Department of the Treasury
Office of Market Finance

J J
1989

A

S

0

N

D

J F

M

A M

J J

0

1990

tenders from foreign add-ons.
July 31, 1990-3

NET STRIPS AS A PERCENT OF PRIVATELY HELD

STRIPPABLE SECURITIES

$Bil.

Percent

Form

Held in Stripped
(Left Scale)

(Right Scale)

Year
~30
~20 Year
5%10 Year

100

90

~30
Year
~ 20

70

Year
~ aai10 Year

60

80
70

50

60
~

~
~ aaa4 ~ 0

tr'

0+,

,

+++ ~ ooo ~ 0 ~

l

~a

50

40
~a ~ a'ja'""'

~ agama

~ aann

40

~ oooo ~ a000 F 00

30

30
20

20

10

10
~

0

J

aa'aaaa

a aaaaa ~ aaa ~ a aaaaa
A

S

0

N

D

J F

M

1988

A

M

~ aaaaa

J J
1989

~ aaaa

A

S

aaaaa aa aaaaaaaa ~ a aaaaaa

0

N

D

J F

M

A

1990

M

J

+ Through
Department of the Treasury
Office of Market Finance

July 20, 1990
Note: Reconstitution began May 1, 1987
July 31, 1990-6

NET STRIPS AS A PERCENT QF PRIVATELY HELD

STRIPPABLE SECURITIES

$Bil.

Held in Stripped

Form

Percent

(Left Scale)

100

(Right Scale)

~30
Year
~ oo20

EZ30

Year
Year
RSR10 Year

~20

90

70

Year
~ ssi10 Year

80

60

70

50

60

~ oooo ~ o

~r

~,+e+i+ososooo""lloo
~

::::. .1. .. .. .

50

~o
~

40
o ~ oo ~"""
~ oooooo

40

~ oooo' ~ oooo oooo' ~ oo

30

30

20

20

10

hga

10
~

0

J

SS""
SSSSS~ S SSSSSSSSS~ S ~ SSSSSSSSSSSSSS~ SSSS SSSS~ SSSSSSSSSSSSSSSSSSS
----

A

S

0

N

D

J F

M

1988

M

J J
1989

+ Through
Department of the Treasury
Office of Market Finance

A

A

S

0

N

D

J F

M

A

1990

M

J

July 20, 1990
Note: Reconstitution began May 1, 1987
July 31, 1990-6

TREASURY NET BORROWING FROM NONMARKETABLE
$Bil.

15

~
gg
II
~

14.0
12.5

10.7
10.6

10

9.1

ISSUES
$Bil.

Savings Bonds

15

Domestic Series

State 8 Local Series
Foreign Nonmarketabfes

6.2

10

7.1

6.5

6.0

4.6

5.6
4.9
2.9

2.9

1.7

2.3

0

0

-3.1
I

II

III

1986

IV

IV

I

1987

II

III

1988

IV

I

II

III

1989

IV

1990

e estimate
Department of the Treasury
Office of Market Finance

July 31, 1990-16

TREASURY NET BORROWING FROM NONMARKETABLE
$Bil.

15

~
gg
gg
~

14.0
12.5

10.7

10.6

10

9.1

ISSUES
$Bil.

Savings Bonds

15

Domestic Series

State

& Local

Series

Foreign Nonmarketabtes

6.2

10

7.1

6.5

6.0

4.6

5.8
4.9
2.9

2.9

1.7

2.3

0

0

-3.1
N

1986

l

ll

ill

lV

l

ll

ill

1988

1987

iv

l

ll

ill

1989

iV

1990

e estimate
Department of the Treasury
Office of Market Finance

July 31, 1990-16

$Bil

CHANGES IN STATE & LOCAL GOVERNMENT SERIES
RELATIVE TQ MUNICIPAL BOND ISSUES

$Bil

50

50

KQ New Issues

~
~

Refunding

Changes

in

SLGS

40

40

30

30

20

20

10

10

haa

0
I

II

III

1986
Department of the Treasury
Office of Market Finance

IV

I

II

III

1987

IV

I

II

III

1988

4%~&hi
IV

I

I I

I I I

1989

I

V

0
I

I I

1990
July 31, 1990-9

$BII

CHANGES IN STATE & LOCAL GOVERNMENT SERIES
RELATIVE TO MUNICIPAL BOND ISSUES

$Bil

50

50

CQ New Issues
Refunding

~
~

Changes in SLGS

40

40

30

30

20

20

10

10

0
I

II

III

1986
Department of the Treasury
Office of Market Finance

I

V

I

II

III

1987

I

V

isa
I

II

III

1988

IV

I

I I

I I I

1989

I

V

0
I

I I

1990
July 31, 1990-9

—

STATE AND LOCAL MATURITIES 1990 1992
$Bil.

$Bil.

97

8.2

7.8

6.8

4.5

4.5

6.6

::4$::.
. ',:.:,:.

::;,

ig~,

,.

4.2

«v". :.i%NB

4.1

3.4
43:,.?::f'.

0

IV

1990
Department of the Treasury
Office of Market Finance

II

III

1991

IV

III

II

IV

0

1992
July 31, 1990-17

—

STATE AND LOCAL MATURITIES 1990 1992
$Bil.

$Bil.

9.7
8.2

7.8

6.8

4.5

4.5

4.2

6.6

4.1

3.4

9 ' '.' 9
,'s

0

IV

1990
Department of the Treasury
Office of Market Finance

I

III

II

1991

IV

I

II

III

IV

0

1992
July 31, 1990-17

QUARTERLY CHANGES IN FOREIGN AND INTERNATIONAL
HOLDINGS OF PUBLIC DEBT SECURITIES
$Bii

$Bil

Nonmarketable

I

35

Marketable

30

M

25

30

s

4dd-ons
Other Transactions

25.8

25
20.1

18.3

20

35

32.9

20
16.3

14.6

15
1

0

14.4

12.9

r.8

15

10

8.3

1.6

0

0
-2.1

-10
-15

-1.6

-10
-15

-1.5
-6.6
-7.4

-20
I

II

III

IV

I

1986

II

III

1987

IV

I

II

III

1988

IV

I

II

III

1989

IV

I

II

~

20

1990

&F.R.B. purchases of marketable issues as agents for foreign and international
Department of the Treasury
Office of Market Finance

monetary authorities
&Preliminary.

which are added to the announced

amount of the issue.
July 31, 1990-15

QUARTERLY CHANGES IN FOREIGN AND INTERNATIONAL
HOLDINGS OF PUBLIC DEBT SECURITIES
$Bil

$Bil

Nonmarketable

I

35

35

32.9

Marketable
Add-ons &
Other Transactions

30

30
25.8

M

25

20.1

18.3

20

25

20
16.3

14.6

15

10

14.4

12.9

7.8

15

10

8.3

1.6

0

0
-2.1

-10

-1.6

-10
-15

-1.5

—15

-6.6
-7.4

-20
I

II

III

IV

I

1986

II

III

1987

IV

I

II

III

1988

IV

I

II

III

1989

IV

I

II

f

20

1990

&F.R.B. purchases of marketable issues as agents for foreign and international
Department of the Treasury
Office of Market Finance

monetary authorities
-'f Preliminary.

which are added to the announced

amount of the issue.
July 31, 1990-15

FOREIGN ADD-ONS IN TREASURY BILL AND NOTE AUCTIONS
$Bil

$Bil

16.3

16

~
III

14

Notes
5 years and over

12

2-4 years

16
14

12.0

12

Bills

10.0 10.0

10

9.1

10

9.0

7.7
6.8

4.5
4.0:,:,::::::
:,

3.5

3.0

0
I

II

III

1986

IV

4.7

4.1

4.2

3.9

3.1

I

II

III

1987

I

V

I

II

III

IV

1988
Quarterly

Department of the Treasury
Office of Market Finance

5.1

~1Through July

I

II

III

1989

IV

I

II

Illi

4

0

1990

Totals
27, 1990.
July 31, 1990.14

FOREIGN ADD-ONS

IN

TREASURY BILL AND NOTE AUCTIONS

$Bil

$Bil

16.3

16

~
Ill

14

Notes
5 years and over

12

2-4 years

16
14

12.0

12

Bills

10.0 10.0

10

9.1

10

9.0

7.7

6.8

4.0

4.5
..

3.5

3.0

0
I

II

III

1986

IV

4

4.1

:39

4.2

:'::::::::::::.
:::.
::::::::.

I

II

3.1

I

II

III

IV

I

1987

II

III

IV

1988
Quarterly

Department of the Treasury
Office of Market Finance

5.1

~fThrough

July

I

II

III

1989

IV

III&

0

1990

Totals
27, 1990.
July 31, 1990-14

SHORT TERIN INTEREST RATES
Quarterly

Averages

20

20

18

18

gFederat Funds

16

16
~ ~ Ih

I

~
~o

o

14

s:
~
~

~1
~1
~:
»I ~ I ~ I
~
~'
~
~ ~ oo
~ ~
~
~ ~
~

14

Prime Rate

+~

~
~

10

Through
July 25

12

~

~

~,.
~

~o

~
~

g» ~
-" »~"oo
~
~"

og

3 Month

~"'~~
~ o
the»
~
~o

10

~

~
'

~

rro

ooo

.'

~

Commercial
Paper

Treasury Bill

oooo~
~

~~

1980
Department of the Treasury
Office of Market Finance

1981

1982

1983

1984

1985

o

1986

oo ~ ooo

~ ooo ooo

1987

~ o oo

~
~

'

e
~

oo

ooo

oooo"

eo

1988

1989

1990

July 31, 1990-21

SHORT TERM INTEREST RATES
Quarterly

Averages

20

20

18

gFederat Funds

16

16
I

~ ~

II
~
~o

o

14

I

~:
~:
~;
~;
~

~ '.

14

Prime Rate

«I«II

~'

~ «I

s

~ ~ oo
~ ~
~
~o

12

12

~

~
~
~

10

Through
July 25

s

s

oo

''

,«III

og
~

3 Month

OS

~

Treasury Bill

~

ooo
~ ~
~
IIr~~

10
IIII

~

~
~ oo~

ooo~
Commercial
Paper

~+~

eo

., III,II

~~

1980
Department of the Treasury
Office of Market Finance

1981

1982

1983

1984

1985

~

o
ooooo oo ~

1986

rII,

'ooo oo o o ooo o

0

~ oso ooo' ~~

1987

1988

1989

1990

4

July 31, 1990-21

SHORT TERM INTEREST RATES
Weekly Averages
Through

week ending
July

25

Prime Rate

10

10

tt

~

~

»sass

nasi

~

t
t)' sisss

Federal Funds
~

t

t's

) ) )\s6

t
ss

aa

~ ~~ ~

te ~ sat s)s

)ss)a
)
)sass ~ ~
)a ~ s)snn) ~ ~ ) ~ ~ ss) ~
~

st

ss' ~
~

I

s»sn ~, sans) ~ ssi ~ ' ~

Commercial Paper
~ooo
~~
~
o
o
~
~
ooooooo oo~ oooooooooo
~ oooooo
~ ~
~
oo
o ooo o ooo oo
~~ ~
~
~oo~
oo
3 Month Treasury Bill

Oct

Nov

1989
Department of the Treasury
Office of Market Finance

Dec

Jan

Feb

Apr

May

Jun

'"

'»i ~
ttt,

tt t

ooo
~o

Jul

1990
July 31, 1990-5

SHORT TERM INTEREST RATES
Weekly Averages
Through

week ending
July

25

Prime Rate

10

rrr
rr

Federal Funds

rasa&ass&an
nasa& ~
r&

~

ss

rr

a& ~ &»&ss&+

rr
~eea s&a

~~
~ oo ~

Commercial
~ ~ o~

ss ~ ass&sass&'&

~

« ~ ~ sss&4&&ass ~

Paper

~ 'ooo oooooo oo
~
~oo

sass&

s' ~

"n&&a&nasa&&as

I

oooooooooooo

~

~ooo

~~

&ass& ~ '

ass&sr

rr
nr

oo ~ oooooo

~~ oooooooooo

ooo
~o

3 Month Treasury Bill
Oct

Nov

1989
Department of the Treasury
Office of Market Finance

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

1990
July 31 1990.5

LONG TERM MARKET RATES
Quarterly

Averages

16

16

15

\

14
eo ~
~ ~g
~

13

I

New Aa Corporates

a

4~

II

15

13

12

12
Through

~ ~~ 0~
~ ~
~0

July 25

+

10
~ yO

10

~0

30-Year
Municipal Bonds
Treasury

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

Department of the Treasury
Office of Market Finance

July 31, 1990-22

LONG TERM MARKET RATES
Quarterly

Averages

We

16
15
14

eo ~
~
~
~
~

13

g

15

New Aa Corporates

I

I

lI
II

12

13
12

1
Through
July 25

0
yOOOO
~ ~~ ~
~ ~ $O

10
~ yO

10

~O

30-Year
Municipal Bonds

~
~

30-Year/ 'e

&

~~

~~o~~

Treasury

1980

1981

Department of the Treasury
Office of Market Finance

1982

1983

1984

1985

1986

1987

1988

1989

1990

July 31, 1990-22

Cg

co

4

4

n

~

co

0
0

0

00
0

0

Qn

Ul

(0

~gal

0

4

e0

00

v

e

)

co

0

o

00 eee

00

~

048

0

00
~0

e

0.

~0

~ o
C
~ -I

N(o
IA

E

+T 00

&m

0

r

~
w

w

C)

00
e
0
ee 0

g

4

6

Ol.

llaga

I
Ol

j

~0

&

IK

~

Cp

e e

&
w

0
0
w
~ojO

ir
w

Sr4~~

0000

w

C9

4»
n n

ee

w

I/)

+o

o

g)

lg

07

Xl

Xl

(Q

'I'III 3l

lUBU

I.I

I', 'IC6 OI II['.1&tI6f QIU9UC6
0& h IIIUIOUl Of UI6 JL6996&

«aao

«a8«

a8S

«a83

«aa&

aae

«use

J L888flLA

j'

30.A69~$

y&nUICIba~

~ oo

BOUqe

30 A8~L

4

o

«0

«a8~

o

«a88

«a8a

«aao

e

oo

i~

oo

o

ooo
oo~ ~

~ oo

~~ o
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~
oooooo
~ oo ~

«0

Vt

~v

gnIA gP

««

J /LOOBY

P
o
~
~
~

r

~

«3

Ig

~

geM QS COLbOL9$88

I ~ram
oV

aosL~eqk yAeLsGea

ONG lEHIAI INVHKEL 8V'..FH

I

INTERMEDIATE AND LONG TERM TREASURY RATES
Weekly Averages

9.0

9.0
Treasury 10-Year
SOs-

8.5
S
S~
S~

0

(

Through week
ending July 27

/

/

i
8.5

~
~O

SO
S~
~
(S~~
S

gO

\

Treasury 30-Year
~i

~~ OO ~ +OCIOOO
~
~ ~

7.5

~ ~
~ ~O
~ ~
~ O5

Oct

Nov

ee+ e

~

4 OO

)0

)

8.0

Treasury 5-Year

~O ~

Jan

Feb

Apr

May

Jun

7.5

Department of the Treasury
Office of Market Finance
July 31, 1990-4

INTERMEDIATE AND LONG TERM TREASURY RATES
Weekly Averages

9.0

9.0
Treasury 10-Year

8.5

p%a%
l~~
I
II~~
p ~
g

Through week
ending July 27

I

8.5

IfOV4

I,'

I,

~4
~

~0

~ ~
~ 0~
~ ~
~ oc

~

gO

'

gO

e,
Treasury 30-Year

ee

1

~~ o

7.5

Oct

Department of the Treasury
Office of Market Finance

yO

)0
~ +O~~eae
~
++ e'
~ ~
~y ~

Nov

ee

$ Treasury

Jan

Feb

8.0

5-Year

Apr

May

Jun

Jul

7.5

July 31, 1990-4

MARKET YIELDS ON GOVERNMENTS
Bid Yields

WWWMWWWWWWWW

~WMMSRWW
April

8.90
8.70
8.50
8.30

/I

j

30, 1990

0/ 0

8.90
8.70

I

8.50

July 30, 1990

I

8.30

l

8.10

I

8.10
7.90

8.9

8.9

8.7

8.7

8.5

8.5

8.3

10

7.70

Department of the Treasury
Office of Market Finance

12

14

16

4
6
5
Years to Maturity

18

20

7

22

24

8

26

8.3
30

28

9

7.90
7.70

10

July 31, 1990-26

MARKET YIELDS ON GOVERNMENTS
Bid Yields

WWWMWWWWWWWW

~WMMERWWWW~~

I'

8.90

8.50

8.10

30, 1990

8.90

II

8.70

8.30

April

I

8.70

IP

8.50

July 30, 1990

I

8.30

I

I
l

7.90

8. io
8.9

8.9

8.7

8.7

8.5

8.5

8.3
10

7.70

Department of the Treasury
Office of Market Finance

D/0

12

14

16

4
5
6
Years to Maturity

18

20

7

22

24

8

26

8.3
30

28

9

7.90

7.70

10

July 31, 1990-26

PRIVATE HOLDINGS OF TREASURY MARKETABLE DEBT

BY MATURITY
$Bil.

~

COUPONS
Over 10 years
~~':.
2-10 years
gag 1-2 years
QQ 1 year 8 under
BILLS

1800

J Une 3p, 1ggp~1

":.
":.
"':.":.
"::::,

1600
1400

780.2

310.2

1200

:'::. '".
:;:::::,
:::::."'.::,
:,.

':'.";::

612.3

1000

800

260.8

600
252.2

4

200

0
1979

344.7
1980

Department of the Treasury
Office of Market Finance

1981

1982

1983

1984
1985 1986
As of December 31

1987

1988

1989

July 31, 1990-10

PRIVATE HOLDINGS OF TREASURY MARKETABLE DEBT

BY MATURITY
$Bil.

~

COUPONS
Over 10 years
~~::::.. 2-10 years
853 1-2 years
1 year &. under
BILLS

1800

J Une 3p, 1ggp~1

"

3 I 0.2

":::.
":;::::::,

',

1600

II

1400

780.2

1200

:612 3

::;::.
:::;:::,:;:.:;::;:.
:::;::;:::;:;:

~

1000

800

260.8

600
252.2
400

200

0
1979

344.7
1980

Department of the Treasury
Office of Market Finance

1981

1982

1985 1986
1984
As of December 31

1983

1987

1988

1989

July 31, 1990-10

PRIVATE HOLDINGS OF TREASURY MARKETABLE DEBT
Percent Distribution

Coupons

Over 10 years

Q 2-10 years

100%

by Maturity

Q 1-2 years

g1 year

Bills

& under

~
18

90
80
70
',

60

:::34:::,
::

50
40

15

30

14

20

10
0

19

1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 Jun '90
As of December

Department of the Treasury
Office of Market Finance

31
July 31, 1990-tt

PRIVATE HOLDINGS OF TREASURY MARKETABLE DEBT
Percent Distribution

Coupons

Over

Q

100%

10 years

2-10 years

by Maturity

Q1-2 years

g1 year

Bills

& under

~
18

90
80
70

:,:34:;::

60
50

15

40

30

14

20

10
0

19

1979 1980 1981 1982 1983 1984 1985 1986 1987 1988
As of December

Department of the Treasury
Office of Market Finance

l989 Jun '90

31
July 31, 1990-11

AVERAGE LENGTH OF THE MARKETABLE DEBT
Privately Held

Years

~June
10

1947
10 Years
5 Months

Months

74

June 30, 1990
6 Years, 1 Month

73
72
71

70

JFMAMJJASOND

December 1975
2 Years
5 Months

194547 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89
Department of the Treasury
Office of Market Finance

July 31, 1990-12

AVERAGE LENGTH OF THE MARKETABLE DEBT
Privately Held

Years

~June
10

1947
10 Years
5 Months

Months

74

June 30, 1990
6 Years, 1 Month

73
72
71

70

JFMAMJJASOND

December 1975
2 Years
5 Months

194547 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89
Department of the Treasury
Office of Market Finance

".";~

'Y
i, t

(G

jQ
i'

';

4V

MATURING
August

COUPON ISSUES

—December

1990

(In millions of dollars)

June 30, 1990
Maturing

Held by

Coupons
Total

10 3/4%
9 7/8%
9 7/8%
7 7/8%
8 5/8%
6 3/4%
8 1/2%
11 1/2%
8 1/4%

13%
9 5/8%
8%
8 7/8%
6 5/8%

9 1/8%

Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note

8/15/90 - A
8/15/90 - K
8/15/90 - L22
8/15/90 - U
8/31/90 - AE
9/30/90 - Q
9/30/90 - AF
10/15/90 - F
10/31/90 - AG
11/15/90 - B
11/15/90 - M
11/15/90 - V
11/30/90 - AH
12/31/90 - R
12/31/90 - AS

Totals

Federal Reserve
& Government
Accounts
1,324
610

2, 438
6, 987

1,134
1,132
293
1,539

9,994
9,464
7, 901
9,231
4, 831
10,070

3,762
7, 597
599
11,128
10,596
8, 194
10,770
5, 044
10,710
5, 701
7, 843
13,407
10,605
8, 393
11,007

640
786
249
2, 385
495
168
1,100

125,356

12,068

Foreign

Investors~
266
1,127

599

213

F.R. B. custody accounts for foreign official institutions;
Foreign-Targeted note.
Department of the Treasury
Office of Market Finance

Private
Investors

11,022
10,110

714
918
878
536
995
526
1,474
1,847
725

8, 225
9,907

781
1,288

113,288

14, 119

4, 915
7, 594

included

in

2, 044

Private Investors.

July 31, 199tttt

MATURING
August

COUPON ISSUES

—December

(In millions

1990

of dollars)

June 30, 1990
Held by

Coupons

Maturing

Total

10 3/4%

9 7/8%
9 7/8%
7
8
6
8
11
8

7/8%
5/8%
3/4%
1/2%
1/2%
1/4%

13%
9 5/8%

8%
8 7/8%
6 5/8%
9 1/8%

8/15/90 - A
8/15/90 - K
8/15/90 - L~2
8/15/90 - U
8/31/90 - AE
9/30/90 - Q
9/30/90 - AF
10/15/90 - F
10/31/90 - AG
11/15/90 - B
11/15/90 - M
11/15/90 - V
11/30/90 - AH
12/31/90 - R
12/31/90 - AJ

Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note
Note

Totals
M1

Private
Investors

Foreign

Investors~

3,762
7, 597
599
11,128
10,596
8, 194
10,770
5, 044
10,710
5, 701
?,843
13,407
10,605
8, 393
11,007

1,324
610

2, 438
6, 987

1,134
1,132
293
1,539
213
640
786
249
2, 385
495
168
1,100

9,994
9,464
7,901
9,231
4, 831
10,070

9,907

878
536
995
526
1,474
1,847
725
781
1,288

125,356

12,068

113,288

14, 119

266
1,127

599

F.R. B custody accounts for foreign official institutions;
Foreign-Targeted

Department of the Treasury
Office oi Market Finance

Federal Reserve
& Government
Accounts

4, 915
7, 594

11,022
10,110
8, 225

included

in

2, 044

714
918

Private Investors.

note.
July 31, 19908

TREASURY MARKETABLE MATURITIES
Privately
$Bil.
22
20

18
16
14
12
10
8
6
4
2

0
28
26
24
22
20
18
16
14
12

10
8

6
4
2

0
30
28
26

1 991

19,2

18.8

$Bil.
20
18

18 4

17.8

I

II

II
1

27.9

IIII
992

21.5

i.
10.8

1p

0

4
2

0
16
14

g::::: «4 «.6:::;.:.:12.4

il

25.4

4

i
1993

mi ~

2

0
12
10
8
6

1995

I=
II

I

=

7.7

1996

9.6

1997

III

0
14
12

9.2

10

15.8

II

15.3

I

4
2

24. 1

I
20. 1

g2

III
1998 «.

I

1999

1P.4

p

8
6

14.9

4

2

I

~

IIi

IIi

1994

IIi

=
14 5

15.4

1P.7

7. 1

6
4
2

0

7.6

7.4 5 2

19.3

12

10
8

22
20
18
16
14
12
10
8
6

23. 1

24
22
20

18
16
14
12
10
8
6

«3

4
2

20.9

19.3

18.4

14
12
10
8
6

Bills

15.7

16

1p 7

I

Held, Excluding

IIi
J

F

M

A

IIi
M

J

J

0
12
10
8
6
4
2
0
14
12
10
8
6

12.3

,p 2

2000
2.5

4

2

A

S

0

0

N

D

9.5

J F

M

A

M

J

J

A

S

0

N

D

&Securities

5g
Department of the Treasury
Office of Market Finance

issued prior to 1988 IRINew issues calendar year 1989
New issues calendar year 1988 ~Issued or announced through July 27, 1990
July 31, 19904

TREASURY MARKETABLE MATURITIES
Privately
$Bil.
22

20
18

16
14
12
10
8
6
4

2

0
28
26

10 4

4
2

0
30
28
26

1p 2

I

II

III

18.4

i.

10.9

10.8

6;:.

:..'.:..:.,

11.

.':::::. 11.4

2

0
16
14
12
10
8

1993

~

IIi

IIi
136

10.7

1994

IIi

4

J

F

M

A

M

J

J

7.7

It

II

=
18.3

1 99

9.6

199781

I

0
12
10
8
6

i)i

=
148

3i

II

I

20. 1

II'I

1998

11.0

10.8

1 999

g8

I

2

15.4

S

0

10.4

4

0
14
12
10
8
6

12.3

10.2

2000
2.5

4
2

A

15.8

4
2

7. 1

2

0
12
10
8
0
14
12
10
8
6

14.9

~

4
2

6

19.3

I

I

4
2

24. 1

6
0

7.6

7.4 6 2

24
22

20
18
16
14
12
10
8
6
4

I=

20
18
16
14
12

12.4

Ii

1995

15.7

10
8
6

iI i

25.4

18
16

22

23.1

20.9

19.3

Bills

$Bil.
20
14
12
10
8
6
4
2
0

~

II

1 992

21.5

18.1

11.3

10 7

1p 2

II

27g

24
22

20
18
16
14
12
10
8
6

10.6

20. 5

iS.4

178

10.1

I

1 991

19,2

18' 8

173

Held, Excluding

0

N

D

J F

M

A

M

J

J

A

S

0

N

D

WSecurities issued

5g
Department of the Treasury
Office of Market Finance

prior to 1988 IRINew issues calendar year 1989
New issues calendar year 1988 ~Issued or announced through July 27, 1990
July 31, 1990-1

TREASURY MARKETABLE MATURITIES
Privately
$Bik
1.6

1.3

2

0

1.7

2

0
6

3.2

2.9

4
2

2001
2002
2003

8
6
4

2005

8
6
4
2

0

~

4
2

0

4.8

2

0
2

0

3.8

2

0

1.7

2

~
1.8

0
4

3.7

2

0

~

8
6

2.3

12

1.6

3.3

2006
2007
2008
2009
2010
2011
2012

1.2

~

1.3

18.0

I

6.5
18.5

20 17
13.8

2

0
8
6

3.6

2018

4

2

g
~

0

3.8
4.2

2019

19.0

20
18
16

19.8

14

12
10

8
6

4
2

4
2

0

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12

10
8

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18
16
14
12
10
8
6
4
2

12.4

6
4
2

0
4
2

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16
14
12
10
8
6
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0
16
14
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10
8
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2015

11.8

10
8
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2020
10.0

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Department of the Treasury
Office of Market Finance

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through

July 27, 1990
July 31, 1990-2

TREASURY MARKETABLE MATURITIES
$Bil.

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2006
2007
2008
2009
2010
2011
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I"

0
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14
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~

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0

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S

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1988 M Issued or announced

issued prior to 1988

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19.8

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12

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~

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19.0

10
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18
16

6
4
2
4

13.8

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3.6

14
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6.7

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179

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July 27, 1990
July 31, 1990-2

SCHEDULE OF ISSUES To BE ANNOUNCED
AND AUCTIONED IN AUGUST 1990-'J
Monday

Tuesday

Wednesday

Thursday

Auction

Auction
10 year

Auction
30 year

3

year~2

~/

Friday

10

& CMB&2

13

14

20

21

27

28

~1

~2

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~4

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5 year
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2 year~4

~5

29

17
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16

15

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30

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Does not include weekly bills
For settlement August 15
For settlement August 30
For settlement August 31
For settlement in early September

24

31

SCHEDULE OF ISSUES To BE ANNOUNCED
AND AUCTIONED IN AUGUST
Tuesday

Monday

1990+

Wednesday

Thursday

Auction

Auction
30 year

Auction
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10 year~2

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10

& CMB&2

13

20

27

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24

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31

SCHEDULE OF ISSUES To BE ANNOUNCED
AND AUCTIONED IN SEPTEMBER 1990~
Monday

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Wednesday

Thursday

Friday

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10

17

18

12

13

19

20

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2 year
4 year

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14
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52 week
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21

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27

not include weekly bills

September 27
October 1

28

SCHEDULE QF ISSUES To BE ANNOUNCED
AND AUCTIONED
Tuesday

Monday

IN

SEPTEMBER 1990~

Wednesday

Friday

Thursday

Holiday

10

17

24

18

12

13

19

20

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2 year
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1

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21

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~
W For settlement October
M1

14
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52 week

27

28

,V

SCHEDULE OF ISSUES TO BE ANNOUNCED
AND AUCTIONED IN OCTOBER 1990~
Wednesday

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Monday

3

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7 year

10

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26

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AND AUCTIONED IN OCTOBER 1990~
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7 year

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July 31, 1990.25

f

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THE WHZTE HOUSE

Office of the Press Secretary
For Immediate

Release
STATEMENT

The

President

2p

1990

BY THE DEPUTY PRESS SECRETARY

morning

signed an Executive Order freezing

assets in the United States and overseas
the President signed an Executive Order
Zn addition,
Kuwaiti assets and property in order to prevent their
Ne call on all other states to
by the Iraqi government.
similar action.

Iraqi property

branches.
freezing
takeover
undertake

this

august

and

CvC

v

' ' IS

THE WHITE HOUSE

Office of the Press Secretary
For Immediate

Release
STATEMENT

August

2) 1990

BY THE DEPUTY PRESS SECRETARY

President this morning signed an Executive Order freezing
Iraqi property and assets in the United States and overseas
the President signed an Executive Order
Zn addition,
branches'
freezing Kuwaiti assets and property in order to prevent their
We call on all other states to
takeover by the Iraqi government.
action.
similar
undertake
The

Removal Notice
The item identified below has been removed in accordance with FRASER's policy on handling
sensitive information in digitization projects due to copyright protections.

Citation Information
Document Type: Transcript

Number of Pages Removed: 23

Author(s):
Title:

Background Briefing on Foreign Assets Control

Date:

1990-08-02

Journal:

Volume:
Page(s):
URL:

Federal Reserve Bank of St. Louis

https://fraser.stlouisfed.org

9":Xe".x

e

:.

e:".

e

7. c.

'
,

„--

c-:.

i

I

I

I

7v

)
e'g

THE WHITE HOU5E

Office of the Press Secretary
Por Zmmediate

Release

August

I,

199o

6TATEXENT SY THE DEPUTY PRE56 6ECRETARY

The United States strongly condemns the Zraqi military invasion
of Kuwait and calls for the immediate and unconditional withdrawal
of all Zraqi forces, Me have conveyed this message to the Iraqi
Ambassador ie Washington and to the Zraqi Covernment through our
we deplore this blatant use of military
Embassy in Saghdad.
aggression and violation of the U. N. Charter. Together with
Kuwait we are calling for an emergency session of the U. N.

Security Council.

o

THE WHITE HOUSE

Office oi the Press Secretary
For Immediate

Release
STATEÃENT

August

X, 1990

SY THE DEPUTY PRESS SECRETARY

The United States strongly condemns the Zraqi military invasion
of Kuwait and calls for the immediate and unconditional withdrawal
of all Iraqi forces. we have conveyed this message to the Iraqi
Ambassador ie Washington and to the Zraqi Covernment through our
we deplore this blatant use of military
Embassy in Baghdad.
violation
of the U. N. Charter. Together with
and
aggression
Kuwait we are calling for an emergency session of the U. N.

Security Council.

THE WHITE HOUSE

office of the Press Secretary
For Immediate

Release

STATEMENT

August

2) 1990

BY THE DEPUTY PRESS SECRETARY

National Security Adviser Srent Scowcroft has been chairing an
interagency task force in the Situation Room monitoring the Iraqi
i.nvasion oi Kuwait.
The President was informed oi the initial
signs of the Iraqi action at approximately 9 p. m. yesterday by
National Security Adviser Scowcroft and has been receiving
perio4ic updates since.

States is deeply concerne4 about this blatant act of
the immediate and unconditional withdrawal
oi all Iraqi forces. We do not have exact details at this time
concerning the extent of the Iraqi action, although it is clearly
extensive. We have no reports oi any harm to American citizens
is in constant contact vith our Embassy in
The State Department
Kuwait concerning the status of U. S. citizens.
At the urging oi Kuwait and the United States, the United Nations
Security Council will be meeting early this morning to consider
this matter. Zn addition, we have been informed that the Arab
League and the Organization of the Islamic Conference will be
Me are urging the entire
convening to review the situation.
this
to
outrageous act of
condemn
international community
aggression.
The United States is revieving all options in its response to
the Iraqi aggression.
The United

aggression

and demands

THE WHITE HOUSE

office of the Press Secretary
For Immediate

Release

STATEMENT

August

2, 1990

BY THE DEPUTY PRESS SECRETARY

National Security Adviser Srent Scowcroft has been chairing an
interagency task force in the Situation Room monitoring the Iraqi
invasion of Kuwait. The President was informed of the initial
signs of the Iraqi action at approximately 9 p. m. yesterday by
National Security Adviser Scowcroft and has been receiving
perio4ic updates since.

States is deeply concerned about this blatant act of
aggression and demands the immediate and unconditional withdrawal
oi all Iraqi forces. Me do not have exact details at this time
concerning the extent of the Iraqi action, although it is clearly
extensive. We have no reports of any harm to American citizens.
The State Department is in constant contact with our Embassy in
Kuwait concerning the status of U. S. citizens.
At the urging of Kuwait and the United States, the United Nations
Security Council will be meeting early this morning to consider
thi ~ matter. Zn addition, we have been informed that the Arab
League and the Organization of the Islamic Conference will be
We are urging the entire
convening to review the situation.
international community to condemn this outrageous act of
aggression.
The United States is reviewing all options in its response to
the Iraqi aggression.
The United

EXECUTIVE ORDER

BLOCKING KUWAIT

I

GOVERNMENT

PROPERTY

the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic Powers Act (50 U. S.C. 1701
et seq. ), the National Emergencies Act (50 U. S.C. 1601 et seq. ),
and 3 U. S.C. 301.
By

I,

President of the United States, find that
caused by the invasion of Kuwait by .Iraq

GEORGE BUSH,

the situation

constitutes an unusual and extraordinary threat to the national
security, foreign policy and economy of the United States and
have declared a national emergency to deal with that threat.
I hereby order blocked all property and interests in
property of the Government of Kuwait or any entity purporting to
and
be the Government of Kuwait, its agencies, instrumentalities
and
the
Central
entities
Bank
of
Kuwait
controlled
that are in
the United States, that hereafter come within the United States
or that are or hereafter come within the possession or control of
United States persons, including their overseas branches.
For purposes of this Order, the term "United States person"
means any United States citizen, permanent
resident alien,
)uridical person organized under the laws of the United States or
any person

in the United States.

The Secretary of the Treasury is authorized to employ all
powers granted to me by the International
Emergency Economic
Powers Act to carry out the provisions of this Order.

This Order

to the Congress

THE WHITE HOUSEL'

August

2, 1990

is effective

and published

and shall be transmitted
in the Federal Register.

immediately

EXECUTIVE ORDER

BLOCKING KUWAIT

I

GOVERNMENT

PROPERTY

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic Powers Act (50 U. S.C. 1701
et seq. ), the National Emergencies Act (50 U. S.C. 1601 et seq. ),

and 3 U. S.C.

301.

I, GEORGE BUSH, President of the United States, find that
caused by the invasion of Kuwait by .Iraq
situation
the
constitutes an unusual and extraordinary threat to the national
security, foreign policy and economy of the United States and
have declared a national emergency to deal with that threat.
I hereby order blocked all property and interests in
property of the Government of Kuwait or any entity purporting to
and
be the Government of Kuwait, its agencies, instrumentalities
controlled entities and the Central Bank of Kuwait that are in
the United States, that hereafter come within the United States
or that are or hereafter come within the possession or control of
United States persons, including their overseas branches.
For purposes of this Order, the term "United States person"
resident alien,
means any United States citizen, permanent
under
the
laws
organized
of
the United States or
)uridical person
any person

in the United States.

Secretary of the Treasury is authorized to employ all
to me by the International Emergency Economic
Powers Act to carry out the provisions of this Order.
The

powers granted

This Order

to the Congress

THE WHITE HOUSEL'

August

2, 1990

is effective

and published

and shall be transmitted
in the Federal Register.

immediately

EXECUTIVE ORDER

IRAQI GOVERNMENT PROPERTY
PROHIBITING TRANSACTIONS WITH IRAQ

BLOCKING
AND

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic PowerS -Act (50 U. S.C. 1701
et seq ), the National Emergencies Act (SP U. S.C. 1601 et seq. ),
and section 301 of title 3 of the United States Code.

I,

President of the United States of America,
find that the policies and actions of the Government of Iraq
constitute an unusual and extraordinary threat to the national
security and foreign policy of the United States and hereby
declare a national emergency to deal with that threat. .
GEORGE BUSH,

I hereby order:

1. All property and interests in property of
of:raq, its agencies, instrumentalities and

Section
Government

the-;

entities and the Central Bank of Iraq that are in the
States, that hereafter come within the United States or
that are or hereafter come within the possession or control of
United States persons, including their overseas branches, are
controlled

United

hereby blocked.

Section 2. The following are prohibited, except to the
extent provided in regulations which may hereafter be issued

pursuant

to this Order:

(a) The import into the United States of any goods or
services of Iraqi origin, other than publications and other
informational materials;
(b) The export to Iraq of any goods, technology (including
technical data or other information controlled for export
Act (50 U. S.C.
pursuant to Section 5 of the Export Administration
App. 2404)) or services from the United States, except
publications and other informational materials, and donations of
articles intended to relieve human suffering, such as food,
clothing, medicine and medical supplies intended strictly for

medical purposes;

(c) Any transaction by a United States person relating to
transportation to or from Iraq; the provision of transportation
to or from the United States by any Iraqi person or any vessel or
aircraft of Iraqi registration; or the sale in the United States
by any person holding authority under the Federal Aviation Act of
1958, as amended (49 U. S.C. 1514), of any transportation by air
which includes any stop in Iraq;

EXECUTIVE ORDER

BLOCKING
AND

IRA(}I

PROHIBITING

GOVERNMENT

TRANSACTIONS

PROPERTY
WITH IRAQ

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic Powers-Act (50 U. S.C. 1701
et seq. ), the National Emergencies Act (5(7 U. S.C. 1601 et seq. ),
and section 301 of title 3 of the United States Code.

I, GEORGE BUSH, President of the United States of America,
find that the policies and actions of the Government of Iraq
constitute an unusual and extraordinazy threat to the national
security and foreign policy of the United States and hereby
declare a national emergency to deal with that threat. .
I hereby order:

1. All property and intezests in property of
of:raq, its agencies, instzumentalities and

Section
Goveznment

the:-

controlled entities and the Central Bank of Iraq that aze in the
United States, that hereafter come within the United States or
that are or hereafter come within the possession or control of
United States persons, including their overseas branches, are
hereby blocked.
Section 2. The following are prohibited, except to the
extent provided in regulations which may hereafter be issued

pursuant

to this Order:

(a) The import into the United States of any goods or
services of Iraqi origin, other than publications and other
informational materials;
(b) The export to Iraq of any goods, technology (including
technical data or other information controlled for export
Act, (50 U. S. C.
pursuant to Section 5 of the Export Administration
United
States,
from
the
services
except
App. 2404) ) or
publications and other informational materials, and donations of
articles intended to relieve human suffering, such as food,
clothing, medicine and medical supplies intended strictly for

medical purposes;

(c) Any transaction by a United States person relating to
transportation to or from Iraq; the provision of transportation
to or from the United States by any Iraqi person or any vessel or
aircraft of Iraqi registration; or the sale in the United States
by any person holding authority under the Federal Aviation Act of
1958, as amended (49 U. S.C. 1514), of any transportation by air
which includes any stop in Iraq;

(d)

The purchase

by any United

export from Iraq to any country;

(e)

contract

States person of goods for

The performance by any United
fa support of an industrial or

governmental

project in Iraq;

States person of

other commercial

any

or

(f) The grant or extension of credits or loans by any
United States person to the Government of Iraq, its

entities;
(g) Any transaction by a United States. person relating to
travel by any United States citizen or permanent resident alien
to Iraq, or to activities by any such person within Iraq, after
the date of this Order, other than transactions necessary to
effect such person's departure from Iraq, or travel for
instrumentalities

journalistic

capacity

and

activity

controlled

by persons

by a newsgathering

regularly employe5 in such
organization; and

transaction

by any Uaited States person which
or has the purpose of evading or avoiding,
of the prohibitions set forth in this Order.

(h)

Any

evades or avoids,

any

For purposes of this Order, the term "United States person"
any United States citizen, permanent resident alien,
juridical person organized under the laws of the United States,
or any person in the United States.

means

Section 3. This Order is effective immediately.
Section 4.

Secretary of the Treasury, in consultation
of State, is hereby authorized to take such
actions, including the promulgation of rules and regulations, as
of this Order. Such
may be necessary to carry out the purposes
actions may include prohibiting or regulating payments or
transfers of any property or any transactions involving the
transfer of anything of economic value by any United States
and
person to the Government of Iraq, its instrumentalities
controlled entities, or to any Iraqi national or entity owned or
controlled, directly or indirectly, by Iraq or Iraqi nationals.
The Secretary may redelegate any of these functions to other
officers and agencies of the Federal government. All agencies of
the United States government are directed to take all appropriate
measures within their authority to carry out the provisions of
this Order, including the suspension or termination of licenses
or other authorizations in effect as of the date of this Order.
The

with the Secretary

This Order shall be transmitted
published in the Federal Register.

THE WHITE HOUSE,

August

2, 1990

to the Congress

and

(d) The purchase by any United
export from Iraq to any country;

States person of goods for

(e) The performance by any United States person of any
contract fa support of an industrial or other commercial or
governmental
project in Iraq;
(f) The grant or extension of credits or loans by any
United States person to the Government of Iraq, its
instrumentalities
and controlled entities;
(g) Any transaction by: a United States person relating to
travel by any United States citizen or permanent resident alien
to Iraq, or to activities by any such person within Iraq, after
the date of this Order, other than transactions necessary to
effect such person's departure from Iraq, or travel for
journalistic activity by persons regularly employed in such
capacity by a newsgathering organization; and
(h) Any transaction by any Uaited States person which
evades or avoids, or has the purpose of evading or avoiding, any
of the prohibitions set forth in this Order.
For purposes of this Order, the term "United States person"
means any United States citizen, permanent
resident alien,
juridical person organized under the laws of the United States,

or any person in the United States.

Section 3. This Order is effective immediately.
Section 4.

Secretary of the Treasury, in consultation
of State, is hereby authorized to take such
actions, including the promulgation of rules and regulations, as
of this Order. Such
may be necessary to carry out the purposes
actions may include prohibiting or regulating payments or
transfers of any property or any transactions involving the
transfer of anything of economic value by any United States
and
person to the Government of Iraq, its instrumentalities
controlled entities, or to any Iraqi national or entity owned or
controlled, directly or indirectly, by Iraq or Iraqi nationals.
The Secretary may redelegate any of these functions to other
officers and agencies of the Federal government. All agencies of
the United States government are directed to take all appropriate
measures within their authority to carry out the provisions of
this Order, including the suspension or termination of licenses
or other authorizations in effect as of the date of this Order.
The

with the Secretary

This Order shall be transmitted
published in the Federal Register.

THE WHITE HOUSE,

August

2, 1990

to the Congress

and

EXECUTIVE ORDER

BLOCKING

KUWAIT

I

GOVERNMENT

PROP ERT Y

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic Powers Act (50 U. S.C. 1701
et seq. ), the National Emergencies Act (50 U. S.C. 1601 et seq. ),

and 3 U. S.C.

I,

301.

President of the United States, find that
the situation caused by the invasion of Kuwait by .Iraq
constitutes an unusual and extraordinary threat to the national
security, foreign policy and economy of the United States and
have declared a national emergency to deal with that threat.
GEORGE BUSH,

I hereby order blocked all property and interests in
property of the Government of Kuwait or any entity purporting to
and
be the Government of Kuwait, its agencies, instrumentalities
controlled entities and the Central Bank of Kuwait that are in
the United States, that hereafter come within the United States
or that are or hereafter come within the possession or control of
United States persons, including their overseas branches.
For purposes of this Order, the term "United States person"
resident alien,
means any United States citizen, permanent
)uridical person organized under the laws of the United States or
any person

in the United States.

Secretary of the Treasury is authorized to employ all
Emergency Economic
powers granted to me by the International
Powers Act to carry out the provisions of this Order.
The

This Order is effective immediately and shall be transmitted
to the Congress and published in the Federal Register.

THE WHITE HOUSEL'

August

2, 1990

EXECUTIVE ORDER

BLOCK I NG KUWA I T I GOVERNMENT

PROP ERT Y

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic Powers Act (50 U. S.C. 1701
et seq. ), the National Emergencies Act (50 U. S.C. 1601 et seq. ),

and 3 U. S.C.

I,

301.

President of the United States, find that
caused by the invasion of Kuwait by, Iraq
constitutes an unusual and extraordinary threat to the national
security, foreign policy and economy of the United States and
have declared a national emergency to deal with that threat.
GEORGE BUSH,

the situation

I hereby order blocked all property and interests in
property of the Government of Kuwait or any entity purporting to
and
be the Government of Kuwait, its agencies, instrumentalities
controlled entities and the Central Bank of Kuwait that are in
the United States, that hereafter come within the United States
or that are or hereafter come within the possession or control of
United States persons, including their overseas branches.
For purposes of this Order, the term "United States person"
means any United States citizen, permanent
resident alien,
)uridical person organized under the laws of the United States or
any person

in the United States.

The Secretary of the Treasury is authorized to employ all
powers granted to me by the International
Emergency Economic
Powers Act to carry out the provisions of this Order.

This Order

to the Congress

THE WHITE HOUSEL'

August

2, 1990

is effective

and published

and shall be transmitted
in the Federal Register.

immediately

EXECUTIVE ORDER

IRAQI GOVERNMENT PROPERTY
PROHIBITING TRANSACTIONS WITH IRAQ

BLOCKING
AND

By the authority vested in me as President by the
Constitution and laws of the United States of Amezica, including
the International Emergency Economic Powers-Act (50 U. S.C. 1701
et seq. ), the National Emergencies Act (5P U. S.C 1601 et seq. ),
and section 301 of title 3 of the United States Code.
~

I, GEORGE BUSH, President of the United States of America,
find that the policies and actions of the Government of Iraq
constitute an unusual and extraordinary threat to the national
security and foreign policy of thy United States and hereby
declare a national emergency to deal with that threat. .
I hereby order:
Section 1. All property and interests in property of the:Government of :raq, its agencies, instrumentalities
and
controlled entities and the Central Bank of Iraq that are in the
United States, that hereafter come within the United States or
that aze or hereaftez come within the possession or control of
United States persons, including their overseas branches, are
hezeby blocked.

Section 2. The following are prohibited, except to the
extent provided in regulations which may hereafter be issued

to this Order:
(a) The import into the United States of any goods or
services of Iraqi origin, other than publications and other
informational materials;
(b) The export to Iraq of any goods, technology (including
technical data or other information controlled for export
Act (50 U. S.C.
pursuant to Section 5 of the Export Administration
App. 2404)) or services from the United States, except
publications and other informational materials, and donations of
articles intended to relieve human suffering, such as food,
clothing, medicine and medical supplies intended strictly for
pursuant

medical purposes;

(c) Any transaction by a United States person relating to
transportation to or from Iraq; the provision of transportation
to or from the United States by any Iraqi person or any vessel or
aircraft of Iraqi registration; or the sale in the United States
by any person holding authority under the Federal Aviation Act of
1958, as amended (49 U. S.C. 1514), of any transportation by air
which includes any stop in Iraq;

EXECUTIVE ORDER

IRAQI GOVERNMENT PROPERTY
PROHIBITING TRANSACTIONS WITH IRAQ

BLOCKING
AND

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the Inteznational Emergency Economic Powers-Act (50 U. S.C. 1701
et seq. ), the National Emezgencies Act (5(7 U. S.C. 1601 et seq-),
and section 301 of title 3 of the United States Code.

I, GEORGE BUSH, President of the United States of America,
find that the policies and actions of the Government, of Iraq
constitute an unusual and extraordinazy threat to the national
security and foreign policy of thy United States and hereby
declare a national emergency to deal with that threat. .
I hereby order:
Section 1. All property and interests in property of the:of raq, its agencies, instrumentalities
and
controlled entities and the Central Bank of Izaq that are in the
United States, that hereafter come within the United States or
that are or hereafter come within the possession or control of
United States persons, including their overseas branches, are
hereby blocked.
Government

Section 2. The following
extent provided in regulations

pursuant

to this Orde~:

except to the
hereafter be issued

are prohibited,

which may

into the United States of any goods or
services of Iraqi origin, other than publications and other
informational materials;
(a)

The import

export to Iraq of any goods, technology (including
technical data or other information controlled for export
pursuant to Section 5 of the Export Administration
Act (50 U. S.C.
or
services
from
2404))
the
United
States,
except
App.
publications and other informational materials, and donations of
articles intended to relieve human suffering, such as food,
clothing, medicine and medical supplies intended strictly foz
(b)

The

medical purposes;

(c) Any transaction by a United States person relating to
transportation to or from Iraq; the provision of transport, ation
to or from the United States by any Iraqi person or any vessel or
aircraft of Iraqi registration; or the sale in the United States
by any person holding authority under the Federal Aviation Act of
1958, as amended (49 U. S.C. 1514), of any transportation by air
which includes any stop in Iraq;

(d) The purchase by any United
export from Iraq to any country;

States person of goods

(e) The performance by any United States person of any
contract fn support of an industrial or other commercial or
governmental
project in Iraq;
(f) The grant or extension of credits or loans by any
United States person to the Government of Iraq, its
instrumentalities
and controlled entities;
(g) Any transaction by- a United States. person relating to
travel by any United States citizen or permanent resident alien
to Iraq, or to activities by any such person within Iraq, after
the date of this Order, other than transactions necessary to
effect such person's departure from Iraq, or travel for
journalistic activity by persons regularly employe5 in such
capacity by a newsgathering organization; and
(h) Any transaction by any Uaited States person which
evades or avoids, or has the purpose of evading or avoiding, any
of the prohibitions set forth in this Order.
For purposes of this Order, the term "United States person"
means any United States citizen, permanent
resident alien,
juridical person organized under the laws of the United States,

or any person in the United States.

Section 3. This Order is effective immediately.
Section 4.

Secretary of the Treasury, in consultation
of State, is hereby authorized to take such
actions, including the promulgation of rules and regulations, as
of this Order. Such
may be necessary to carry out the purposes
actions may include prohibiting or regulating payments or
transfers of any property or any transactions involving the
transfer of anything of economic value by any United States
and
person to the Government of Iraq, its instrumentalities
controlled entities, or to any Iraqi national or entity owned or
controlled, directly or indirectly, by Iraq or Iraqi nationals.
The Secretary may redelegate any of these functions to other
officers and agencies of the Federal government. All agencies of
the United States government are directed to take all appropriate
measures within their authority to carry out the provisions of
this Order, including the suspension or termination of licenses
or other authorizations in effect as of the date of this Order.
The

with the Secretary

This Order shall be transmitted
published in the Federal Register.

THE WHITE HOUSE,

August

2, 1990

to the Congress

and

(d)

The purchase

by any United

States person of goods for

export from Iraq to any country;
(e) The performance by any United States person of any
contract in support of an industrial or other commercial or
governmental
project in Iraq;

(f) The grant or extension of credits or loans
States person to the Government of Iraq, its
instrumentalities
and controlled entities;

United

by any

(g) Any transaction by- a United States person relating to
travel by any United States citizen or permanent resident alien
to Iraq, or to activities by any such person within Iraq, after
the date of this Order, other than transactions necessary to
effect such person's departure from Iraq, or travel for
journalistic activity by persons regularly employe6 in such
capacity by a newsgathering organization; and
(h) Any transaction by any Uaited States person which
evades or avoids, or has the purpose of evading or avoiding, any
of the prohibitions set forth in this Order.
For purposes of this Order, the term "United States person"
means any United States citizen, permanent
resident alien,
juridical person organized under the laws of the United States,

or any person in the United States.

Section 3. This Order is effective immediately.
Section 4. The Secretary of the Treasury, in consultation
with the Secretary of State, is hereby authorized to take such
actions, including the promulgation of rules and regulations, as
of this Order. Such
may be necessary to carry out the purposes
actions may include prohibiting or regulating payments or
transfers of any property or any transactions involving the
transfer of anything of economic value by any United States
and
person to the Government of Iraq, its instrumentalities
controlled entities, or to any Iraqi national or entity owned or
cont. rolled, directly or indirectly, by Iraq or Iraqi nationals.
The Secretary may redelegate any of these functions to other
officers and agencies of the Federal government. All agencies of
the United States government are directed to take all appropriate
measures within their authority to carry out the provisions of
this Order, including the suspension or termination of licenses
or other authorizations in effect as of the date of this Order.
This Order shall be transmitted to the Congress and
published in the Federal Register.

THE WHITE HOUSE,

August

2, 1990

ipakment of the Treasury
RELEASE

FOR IMMEDIATE

August

'-I 'waklsln'hthn,
,

2, 1990

p.c. ~ Telephone 666-204

TI)„T, CONTACT:

Office of Financing
202/376-4350

RESULTS OF TREASURY'S AUCTION
OF 44-DAY CASH MANAGEMENT BILLS

Tenders for $4, 030 million of 44-day Treasury bills to
be issued on August 7, 1990, and to mature September 20, 1990,
were accepted at the Federal Reserve Banks today.
The details

are as follows:

RANGE

Discount
Rate

7. 59%
7 6 0~o
Average
7. 60%
Tenders at the

BIDS

OF ACCEPTED COMPETITIVE

Rate
on-Issue Yield)

Investment

(E ivalent

Low

High

high

Cou

7. 77~o
7. 78%
7. 78~o
discount rate were allotted

Price

99. 072
99. 071
99. 071
86%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)

Location
Boston
New

York

Philadelphia
Cleveland

Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas
San Francisco
TOTALS

NB-906

Acce ted

Received
$

25, 690, 000

$

4, 007, 100

1, 000

1, 000

1.525, 000

21, 500

10, 000

1, 150, 000
$28, 376, 000

$4, 029, 600

epartlnent of the Treasury
FOR IMMEDIATE

August

1

I

"I wakhlnatdn, a.c. ~

RELEASE

,

2, 1990

„T, CONTACT:

Telephone Iae-I041

Office of Financing
202/376-4350

RESULTS OF TREASURY'S AUCTION
OF 44-DAY CASH MANAGEMENT BILLS

Tenders for $4, 030 million of 44-day Treasury bills to
be issued on August 7, 1990, and to mature September 20, 1990,
were accepted at the Federal Reserve Banks today.
The details

are as follows:

RANGE

Discount
Rate

7. 59%
High
7. 60%
Average
7. 60%
Tenders at the

BIDS

OF ACCEPTED COMPETITIVE

Rate
on-Issue Yield)

Investment

(E

Low

high

ivalent

Cou

7. 77%
7. 78~a
7. 78~a
discount rate were allotted

Price

99. 072
99. 071
99. 071
86%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)

Location
Boston
New

York

Philadelphia

Acce ted

Received
$

25, 690, 000

$

4, 007, 100

1, 000

1, 000

Chicago
St. Louis
Minneapolis
Kansas City

1.525, 000

21, 500

San Francisco

1, 150, 000

Cleveland
Richmond

Atlanta

Dallas

TOTALS

NB-906

10, 000

$28, 376, 000

$4, 029, 600

Pl- i

)epariment of the Treasury
For Release
Expected at

August

on

U

9:30

Deliver

Washlnston,

~

n. C.

~

Telephone %66-2041

3, 1990

STATEMENT
THOMAS

OF

D. TERRY

BENEFITS TAX COUNSEL
OF THE TREASURY
BEFORE THE
PRIVATE RETIREMENT PLANS AND OVERSIGHT OF THE
DEPARTMENT

SUBCOMMITTEE

ON

INTERNAL REVENUE SERVICE
COMMITTEE ON FINANCE
UNITED STATES SENATE

Mr. Chairman

and Members

of the Subcommittee:

I am pleased to be here today to present the views of the
Administration
on S. 2901, the Employee Benefits Simplification
Act and on S. 2902, the Church Retirement Benefits Simplification
Act.

At the outset, I must note that in the current budgetary
environment,
simplification proposals are constrained by the
realties of the Federal budget. We believe, however, that
simplification of the employee benefit provisions of the Internal
Revenue Code is needed
and that significant
simplification is
We commend
the Chairman
possible within budgetary constraints.
Chandler for making a promising beginning by
and Representative
the introduction of S. 2901 and H. R. 5362, respectively.

—

anticipate that S. 2901 in its current form could lose
significant revenue, although we have not completed a comprehensive revenue estimate of its provisions.
Accordingly, the
We

cannot support the bill in its current form. Some
Administration
provisions of the bill will both achieve desirable simplification
It should, therefore, be
of the law and raise revenue, however.
package of simplifying
possible to fashion a revenue-neutral
to work with the Subcommittee to
We will be pleased
provisions.
achieve meaningful and affordable simplification.
Revenue Code provisions relating to employee
have become increasingly
complex in recent years.
This
wide
both
the
reflects
variety
of
complexity
plans and their
Given this environment,
increasing sophistication.
the tax laws
relating to employee benefits in general, and the tax qualificaThe

benefits

Internal

epartment of the TreasuFV

For Release U on Deliver
Expected at 9:30
August 3, 1990

SUBCOMMITTEE

Mr. Chairman

~ Washington,

D.c. ~ Telephone $66-204

STATEMENT OF
THOMAS D. TERRY
BENEFITS TAX COUNSEL
DEPARTMENT OF THE TREASURY
BEFORE THE
ON PRIVATE RETIREMENT PLANS AND OVERSIGHT
INTERNAL REVENUE SERVICE
COMMITTEE ON FINANCE
UNITED STATES SENATE

and Members

OF THE

of the Subcommittee:

pleased to be here today to present the views of the
Administration
on S. 2901, the Employee Benefits Simplification
Act and on S. 2902, the Church Retirement Benefits Simplification

I

am

Act.

At the outset, I must note that in the current budgetary
simplification proposals are constrained by the
environment,
realties of the Federal budget. We believe, however, that
simplification of the employee benefit provisions of the Internal
is
and that significant simplification
Revenue Code is needed
the Chairman
We commend
possible within budgetary constraints.
Chandler for making a promising beginning by
and Representative
the introduction of S. 2901 and H. R. 5362, respectively.

—

that S. 2901 in its current form could lose
We anticipate
significant revenue, although we have not completed a compreAccordingly, the
hensive revenue estimate of its provisions.
bill
in
its
current form. Some
cannot support the
Administration
provisions of the bill will both achieve desirable simplification
It should, therefore, be
of the law and raise revenue, however.
revenue-neutral
of simplifying
fashion
a
package
possible to
to work with the Subcommittee to
We will be pleased
provisions.
achieve meaningful and affordable simplification.
relating to employee
The Internal Revenue Code provisions
benefits have become increasingly complex in recent years. This
complexity reflects both the wide variety of plans and their
Given this environment,
the tax laws
increasing sophistication.
in
general, and the tax qualificarelating to employee benefits

tion requirements of section 401 of the Internal Revenue Code in
particular, will never be "simple. " But they clearly can be
simpler than they are now; many provisions of existing law are
such unneeded
more complex than they need be. Eliminating
the tax
and
the
taxpayer
complexity will benefit both
administrator and offers the prospect of improved compliance.
The remainder
of my written statement consists of our
substantive comments on the provisions of S. 2901 and a brief
discussion of S. 2902.
"Employee

Title I

— Nondiscrimination

Section 101. Definition
Current

S.2901

Benefits Simplification

Act"

Provisions

of

Hi

hl

Com

ensated

Em

lo ees

Law

The Internal Revenue Code (the "Code" ) defines the term
"highly compensated employee" to include any employee who during
the current or preceding year (1) was a 5-percent owner, (2)
earned over $75, 000 (indexed) in compensation,
(3) earned over
$50, 000 (indexed) in compensation and was in the top 20 percent
of the employer's workforce by compensation, or (4) was an officer earning compensation over $45, 000 (indexed) or was the
highest paid officer, if no officer earned more than the stated
amount.
For purposes of defining highly compensated employees,
the term "compensation" generally has the same meaning as for
purposes of the limits on contributions and benefits under
qualified plans (section 415), except that salary reduction
amounts are taken into account.
Current law permits certain
employers to treat, on an elective basis, all employees earning
over $50, 000 (indexed) as highly compensated employees regardless
of whether they are in the top 20 percent of the employer's
workforce by compensation.
In addition, certain family aggregation rules apply in the case of 5-percent owners and other
highly compensated employees who are among the top 10 employees
by compensation.

Pro osal

proposal would redefine the term highly compensated
to include only 5-percent owners and employees who earn
over $50, 000 (indexed) in compensation.
If an employer had no
highly compensated employees under this definition, then the one
employee with the highest compensation would be treated as highly
compensated (the "one-employee rule" ). The one-employee rule
would not apply, however, for purposes of sections 401(k) and (m)
The

employee

tion requirements of section 401 of" the Internal Revenue Code in
But they clearly can be
particular, will never be "simple.
of existing law are
provisions
simpler than they are now; many
such unneeded
more complex than they need be. Eliminating
complexity will benefit both the taxpayer and the tax
administrator and offers the prospect of improved compliance
of my written statement
The remainder
substantive comments on the provisions of

discussion

of S. 2902.
"Employee

Title I

S.2901

Benefits Simplification

— Nondiscrimination

Section 101. Definition
Current

consists of our
S. 2901 and a brief

Act"

Provisions

of

Hi

hl

Com

ensated

Em

lo ees

Law

(the "Code" ) defines the term
"highly compensated employee" to include any employee who during
the current or preceding year (1) was a 5-percent owner, (2)
earned over $75, 000 (indexed) in compensation,
(3) earned over
$50, 000 (indexed) in compensation and was in the top 20 percent
of the employer's workforce by compensation, or (4) was an officer earning compensation over $45, 000 (indexed) or was the
highest paid officer, if no officer earned more than the stated
amount.
For purposes of defining highly compensated employees,
the term "compensation" generally has the same meaning as for
purposes of the limits on contributions and benefits under
qualified plans (section 415), except that salary reduction
Current law permits certain
amounts are taken into account.
employers to treat, on an elective basis, all employees earning
over $50, 000 (indexed) as highly compensated employees regardless
of whether they are in the top 20 percent of the employer's
In addition, certain family aggreworkforce by compensation.
gation rules apply in the case of 5-percent owners and other
highly compensated employees who are among the top 10 employees
The

Internal

Revenue

Code

by compensation.

Pro osal

proposal would redefine the term highly compensated
to include only 5-percent owners and employees who earn
over $50, 000 (indexed) in compensation.
If an employer had no
highly compensated employees under this definition, then the one
employee with the highest compensation would be treated as highly
compensated (the "one-employee rule" ). The one-employee rule
would not apply, however, for purposes of sections 401(k) and (m)
The

employee

of the Code (relating to elective deferrals, matching contributions and employee contributions).
As under current law,
5-percent ownership would be determined as of any time in the
current or preceding year. For purposes of the $50, 000 rulei
however, an employee's compensation generally would be determined
under the new uniform definition of compensation under the
proposal described below for the preceding calendar year, except
that the election to use base pay could not be made. Application
of the family aggregation rules would be limited to 5-percent
owners.

Administration
We

Position

support the proposal to simplify the definition
The elimination
of the rules
compensated employees.
officers and the top 20 percent of employees by comsimplifies current law without sacrificing important

generally

of highly
regarding
pensation

policy objectives.
An

important

adjunct

employer
employee.

is

exception contained in the proposal to
of sections 401(k) and (m).

purposes

definition, however,
always deemed to have at
Thus, we oppose the
the one-employee rule for

to this simplified

is the general rule that an
least one highly compensated

We generally
support the proposal to determine compensation
based on prior periods for purposes of applying the $50, 000 rule.
This rule would enable an employer to know at the beginning of
the year who its highly compensated employees are. We are
concerned, however, that a rule looking only at prior period
compensation will result in unintended gaps in the highly
compensated group, primarily in the case of new hires and
Accordingly, the
employees with substantial pay increases.
proposal should be modified to address these gaps.

oppose the use of the proposal's new uniform definition of
compensation under section 414(s) for purposes of determining an
As a general propoemployer's highly compensated employees.
sition, we believe the definition of compensation for this
purpose should be defined as closely as possible to total taxable
In particular, we
compensation plus salary reduction amounts.
believe the proposal should require, and not merely permit, the
add-back of salary reduction amounts, as provided under current
It is inappropriate for the determination of an employer's
law.
highly compensated employees to be influenced by individual emWe

ployee decisions

to make salary reduction contributions or, for
that matter, by the employer's own decision whether to offer
salary reduction arrangements of one type or another to its

employees.

-3of the Code (relating to elective deferrals, matching contributions and employee contributions).
As under current law,
5-percent ownership would be determined as of any time in the
current or preceding year. For purposes of the $50, 000 rule,
however, an employee's compensation generally would be determined
under the new uniform definition of compensation under the
proposal described below for the preceding calendar year, except
that the election to use base pay could not be made. Application
of the family aggregation rules would be limited to 5-percent
owners.

Administration

Position

We generally
support the proposal to simplify the definition
of highly compensated employees.
of the rules
The elimination
regarding officers and the top 20 percent of employees by compensation simplifies current law without sacrificing important
policy objectives.

An

important

definition, however,
employer is always deemed to have at
Thus, we oppose the
employee.
in the proposal to the one-employee rule for

adjunct

to this simplified

is the general rule that an
least one highly compensated

exception contained
purposes of sections 401(k) and (m).

We generally
support the proposal to determine compensation
based on prior periods for purposes of applying the $50, 000 rule.
This rule would enable an employer to know at the beginning of
the year who its highly compensated employees are. We are
concerned, however, that a rule looking only at prior period
compensation will result in unintended gaps in the highly
compensated group, primarily in the case of new hires and
Accordingly, the
employees with substantial pay increases.
proposal should be modified to address these gaps.

new uniform definition
We oppose the use of the proposal's
of
compensation under section 414(s) for purposes of determining an
As a general propoemployer's highly compensated employees.
definition
of
compensation for this
sition, we believe the
purpose should be defined as closely as possible to total taxable
In particular, we
compensation plus salary reduction amounts.
and
not
should
believe the proposal
require,
merely permit, the
add-back of salary reduction amounts, as provided under current
It is inappropriate for the determination of an employer's
law.
emcompensated
employees to be influenced by individual
highly
reduction
decisions
make
contributions
to
salary
or, for
ployee
that matter, by the employer's own decision whether to offer
salary reduction arrangements of one type or another to its
employees.

Section 102. Definition
Current

of

Com

ensation

Law

Current law contains several definitions of compensation for
purposes of applying the employee benefit provisions of the Code.
One definition
applies for purposes of determining the limits on
contributions and benefits under qualified plans; a second
definition applies for purposes of determining whether employees
are highly compensated; a third definition applies generally for
rules to qualified
purposes of applying the nondiscrimination
retirement arrangements.

basic definition of compensation under current law is
and benefits under
used to determine the limits on contributions
qualified plans (section 415). Compensation for this purpose is
defined to conform as closely as possible to total taxable income
received from the employer.
Thus, salary reduction amounts excluded from an employee's gross income are not taken into account
Recently issued
in determining compensation for this purpose.
temporary and proposed Treasury regulations provide employers
with two alternative safe harbor definitions of compensation for
purposes of section 415. These definitions are wages subject to
income tax withholding
and wages subject to social security taxes
(determined without regard to the wage base limitation).
A different
definition of compensation applies under current
which employees of an employer
law for purposes of determining
are highly compensated (section 414(q)). The definition of
compensation used for this purpose is identical to that used to
determine the limits on contributions and benefits under qualified plans (including the safe harbor alternatives), except that
salary reduction amounts are added back into an employee's
otherwise taxable compensation.
The

third definition of compensation is provided under current
for the principal purpose of applying the nondiscrimination
rules applicable to qualified retirement arrangements (section
414(s)). Like the definition of compensation used to determine
an employer's highly compensated employees, this definition
specifically incorporates by reference the definition of
compensation used to determine the limits on contributions
and
benefits under qualified plans (including the safe harbor
However, because the definition is crucial to
alternatives).
determining satisfaction of the nondiscrimination
rules with
respect to a wide variety of qualified retirement arrangements,
considerably more flexibility is provided than under either of
the other two definitions of compensation discussed above. Thus,
the current statute permits an employer to elect to include in
compensation for this purpose all salary reduction amounts under
certain enumerated provisions of the Code. The recently issued
Treasury regulations implement this portion of the statute and,
A

law

Section 102. Definition
Current

of

Com

ensation

Law

Current law contains several definitions of compensation for
purposes of applying the employee benefit provisions of the Code.
One definition
applies for purposes of determining the limits on
contributions and benefits under qualified plans; a second
definition applies for purposes of determining whether employees
are highly compensated; a third definition applies generally for
rules to qualified
purposes of applying the nondiscrimination
retirement arrangements.

basic definition of compensation under current law is
and benefits under
used to determine the limits on contributions
qualified plans (section 415). Compensation for this purpose is
defined to conform as closely as possible to total taxable income
received from the employer.
Thus, salary reduction amounts excluded from an employee's gross income are not taken into account
Recently issued
in determining compensation for this purpose.
temporary and proposed Treasury regulations provide employers
with two alternative safe harbor definitions of compensation for
purposes of section 415. These definitions are wages subject to
and wages subject to social security taxes
income tax withholding
(determined without regard to the wage base limitation).
The

different definition of compensation applies under current
which employees of an employer
law for purposes of determining
are highly compensated (section 414(q)). The definition of
compensation used for this purpose is identical to that used to
determine the limits on contributions and benefits under qualified plans (including the safe harbor alternatives), except that
A

salary reduction amounts are added back into an employee's
otherwise taxable compensation.

third definition of compensation is provided under current
for the principal purpose of applying the nondiscrimination
rules applicable to qualified retirement arrangements (section
414(s)). Like the definition of compensation used to determine
an employer's highly compensated employees, this definition
specifically incorporates by reference the definition of
and
compensation used to determine the limits on contributions
benefits under qualified plans (including the safe harbor
However, because the definition is crucial to
alternatives).
determining satisfaction of the nondiscrimination
rules with
wide
of
variety
qualified retirement arrangements,
respect to a
considerably more flexibility is provided than under either of
the other two definitions of compensation discussed above. Thus,
the current statute permits an employer to elect to include in
compensation for this purpose all salary reduction amounts under
certain enumerated provisions of the Code. The recently issued
Treasury regulations implement this portion of the statute and,
A

law

in addition,

permit employers to include salary reduction amounts
certain other provisions of the Code. The current statute
also grants the Secretary authority to prescribe alternative
definitions of compensation under section 414(s) as long as such
alternative definitions do not result in discrimination in favor
of highly compensated employees.
implement this
The regulations
authority in two ways, most significantly by permitting employers
to elect to use any other reasonable definition of compensation
subject to satisfaction of a nondiscrimination
test.
Pro osal

under

all three definitions

of compensaFor purposes of determining the limits
on contributions
and benefits under qualified plans, the proposal
would define compensation
as wages shown on the W-2 form (defined
for this purpose as wages subject to income tax withholding).
Alternatively,
an employer could elect to define compensation
solely by reference to the base pay of employees.
Under either
alternative, an employer could elect to include certain salary
reduction amounts in compensation.
Either of the foregoing
elections would have to be made on a consistent basis for all
plans, with respect to all employees, and for all purposes
(except as noted below). Neither election could be revoked
without the Commissioner's consent.
proposal would
tion under current law.
The

amend

The same definition of compensation
would apply for purposes
of determining the employer's highly compensated employees.
Two
exceptions would apply, however.
First, as mentioned earlier,
compensation for this purpose generally would be determined on
the basis of the prior year rather than the current year. And,
second, an employer could not elect to define compensation by
reference to base pay, even if such election were made for
purposes other than determining the employer's highly compensated

employees.

The same definition of compensation would apply under section
414(s) as applies for purposes of determining the limits on
contributions and benefits under qualified plans. In addition,
the proposal specifically repeals the Secretary's authority under
that section to prescribe alternative definitions of compensa-

tion.

Administration

Position

to amend the current law definitions
We oppose the proposal
We
believe
that the current definitions are
compensation.
of
more consistent than the proposal with the policies underlying
each of the affected provisions of the Code. In addition, we
believe the temporary and proposed regulations issued last Nay
under sections 414(s) and 415 of the Code are more workable than
Legislation in this area is unnecessary.
the proposal.

to include salary reduction amounts
under certain other provisions of the Code. The current statute
also grants the Secretary authority to prescribe alternative
definitions of compensation under section 414(s) as long as such
alternative definitions do not result in discrimination in favor
implement this
of highly compensated employees.
The regulations
authority in two ways, most significantly by permitting employers
to elect to use any other reasonable definition of compensation
test.
subject to satisfaction of a nondiscrimination
in addition,

permit

employers

Pro osal

of compensaThe proposal would amend all three definitions
tion under current law. For purposes of determining the limits
on contributions
and benefits under qualified plans, the proposal
would define compensation
as wages shown on the W-2 form (defined
for this purpose as wages subject to income tax withholding).
an employer could elect to define compensation
Alternatively,
Under either
solely by reference to the base pay of employees.
alternative, an employer could elect to include certain salary
Either of the foregoing
reduction amounts in compensation.
elections would have to be made on a consistent basis for all
plans, with respect to all employees, and for all purposes
(except as noted below). Neither election could be revoked
without the Commissioner's consent.
The same definition of compensation would apply for purposes
Two
of determining the employer's highly compensated employees.
First, as mentioned earlier,
exceptions would apply, however.
compensation for this purpose generally would be determined on
the basis of the prior year rather than the current year. And,
second, an employer could not elect to define compensation by
reference to base pay, even if such election were made for
purposes other than determining
employees.

the employer's

highly

compensated

definition of compensation would apply under section
414(s) as applies for purposes of determining the limits on
contributions and benefits under qualified plans. In addition,
the proposal specifically repeals the Secretary's authority under
that section to prescribe alternative definitions of compensaThe same

tion.

Administration

Position

the current law definitions
that the current definitions are
We believe
of compensation.
more consistent than the proposal with the policies underlying
each of the affected provisions of the Code. In addition, we
believe the temporary and proposed regulations issued last May
under sections 414(s) and 415 of the Code are more workable than
Legislation in this area is unnecessary.
the proposal.
We

oppose the proposal

to

amend

we oppose the election permitted
under the
reduction
amounts
in
include
salary
compensation for
proposal to
purposes of determining the limits on contributions and benefits
The election is inconsistent
with the
under qualified plans.
from
gross income not be
general policy that amounts excluded
taken into account for this purpose

zn

particular,

failure to require that salary
We also oppose the proposal's
reduction amounts be added back to an employee's otherwise
taxable compensation for purposes of determining the employer's
highly compensated employees for the reasons explained earlier in
our testimony.
In addition, we believe the reduction in the number of
options employers have under the proposal to define compensation
for purposes of section 414(s) is unwarranted.
In developing the
regulations, the IRS surveyed large numbers of employers in order
to tailor the section 414(s) definition of compensation to existing payroll and compensation practices as well as to the needs of
widely-used plan designs.
Based on the survey, the IRS found
little consistency in payroll and compensation practices.
Accordingly, we do not believe the proposal provides the
necessary flexibility to make it workable
Moreover, that
flexibility could no longer be provided through regulations as
the proposal would repeal the Secretary's authority to prescribe
alternative definitions of compensation.

Finally, we oppose the proposal's failure to impose a
statutory requirement that any definition of compensation elected
by an employer by reference to base pay must be nondiscriminatory.
Section 103. Modifications
Current

of Cost-of-Livin

Ad

ustments

Law

Cost-of-living adjustments to various dollar limitations are
currently made under adjustment procedures similar to those used
for adjusting benefits under the Social Security Act, generally
using the last calendar quarter of a year and a base period of
the last calendar quarter of 1986. Under the Social Security Act
procedures, cost-of-living adjustments to benefits are announced
after the beginning of the year in which they are effective.
Pro osal
The proposal would require the cost-of-living
adjustments to
be based on increases in the applicable index as of the close of
the calendar quarter ending September 30 of the preceding calendar year. The proposal would also require that dollar amounts,
as adjusted, be rounded to the nearest $1, 000 (or to the nearest
$100 in the case of the limitations on elective deferrals and in

In particular, we oppose the election permitted under the
proposal to include salary reduction amounts in compensation for
purposes of determining the limits on contributions and benefits
The election is inconsistent
under qualified plans.
with the
from
amounts
excluded
that
income
gross
not be
general policy
taken into account for this purpose.

failure to require that salary
we also oppose the proposal's
reduction amounts be added back to an employee's otherwise
taxable compensation for purposes of determining the employer's
highly compensated employees for the reasons explained earlier in
our testimony.
In addition, we believe the reduction in the number of
options employers have under the proposal to define compensation
for purposes of section 414(s) is unwarranted.
In developing the
regulations, the IRS surveyed large numbers of employers in order
to tailor the section 414(s) definition of compensation to existing payroll and compensation practices as well as to the needs of
widely-used plan designs.
Based on the survey, the IRS found
little consistency in payroll and compensation practices.
Accordingly, we do not believe the proposal provides the
necessary flexibility to make it workable.
Moreover, that
flexibility could no longer be provided through regulations as
the proposal would repeal the Secretary's authority to prescribe
alternative definitions of compensation.

Finally, we oppose the proposal's failure to impose a
statutory requirement that any definition of compensation elected
by an employer by reference to base pay must be nondiscriminatory.
Section 103. Modifications
Current

of Cost-of-Livin

Ad

ustments

Law

Cost-of-living adjustments to various dollar limitations are
currently made under adjustment procedures similar to those used
for adjusting benefits under the Social Security Act, generally
using the last calendar quarter of a year and a base period of
the last calendar quarter of 1986. Under the Social Security Act
procedures, cost-of-living adjustments to benefits are announced
after the beginning of the year in which they are effective.
Pro osal
would require the cost-of-living adjustments
to
increases in the applicable index as of the close of
the calendar quarter ending September 30 of the preceding calendar year. The proposal would also require that dollar amounts,
as adjusted, be rounded to the nearest $1, 000 (or to the nearest
$100 in the case of the limitations on elective deferrals and in
The

proposal

be based on

the case of the minimum and maximum compensation amounts
able to simplified employee pensions ("SEPs")).

Administration

applic-

Position

believe this provision would be simplifying and is worth
Use of an earlier calendar quarter would
further investigation.
permit cost-of-living adjustments to be announced before the
beginning of a calendar year, and the use of rounding would ease
and employee communications.
administration
We

Section 104. Modification
Current

of Additional

Partici ation

Law

Qualified plans, including both defined benefit and defined
contribution plans, are generally required to benefit the lesser
New
of 50 employees or 40 percent of the employer's workforce.
substantially
issued
in
of
this
year
May
proposed regulations
simplified the application of the minimum participation
requirements.
Pro osal
The

proposal

would

exempt

defined

contribution

plans

from the

In addition, the proposal
participation requirements.
under the minimum
thresholds
numerical
generally would reduce the
participation requirements to require a defined benefit plan to
cover only the lesser of 25 employees or 40 percent of the
employer's workforce (but in no case less than 2 employees unless
The proposal would also
the employer had only one employee).

minimum

permit

employers

had been included

Administration

to elect to have the

new rules apply as
in the Tax Reform Act of 1986.

if

they

Position

are willing to investigate with the Congress the merits of
requirements
modifying the current law minimum participation
Because
the proposal
along the lines set forth in the proposal.
would permit employers to maintain a greater number of qualified
plans with a smaller number of participants in each plan, a full
burden the
assessment is needed of the additional administrative
proposal would place on the Internal Revenue Service.
We

also question the desirability of an exemption for defined
contribution plans from the minimum participation requirements.
that exemption, the proposal draws a fundamental
By providing
defined benefit and defined contribution
between
distinction
plans when, in practice, hybrid plans such as target benefit
plans share characteristics of both types of plans. We believe
We

the case of the minimum and maximum compensation amounts
able to simplified employee pensions ("SEPs")).

Administration
We

applic-

Position

believe this provision

would

be simplifying

and

is

worth

investigation.
Use of an earlier calendar quarter would
permit cost-of-living adjustments to be announced before the
beginning of a calendar year, and the use of rounding would ease
further

administration

and employee

Section 104. Modification

Re uirements

Current

communications.

of Additional

Partici ation

Law

Qualified plans, including both defined benefit and defined
contribution plans, are generally required to benefit the lesser
of 50 employees or 40 percent of the employer's workforce.
New
proposed regulations issued in May of this year substantially
simplified the application of the minimum participation
requirements.

Pro osal

defined contribution plans from the
minimum participation
In addition, the proposal
requirements.
generally would reduce the numerical thresholds under the minimum
participation requirements to require a defined benefit plan to
cover only the lesser of 25 employees or 40 percent of the
employer's workforce (but in no case less than 2 employees unless
the employer had only one employee).
The proposal would also
permit employers to elect to have the new rules apply as if they
had been included in the Tax Reform Act of 1986
The

proposal

Administration

would

exempt

Position

We are willing
to investigate with the Congress the merits of
requirements
modifying the current law minimum participation
Because the proposal
along the lines set forth in the proposal.
would permit employers to maintain a greater number of qualified
plans with a smaller number of participants in each plan, a full
burden the
assessment is needed of the additional administrative
Revenue
Service.
on
Internal
would
the
place
proposal

the desirability of an exemption for defined
We also question
contribution plans from the minimum participation requirements.
that exemption, the proposal draws a fundamental
By providing
distinction between defined benefit and defined contribution
plans when, in practice, hybrid plans such as target benefit
plans share characteristics of both types of plans. We believe

study is needed of this issue before a major category of
plans is exempted from the minimum participation requirements

more

altogether.
We

oppose the portion

to elect

a

retroactive

of the proposal

effective date.

that permits employers

Rules for Qualified
Deferred Arran ements and Matchin Contributions

Section 105. Nondiscrimination
Current

Cash or

Law

Elective salary deferral contributions to a qualified cash or
are generally required to meet a special
arrangement
average deferral percentage ("ADP") test. To satisfy the ADP
test, the average of the deferral rates (expressed as a percentfor each highly compensated employee
age of compensation)
eligible to participate in the plan generally may not exceed the
greater of (1) 125 percent of the average of the deferral rates
of all nonhighly compensated employees eligible to participate in
the plan or (2) the lesser of (a) 200 percent of the average of
the deferral rates of all nonhighly compensated employees
eligible to participate in the plan, or (b) such average plus 2
percentage points.
If a plan does not satisfy the ADP test for a
year, excess deferrals by highly compensated employees must be
either redistributed to them or recharacterized as after-tax
contributions in order to retain the qualified status of the cash
or deferred arrangement.
The distributions
are made on the basis
of the respective portions of excess contributions attributable
to each highly compensated employee.

deferred

If

provides

a plan

permits

for employer

after-tax

contributions,
that are contingent

employee

contributions

or
on a

participant's elective deferrals or after-tax employee contributions ("matching contributions"), the amount of such
contributions generally must satisfy a special average contribution percentage ("ACP") test. The ACP test
as the ADP test described above, except that

is generally

it

the

same

applies to matching and after-tax employee contributions
rather than to elective
deferrals. Rules analogous to the distribution rules under the
ADP test must also be followed
if the ACP test is not satisfied.
Pro osal

would create certain safe harbors that would, in
either the ADP test or the ACP test, or both, to
have been satisfied with respect to elective deferrals and
matching contributions
if the plan meets certain design and
notice criteria. The ADP test would be deemed to have been
satisfied if (1) the plan either (a) provided matching
contributions with respect to all nonhighly compensated employees
equal to 100 percent of elective deferrals up to 3 percent of
The

effect,

proposal
deem

needed of this issue before a major category of
exempted from the minimum participation
requirements

study

more

is

plans

is

altogether.
we

oppose the portion

to elect

a

retroactive

of the proposal

effective date.

that permits employers

Rules for Qualified
Contributions
Deferred Arran ements and Matchin

Section 105. Nondiscrimination
Current

Cash or

Law

Elective salary deferral contributions to a qualified cash or
deferred arrangement are generally required to meet a special
average deferral percentage ("ADP") test. To satisfy the ADP
test, the average of the deferral rates (expressed as a percentfor each highly compensated employee
age of compensation)
eligible to participate in the plan generally may not exceed the
greater of (1) 125 percent of the average of the deferral rates
of all nonhighly compensated employees eligible to participate in
the plan or (2) the lesser of (a) 200 percent of the average of
the deferral rates of all nonhighly compensated employees
eligible to participate in the plan, or (b) such average plus 2
percentage points.
If a plan does not satisfy the ADP test for a
year, excess deferrals by highly compensated employees must be
either redistributed to them or recharacterized as after-tax
contributions in order to retain the qualified status of the cash
or deferred arrangement.
The distributions
are made on the basis
of the respective portions of excess contributions attributable
to each highly compensated employee.

If

a plan permits
provides for employer

after-tax

contributions,
that are contingent

employee

contributions

or
on a

participant's elective deferrals or after-tax employee contributions ("matching contributions"), the amount of such
contributions generally must satisfy a special average contribution percentage ("ACp") test. The ACp test
as the ADP test described above, except that

is generally

it

the

same

applies to matching and after-tax employee contributions
rather than to elective
deferrals. Rules analogous to the distribution rules under the
ADP test must also be followed
if the ACP test is not satisfied.
Pro osal

would create certain safe harbors that would, in
either the ADP test or the ACP test, or both, to
have been satisfied with respect to elective deferrals and
matching contributions
if the plan meets certain design and
notice criteria. The ADP test would be deemed to have been
satisfied if (1) the plan either (a) provided matching
contributions with respect to all nonhighly compensated employees
equal to 100 percent of elective deferrals up to 3 percent of
The

effect,

proposal
deem

and 50 percent of elective deferrals between
percent of compensation, or (b) provided nonelective contributions equal to at least 3 percent of compensation to all
nonhighly compensated employees eligible to participate in the
plan, and (2) provided notice within a reasonable period before
the beginning of a year to all employees eligible to participate
of their rights and obligations under the plan. Certain
alternative matching formulas would be allowed, subject to
nondiscrimination
requirements.

compensation,
5

test would be deemed to have been satisfied with
respect to matching contributions if the design and notice
criteria relating to the ADP test were met and, in addition, (1)
matching contributions were not made with respect employee
contributions or elective deferrals in excess of 6 percent of an
employee's compensation,
(2) the level of matching contributions
did not increase with the level of employee or matching contributions, and (3) the rate of matching contributions at each level
of compensation was no higher for highly compensated than
The ACP

nonhighly

compensated

employees.

Employer matching and nonelective contributions
used to meet
the safe harbor requirements would be required to be nonforfeitable and subject to restrictions on withdrawals.

proposal would also modify the standards for determining
excess deferrals and matching contributions to distribute
first in the event the ADP or ACP tests are not passed and
require any distributions to be made to highly compensated
employees on the basis of the respective amount of contributions
The

which

their behalf.
Administration
Position
on

made

oppose the proposed modifications to the nondiscrimination
under sections 401(k) and 401(m) which would eliminate
The proposals
current law testing based on actual contributions.
represent a significant change in policy, not merely a simpliWe

tests

fication.

believe they would seriously erode current policies
against discrimination in retirement plans. We believe that the
principal sources of complexity in this area are not the basic
the rules applicable to the
ADP and ACP tests but rather
distribution and recharacterization of excess deferrals and
of these
contributions.
Thus, we believe that simplification
rules--not abandonment of the fundamental policy underlying these
rules--should be the simplification objective
nondiscrimination
We

in this area.

employees to elect the
behalf,
their
existing law takes into
on
contributed
amount, to be
account the fact that higher-paid employees will normally choose
to defer a higher percentage of their income than lower-paid

In the case of plans which permit

percent of elective deferrals between 3 and
5 percent of compensation,
or (b) provided nonelective contributions equal to at least 3 percent of compensation to all
nonhighly compensated employees eligible to participate in the
plan, and (2) provided notice within a reasonable period before
the beginning of a year to all employees eligible to participate
of their rights and obligations under the plan. Certain
alternative matching formulas would be allowed, subject to
nondiscrimination
requirements.
compensation,

and 50

test would be deemed to have been satisfied with
to
if the design and notice
matching contributions
respect
criteria relating to the ADP test were met and, in addition, (1)
matching contributions were not made with respect employee
contributions or elective deferrals in excess of 6 percent of an
employee's compensation,
(2) the level of matching contributions
did not increase with the level of employee or matching contributions, and (3) the rate of matching contributions at each level
of compensation was no higher for highly compensated than
The ACP

nonhighly

compensated

employees.

used to meet
matching and nonelective contributions
nonforfeitbe
would
to
the safe harbor requirements
be required
Employer

able and subject to restrictions
The

which

first

proposal

would

excess deferrals

on withdrawals.

also modify the standards for determining
to distribute
and matching contributions

ADP or ACP tests are not passed and
to be made to highly compensated
any distributions
the respective amount of contributions
basis
of
on
the
employees
made on their behalf.

require

in the event the

Administration

Position

oppose the proposed modifications to the nondiscrimination
tests under sections 401(k) and 401(m) which would eliminate
The proposals
current law testing based on actual contributions.
not
merely
a simpliin
policy,
represent a significant change
fication. We believe they would seriously erode current policies
against discrimination in retirement plans. We believe that the
principal sources of complexity in this area are not the basic
to the
ADP and ACP tests but rather the rules applicable
We

distribution and recharacterization of excess deferrals and
of these
contributions.
Thus, we believe that simplification
fundamental
underlying
these
policy
the
of
rules--not abandonment
simplification
objective
rules--should be the
nondiscrimination
in this area.
In the case of plans which permit employees to elect the
on their behalf, existing law takes into
amount to be contributed
employees will normally choose
higher-paid
that
fact
account the
income than lower-paid
their
of
to defer a higher percentage

-10Thus, the ADP and ACP tests permit deferral percentemployees.
high-paid and low-paid employees to be separately
the
for
ages
averaged and build in a disparity in favor of the higher-paid.
zn effect, the elective deferrals on behalf of highly compensated
which lower-paid
employees are leveraged off of the contributions
employees

actually

make

to the plan.

In fact,
Cash or deferred plans are extremely popular today.
as illustrated in Table I below, IRS data indicates that an
increasingly large number of employers continue to establish and
maintain these plans even though ADP and ACP testing is required,
and even though the Tax Reform Act of 1986 substantially
tightened the statutory requirements.
TABLE
NUMBER

OF

I

401(K)

(Based on Form 5500

FORM
FORM
FORM

5500
5500-C
5500-R (ESTIMATED)

TOTAL

SOURCE:
JULY

PLANS

Filings)

1985

1986

1987

1988

6, 942
17, 499
22, 203

8, 842
17, 228
21, 859

10, 486
22, 088
21, 947

26, 341
26, 756

46, 644

47, 929

54, 521

63, 742

10, 645

INTERNAL REVENUE SERVICE
EMPLOYEE PLANS & EXEMPT ORGANIZATIONS

31, 1990

It is not at all clear what effect substituting a designbased qualification system for the ADP and ACP tests will have on
the participation of nonhighly compensated employees in cash or
deferred arrangements.
The present-law ADP and ACP tests provide
an clear incentive for employers to design a plan that is
attractive to rank-and-file employees and to make every effort to
communicate the plan to those employees, since the actual level
of participation by those employees directly affects the
permitted level of deferrals by highly compensated employees.
By
contrast, while the proposal does require notice of the plan to
be given to eligible employees, a design-based
test provides no
incentive to provide benefits in excess of the statutory minimum.
rank-and-file

~P

~Y Y

employees to participate since, once the designbased criteria have been met, any additional participation by the
nonhighly compensated generally increases the cost of a plan.

-10—
Thus, the ADP and ACP tests permit deferral percentemployees.
high-paid and low-paid employees to be separately
for
the
ages
averaged and build in a disparity in favor of the higher-paid.
In effect, the elective deferrals on behalf of highly compensated
which lower-paid
employees are leveraged off of the contributions
employees actually make to the plan.

In fact,
Cash or deferred plans are extremely popular today.
as illustrated in Table I below, IRS data indicates that an
increasingly large number of employers continue to establish and
maintain these plans even though ADP and ACP testing is required,
and even though the Tax Reform Act of 1986 substantially
tightened the statutory requirements.
TABLE
NUMBER

OF

I

401(K)

PLANS

(Based on Form 5500 Filings)

FORM
FORM
FORM

5500
5500-C
5500-R (ESTIMATED)

TOTAL

SOURCE:

JULY

1985

1986

1987

1988

6, 942
17, 499

10, 486
22, 088
21, 947

10, 645

22, 203

8, 842
17, 228
21, 859

26, 341
26, 756

46, 644

47, 929

54, 521

63, 742

INTERNAL REVENUE SERVICE
EMPLOYEE PLANS & EXEMPT ORGANIZATIONS

31, 1990

It is not at all clear what effect substituting a designbased qualification system for the ADP and ACP tests will have on
the participation of nonhighly compensated employees in cash or
deferred arrangements.
The present-law ADP and ACP tests provide
an clear incentive for employers to design a plan that is
attractive to rank-and-file employees and to make every effort to
communicate the plan to those employees, since the actual level
of participation by those employees directly affects the
permitted level of deferrals by highly compensated employees.
By
contrast, while the proposal does require notice of the plan to
be given to eligible employees, a design-based
test provides no
incentive to provide benefits in excess of the statutory minimum.
rank-and-file

~d'

~1 y

l

employees to participate since, once the designbased criteria have been met, any additional participation by the
nonhighly compensated generally increases the cost of a plan.

-11various sources of complaint about the ADP and ACP
believe that the rules for correcting excess contributions are the most significant.
Ways to simplify those rules
while retaining the present-law ADP and ACP tests should be
explored.
Of the

tests,

We

would

we

also believe that

be to base the

ADP

one way
and ACP

rules
year'
s
prior
percentages for

to simplify

tests

on the

the current

average deferral and average contribution
nonhighly compensated employees.
This approach would make the
results of the tests more predictable and would significantly
reduce the likelihood of excess contributions because an employer
would need to monitor currently only the elections of highly
compensated employees.
Indeed, excess contributions might be
avoided altogether under such an approach if each highly
compensated employee were permitted to defer no more than
the prior year's average deferral percentage for nonhighly
compensated employees plus the disparity otherwise permitted
under those tests.
This rule would be similar to the present-law
rule for elective deferrals under simplified employee pensions.

Title II

— Distributions

Section 201. Taxabilit
Present

of Beneficiar

of

Em

lo ees' Trust

Law

Distributions

retirement

from

receipt.

qualified

are generally

programs
Premature

plans and other tax-preferred

subject to income tax

upon

before
distributions, generally
age 59-1/2, may also be subject to a 10-percent additional tax.
A number
of special rules may alter the general rule if
applicable.
those

made

Rollovers

if

applicable, the additional tax on
can be avoided if the taxable portion of an
a distribution
eligible distribution is "rolled over" to another qualified plan
or Individual Retirement Account ("IRA"). Only certain distributions (generally distributions that are either "qualified
total distributions" or "partial distributions) are eligible for
As only the taxable portion of a distriburollover treatment.
rollover treatment, after-tax employee
for
tion is eligible
contributions may not be rolled over.
Current

Lum

Sum

Ca

Certain

income

tax and,

Distributions

ital

Gains and Forward Avera in

lump

sum

special rules.

are eligible to be taxed under
these rules result in a lower rate of

distributions

Generally,

-11various sources of complaint about the ADP and ACP
tests, we believe that the rules for correcting excess contributions are the most significant.
Ways to simplify those rules
while retaining the present-law ADP and ACP tests should be
explored.
Of the

also believe that one way to simplify the current rules
would be to base the ADP and ACP tests on the prior year' s
average deferral and average contribution percentages for
We

employees.

compensated

nonhighly

This approach

would

make

the

results of the tests more predictable and would significantly
reduce the likelihood of excess contributions because an employer
would need to monitor currently only the elections of highly
compensated employees.
Indeed, excess contributions might be
avoided altogether under such an approach if each highly
compensated employee were permitted to defer no more than
the prior year's average deferral percentage for nonhighly
compensated employees plus the disparity otherwise permitted
under those tests.
This rule would be similar to the present-law
rule for elective deferrals under simplified employee pensions.

Title II

— Distributions

Section 201. Taxabilit
Present

of Beneficiar

of

Em

lo ees' Trust

Law

Distributions

from

qualified

plans and other tax-preferred

are generally subject to income tax upon
distributions, generally those made before
age 59-1/2, may also be subject to a 10-percent additional tax.
A number
of special rules may alter the general rule if
applicable.
retirement

receipt.

programs
Premature

Rollovers
Current income tax and, if applicable, the additional tax on
distribution can be avoided if the taxable portion of an
eligible distribution is "rolled over" to another qualified plan
or Individual Retirement Account ("IRA"). Only certain distributions (generally distributions that are either "qualified
total distributions" or "partial distributions) are eligible for
As only the taxable portion of a distriburollover treatment.
tion is eligible for rollover treatment, after-tax employee
contributions may not be rolled over.
a

Lum

Sum

Ca

Certain

Distributions

ital
lump

special rules.

Gains and Forward Avera in
sum

are eligible to be
these rules result in a lower

distributions

Generally,

-12—
tax than would otherwise apply to a distribution, but
in an employee~s
used with respect to one distribution

may

only be

lifetime.

or beneficiary may be able to elect to use the
5-year forward averaging rules with respect to a lump sum
distribution if certain requirements are met. If a lump sum
distribution is received before 1992, the recipient may also be
able to elect to have the portion of the distribution
attributable to pre-1974 plan participation taxed at capital
gains rates.
A

participant

Participants who attained age 50 before January 1, 1986, have
three additional options which may reduce the rate of tax on a
distribution.
First, instead of using the 5-year forward
averaging rules, they may continue to use the 10-year forward
averaging rules available before the Tax Reform Act of 1986.
Second, they may use the 5-year and 10-year forward averaging
rules even if they are younger than the currently prescribed age
if all of the other
requirement when they receive a distribution,
for using those rules are met. Finally, they may
requirements
elect to have the entire portion of a lump sum distribution
attributable to pre-1974 participation taxed at a 20 percent

rate.

reciation
If a lump sum distribution includes securities of the
employer corporation,
the "net unrealized appreciation" ("NUA")
in the employer securities is generally not subject to tax until
the securities are sold, unless the recipient elects to have the
normal distribution
rules apply. When the securities are sold,
the NUA is treated as long-term capital gain. If a distribution
is not a lump sum distribution, only the NUA attributable to the
employee's own contributions may be excluded from income under
these special rules.
Net Unrealized

A

Pro osal

proposal would eliminate most of the restrictions on the
of
distributions eligible for rollover treatment, and would
types
eliminate 5-year forward averaging for lump sum distributions.
It would, however, continue to prohibit the rollover of employee
contributions.
It would also retain the current law treatment of
and
NUA,
the special capital gains and forward averaging rules
available to participants who attained age 50 before January 1,
1986.
The

Position
We believe
that the qualified plan distribution rules are
excellent candidate for simplification.
The tax treatment
of
qualified plan distributions is unnecessarily complex. The

Administration

an

-12—
tax than would otherwise apply to a distribution, but
in an employee~s
used with respect to one distribution

may

only be

lifetime.

or beneficiary may be able to elect to use the
5-year forward averaging rules with respect to a lump sum
distribution if certain requirements are met. If a lump sum
distribution is received before 1992, the recipient may also be
able to elect to have the portion of the distribution
attributable to pre-1974 plan participation taxed at capital
gains rates.
A

participant

Participants who attained age 50 before January 1, 1986, have
three additional options which may reduce the rate of tax on a
distribution.
First, instead of using the 5-year forward
averaging rules, they may continue to use the 10-year forward
averaging rules available before the Tax Reform Act of 1986.
Second, they may use the 5-year and 10-year forward averaging
rules even if they are younger than the currently prescribed age
requirement when they receive a distribution,
if all of the other
requirements
for using those rules are met. Finally, they may
elect to have the entire portion of a lump sum distribution
attributable to pre-1974 participation taxed at a 20 percent

rate.

reciation
If a lump sum distribution includes securities of the
("NUA")
employer corporation, the "net unrealized appreciation"
in the employer securities is generally not subject to tax until
the securities are sold, unless the recipient elects to have the
normal distribution
rules apply. When the securities are sold,
the NUA is treated as long-term capital gain.
If a distribution
is not a lump sum distribution, only the NUA attributable to the
employee's own contributions may be excluded from income under
these special rules.
Net Unrealized

A

Pro osal
The proposal would eliminate most of the restrictions
on the
types of distributions
eligible for rollover treatment, and would
eliminate 5-year forward averaging for lump sum distributions.
It would, however, continue to prohibit the rollover of employee
contributions.
It would also retain the current law treatment of
NUA, and the special capital
gains and forward averaging rules
available to participants who attained age 50 before January 1,

1986.

Position
We believe
that the qualified plan distribution rules are
excellent candidate for simplification.
The tax treatment
of
qualified plan distributions is unnecessarily complex. The

Administration

an

-13—

statutory rules for determining when a distribution can be rolled
over into another qualified plan or IRA run well over 2000 words,
and present innumerable
interpretive issues. The steady
accumulation of special rules and tax preferences over time has
resulted in a statutory scheme with no clear structure or
underlying rationale.
Moreover, the burden of this complexity
falls primarily on plan participants and beneficiaries, who must
understand the rules (or hire an attorney or accountant to help
them) to make use of them.
By way of example, the forward
averaging and other tax preferences applicable to lump sum
distributions were added at a time when marginal tax rates were
much

higher

than they are today and taxpayers

faced a multi-

tiered rate structure.
Given the 1986 changes in the basic
structure of the individual rates and brackets, these highly
complex provisions are no longer needed.
This would be
particularly true if rollovers were liberalized as contemplated
by the

bill.

could support this portion of the bill if the proposal
were modified in several ways.
First, no true simplification of
the tax treatment of distributions
is possible without
eliminating the NUA exclusion.
Retention of the exclusion
requires the retention of the concept of a lump sum distribution,
which is one of the principal sources of complexity under current
law. The exclusion is no longer necessary to protect participants from possible inability to pay tax on a distribution,
because, under the proposal, lump sum distributions would always
be able to be rolled over into a qualified plan or IRA. Also,
the computation of NUA on employer securities needed to apply to
apply existing law creates significant recordkeeping and basis
of
The determination
determination
for taxpayers.
requirements
the qualified trust's cost basis for employer securities
purchased at various times and for various prices is a burden
even for computerized recordkeepers.
We

Second, we believe that the special transition rules making
certain preferential treatment available to taxpayers who
attained age 50 before January 1, 1986, should be eliminated.
Most taxpayers who are now currently eligible to use 5-year
forward averaging are also eligible to use these grandfather
rules (because any individual who is now over 59-1/2 was also 50
years or older in 1986). Furthermore, the 10-year forward
averaging rules are generally more advantageous for them unless
For most
the size of their lump sum distribution is very large.

taxpayers, then, the repeal of 5-year forward averaging alone
will have little effect in short-term, and will not appreciably
simplify the determination of their tax liabilities.

-13—

statutory rules for determining when a distribution can be rolled
over into another qualified plan or IRA run well over 2000 words'
and present innumerable
interpretive issues. The steady
accumulation of special rules and tax preferences over time has
resulted in a statutory scheme with no clear structure or
underlying rationale.
Moreover, the burden of this complexity
falls primarily on plan participants and beneficiaries, who must
understand the rules (or hire an attorney or accountant to help
them) to make use of them.
By way of example, the forward
averaging and other tax preferences applicable to lump sum
distributions were added at a time when marginal tax rates were
much higher than they are today and taxpayers
faced a multitiered rate structure.
Given the 1986 changes in the basic
structure of the individual rates and brackets, these highly
complex provisions are no longer needed.
This would be
particularly true if rollovers were liberalized as contemplated
by the bill.
could support this portion of the bill if the proposal
in several ways. First, no true simplification of
the tax treatment of distributions
is possible without
eliminating the NUA exclusion.
Retention of the exclusion
requires the retention of the concept of a lump sum distribution,
which is one of the principal sources of complexity under current
law. The exclusion is no longer necessary to protect participants from possible inability to pay tax on a distribution,
because, under the proposal, lump sum distributions would always
be able to be rolled over into a qualified plan or IRA. Also,
the computation of NUA on employer securities needed to apply to
apply existing law creates significant recordkeeping and basis
determination
for taxpayers.
The determination
of
requirements
the qualified trust's cost basis for employer securities
purchased at various times and for various prices is a burden
even for computerized
recordkeepers.
Ne

were modified

believe that the special transition rules making
certain preferential treatment available to taxpayers who
attained age 50 before January 1, 1986, should be eliminated.
Most taxpayers who are now currently eligible to use 5-year
forward averaging are also eligible to use these grandfather
rules (because any individual who is now over 59-1/'2 was also 50
years or older in 1986). Furthermore, the 10-year forward
averaging rules are generally more advantageous for them unless
is very large. For most
the size of their lump sum distribution
taxpayers, then, the repeal of 5-year forward averaging alone
will have little effect in short-term, and will not appreciably
simplify the determination of their tax liabilities.
Second,

we

-14Section 202. Qualified Plans Must Provide for Transfers
Certain Distributions to Other Plans
Current

of

Law

places various restrictions on pre —retirement
distributions of benefits from qualified plans. When a permissible distribution is made from a plan, it generally is made
directly to the participant or beneficiary and is subject to
a
income tax and, in the case of a premature distribution,
10-percent additional tax. Under certain circumstances, the
recipient of a qualified plan distribution can avoid current
tax by rolling the
income taxation and any 10-percent additional
distribution over into another qualified plan or IRA. Similar
rules apply to tax-sheltered annuities.
The circumstances
under
which such rollovers are permitted under current law are limited,
however, and the rules applicable to them are very complex.
Current

law

Pro osal
The proposal would require qualified plans to make
"applicable distributions" in the form of direct trusteeto-trustee transfers to "eligible transferee plans. " Applicable
distributions would generally include any distributions over $500
permitted to be made by a plan that would have been subject to
the 10 percent additional tax on early distributions
if they had
been distributed directly to the participant or beneficiary.
Exceptions to the required transfer provisions would be provided
for certain distributions,
including any distribution after the
employee attains age 55, and distributions
of employee
contributions.

Eligible transferee plans would include IRAs and qualified
defined contribution plans that accepted such transfers.
Under
the proposal, however, qualified plans would not be required to
accept such transfers.

Administration

Position

The Administration
is continuing to study the issues which
are addressed in the proposal.
Figures indicate employees are
spending a significant portion of their retirement savings before
retirement by virtue of failing to roll over distributions
received on change of employment.
The Department
of Labor has
serious concerns about the implications of the losses of
retirement savings.
Finding an effective and affordable way to
reduce those losses is clearly important.
We have been working
with the Department in evaluating possible solutions, we will
continue to cooperate with efforts to address this important
concern. However, we do not endorse the proposal today because
of tax policy concerns, not the least of which is revenue.

-14Section 202. Qualified Plans Must Provide for Transfers
Certain Distributions to Other Plans
Current

of

Law

places various restrictions on pre-retirement
distributions of benefits from qualified plans. When a permissible distribution is made from a plan, it generally is made
directly to the participant or beneficiary and is subject to
income tax and, in the case of a premature distribution,
a
10-percent additional tax' Under certain circumstances, the
recipient of a qualified plan distribution can avoid current
income taxation and any 10-percent additional
tax by rolling the
distribution over into another qualified plan or IRA. Similar
rules apply to tax-sheltered annuities.
The circumstances
under
which such rollovers are permitted under current law are limited,
however, and the rules applicable to them are very complex.
Current

law

Pro osal
would require qualified plans to make
distributions" in the form of direct trusteeto-trustee transfers to "eligible transferee plans. " Applicable
distributions would generally include any distributions over $500
permitted to be made by a plan that would have been subject to
the 10 percent additional tax on early distributions
if they had
been distributed directly to the participant or beneficiary.
Exceptions to the required transfer provisions would be provided
for certain distributions,
including any distribution after the
employee attains age 55, and distributions
of employee
contributions.
Eligible transferee plans would include IRAs and qualified
defined contribution plans that accepted such transfers.
Under
the proposal, however, qualified plans would not be required to
accept such transfers.
Administration
Position
The

proposal

"applicable

The Administration
is continuing to study the issues which
are addressed in the proposal.
Figures indicate employees are
spending a significant portion of their retirement savings before
retirement by virtue of failing to roll over distributions
received on change of employment.
The Department
of Labor has
serious concerns about the implications of the losses of
retirement savings.
Finding an effective and affordable way to
reduce those losses is clearly important.
We have been working
with the Department in evaluating possible solutions, we will
continue to cooperate with efforts to address this important
concern. However, we do not endorse the proposal today because
of tax policy concerns, not the least of which is revenue.

-15Section 203.
Current

Re

uired Distributions

Law

Under current law, distributions
under most tax-favored
retirement arrangements must begin by no later than April 1st of
the calendar year following the calendar year in which the participant attains age 70-1/'2, regardless of when the participant
retires. This requirement generally applies to all qualified
plans, IRAs, tax-sheltered retirement annuities and custodial
accounts, and eligible deferred compensation plans of certain

governmental

and tax-exempt

employers.

Pro osal

proposal

The

would

amend

current

law

to return

to the

law in

effect prior to the changes made by the Tax Reform Act of 1986.
would generally be required to begin by no
Thus, distributions
later than April 1st of the calendar year following the later of
(1) the calendar year in which the participant attains age 70, or
(2), except in the case of distributions from an IRA or to a
5-percent owner of the employer, the calendar year in which the
participant retires. In the case of an employee who is permitted
to delay required distributions until after retirement, the
proposal would require the employee's accrued benefit to be
actuarially increased to take into account the period after age
70 during

the plan.

which

Administration

does not receive distributions

the employee

under

Position

We

do not oppose

delayed

distributions

allowing

a delay

in required

distributions

until actual retirement except with respect to 5-percent owners,
provided that the actuarial adjustment required in the case of

is fair

Title III — Miscellaneous
Section 301. Treatment of
Current

and

Leased

realistic.

Em

lo ees

Law

Section 414(n) of the Code provides that, for purposes of
certain retirement and welfare benefit provisions of the Code,
leased employee is treated as an employee of the recipient of the
leased employee's services. In order to be treated as a leased
employee, a person must not be a common-law employee of the reciFirst, the
pient and, in addition, must meet three requirements.
the
recipient
to
pursuant
to an
services
person must provide
leasing oragreement between the recipient and a third-party
Second, the person must provide the services to the
ganization.

-15—

Section 203.
Current

Re

uired Distributions

Law

Under current law, distributions
under most tax-favored
retirement arrangements must begin by no later than April 1st of
the calendar year following the calendar year in which the participant attains age 70-1/2, regardless of when the participant
retires. This requirement generally applies to all qualified
plans, IRAs, tax-sheltered retirement annuities and custodial
accounts, and eligible deferred compensation plans of certain

governmental

and tax-exempt

employers.

Pro osal
The

proposal

would

amend

current

law

to return to the law in

effect prior to the changes made by the Tax Reform Act of 1986Thus, distributions
would generally be required to begin by no
later than April 1st of the calendar year following the later of
(1) the calendar year in which the participant attains age 70, or
(2), except in the case of distributions from an IRA or to a
5-percent owner of the employer, the calendar year in which the
participant retires. In the case of an employee who is permitted
to delay required distributions until after retirement, the
proposal would require the employee's accrued benefit to be
actuarially increased to take into account the period after age
70 during

the plan.

which

Administration

the employee

does not receive distributions

under

Position

We do not oppose allowing
a delay in required distributions
until actual retirement except with respect to 5-percent owners,
provided that the actuarial adjustment required in the case of
delayed distributions
is fair and realistic.

Title III — Miscellaneous
Section 301. Treatment of Leased
Current

Em

lo ees

Law

Section 414(n) of the Code provides that, for purposes of
certain retirement and welfare benefit provisions of the Code, a
leased employee is treated as an employee of the recipient of the
leased employee's services. In order to be treated as a leased

employee, a person must not be a common-law employee of the recipient and, in addition, must meet three requirements.
First, the
person must provide services to the recipient pursuant to an
agreement between the recipient and a third-party
leasing ormust
provide the services to the
ganization.
Second, the person

-16recipient on a substantially full-time basis for at least one
year. And, third, the services must be of a type historically
performed by common-law employees in the business field of the
recipient.
Pro osal
The

eliminate

proposal

would
be of a type

the third

requirement

that the

historically performed by common-law
services
In place of
employees in the business field of the recipient.
the "historically performed" standard, the proposal would substitute a new requirement that the services be performed under
the control of the recipient.
Administration

Position

because we understand its
intent is to limit section 414(n) to the abuses Congress
originally sought to target when it enacted the section in 1983.
The proposal aims to overturn the expansive reading of the
"historically performed" standard adopted in proposed regulations
issued under that section in August 1987. From an administrative
perspective, we intend to withdraw those portions of the proposed
regulations relating to the "historically performed" standard
under section 414(n) and to reissue them in substantially
modified form in order to achieve much the same objective as the
Future administrative
proposal.
guidance, of course, will be
influenced by the proposal now under consideration.
We

do not oppose

the proposal

believe that any new standard adopted by Congress should
be clear in its application to specific cases.
In this regard,
we suggest
that detailed examples be provided to demonstrate the
intended application of the standard.
In particular, it should
"control"
be made clear that the term
in this context is not to
be determined by reference to employment
tax concepts. Furthermore, control should be determined based on the substance and not
The
merely the form of the arrangement
adopted by the parties.
new standard
should also be crafted so that it unambiguously
covers cases of abuse without at the same time burdening
employers with unnecessary testing under the statute.
We are
willing to work with the Congress to develop the proposal further
along the lines we have suggested.
We

Section 302.
Current

Elimination

of Half-Year

Re

uirements

Law

of employee benefit provisions, such as those
relating to permissible and required distributions from
tax-qualified retirement plans, are based on the attainment
age 59-1/2 or age 70-1/2.
A

number

of

—16-

recipient on a substantially full-time basis for at least one
year. And, third, the services must be of a type historically
performed by common-law employees in the business field of the
recipient.
Pro osal

proposal

eliminate

services be of

would
a type

Administration

Position

The

the third

requirement

that the

historically performed by common-law
In place of
employees in the business field of the recipient.
the "historically performed" standard, the proposal would substitute a new requirement that the services be performed under
the control of the recipient.

because we understand its
intent is to limit section 414(n) to the abuses Congress
originally sought to target when it enacted the section in 1983.
The proposal aims to overturn the expansive reading of the
"historically performed" standard adopted in proposed regulations
issued under that section in August 1987. From an administrative
perspective, we intend to withdraw those portions of the proposed
regulations relating to the "historically performed" standard
under section 414(n) and to reissue them in substantially
modified form in order to achieve much the same objective as the
Future administrative
proposal.
guidance, of course, will be
influenced by the proposal now under consideration.
We

do not oppose

the proposal

believe that any new standard adopted by Congress should
be clear in its application to specific cases.
In this regard,
we suggest that detailed
examples be provided to demonstrate the
intended application of the standard.
In particular, it should
be made clear that the term "control" in this context is not to
be determined by reference to employment
tax concepts. Furthermore, control should be determined based on the substance and not
The
merely the form of the arrangement
adopted by the parties.
new standard
should also be crafted so that it unambiguously
covers cases of abuse without at the same time burdening
employers with unnecessary testing under the statute.
We are
~illing to work with the Congress to develop the proposal further
along the lines we have suggested.
We

Section 302. Elimination
Current

of Half-Year

Re uirements

Law

of employee benefit provisions, such as those
relating to permissible and required distributions from
tax-qualified retirement plans, are based on the attainment
age 59-1/2 or age 70-1/'2.
A

number

of

-17Pro osal

the proposal, the half-year requirements would be
so that each reference to age 59-1/2 would become one
to age 59 and each reference to age 70-1/2 would become one to
Under

eliminated
age

70.

Administration
We

Position

do not support

appreciably

simplifies

this proposal.
current

Section 303. Plans Coverin
Current

law.

We

do not

believe

it

Self-Em lo ed Individuals

Law

rules apply to certain
self-employed owner-employees
participating in a tax-qualified
The
retirement plan and controlling more than one business.
control group rules applicable to all employers under section
414 (b) and (c) also apply to businesses controlled by

Special employer

self-employed

aggregation

owner-employees.

Pro osal
The proposal would eliminate the special employer aggregation
rules for self-employed owner-employees and would leave the
generally applicable control group rules in place.

Administration

Position

The generally applicable
We do not oppose the proposal.
control group rules should be sufficient to ensure against
possible abuses with respect to plans maintained by businesses
controlled by self-employed owner-employees.

Section 304.
Current

Full-Fundin

Limitation

of Multiem lo er Plans

Law

Deductible contributions may not be made to a tax-qualified
The full funding limitation
pension plan that is fully funded.
if any, of the lesser of
excess,
mean
the
to
is defined generally
or
(ii) the accrued liabil(i) 150 percent of current liability
ity (including normal cost) under the plan over the lesser of (i)
the fair market value of the plan's assets or (ii) the value of
the plan's assets determined under section 412(c)(2). Valuations
of plan assets are required at least annually.

-17Pro osal

the proposal, the half-year requirements would be
eliminated so that each reference to age 59-1/2 would become one
to age 59 and each reference to age 70-1/2 would become one to
Under

age

70.

Administration
We

Position

do not support

appreciably

simplifies

this proposal.
current

Section 303. Plans Coverin
Current

We

do not

believe

law

it

Self-Em lo ed Individuals

Law

Special employer aggregation rules apply to certain
self-employed owner-employees
participating in a tax-qualified
retirement plan and controlling more than one business.
The

control group rules applicable to all employers under section
414 (b) and (c) also apply to businesses controlled by
self-employed

owner-employees.

Pro osal
The proposal would eliminate the special employer aggregation
rules for self-employed owner-employees and would leave the
generally applicable control group rules in place.

Administration

Position

do not oppose the proposal.
The generally applicable
control group rules should be sufficient to ensure against
possible abuses with respect to plans maintained by businesses
controlled by self-employed owner-employees.
We

Section 304.
Current

Full-Fundin

Limitation

of Multiem lo er Plans

Law

Deductible contributions may not be made to a tax-qualified
The full funding limitation
pension plan that is fully funded.
is defined generally to mean the excess, if any, of the lesser of
(i) 150 percent of current liability or (ii) the accrued liability (including normal cost) under the plan over the lesser of (i)
the fair market value of the plan's assets or (ii) the value of
the plan's assets determined under section 412(c)(2). Valuations
of plan assets are required at least annually.

-18Pro osal

eliminate

the 150-percent-of-currentliability prong in the calculation of the numerator of the full
plans. The
funding definition with respect to multiemployer
valuations
of
multiemployer
plans
proposal would also require
only every three years.
The

Position

Administration
We

would

proposal

oppose the proposal.

to the generally

applicable

Section 305. Affiliation

Maintainin
Current

a Voluntar

It

would

funding

provide

a narrow

exception

rules for one type of plan.

for Em lo ers Jointl
lo ees' Beneficiar Association

Re uirements
Em

Law

regulations, a voluntary employees'
association ("VEBA") is not tax-exempt under section
501(c)(9) of the Code if it benefits employees who do not share
Under

beneficiary

Treasury

common
common bond.
An employment-related
only among employees of the same employer
(or affiliated employers), employees covered by a collective
bargaining agreement, members of a labor union, or employees of
unaffiliated employers doing business in the same line of
business in the same geographic locale. The IRS has interpreted
the same geographic locale requirement as prohibiting a VEBA from
covering nonunion employees of unaffiliated employers located in
more than one state or metropolitan
area. The same geographic
locale requirement was held to be invalid by the 7th Circuit in
Water Qualit
Ass'n Em lo ees' Benefit Cor . v. United States,
795 F. 2d 1303 (1986).

an employment-related
bond generally exists

1

maintained by unaffiliated
employers from the same geographic locale requirement
if they (1)
are in the same line of business, (2) act jointly to perform
tasks which are integral to the activities of each of the
employers, and (3) act jointly to such an extent that the joint
maintenance of a voluntary employees' beneficiary association is
not a major part of the employers' joint activities.
The

proposal

Administration

would

exempt

VEBAs

Position

We oppose the proposal.
The same geographic locale
requirement helps target the tax benefits available under section
501(c)(9) to organizations with the greatest need for support.
The VEBA tax exemption was initially
intended to benefit associations formed and managed by employees of a single employer or of
small local groups of employers, to provide certain welfare bene-

-18Pro osal

eliminate

the 150-percent-of-currentliability prong in the calculation of the numerator of the full
funding definition with respect to multiemployer
plans. The
proposal would also require valuations of multiemployer
plans
three
years.
every
only

Position

Administration
We

would

proposal

The

oppose the proposal.

to the generally

applicable

Section 305. Affiliation

Maintainin
Current

a Voluntar

It

provide a narrow exception
rules for one type of plan.

would

funding

for Em lo ers Jointl
ees'
lo
Beneficiar Association

Re uirements
Em

Law

regulations, a voluntary employees'
association ("VEBA") is not tax-exempt under section
501(c)(9) of the Code if it benefits employees who do not share
Under

beneficiary

Treasury

an employment-related
bond generally exists

common
common bond.
An employment-related
only among employees of the same employer
(or affiliated employers), employees covered by a collective
bargaining agreement, members of a labor union, or employees of
unaffiliated employers doing business in the same line of
business in the same geographic locale
The IRS has interpreted
the same geographic locale requirement as prohibiting a VEBA from
covering nonunion employees of unaffiliated employers located in
more than one state or metropolitan
area. The same geographic
locale requirement was held to be invalid by the 7th Circuit in
Water Qualit
Ass'n Em lo ees' Benefit Cor . v. United States,
795 F. 2d 1303 (1986).

1
The

employers

exempt VEBAs maintained by unaffiliated
from the same geographic locale requirement
if they

proposal

would

(1)

are in the same line of business, (2) act jointly to perform
tasks which are integral to the activities of each of the
employers, and (3) act jointly to such an extent that the joint
maintenance of a voluntary employees' beneficiary association is
not a major part of the employers' joint activities.
Administration

Position

We oppose the proposal.
The same geographic locale
requirement helps target the tax benefits available under section
501(c)(9) to organizations with the greatest need for support.
The VEBA tax exemption was initially
intended to benefit associations formed and managed by employees of a single employer or of
small local groups of employers, to provide certain welfare bene-

-19—

fits to their

in situations where such benefits would not
otherwise have been available.
Congress was concerned that such
associations might not be viable without a tax exemption.
By
contrast, larger associations covering employees of unrelated
employers in different geographic areas are more likely to be
viable even without a tax exemption, and the benefits they
provide are more likely to be able to be provided through
commercial insurance.
members

The fact that unaffiliated
employers would be required under
the proposal to conduct certain joint activities does not address
these concerns. Moreover, we are concerned that the nature and
required level of joint activities under the proposal is so
unclear that the exemption will apply to a large group of
This would have serious revenue consequences and, in
employers.
addition, would undermine those provisions of the Code that
prescribe the treatment of insurance companies.

Although

we

oppose

the proposed

exemption

from the geographic

locale requirement for the reasons state above, we understand
that the one-state or metropolitan area rule may be too
restrictive in states or metropolitan areas with too few
employees in the same industry to form an economical
multiple-employer
VEBA. A better alternative
to the proposal in
the bill that would be more consistent with the purpose of
section 501(c)(9) would be to limit VEBAs to a
three-contiguous-state
area, or a larger area if the Secretary
determined that the employer group in the three-state area was
too small to make self-insurance economical.
Section 306. Treatment
Current

of Certain Governmental

Plans

Law

Excess benefit plans of governmental and tax-exempt employers
providing benefits for certain employees in excess of the section
415 limitations on benefits and contributions under qualified
plans are subject to the provisions of section 457, which include
an annual cap on benefits of $7, 500 (or, if less, 33-1/3 percent
of compensation).

Benefits payable under qualified defined benefit plans
generally are limited to the lesser of $90, 000 (indexed) or 100
of circumstances may give rise
A number
percent of compensation.
to required adjustments to these limitations, including
situations where benefits commence before age 62, in the case of
plan, or where there is less than ten years of
a governmental
service or participation in the plan.

-19—

fits to their

members in situations where such benefits would not
have been available.
Congress was concerned that such
associations might not be viable without a tax exemption.
By
contrast, larger associations covering employees of unrelated
employers in different geographic areas are more likely to be
viable even without a tax exemption, and the benefits they
provide are more likely to be able to be provided through

otherwise

commercial

insurance.

fact that unaffiliated employers would be required under
the proposal to conduct certain joint activities does not address
these concerns. Moreover, we are concerned that the nature and
required level of joint activities under the proposal is so
The

unclear that the exemption will apply to a large group of
This would have serious revenue consequences and, in
employers.
addition, would undermine those provisions of the Code that
prescribe the treatment of insurance companies.
Although

we

oppose the proposed

exemption

from the geographic

locale requirement for the reasons state above, we understand
that the one-state or metropolitan area rule may be too
restrictive in states or metropolitan areas with too few
employees in the same industry to form an economical
multiple-employer
VEBA. A better alternative
to the proposal in
the bill that would be more consistent with the purpose of
section 501(c)(9) would be to limit VEBAs to a
three-contiguous-state
area, or a larger area if the Secretary
determined that the employer group in the three-state area was
too small to make self-insurance economical.
Section 306. Treatment
Current

of Certain Governmental

Plans

Law

Excess benefit plans of governmental and tax-exempt employers
providing benefits for certain employees in excess of the section
415 limitations on benefits and contributions under qualified
plans are subject to the provisions of section 457, which include
an annual cap on benefits of $7, 500 (or, if less, 33-1/3 percent
of compensation).

Benefits payable under qualified defined benefit plans
generally are limited to the lesser of $90, 000 (indexed) or 100
of circumstances may give rise
A number
percent of compensation.
to required adjustments to these limitations, including
situations where benefits commence before age 62, in the case of
plan, or where there is less than ten years of
a governmental
service or participation in the plan.

-20Pro osal

proposal would exempt governmental excess benefit plans
from the provisions of section 457. The proposal would also
plans from the 100 percent of
exempt benefits under governmental
the proposal would exempt
limitation.
Finally,
compensation
certain survivor and disability benefits under governmental plans
limitation, from the
from the 100 percent of compensation
62
commencement,
and from the
for
pre-age
adjustment
participation and service adjustments generally required to be
The proposal
on benefits.
made to the section 415 limitations
would be effective for taxable years beginning after 1986.
The

Position

Administration

The
oppose the retroactive excess benefit plan proposal.
of
the
excess
is
drafted
to
cover
scope
narrowly
proposal
only
benefit plans maintained by one limited group of those employers
subject to section 457.
We

We oppose the proposal
creating a retroactive exception to
the 100 percent of compensation limitation.
The proposal would
violate the long-standing policy against permitting benefits
payable under qualified defined benefit plans to exceed 100
percent of compensation, and does not present an appropriate case

for

an

making

exception to that policy.

also oppose the survivor and disability benefits proposal.
proposal is retroactive and narrowly drafted to apply only to
a limited group of employers.
We

The

Section 307. Modifications
Current

of

Sim

lified

Em

lo ee Pensions

Law

law, an employer may establish a SEP that
accepts elective salary reduction contributions.
In order for
such an arrangement
to qualify, the employer generally may have
no more than 25 nonexcludible
employees, at least 50 percent of
all nonexcludible employees must elect to make such contributions, and the deferral percentage of each eligible highly
compensated employee must not exceed 125 percent of the average
deferral percentage of all eligible nonhighly compensated
Under

employees.

current

If

an employer

maintains

a SEP (with

or without

a

feature), the plan generally must be provided to
all employees who have performed service for the employer in at
least 3 out of the last 5 years.
salary reduction

-20Pro osal

proposal would exempt governmental excess benefit plans
from the provisions of section 457. The proposal would also
plans from the 100 percent of
exempt benefits under governmental
limitation.
Finally, the proposal would exempt
compensation
certain survivor and disability benefits under governmental plans
limitation, from the
from the 100 percent of compensation
and from the
adjustment for pre-age 62 commencement,
participation and service adjustments generally required to be
The proposal
on benefits.
made to the section 415 limitations
would be effective for taxable years beginning after 1986.
The

Position

Administration

retroactive

excess benefit plan proposal.
The
scope of the proposal is narrowly drafted to cover only excess
benefit plans maintained by one limited group of those employers
subject to section 457.
We

oppose the

We oppose the proposal
creating a retroactive exception to
the 100 percent of compensation limitation.
The proposal would
violate the long-standing policy against permitting benefits
payable under qualified defined benefit plans to exceed 100
percent of compensation, and does not present an appropriate case

for

making

We

an

exception to that policy.

also oppose the survivor and disability benefits proposal.
retroactive and narrowly drafted to apply only to
of employers.

The proposal is
a limited group

Section 307. Modifications
Current

of

Sim

lified

Em

lo ee Pensions

Law

Under current law, an employer may establish a SEP that
accepts elective salary reduction contributions.
In order for
such an arrangement
to qualify, the employer generally may have
no more than 25 nonexcludible
employees, at least 50 percent of
all nonexcludible employees must elect to make such contributions, and the deferral percentage of each eligible highly
compensated employee must not exceed 125 percent of the average
deferral percentage of all eligible nonhighly compensated

employees.

If

an employer

maintains

a SEP (with

or without

a

feature), the plan generally must be provided to
all employees who have performed service for the employer in at
least 3 out of the last 5 years.
salary reduction

-21Pro osal
with up to 100 nonexcludible employees to set up salary reduction SEPs and would
In addition,
eliminate the 50-percent participation requirement.
the proposal would exempt a salary reduction SEP from the otherwise applicable ADP test if a 3-percent nonelective employer
contribution were made on behalf of all eligible nonhighly
compensated employees.
Finally, the proposal generally would require SEPs of all types to cover every employee with at least one
year of service with the employer rather than 3 years of service
out of the last 5.
The

proposal

Administration

would

permit

employers

Position

We oppose the proposal
to increase to 100 the maximum number
of nonexcludible employees an employer may have in order to adopt
a salary reduction SEP. We believe that the general rules applicable to elective deferrals are more appropriate for larger

employers.

We also oppose the proposal
to eliminate the 50-percent
participation test and the proposal to create an exemption from
the ADP test applicable to salary reduction SEPs. Our reasons
for so doing are largely the same as those set forth earlier in
this statement relating to section 105 of the bill. As a way of
of salary reduction SEPs, considsimplifying the administration
eration could be given to modifying the average deferral percentage test applicable to such plans to operate based on the average
deferral percentage for eligible nonhighly compensated employees
as of the preceding year (or on a statutorily predetermined
percentage for the first plan year of a salary reduction SEP in
the case of an employer that has not previously maintained one.
We do not oppose the proposal
to expand coverage under SEPs
all
generally
including
employees with at least one year of
by
service

Section 308. Contributions
Current

on

Behalf of Disabled

Em

lo ees

Law

An employer
contributions to
may make certain nonforfeitable
tax qualified defined contribution plan on behalf of any
disabled participant who is not highly compensated if an election

a

is

made.

Pro osal
made

The proposal would permit nonforfeitable
on behalf of highly compensated disabled

contributions
participants

to be
and

-21Pro osal
The proposal would permit employers with up to 100 nonexcludible employees to set up salary reduction SEPs and would
In addition,
eliminate the 50-percent participation requirement.
the proposal would exempt a salary reduction SEP from the otherwise applicable ADP test if a 3-percent nonelective employer
contribution were made on behalf of all eligible nonhighly
compensated employees.
Finally, the proposal generally would require SEPs of all types to cover every employee with at least one
year of service with the employer rather than 3 years of service
out of the last 5.

Position

Administration

We oppose the proposal
to increase to 100 the maximum number
of nonexcludible employees an employer may have in order to adopt
a salary reduction SEP. We believe that the general rules applicable to elective deferrals are more appropriate for larger

employers.

also oppose the proposal to eliminate the 50-percent
participation test and the proposal to create an exemption from
the ADP test applicable to salary reduction SEPs. Our reasons
for so doing are largely the same as those set forth earlier in
this statement relating to section 105 of the bill. As a way of
of salary reduction SEPs, considsimplifying the administration
eration could be given to modifying the average deferral percentage test applicable to such plans to operate based on the average
deferral percentage for eligible nonhighly compensated employees
as of the preceding year (or on a statutorily predetermined
percentage for the first plan year of a salary reduction SEP in
the case of an employer that has not previously maintained once
We

We

by

do not oppose

generally

service

including

the proposal

all

Section 308. Contributions
Current
An

on

Behalf of Disabled

Em

lo ees

Law

employer

may

a tax qualified
disabled participant

is

to expand coverage under SEPs
with at least one year of

employees

made.

make

defined

who

certain nonforfeitable contributions
contribution plan on behalf of any

is not highly

compensated

if

an

to

election

Pro osal
The
made on

proposal would permit nonforfeitable contributions
behalf of highly compensated disabled participants

to be
and

-22would waive the
on behalf of all

Administration

election requirement,
disabled participants.

if

contributions

were made

Position

not oppose the proposal if it were modified to
insure that the provision does not operate in a manner that
We are
discriminates in favor of highly compensated employees.
concerned that, as presently drafted, contributions during
disability could be provided for under a plan during years when
the only disabled participants are highly compensated and such
provisions could then be deleted in subsequent years when the
only disabled participants were nonhighly compensated.
We

would

Section 309. Distributions
Current

Under

Rural Coo erative

Plans

Law

Distributions

from cash or deferred arrangements
may be made
59-1/'2,
upon attainment
of age
from profitand distributions
sharing plans may be made in certain events, including attainment
of a stated age
Distributions from pension plans (including
money purchase pension plans) generally must not commence until

retirement.

Pro osal
The proposal would permit distributions
after attainment of
age 59 from a rural cooperative plan which includes a cash or
deferred arrangement. Such distributions would not be limited to

the cash or deferred portion of the plan.
The proposal would be
if included in the Technical and Miscellaneous
Revenue Act of 1988.

effective as

Administration

Position

oppose this proposal because it creates a retroactive
special exception for a limited group of tax qualified plans.
We believe
the current law restrictions on pre-retirement
distributions from pension plans are appropriate.
We

Section 310.
Current

Re

orts of Pension

and Annuit

Pa ments

Law

Persons maintaining or administering
certain tax-favored
retirement arrangements are required to file reports in the
nature of information returns regarding the arrangements with the
IRS and with the participants,
owners, or beneficiaries under the
arrangements.
Under current law, failure to file the reports is

-22would waive the
on behalf of all

Administration

election requirement,
disabled participants.

if

contributions

were made

Position

not oppose the proposal if it were modified to
insure that the provision does not operate in a manner that
We are
discriminates in favor of highly compensated employees.
contributions
during
drafted,
as
presently
concerned that,
disability could be provided for under a plan during years when
the only disabled participants are highly compensated and such
provisions could then be deleted in subsequent years when the
only disabled participants were nonhighly compensated.
We

would

Section 309. Distributions
Current

Under

Rural Coo erative

Plans

Law

Distributions

from cash or deferred arrangements
may be made
of age 59-1/2, and distributions from profitupon attainment
sharing plans may be made in certain events, including attainment
of a stated age. Distributions from pension plans (including
money purchase pension plans) generally must not commence until

retirement.

Pro osal

proposal would permit distributions after attainment of
age 59 from a rural cooperative plan which includes a cash or
deferred arrangement. Such distributions would not be limited to
the cash or deferred portion of the plan.
The proposal would be
effective as if included in the Technical and Miscellaneous
The

Revenue

Act of 1988.

Administration

Position

We oppose this proposal
because it creates a retroactive
special exception for a limited group of tax qualified plans.
We believe
the current law restrictions on pre-retirement
distributions from pension plans are appropriate.

Section 310.
Current

Re

orts of Pension

and Annuit

Pa ments

Law

Persons maintaining or administering
certain tax-favored
retirement arrangements are required to file reports in the
nature of information returns regarding the arrangements with the
IRS and with the participants,
owners, or beneficiaries under the
arrangements.
Under current law, failure to file the reports is

-23subject to specific penalties rather than the generally
applicable penalty for failure to file information returns.
Pro osal
Under

the proposal, failure to
retirement arrangements

file reports

regarding

that are in the nature of
information reports would be subject to the generally applicable
penalty for failure to file information returns.
tax-favored

Administration
We

Position

do not oppose

the proposal.

"Church Retirement

Current

S.

2902

Benefits Simplification

Act of 1990"

Law

retirement and welfare benefit plans are subject to a
of special rules that are generally easier to satisfy than
comparable rules applicable to plans maintained by other private
In some cases, church plans are exempt from those
employers.
rules altogether.
Church

number

For example, qualified church retirement plans are generally
subject to pre-ERISA rather than current-law participation,
coverage, vesting and funding requirements.
They are also exempt
from the accrual requirements,
qualified joint and survivor ansurvivor annuity requirements,
nuity and qualified pre-retirement
anti-alienation requirements, and a number of other requirements

applicable

to most qualified

plans.

annuities are exempt from all
and related requirements
of the coverage, nondiscrimination
generally applicable to such annuities, and the limitations
applicable to contributions under such annuities are higher than
for comparable plans maintained by many other tax-exempt organizations. Church nonqualified deferred compensation plans are
requireexempt from the deferral limits and other qualification
church
section
457
of
the
Code.
Finally,
group-term
ments of
life insurance plans are exempt from the nondiscrimination
generally applicable to such plans.
requirements

Similarly,

church

tax-sheltered

definition of a church for purposes of these and other
special rules varies, depending on the particular rule involved.
For purposes of the special rules applicable to church qualified
The

retirement plans, churches generally include churches and conventions or associations of churches, as well as certain organizations controlled by or associated with churches. The definition

-23subject to specific penalties rather than the generally
applicable penalty for failure to file information returns.
Pro osal
Under

the proposal, failure to
retirement arrangements

file reports

regarding

that are in the nature of
information reports would be subject to the generally applicable
penalty for failure to file information returns.
tax-favored

Administration
We

Position

do not oppose

the proposal.

"Church Retirement

Current

S.

2902

Benefits Simplification

Act of 1990"

Law

retirement and welfare benefit plans are subject to a
number of special rules that are generally easier to satisfy than
comparable rules applicable to plans maintained by other private
In some cases, church plans are exempt from those
employers.
rules altogether.
Church

For example, qualified church retirement plans are generally
subject to pre-ERISA rather than current-law participation,
coverage, vesting and funding requirements.
They are also exempt
from the accrual requirements,
qualified joint and survivor ansurvivor annuity requirements,
nuity and qualified pre-retirement
anti-alienation requirements, and a number of other requirements
applicable to most qualified plans.
Similarly, church tax-sheltered annuities are exempt from all
and related requirements
of the coverage, nondiscrimination
generally applicable to such annuities, and the limitations
applicable to contributions under such annuities are higher than
for comparable plans maintained by many other tax-exempt organizations. Church nonqualified deferred compensation plans are
requireexempt from the deferral limits and other qualification
ments of section 457 of the Code. Finally, church group-term

life

insurance plans are exempt from the nondiscrimination
generally applicable to such plans.
requirements

definition of a church for purposes of these and other
special rules varies, depending on the particular rule involved.
For purposes of the special rules applicable to church qualified
retirement plans, churches generally include churches and conventions or associations of churches, as well as certain organizations controlled by or associated with churches. The definition
The

-24-

is generally the same for purposes of the rules applicable to
church group-term life insurance plans, except that church universities, colleges, hospitals, and organizations whose basis for
exemption is similar to that for church hospitals are excluded.
is significantly narrower, however, for purposes
The definition
of the special rules applicable to tax-sheltered annuities and
nonqualified deferred compensation plans, generally covering only
churches and conventions or associations of churches, and certain
qualified church-controlled organizations ("QCCOs") that do not
derive a significant part of their income from the government or
commercial

activities.

Pro osal
The

proposal

respects. First,
qualified church

it

would change current law in three significant
would consolidate the rules applicable to
retirement plans in one new section of the Code.

it

eliminate differences among the definitions of
for purposes of these and other special rules by
generally adopting the definition used for purposes of group-term
life insurance under current law. Finally, it would add a number
of new special rules for church plans, as so defined, to the
Second,
churches

would

Code.

The proposed rules would exempt church plans from the trust
requirement generally applicable to qualified retirement plans,
and exempt qualified church retirement
plans, tax-sheltered
annuities, and self-insured medical plans from the nondiscrimination requirements applicable to such plans under current law.
They would also narrow the definition of highly compensated
employee for purposes of qualified church retirement plans (in
some cases eliminating
the one-highly compensated employee
minimum under current law), eliminate
ministers from consideration in testing retirement and welfare plans (including
non-church plans) for compliance with applicable minimum
coverage, nondiscrimination
and similar rules, exempt church
plans from the minimum participation requirements
of section
401(a)(26), modify the vesting and coverage rules applicable to
tax-sheltered annuities, limit the application of the aggregation
rules to church organizations, and allow qualified voluntary
("QVECs") for church plans.
employee contributions

of the changes discussed above would apply retroactively
respect to violations of the requirements of sections 401(a)
and 403(b) and other rules for years beginning before January 1,
1990.

with

Many

The proposal would also make a number of technical changes
largely designed to clarify current law or make it easier to
These changes would include rules clarifying the ability
apply.
of self-employed ministers to participate in church plans, and
addressing a number of other issues.

-24-

is generally the same for purposes of the rules applicable to
church group-term life insurance plans, except that church universities, colleges, hospitals, and organizations whose basis for
exemption is similar to that for church hospitals are excluded.
is significantly narrower, however, for purposes
The definition
of the special rules applicable to tax-sheltered annuities and
nonqualified deferred compensation plans, generally covering only
churches and conventions or associations of churches, and certain

qualified

derive a
commercial

church-controlled
organizations ("QCCOs") that do not
of
their income from the government or
part

significant

activities.

Pro osal
The

proposal

respects. First,
qualified church

it

would change current law in three significant
would consolidate the rules applicable to
retirement plans in one new section of the Code.

it

eliminate differences among the definitions of
for purposes of these and other special rules by
generally adopting the definition used for purposes of group-term
life insurance under current law. Finally, it would add a number
of new special rules for church plans, as so defined, to the
Second,
churches

would

Code.

The proposed rules would exempt church plans from the trust
requirement generally applicable to qualified retirement plans,
and exempt qualified church retirement
plans, tax-sheltered
annuities, and self-insured medical plans from the nondiscrimination requirements applicable to such plans under current law.
They would also narrow the definition of highly compensated
employee for purposes of qualified church retirement plans (in
some cases eliminating
the one-highly compensated employee
minimum under current law), eliminate
ministers from consideration in testing retirement and welfare plans (including
non-church plans) for compliance with applicable minimum
coverage, nondiscrimination
and similar rules, exempt church
plans from the minimum participation requirements of section
401(a)(26), modify the vesting and coverage rules applicable to
tax-sheltered annuities, limit the application of the aggregation
rules to church organizations, and allow qualified voluntary
employee contributions
("QVECs") for church plans.

of the changes discussed above would apply retroactively
respect to violations of the requirements of sections 401(a)
and 403(b) and other rules for years beginning before January 1,
1990.

with

Many

also

a number of technical changes
largely
to clarify current law or make it easier to
These changes would include rules clarifying the ability
apply.
of self-employed ministers to participate in church plans, and
addressing a number of other issues.
The

proposal
designed

would

make

-25Administration

Position

The Administration
opposes the proposal, except for certain
technical changes that clarify current law or make it simpler to
apply to church plans.
Specifically,

believe the proposed exemption from the trust and
nondiscrimination
for most qualified church
requirements
retirement plans and tax-sheltered annuities is not justified
structures or polity,
by differences in church organizational
or other unique attributes of churches or church plans.
Church employees are entitled to the same safeguards as
regardless of their
employees of other organizations,
employer's internal administration.
We have similar
reservations about most of the the other new special rules
for church plans in the proposal.
The proposed amnesty for
such plans for plan years beginning prior to January 1, 1990,
is contrary to our general policy against retroactive relief
from prior compliance obligations.

We

2.

oppose the extension of the special rules currently
applicable only to QCCOs to all church-controlled or affiliated organizations (other than hospitals and universities) to
which the special qualified church retirement plan rules now

We

to provide special
apply, because it is inappropriate
treatment reserved generally for churches to organizations
that function more as secular charities or commercial

We are, however,
sensitive to problems that
enterprises.
exist in applying the QCCO definition, particularly the
source-of-income rules, and would be willing to work with the
staff to develop a simplified definition.
3. We oppose the consolidation of the special rules applicable
to qualified church retirement plans in one section of the
Code. We believe that the current statutory approach of
exempting church plans from certain provisions that are
difficult to apply or inappropriate in the church plan
context is the right approach, because it applies to the
extent possible the same retirement policy for all employers
and employees, and does not tend to perpetuate
and enhance
differences between the treatment of church and other plans.
4. Some of the technical items in the proposal, e. cC. , the
clarification of the ability of self-employed ministers to
participate in a church plan, and the rules dealing with
have the potential for
asset pooling and self-annuitization,
clarifying or simplifying the application of certain provisions applicable to church plans, and we are willing to
work with the staff to develop these more fully.

-25Administration
The

Position

Administration

opposes the proposal,

technical changes that clarify current
to church plans. Specifically,

apply

except for

law or make

it

simpler

to

believe the proposed exemption from the trust and
nondiscrimination
for most qualified church
requirements
retirement plans and tax-sheltered annuities is not justified
structures or polity,
by differences in church organizational
or other unique attributes of churches or church plans.
Church employees are entitled to the same safeguards as
employees of other organizations,
regardless of their
employer's internal administration.
We have similar
reservations about most of the the other new special rules
for church plans in the proposal. The proposed amnesty for
such plans for plan years beginning prior to January 1, 1990,
is contrary to our general policy against retroactive relief

We

obligations.
2. We oppose the extension of the special rules currently
applicable only to QCCOs to all church-controlled or affiliated organizations (other than hospitals and universities) to
which the special qualified church retirement plan rules now
to provide special
apply, because it is inappropriate
treatment reserved generally for churches to organizations
that function more as secular charities or commercial
enterprises.
We are, however,
sensitive to problems that
exist in applying the QCCO definition, particularly the
source-of-income rules, and would be willing to work with the
staff to develop a simplified definition.
from

3.

4.

prior compliance

oppose the consolidation of the special rules applicable
to qualified church retirement plans in one section of the
Code. We believe that the current statutory approach of
exempting church plans from certain provisions that are
difficult to apply or inappropriate in the church plan
context is the right approach, because it applies to the
extent possible the same retirement policy for all employers
and employees, and does not tend to perpetuate
and enhance
differences between the treatment of church and other plans.

We

of the technical items in the proposal, e. cr. , the
clarification of the ability of self-employed ministers to
participate in a church plan, and the rules dealing with
have the potential for
asset pooling and self-annuitization,
clarifying or simplifying the application of certain provisions applicable to church plans, and we are willing to
work with the staff to develop these more fully.
Some

-26CONCLUSION

to work with the Subcommittee to
Ne welcome the opportunity
achieve meaningful simplification of the employee benefit provisions of the Code. S. 2901 contains a number of provisions which
merit careful consideration in achieving this goal. I must end
Administration's
final judgment on
where I began, however--the
these proposals must be postponed until the revenue effects of
the proposal are evaluated in the context of a final legislative
package.

-0-

-26CONCLUSION

the opportunity to work with the Subcommittee to
We welcome
achieve meaningful simplification of the employee benefit provisions of the Code. S. 2901 contains a number of provisions which
merit careful consideration in achieving this goal. I must end
final judgment on
where I began, however ——the Administration's
these proposals must be postponed until the revenue effects of
the proposal are evaluated in the context of a final legislative
package.

-0-

portment of the Treasury

.

FOR IMMEDIATE

&&

n. c. N Telenhone see-eoeg

r

~ ihfclra4sineton,

O~». 0F T, I

August

f)

IE

f 'J I

RELEASE

j

CONTACT:

6, 1990

TREASURY AUGUST QUARTERLY

Art Siddon
202/566-5252

FINANCING

SCHEDULE

that Congressional action to increase
the debt limit permits the Treasury to proceed with the auctions
of 3-year. notes on August 7, 10-year notes on August 8, and 30The Treasury

announced

year bonds and 36-day cash management

these issues will settle

NB-908

on August

bills

on August

15, 1990.

9.

All of

i

i

n. c. a Telephone sss-so4'I

~portment of the Treasury ~ lkclrehlnaton,
DLP

j 0:- Tll P jjG pg,ling'j'''
~

FOR IMMEDIATE

August

RELEASE

CONTACT:

6, 1990

TREASURY AUGUST

QUARTERLY

Art Siddon
202/566-5252

FINANCING

SCHEDULE

that Congressional action to increase
the debt limit permits the Treasury to proceed with the auctions
of 3-year, notes on August 7, 10-year notes on August 8, and 30The Treasury

announced

year bonds and 36-day cash management

these issues will settle

NB-908

on August

bills

on August

15, 1990.

9

All of

ggi,

h

'

epos~en&

o&

&he/jI'ejnpp+, $ wash1niton,

FOR IMMEDIATE

RELEASE

3, 1990

August

THE TREASURY DEPARTMENT

1.

3. 0

Contact:

p. c. I Telephone 565-204

Barbara Clay, 566-2041
Cheryl Crispen, 566-5252

TODAY ANNOUNCED

OIL

THE FOLLONING

CONTRACTS ENTERED INTO PRIOR TO AUGUST
ENROUTE TO THE UNITED STATES

2

ACTIONS:

1990

AND

Importation of Iraqi and Kuwaiti oil will be permitted where
(1) the oil was loaded prior to the effective date (5:01 a. m.
Eastern Daylight Time (EDT), August 2, 1990), was intended for
ultimate delivery to the United States, and was imported into the
United States before ll:59 p. m. EDT, October 1, 1990; (2) the
Bill of Lading was issued prior to the effective date; (3) any
balance not yet paid to Iraq or Kuwait for the shipment must be
paid into a blocked account in the United States; and (4) such
transaction is reported to the Blocked Assets Section, Office of
Foreign Assets Control.

2.

TRANSACTIONS. OF KUWAITI-CONTROLLED

U. S. FIRMS

general license will be issued authorizing U. S. financial
institutions to accept deposits and clear checks written on the
firms in the United
blocked accounts of Kuwaiti-controlled
States, and in general to operate such firms' blocked bank
accounts, provided that no benefit to the Government of Iraq
arises from transactions in the blocked accounts. In order to
utilize the general license, Kuwaiti-controlled firms will be
required to register with the Office of Foreign Assets Control's
Blocked Assets Section. Financial institutions holding such
firms' accounts will be required to verify that registration had
occurred. This will facilitate the normal day-to-day financial
functions of Kuwaiti firms in the United States and permit
payment of employees and creditors and the purchase of goods and
services in the ordinary course of the firms' business. A

NB-909

lepartment

of theivfeapp~.

y

D~~T. 0F THE rHEg„=g, -,

FOR IMMEDIATE

RELEASE

3, 1990

August

THE TREASURY DEPARTMENT

1.

a.c. I

washington,

Telephone hei-go4l

-,

Contact:

Barbara Clay, 566-2041
Crispen, 566-5252

Cheryl

TODAY ANNOUNCED

OIL

THE FOLLOWING

CONTRACTS ENTERED INTO PRIOR TO AUGUST
ENROUTE TO THE UNITED STATES

2

ACTIONS:

1990

AND

Importation of Iraqi and Kuwaiti oil will be permitted where
(1) the oil was loaded prior to the effective date (5:01 a. m.
Eastern Daylight Time (EDT), August 2, 1990), was intended for
ultimate delivery to the United States, and was imported into the
United States before 11:59 p. m. EDT, October 1, 1990; (2) the
Bill of Lading was issued prior to the effective date; (3) any
balance not yet paid to Iraq or Kuwait for the shipment must be
paid into a blocked account in the United States; and (4) such
transaction is reported to the Blocked Assets Section, Office of
Foreign Assets Control.

2.

TRANSACTIONS

OF KUWAITI-CONTROLLED

U. S. FIRMS

license will be issued authorizing U. S. financial
institutions to accept deposits and clear checks written on the
firms in the United
blocked accounts of Kuwaiti-controlled
States, and in general to operate such firms' blocked bank
accounts, provided that no benefit to the Government of Iraq
arises from transactions in the blocked accounts. In order to
utilize the general license, Kuwaiti-controlled firms will be
required to register with the Office of Foreign Assets Control's
Blocked Assets Section. Financial institutions holding such
firms' accounts will be required to verify that registration had
occurred. This will facilitate the normal day-to-day financial
functions of Kuwaiti firms in the United States and permit
payment of employees and creditors and the purchase of goods and
services in the ordinary course of the firms business. A

general

NB-909

3.

REINVESTMENT

AUTHORITY

In the management of portfolio investments and securities blocked
to Executive Order 12723 representing interests of the
companies will be
Government of Kuwait, bank and investment
authorized to manage such blocked property and to reinvest the
proceeds of such property in assets subject to the jurisdiction
in the United States, provided that no investment results in an
otherwise prohibited transfer of financial or economic benefit to
the Government of Iraq. Prior to engaging in any transaction
pursuant to this general license, the U. S. person must register
with the Blocked Assets Section, Office of Foreign Assets
Control, and provide regular reports as directed concerning such

pursuant

transactions.
4. COMPLETION

OF FOREIGN EXCHANGE

CONTRACTS

entered into for the account of the
of Kuwait prior to 5:00 a. m. EDT, August 2, 1990, may
be completed, provided:
(1) all exchange transactions are
completed prior to August 16, 1990; (2) funds are received in the
U. S. prior to payment; and (3) all payments received for the
account of the Government of Kuwait go into a blocked account.
Foreign exchange contracts

Government

The Treasury

Department

expects to issue regulations

shortly.

3.

REINVESTMENT

AUTHORITY

In the management of portfolio investments and securities blocked
pursuant to Executive Order 12723 representing interests of the
Government of Kuwait, bank and investment companies will be
authorized to manage such blocked property and to reinvest the
proceeds of such property in assets subject to the jurisdiction
in the United States, provided that no investment results in an
otherwise prohibited transfer of financial or economic benefit to
the Government of Iraq. Prior to engaging in any transaction
pursuant to this general license, the U. S. person must register
with the Blocked Assets Section, Office of Foreign Assets
Control, and provide regular reports as directed concerning such

transactions.
4. COMPLETION

OF FOREIGN EXCHANGE

CONTRACTS

entered into for the account of the
of Kuwait prior to 5:00 a. m. EDT, August 2, 1990, may
be completed, provided:
(1) all exchange transactions are
completed prior to August 16, 1990; (2) funds are received in the
U. S. prior to payment; and (3) all payments received for the
account of the Government of Kuwait go into a blocked account.
Foreign exchange contracts

Government

The Treasury

Department

expects to issue regulations

shortly

yghSVp

~ ~

e

Department

of the Treasury

~

Bureau of the Public Debt

FOR RELEASE AT 3:OO PM

~ Washington,

DC 20239

Contact: Peter Hollenbach
(202) 376-4302

August 6, 1990

PUBLIC DEBT ANNOUNCES ACTIVITY FOR
SECURITIES IN THE STRIPS PROGRAM FOR JULY 1990
Treasury's Bureau of the Public Debt announced activity figures for the month of July 1990, of
securities within the Separate Trading of Registered Interest and Principal of Securities program,

(STRIPS).
Dollar Amounts in Thousands

$429, 520, 696

Principal Outstanding
(Eligible Securities)

Held in Unstripped

$325,342, 356

Form

$104, 178,340

Held in Stripped Form

Reconstituted

$3,461,640

in July

The accompanying table gives a breakdown of STRIPS activity by individual loan description.
The balances in this table are subject to audit and subsequent revision. These monthly figures are
included in Table VI of the Monthl Statement of the Public Debt, entitled "Holdings of Treasury
Securities in Stripped Form. " These can also be obtained through a recorded message on
(202) 447-9873.

oOo

gghSQp

~ ~

e

)epartment of the Treasury

~

Bureau of the Public Debt

FOR RELEASE AT 3:OO PM

~ Washington,

DC 20239

A~
IC

Contact: Peter Hollenbach
(202) 376-4302

August 6, 1990

PUBLIC DEBT ANNOUNCES ACTIVITY FOR
SECURITIES IN THE STRIPS PROGRAM FOR JULY 1990
Treasury's Bureau of the Public Debt announced activity figures for the month of July 1990, of
securities within the Separate Trading of Registered Interest and Principal of Securities program,

(STRIPS).
Dollar Amounts in Thousands

$429, 520, 696

Principal Outstanding
(Eligible Securities)

Held in Unstripped

$325,342, 356

Form

$104, 178,340

Held in Stripped Form

Reconstituted

$3,461,640

in July

The accompanying table gives a breakdown of STRIPS activity by individual loan description.
The balances in this table are subject to audit and subsequent revision. These monthly figures are
included in Table VI of the Monthl Statement of the Public Debt, entitled "Holdings of Treasury
"
Securities in Stripped Form. These can also be obtained through a recorded message on
(202) 447-9873.

oOo

PA-22

~

TABEL VI

-

OF TREASURY

HOLDINGS

SECURITIES IN STRIPPED FORH, JULY

31, 1990

( IN THOUSANDS)
I

PRINCIPAL

I

AHOUNT

OUTSTANDING

I
I
I

PORTIOH

I

11-5/BL

11-1/4L

NOTE

C-1994

NOTE

A-1995

11-1/4L

NOTE

8-1995

10-1/2L

NOTE

C-1995

9-1/2L

NATURITY

DESCRIPTION

LOAH

NOTE

I

8-7/BL

NOTE

A-1996

7-3/SL

NOTE

C-1996

5/15/95

7, 127, 086

1, 627, 520

80, 000

8/15/95

7, 955, 901

7, 325, 901

630, 000

20, 000

11/15/95

7, 318, 550

0

2/15/96

8, 575, 199

I

5/15/96

20, 085, 643

6, 476, 150
8, 322, 399
19, 864, 843

842, 400

I

11/15/96

20, 258, 810

i9, 958, SIO
9, 849, 637

300, 000

I
I

I
I
I

I

I

8-5/BL

8-1997

I

NOTE

8-7/BL

C-1997

I

HOTE

8-1/SL

A-1998

I

HOTE

I

9, 362, 836

0

9, 792, 329
9, 158, 428
9, 135, 387

16, 000

30, 000

11, 214, 646

128, 000

9, 902, 875
9, 719, 628

9, 896, 475
9, 716, 428

6, 400

2/15/99

5/i5/99

10, 047, 103

9, 178, 303

868, 800

8/15/99

10, 163, 644

10, 081, 644

82, 000

1

11/15/99

10, 773, 960

10, 769, 160

4, 800

I

2/15/00

10., 673, 033

10, 673, 033

5/15/00

10, 496, ?30

10, 496, 230

0

ii/i5/04

8, 301, 8Q6

3, 669, 806

4,

632, 00Q

40, 000

4, 260, 758

1, 830, 058

9, 269, 713

8, 424, 913

2, 430, 700
844, 800

131,200

4, 755, 916

4, 755, 916

0

6, 005, 584

1, 779, 184

4, 226, 400

92, 800

12, 667, 799

2, 496, 439
2, 075, 996
2, 016, 659

10, 171, 360

216, 640

5, 073, 920

78, 720

I, &2', 800
1, 816, 0u0

20, 800

6, 657 680
11,630, 240

845, 6QQ

4, 982, 400

56, 000

5, 273, 600
7, 362, 600

76, 600

13, 256, 000

382, 400
462, 080

2/15/98

5/15/98

I

8-7/BL

I

HOTE

D-1998

8-7/8'L

HOTE

A-1999

9-1/BL

NOTE

8-1999

12L

I

I

I
I
I
I
I

BOHD

I

BOND

20Q9-14

11-1/4'L

BOHD

2015

10-5/8'L

BOND

2015
2015

9-1/4L

BONO

2016

T-i/4L

BOHD

2016

7-1/2L

BOHD

2016

8-3/4L

BOND

2017

8-7/BL

BOND

2017

9-1/BL

BONO

2018

I

BOHD

I

I

BOHD

2019

8-1/2L

BOND

2020

8-3/4L

BOHD

I

I
I

I

I

7, 149, 916
6, 899, 859

2/15/16

I

7, 266, 854

6, 142, 054

5/15/16

I

17, 007, 551

I

18, 823, 551
18, 864, 448

I

i8, 194, 169

I
I

11/15/15

I
I
I

I
I

I
I

I
I

I
I
I
t

11/15/16
8/15/17

I

5/15/18

I

I

I

IT/t5/18

I

2/15/19

I
I

I
I

I

5/15/17

I

I

2020

I

8/15/15

I

I

8-1/SL

I

2/15/15

I

2019

I

11/15/14

I

2018

BONO

t

2/15/06

I

11-3/4L

BONO

8/i5/05

I

2006

9-7/BL

5/15/05

I

2005

BOHO

9-3/BL

8-T/BL

I

2005

BOND

IQ-3/4L

9L

I

2004

SOHO

11/15/98

I

I

8-2000

11-5/SL

8/15/98

I

I

HOTE

0

9, 362, 836
9, 808, 329
9, 159, 068
9, 165, 387
11, 342, 646

11/15/97

C-1998

8-7/SL

220, 800

8/15/97

NOTE

A-2000

252, 800

9, 921, 237

I

NOTE

'

5/15/97

I

8-1/2'L

1

8, 000

A-1997

0-1999

HOHTH

$206, 400

D-1996

HOTE

THIS

508, 480

NOTE

7-7/BL

RECONSTITUTED

',

$1, 268, 800

HOTE

8X NOTE

',

6, 425, 381
5, 499, 566

I

C-1999

IH

FORH

$5, 389, 754

8-1/2L

9-1/4L

HELD

STRIPPED

6, 933, S61

I

8-1998

PORTION

FORN

$6, 658, 554

11/15/94

I

7-1/4L

9L NOTE

IN

2/15/95

I

D-1995

UNSTRIPPED

TOTAL

DATE

HELD

I
I
I

8/15/19
2/15/20

I
I

5/15/20

I

71, 600

640

3, 200
0

0

12, 206, 768

6, 563, 929
9, 034, 458

14, 016, 858

0

8, 708, 639
9, 032, 870

3, 435, 039

'19, 250, 793

20, 213, 832

5, 994, 793
12, 289, 672

10, 228, 868

5, 549, 668

7, 924, 160
4, 679, 200

10, 158, 883

9, 811, 843

347, 040

429, 520, 696

325, 342, 356

104, 178, 340

1, 670, 270

37, 600
27, 20Q
73, 600

606, 000

I

TOTAL

1

Effective

Note:

On

Hay

I, 1987, securities

the 4th workday

is (202) 447-9873,

held

in

stripped

of each aonth a recording

The be)ance@in

fora were eligible for reconstitution

of Table VI will
this table are subject to audit

be
and

available
subsequent

to their unstripped

after 3:00 pa.
adjustaents.

The

telephone

3, 461, 640

fora.
nuaber

TASEL VI

-

HOLDIHGS

OF TREASURY

SECURITIES IH STRIPPED FORM, JULY

31, 199Q

( IN THOUSANDS)
PRINCIPAL

PORTION
HATURITY

DESCRIPTIOH

LOAN

11-5/BX
11-1/4'X

NOTE

C-1994

NOTE

A-1995

11-1/4X

HOTE

8-1995

10-1/2X

NOTE

C-1995

9-1/2X

MOTE

D-1995

8-7/BX

NOTE

A-1996

7-3/SX

MOTE

C-1996

I

I
I

I

I
I
I
I

I

MOTE

0-1996

8-1/2X

NOTE

A-1997

8-5/BX

I

NOTE

8-1997

8-7/BX

C-1997

I

NOTE

8-1/BX

A-1998

I

MOTE

I
I
I

8-1998
I

8-7/SX

D-1998

I

MOTE

8-7/BX

MOTE

A-1999

9-1/BX

MOTE

8-1999

I

I
I
I
I
I

C-1999

BX MOTE

7-7/BX

HOTE

0-1999

8-1/2X

A-2000

1

HOTE

B-2000

I

8-7/BX

HOTE

11-5/BX
12X

I
I
I

BOHD

I

I

2005

SOHO

I
I

2006

I

11-3/4X

BOND

2009-14

11-1/4X

BOHO

2015

10-5/BX

SOHD

2015

9-7/BX

I

2005

BOHD

9-3/SX

1

2004

BOHD

10-3/4X

I

BONO

I
I
I
I
I
I

2015

9-1/4X

SOHO

2016

7-1/4X

BONO

2016

7-1/2X

BQHD

2016

I
I

I
I

I
I

I

8-3/4X

BOHD

2017

8-7/BX

2017

I

BONO

9-1/SX

2018

I

BQHQ

I
I

I

I

2018

9X SOHO

I

8-7/SX

BOND

2019

8-1/SX

BOND

2019

8-1/2X

SQHD

2020

8-3/4X

SOHO

2020

I
I
I
I
I
I
I

7, 127, 086
7, 955, 901
7, 318, 550

Effective

Note:

On

Hay

the 4th workday
The

80, 000

630, 000

20, 000

842, 400

8, 575, 199

8, 322, 399

252, 800

5/15/96

20, 085, 643

19, 864, 843

220, 800

11/15/96

20, 258, 810

19, 958, 810

300, 0QQ

5/15/97

9, 921, 237
9, 362, 836
9, 808, 329
9, 159, 068
9, 165, 387
11, 342, 646

9, 849, 637

71, 600

9, 362, 836

0

9, 792, 329
9, 158, 428

16, 000
640

9, 135, 387
11, 214, 646

30, 000

0

128, 000

0

6, 400
3, 200

0

11/15/98

9, 902, 875

2/15/99

9, T19, 628

9, 896, 475
9, 716, 428

5/15/99

10, 047, 103

9, 178, 303

868, 800

8/15/99

10, 163, 644

10, 081, 644

82, 00Q

11/15/99

10, 773, 960

10, 769, 160

4, 800

2/15/00

10, 673, 033

10, 673, 033

0

5/15/00

10, 496, 230

10, 496, 230

11/15/04

8, 301, 806

5/15/05

4, 260, 758

3, 669, 806
1, 830, 058

2, 430, 700

0

8/15/05

9, 269, 713

8, 424, 913

844, 800

131,200

2/15/06

4, 755, 916

4, 755, 916

0

0

40, 000

4, 632, 000

6, 005, 584

1, 779, 184

4, 226, 400

92, 800

2/15/15

12, 667, 799

2, 496, 439

10, 171, 360

216, 640

8/15/15

7, 149, 916
6, 899, 859

2, 075, 996

5, 073, 920

78, 720

2, Q16, 659
6, 142, 054
17, 007, 551

2/15/16

7, 266, 854

5/15/16

18, 823, 551
18, 864, 448

12, 206, 768

8/15/17

18, 194, 169
14, 016, 858

5/15/18

11/15/16
5/15/17

1Tty5/18

27, 200

4, 982, 400

56, 000

8, 708, 639

3, 435, 039

5, 273, 600

73, 600

1, 670, 270

7, 362, 600

76, 600

5, 994, 793
12, 289, 672

13, 256, 000

382, 400

7, 924, 160
4, 679, 200

462, 080

347, 040

0

104, 178, 340

3, 461, 640

10, 228, 868

10, 158, 883

5, 549, 668
9, 811, 843

429, 520, 696

325, 342, 356

of each aonth a recording
balanceain

37, 600

11,630, 240

5/15/20

stripped

20, 800

6, 563, 929
9, 034, 458

8/15/19

in

i, i2,', 800

845, 60D

2/15/20

held

0

1, 816, 0uQ
6, 657 680

9, 032, 870
19, 250, 793
20, 213, 832

2/15/19

1, 1987, securities

is (202) 447-9873.

1, 627, 520

7, 325, 901
6, 476, 150

2/15/96

TOTAL

1

1

5/15/95

11/15/15

1

MONTH

8, 000

11/15/14

I

THIS

$206, 400

8/15/98

I

RECONSTITUTED

',

508, 480

5/15/98

C-1998

FORM

',

$1, 268, 800

2/15/98

HOTE

STRIPPED

IN

6, 425, 381
5, 499, 566

11/15/97

9-1/4X

HELD

$5, 389, 754

8/15/97

I

FORM

PORTION

6, 933, 861

11/15/95

I

UNSTRIPPED

IN

$6, 658, 554

8/15/95

I

HELD

2/15/95

11/15/94

I

7-1/4X

9'X HOTE

TOTAL

DATE

OUTSTANDING

AMOUNT

fora were eligible

of Table VI will
this table are subject to audit

be
and

for reconstitution
available
subsequent

to their unstripped

after 3:00 pu.
adjustients.

The

telephone

606, 000

fora.
number

ap
/',

l/Jg

epattment of the Treasury

g

~ Washln

l,-pp

'

) kk j p.C. ~

'F:,-, ..

j,

Telephone SSS-204l

CONTACT:

o jf

Of f ice o f

Financing
202/376-4350

e&

FOR IMMEDIATE

August

RELEASE

6, l990

for $9, 212 million of 13-week bills and for $9, 204 million
vere accepted today.
both to be issued on August 9. 1990

Tenders

of 26-veek

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

bills,

OF ACCEPTED
COMPETITIVE BIDS:

RANGE

13-week bills
November 8, 1990
maturin
Investment
Discount
Rate
Rate 1/
Price

26-week bills
February 7, 1991
Discount
Investment
Price
Rate 1/
Rate

maturin

7. 16% '/
98. 177
High
7. 21%
98. 170
Average
7. 19%
98. 172
a/ Excepting $690, 000 at lower yields.
Tenders at the high discount rate for the 13-veek bills
Tenders at the high discount rate for the 26-week bills
e
7. 21%
7. 24%
7. 23%

Low

7. 53%
7. 59%v
7. 56%

7. 45%
7. 48%
7.47%

96. 380
96. 355
96. 365

allotted 16%.
allotted 44%.

were
were

TENDERS RECEIVED AND ACCEPTED

(In Thousands)
Location

Received

Boston
New York

$17, 457, 170
1, 400, 300
$18, 857, 470
2, 300, 000

$5, 027, 370
1, 400, 300
$6, 427, 670
2, 300, 000

156, 800
$27, 901, 230

156, 800

476, 200
$21, 633, 670

476, 200
$9, 203, 870

35, 905

1, 615, 295
23. 325
9, 695

~Te
Competitive
Noncompetitive

Subtotal,

Public

Federal Reserve
Foreign Official

Institutions
TOTALS

1/ Equivalent

ted

$5, 228, 050
1, 604, 465
$6, 832, 515
2, 222, 315

Atlanta

TOTALS

~Acce

$23, 917, 650
1, 604, 465
$25, 522, 115
2, 222, 315

Richmond

Treasury

Received

$9, 211, 630

21, 880
51, 400
65, 075

Cleveland

$

50, 375
7, 705, 760
21, 880
51, 400
63, 395
35, 065
84, 895
19, 645
9, 695

:

699, 465
$21, 633, 670

50, 375
24, 296, 560

Philadelphia

Dallas
San Francisco

ted

34, 920
7, 533, 105
16, 150
42, 320
51, 555
30, 405
477, 235
23, 810
21, 065
55, 715
26, 590
191,533
699, 465
$9, 203, 870

$

Chicago
St. Louis
Minneapolis
Kansas City

~Acce

44, 330
35, 060
948, 960
703, 370

44, 330
25, 860
395, 960
703, 370

$27, 901, 230

coupon-issue

yield.

$9, 211, 630

$

34, 920
17, 982, 105
16, 150
42, 320

51, 555
30, 405

1, 902, 235
23, 810

21, 065
55, 715
29, 390
744, 535

$

Bp
i

j', )
the Treosory ~ Washln
I/Jg

sportnleni of

t

) Nkvd

p. C.

~

Telephone SSS-2441

CONTACT:
FOR IMMEDIATE

August

Tenders

202//376-4350

RELEASE

6, 1990

of 26-week

Office of Financing

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

for $9, 212 million of 13-week bills and for $9, 204 million
were accepted today.
both to be issued on August 9, 1990

bills,

OF ACCEPTED
COMPETITIVE BIDS:

13-week

RANGE

maturin
Discount
Rate

bills

November

26-week bills
February 7, 1991
maturin
Discount
Investment
Price
Rate
Rate 1/

8, 1990

Investment
Rate 1/

Price

7. 16% '/
98. 177
High
7. 21%
98. 170
Average
7. 19%
98. 172
a/ Excepting $690, 000 at lower yields.
Tenders at the high discount rate for the 13-week bills
Tenders at the high discount rate for the 26-week bills
4
7. 21%
7. 24%
7. 23%

Low

7. 45%
7. 48%
7.47%

7. 53%
7. 59%
7. 56%

96. 380
96. 355
96. 365

allotted 16%.
allotted 44%.

were
were

TENDERS RECEIVED AND ACCEPTED

(In Thousands)
Location

Received

Boston
New

$

York

Philadelphia

50, 375
24, 296, 560

21, 880
51, 400

Cleveland

65, 075
35, 905
1, 615, 295

Richmond

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

23. 325
9, 695

Dallas
San Francisco
Treasury
TOTALS

~Te
Competitive
Noncompetitive

Subtotal, Public
Federal Reserve
Foreign Official

Institutibns
TOTALS

1/ Equivalent

ol

n

~Acce
$

ted

50, 375
7, 705, 760
21, 880

51, 400
63, 395
35, 065

84, 895
19, 645

9, 695

:

Received
$

34, 920
17, 982, 105
16, 150
42, 320

51, 555
30, 405

1, 902, 235
23, 810
21, 065
55, 715'
29, 390

~Acce

ted

34, 920
7, 533, 105
16, 150
42, 320
51, 555
30, 405
477, 235
23, 810
21, 065
55, 715
26, 590
191,533
699, 465
$9, 203, 870
$

44, 330
35, 060
948, 960
703, 370

44, 330
25, 860
395, 960
703, 370

$27, 901, 230

$9, 211, 630

699, 465
$21, 633, 670

$23, 917, 650
1, 604, 465
$25, 522, ]. 15
2, 222, 315

$5, 228, 050
1, 604, 465
$6, 832, 515
2, 222, 315

$17, 457, 170
1, 400, 300
$18, 857, 47Q
2, 300, QQQ

$5, 027, 370
1, 400, 300

156, 800
$27, 901, 230

156, 800

476, 200

$9, 211, 630

$21, 633, 670

476, 200
$9, 203, 870

coupon-issue

yield.

744, 535

$6 427 67Q

2, 300, 000

I

CmpclraNlent

of t tie

U

TI eclsury ~ Nasl1llng

IMMEDIATE RELEASE;"
7g 1990

August

]„- -.

I,', ,-,

„,

RESULTS OF AUCTION

ton, O.C.
CONTACT:

~

Teleptlone 586-24

Office of Financing
202/376-4350

OF 3-YEAR NOTES

of the Treasury has accepted $11, 533 million
of $27, 514 million of tenders received from the public for the
3-year notes, Series U-1993, auctioned today. . The notes will be
issued August 15, 1990, and mature August 15, 1993.
The interest rate on the notes will be 8 -:.
The range
of accepted competitive bids, and the corresponding prices at the
8 -:
rate are as follows:
Yield
Price
99. 791
Low
8. 08-'o*
10%
99.
738
8.
High
10-'o
8.
99 738
Average
* Excepting $5, 000 at lower yields.
Tenders at the high yield were allotted 94:.
The Department

TENDERS RECEIVED AND ACCEPTED

Location
Boston
New

York

Philadelphia
Cleveland
Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas

San Francisco

Treasury

Totals

Received
30 , 080
253
25,
, 920
22 , 230
49 , 995
108 . 505

34 , 010
1, 191 , 375'
55 , 730

33 , 065
89 , 935
17 , 995
542 , 780
84 , 720
$27, 514, 340

(In Thousands)
080
$30
780
10,
,

527 ,

22 , 230

49 , 995
84 , 285
33 , 710
380 , 715
47 , 730
33 , 065
89 , 935
16 . 935

132 , 200
84 , 720
$11, 533, 380

The $11, 533 million of accepted tenders includes $973
million of noncompetitive tenders and $1Q, 56Q million of competitive tenders from the public.

to the $11, 533 million of tenders accepted in
the auction process, $1, 385 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
An additional
international monetary authorities.
$2, 518 million
of tenders was also accepted at the average price from Federal
Reserve Banks for their own account in exchange for maturing
In addition

securities.

LI g

eParement of the TI'asllFV
FOR IMMEDIATE

August

~

sC

Nashlngton,

RELEASE-,:--~-;, --, z,

7, 1990

.

CONTACT:

,

C. ~ Telephone SQ5 24$
Office of Financing
202/376-4350

OF 3-YEAR NOTES

RESULTS OF AUCTION

The Department of the Treasury has accepted $11, 533 million
of $27. 514 million of tenders received from the public for the
3-year notes, Series U-1993, auctioned today. The notes will be
issued August 15, 1990, and mature August 15, 1993.
The interest rate on the notes will be 8 -o.
The range
of accepted competitive bids, and the corresponding prices at the
8
rate are as follows:
Yield
Price
,

-o

Low

High

Average

8. 08-'o*
8. 10-'o
8. 10%

99 ' 791
99. 738

* Excepting $5, 000 at lower yields.
Tenders at the high yield were allotted
TENDERS RECEIVED AND ACCEPTED

Location
Boston
New

York

Philadelphia
Cleveland
Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas

San Francisco

Treasury

Totals

99-738
94-. .

(In Thousands)

Received

$30
25,

080
253 , 920
22 , 230
49 , 995
108 , 505
,

34 , 010

1, 191 , 375'
55 . 730

33 , 065
89 , 935
17 , 995
542 , 780
84 , 720
$27, 514, 340

30 , 080
10. 527 , 780
22 , 230
49 , 995
84 , 285
33 , 710
380 , 715
47 , 730
33 . 065
89 , 935
16 , 935
132 , 200
84 , 720

$11, 533, 380

$11, 533 million of accepted tenders includes $973
million of noncompetitive tenders and $10, 560 million of competitive tenders from the public.
In addition to the $11, 533 million of tenders accepted in
the auction process, $1, 385 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
international monetary authorities.
An additional
$2, 518 million
of tenders was also accepted at the average price from Federal
Reserve Banks for their own account in exchange for maturing
securities.
The

f'

4'~e4

".":

~ f( ~ 4'4
f

f

~

&

A

L"'

epartment of the Treasury

~ Washinoton,

Toe' :
DEi','. 0F' I'~
'-T~"E~,
I

i;-,

,

D.C. ~ Telephone 566-2O
CONTACT:

Office of Financing
202/376-4350

FOR RELEASE AT

7, 1990

August

4:00 P. M.
TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
for two series of'Treasury bills totaling approximately
This offering
to be issued August 16, 1990.
S 18.400 million,

tenders

will provide about $2, 250 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of $16, 139 million.
Tenders will be received at Federal Reserve Banks and Branches and
at the Bureau of the Public Debt, Washington, D. C. 20239, prior to
1:00 p. m. , Eastern Daylight Saving time, Monday, August 13, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
and to mature
May 17, 1990,
November 15, 1990 (CUSIP No.
912794 VJ 0), currently outstanding in the amount of S 8, 463 million,
the additional and original bills to be freely interchangeable.

bills (to maturity date) for approximately $9, 200
representing an additional amount of bills dated
February 15, 1990, and to mature
February 14, 1991 (CUSIP No.
912794 VV 3), currently outstanding in the amount of $9, 594 million,
the additional and original bills to be freely interchangeable.
182-day

million,

The bills will be issued on a discount
and noncompetitive
bidding, and at maturity

basis under competitive
their par amount will
be payable without interest.
Both series of bills will be issued
entirely in book-entry form in a minimum amount of $10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury
Tenders from Federal Reserve
bills maturing August 16, 1990.
for
their
own
Banks
account and as agents for foreign and international monetary authorities will be accepted at the weighted
average bank discount rates of accepted competitive tenders.
Additional amounts of the bills may be issued to Federal Reserve Banks,
as agents for foreign and international monetary authorities, to
the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
million as agents for foreign
Reserve Banks currently hold S632
and $4, 733 million for their
international
monetary
authorities,
and
Tenders for bills to be maintained on the hook-entry
own account.
records of the Department of the Treasury should be submitted on Form
PD 5176-1 (for 13-week series) or Form PD 5176-2 (for 26-week series).

,3
!A

of the Treasury

department

~ Washington,
'0"!'I.iiF Tj'F»&;, ' ~,
-

.

D.C. ~ Telephone 566-2O41
CONTACT: Office of Financing
202/376-4350

FOR RELEASE AT

7, 1990

August

4:00 P. M.
TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
for two series of'Treasury bills totaling approximately
$18.400 million, to be issued August 16, 1990.
This offering

tenders

will provide about $2, 250 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of $16, 139 million.
Tenders will be received at Federal Reserve Banks and Branches and
at the Bureau of the Public Debt, Washington, D. C. 20239 prior to
1:00 p. m. , Eastern Daylight Saving time, Monday, August 13, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
and to mature
May 17, 1990,
November 15, 1990 (CUSIP No912794 VJ 0), currently outstanding in the amount of $8, 463 million,
the additional and original bills to be freely interchangeable.

bills (to maturity date) for approximately $9, 200
representing an additional amount of bills dated
February 15, 1990, and to mature
February 14, 1991 (CUSIP No.
912794 VV 3), currently outstanding in the amount of $9, 594 million,
the additional and original bills to be freely interchangeable.
182-day

million,

bills will

basis under competitive
-and noncompetitive
bidding, and at maturity their par amount will
be payable without interest.
Both series of bills will be issued
entirely in book-entry form in a minimum amount of $10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury
Tenders from Federal Reserve
bills maturing August 16. 1990.
Banks for their own account and as agents for foreign and international monetary authorities will be accepted at the weighted
average bank discount rates of accepted competitive tenders.
Additional amounts of the bills may be issued to Federal Reserve Banks,
as agents for foreign and international monetary authorities, to
the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
million as agents for foreign
Reserve Banks currently hold $632
and $4, 733 million for their
monetary authorities,
and international
Tenders for bill's to be maintained on the book-entry
own account.
records of the Department of the Treasury should be submitted on Form
PD 5176-1 (for 13-week series) or Form PD 5176-2 (for 26-week series).
The

be issued on a discount

TREASURY'S

13-, 26-,

Each tender must

AND

52-WEEK BILL OFFERINGS,

state the par

amount

Page

2

of bills bid for,

which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.
bidder, as defined in Treasury s single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets. in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government secu-

rities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position
exceeds $200 million.

in the

bill

being offered

A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury s single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets. in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
Others are only permitted to submit tenders for their
furnished.
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full
must accompany all tenders
on the book-entry records

bills applied for
for bills to be maintained

par amount of the
submitted

of the

of the Treasury.
will be made on all accepted tenders for the
difference between the par payment submitted and the actual
issue price as determined in the auction.

A

cash adjustment

Department

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, 'e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments

will be

for differences

between the par value
in exchange and the issue

bills accepted
bills.
If a bill is purchased at issue,

maturing
new

made

of the
price of the

is

held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
and

of the Treasury Circulars, Public Debt Series
Nos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

TREASURY ' S

13-, 2 6-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept, or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Treasury

Settlement for accepted tenders for bills to be maintained
on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.

If a bill is purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
Department of the Treasury Circulars, Public Debt Series
Nos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of

the Public Debt.
8/89

~

e~

~

~

~

I

Department

nf the Treasury

~

A

Bureau of' the Public Debt

FOR IM MEDIATE RELEASE

~ Washington,

DC 20239

CONTACT; Office of. Financing
(202) 376-4350

August 8, 1990

TREASURY TO ISSUE RESULTS OF TODAY' S
10-YEAR NOTE AND 30-YEAR BOND AUCl &ONS BY 2:30 P. M.

The Treasury has announced

that in its continuing

effort to release results of auctions

more quickly, it intends to publish the auction results for long-term

EDST. This 2:30 p. m. release time
with tomorrow's

will begin with today's

securities by 2:30 p. m. ,

10-year note auction and continue

30-year bond offering.

At thts time, the 2.'30 p. m. release will only apply to 10-year notes and 30-year bonds,

The Treasury is continuing to examine methods to release all auction results earlier.

o0o

PA-23

Crc O+

«

~

~

~

«

~

««

Department

nf the

Treasu+

~

BUreau ot the Publi& Debt

FOR IM MEDIATE RELEASE

~ Washington,

DC 20239

CONTACT: Office of Financing
(202) 376-4350

August 8, 1990

TREASURY TO 1SSUE RESULTS OF TODAY' S
10-YEAR NOTE AND 30-YEAR BOND AUCTIONS BY 2:30 P.M.

The Treasury has announced

that in its continuing

effort to release results of auctions

more quickly, it intends to publish the auction results for long-term

EDST. This 2:30 p. m. release time
with tomorrow's

will begin with today's

securities by 2:30 p. m. ,

10-year note auction and continue

30-year bond offering.

At thts time, the 2.'30 p. m. release will only apply to 10-year notes and 30-year bonds.

The Treasury is continuing to examine methods to release all auction results earlier.

o0o

PA-23

are O+

portment of the Treasury
Embargoed Until
August 8, 1990

~

Washlnatqp,
0

1:00 p. m.
Remarks

p.Q, y Telqpholle Sea-S44
Gi

I'"~

S~l'

by

Secretary of the Treasury

F.
at the

Nicholas

National

Brady

Press Club

President Bush signed legislation
providing funds to protect insured depositors in insolvent
savings and loans and setting tough new rules to ensure safety
and soundness in the thrift industry.
The enactment of the
depositor rescue bill culminated seven-and-a-half months of work
by the Congress based on a plan submitted by the President just
18 days after his inauguration.
One

Now,

mistake:

painless.
eradicated
report.

year ago tomorrow,

one year later, the job is getting done.
But make no
The problem is immense and the solution is not
A problem that was decades in the making cannot be
in one year. But there is tangible progress to

it's

evident to even the most casual observer that
issue has become highly politicized.
The staggering size
of the cost estimates understandably alarms taxpayers and
frightens politicians into finger-pointing and blame-avoiding.
The line in the political world goes, "Since I don't make
mistakes, someone else must be making them. "

the

However,

S&L

But we in the Administration
cannot afford that luxury.
Our
job is to conduct the massive cleanup operation effectively and
responsibly, to rise above the political blame-game, and to work
steadily and professionally and get the job done. This is what
the taxpayers expect, and it is what they deserve. A thousand
words of political sophistry will not get the job done; only hard
work applied with sound principles will do so. At any rate, that.
is exactly what we are doing.

all the political turmoil that surrounds the S&L cleanup,
not lose sight of the person whose investment we are
protecting: the average American saver who put his savings in an
S&L -- a wage earner or a retired person with perhaps just a few
thousand dollars -- someone who would have no way of recovering
from the loss if his or her thrift institution went broke.
But
the truth of the matter is S&Ls did go broke. Millions of
In

we must

inartment of the Treasury
Embargoed Until
August 8, 1990

~

washlnstqll,

D,

g y, telephone

5$$-2041

0 «-I. GFT';-~

1:00 p. m.
Remarks

by

Secretary of the Treasury

F.
at the

Nicholas

National

Brady

Press Club

One year ago tomorrow,
President Bush signed legislation
providing funds to protect insured depositors in insolvent
savings and loans and setting tough new rules to ensure safety
and soundness in the thrift industry.
The enactment of the
depositor rescue bill culminated seven-and-a-half months of work
by the Congress based on a plan submitted by the President just
18 days after his inauguration.
Now,

mistake:

painless.
eradicated
report.

one year later,
The problem is
A problem that
in one year.

the job

is getting

done. But make no
the solution is not
in the making cannot be
But there is tangible progress to
immense and
was decades

it's evident to even the most casual observer that
issue has become highly politicized.
The staggering size
of the cost estimates understandably alarms taxpayers and
frightens politicians into finger-pointing and blame-avoiding.
The line in the political world goes, "Since I don't make
mistakes, someone else must be making them. "
the

However,

S&L

But

job is to

in the Administration cannot afford that luxury.
Our
conduct the massive cleanup operation effectively and

we

to rise above the political blame-game, and to work
steadily and professionally and get the job done. This is what.
the taxpayers expect, and it is what they deserve. A thousand
words of political sophistry will not get the job done; only hard
work applied with sound principles will do so. At any rate, that
is exactly what we are doing.
In all the political turmoil that surrounds the S&L cleanup,
we must not lose sight of the person whose investment
we are
protecting: the average American saver who put his savings in an
S&L -- a wage earner or a retired person with perhaps just a few
thousand dollars -- someone who would have no way of recovering
from the loss if his or her thrift institution went broke.
But
the truth of the matter is S&Ls did go broke. Millions of
responsibly,

stood to lose their money, but federal deposit
insurance made sure they got their money back. It is for
savers that the government has insisted that this problem no
matter how unpleasant, must be faced, not swept under the rug.

depositors

presented legislation 18
me say again, the President
no caving in to
obfuscation,
No
inauguration:
after
days
He presented the straight story, governed by
industry pressure.
four principles:
o
First, make sure that the millions of men and women whc
put their savings into insured thrifts get their money
back. No TV shots of people sleeping on cots overnight
outside of defunct thrifts, begging
to get back their money which should be returned
Let

quickly

and with

a smile.

Second, restore safety and soundness to the
Make
industry through tougher regulations.
that
if
so
entrepreneurs put up real money,
future losses, they, the owners, lose money
the taxpayers.
This is key. It has and it
the mindset of S&L management as it operates

future.

Third, close

down

and

thrift

the
there are

long before

will

change

in the

sell insolvent thrifts swiftly

efficiently so that taxpayer costs are minimized.
needed here. Don't waste time on the
blame game: Just do it.
and

No

explanation

fourth, aggressively prosecute the criminals and
fraudulent operators who stole the taxpayers' money.
Hard time for hardened criminals.

And

These principles were established as a result of a detailed
study made in late 1988. It took several months of pick and
shovel work to understand how these massive losses were incurred.
Our belief was that the facts would lead us to the solution.
And the President s legislative
They did.
proposal in February
1989 put these issues squarely before the Congress.

history of the industry's problems would be
charters restricted activities to fixedrate, long-term mortgage loans and the acceptance of short-term
deposits. This meant that whenever market interest rates rose,
thrift institutions had to pay higher interest on their deposits
than they received on average from their loans.
Perhaps

helpful.

The

a short

early

S&L

The Congress attempted to correct this problem in 1966 by
placing a ceiling on the interest rates that banks and thrifts
could pay. But in the late 1970s, when inflation and interest
rates soared, depositors pulled their money out of banks and

stood to lose their money, but federal deposit
insurance made sure they got their money back. It is for these
savers that the government has insisted that this problem, no
matter how unpleasant, must be faced, not swept under the rug.

depositors

the President presented legislation 18
no caving in to
No obfuscation,
days after inauguration:
He presented the straight story, governed
industry pressure.
four principles:
Let

me

say again,

First,

by

sure that the millions of men and women who
put their savings into insured thrifts get their money
back. No TV shots of people sleeping on cots overnight
outside of defunct thrifts, begging
to get back their money which should be returned
quickly and with a smile.
make

Second, restore safety and soundness to the
Make
industry through tougher regulations.
entrepreneurs put up real money, so that if
future losses, they, the owners, lose money
the taxpayers.
This is key. It has and it
the mindset of S&L management as it operates

future.

thrift

the
there are
long before
will change
in the

down and sell insolvent thrifts swiftly
efficiently so that taxpayer costs are minimized.
No explanation
needed here. Don't waste time on the
blame game:
Just do it.

Third, close
and

o

fourth, aggressively prosecute the criminals and
fraudulent operators who stole the taxpayers' money.
Hard time for hardened criminals.

And

These principles were established as a result of a detailed
study made in late 1988. It took several months of pick and
shovel work to understand how these massive losses were incurred.
Our belief was that the facts would lead us to the solution.
They did.
And the President s legislative
proposal in February
1989 put these issues squarely before the Congress.

history of the industry's problems would be
charters restricted activities to fixedrate, long-term mortgage loans and the acceptance of short-term
deposits. This meant that whenever market interest rates rose,
thrift institutions had to pay higher interest on their deposits
than they received on average from their loans.
Perhaps

helpful.

The

a short

early

S&L

The Congress attempted to correct this problem in 1966 by
placing a ceiling on the interest rates that banks and thrifts
could pay. But in the late 1970s, when inflation and interest
rates soared, depositors pulled their money out of banks and

thrifts in favor of investments paying higher market interest
rates. Portfolio values declined, operating losses mounted,
a substantial

portion of the industry

became

insolvent.

and

In 1980, Congress passed and President Carter signed
legislation phasing out deposit interest rate ceilings,
increasing deposit insurance from $40, 000 to $100, 000, expanding
the ability of thrifts to move away from home mortgages and
engage in commercial lending, and lowering capital requirements
for thrifts. Thrift regulators built on these congressional
actions by allowing brokered deposits and loosening other
restrictions on thrift operations, hoping thrifts could attract
more deposits, make high-return
loans, and thereby grow out of

their problems.

In 1982, Congress passed legislation further expanding the
ability of thrifts to make commercial loans, and at the same time
several states broadly expanded the permitted activities of
state-chartered thrifts that were supervised primarily by state
regulators but were eligible for federal deposit insurance.
Attempts by federal regulators to curb abuses by state-chartered

associations were discouraged

savings

by Congress.

The combination of higher federal deposit insurance
protection and brokered deposits did in fact give thrifts
increased access to a large pool of funds. However, the broader

for thrift lending encouraged riskier investments.
home mortgages were
Many thrift operators schooled in handling
ill-equipped to engage in the new job of complex commercial
transactions.
In addition, the cut in capital requirements for
operators reduced the entrance fee, opening the way for shoestring characters who stepped in to exploit the situation for
personal gain. With low capital requirements and federal
insurance, thrift operators were effectively granted a license to
authority

gamble with the taxpayers'
government loses.

money.

Heads they win;

tails

the

In 1984, the task force on financial regulation headed by
Vice President Bush recommended higher capital standards for S&Ls
which made risky loans and the elimination of misleading
accounting standards.
These principles were later incorporated
in the FIRREA legislation.

Finally, sharp declines in oil prices and weakness in the
agricultural sector contributed to devastating economic declines
Real estate values in those
in the southwest and other regions.
areas headed downward.
Large numbers of thrifts that had
invested in commercial real estate and other ventures became
insolvent -- particularly in the states where state thrift
charters were most lax. Federal deposit insurance was required

to back inadequately
'round

was on

its

regulated

way.

state thrifts,

and

the merry-go-

thrifts in favor of investments paying higher market interest
rates. Portfolio values declined, operating losses mounted,
a substantial

and

portion of the industry became insolvent.
In 1980, Congress passed and President Carter signed
legislation phasing out deposit interest rate ceilings,
increasing deposit insurance from $40, 000 to $100, 000, expanding
the ability of thrifts to move away from home mortgages and
engage in commercial lending, and lowering capital requirements
for thrifts. Thrift regulators built on these congressional
actions by allowing brokered deposits and loosening other
restrictions on thrift operations, hoping thrifts could attract
more deposits, make high-return
loans, and thereby grow out of

their problems.

In 1982, Congress passed legislation further expanding the
ability of thrifts to make commercial loans, and at the same time
several states broadly expanded the permitted activities of
state-chartered thrifts that were supervised primarily by state
regulators but were eligible for federal deposit insurance.
Attempts by federal regulators to curb abuses by state-chartered
savings associations were discouraged by Congress.
The combination of higher federal deposit insurance
and brokered deposits did in fact give thrifts
increased access to a large pool of funds. However, the broader

protection

for thrift
thrift operators

lending encouraged riskier investments.
schooled in handling home mortgages were
to
ill-equipped
engage in the new job of complex commercial
transactions.
In addition, the cut in capital requirements for
operators reduced the entrance fee, opening the way for shoestring characters who stepped in to exploit the situation for
personal gain. With low capital requirements and federal
insurance, thrift operators were effectively granted a license to
Heads they win; tails the
gamble with the taxpayers' money.

authority

Many

government

loses.

In 1984, the task force on financial regulation headed by
President
Vice
Bush recommended higher capital standards for S&Ls
which made risky loans and the elimination of misleading
accounting standards.
These principles were later incorporated
in the FIRREA legislation.

Finally, sharp declines in oil prices and weakness in the
agricultural sector contributed to devastating economic declines
Real estate values in those
in the southwest and other regions.
areas headed downward.
Large numbers of thrifts that had
invested in commercial real estate and other ventures became
insolvent -- particularly in the states where state thrift
charters were most lax. Federal deposit insurance was required
to back inadequately regulated state thrifts, and the merry-go'round

was on

its

way.

When

the FSLIC insurance

fund ran low because of numerous
Reagan Administration
requested $15 billion
in 1986. The House at first voted only $5

thrift failures, the

to recapitalize it
billion before finally agreeing in conference with the Senate, 18
months later and after a threatened veto, to authorize $10
billion -- one-third less than requested.
Congress also added
"forbearance" provisions sought by the thrift industry which
forced regulators to allow thrifts to stay open without adequate
capital. The condition of the thrift industry continued to
worsen.

thrifts and no cash, FSLIC sold a large
of insolvent institutions in 1988 by granting terms
because of the lack of funds.
These deals, which are currently
being reviewed by the RTC, added onto taxpayers additional future
obligations.
Faced with failing

number

it

As President Bush took office,
was apparent that we faced
a worsening situation.
Hundreds of thrifts had made high-risk
loans backed by taxpayer guarantees but little of their own
capital. When those loans went bad, the thrifts failed.

Mismanagement,
fraud and criminal activity exacerbated the
problem in many institutions.
recapitalized
The inadequately
FSLIC fund did not have sufficient funds to handle the crisis.

Certain principles

were incorporated

legislation.

First, the

can be drawn

into President

from

this history,

Bush's proposal

and these
and the FIRREA

deposit insurance guarantee must be
whatever the cost. Based on the best information
available from the FDIC, GAO, and Federal Home Loan Bank Board,
the size of the problem was projected to be $40 billion to cover
deals, the 1988 FSLIC, $50 billion to resolve then-insolvent
institutions over the ensuing three years and another $23 billion
(in present value terms) to fund future thrift failures through
1999.

honored,

government's

A year after FIRREA, the
is rock-solid. The government

government's promise to depositors
has paid out $62. 8 billion to
protect 6, 400, 000 accounts -- an average of less than $10, 000 per
deposit. Not one single American who trusted in the government's
promise to protect his savings has seen that promise violated.
To this day, each and every deposit of up to $100, 000 in a
federally insured institution remains totally safe -- fully
backed by the absolute guarantee of the federal government.

the FSLIC insurance fund ran low because of numerous
thrift, failures, the Reagan Administration requested $15 billion
to recapitalize it in 1986. The House at first voted only $5
billion before finally agreeing in conference with the Senate, 18
months later and after a threatened veto, to authorize $10
Congress also added
billion -- one-third less than requested.
"forbearance" provisions sought by the thrift industry which
forced regulators to allow thrifts to stay open without adequate
capital. The condition of the thrift industry continued to
When

worsen.

thrifts and no cash, FSLIC sold a large
of insolvent institutions in 1988 by granting terms
because of the lack of funds.
These deals, which are currently
being reviewed by the RTC, added onto taxpayers additional future
obligations.
As President Bush took office, it was apparent that we faced
a worsening situation.
Hundreds of thrifts had made high-risk
loans backed by taxpayer guarantees but little of their own
Faced with failing

number

those loans went bad, the thrifts failed.
Mismanagement,
fraud and criminal activity exacerbated the
recapitalized
problem in many institutions.
The inadequately
FSLIC fund did not have sufficient funds to handle the crisis.

capital.

When

Certain principles can be drawn from this history, and these
into President Bush's proposal and the FIRREA

were incorporated

legislation.

First, the

deposit insurance guarantee must be
honored, whatever the cost. Based on the best information
available from the FDIC, GAO, and Federal Home Loan Bank Board,
the size of the problem was projected to be $40 billion to cover
deals, the 1988 FSLIC, $50 billion to resolve then-insolvent
institutions over the ensuing three years and another $23 billion
(in present value terms) to fund future thrift failures through
1999.
government's

A year after FIRREA, the
is rock-solid. The government

government's promise to depositors
has paid out $62. 8 billion to
protect 6, 400, 000 accounts -- an average of less than $10, 000 per
deposit. Not one single American who trusted in the government's
promise to protect his savings has seen that promise violated.
To this day, each and every deposit of up to $100, 000 in a
federally insured institution remains totally safe -- fully
backed by the absolute guarantee of the federal government.

However, as the RTC has gained specific experience, Chairman
Seidman has indicated that the costs will be higher than
originally estimated.
The value of the assets held by insolvent
thrifts turned out to be lower than anticipated, and as everyone
in this room knows, the real estate markets continued to worsen.

Based on the RTC's actual results and the current state of
the real estate markets, I presented to Congress a new range for
the total cost of the RTC cleanup: $90 to $130 billion in present
value terms. These figures include the $73 billion already
authorized by Congress, but not the cost of the 1988 FSLIC deals.
A word of warning
as we go forward: No one can be precise
about the exact cost of the cleanup.
It depends almost entirely
on the state of the real estate market at the time the RTC sells
the assets it has taken over.

It's being used to
Where is all the taxpayer's money going'?
off
whose
was
lost
depositors
or stolen by thrift
money
pay
operators who made unwise investments or engaged in fraudulent
deals. Clearly, the conditions that allowed this to occur had to
be rectified.
That, in fact, was the second principle advanced by the
President: To ensure the safety and soundness of the industry,
thrift operators must be required to place their own money at
risk ahead of the taxpayers', and regulators must be given a
stronger hand.

Specifically, the Administration recommended that thrifts be
to meet much tougher capital and accounting standards.
truly sound institutions should be permitted to continue

required
Only

operating

with the federal

deposit insurance

guarantee.

Following intense debate in Congress over capital standards,
the thrift industry position was narrowly defeated and the
Administration's
tough capital and accounting standards were
adopted in FIRREA.

also requires thrifts to maintain 70 percent of
real estate and restricts risky
investments.
Junk bonds, for example, are prohibited and
brokered deposits are not permitted for undercapitalized
thrifts.
Direct real estate or equity investment must be backed by 100
percent capital. And state-chartered thrifts that do not meet
these federal requirements can be denied federal deposit
insurance.
The new law

their assets in residential

The practices which led to the thrift disaster have been
largely eliminated and the new Office of Thrift Supervision in
the Treasury Department has entered into binding agreements with
220 thrifts terminating unsafe and unsound practices.
We are

However, as the RTC has gained specific experience, Chairman
Seidman has indicated that the costs will be higher than
originally estimated. The value of the assets held by insolvent
thrifts turned out to be lower than anticipated, and as everyone
in this room knows, the real estate markets continued to worsen.

Based on the RTC's actual results and the current state of
the real estate markets, I presented to Congress a new range for
the total cost of the RTC cleanup: $90 to $130 billion in present
value terms. These figures include the $73 billion already
authorized by Congress, but not the cost of the 1988 FSLIC deals.
A word of warning
as we go forward: No one can be precise
about the exact cost of the cleanup.
It depends almost entirely
on the state of the real estate market at the time the RTC sells
the assets it has taken over.

Where

is all the taxpayer's

It's

money going'?
was lost or stolen

being used to

off depositors whose money
by thrift
who made unwise investments
or engaged in fraudulent
deals. Clearly, the conditions that allowed this to occur had to
be rectified.
That, in fact, was the second principle advanced by the
President: To ensure the safety and soundness of the industry,
thrift operators must be required to place their own money at
risk ahead of the taxpayers', and regulators must be given a

pay

operators

stronger hand.

Specifically, the Administration recommended that thrifts be
to meet much tougher capital and accounting standards.
truly sound institutions should be permitted to continue

required
Only

operating

with the federal

deposit insurance

guarantee.

Following intense debate in Congress over capital standards,
the thrift industry position was narrowly defeated and the
Administration's
tough capital and accounting standards were
adopted in FIRREA.

also requires thrifts to maintain 70 percent of
assets
residential
real estate and restricts risky
their
in
investments.
Junk bonds, for example, are prohibited and
brokered deposits are not permitted for undercapitalized
thrifts.
Direct real estate or equity investment must be backed by 100
percent capital. And state-chartered thrifts that do not meet.
these federal requirements can be denied federal deposit
The new law

insurance.

practices which led to the thrift disaster have been
and the new Office of Thrift Supervision in
eliminated
largely
the Treasury Department has entered into binding agreements with
220 thrifts terminating unsafe and unsound practices.
We are
The

also nearing the final stages of an 18-month effort to assess the
overall competitiveness of our financial services system within
the context of the deposit insurance study mandated by FIRREA.
third principle that guided the Administration was that
delay in closing down insolvent thrifts would only lead to
increased costs later. The Administration therefore determined
that we would move quickly to take over insolvent thrifts.
The

a matter of a few months following the enactment of
the size of
FIRREA, the RTC assembled a financial organization
Citibank with more than 3, 000 people given the mission of
aggressively tackling the thrift cleanup. At the end of the
first year, an impressive record of accomplishment has been

Within

achieved.

over 472 insolvent thrifts, more than one
per day. It has closed or sold 211 bankrupt S&Ls, one every 48
hours. And the RTC has sold or liquidated more than $73 billion
worth of assets, $200 million per day. Just last week, the RTC
announced plans to dispose of an additional $50 billion in assets
this year. We have been encouraging the RTC to move even faster.
The RTC has taken

Bill

and the RTC face a tough and thankless job. No
well they do, there is no way to do the job perfectly
and there will be criticism.
But this will be the case whether
they move quickly or slowly, so the decision was to get on with
it, construct an industry with sound thrifts, and lower the cost
of funds to the healthy portion of the industry.

matter

Seidman

how

principle was that tougher penalties and more
aggressive prosecution of criminals were needed to deter similar
crimes in the future.
The Administration
proposed and Congress
enacted tougher civil penalties -- up to $1 million per day-and 20-year jail sentences for S&L fraud.
The fourth

recently, the President requested important new
authorities, including wiretapping, the ability to seek court
orders to freeze the corporate and personal assets of civil
defendants and prohibitions on the use of bankruptcy to avoid
federal recoveries of assets.
More

Since October 1988, the Justice Department has obtained 231
convictions for major cases of S&L fraud. In addition, the FBI
is currently conducting 530 investigations of fraud in failed
banks and thrifts -- an increase of 88 percent from 1987. And
settlements and judgments from civil cases during the first half
of 1990 will produce recoveries in excess of $200 million.
Let me review: Protect the depositor.
Restore safety and
soundness to the industry.
Clean up the insolvent institutions.
And prosecute the criminals.

also nearing the final stages of an 18-month effort to assess the
overall competitiveness of our financial services system within
the context of the deposit insurance study mandated by FIRREA.
third principle that guided the Administration was that
delay in closing down insolvent thrifts would only lead to
increased costs later. The Administration therefore determined
that we would move quickly to take over insolvent thrifts.
The

a matter of a few months following the enactment of
assembled a financial organization the size of
Citibank with more than 3, 000 people given the mission of
At the end of the
aggressively tackling the thrift cleanup.
first year, an impressive record of accomplishment has been

Within

the

FIRREA,

RTC

achieved.

over 472 insolvent thrifts, more than one
per day. It has closed or sold 211 bankrupt S&Ls, one every 48
hours. And the RTC has sold or liquidated more than $73 billion
worth of assets, $200 million per day. Just last week, the RTC
announced plans to dispose of an additional $50 billion in assets
this year. We have been encouraging the RTC to move even faster.
The RTC has taken

Bill

and the RTC face a tough and thankless job. No
well they do, there is no way to do the job perfectly
and there will be criticism.
But this will be the case whether
they move quickly or slowly, so the decision was to get on with
it, construct an industry with sound thrifts, and lower the cost
of funds to the healthy portion of the industry.

matter

Seidman

how

principle was that tougher penalties and more
aggressive prosecution of criminals were needed to deter similar
crimes in the future.
The Administration
proposed and Congress
enacted tougher civil penalties -- up to $1 million per day-and 20-year jail sentences for S&L fraud.
The fourth

recently, the President requested important new
authorities, including wiretapping, the ability to seek court
orders to freeze the corporate and personal assets of civil
defendants and prohibitions on the use of bankruptcy to avoid
federal recoveries of assets.
Since October 1988, the Justice Department has obtained 231
convictions for major cases of S&L fraud. In addition, the FBI
is currently conducting 530 investigations of fraud in failed
banks and thrifts -- an increase of 88 percent from 1987. And
settlements and judgments from civil cases during the first half
of 1990 will produce recoveries in excess of $200 million.
Let me review: Protect the depositor.
Restore safety and
soundness to the industry.
Clean up the insolvent institutions.
And prosecute the criminals.
More

A year after stepping
forward to tackle this huge task,
there are substantial specific accomplishments.
The job is
getting done. And we will continue to work efficiently and
professionally until the job is complete.

Thank you.

year after stepping

forward to tackle this huge task,
there are substantial specific accomplishments.
The job is
getting done. And we will continue to work efficiently and
professionally until the job is complete.
A

Thank you.

8, 1990

August
THE S &L

CRISIS -

MAJOR ADMINISTRATION

ACCOMPLISHMENTS

Eighteen days after taking office, president Bush stepped
In the
forward with a comprehensive solution to the S&L crisis.
the Financial
year since the Congress passed his legislation,
Act (FIRREA),
Institution
and Enforcement
Reform,
Recovery,
significant progress has been made.

1.

The Depositors

o

Protected.
insured depositors

Have Been

federally
against loss.

All

have

been

protected

Six million accounts, representing the savings of
millions of American families, have been made
whole.

protection

received

Depositors

have

The average

account protected

on

$62. 8

billion of deposits that would have experienced
losses without federal deposit insurance.
The

of the deposit insurance

integrity

preserved.
No

insured

saver

has

lost

failure of a federally insured

The U. S.
commitment

Government

Confidence

in the Government's

savings

strong.

is

to

protect

of Americans.

is

a

about $10, 000.
system has been

due
savings and
dime

to the

loan.

standing
behind
its
the federally
insured

guarantee

remains

The Government's
commitment
and the resulting
public confidence have kept the financial system
operating continuously and efficiently.

2.

The System Has Been Reformed.

Savings

and

Loans

now

have

higher,

more

stringent

capital requirements.
Real capital requirements
have been put in place
to require thrift owners and operators to give
greater protection to depositors and put more of
their own money at risk.

8, 1990

August
THE S&L

CRISIS:

MAJOR ADMINISTRATION

ACCOMPLISEBGBTTS

Eighteen days after taking office, president Bush stepped
In the
with a comprehensive solution to the S&L crisis.
Financial
the
year since the Congress passed his legislation,
Act (FIRREA),
Institution
and Enforcement
Reform,
Recovery,
significant progress has been made.
forward

The Depositors

0

Protected.
insured depositors

Have Been

federally
against loss.

All

have

been

protected

Six million accounts, representing the savings of
millions of American families, have been made
whole.

received protection
on $62. 8
billion of deposits that would have experienced
losses without federal deposit insurance.
The

Depositors

have

The average

account protected

of the deposit insurance

integrity

preserved.
No

is

insured

saver

has

lost

a

about $10, 000.
system has been
dime

failure of a federally insured savings

The U. S.
commitment

Government

Confidence

in the Government's

savings

strong.

to

protect

of Americans.

is

due
and

to the
loan.

standing
behind
its
the federally
insured

guarantee

remains

commitment
and the resulting
public confidence have kept the financial system
operating continuously and efficiently.

The

2.

Government's

The System Has Been Reformed.

Savings

and

Loans

now

have

higher,

more

stringent

capital requirements.
Real capital requirements
have been put in place
to require thrift owners and operators to give
greater protection to depositors and put more of
their own money at risk.

--

requiring standards
key reform in FIRREA
for genuine and substantial capital invested by
has been
owners
of thrift institutions
implemented.

The

--

oversight

Regulatory

The regulatory

depositors'
protection
The

thrift

has been tightened.

function has been isolated from the
fund
to provide greater
insurance

and

objectivity.

examiners

been

have

absorbed

by

the

Office of Thrift Supervision and placed under the
general oversight of the Treasury Department.

--

The thrift insurance funds
Federal Savings and
Loan Insurance Corporation (FSLIC) and the Savings
Association Insurance Fund (SAIF)
have been

into the
brought
Corporation (FDIC).

High

risk

curtailed.

thrift

Federal

investment

--

Deposit

practices

Insurance

have

been

thrifts that are insolvent and losing money
have
been identified
and
placed in
conservatorship,
or resolved,
while protecting
depositors.
220 institutions
have entered
into binding
agreements to alter high risk banking practices (a
total of 664 in the past three years).
The lending
activities of thrifts have been
refocused on the business they know best-residential mortgages -- and credit is granted
based on economic merit, rather than speculative

Most

risk.

Thrifts can no longer engage in direct real estate
or equity investment without 100 percent capital,
and junk bond investments have been prohibited.

Institutions Are Being Cleaned Up Expeditiously.
Insolvent institutions have been taken over.

Unsound

o

The RTC has taken over 472
than one per day.

insolvent

thrifts,

more

--

requiring standards
key reform in FIRREA
for genuine and substantial capital invested by
has been
owners
of thrift institutions
implemented.

The

--

oversight

Regulatory

has been tightened.

regulatory function has been isolated
depositors'
fund
to provide
insurance
protection and objectivity.
The

The

thrift

examiners

been

have

from the

greater

absorbed

by

the

Office of Thrift Supervision and placed under the
general oversight of the Treasury Department.

--

The thrift insurance funds
Federal Savings and
Loan Insurance Corporation (FSLIC) and the Savings
Association Insurance Fund (SAIF)
have been

into the
brought
Corporation (FDIC).

High

risk

curtailed.
Most

thrift

--

Federal

investment

Deposit

practices

thrifts that are insolvent

have
been
conservatorship,
depositors.

identified
or

resolved,

and

and

while

Insurance

have

been

losing

money

placed

in
protecting

220 institutions
have
entered
into binding
agreements to alter high risk banking practices (a
total of 664 in the past three years).
The

activities of thrifts have been
best-on the business
know
-- and they
credit is granted
mortgages
on economic merit, rather than speculative

lending

refocused
residential

based

risk.

Thrifts can no longer engage in direct real estate
or equity investment without 100 percent capital,
and junk bond investments
have been prohibited.

Institutions Are Being Cleaned Up Expeditiously.
Insolvent institutions have been taken over.

Unsound

0

The RTC has taken over 472
than one per day

insolvent

thrifts,

more

In
211 bankrupt S&Ls have been closed or sold.
the latest quarter, 155 institutions -- or a dozen
per week -- have been shut down.
The

cost to the taxpayers is being minimized.
began
Trust Corporation
Resolution
(RTC)
In
business the day the legislation was signed.
the
created
less than a year, the Government
in the country,
largest financial institution

The

involved

which

efforts to staff
policies and procedures.

enormous

develop appropriate

assets of the

The
most

RTC

are being liquidated

to

and

in the

to maximize return to the
taxpayers by proceeding quickly but in a manner so
as to avoid disrupting real estate markets.
Regional advisory boards have been established to
provide guidance to the RTC on local real estate
prudent

conditions

The Individuals

Those

manner

and

aid in maximizing

Are Being Penalized.

Responsible

in

engaged

who

prosecuted.

value recovery.

activity

criminal

are

being

Since October 1988, the Justice Department
indicted over 328 people involved in fraud
other criminal activity.
231 people have been convicted
$56. 6 million in restitution.

three-quarters

and ordered

has
and

to

pay

of

those sentenced
have
received prison terms running as high as 30 years.

Over

Criminal

strengthened.
An

enforcement

$50 million

incremental

to prosecute

S&L

148

additional

The

FBI

hired.

investigate

capabilities

has

added
S&Ls.

been

has been appropriated

crimes.

Federal

have

prosecutors

over

200

new

have

agents

been

to

In
211 bankrupt S&Ls have been closed or sold.
-or a dozen
the latest quarter, 155 institutions
per week -- have been shut down.
o

The

cost to the taxpayers is being minimized.
began
Trust Corporation
Resolution
(RTC)
In
business the day the legislation was signed.
less than a year, the Government created the
in the country,
largest financial institution

The

involved

which

efforts to staff
policies and procedures.

enormous

develop appropriate

assets of the

and

to

are being liquidated in the
manner
to maximize return to the
prudent
taxpayers by proceeding quickly but in a manner so
as to avoid disrupting real estate markets.

The
most

RTC

Regional advisory boards have been established to
provide guidance to the RTC on local real estate
conditions and aid in maximizing value recovery.
The Individuals

0

Those

Are Being Penalized.

Responsible
engaged

who

prosecuted.

in

activity

criminal

are

being

Since October 1988, the Justice Department
indicted over 328 people involved in fraud
other criminal activity.
231 people have been convicted
$56. 6 million in restitution.

and ordered

has
and

to

pay

three-quarters
of those sentenced have
received prison terms running as high as 30 years.

Over

Criminal

strengthened.
An

enforcement

$50 million

incremental

to prosecute

additional

The

FBI

investigate

has

Federal
added

S&Ls.

have

been

has been appropriated

crimes.

S&L

148

hired.

capabilities

prosecutors

over

200

new

have

agents

been

to

8, 1990

August
THE S&L

CRISIS:

MAJOR ADMINISTRATION

ACCOMPLISHMENTS

Eighteen days after taking office, president Bush stepped
In the
forward with a comprehensive solution to the S&L crisis.
Financial
the
year since the Congress passed his legislation,
Act (FIRREA),
and Enforcement
Institution
Reform,
Recovery,
significant progress has been made.
The Depositors
o

Protected.
insured depositors

Have Been

have been protected
federally
against loss.
Six million accounts, representing the savings of
millions of American families, have been made

All

whole.

received protection
on
$62. 8
would
have
billion of deposits that
experienced
losses without federal deposit insurance.
o

The

Depositors

have

The average

account protected

insured

failure of

a

saver

has

federally

lost

insured

The U. S.
commitment

Government

Confidence

in the Government's

savings

strong.

about $10, 000.

of the deposit insurance

integrity

preserved.
No

is

to

protect

of Americans.

is

a

has been

system
dime

savings

due
and

to the

loan.

standing
behind
its
the federally
insured

guarantee

remains

the

resulting
public confidence have kept the financial system
operating continuously and efficiently.
The

2~

Government's

commitment

and

The System Has Been Reformed.

Savings

and

Loans

now

have

higher,

more

stringent

capital requirements.
Real capital requirements
have been put in place
to require thrift owners and operators to give
greater protection to depositors and put more of
their own money at risk.

8, 1990

August
THE S&L

CRISIS

MAJOR ADMINISTRATION

ACCOMPLISHMENTS

Eighteen days after taking office, president Bush stepped
In the
forward with a comprehensive solution to the S&L crisis.
the Financial
year since the Congress passed his legislation,
Act (FIRREA),
and Enforcement
Institution
Reform,
Recovery,
significant progress has been made.

1.

The Depositors

Protected.
insured depositors

Have Been

federally
against loss.

All

have

been

protected

Six million accounts, representing the savings of
millions of American families, have been made
whole.

protection

received

Depositors

have

The average

account protected

on

$62. 8

billion of deposits that would have experienced
losses without federal deposit insurance.
The

of the deposit insurance

integrity

preserved.
No

insured

failure of

a

saver

has

federally

lost

insured

The U. S.
commitment

Government

Confidence

in the Government's

savings

strong.

is

to

protect

of Americans.

is

a

about $10, 000.
has been

system
dime

savings

due
and

to the

loan.

standing
behind
its
the federally
insured

guarantee

remains

Government's
commitment
and the resulting
public confidence have kept the financial system
operating continuously and efficiently.
The

2.

The System Has Been Reformed.

0

Savings

and

Loans

now

have

higher,

more

stringent

capital requirements.
have been put in place
Real capital requirements
thrift
owners
and operators
to require
to give
greater protection to depositors and put more of
their own money at risk.

standards
key reform in FIRREA -- requiring
for genuine and substantial capital invested by
has been
owners
of thrift institutions
implemented.

The

--

oversight

Regulatory
The

regulatory

depositors'
protection
The

thrift

has been tightened.

function has been isolated from the
greater
fund to provide
insurance

and

objectivity.

examiners

have

been

absorbed

by

the

Office of Thrift Supervision and placed under the
general oversight of the Treasury Department.

--

The thrift insurance funds
Federal Savings and
Loan Insurance Corporation (FSLIC) and the Savings
have been
Association Insurance Fund (SAIF)

into the
brought
Corporation (FDIC).

High

risk

curtailed.

thrift

Federal

investment

--

Deposit

practices

Insurance

have

been

thrifts that are insolvent and losing money
have
been
identified
and
placed in
or resolved,
while protecting
conservatorship,
depositors.
220 institutions
have
entered
into binding
agreements to alter high risk banking practices (a
total of 664 in the past three years).
The
activities of thrifts have been
lending
refocused on the business they know best-residential mortgages -- and credit is granted
based on economic merit, rather than speculative

Most

risk.

Thrifts can no longer engage in direct real estate
or equity investment without 100 percent capital,
and junk bond investments have been prohibited.

3.

Institutions Are Being Cleaned Up Expeditiously.
Insolvent institutions have been taken over.

Unsound

o

The RTC has taken over 472
than one per day.

insolvent

thrifts,

more

--

requiring standards
key reform in FIRREA
for genuine and substantial capital invested by
has been
owners
of thrift institutions
implemented.

The

--

oversight

Regulatory

The regulatory

depositors'
protection
The

thrift

has been tightened.

function
insurance

and

has been isolated

to provide

fund

objectivity.

examiners

have

been

from the

greater

absorbed

by

the

Office of Thrift Supervision and placed under the
general oversight of the Treasury Department.

--

The thrift insurance funds
Federal Savings and
Loan Insurance Corporation (FSLIC) and the Savings
Association Insurance Fund (SAIF)
have been

into the
brought
Corporation (FDIC).

High

risk

curtailed.

thrift

Federal

investment

--

Deposit

practices

Insurance

have

been

thrifts that are insolvent and losing money
have
been identified
and
placed in
or resolved,
while protecting
conservatorship,
depositors.
220 institutions
have entered
into binding
agreements to alter high risk banking practices (a
total of 664 in the past three years).
The lending
activities of thrifts have been
refocused on the business they know best-residential mortgages -- and credit is granted
based on economic merit, rather than speculative

Most

risk.

Thrifts can no longer engage in direct real estate
or equity investment without 100 percent capital,
have been prohibited.
and junk bond investments

Institutions Are Being Cleaned Up Expeditiously.
Insolvent institutions have been taken over.

Unsound

The RTC has taken over 472
than one per day.

insolvent

thrifts,

more

In
211 bankrupt S&Ls have been closed or sold.
-dozen
or a
the latest quarter, 155 institutions
per week -- have been shut down.
The

cost to the taxpayers is being minimized.
began
Resolution
Trust Corporation
(RTC)
In
business the day the legislation was signed.
less than a year, the Government created the
in the country,
largest financial institution

The

involved

which

efforts to staff
policies and procedures.

enormous

develop appropriate

assets of the

and

to

are being liquidated in the
to maximize return to the
prudent
taxpayers by proceeding quickly but in a manner so
as to avoid disrupting real estate markets.

The
most

RTC

manner

Regional advisory boards have been established to
provide guidance to the RTC on local real estate
conditions and aid in maximizing value recovery.
The Individuals

0

Those

Are Being Penalized.

Responsible

in

engaged

who

prosecuted.

activity

criminal

are

being

Since October 1988, the Justice Department
indicted over 328 people involved in fraud
other criminal activity231 people have been convicted
$56. 6 million in restitution.

three-quarters

and ordered

has
and

to

pay

of

those sentenced
have
received prison terms running as high as 30 years.

Over

0

Criminal

strengthened.
An

enforcement

$50 million

incremental

to prosecute

S&L

148

additional

The

FBI

hired.

investigate

capabilities

has

added
S&Ls.

been

has been appropriated

crimes.

Federal

have

prosecutors

over

200

new

have

agents

been

to

In
211 bankrupt S&Ls have been closed or sold.
the latest quarter, 155 institutions -- or a dozen
per week -- have been shut down.
The

cost to the taxpayers is being minimized.
began
Resolution
Trust Corporation
(RTC)
In
business the day the legislation was signed.
the
created
less than a year, the Government
in the country,
largest financial institution
which involved enormous efforts to staff and to
develop appropriate policies and procedures.

The

assets of the

are being liquidated in the
maximize
return to the
taxpayers by proceeding quickly but in a manner so
as to avoid disrupting real estate markets.
The

prudent

most

The Individuals

Those

and

to the

value recovery.

Are Being Penalized.

in

engaged

who

to
local real estate

RTC on

aid in maximizing

Responsible

prosecuted.

to

boards have been established

Regional advisory
provide guidance

conditions

RTC

manner

activity

criminal

are

being

Since October 1988, the Justice Department
indicted over 328 people involved in fraud
other criminal activity.
231 people have been convicted
$56. 6 million in restitution.

and ordered

has
and

to

pay

three-quarters
of those sentenced have
received prison terms running as high as 30 years.

Over

0

Criminal

strengthened.
An

enforcement

$50 million

incremental

to prosecute

additional

The

FBI

investigate

has

Federal
added

S&Ls.

have

been

has been appropriated

crimes.

S&L

148

hired.

capabilities

prosecutors

over

200

new

have

agents

been

to

Impartment

OUI

of ihe Treasury

~ Washlnyion,
'. O""HE

D.C. ~ Telephone $66-2041

ih-A' ". h(

CpNTACT:pffice

RESULTS OF TREASURY'S AUCTION

OF 10-YEAR NOTES

FOR IMMEDIATE

of Financing

202/376-4350

RELEASE

8, 1990

August

for $10, 503 million of 10-year notes to be issued
15, 1990 and to mature on August 15, 2000 were
accepted today (CUSIP: 912827ZE5) (Series C-2000).
The range
The interest rate on the notes will be 8 3/44.
of accepted bids, and the corresponding prices at the 8 3/44
interest rate are as follows:
Tenders

on August

MDd
Low

8. 744
8. 844
8. 774

P~e

100. 066

99.411
99.869
Average
$50, 000 accepted at lower yields.
Tenders at the high yield were allotted 664.
High

TENDERS RECEIVED AND ACCEPTED

(in Thousands)

o~~~

J
Boston
New

York

Philadelphia

Cleveland
Richmond

Atlanta

Chicago
Louis
Minneapolis
Kansas City

St.

Dallas
San Francisco
Treasury

gkkt~vg
12, 448
15, 241, 684
5, 423

11,439
15, 709
9, 296

1, 051, 424

18, 062

22, 687

16, 890
4, 515

324, 433

/~cue

12, 448
9, 734, 884
5, 423
11,439
15, 709
9, 296
575, 924
16, 062
22, 687
16, 890
4, 515
74, 433

$10, 502, 824
$16, 737, 124
The $10, 503 million of accepted tenders includes $560
million of noncompetitive tenders and $9, 943 million of
competitive tenders from the public.
TOTALS

In addition to the $10, 503 million of tenders accepted in
the auction process, $215 aillion of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
An additional
international monetary authorities.
$350
million of tenders was also accepted at the average price from
Federal Reserve Banks for their own account in exchange for
maturing

securities.

The ainiaua par amount required for STRIPS is $160, 000.
Larger aaounts aust be in aultiples of that aaount.

00,
iarimeni of ihe Treasury

~ Washlnyion,
DE-

FOR IMMEDIATE

''-OI" "IHF. Ih-O'. , L'hY

D.C. ~ Telephone $66-204
CpNTACT:p f fice of Financing
202/376-4350

RELEASE

8, 1990

August

RESULTS OF TREASURY'S AUCTION

OF 10-YEAR NOTES

for $10, 503 million of 10-year notes to be issued
on August 15, 1990 and to mature on August 15, 2000 were
accepted today (CUSIP: 912827ZE5) (Series C-2000).
The range
The interest rate on the notes will be 8 3/44.
of accepted bids, and the corresponding prices at the 8 3/44
interest rate are as follows:
Tenders

8. 744
8. 84%
8. 774

100. 066
99.411
99.869
Average
$50, 000 accepted at lower yields.
Tenders at the high yield were allotted 664.
Low

High

TENDERS RECEIVED AND ACCEPTED

(in Thousands)

going

Boston
New

York

Philadelphia

Cleveland
Richmond

Atlanta

Chicago
Louis
Minneapolis
Kansas City

St.

Dallas

San Francisco

Treasury

Li~~ivQQ
12, 448
15, 241, 684
5, 423

11,439

15, 709
9, 296
1, 051, 424
18, 062
22, 687
16, 890

4, 515
324, 433

~c~g
12, 448

9, 734, 884
5, 423
11,439
15, 709
9, 296
575, 924
16, 062
22, 687
16, 890

4, 515
74, 433

$10, 502, 824
$16, 737, 124
The $10, 503 aillion of accepted tenders includes $560
million of noncompetitive tenders and $9, 943 million of
competitive tenders from the public.
TOTALS

In addition to the $10, 503 million of tenders accepted in
the auction process, $215 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
An additional
international monetary authorities.
$350
million of tenders was also accepted at the average price from
Federal Reserve Banks for their own account in exchange for
maturing

securities.

par amount required for STRIPS is $160, 000.
Larger aaounts aust be in aultiples of that aaount.
The ainiaua

J4

jk

.0

Ipariment of the Treasury

77
Washlnoton,

~

~-' i. 0F Ti'L
FOR IMMEDIATE

August

n. c. ~ Telephone %66-g44$

THEA.-, Uqy

RELEASE

Office of Financing

CONTACT:

9, 1990

202/376-4350

RESULTS OF TREASURY'S AUCTION
OF 36-DAY CASH MANAGEMENT BILLS

Tenders for $10, 088 million of 36-day Treasury bills to
be issued on August 15, 1990, and to mature September 20, 1990,
were accepted at the Federal Reserve Banks today.
The details

are as follows:

RANGE

Discount
Rate

7. 78o
7. 800
High
7. 79'o
Average
Tenders at the

OF ACCEPTED COMPETITIVE

BIDS

Rate
on-Issue Yield)

Investment

(E

Low

high

ivalent

Cou

7. 95o
7. 97o
7. 96o
discount rate were allotted 21:.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)

Location
Boston
New

York

Philadelphia

Received

Acce ted

48, 953, 000

8, 235, 370

4, 550, 000

1, 763, 000

1, 425, 000
$54, 928. 000

89, 250

$

Cleveland
Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas

San Francisco
TOTALS

Price
99. 222
99. 220
99. 221

$10, 087, 620

ffB

I

p~~en&

4& t' he TFeosIIFV ~

|' t

I

Woshlngton,

D.C. ~ Telephone

566.204

PT. 0F TiIF yg~, -;!I -, y
&

FOR IMMEDIATE

August

RELEASE

Office of Financing

CONTACT:

9, 1990

202/376-4350

RESULTS OF TREASURY'S AUCTION
OF 36-DAY CASH MANAGEMENT BILLS

Tenders for $10, 088 million of 36-day Treasury bills to
be issued on August 15, 1990, and to mature September 20, 1990,
were accepted at the Federal Reserve Banks today.
The details

are as follows:

RANGE

Discount
Rate

7. 78o
7. 80o
7. 79o
Average
Tenders at the

OF ACCEPTED COMPETITIVE

BIDS

Rate
on-Issue Yield)

Investment

(E

ivalent

Cou

7. 950
7. 97'o
7. 96-o

Low

High

high discount

rate were allotted 21-:

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)
Received

Acce ted

48, 953. 000

8, 235, 370

Chicago
St. Louis
Minneapolis
Kansas City

4, 550, 000

1, 763. 000

San Francisco

1, 425, 000

89, 250

$54, 928, 000

$10, 087, 620

Location
Boston
New

York

Philadelphia

$

Cleveland
Richmond

Atlanta

Dallas

TOTALS

Price
99. 222
99. 220
99. 221
~

DEPARTMENT OF THE TREASURY
WASHINGTON

j
~

Acknowledgment

I

)

of Filing of Statements

of Kuwait has filed statements concerning
certain Kuwaiti-controlled firms in the U. S. Accordingly,
U. S. financial institutions are hereby authorized until
August 25, 1990, to accept deposits and clear checks written
on the blocked accounts of the Kuwaiti-controlled
firms in
the United States listed below (including their subsidiaries
and affiliates) and in general to operate such firms'
blocked bank accounts, provided that no benefit to the
Government of Iraq arises from transactions in the blocked
The Embassy

accounts:

Santa Fe International

Corporation

Fosterlane Holdings Corporation
Crescent Holdings, Inc.
Wafra Intervest Corporation (Cayman)
KFIC,

Inc.

Inc.
questions regarding this

Georgetown
Any

Industries,

acknowledgment

may

be directed

to the Blocked Assets Section, Office of Foreign Assets
Control, Department of the Treasury, Washington, D. C. 20220
(telephone

202-535-4026).

R. Richard

Newco

Director
Office of Foreign Assets Control

DEPARTMENT OF THE TREASURY
WASHINGTON

~

1

I

of Filing of Statements

Acknowledgment

of Kuwait has filed statements concerning
certain Kuwaiti-controlled firms in the U. S. Accordingly,
are hereby authorized until
U. S. financial institutions
and clear checks written
deposits
August 25, 1990, to accept
firms in
Kuwaiti-controlled
on the blocked accounts of the
subsidiaries
the United States listed below (including their
and affiliates) and in general to operate such firms'
blocked bank accounts, provided that no benefit to the
Government of Iraq arises from transactions in the blocked
The Embassy

accounts:

Santa Fe International

Fosterlane Holdings
Crescent Holdings,

Corporation

Corporation

Inc.

Wafra

Intervest Corporation

KFIC,

Inc.

Inc.
questions regarding this

Georgetown
Any

(Cayman)

Industries,

acknowledgment

may

be directed

to the Blocked Assets Section, Office of Foreign Assets
Control, Department of the Treasury, Washington, D. C. 20220
(telephone

202-535-4026).

R. Richard

Newco

Director
Office of Foreign Assets Control

~

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 1

Com

letion of Certain Securities Transactions.
(a)

Commercial

banking

or investment

banking

to
complete, on or before August 16, 1990, irrespective of their
stated completion date, transactions entered into prior to
5:00 a. m. Eastern Daylight Time, August 2, 1990, involving
securities purchased, sold, lent, or borrowed. for the account
of the Government of Kuwait, its agencies, instrumentalities,
and controlled entities, and the Central Bank of Kuwait (the
"Government of Kuwait" ), provided the following terms and
conditions are complied with, respectively:
(1) The proceeds of such sale by, or return of
funds to, the Government of Kuwait are credited to a blocked

institutions

within the United States are hereby authorized

account in a commercial

banking

or investment

banking

institution within the United States in the name of the person
for whose account such sale or return was made; and
(2) The securities so purchased by, or lent or
returned to, the Government of Kuwait are held in a blocked
account in a commercial

banking

or investment

banking

institution within the United States in the name df the person
for whose account the purchase, borrowing, or loan was made.
(b) This section does not authorize the crediting of the
proceeds of, or funds received with respect to, Government of
Kuwait securities held in a blocked account or a sub-account,
L

DEPARTMENT OF THE TREASURY
W A 5 HI N GT ON

OFFICE OF FOREIGN ASSETS CONTROL
ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. l

KUWAIT

Com

letion of Certain Securities Transactions.
(a)

Commercial

banking

or investment

banking

to
complete, on or before August 16, 1990, irrespective of their
stated completion date, transactions entered into prior to
5:00 a. m. Eastern Daylight Time, August 2, '1990, involving
securities purchased, sold, lent, or borrowed for the account
of the Government of Kuwait, its agencies, instrumentalities,
and controlled, entities, and the Central Bank of Kuwait (the
"Government of Kuwait" ), provided the following terms and
conditions are complied with, respectively:
(1) The proceeds of such sale by, or return of
funds to, the Government of Kuwait are credited to a blocked

institutions

within

the United States are hereby authorized

account in a commercial

banking

or investment

banking

institution within the United States in the name of the person
for whose account such sale or return was made; and
(2) The securities so purchased by, or lent or
returned to, the Government of Kuwait are held in a blocked
account in a commercial

banking

or investment

banking

institution within the United States in the name df the person
for whose account the purchase, borrowing, or loan was made.
(b) This section does not authorize the crediting of the
proceeds of, or funds received with respect to, Government of
Kuwait securities held in a blocked account or a sub-account,
Nl

or securities

returned

with respect

account or sub-account,
under

any name

to

to

funds held in a blocked

a blocked account or sub-account

or designation

which

differs

from the name

of the specific blocked account or sub-account
which such funds or securities were held.
designation

Issued:

August

R. Richard

2, 1990

Newcomb

Director
Office of Foreign Assets Control

or
in

or securities returned with respect to funds held in a blocked
account or sub-account, to a blocked account or sub-account
under any name or designation which differs from the name or
designation of the specific blocked account or sub-account in
which

such funds

Issued:

August

or securities were held.
2, 1990

/

R. Richard

Newcomb

Director
Office of Foreign Assets Control

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 2

Oil Under Contract Entered Into Prior to

Route To The United

States.

Au

st

2

1990

And

Oil of Iraqi origin or oil in which the Government
Kuwait or the Government of Iraq has an interest may be
imported into the United States only if:

(a)

of

(1) prior to the effective date, the oil was loaded
for ultimate delivery to the United States on board a vessel in
Iraq, Kuwait, or a third country,
(2)

the oil is imported

into the United States

before 11:59 p. m. Eastern Daylight Time, October 1, 1990, and
(3) the bill of lading accompanying the oil was
issued prior to the effective date.
(b)

Any payment

owed

or balance not paid to or for the

benefit of the Government of Iraq or the Government of Kuwait
prior to the effective date for oil imported pursuant-. to
section (a) must be paid into a blocked account in a U. S.
financial institution.
(c) Transactions conducted pursuant to this section must
be reported in writing to the Office of Foreign Assets Control,
Blocked Assets Section within ten (10) days of the date o f
importation.

this license are defined as follows:
(1) The term "oil of Iraqi origin" shall. mean oil
extracted, processed or refined in Iraq.
(2) The term "Government of Iraq" includes:
(d) Terms used in

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 2

Oil Under Contract Entered Into prior to

States.
Oil of Iraqi origin or oil in

Route To The United

(a)

Au

st

2

1990

And

which the Government

En

of

of Iraq has an interest may be
imported into the United States only if:
(1) prior to the effective date, the oil was loaded
for ultimate delivery to the United States on board a vessel in
Iraq, Kuwait, or a third country,
(2) the oil is imported into the United States
before 11:59 p. m. Eastern Daylight Time, October 1, 1990, and
(3) the bill of lading accompanying the oil was

Kuwait

or the Government

issued prior to the effective date.
(b) Any payment owed or balance not paid to or for the

benefit of the Government of Iraq or the Government of Kuwait
prior to the effective date for oil imported pursuant-to
section (a) must be paid into a blocked account in a U. S.
financial institution.
(c) Transactions conducted pursuant to this section must
be reported in writing to the Office of Foreign Assets Control,
Blocked Assets Section within ten (10) days of the date of
importation.

this license are defined as follows:
(1) The term "oil of Iraqi origin" shall mean oj]
extracted, processed or refined in Iraq.
(2) The term "Government of Iraq" includes:
(d) Terms used in

state

of Iraq, as well as
thereof,
any political subdivision,
agency, or instrumentality
including the Central Bank of Iraq;
a) The

and

the Government

association,

b) Any partnership,

other organization

substantially

owned

or

corporation,

or controlled

the

by

foregoing;

c) Any person to the extent that such person is, or
has been, or to the extent that there is reasonable cause to
believe such person is, or has been, since the effective date,
acting or purporting to act, directly or indirectly
of any of the foregoing;
or organization

d) Any other person

behalf

determined

the Secretary of the Treasury to be included within
(~)

on

by

section

.
(3) The term "Government of Kuwait" shall mean
a) The state and the Government of Kuwait, as well

as any

political subdivision,

thereof,

including
b)

Any

other organization

agency,

or instrumentality

the Central Bank of Kuwait;

partnership,

association,

corporation,

or controlled

or

by

the

person to the extent that such person

is,

substantially

owned

foregoing;

c)
has been,

Any

or to the extent that there is reasonable

cause to

or

a) The
any

state

and

political subdivision,

including

the Central Bank

of Iraq, as well as
thereof,
agency, or instrumentality
of Iraq;
the Government

association,

b) Any partnership,

other organization

substantially

owned

corporation,

or controlled

by

or
the

foregoing;

c) Any person to the extent that such person is, or
has been, or to the extent that there is reasonable cause to
believe such person is, or has been, since the effective date,
acting or purporting to act, directly or indirectly on behalf
of any of the foregoing;
d) Any other person or organization determined by
the Secretary of the Treasury to be included within section
(~)

~

(3) The term "Government of Kuwait" shall mean
a) The state and the Government of Kuwait, as well
as any

political subdivision,

thereof,

including
b)

Any

other organization

agency,

or instrumentality

the Central Bank of Kuwait;

partnership,

association,

corporation,

or controlled

or

by

the

person to the extent that such person

is,

substantially

owned

foregoing;

c)
has been,

Any

or to the extent that there is reasonable

cause to

or

believe such person

is, or

effective date,
to act, directly or indirectly on behalf

acting or purporting
of any of the foregoing,

has been, since the

and

other person or organization determined by
the Secretary of the Treasury to be included within section
d) Any

(4) The term "effective date" shall mean 5:00

a. m.

2, 1990.
(5) The term "blocked account" shall mean an account
in a financial institution with respect to which account

Eastern Daylight

Time, August

transfers or withdrawals or other dealings may not be
or license
made or effected except pursuant to an authorization
such
from the Office of Foreign Assets Control authorizing
action.
(6) The term "U. S. financial institution" shall mean
any U. S. person engaged in the business of accepting deposits
or making, granting, transferring, holding, or brokering loans
or credits, or of purchasing or selling foreign exchange or
commodities or procuring purchasers and sellers thereof, as

payments,

principal

or agent,

savings banks,

including,

trust companies,

but not limited

to,

securities brokers

banks,
and

dealers,

believe such person

is, or

effective date,
to act, directly or indirectly on behalf

acting or purporting
of any of the foregoing,

has been, since the

and

d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within section

(1)

~

(4) The term "effective date" shall

mean

5:00 a. m.

2, 1990.
(5) The term "blocked account" shall mean an account
in a financial institution with respect to which account

Eastern Daylight

Time, August

transfers or withdrawals or other dealings may not be
or license
made or effected except pursuant to an authorization
such
from the Office of Foreign Assets Control authorizing
action.
(6) The term "U. S. financial institution" shall mean
any U. S. person engaged in the business of accepting deposits
or making, granting, transferring, holding, or brokering loans
or credits, or of purchasing or selling foreign exchange or
commodities or procuring purchasers and sellers thereof, as
payments,

principal
savings

or agent,
banks,

trust

including,
companies,

but not limited

to,

securities brokers

banks,
and

dealers,

commodities

plans,

brokers,

and holding

investment
companies

or subsidiaries

foregoing.

Issued: August 8, 1990

R. Richard

companies,

Newcomb

Director

Office of Foreign Assets Control

employee

of

any

pension

of the

commodities

plans,

brokers,

and holding

investment
companies

or subsidiaries

foregoing.

Issued: August 8, 1990

R. Richard

companies,

Newcomb

Director

Office of Foreign Assets Control

employee

of

any

pension

of the

DEPARTMENT OF THE TREASUR Y
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO.

of

Investment
Accounts.

of Kuwait

Government

3

Funds Held in Blocked

(a) U. S. financial institutions are hereby authorized
to invest and reinvest funds held in blocked accounts in the

of the
conditions:

name

Government

of Kuwait, subject to the following

(1) The proceeds of such investments and
reinvestments are credited to a blocked account or
sub-account which is in the name of the Government of Kuwait
and which is subject to the jurisdiction of the United

States;
(2) The proceeds of such investments and
reinvestments are not credited to a blocked account or

sub-account

under

any name

or designation

which

differs

from

of the specific blocked account or
sub-account in which such funds or securities were held; and
(3) no financial or economic benefit accrues. to
the Government of Iraq as a result of the transaction.
(b)(1) U. S. persons seeking to avail themselves of this
authorization must register with the Office of Foreign

the

or designation

name

Assets Control,
(2)

section

Blocked Assets Section.

Transactions

must be reported

Control,
completion

conducted

pursuant

to this

to the Office of Foreign Assets

Blocked Assets Section within

of the transaction.

ten (10) days of

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 3

KUWAIT

of

Investment
Accounts.

of Kuwait

Government

Held in Blocked

Funds

(a) U. S. financial institutions are hereby authorized
to invest and reinvest funds held in blocked accounts in the

of the
conditions:

Government

name

of Kuwait, subject to the following

(1) The proceeds of such investments and
reinvestments are credited to a blocked account or
sub-account which is in the name of the Government of Kuwait
and which is subject to the jurisdiction of the United

States;
(2) The proceeds of such investments

are not credited to a blocked account or

reinvestments

sub-account

the

name

and

under

any name

or designation

or designation

which

from

of the specific blocked account or

in which such funds or securities

sub-account

differs

were held;

and

(3) no financial or economic benefit accrues to
the Government of Iraq as a result of the transaction.
U. S. persons

(b)(1)

seeking to avail themselves

of this

register with the Office of Foreign
Assets Control, Blocked Assets Section.
(2) Transactions conducted pursuant to this
section must be reported to the Office of Foreign Assets
authorization

Control,
completion

must

Blocked Assets Section within

of the transaction.

ten (10) days of

(d) Terms used in

(1)

The term

a) The

as any political

thereof,

including
b)

Any

other organization

state

this license are def ined as follows:
"Government

of Iraq" includes:

and the Government

subdivision,

agency,

of Iraq, as well

or instrumentality

the Central Bank of Iraq;

partnership,

corporation, or
or controlled by the

association,

substantially

owned

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing;
d) Any other person or organization

determined

by

the Secretary of the Treasury to be included within section

of Kuwait" shall mean
a) The state and the Government of Kuwait, as
well as any political subdivision, agency, or
thereof, including the Central Bank of
instrumentality
(2) The term "Government

Kuwait;

(d) Terms used in

(1)

this license are defined as follows:

The term "Government

of Iraq" includes:

a) The

state

c)

person to the extent that such person

of Iraq, as well
as any political subdivision, agency, or instrumentality
thereof, including the Central Bank of Iraq;
association, corporation, or
b) Any partnership,
other organization substantially owned or controlled by the
and the Government

foregoing;
Any

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing;
d) Any other person or organization

determined

by

the Secretary of the Treasury to be included within section

of Kuwait" shall mean
a) The state and the Government of Kuwait, as
well as any political subdivision, agency, or
thereof, including the Central Bank of
instrumentality
(2) The term "Government

Kuwait;

b)

Any

other organization

association, corporation, or
substantially owned or controlled by the

partnership,

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing, and
d) Any other person or organization determined by
the Secretary of the Treasury to be included within section
(3) The term "blocked account" shall mean an
account in the United States with respect to which account

transfers or withdrawals or other dealings may not
be made or effected except pursuant to an authorization
or
license from the Office of Foreign Assets Control
authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or making, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling

payments,

foreign exchange or commodities or procuring purchasers and
sellers thereof, as principal or agent, including, but, not

limited to, banks, savings banks, trust companies,

b)

Any

other organization

association, corporation, or
substantially owned or controlled by the

partnership,

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing,
d) Any other p'erson

and

or organization

determined

by

the Secretary of the Treasury to be included within section
(3) The term "blocked account" shall mean an
account in the United States with respect to which account

transfers or withdrawals or other dealings may not
be made or effected except pursuant to an authorization
or
license from the Office of Foreign Assets Control
authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or making, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling

payments,

foreign exchange or commodities or procuring purchasers and
sellers thereof, as principal or agent, including, but not

limited to, banks, savings banks, trust companies,

securities brokers
investment

companies,

dealers, commodities
employee

or subsidiaries

companies

Issued:

and

August

R. Richard

of

pension plans,
any

8, 1990

Newcomb

Director
Office of Foreign Assets Control

brokers,
and holding

of the foregoing.

securities brokers
investment

companies,

dealers, commodities
employee

or subsidiaries

companies

Issued:

and

August

R. Richard

of

pension plans,
any

8, 1990

Newcomb

Director
Office of Foreign Assets Control

brokers,
and holding

of the foregoing.

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 4

Transactions
Government

b

U. S.

of Kuwait.

Entities

Owned

or Controlled

the

b

(a) The following transactions by a U. S. financial
institution that is not owned or controlled by the
Government

of

Kuwait

are hereby authorized

with respect to

of entities

or

blocked accounts held in the

name

controlled

of Kuwait that are located

by the Government

owned

the United States:

within

(1)
or transfer

Any payment

from outside

or transfer,

including

any payment

the United States, into such

blocked accounts;

(2)

Any payment

or transfer

from such blocked

that no benefit accrues to the Government
of Iraq from such transactions.
(b)(1) Entities owned or controlled by the Government
of Kuwait, seeking to avail themselves of this
authorization, must register with the Office of Foreign
Assets Control, Blocked Assets Section.
(2) Financial institutions must require evidence
of such registration before undertaking any transaction
accounts,

provided

to this license.
(c) Terms used in this license are defined as follows:

pursuant

(1)

The term "Government

of Iraq" includes:

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO.

Transactions
Government

U. S.

b

of Kuwait.

Entities

Owned

4

or Controlled

b

the

(a) The following transactions by a U. S. financial
institution that is not owned or controlled by the
Government

of

Kuwait

are hereby authorized

blocked accounts held in the

with respect to

of entities owned or
of Kuwait that are located

name

controlled by the Government
within the United States:
(1) Any payment or transfer, including any payment
or transfer from outside the United States, into such
blocked accounts;

(2)

Any payment

or transfer

from such blocked

that no benefit accrues to the Government
of Iraq from such transactions.
(b)(1) Entities owned or controlled by the Government
of Kuwait, seeking to avail themselves of this
authorization, must register with the Office of Foreign

accounts,

provided

Assets Control,

Blocked Assets Section.

(2) Financial

of such registration

institutions

must

before undertaking

require evidence

any

transaction

to this license.
(c) Terms used in this license are defined as follows:
(1) The term "Government of Iraq" includes:

pursuant

a) The state and the Government

as any political

thereof,

subdivision,

including
b)

Any

other organization

agency,

of Iraq, as well

or instrumentality

the Central Bank of Iraq;

partnership,

association,

substantially

owned

or

corporation,

or controlled

by the

foregoing;

c)

Any

person

to the extent that

is,

such person

or has been, or to the extent that there is reasonable

cause

to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing;
d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within section
(2) The term "Government

of Kuwait" shall

state and the Government of
political subdivision, agency, or

a) The

well as any

instrumentality

thereof,

including

mean

Kuwait,

as

the Central Bank of

Kuwait;

b)

Any

other organization

partnership,

substantially

association,
owned

corporation, or
or controlled by the

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective

date, acting or purporting to act, directly or indirectly
behalf of any of the foregoing, and

on

a) The state and the Government

of Iraq, as well
as any political subdivision, agency, or instrumentality
thereof, including the Central Bank of Iraq;
association, corporation, or
b) Any partnership,
other organization substantially owned or controlled by the
foregoing;
c) Any person to the extent that such person is,
or has been, or to the extent that there is reasonable cause

to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing;
d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within section

of Kuwait" shall mean
a) The state and the Government of Kuwait, as
well as any political subdivision, agency, or
thereof, including the Central Bank of
instrumentality
(2) The term "Government

Kuwait;

b)

Any

other organization

association, corporation, or
substantially owned or controlled by the

partnership,

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective

date, acting or purporting to act, directly or indirectly
behalf of any of the foregoing, and

on

or organization

d) Any other person

determined

by

the Secretary of the Treasury to be included within

section

(1).
(3)

The term "blocked account"

shall

mean

an

institution with respect to which
account payments, transfers, or withdrawals or other
dealings may not be made or effected except pursuant to an
authorization or license from the Office of Foreign Assets
Control authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or making, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling

account in a financial

foreign exchange or commodities

or procuring

purchasers

and

sellers thereof, as principal or agent, including, but not
limited to, banks, savings banks, trust companies,
securities brokers and dealers, commodities brokers,
investment
companies

companies,

employee

or subsidiaries

of

pension plans,
any

Issued August 8, 1990

R. Richard

Newcomb

Director
Office of Foreign Assets Control

and holding

of the foregoing.

d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within

section

(1).
(3)

The term "blocked account"

shall

mean

an

account in a financial

institution with respect to which
account payments, transfers, or withdrawals or other
dealings may not be made or effected except pursuant to an
authorization or license from the Office of Foreign Assets
Control authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or making, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling
foreign exchange or commodities

or procuring

purchasers

and

sellers thereof, as principal or agent, including, but not
limited to, banks, savings banks, trust companies,
securities brokers and dealers, commodities brokers,
investment
companies

companies,

employee

or subsidiaries

of

pension plans,
any

Issued August 8, 1990

R. Richard

Newcomb

Director
Office of Foreign Assets Control

and holding

of the foregoing.

o

Ipartmeni of the Treasury ~ Washington,
D=. .

FOR IMMEDIATE

ii; OF ihE

iiiEA~,

RELEASE

D.C. ~ Telephone 566-24

)e(ONTACT
ACT.

0
Office
of Financing

202/376-4350

RESULTS OF TREASURY'S AUCTION

OF 30-YEAR BONDS

be issued
for $10, 256 million of 30-year bonds to were
2020
15, 1990 and to mature on August 15,

Tenders
on August

accepted today (CUSIP: 912810EG9).
The interest rate on the bonds will be 8 3/44. The range
of accepted bids, and the corresponding prices at the 8 3/44
interest rate are as follows:

Price
98. 851
Low
98. 644
High
98. 747
Average
Tenders at the high yield were allotted 13o.
Yield

8. 86%
8. 88%
8. 874

TENDERS RECEIVED AND ACCEPTED

(in Thousands)

Location
Boston
New

York

Philadelphia
Cleveland

Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas

San Francisco

Treasury

ted
2, 800
159
790,
9,

Received
2, 800
24, 179, 936
1, 899
6, 201
13, 913

6, 504

~Acce

1, 899

3, 201
7, 303
6, 004

1, 195, 903
11,237.
12, 880
9, 494
9, 811

504, 230
397
$25I955, 205

346, 803
11 237

1, 880

8, 494
4, 311
71, 525
397

$10, 256, 013
TOTALS
includes $505
The $10, 256 million of accepted tenders
of
million
751
and $9,
million of noncompetitive tenders
competitive tenders from the public.
of tenders accepted in
In addition to the $10, 256 million
was awarded at the
tenders
$0 million of
the auction process,
for foreign and
agents
average price to Federal Reserve BanksAn asadditional $200
international monetary authorities.
at the average price from
million of tenders was also accepted
exchange for
Federal Reserve Banks for their own account in
maturing

securities.

The minimum par amount required
Larger amounts must be in multiples

for STRIPS is $160, 000.
of that amount.

department

of the Treasury

washington,
D. PT. 0 F
E 8 EA 5 ': '
~

-".

FOR IMMEDIATE

August

Ti-i

D.C. ~ Telephone SOS-24

't

CONTACT:

RELEASE

Office of Financing
202/376-4350

9, 1990
RESULTS OF TREASURY'S AUCTION

OF 30-YEAR BONDS

for $10, 256 million of 30-year bonds to be issued
15, 1990 and to mature on August, 15, 2020 were

Tenders
on August

accepted today (CUSIP: 912810EG9).

interest rate on the bonds will be 8 3/44. The range
of accepted bids, and the corresponding prices at the 8 3/44
interest rate are as follows:
The

Price

Yield
Low

High

Average

Tenders

at the

8. 864
8. 884
8. 874

high yield were

98. 851
98. 644
98. 747
allotted 13~.

TENDERS RECEIVED AND ACCEPTED

(in Thousands)

Location

Boston
New

York

Philadelphia
Cleveland

Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas
San Francisco
Treasury
TOTALS

ted
Ance
2, 800

Received
2, 800
936
179,
24,
1, 899
6, 201
13, 913

9, 790, 159
1, 899
3, 201
7, 303
6, 004

6, 504
1, 195, 903

11,237.
12, 880
9, 494
9, 811

504, 230

397
$25/955/205

346, 803
11/237

1, 880

8, 494
4, 311
71, 525

397
$10, 256, 013

includes $505
$10, 256 million of accepted tenders million
of
751
and
$9,
tenders
million of noncompetitive
public.
the
competitive tenders from
accepted in
In addition to the $10, 256 million of tenders awarded
at the
was
tenders
of
$0 million
the auction process,
and
for
foreign
as
agents
Banks
average price to Federal Reserve
additional
$200
An
international monetary authorities.
million of tenders was also accepted at the average price from
Federal Reserve Banks for their own account in exchange for
The

maturing

securities.

The minimum par amount required
Larger amounts must be in multiples

for STRIPS is $160, ppp.
of that amount.

3. L'4A. ~11 I
~

Ail

I

'&Q

.I

jpartmeni of the Treasury ~ Nashlngfoy~o.

FOR IMMEDIATE

c. ~

Contact:

RELEASE

August

Telephone S66-204

Larry Batdorf
566-2041

TREASURY ANNOUNCES BANK SECRECY ACT CIVIL
PENALTY AGAINST NATIONAL BANK OF WASHINGTON

of the Treasury announced that a civil penalty of
$368, 000 had been assessed against The National Bank of
Washington, Washington, D. C. , prior to the closing of the bank by
the Comptroller of the Currency and the appointment of the FDIC
as receiver.
The penalty was based upon the bank's failure to
file Currency Transaction Reports as required by the Bank Secrecy
Act. The majority of the violations arose from a Federal
undercover money laundering operation involving the bank.
Former
Senior Vice President, Roger C. Schultz, pleaded guilty to Bank
Secrecy Act violations in 1988. Other violations occurred
because the bank improperly exempted customers from the currency
The bank previously had been cited by
reporting requirements.
Treasury for similar exemption violations arising from these
violations in 1986. The amount assessed was the maximum penalty
authorized for these violations.
The Department

Assistant

Secretary Peter
by Treasury
and the involvement
of its former senior vice president in money
laundering, NBW continued to rely on a woefully inadequate Bank
Secrecy Act compliance program which led to a number of
violations and created a situation ripe for money laundering. "
The

penalty

K. Nunez.

was announced
Nunez stated:

by Treasury
"Despite an

earlier

warning

of the Bank Secrecy Act, 31
financial institutions are
required to file reports with Treasury for currency transactions
conducted by, through, or to the institution in excess of
$10, 000.

Under the reporting requirements
U. S. C. 5311-5326, banks and other

NB-918

department

of the Treasury

FOR IMMEDIATE

~ lSeshkngaoy~y.

RELEASE

August

Contact:

c. ~

Telephone 566-204$

Larry Batdorf
566-2041

TREASURY ANNOUNCES BANK SECRECY ACT CIVIL
PENALTY AGAINST NATIONAL BANK OF WASHINGTON

of the Treasury announced that a civil penalty of
$368, 000 had been assessed against The National Bank of
Washington, Washington, D. C. , prior to the closing of the bank by
the Comptroller of the Currency and the appointment of the FDIC
as receiver.
The penalty was based upon the bank's failure to
file Currency Transaction Reports as required by the Bank Secrecy
Act. The majority of the violations arose from a Federal
undercover money laundering operation involving the bank.
Former
Senior Vice President, Roger C. Schultz, pleaded guilty to Bank
Secrecy Act violations in 1988. Other violations occurred
because the bank improperly exempted customers from the currency
The bank previously had been cited by
reporting requirements.
Treasury for similar exemption violations arising from these
violations in 1986 The amount assessed was the maximum penalty
authorized for these violations.
The penalty was announced by Treasury Assistant Secretary Peter
"Despite an earlier warning by Treasury
Nunez stated:
K. Nunez.
of its former senior vice president in money
and the involvement
laundering, NBW continued to rely on a woefully inadequate Bank
Secrecy Act compliance program which led to a number of
violations and created a situation ripe for money laundering. "
The Department

of the Bank Secrecy Act, 31
financial institutions are
for currency transactions
with
Treasury
file
reports
required to
in excess of
institution
conducted by, through, or to the
$10, 000.

requirements
Under the reporting
U. S.C. 5311-5326, banks and other

NB-918

]

Q

Ql»

c

I 4i~ca

THE mrrTZ

HOUSE

Office of the Press Secretary
For Immediate

Release

August

10, 1990

EXEcUTZVE ORDER

12274
BLOCKZNC

IRAQI GOVERNMENT

PROPERTY

AND

PROHIBITING

TRANSACTIONS

wXTH

ZRAQ

By the authority vested in me as President by the
Constitution and laws of the United States of America,
the International Emergency Economic Powers Act (50 U. S.including
C. 1701
~et ee . ), the National
Enettenniee Act (50 U. e. c. 1601 et 55m. ) .
section 301 of title 3 of the United States CoCo, and the
United Nations Participation Act (22 U. S.C. 287c), in view of
United Nations Security Council Reeclution Nc. 661 of August 6,
1990, and in order to take additional steps with respect to
Iraq's invasion of Kuwait and the national emergency
declared
in Executive Order No. 12722,
Z, GEORGE BUSH,

hereby order:

President

of the United States of America,

Except to the extent provided in regulations
that may hereafter be issued pursuant to this order, all
property and interests in property oi the Government of zzaq
that are in the United States, that hereafter come within the
United States, oz that are or hereafter come within the
possession or control of United States parsons, including
their oversaaS branches, are hereby blOCked.
The following are prohibited,
except to the extent
provided in regulations that may hereafter be issued pursuant to
this order:
(a) The importation into the United States of any goods or
services of Iraqi origin, or any activity that promotes or is
intended to promote such importation;
(b) The exportation to Iraq, or to any entity operated
from Iraq, or owned or controlled by the Government of Iraq,
i directly of any goods, technology (including
'cal data or other information), or services either
(ii) requiring the issuance of
i te d St a t es, or or
i from the Un Fe
any activity that promotes
era ag
agency,
a license by a p deral
except donatio ns of
exportation,
such
promote
to
s intended
such as food and
suffering,
human
elieve
o
r
t
d
intende
articles
medical
purposes;
for
i in t enndada strictly
supplies
bY a United States person related to
c Any dealing
after August 6,
of Iraqi origin exported from Iraq fzcm
Iraq to arly
4ed for exportation
or any
country
from
any
to
Iraq
ortation
or e
is
intended to promote
or
promotes
that
a
n
4
k
any
of
activity
such dealing]
to
ansaction by a United States person relatingalien
resident
permanent
or
citfsen
travel by ny activities sby any su
to
er than gransacgions necessary to
the date cf this order, 0other.
more

THE WHITE HOUSE

Office of tho Press Secretary
Far Zmmediato

Release

August

10, 1990

EXECUTIVE ORDER

12274
BLOCKZNC

ZRAQZ

GOVERNMENT

PROPERTY

AND

PROHIBITING TRANSACTIONS

WITH IRAQ

By the authority vested in me as President by the
Constitution and laws of the United States of America, including
the International Emergency Economic Powers Act (S0 U. S.C. 1701
~et ae . ), the National Enetcenciee act (50 U. a. c. 1601 nt ann. j,
section 301 of title 3 af the United States Code, and the
United Nations Participation Act (22 U. S.C. 287c), in view of
United Nations Security Council Resolutian No. 661 of August 6,
1990, and in order to take additional steps with respect to
Zraq's invasion of Kuwait and the national emergency declared
in Executive Order No. 12722,

I,

GEORGE BUSH,

hereby order:

of the United States af Amezica,

President

~&~i~. Except to tha extant provided in regulations
that may hezeafter be issued pursuant to this order, all
property and interests in property af the Government ai Iraq
that are in the United States, that horoaftoz' come within the
United States, or that are or hereafter come within the
possession or control of United States persons, including
their overseas branches, are hereby blocked.
except ta the extent
The following are prahibited,
hereafter
be
issued pursuant ti
that
regulations
may
pzovided in
this order:
(a) The importation into tho United States of any goods o;
services of Iraqi origin, or any activity that promotes or is
intended to promote such importation;
to any entity opezated
(b) The exportation to Iraq, or tha
Government of Iraq,
contzolled
by
or
from Iraq, or awned
(including
of'
technology
goods,
any
indirectly,
directly or
or sazvices either
technical data or ather information), requiring
the issuance of
States, or (ii)
i from the United
activity
that pzomates
or
any
agency
deral
era
Fe
F
a license by a
donations ai
except
expoztation,
such
or is intends d t o promote
as food an d
such
suffering,
human
relieve
to
articles inten d e d
6

supplies

intended

strictly

f' or

medical purposes;

dealing by a United States person related to
exported from Iraq after August 6,
of Iraqi origin
'
from Iraq to any
t dedto for exportatian
or any
country,
from
any
Iraq
or exportation
d
intend
to pzo ote
is
or
promotes
that
a.
k nd
activity of any ki
such dealing]
relating t
transaction by a United States person
alia
resident
permanent
or
any United States citizen
Any

travel

by

er. than transaogions
the date of this order, o ther.
more

necessary to

effect (i) such parson's departure from Iraqi (ii) travel
activities ior tha conduct oi the official business oi
or the

and

United Nations, or (iii) travel ior
Federal Government
Journalistic activity by persons regularly employed in such
capacity by a news-gathering organisation;
(e) Any transaction by a United States person relating to
transportation to or from Iraq; the provision oi transportation
to or from the United States by any Iraqi person oz any vessel
oz airczaft of Iraqi registration;
or tha sale in tha
United States by any person holding authority under the Federal
Aviation Act of 1958, as amended (49 U, S.C. 1301
), of
any tzansportation
by air that includes any stop in Iraq/

g~~.

(f) The performance by any United States person of any
contract, including a financing contract, in support of an
industrial, commezcial, public utility, or governmental pro]ect
in Iraq~

(g) Except as otherwise authorized herein, any commitment
or transfer, direct or indirect, of funds, or other financial or
~ conomic resources by any United states person to tha Government
of Iraq or any other parson in Iraq;
(h) Any transaction by any United States person that
evades oz' avoids, or has tha purpose of evading or avoiding,
set forth in this ordez.
any oi the prohibitions

of this order:
person" means any
(a) the term "United States resident
alien, )uridical
United States citizen, permanent
States (including
United
the
of
laws
the
under
person organized
fozeign branches), or any person in the United States, and
vessels of U. S. registration.
the Government
(b) the term "Government ot Iraq" includes
controlled
and
instrumentalities
agencies,
of Iraq, its
of Iraq.
For purposes

entities,

and

the Central Bank
This order

is effective

immediately,

The Secretary of the Treasury, in consultationsuch
to take
of State, is hereby authorised
Secretary
with the
aa
regulations,
and
rules
of
actions, including the promulgation
Such
order.
of
this
carry out the purposes
prohibiting or regulating payments orthe
include
actiohs may
or any transactions involvingStates
transfers of any property economic
value by any United
of
transfer of anything
or
Iraq, or to any Iraqi national
on to the Government of directly
the
or indirectly, by
ad or controlled,
f
The Secreta
z I a i nationale
officer
other
to
functions
these
f
the
oC
All agencies
of the Federal Government.
measure
appropriate
all
take
nt are directed to
arry out tha provisions of this
authozi
y
within their
or te na on o
din the suspension
i'n
ac aas of the date of this ord
er authorizations i e iieet
oother
1990, is
Executive Order No. 12722 of August 2,
licenses, and other
re lations, orders,
issued or otherwise taka
d
revoked administrative
not
Grdar No, ],2722 and
this order until
under
effect
e
remain in-Cull force an d

shall

moz'

~

ef fect (i) such Person ' s departure from Iraq,
(ii) travel and
activf, ties for the conduct of the official
business
of
Federal Government or the United Nations, or
(iii) travelthe for
Journalistic activity by persons regularly employed
in such
capacity by a news-gathering organisation;
(e) Any transaction
a United States pez'son relating
to
transportation to or fz'om by
Iraqi
provision oi transportat, ion
to or from the United States by the
person oz any vessel
or aizcraft of Zraqi registration;any orIraqi
the sale in the
United States by any person halding authority
under the Federal
Aviation Act of 1958, as amended (49 U S.C. 1301
), of
any transportation
by air that includes any atop in
Iraqi
(f) The performance by
United States person of any
contzact, including a financingany contract,
support of an
industzial, commercial, public utility, or ingovernmental
project
in Iraqi

a~g.

(g)

Except as otherwise

eCOnOmiC

of Zraq

authozized

any commitment
direct or indirect, of funds, herein,
or other financial or
ZeSOurCeS by any United StateS perSOn ta the Government
oz' any other

or transfer,

person in Iraq;

(h) Any transaction by any United States pezson that
evades or avoids, or haa the purpose of evading or avoiding,
any of the

set forth in this ordez.
For purposes of this ozder:

prohibitions

Qg~.

(a) the term "United States person" means any
United States citizen, permanent resident alien, )uridical
person organized undez' the laws of the United States (including
fozeign branches), or any person in the United States, and

vessels of
(b)

of Iraq,

entities,

U. S.

registration.

the term "Government of Zz'aq" includes the Government
agencies, instrumentalities
and controlled
and the Central Bank of Iraq.

its

This order

is effective

immediately.

The Secretary of the Treasury, in consultation
with the Secretary of State, is hezeby authorized to take such
actions, including the promulgation of rules and regulations, as
Such
may be necessary to carry out the purposes of this order.
actiohs may include prohibiting oz regulating payments or
transfers of any property or any transactions involving the
transfer of anything of economic value by any United States
person ta the Government of Iraq, or to any Iraqi natianal or

or controlled, directly or indiz'ectly, by the
of Iraq or Iraqi nationale. The Secretary of the
Tzeasury may redelegate any of these functions to other officers
All agencies of the
and agencies of the Federal Government.
take
all
to
directed
apprapziate measures
are
Government
Federal
within their autharity to carry out the provisians of this
of licenses or
order, including the suspension or oftermination
the
date
this order.
oi
as
effect
in
authazisatians
other
Executive order Na. 12722 af August 2, 1990, is
All
ta ths extent inconsistent with this order.
revoked
hezeby
other
and
licenses,
orders,
les regulations,
action made, issued, or otherwise taken
f orms of administz'ative
and not revoked administratively
No
. 127 2 2 effect
dez
Oz
ive
'undez Execut
under this ozdez until
force and
u
shall rema n i n .full

entity

owned

Government

maz'e

modified,

or terminated by proper authority.
The
provision of Executive Order
No. 12722
pursuant to this section shall not affect
any violation of
any rules, regulations,
orders,
or other forms of
administrative action under that licenses,
during the period
that such provision of that order order
was in effect.
This order shall be transmitted to the
Congress
amended,

revocation

of

any

and

GEORGE BUSH

THE WHITE HOUSE&

August

9, 1990.

mo4iiied, or terminate4 by proper authority.
The
revocation of any provision of Executive Order No. 12722
pursuant to this section shall not affect any violation oi
orders, licenses, or other forms of
any rules, regulations,
administrative action under that order during the period
that such provision of that order was in effect.
This order shall be transmitted to the congress and
published in the Fe
amended,

GEORGE BUBH

THE WHITE HOUSE&

August

9&

l990

~

THE WHITE HOUSE

office of the Press Secretary
For Immediate

Release

august

lO, 1990

EXECUTIVE ORDER

12275
BLOCKING KUWAZTI

PROHZBITING

GOV19QOCENT

PROPERTY

AND

TRANSACTIONS

WITH KUWAIT

By the authority vested in me as President hy the
Constitution and laws of tha United States of America,
the Zntarnational Emergency Economic Powers Act (50 U. S.including
the National Emergencies Act (50 U. S.C. 1601 C. 1701
),
),
section 301 of title 3 of the Unftid States Code, and the
United Nations Participation Act (22 U. s. C. 287c), in view of
United Nations Security CounCf l Resolution No. 661 of August 6,
l990, and in order to take additional steps with respect to
Zzagis invasion of Kuwait an4 the national emergency declared
fn Executive Order No. l2722,

~~.

~~@.

I,

GEORGE BUSH,

hereby order:

President

of the United States of America,

Except to the extent provided in regulations
that may hereafter be issua4 pursuant to this order, all
property ah4 interests in property of tha Government of Kuwait
that are in the Unite4 States, that hereafter coma within the
Unftod states, or that ara or hereafter come within the
possessfon or control of United States persons, including
their overseas branches, are blocked.
except to tha extent
Tha following are prohibited,
provided in regulations that may hereafter be issued pursuant to
this order:
(a) The importation into the United States of any goods or
services of Kuwaiti origin, or any' activity that promotes or fs
intended to promote such importation;
to Kuwait, or to any entity operated
(p) The exportation controlle4
hy the Government of Kuwait,
wnad or
technology (inclu ing
goods,
of
any
indirectly,
oz
directly
or services either
information),
other
technical data or
h U ftad States I or (if) requiring the issuance of
any activity that promotes
a license by a Federal agency, or
except, donations of
exportatfoni
such
promote
to
4 4
such as food and
suffering,
relieve human
articles inten d e4 to
purposes~
medical
for
e strictly
t ded
supplies anton
States person related to
Any dealing hy a United
from Kuwait after August, 6,
exported
ro ezt of I(uwaftf origin f or exportation
fred. K"Mait t~
intended
or zo arty
or any
from
country,
any
or@ation to Kuwait
o
intended
is
to
or
romotes
i 4 thata prom
activity of any kin
such 4ealing;
ralatfng to
transaction hy a United States person
alien
resident
itixen or permanent
St t
o
such
per
ft'
any
i ties byy an
to Kuwait, or to activ
than tzansactions necessary
o
i or d er, other
data of this

after the

mora
(OVER)

THE WHITE HOUSE

Office of the Press Secretary
For Immediate

Release

August

10, 1990

EXECUTIVE OanER

12275
BLOCKING KUWAITZ
PROHIBZTZNG

GO&9QiMBPZ'

PROPERTY

AND

TRANSACTXONS

WITH KUWAZT

By the authority vested in ma as President
by the
Constitution an4 laws of tha United
States
of
America,
inclu4ing
the Znternational Emergency Economic Powers Act
(S0
U.
S.
the
~g~g. ),
National Emergencies Act (50 U. S.C. 1601 C. 1701
~URN. ),
section 301 of title 3 of the United States
and the
United Nations Participation Act (22 U. S.C. Code,
287c), in view of
United Nations Security Counoil Resolution No.
of August 6,
1990, and in ozder to take additional steps with661
respect to
Iraq's invasion of Kuwait an4 the national emergency
declared
in Executive Order No. 12722,

I,

GEORGE BUSH,

hereby order:

President

of the United States of America,

Except to the extent provided in
that may hereafter be issue4 pursuant to this order,regulations
all
property and interests in property of tha Goveznment of Kuwait
that are in the United States, that hereafter coma within tha
United states, or that ara or hereaftez come within the
possession or control of United States parsons, including
their overseas branches, are blocked.
Tha following are prohibited,
except to the extent
provide4 in regulations that may hereafter be issued pursuant to

this order:

(a) The importation into the United States of any goods or
services of Kuwaiti ozigin, or any' activity that promotes or is
intended to promote such importation;
(p) The exportation to Kuwait, or to any entity operated
owned or controlled by the Government of Kuwait,
(incluudin
ing
directly or indirectly, of any goods, technology
technical data or other information), or services either
fzom the United States, or (ii) reguiring the issuance of
a license by a Federal agency, or any activity that. promotes
such exportation, except donations of
i 4 d to pzomote
such as food an 4
human suffering,
relieve
articles intends4 4 to
medical
purposesg
for
strictly
d
e
4
inten
supplies
Any dealing by a United States person zelated to

arty intended f oz exportation fzom. Ki»ait t~
rtation to Kuwait from any countzy, or any
z'omotes or is intended to promote
activity of any kind that promo
dealing;
such
transaction by a United States person relating to
itixen or permanent resident alien
St t
it'
any such person within Kuwait,
i
byy an
to Kuwait, or to activities
than transactions necessazy
other
o
d
order,
this
after the data ot
zo

more
(OVER)

to effect (i) such person&s d parture from
Kuwait, (ii) tz'avel
activities i th e
o the official business of the
Federal Goveznmont or thconduct,
ited Nations, or (iii) travel for
)ournalisti c acti vx t y by p orsons
reg larly
and

capacity

(a)

transaction

Any

o oz

e

ait of

h y a U nited St
rom Kuvait
the pz'o
n ted States b an

Kuwaiti
i

zogistr tion

i

on z'ol

p

ion of tz'
oz'

h
y any pezson hold ing authority under
as amended (49 U. S.C ~ 1301
any transportation
by air th at i ncludes
1 d
any stop

a

es

t

y
ommerc

in such

employed

a newsews-ga th ering organizationl

by'

s

po

g

the Federal
'e

in Kuvaitg

y

nited State

al, public utility, or

pe so

governmental

pro]oct

(g) Except as otherwise
herein, any commitmont
or transfer, direct or indizect,authorized
of
funds,
or other financial or
economic resources by any United states person
to the Government
of Kuvait or any oCher pozson in Kuwait;
(h) Any tz'ansaction by any United States
that
evades oz avoids, or has the purpose of evading person
or avoiding,

any

of the prohibitions

set forth in this order.
For purposes of this order:

(a) the term "United States person" means any
United States citizen, permanent resident alien, )uridical
pezson organized under the laws of the United States (including
foreign branches), or any person in the United States, and

vessels of

U. S.

registration.

tho term "Government of Kuvait" includes the
of Kuvait or any entity purporting to be the
of Kuwait, its agencies, instrumentalities
and
contz oiled entitios, and the Central Bank of Kuwait.
(b)

Government
Government

This order

is effective

immediately.

S. The Secretary of tho Treasury, in consultation
vith the Secretary of State, is hereby authorized to take such
actions, including the promulgation of ~ules and regulations, as
Such
may be necessary to caz'ry out the purposes of this order.
actions may include prohibiting or regulating payments or
transfezs of any property or anY transactions involving the
tzansfez of anything of economic value by any United States
person to tho Government of Kuvait, or to any Kuwaiti national
or entity owned or controlled, directly or indirectly, by the
The secretary of the
Goveznmont of' Kuvait or Kuvaiti nationale.
Treasury may redelegate any of these functions to other officers
All agencies of
and agencies of the Federal Government.
take
all
to
directed
are
appropriate measures
Government
Fedezal
within their authority to carry out the provisions of this
of licenses or
order, including the suspension or termination
the
date
of
as
ot
this order.
effect
in
authorizations
other
Executive Order No. 12723 of August 2, 1990, is
to the extent inconsistent with this ordez. All
revoked
hereby
licenses, and other
ogations, rules, regulations, orders,
issued,
or otherwise taken
made,
action
forms of administrative
revoked
not
administratively
and
No.
12723
Order
under Executive
under
effect
this
order until
and
force
full
in
n
rema
shall
h 11 remain

~S~,

more

to effect (i) such personts
p rture from Kuwait,
(if) travel
and aotivities for the cond
of
the
official
business
of the
Fodezal Government or t„en
Nations, or (fff) travel foz
journalistic activ't Y b Y Parsons re
larl eemployed in such
regularlY

capacity

by a news-

th orfng oz'ganfzation;

nY transaction
b y a U nited States person zolatfng to
( )
transportation t o or from Kuwait
n ted States b an
vessel or aircraft of Kuwaitf
i zo gistration; or the sale fn the
es y any person hold
uthority under the Federal
as amended (49 U. S AC. 1301
any transportation
by air th a t i ncludes
1 4 any stop in Kuwait;

ontz
in us

(f)

r

The yerformance

t i

clud'n

a
a , commercial

ite
public utility, or
b

an

U

governmental

project

(g) Except as otherwise authorized herein, any commitmont
or transfer, direct or indirect, of funds, or other financial or
economic resources by any United States yorson to the Government
of Kuwait or any other person in Kuwait;
(h) Any transaction by any United States pezson that
evades or avoids, or has the purpose of evading or avoiding,
any

set forth in this order.
For purposes of this order:

of the prohibitions

(a) the term "United States person" means any
United States citizen, permanent resident alien, juridical
pezson organized under the laws of the United States (including
foreign bzanches), or any person in the United States, and

vessels of

U. S.

registration.

tho term "Government of Kuwait" includes the
Government of Kuwait or any entity purportfnq to be the
and
Government of Kuwait, its agencies, instrumentalities
Kuwait.
Bank
of
central
the
and
contzolled entitios,
(b)

This order

is effective

immediately.

Secretary of tho Treasury, in consultationsuch
authorized to take
with the Secretary of State, is hereby
rules and regulations, as
of
promulgation
the
actions, including
of this order- Such
purposes
the
may be necessary to carry out
regulating
payments or
or
actions may include prohibiting
involvfng the
transactions
oz'
any
property
transfers of any
States
United
any
value
bY
of economic
transfer of anything
to
any Kuwaiti national
or
Kuwait,
of
Government
person to the
directly or indirectly, by tho the
or entity owned or controlled,
The secretary of
nationale.
Kuwaiti
Government of Kuwait or
functions
to other officers
any of these
Treasury may redelegate
of the
All
agencies
Government.
and agencies of the Federal
measures
all
appropriate
take
to
directe4
are
Federal Government
o'f this
provisions
tho
out
to carry
wfthfn their authorfty suspension
or termination of licenses or
the
order, including
as of the date oi this o ~er.
other authorizations in effect
August 2, 1990 ' is
Executive Order No. 12'723 of with
this or4er. AII
extent inconsistent
ereby revoke4 to theregulations,
and other
f
1
censes,
orders
rules,
f se taken
otherw
delegationsadministrative
or
issued,
made
action
administratively
f orms o f
revoked
No. 12723 and not
under Executive ardez' force and effect under this order until
full
shall remain in
The

&

moze

amended,

modified,

oz terminated
revocation of any provision
by proper authority.
The
of Executive
pursuant to this section
No. 12723
shall not affect order
any rules, regulations,
any violation of
orders, licenses, or
administrative action under
forms of
that such provision of that that order during other
the period
order was in effect.
This order shall be
transmitted to the congress
published in the
and
s

CEORQE BUSH

THE WHITE HOUSE&

August

9, 1990.

modified, or terminated by proper authority.
The
revocation of any provision of Executive order No. 12723
pursuant to this section shall not affect any violation of
any rules, regulations,
orders, licenses, or other forms of
administrative action under that order during the period
that such provision of that order was in effect.
This order shall be transmitted to the Congress and
amended,

GEORGE BUSH

THE WHITE HOUSE,

August

9, 1990.

DEPARTMENT OF THE TREASURY
WASHINGTON

AU6

12 1990

Patrikis:
letter to you of

Dear Mr.

August 5, 1990, I set forth the status
my
of various banks under Executive Order No. 12723. Since
that date we have received additional information concerning
certain banks listed in Category II of that letter regarding
their ownership and control. Based on the information we
have received, we have determined that the following banks
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,
1990:
Bahrain Middle East Bank
Dao Heng Bank
Gulf International
BankBank of Bahrain and Kuwait

In

Kuwait

French Bank

National Bank of Kuwait
Swiss Kuwaiti Bank

American Bank
Bank of Kuwait

UBAF Arab

United
We

have determined

with those

included

that the following

listed in Category

bank should
IV
e. ,

(i.

be

blocked):

Estate Bank
We will complete
our review of the status of the remaining
The fact that we have yet to
bank in Category II shortly.
complete our review of this bank should not be viewed as an
indication that its (not-blocked) status will change.
Kuwait Real

Richard

Newcomb

Director
Office of Foreign Assets Control
Ernest T. Patrikis

General

Counsel

and

Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New

York,

New

York

10045

DEPARTMENT OF THE TREASURY.
WASHINGTON

AU6

12'1980

Patrikis:
letter to you of

Dear Mr.

August 5, 1990, I set forth the status
under
Executive Order No. 12723. Since
banks
various
of
that date we have received additional information concerning
certain banks listed in Category II of that letter regarding
their ownership and control. Based on the information we
have received, we have determined that the following banks
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,

In

my

1990:

Bahrain Middle East Bank
Dao Heng Bank

BankGulf International
Bank of Bahrain and Kuwait
Kuwait French Bank
National Bank of Kuwait
Swiss Kuwaiti Bank
UBAF Arab

American

Bank

United Bank of Kuwait

We

have determined

with those

included

that the following

listed

bank should
e. ,
in Category IV

(i.

be

blocked):

Estate Bank
We will complete
our review of the status of the remaining
The fact that we have yet to
bank in Category II shortly.
should not be viewed as an
bank
this
complete our review of
indication that its (not-blocked) status will change.
Kuwait Real

Sincerely,
Richard

Newcomb

Director
Office of Foreign Assets Control
Ernest T. Patrikis

General

Counsel

and

Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New

York,

New

York

10045

KUWAIT/IRAQ
INFORMATION

PACKET

KUWAI

T/

I NFORMAT I ON

I RAQ
PACKET

EXECUTIVE ORDER

l

BLOCKING IRAQI GOVERNS:NT PROPERTY
AND P ROHI B IT I NG TRANSACT I ON 5 WITH IRAQ

the authority

By

vested in

me

as President

by the

itution and laws of the United States of America, including
the International Emergency Economic Powers-Act (50 U. S.C. 1701
seq. ), the National Emergencies Act (5(T U. S.C. 1601 et seq. ),
and section 301 of title 3 of the United States Code.
I, GEORGE BUSH, President of the United States of America,
find that the policies and actions of the Government of Iraq
constitute an unusual and extraordinary threat to the national
security and foreign policy of the United States and hereby
declare a national emergency to deal with that threat.
I hereby order:
Section 1. All property and interests in property of the
Government of Iraq, its agencies, instrumentalities
and
controlled entities and the Central Bank of Iraq that are in the
United States, that hereafter come within the United States or
that are or hereafter come within the possession or control of
United States persons, including their overseas branches, are

Cons

-

he eby

blocked.

Section 2. The following are prohibited, except to the
extent provided in regulations which may hereafte be issued

pursuant

to this Order:

into the United States of any goods or
services of Iraqi origin, other than publications and other
informational materials;
(b) The export to Iraq of any goods, technology (including
technical data or other information controlled for export
Ac- (50 U. S. C.
pursuant to Section 5 of the Export Administration
States,
excep
United
the
App. 2404) ) or services from
publications and'other informational materials, and donations of
articles intended to relieve human suffering, such as food,for
clothing, medicine and medical supplies intended strictly
medical purposes;
(c) Any transaction by a United States person relating to
transport, ation to or from Iraq; the provision of transportation
to or from the United States by any Iraqi person or any vessel o
in the United States
aircraft of Iraqi registration; or the salefederal
Aviation Ac cf
by any person holding authority under the
1958, as amended (49 U. S.C. 1514), of any transportation by a'which includes any stop in Iraq;
(a)

The import

EXECUTIVE ORDER

BLOCKING

IRAQI GOVERNMi:NT PROPERTY
PROHIBITING TRANSACTIONS WITH IRAQ

AND

By

the authority

vested in

me

as President

by the

Cons itution and laws of the United States of America, including
the International Emergency Economic Powers -Act (50 U. S.C. 1'701
seq. ), the National Emergencies Act (50 U. S.C. 1601 et seq ),
and section 301 of title 3 of the United States Code
I, GEORGE BUSH, President of the United States of America,
find that the policies and actions of the Government of Iraq
constitute an unusual and extraordinary threat to the national
security and foreign policy of the United States and hereby
declare a national emergency to deal with that threat.
I hereby order:
Section 1. All property and interests in property of the
Government of Iraq, its agencies, instrumentalities
and
controlled entities and the Central Bank of Iraq that are in the
United States, that hereafter come within the United States or
that are or hereafter come within the possession or control of
United States persons, including their overseas branches, are
-

he eby

blocked.

Section 2. The following
extent provided in regulations
pursuant to this Order:

are prohibited, except to the
hereafte be issued

which may

(a) The import into the United States of any goods or
services of Iraqi origin, other than publications and othe
informational materials;
(b) The export to Iraq of any goods, technology (including
technical data or other information controlled for export
Ac- (50 U. S. C.
pursuant to Section 5 of the Export Administration
App. 2404)) or services from the United States, excep
publications and other informational materials, and donations o f
articles intended to relieve human suffering, such as food,for
clothing, medicine and medical supplies intended strictly
'

medical purposes;

(c) Any transaction by a United States person relating to
transportation to or from Iraq; the provision of transportation
to or from the United States by any Iraqi person or any vessel o
in the United States
aircraft of Iraqi registration; or the saleP'ederal
Aviation 'Ac of
the
under
authority
by any person holding
1958, as amended (49 U. S.C. 1514), of any transportation by a' "
which includes any stop in Iraq;

(d) The purchase by any United
export from Iraq to any country;

(e)

States pe son of goods fo

The Pe formance by any United
of an indus-rial or

contract in support

governmental

project in Iraq;

States person of
other

comme

cial

any

oz

(f) The grant o extension of credits or loans by any
States person to the Government of Iraq, its
instrumentalities
and controlled entities;
(g) Any transaction by a United States person relating to
travel by any United States citizen or permanent resident
al'en
to Iraq, or to activities by any such pe son within Iraq, after
the date of this Order, other than transactions necessary to
effect such pe son's departure from Iraq, or travel for
journalistic activity by persons regularly employed in such
capacity by a newsgathering organization; and
(h) Any transaction by any United States person which
evades oz avoids, or has the purpose of evading or avoiding, any
of the pzohib'tions set forth in this Order.
For purposes of this Order, the term "United States person"
means any United States citizen, permanent
resident alien,
juridical person organized under the laws of the United States,

United

0

or any person in the United States.

Section 3. This Order is effective immediately.
Section 4. The Secretary of the Treasury, in consultation
with the Secretary of State, is hereby authorized to take sucn
actions, including the p omulgation of rules and regulations, as
of this Ozde . Such
may be necessary to carry out the purposes
actions may include prohibiting or regulating payments or
tzansfe s of any p ope ty or any transactions involving the
t ansfer of anything of economic value by any United States
and
pe son to the Government of Iraq, its instrumentalities
controlled entities, or to any Iraqi national or entity owned o
controlled, directly o ind» ectly, by Iraq or Iraqi nat'onals.
. The Sec etary may redelegate any of these functions to other
office s and acenc'es of the Federal gove nment. All agencies of
the United Sta es government a e directed to. take all appropriate
measures within their authority to carry out the provisions of
this Order, including the suspension or termination of licenses
in effect as of the date of this Ozdez.
or other authorizations
This Order shall be transmitted
published in the Federal Register.

TH" NHITF. HOUSc. ,

August

2, 1990

to the Congress

and

(d) The purchase by any United
export from Iraq to any country;

States person of goods for

The pe formance by any United
of an indus- rial or

contract in support

governmental

project in Iraq;

States pe"son of any
other comme cia 1 or

The grant o extension of cred' ts or loans
( f)
ted States pe son to the Government o f Iraq, its,
and controlled entities;
instrumentalities

Un

'

by any

(g) Any transaction by a United States. person relating to
travel by any United States citizen or permanent resident al'en
to Iraq, or to activities by any such pe son within Iraq, after
the date of this Order, other than transactions necessary to
effect such person's departure from Iraq, oz travel for

journalistic

capacity

activity

by persons

by a newsgathering

regularly employed
organization; and

in such

transaction by any United States person which
or has the purpose of evading oz avoiding, any
prohib'tions
of the
set forth in this Order.
For pu poses of th's Order, the term "United States person"
means any United States citizen, permanent
resident alien,
under
the laws of the United States,
juridical person organized
evades

(h)

Any

oz avoids,

or any person in the United States.

Section

3.

This Order

Section 4.

is effective

immediately.

Secretary of the Treasury, in consultation
of State, is hereby authorized to take sucn
actions, including the promulgation of rules and regulations, as
of this Orde . Such
may be necessary to carry out the purposes
actions may include prohibiting or regulating payments or
transfers of any property or any transactions involving the
by any United S-ates
t ansfer of anything of economic value instrumentalities
and
pe son to the Government of Iraq, its
controlled entities, or to any Iraqi national or entity owned o"
controlled, d' rectly or ind» ectly, by Iraq or Iraqi nat' onals.
.The Sec etary may redelegate any of these functions to other
officers and acenc'es of the Federal gove nment. All agencies of
the United Sta es government a e directed to. take all appropriate
measures within their authority to carry out the provisions o
this 0 der, including the suspension or termination of licenses
in effect as of the date of this Order.
or other authorizations
This Order shall be transmitted to the Congress and
published in the Federal Register.
The

with the Secretary

TE

Wi! I TZ HOUSc.

August

2, l990

,

EXECUTIV~ ORDER
1

BLOCKING KUNAITI

2

7 2
GQVr

3

~NT

PROPERTY

the authority vested in me as President by the
Constitution and lans of the United States of America, includinc
International Emeraency Economic Powers Act (50 U. S. C. 1701
sea. ), the National Emeraencies Act (50 U. S.C. 1601 et sec.
),
and 3 U. S.C. 301.
By

I, GEORGE BUSH, President of the" UnMed States, find that
situation
caused by the invasion of Kuwait by Irac
the
cons itutes an unusual and extraordinary threat to the national
security, foreicn policy and economy of the United States and
have declared a. national emeraency to deal with that threat.
I he eby order blocked all property and inte ests in
prope ty of the Gove nment of Kuwait or any entity purportinc to
be the Gove nment of Kuwait, its agencies, 'instrumentalities
and
controlled entities and the Central Bank of Kuwait that are 'n
the United States, that hereafter come within the Un'ted States
or tha are or hereafter come within the possession o control of
- United States persons, including their overseas branches.
For purposes of th' s Order, the term "United States person"
means any United States c'titan, permanent resident alien,
ju idical person orcan'zed under the lars of the Un'ted State o
any person in the United States.
The Secretary of the Treasu y is author'zed to e. ploy
Emercencv Econom' c
po~e s cranted to 'me by the International
Powers Ac to ca, y ou the provisions of this Order.
Th's Order is effective immed'ately and shall be tr-nsm'tted
to the Concress and published in the Federal Reciste
.

T&.

NH

TE HOUSE,

Aucust 2, 1990

EXECUTIVE ORDER
1

BLOCKING

KUWAI T

2

I

7 2

3

GOVc. RNY:. NT P ROP ERT Y

vested in me as President by the
By the authority
Constitution and laws of the United States of America, including
the International
Emergency Economic Powers Act (50 U. S. C. 1701
sea. ), the National Emezgencies Act (50 U. S.C. 1601 et sec.
),
and 3 U. S.C. 301.

President of the'UnWed States, find that
caused by the invasion of Kuwait by Irac
cons itutes an unusual and extraordinary threat to the national
security, foreign policy and economy of the United States and
have declared. a, national emergency to deal with that threat.
GEORGE BUSH,

the situation

I

order blocked all property and inte ests in
the
of
Gove nment of Kuwait or any entity purporting
prope ty
to
be the Cove nment of Kuwait, its agencies, 'instrumentalities
and
controlled entities and the Central Bank of Kuwait that aze 'n
the United States, that hereafter come within the Un'ted Staies
oz thai are or hereafte" come with'n the possession oz control of
United States persons, including. their overseas branches.
For purposes of th's Order, the term "United States person"
means any United States citizen, pe~'anent resident alien,
ju idical person organized under the laws of the United State o
any pe son in the United Staies.
The Secretary of the Treasu y is authorized to e. ploy
Emergency Econom'c
powe s granted to 'me by the'International
Powers Ac to car y . ou the provisions of this Order.
This O dez is effective immediately and shall be trans-, .' ted
to the Congress and published in the Federal Reciste
he eby

.

TE:.

WE

Augus

TE HOUSE,

2, 1990

DEPARTMENT OF THE TREASURY

BACKGROUND BRIEFING

ON FOREIGN ASSETS CONTROL

August

2, 1990

BREWS?RAÃSCNP?5', INC.
N. W. , Suite SOO
8'ashington, D. C. 2M05

1333 0 Streei,

DEPARTMIENT OF THE TREASURY

BACKGROUND BRIEFING

ON FOREIGN ASSETS CONTROL

August

2, 1990

hEWS 7RAÃSCNP?S, 1ÃC.
1333 Street, ht. W. , Sttite 500
Washington, D. C. 20005

0

BACKGROUND)

BRIEFING - August 2, 199g

MODERATOR: (Name deletecD, would you want to open with just a little background

on-

TREASURY OFFICIAL: Yes, I can. I'm as much interested in what's of interest to you. I
didn't prepare a talk to give to you; it's unrehearsed. I thought we could sit and chatMODERATOR: Why don't we start with questions.

TREASURY OFFICIAL: -make this in the format of Qs and As. Let me just give you maybe
overvie~ of what Foreign Assets Control is, what we do, and what these programs are.
minute
a one
Foreign Assets Control is the agency within the Treasury department responsible for
administrative, and enforcement of economic sanctions and embargo programs as
implementation,
ordered by the president, and declared by the Congress under specific statutes. We operate under the
Trading with the Enemy Act, for example, the International Emergency Economic Powers Act, as is
in the case here. We also administer the Comprehensive Anti-Apartheid Act.
We deal in embargoes a8'ecting South A&ice under the Comprehensive Anti-Apartheid Act,
Libya under International Emergency Economic Powers Act, Cuba, Vietnam, North Korea, Cambodia.
We did the Panama program, we did the Nicaragua program. And we have a long history of other
programs. We did the Iran assets &eeze in 1979. We did assets &eezes and trade embargoes against
the Japanese, for example, in 1941, against the Axis powers, China, and so forth. So we are the
embargo program once.
The president, this morning, signed two executive orders. One was concerning the blocking of
Iraqi government property and prohibiting transactions with Iraq. As far as the blocking is concernedI'm going to follow, fairly closely, the executive order here-but the property and interests in property
of Iraq in the United States, or that it comes into the United States hereafter, or that comes within
the possession or control of a United States person„ including their overseas branches are blocked.
In addition, there's a trade embargo aspect. Imports into the United States of goods or services
of Iraqi origin, exports to Iraq of any goods, technology, are prohibited. Transactions relating to
transportation, purchase of goods, or brokering by a U.S. person on behalf of Iraq. They' re pretty well
laid out here. It is a fairly fu11 and complete economic and trade embargo, modeling, or very similar
to what we have ~ith Libya.
Q: I have a question about there's rice, U. S. rice being loaded on a ahip for Iraq, right now,
under the GSM 102 program, and the fact that that's already like on the water, being loaded for, you
know, near term, in transit. Is that blocked or is that loading finish and. go?

TREASURY OFFICIAL: Let me say, when these-in this particular case, we get literally
hundreds of questions like that, questions relating to oil imports, questions relating to ownership and
control-a whole range of questions that we normally get. And we' re compiling all of those questions
lilac.
and we' ll be dealing with them. And we contemplate issuing mgulations where those kinds of
questions will be dealt with.
I d5'n't have an answer for you right now. I don't know all the facts and circun~ces. There
may be a lot of technical counter questions that I have, but I am certain the person you heard it &om
eventually be in touch with someone on our !tan', and we will get an answer.
I'

hKWS 7R4h5CRIPTS,

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Bh CKGROUND BRIEFING - hugust 2, 199g

MODERATOR: (Name deleted), would you want to open with just a little background

on-

TREASURY OFFICIAL: Yes, I can. I'm as much interested in what's of interest to you.
didn't prepare a talk to give to you; it's unrehearsed
I thought we could sit and chat-

I

MODERATOR: Why don't we start with questions.

TREASURY OFFICIAL: -make this in the format of Qs and As. Let me just give you maybe
a one minute overvie~ of what Foreign Assets Control is, what we do, and what these programs sre.
Foreign Assets Control is the agency within the Treasury department responsible for
administrative, and enforcement of economic sanctions and embargo programs as
implementation,
ordered by the president, and declared by the Congress under specific statutes. We operate under the
Trading with the Enemy Act, for example, the International Emergency Economic Powers Act, as is
in the case here. We also administer the Comprehensive Anti-Apartheid Act.
We deal in embargoes sff'ecting South A&ics under the Comprehensive Anti-Apartheid Act,
Libya under International Emergency Economic Powers Act, Cuba, Vietnam, North Korea, Cambodia.
We did the Panama program, we did the Nicaragua program. And we have a long history of other
programs. We did the Iran assets &eeze in 1979. We did assets &eezes and trade embargoes against
the Japanese, for example, in 1941, against the Axis powers, China, and so forth. So we are the
embargo program office.
The president, this morning, signed two executive orders. One was concerning the blocking of
Iraqi government property and prohibiting transactions with Iraq. As far as the blocking is concernedI'm going to follow, fairly closely, the executive order here-but the property and interests in property
of Iraq in the United States, or that it comes into the United States hereafter, or that comes within
the possession or control of a United States person, including their overseas branches are blocked.
In addition, there's a trade embargo aspect. Imports into the United States of goods or services
of Iraqi origin, exports to Iraq of any goods, technology, are prohibited. Transactions relating to
transportation, purchase of goods, or brokering by a U. S. person on behalf of Iraq. They' re pretty well
laid out here. It is a fairly full and complete economic and trade embargo, modeling, or very similar
to what we have with Libya.
Q: I have a question about there's rice, U. S. rice being loaded on a ship for Iraq, right now,
under the GSM 102 program, and the fact that that's already like on the ~ster, being loaded for, you
know, near term, in transit. Is that blocked or is that loading 6nish and go?

TREASURY OFFICIAL: Let me say, when these-in this particular case, we get literally
hundreds of questions like that, questions relating to oil imports, questions relating to ownership and
control-a whole range of questions that we normally get. And we' re compiling all of those questions
And we contemplate issuing regulations where those kinds of
and we' ll be dealing with them
questions will be dealt with.
I d5'n't have an answer for you right now. I don't know aH the facts and circumstances. There
msy be s lot of technical counter questions that I have, but I am certain the person you heard it from
eventually be in touch with someone on our std', snd we will get an answer.
I'

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1%6

Q: How fast can you move, in other words?

I guess

we' re wondering.

TREASURY OFFICIAL: Move what? To get an answer?
Q: No. To breeze assets, to stop oil shipments, that kind of thing. What's the time frame we' re
tallting about?

TREASURY OFFICIAL: It's been done,
Q: So if you' ve got a tanker that's a mile

oF New York City,

what happens to it& Is it coming

TREASURY OFFICIAL: Well, that gets into a question of territorial waters. Let's say you' ve
got an oil tanker at a dock, or let's say you' ve got something that's unloading. Is it Libyan, I would-or
is it Iraqi? Excuse me.
MODERATOR:

Every time he says Libyan he means Iraq.

TREASURY OFFICIAL: It's been a long night and(Laughter)
Q: When did you first get involved in this?

TREASURY OFFICIAL: Let me just say I think that's a question you might direct somewhere
else. I don't know. Is that inMODERATOR:- He's been up inost of the night.

Q: I just want to ask the question-is what you' re saying is seizing the assets?

TREASURY OFFICIAL: I didn't say we' re seizing the assets.
Q: Freezing.

TREASURY OFFICI"AL: Freezing, yes.
Q: Okay, just so I understand this. If there s an oil tanker that s coming in &0m Iraq and it' s
got Iraqi oil on it, would that be seized or ~ould that stu8' already be under contract and sold to
somebody here in (inaudible)?

TREASURY OFFICIAL: It wouldn't be seized; it's blocked And the import
According to the plain
services, if they' re of Iraqi origin, ~ould be prohibited.
States
of
of
Iraqi
goods
executive order, import into the United
oriel are prohibited
be imported. Let's assume they' re here. They' re blocked. Now, blocking" is a term

of these goods or
language of the
So they couldn' t
of art some~hat

BACKGROUND BRIEFING - August 2, 155g

Q: How fast can you move, in other words?

I guess

we' re wondering.

TREASURY OFFICIAL: Move what? To get an answer?
Q: No. To breeze assets, to stop oil shipments, that kind of thing. What's the time kame we' re
talking about?

TREASURY OFFICIAL: It's been done.
Q: So if you' ve got a tanker that's a mile oF New York City, what happens to it& Is it coming
in?

TREASURY OFFICIAL: Well, that gets into a question of territorial
got an oil tanker at a dock, or let's say you' ve got something that's unloading.
is it Iraqi? Excuse me.
MODERATOR:

w aters.

Let's say you' ve

Is it Libyan, I would-wr

Every time he says Libyan he means Iraq.

TREASURY OFFICIAL: It's been a long night and(Laughter)
Q: When did you first get involved in this?

TREASURY OFFICIAL: Let me just say I think that's a question you might direct somewhere
else. I don't know. Is that inMODERATOR:- He's been up most of the night.

Q: I just want to ask the question-is what you' re saying is seizing the assets?

TREASURY OFFICIAL: I didn't say we' re seizing the assets.
Q: Freezing.

TREASURY OFF ICZAL: Freexing, yes.
Q: Okay, just so I understand this. If there's an oil tanker that's coming in &om Iraq and it' s
got Iraqi oil on it, would that be seized or ~ould that stu8' already be under contract and sold to
somebody here in (inaudible)?

TREASURY OFFICIAL: It wouldn't be seized; it's blocked And the import of these goods or
According to the plain language of the
services, if they' re of Iraqi origin, would be prohibited.
executive order, import into the United States of goods of Iraqi origin are prohibited. So they couldn' t
be imported. Let's assume they' re here. They' re blocked. Now, blocking" is a term of art somewhat

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unique to our program-it doesn't mean they' re seized, it doesn't mean they' re forfeited; they are
essentially &ozen in place. It could be a bank account, tangible property; it could be goods; it can be
securities-it can be a whole range of things. I think the best model ae far as a blocking or a &eeze
program you might look at for some kind of historical feel might be the Iran hostage crisis in 1979,
because that wae clearly a blocking which had a big dollar value. But I don't want to compare this
particular program necessarily to Iran; it's closer to the program (inaudible).

Q: Are all imports &om Iraq stopped now because of this order?

TREASURY OFFICIAL: Yes.
Q: So there's no more oil coming into this country &om Iraq?
seventh supplier?

We' ve cut o8' our number

TREASURY OFFICIAL: As I say, it's in the executive order.
Q: Kuwait oil-Kuwaiti oil also?

TREASURY OFFICIAL: Let me go into the Kuwait situation. We' re working closely with the
government of Kuwait. This is not something that we did in the same vein, it wae something done in
more of a protecting vein so that people who might have an interest in seizing or taking or getting
their hands on whatever, they could not do that if it wae within United States jurisdiction, within the
possession or control of U. S. persons, including their overseas branches.
Q: Does that mean that oil coming in from Kuwait ie being held, too?

TREASURY OFFICIAL: It'e not an import embargo.

It's more a bank account (inaudible)?
TREASURY OFFICIAL: It's an assete freeze. I think these are the kinds of things with
Kuwait that very rapidly we want to address and work out in conjunction with the &iendly
goverTunent.

Q: But on Iraq, it's a blocking of imports. Can I go back to my other question-like if we were
loading rice for Iraq and, &om what your explanation wae, that we' re stopping ties, does that mean
that if it's going to Iraq, we would block that now, too, because that ~ould be a U.S. export to Iraq?

TREASURY OFFICIAL: The export would be prohibited. We wouldn't block in that sense,
unless it was Iraqi-titled property; we wouldn't block it, we'd just prohibit the export.
Q: Like perhaps if we were giving U.S. grain, specifically wheat, to Iraq, if we don't know
exactly whose title it's already in but it wae under a GSM 102 program, that means that

TREASURY OFFICIAL: That doesn't deal with the question

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goes to the question

Bh CKGROUND BRIEFING - August 2, 199g

program-it

doesn't mean they' re seized, it doesn't mean they' re forfeited; they are
unique to our
essentially frozen in place. It could be a bank account, tangible property; it could be goods; it can be
securities-it can be a ~hole range of things. I think the best model as far as a blocking or a &eeze
program you might look at for some kind of historical feel might be the Iran hostage crisis in 1979,
because that wae clearly a blocking which had a big dollar value. But I don't want to compare this
particular program necessarily to Iran; it's closer to the program (inaudible).

Q: Are all imports &om Iraq stopped now because of this order?

TREASURY OFFICIAL: Yes.
Q;

So there's no more oil coming into this country &om Iraq? We' ve cut o8' our number

seventh supplier?

TREASURY OFFICIAL: As I say, it's in the executive order.
Q: Kuwait oil-Kuwaiti oil also?

TREASURY OFFICIAL: Let me go into the Kuwait situation. We' re working closely with the
government of Kuwait. This is not something that we did in the same vein; it was something done in
more of a protecting vein so that people who might have an interest in seizing or taking or getting
their hands on whatever, they could not do that if it was within United States jurisdiction, within the
possession or control of U. S. persons, including their overseas branches.
Q: Does that mean that oil coming in &om Kuwait is being held, too?

TREASURY OFFICIAL: It'e not an import embargo.
Q: It'e more a bank account (inaudible)?

TREASURY OFFICIAL: It's an assete &eeze. I think these are the kinds of things with
Kuwait that very rapidly we want to address and work out in cozjunction with the friendly
government.

Q: But on Iraq, it's a blocking of imports. Can I go back to my other question-like if we were
loading rice for Iraq and, &om what your explanation was, that we' re stopping ties, does that mean
that if it's going to Iraq, we would block that now, too, because that would be a U.S. export to Iraq?

TREASURY OFFICIAL: The export would be prohibited. We wouldn't bloclr, in
unlese it was Iraqi-titled property; we wouldn't block it, we'd just prohibit the export.
were giving U. S. grain, specifically wheat, to Iraq, if we don't kno~
exactly whose title it's already in but it was under a GSM 102 program„ that means that

Q: Like perhaps

if we

TREASURY OFFICIAL: That doesn't deal with the question cf title; it goes to the question

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of ~here it's going,

if'

19Ã

there's an intent, you know, to export it to Iraq

Q: So then that would be blocked.

TREASURY OFFICIAL: Or an intent to (inaudible). Not blocked-prohibited
Blocked" is a
technical term of art meaning you hold in place by way of freezing, prohibiting the transfer, in other
words, it just remains where it is-money remains in a bank account, securities in securities accountsihat kind of thing, they remain.
Q: But if it's a U.S. good trying to go to Iraq, it's not blocked; it's prohibited from being
exported there. It still can move-I mean, it can go to another country or somewhere else in the United

States.
words,

TREASURY OFFICIAL: Let me just get another little wrinkle on this. If it is Iraq-in other
if Iraq came and bought it in the United States, then in that situation it ~ould be blocked.
Q: So essentially

it's an asset block and a trade embargo, to put it in the purest-

TREASURY OFFICIAL: Right.
Q: %'hat did you sav?

TREASURY OFFICIAL: An assets freezeQ: An asset f'reeze and

a-

TREASURY OFFICIAL: Trade embargo.
Q: Now, the question has been asked a few times-I'm still unclear as to the answer.
about goods which have already been contracted but not yet delivered?

What

TREASURY OFFICIAL: Let me say, those are among the series of'issues we' re Mung a look
at. And when these programs develop or are developed-there's a ~hole range of those kinds of
questions, and I have my staF working with people that call; we have crisis teams set up to deal with
that. We are working under the mode that everyone who calls our oKces will get a return phone call
that day, And I can't tell gob right now what the answer to that question will be. That's a policy
question, and I think what we need to do is aweigh the practicalities of that, as we' ve done in other
And there are several different models to look at, and I think it depends on political
programs.
determination. I think there's a lot of'weighing of' pros and cons, and we will be teeing up those issues
and addressing those kinds of questions.
BQ I can't give you an answer right now.
Q: In the past there has been-

TREASURY OFFICIAL: In the past there has been-the best example I can give you there is

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of where it's going, if there's an intent, you know, to export it to Iraq.
Q: So then that would be blocked.

Blocked" is a
TREASURY OFFICIAL: Or an intent to (inaudible). Not blocked-prohibited
technical term of art meaning you hold in place by way of &eexing, prohibiting the transfer, in other
words, it just remains where it is-money remains in a bank account, securities in securities accountsthat kind of thing, they remain.
Q: But if it's a U.S. good trying to go to Iraq, it's not blocked; it's prohibited &om being
exported there. It still can move-I mean, it can go to another country or somewhere else in the United
States.

TREASURY OFFICIAL: Let me just get another little wrinkle on this. If it is Iraq-in other
words, if Iraq came and bought it in the United States, then in that situation it would be blocked.
Q: So essentially

it's an asset block and a trade embargo, to put it in the purest-

TREASURY OFFICIAL: Right.
Q: What did you sav?

TREASURY OFFICIAL: An assets &eezeQ: An asset freeze and

a-

TREASURY OFFICIAL: Trade embargo.
Q: Now, the question has been asked a few times-I'm still unclear as to the answer.
about goods which have already been contracted but not yet delivered?

What

TREASURY OFFICIAL: Let me say, those are among the series of issues we' re talking a look
at. And when these programs develop or are developed-there's a whole range of those kinds of
questions, and I have my sta8' working with people that call; we have crisis teams set up to deal with
that. We are working under the mode that everyone who calls our oKces will get a return phone call
that day. And I can't tell y'oO right now what the answer to that question will be. That's a policy
question, and I think what we need to do is weigh the practicalities of that, as we' ve done in other
And there are several de'erent models to look at, and I think it depends on political
programs.
determination. I think there's a lot of ~eighing of pros and cons, and we will be teeing up those issues
and addressing those kinds of questions.
B@I can't give you an answer right now.
Q: In the past there has been-

TREASURY OFFICIAL: In the past there has been-the best example I can give you there is

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in the 1987, the October 29th, 1987, embargo against Iran. There was s goods-in-transit exception, and
there was a contract sanctity provision. That ~ould be in the Federal Register on or about October
29th, 1987. If you want to take a look at it, you can see how it hss been handled. But I don't really
know the answer to your question.
Q: So that's something you could do, though, a goods-in-transit

exception

TREASURY OFFICIAL: It's conceivable.
Q: That's a policy option.
Q: Right. And who makes that decision?

TREASURY OFFICIAL: This is a program of the president's, and it is a decision that will be
between me and him.

made somewhere

Q: That will be like an announcement,
either (inaudible).

then-you announce, you would say goods in transit are

TREASURY OFFICIAL: Let me say, working with the client community is one of our highest
priorities. We did the Panama embargo, and we met very routinely with the aff'ected communities,
and we endeavored to meet with every party that has a concern, we make notations of their concern,
we factor it into policy decision papers. And we see that these concerns get addressed. We' re the
implementation, administration, and enforcement office. And we certainly might have views on the
policy. But these are larger-these are fairly significant policies.
Q: How long until these sorts of questions are addressed as a rule of thumb? Is that guessable
at this point?

TREASURY OFFICIAL: I think it's too early to even imnsrd, other than I can give you the
assurance we will be working as nearly around the clock as we can to try to get those questions tee'd
up and into the right hands; I mean, as much as humanly possible. We certainly unde~md and have
a great deal of appreciation for people who msy be afFected by this. We routinely work with the U.S.
business community, with aff'ected parties, and we welcome their views. And they do make them
known to us. And, again, the Pansies program was a situation thatQ: How long did that take to clarif'y those-I mean, a matter of days, hours?

TREASURY OFFICIAL: In Pammm-well, Pazmna-you see, it's hard to compare one program
to another, because each program is diEerent in one respect or another, they' re tailored to the
individmd. conditions that exist. The Pamuna program was essentially designed to do something that
was very diff'erent.

Q: Will the import ban be extended to Kuwait if they start trying to sell-if Iraq starts trying
to sell the Kuwaiti oil?

Bh CKGROUND BRIEFING - August 2, I5yg

in the 1987, the October 29th, 1987, embargo against Iran. There was a goods-in. trazudt exception,
there was a contract sanctity provision. That would be in the Federal Register on or about October
29th, 1987. If you want to take a look at it, you can see how it has been handled. But I don't really
know the answer to your question.

Q: So that's something you could do, though, a goods-in-transit

exception.

TREASURY OFFICIAL: It's conceivable.
Q: That's a policy option.
Q: Right. And who makes that decision?

TREASURY OFFICIAL: This is a program of the president's, and it is a decision that will be
made somewhere between me and him.
Q: That will be like an announcement,
either (inaudible).

then-you announce, you would say goods in transit are

TREASURY OFFICIAL: Let me say, ~orking with the client community is one of our highest
priorities. We did the Panama embargo, and we met very routinely with the affected communities,
and we endeavored to meet with every party that has a concern, we make notations of their concern,
we factor it into policy decision papers. And we see that these concerns get addressed. We' re the
implementation, administration, and enforcement once. And we certainly might have views on the
policy. But these are larger-these are fairly significant policies.
Q: How long until these sorts of questions are addressed as a rule of thumb?
at this point?

Is that guessable

TREASURY OFFICIAL: I think it's too early to even hazard, other than I can give you the
assurance we will be working as nearly around the clock as we can to try to get those questions tee'd
up and into the right hands; I mean, as much as humanly possible. We certainly understand and have
a great deal of appreciation for people who may be affected by this. We routinely work with the U.S.
business community, with affected parties, and we welcome their views. And they do make them
known to us. And, again, ihe Panama program was a situation ihatQ: How long did that take io cleric those-I mean, a matter of days, hours?

TREASURY OFFICIAL: In Pammm-. well, Pansies-you see, it's hard to compare one program
io another, because each program is different in one respect or another, they' re tailored io the
individusf conditions that exist. The Panama program was essentially designed io do something that
was very different.
Q: WiD the import ban be extended to Kuwait if they start trying io sell-if Iraq Ntarts trying
to seQ ihe Kuwaiti oil?

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TREASURY OFFICIAL: I don't think I'm in a position to hazard a guess on that. You might
I am. What I can really tell you about is what we' ve got in &ont of us. take
this
and
thst's my job, to
implement it.
be in as good s position as

Q: Well, based on that, did you discuss how much oil this is going to knock out of the domestic
market, how much is this going to hurt us?

TREASURY OFFICIAL:

I can' t-I don't

care to comment on it, as

I say.

Q: Who's the appropriate people to ask that question to? (Inaudible).
Q: One more along these lines-were these papers drawn up a few days ago when these troops
started massing on the border?

TREASURY OFFICIAL: I think you need to talk to very senior policy officials. I think you
need to talk to very senior policy officials about that. I'm not the appropriate person to even address
that question.
Q: Do you have any ball park figure as to the dollar amount of assets that msy be involved

here?

TREASURY OFFICIAL: We' re working with our staff to try to determine those figures; we' re
working with the U. S. financial community; we' ve utilized the Federal Reserve System's notification
procedures to notify all affected parties as far as the bank deposit side. As time proceeds, we' re gaining
a more complete and more accurate picture on that. Of course, in the Kuwait situation we' ll have the
cooperation of the government of Kuwait, so that will probably be a little easier.
Q: You can't give us even a sestwf-the-pants
roughly what their assets are in (inaudible)?

estimate on the Kuwait and Iraqi (inaudible),

TREASURY OFFICIAL: Let me-I can guess, but
mean, we could do a pool.
Q:

I have

I think

every one of you can guess, too;

I

no idea.

TREASURY OFFICIAL: Okay, I have an educated guess, but I think it ~ould really mislead
the wire service readers if' at this early stage I even tried to hazard a guess.

the

Q: Can you quantify it in terms of Iran? We hsd more extensive dealings with Iran back in
ho~e crisis time. Is it relatively comparable to that, far below that?

TREASURY OFFICIAL'. Let me just say that I believe it's significant, and it just really would
be premature of me to speculate. It wouldn't be fair to all of you.

BACKGROUND BRIEFING - August 2,

1990

TREASURY OFFICIAL: I don't think I'm in a position to hazard a guess on that. You might
as good a position as I am. What I can really tell you about is what we' ve got in Eront of usthat's my job, to take this and implement it.
Q: Well, based on that, did you discuss how much oil this is going to knock out of the domestic
market, how much is this going to hurt us?

TREASURY OFFICIAL:

I can' t-I don't

care to comment on it, as

I say.

Q: Who's the appropriate people to ask that question to? (Inaudible).
Q: One more along these lines-were these papers drawn up a few days ago when these troops
started massing on the border?

TREASURY OFFICIAL: I think you need to talk to very senior policy officials. I think you
need to talk to very senior policy officials about that. I'm not the appropriate person to even address
that question.
Q: Do you have any ball park figure as to the dollar amount of assets that may be involved

here?

TREASURY OFFICIAL: We' re ~orking with our staff to try to determine those figures; we' re
~orking with the U. S. financial community; we' ve utilized the Federal Reserve System's notification
procedures to notify all affected parties as far as the bank deposit side. As time proceeds, we' re gaining
a more complete and more accurate picture on that. Of course, in the Kuwait situation we' ll have the
cooperation of the government of Kuwait, so that will probably be a little easier.
Q: You can't give us even a seatcf the-pants estimate on the Kuwait and Iraqi (inaudible),
roughly what their assets are in (inaudible)?

TREASURY OFFICIAL: Let me-I can guess, but I think every one of you can guess, too; I
mean, we could do a pool.

Q:

I have

no idea.

TREASURY OFFICIAL: Okay, I have an educated guess, but I think it ~ould really mislead
the wire service readers if at this early stage I even tried to hazard a guess.
Q: Can you quantif'y it in terms of Iran? We had more extensive dealings with Iran back in
the hostage crisis time. Is it relatively comparable to that, far below that?

TREASURY OFFICIAL: Let me just say that I believe it's significant, and it just maUy would
be premature of me to speculate. It wouldn't be fair to all of you.

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BA CKGROUlVD BRIEFING

- August 2, 1556

Q: Is there any evidence-if they' ve been planning this for a long time, they obviously expect
happen.
to

TREASURY OFFICIAL: (inaudible)?
Q: Any evidence that they' ve drawn down cash in this country in the past few days, weeks?

TREASURY OFFICIAL: Once again I got to say it's too early to even guess on that. We' re
still getting it together. I mean I think some of the first important steps we needed to take we have
done, namely is to get the crisis group together, notUy as many a8'ected parties as we can, get the word
out, meet with folks like you, get together. These are ve~ good questions and they' re very important
questions.

But just don't haveQ: What are the penalties for violating?

TREASURY OFFICIAL: Criminal penalties for violating sanctions range up to 12 years in
prison, $500, 000 in corporate, $250, 000 in individual fines. Civil penalties of up to $10,000 per
violation may be imposed administratively.
Q: Civil what?

TREASURY OFFICIAL: Civil penalties.

$10,000 per violation.

Q: In a general sense, how easy is it to put a finger on that, you say Kuwait should probably
cooperate in terms of Iraq. Do countries that we' re not particularly friendly with to begin with, are
their bank accounts in the government of Iraq, or do they have a corporation set up outside the country
and it's a lot harder to put a finger on-

TREASURY OFFICIAL: Let me say first of all we only are taking action with regard to those
And we have routine relationships with the routine
accounts over which we have jurisdiction.
international financial institutions. So to answer your question how easy is it, it's not the easiest thing
in the world, but it's not the hardest thing in the world. It's something that we have experience at
that we can and will do.
Q: Are there any Iraqi banks operating in (inaudible)?

TREASURY OFFICIAL: Yes, there are Kuwait banks. As far as Iraqi, I can't give you the-I
mean that's a question that I can't give o8'the top of my head. One week &om now chapter and verse.
Q: Can I try once more at the figures-I understand the situation now. In the case of Kuwait
(inaudibl it would be hundreds of billions or just billions, tens of billions, or in the case of Iraq, I
mean-

TREASURY OFFICIAL: Let me suggest that you might-

hKWS 17MP5CRIPTS, INC. -

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N2-st

BACKGROUND BRIEFING - August 2, 1HQ

Q: Is there any evidence-if they' ve been planning this for a long time, they obviously expect
this to happen.

TREASURY OFFICIAL: (inaudible)?
Q: Any evidence that they' ve drawn down cash in this country in the past few days, weeks?

TREASURY OFFICIAL: Once again I got to say it's too early to even guess on that. We' re
still getting it together. I mean I think some of the first important steps we needed to take we have
done, namely is to get the crisis group together, notify as many a8'ected parties as we can, get the word
out, meet with folks like you, get together. These are very good questions and they' re very important
questions.
But just don't haveQ: What are the penalties for violating?

TREASURY OFFICIAL: Criminal penalties for violating sanctions range up to 12 years in
prison, $500, 000 in corporate, $250, 000 in individual fines. Civil penalties of up to $10,000 per
violation may be imposed administratively.
Q: Civil what?

TREASURY OFFICIAL: Civil penalties.

$10,000 per violation.

Q: In a general sense, how easy is it to put a finger on that, you say Kuwait would probably
cooperate in terms of Iraq. Do countries that we' re not particularly &iendly with to begin with, are
their bank accounts in the government of Iraq, or do they have a corporation set up outside the country
and it's a lot harder to put a finger on-

TREASURY OFFICIAL: Let me say first of all we only are taking action with regard to those
accounts over which we have jurisdiction.
And we have routine relationships with the routine
international financial institutions. So to answer your question how easy is it, it's not the easiest thing
in the world, but it's not the hardest thing in the world. It's something that we have experience at
that we can and will do.
Q: Are there any Iraqi banks operating in (inaudible)?

TREASURY OFFICIAL: Yes, there are Kuwait banks. As far as Iraqi, I can't give you the-I
I can't give o8'the top of my head. One week &om now chapter and verse,

mean that's a question that

Q: Can I try once more at the figures-I understand the situation now. In the case of Kuwait
(inaudibl it ~ould be hundreds of billions or just billions, tens of billions, or in the case of Iraq
mean-

TREASURY OFFICIAL: Let me suggest that you might-

BhCKGROUM7 BRIEFING - August 2, 1990

Q: (inaudible) is it sort of a universe.

TREASURY OFFICIAL: It's not my place to do that.

I couldn't

do

it anyway at this point.

Q: There are always U. S. people who are dszaaged by actions like this, people who are about
to export something and had the deal interrupted. What will you do in situations lite that to make
them (inaudible)?

TREASURY OFFICIAL: As I mentioned, we in other programs endeavor to identify who those
groups are. And our goal is not to injure U.S. parties or other inziocent parties. Our goal is, I think
fairly clearly stated, as the president stated it and as you see in the executive order and as I' ve stated.

I think we' ll take a look at those kinds of things. I cannot speculate

on what the answer
will be because it will not be my decision. But we' ll certainly look at those. We will certainly
endeavor to understand the full range of those and be sure that they' re addressed.
And

TREASURY OFFICIAL: Unfortunately they need, Rick, in a meeting-let me just tell you that
know this is very difficult. We do not have all the answers and it's very early. But what I was
hoping is if you have questions on what we did this morning and how we notified people, what are
procedures are, I can take two or three more questions if that helps you, give you a little color to your
story, but we' re really-I apologize that we don't have all the answers. I mean, as you know, this is-

I

Q: Here's one question. How many calls have you received now &om people who will be
eff'ected by the trade embargo as well as the asset &eeze? Do you have any-

TREASURY OFFICIAL: Let me say, I joked with my staff' on the way out the door, I said you
just wait until tomorrow. And I think the number of calls will rise.

think we' re busy now,

TREASURY OFFICIAL: Do you know about how many you' ve gotten today?
TREASURY OFFICIAL: It's in the hundreds.

First American Bank is a Kuwaiti owned bank. I
Can I ask a layman's question.
understand there's some Saudi assets in it. How will this aff'ect that particular bank? In other words,
it's a mixed-if indeed it is, that's what I understand.
Q:

TREASURY OFFICIAL: There are
~'t comment
on.

Q:P was

two facts that you'ze assumixig in your question that

told by the bank that the Kuwaitis own it.

TREASURY OFFICIAL:

I can

certainly give them a call and talk to them about that.

Q: And fine out how you' re going

to—

hKWS TRAh5'CRIT', WC.

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I have-

BACKGROUND BRIEFING - August 2,

1990

Q: (inaudible) is it sort of a universe.

TREASURY OFFICIAL: It's not my place to do that.

I couldn't

do

it anyway at this point.

Q: There are always U. S. people who are damaged by actions like this, people who are about
to export something and had the deal inte~ted. What will you do in situations like that to make
them (inaudible)?

TREASURY OFFICIAL: As I mentioned, we in other programs endeavor to identif'y who those
groups are. And our goal is not to inJure U.S. parties or other innocent parties. Our goal is, I think
fairly clearly stated, as the president stated it and as you see in the executive order and as I' ve stated.

I think we' ll take a look at those kinds of things. I cannot speculate

on what the answer
will be because it will not be my decision. But we' ll certainly look at those. We will certainly
endeavor to understand the full range of those and be sure that they' re addressed.
And

TREASURY OFFICIAL: Unfortunately they need, Rick, in a meeting-let me just tell you that
know this is very difficult. We do not have all the answers and it's very early. But what I was
hoping is if you have questions on what we did this morning and how we notified people, what are
procedures are, I can take two or three more questions if that helps you, give you a little color to your
story, but we' re really-I apologize that we don't have all the answers. I mean, as you know, this is-

I

Q: Here's one question. How many calls have you received now &om people who will be
eff'ected by the trade embargo as well as the asset &eeze? Do you have any-

TREASURY OFFICIAL: Let me say, I joked with my staff'on the way out the door, I said you
just wait until tomorrow. And I think the number of calls will rise.

think we' re busy now,

TREASURY OFFICIAL: Do you know about how many you' ve gotten today?

TREASURY OFFICIAL: It's in the hundreds.
Can I ask a layman's question. First American Bank is a Kuwaiti owned bank. I
there's some Saudi assets in it. How will this aff'ect that particular bank? In other words,
it's a mixed-if indeed it is, that's what I understand.

Q:

understand

TREASURY OFFICIAL: There are
~'t comment
on.

Q:p was

two facts that you' re assuxaing in your question that

told by the bank that the Kuwaitis own it.

TREASURY OFFICIAL:

I can

certainly give them a call and talk to them about that.

Q: And fine out how you' re going

to—

hKWS 7LCiVSCRIPTS, INC.

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BACKGROUND BRIEFING - August 2,

l9Ã

Q: In a generic sense, while most Americans are sleeping their banks are shuttling money all
over the world. While Americans are sleeping, any bank in the United States that's involved in
international money is going all over the world in different time xones. Would any bank owned by the
Kuwaitis or the Iraqis now be prohibited &om even doing that basic work. because the money would
technically leave the country?

TREASURY OFFICIAL: I"m not sure what your question is. But let me say I think this
answers it and if it doesn' t, ask me again And that is we only have jurisdiction over U.S. persons.
The money side of this, you' re talkiz~ about U. S. banks. You' re either QLlking about U.S. haunches,
foreign branches of U. S. banks, or U.S. incorporated (inaudible).
Q: So that if a bank-

TREASURY OFFICIAL: This wouldn't affect Kuwaiti deposits in a third country bank over
which we had no jurisdiction.

Q: But if a bank here was owned by Kuwaitis or Iraqis and it was using its deposits or its
resources in say foreign markets at different times, can it now do that?

TREASURY OFFICIAL: No, their assets in this country ~ould be blocked
transactions in foreign countries. But not &om here.

They could do

Q: They couldn't use money here, at the close of business today, overnight.

TREASURY OFFICIAL: No.
Q: Do you feel you' ve contacted most of the major Kurwaiti
country already?

and Iraqi institutions

in this

TREASURY OFFICIAL: We have-I have people ~orking on that question to determine the
Kuwaiti institutions. Again, the Iraqi one is a little more dificult. We just can't call them up and say
&eexe your stuff.
Q: So as far as the asset &eexe then, the way to characterixe it is that you' ve &oxen all assets
4
in Kuwait's banks?

TREASURY OFFICIAL: FoQow the langmLge of the executive order. We' ve &oxen the assets,
However it
the government of Kuwait in the United States or overseas branches of U.S. institutions
readsQ. U.S. persons, it says too, right?

TREASURY OFFICIAL: Right, well persons, that's broad term that includes corporations,
5nsncial institutions.

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7RcNCKPTS, INC. - g02) N2-%50

BACKGROUND BRIEFING - August 2,

19K

Q: In a generic sense, awhile most Americans are sleeping their banks are shuttling money all
over the world. While Americans are sleeping, any bank in the United States that's involved in
international money is going all over the world in different time xones. Would any bank owned by the
Kuwaitis or the Iraqis now be prohibited &om even doing that basic work because the money would
technically leave the country?

TREASURY OFFICIAL: I'm not sure what your question is. But let me say I think this
answers it and if it doesn' t, ask me again. And that is we only have jurisdiction over U.S. persons.
The money side of this, you' re talking about U. S. banks. You' re either taller about U.S. branches,
foreign branches of U. S. banks, or U.S. incorporated (inaudible).
Q: So that if a bank-

TREASURY OFFICIAL: This wouldn't affect Kuwaiti deposits in a third country bank over
which we had no jurisdiction.
Q: But if a bank here was owned by Kuwaitis or Iraqis and it was using its deposits or its
resources in say foreign markets at different times, can it now do that?

TREASURY OFFICIAL: No, their assets in this country ~ould be blocked.
transactions in foreign countries. But not &om here.

They could do

Q: They couldn't use money here, at the close of business today, overnight.

TREASURY OFFICIAL: No.
Q: Do you feel you' ve contacted most of the major Kurwaiti
country already?

and Iraqi institutions

in this

TREASURY OFFICIAL: We have-I have people working on that question to determine the
Kuwaiti institutions. Again, the Iraqi one is a little more dificult. We just can't call them up and say
&eexe your stuff.
Q: So as far as the asset &eexe then, the way to chavscterixe it is that you' ve froxen all assets
in Kuwait's banks?

TREASURY OFFICIAL: Fouow the language of the executive order. We' ve &oxen the assets,
However it
the government of Kuwait in the United States or overseas branctms of U.S. institutions
readsQ: U.S. persons, it says too, right?

TREASURY OFFICIAL: Right, well persons, that's broad term that includes corporations,
5msncial institutions.

hKWS 7R4NSCRIPV, IHC. -

g02j 6'-9050

Bh CKGROUÃD BRIEFING - August 2,

something, I'm in trouble?

10

gag

port~xport bank and just got a check for $100 million &om Iraq to pay for

TREASURY OFFICIAL: We' re being a-well, that's a techzucal question.

h's not fair right

Q: Again, what is the reason for &eexing the Kuwaiti assets?

TREASURY OFFICIAL: It's a protective move so that invading forces could not get title to
(inaudible). It's not an unusual thing. The once-this oKce did the same thing, as I mentioned, in the
1940s when-I'm not trying to make a comparison here, but when Germany invaded Norway and
Denmark for example, so that the Germans could not get a hold of Norway and Denmark assets in the
United States. The same action was taken then.
And I believe when-there are other parallels to having done this.
Q: An example, just a hypothetical example, say someone, a Kuwait person owned a building
in New York. And what you' re saying is if the Iraqis were somehow to obtain the deed, the title to
that through this invasion, then the sale of that building or any other buildings should be-

TREASURY OFFICIAL: Your hypothetical's
This applies to the government of Kuwait.

got one Qaw on

it. You said Kuwaiti person.

Q: Okay. (inaudible).

TREASURY OFFICIAL: Okay, what's the hypothetical

again?

Q: I'm just trying to get an example of how this would operate to protect Kuwait assets. Then
you'
what
re saying is if Iraq-

TREASURY OFFICIAL: If Kuwait had assets in the United States and they had all the telex
numbers and what have you and they wanted to draw down $10,000 on deposit at Chase or City of B
of A, they couldn't do it.
Q: But if we were only

~my

government

assets, Kuwait government

TREASURY OFFICIAL: That's the title of the executive board.
Q: Period

TREASURY OFFICIAL:

~mt

you vezy much.

hKWS TLCh5CRIP75, INC. - @02) M2-S050

assets-

Bh CKGROUND BRIEFING - hugusr 2,

19Ã

I™

an import~xport bank and just got a check for $100 million &om Iraq to pay for
Q: So if
I'm in trouble?

something,

TREASURY OFFICIAL:
Q: Again, what

xs

e're

being a-well, that's a techzucal question.

It's not fair right

the reason for &eezing the Kuwaiti assets?

TREASURY OFFICIAL: It's a protective move so that invading forces could not get title to
(inaudible). It's not an unusual thing. The once-this once did the same thing, as I mentioned, in the
1940s when-I'm not trying to make a comparison here, but when Germsxg invaded Norway and
Denmark for example, so that the Germans could not get a hold of Norway and Denmark assets in the
United States. The same action was taken then.
And I believe when-there are other parallels to having done this.
Q: An example, just a hypothetical example, say someone, a Kuwait person owned a building
in New York. And what you' re saying is if the Iraqis were somehow to obtain the deed, the title to
that through this invasion, then the sale of that building or any other buildings would be-

TREASURY OFFICIAL: Your hypothetical's
This applies to the government of Kuwait.

got one Qaw on

it. You said Kuwaiti person.

Q: Okay. (inaudible).

TREASURY OFFICIAL: Okay, what's the hypothetical

again?

Q: I'm just trying to get an example of how this would operate to protect Kuwait assets. Then
what you' re saying is if Iraq-

TREASURY OFFICIAL: If Kuwait had assets in the United States and they had all the telex
numbers and what have you and they wanted to draw down $10,000 on deposit at Chase or City of B
of A, they couldn't do it.
Q: But if we were only talking government

assets, Kuwait government

TREASURY OFFICIAL: That's the title of the executive board.
Q: Period.

TREASURY OFFICIAL: Thank you very much.

hKWS

17MCRIPTS, lHC. - |202i N2-%50

assets-

I

na

portment of the Treasva ~ Waahlnofon, O.C. ~ telephone 566 201

FOR IMMEDIATE

August

RELEASE

3, 1990

THE TREASURY DEPARTMENT

1.

Contact:

Barbara Clay, 566-2041
Cheryl Crispen, 566-5252

TODAY ANNOUNCED

OIL CONTRACTS ENTERED INTO PRIOR TO
NROUTE

TO THE UNITED

THE FOLIDWING

AUGUST

ACTIONS:

990

2

STAT S

Importation of Iraqi and Kuwaiti oil will be permitted vhere
(1) the oil vas loaded prior to the effective date (5:01 a. m.
Eastern Daylight Time (EDT), August 2, 1990), vas intended for
ultimate delivery to the United States, and vas imported into the
United States before 11:59 p. m. EDT, October 1, 1990; (2) the
Bill of Lading vas issued prior to the effective date; (3) any
balance not yet paid to Iraq or Kuwait for the shipment must be
paid into a blocked account in the United States; and (4) such
transaction is reported to the Blocked Assets Section, Office of
Foreign Assets Control.

2.

RANSACTIONS

OF KUWAITI-CONTROLLED

U. S. F

S

license will be issued authorizing U. S. financial
institutions to accept deposits and clear checks vritten on the
firms in the United
blocked accounts of Kuwaiti-controlled
States, and in general to operate such firms' blocked bank
accounts, provided that no benefit to the Government of Iraq
arises from transactions in the blocked accounts. In order to
utilize the general license, Kuwaiti-controlled firms vill be
required to register vith the Office of Foreign Assets Control's
Blocked Assets Section. Financial institutions holding such
firms' accounts vill be required to verify that registration had
occurred. This vill facileate the normal day-to-day financial
functions of Kuwaiti firms an the United States and permit
payment of employees and creditors and the purchase of goods and
services in the ordinary course of the firms' business.
A

general

spo

t&oht of who TtoasQIV

FOR IMMEDIATE

RELEASE

3, 1990

August

THE TREASURY DEPARTMENT

1.

~ Waahltlgioh,

Contact:

NROUTE

i66 2041

Barbara Clay, 566-2041
Cheryl Crispen, 566-5252

TODAY ANNOUNCED

OIL CONTRACTS ENTERED INTO PRIOR TO
TO

O. g. ~ Tjphohe

THE FOLLOWING

AUGUST

2

ACTIONS:

990

E UNITED STAT S

Importation of Iraqi and Kuwaiti oil will he permitted vhere
(1) the oil was loaded prior to the effective date (5:01 a. m.
Eastern Daylight Time (EDT), August 2, 1990), vas intended for
ultimate delivery to the United States, and was imported into the
United States before 11:59 p. m. EDT, October 1, 1990; (2) the
Bill of Lading was issued prior to the effective date; (3) any
balance not yet paid to Iraq or Kuwait for the shipment must be
paid into a blocked account in the United States; and (4) such
transaction is reported to the Blocked Assets Section, Office of
Foreign Assets Control.

2.

RANSACTIONS

OF KUWAITI-CONTROLLED

U. ST

license will be issued authorizing U. S. financial
institutions to accept deposits and clear checks vritten on the
firms in the United
blocked accounts of Kuwaiti-controlled
firms' blocked bank
such
States, and in general to operate
accounts, provided that no benefit to the Government of Iraq
arises from transactions in the blocked accounts. In order to
utilize the general license, Kuwaiti-controlled firms vill he
required to register vith the Office of Foreign Assets Control's
Blocked Assets Section. P'inancial institutions holding such
firms' accounts vill be required to verify that registration had
occurred. This vill facileate the normal day-to-day financial
functions of Kuwaiti firms xn the United States and permit
payment of employees and creditors and the purchase of goods and
services in the ordinary course of the firms' business.

A

general

NB-909

3.

I

STMENT

OR

In the management of portfolio investments and securities blocked
pursuant to Executive Order 12723 representing interests of the
Government of Kuwait, hank and investment companies vill he
authorized to manage such blocked property and to reinvest the
proceeds of such property in assets subject to the jurisdiction
in the United States, provided that no investment results in an
otherwise prohibited transfer of financial or economic benefit to
the Government of Iraq. Prior to engaging in any transaction
pursuant to this general license, the U. S. person must register
vith the Blocked Assets Section, Office of Foreign Assets
Control, and provide regular reports as directed concerning such

transactions.
4

~

OMPLETION

Foreign exchange

OF FOREIGN

XCHANGE

CO

contracts entered into for the account of the

Government of Kuwait prior to 5:00 a. m. EDT, August 2, 1990, may
he completed, provided:
(1) all exchange transactions are
completed prior to August 16, 1990; (2) funds are received in the
U. S. prior to payment; and (3) all payments received for the
account of the Government of Kuwait go into a blocked account.
The Treasury

Department

expects to issue regulations

shortly.

3.

I

STMENT

OR

In the management of portfolio investments and securities blocked
pursuant to Executive Order 12723 representing interests of the
Government

of Kuwait,

hank and investment

companies

vill

be

authorized to manage such blocked property and to reinvest the
proceeds of such property in assets subject to the jurisdiction
in the United States, provided that no investment results in an
otherwise prohibited transfer of financial or economic benefit to
the Government of Iraq. Prior to engaging in any transaction
pursuant to this general license, the U. S. person must register
with the Blocked Assets Section, Office of Foreign Assets
Control, and provide regular reports as directed concerning such
transactions.
4. COMPLETION OF FOREIGN XCHANGE CO

contracts entered into for the account of the
Government of Kuwait prior to 5:00 a. m. EDT, August 2, 1990, may
be completed, provided:
(1) all exchange transactions are
completed prior to August 16, 1990; (2) funds are received in the
U. S. prior to payment; and (3) all payments received for the
account of the Government of Kuwait go into a blocked account.
Foreign exchange

The Treasury

Department

expects to issue regulations

shortly.

DEPARTMENT OF THE TREASURY

AUGUST

W ASH IN CT ON

5, 1990

of Filing of Statements

Acknowledgment

of Kuwait has filed statements concerning
certain Kuwaiti-controlled firms in the U. S. Accordingly,
are hereby authorized until
U. S. financial institutions
to
1990,
and clear checks written
deposits
accept
August 25,
firms in
on the blocked accounts of the Kuwaiti-controlled
the United States listed below (including their subsidiaries
and affiliates) and in general to operate such firms'
blocked bank accounts, provided that no benefit to the
Government of Iraq arises from transactions in the blocked
The Embassy

accounts:

Santa Fe International

Fosterlane Holdings
Crescent Holdings,
Nafra Zntervest
KFZC,

Corporation

Inc.

Corporation

(Cayman)

Inc.

Inc.
questions regarding this

Georgetown
Any

Corporation

Industries,

acknowledgment

may

be directed

to the Blocked Assets Section, Office of Foreign Assets
Control, Department of the Treasury,
(telephone 202-535-4026).

R. Richard

Washington,

Newco

D. C. 20220

Director
Office of Foreign Assets Control

DEPARTMENT OF THE TREASURY

AUGUST

WASHINGTON

5 I $9 9Q

of Filing of Statements

Acknowledgment

of Kuwait has filed statements concerning
certain Kuwaiti-controlled firms in the U. S. Accordingly,
are hereby authorized until
U. S. financial institutions
August 25, 1990, to accept deposits and clear checks written
firms in
on the blocked accounts of the Kuwaiti-controlled
the United States listed below (including their subsidiaries
and affiliates) and in general to operate such firms'
blocked bank accounts, provided that no benefit to the
Government of Iraq arises from transactions in the blocked
The Embassy

accounts:

Santa Fe International

Fosterlane Holdings
Crescent Holdings,
Nafra Zntervest

Corporation

Corporation
Znc.

Corporation

(Cayman)

KFZC, Znc.

Inc.
questions regarding this

Georgetown
Any

Industries,

acknowledgment

may

be directed

to the Blocked Assets Section, Office of Foreign Assets
Control, Department of the Treasury,
(telephone 202-535-4026).

R. Richard

washington,

Newco

D. C. 20220

Director
Office of Foreign Assets Control

DEPARTMENT OF THE TREASURY
WASHINGTON

OFF ICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL

of Certain Securities Transactions-

Completion

(a)

LICENSE NO. 1

Commercial

banking

or investment

banking

to
complete, on or before August 16, 1990, irrespective of their
stated completion date, transactions entered into prior to
5: 00 a. m. Eastern Daylight Time, August 2, 1990, involving
securities purchased, sold, lent, or borrowed for the account
of the Government of Kuwait, its agencies, instrumentalities,
and controlled entities, and the Central Bank of Kuwait (the

institutions

within the United States are hereby authorized

of Kuwait" ), provided the following terms and
conditions are complied with, respectively:
(1) The proceeds of such sale by, or return of
funds to, the Government of Kuwait are credited to a blocked
"Government

account in a commercial

banking

or investment

banking

institution within the United States in the name of the person
for whose account such sale or return was made; and
(2) The securities so purchased by, or lent or
of Kuwait are held in a blocked
account in a commercial banking or investment banking
institution within the United States in the name of the person
for whose account the purchase, borrowing, of loan was made.

returned

to, the

Government

This section does not authorize the crediting
proceeds of, or funds received with respect to, Government of
Kuwait securities held in a blocked account or a sub-account
(b)

h

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. l

KUWAIT

of Certain Securities Transactions-

Completion

(a)

Commercial

institutions
complete,

on

banking

or investment

banking

the United States are hereby authorized to
or before August 16, 1990, irrespective of their

within

stated completion date, transactions entered into prior to
5:00 a. m. Eastern Daylight Time, August 2, 1990, involving
securities purchased, sold, lent, or borrowed for the account
of the Government of Kuwait, its agencies, instrumentalities,
and controlled entities, and the Central Bank of Kuwait (the
"Government of Kuwait" ), provided the following terms and
conditions are complied with, respectively:
(1) The proceeds of such sale by, or return of
funds to, the Government of Kuwait are credited to a blocked
account in a commercial

banking

or investment

banking

institution within the United States in the name of the person
for whose account such sale or return was made; and .
(2) The securities so purchased by, or lent or
returned to, the Government of Kuwait are held in a blocked
account in a commercial

banking

or investment

banking

institution within the United States in the name of the person
for whose account the purchase, borrowing, oi' loan was made.
(b) This section does not authorize the crediting of
proceeds of, or funds received with respect to, Government
Kuwait securities held in a blocked accoun or a sub-account,

or securities returned with respect to funds held in a blocked
account or sub-account, to a blocked account or sub-account

or designation which differs from the name or
designation of the specific blocked account or sub-account in
which such funds or securities vere held.
under

any name

Issued:

August

2, 1990

/

/
I

R. Richard

i/~
Newcomb

Director
Office of Foreign Assets Control

oy

securities returned

with respect

account or sub-account,

to

to

funds held in a blocked

a blocked account or sub-account

or designation which differs from the name or
designation of the specific blocked account or sub-account in
which such funds or securities were held.
under

any name

Issued:

August

2, 1990

I

R. Richard

Newcomb

Director
Office of Foreign Assets Control

DEPARTMENTOF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 2

Oil Under Contract Entered Into Prior to
Route To The United States.

Au

st

2

1990

And

En

(a) Oil of Iraqi origin or oil in which the Government
Kuwait or the Government of Iraq has an interest may be

of

into the United States only if:
(1) prior to the effective date, the oil was loaded
for ultimate delivery to the United States on board a vessel in
Iraq, Kuwait, or a third country,
(2) the oil is imported into the United States

imported

before 11:59 p. m. Eastern Daylight Time, October 1, 1990, and
(3) the bill of lading accompanying the oil was
issued prior to the effective date.
(b)

Any

payment

owed

or balance not paid to or for the

benefit of the Government of Iraq or the Government of Kuwait
prior to the effective date for oil imported pursuant to
section (a) must be paid into a blocked account in a U. S.
financial

institution.

(c)

Transactions

conducted

pursuant

to this section

must

to the Office of Foreign Assets Control,
Blocked Assets Section within ten (10) days of the date of

be reported

in writing

importation.

this license are defined as follows:
(1) The term "oil of Iraqi origin" shall mean oil
extracted, processed or refined in Iraq.
(d) Terms used in

(2) The term "Government

of Iraq" includes:

DEPARTMENTOF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 2

Oil Under Contract Entered Into Prior to

Route To The United

States.

Au

st

2

1990

And

En

(a) Oil of Iraqi origin or oil in which the Government
Kuwait or the Government of Iraq has an interest may be

of

into the United States only if:
(1) prior to the effective date, the oil was loaded
for ultimate delivery to the United States on board a vessel in
Iraq, Kuwait, or a third country,
(2) the oil is imported into the United States

imported

before 11:S9 p. m. Eastern Daylight Time, October 1, 1990, and
(3) the bill of lading accompanying the oil was
issued prior to the effective date.
(b)

Any

benefit of the

payment

owed

Government

or balance not paid to or for the
of Iraq or the Government of Kuwait

prior to the effective date for oil imported pursuant to
section (a) must be paid into a blocked account in a U. S.
financial institution.
(c) Transactions conducted pursuant to this section must
be reported in writing to the Office of Foreign Assets Control,
Blocked Assets Section within ten (10) days of the date of
importation.

this license are defined as follows:
(1) The term "oil of Iraqi origin" shall mean oi ]
extracted, processed or refined in Iraq.
(d) Terms used in

(2) The term "Government

of Iraq" includes:

state

of Iraq, as well as
thereof,
agency, or instrumentality
any political subdivision,
including the Central Bank of Iraq;
b) Any partnership,
association, corporation, or
other organization substantially owned or controlled by the
a) The

and

the

Government,

foregoing;

c) Any person to the extent that such person is, or
has been, or to the extent that there is reasonable cause to
believe such person is, or has been, since the effective date,
acting or purporting to act, directly or indirectly
of any of the foregoing;
d) Any

other person or organization

on

behalf

determined

by

the Secretary of the Treasury to be included within section
(~) .

(3) The term "Government of Kuwait" shall mean
a) The state and the Government of Kuwait, as well
as any

political subdivision,

thereof,

including

agency,

the Central Bank of Kuwait;

b) Any partnership,

other organization

or instrumentality

substantially

association,
owned

corporation, or
or controlled by the

foregoing;

c) Any person to the extent that such person is, or
has be~, or to the extent that there Xs reasonable cause to

state

of Zraq, as well as
thereof,
agency, or instrumentality
any political subdivision,
including the Central Bank of Iraq;
b) Any partnership,
association, corporation, or
other organization substantially owned or controlled by the
a) The

and

the Government

foregoing;

c) Any person to the extent that such person is, or
has been, or to the extent that there is reasonable cause to
believe such person is, or has been, since the effective date,
acting or purporting to act, directly or indirectly on behalf
of

any

of the foregoing;
d) Any other person or organization

determined

by

the Secretary of the Treasury to be included within section
(~)

.
(3) The term "Government of Kuwait" shall mean
a) The state and the Government of Kuwait, as well

as any

political subdivision,

thereof, including
b)

Any

other organization

agency,

or instrumentality

the Central Bank of Kuwait;
partnership, association, corporation,

substantially

owned

or controlled

by

or
the

foregoing;

c) Any person to the extent that such person is, or
has be~, or to the extent that there is reasonable cause to

believe such person

is,

or has been, since the effective date,

acting or purporting to act, directly or indirectly
of any of the foregoing, and
d) Any other person

or organization

Eastern Daylight

behalf

determined

the Secretary of the Treasury to be included within
(4) The term "effective date" shall

on

mean

by

section

5:00 a. m.

2, 1990.

Time, August

(5) The term "blocked account" shall

mean

an account

institution with respect to which account
or other dealings may not be
payments, transfers or withdrawals
or'license
made or effected except pursuant to an authorization
from the Office of Foreign Assets Control authorizing
such
action.
(6) The term "U. S. financial institution" shall mean
in a financial

any U. S. person

or making,

engaged

granting,

transferring,

or credits,

or of purchasing

commodities

or procuring

principal
savings

or agent,
banks,

trust

of accepting deposits
holding, or brokering loans

in the business

or selling foreign exchange or

purchasers

including,
companies,

and

sellers thereof, as

but not limited

to,

securities brokers

banks,
and

dealers,

believe such person
acting or purporting

is,

or has been, since the effective date,

to act, directly or indirectly

behalf

on

of the foregoing, and
d) Any other person or organization determined by
the Secretary of the Treasury to be included within section
of

any

(4) The term "effective date" shall

mean

5:00 a. m.

2, 1990.
(5) The term "blocked account" shall mean an account
in a financial institution w'ith respect to which account
or other dealings may not be
payments, transfers or withdrawals

Eastern Daylight

Time, August

to

made

or effected except pursuant

from

the Office of Foreign Assets Control authorizing

an

authorization

or'license
such

action.
(6) The term "U. S. financial institution" shall mean
any U. S. person engaged in the business of accepting deposits
o

making,

or credits,

granting,

transferring,

or of purchasing

holding,

or brokering

loans

or selling foreign exchange or

sellers thereof, as
principal or agent, including, but not limited to, banks,
savings banks, trust companies, securities brokers and dealers,
commodities

or procuring

purchasers

and

commodities

plans,

brokers,

and holding

investment
companies

or subsidiaries

foregoing.

Issued: August 8, 1990

R. Richard

companies,

Newcomb

Director
Office of Foreign Assets Control

employee

pension

of

of the

any

commodities

plans,

brokers,

and holding

investment
companies

or subsidiaries

foregoing.

issued: August 8, 1990

R. Richard

companies,

Newcomb

Director
Office of Foreign Assets Control

employee

pension

of

of the

any

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
ASSETS CONTROL REGULATIONS

KUWAIT

3

GENERAL LICENSE NO.

of

Investment
Accounts.

Government

(a) U. S. financial

to invest
name

and

reinvest

of the Government

of Kuwait

Held in Blocked

Funds

are hereby authorized
funds held in blocked accounts in the
of Kuwait, subject to the following

institutions

conditions:
(1) The proceeds of such investments and
reinvestments are credited to a blocked account or
sub-account which is in the name of the Government of
and which is subject to the jurisdiction of the United

Kuwait

States;
(2) The proceeds of such investments and
reinvestments are not credited to a blocked account or

sub-account

under

any name

or designation

which

differs

from

of the specific blocked account or
sub-accoun
in which such funds or securities were held; and
(3) no financial or economic benefit accrues to
the Government of Iraq as a result of the transaction.
(b) (1) U. S. persons seeking to avail themselves of this

the

name

or designation

register with the Office of Foreign
Abets Control, Blocked Assets Section.
(2) Transactions conducted pursuant to this
section must be reported to the Office of Foreign Assets
authorization

Control,
completion

must

Blocked Assets Section within

of the transaction.

ten (10) days of

DEPARTMENT OF THE TREASURY
W A 5H I N

6T Q

tV

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 3

Investment
Accounts.

of

(a) U. S. financial

to invest

and

of Kuwait

Government

reinvest

of the Government
conditions:

name

Funds

Held in Blocked

institutions

are hereby authorized
funds held in blocked accounts in the
of Kuwait, subject to the following

(1) The proceeds of such investments and
reinvestments are credited to a blocked account or
sub-account which is in the name of the Government of Kuwait
and which is subject to the jurisdiction of the United

States;
(2) The proceeds of such investments

and

are not credited to a blocked account or
sub-account under any name or designation which differs from
the name or designation of the specific blocked account or

reinvestments

in which such funds or securities

sub-accoun

were held;

and

(3) no financial or economic benefit accrues to
the Government of Iraq as a result of the transaction.
U. S. persons

(b)(1)

seeking to avail themselves

of this

register with the Office of Foreign
Assets Control, Blocked Assets Section.
(2) Transactions conducted pursuant to this
section must be reported to the Office of Foreign Assets
authorization

Control,
completion

must

Blocked Assets Section within

of the transaction.

ten (10) days of

(d) Terms used in

this license are defined as follows:

of Zraq" includes:
a) The state and the Government of Iraq, as well
as any political subdivision, agency, or instrumentality
thereof, i~eluding the Central Bank of Iraq;

(1)

The term "Government

b) Any partnership,

other organization

association,

substantially

owned

corporation, or
or controlled by the

foregoing;
c)

Any

is,

person to the extent that such person

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on

behalf of

any

of the foregoing;

d) Any other person

or organization

determined

the Secretary of the Treasury to be included within

sec ion

(I) .
(2) The term "Government

of Kuwait" shall

mean

a) The sta e and the Government

well as any

political subdivision,

instrumentality
Kuwait;

thereof,

including

by

of Kuwait,
agency, or
.

the Central Bank of

a"

(d) Terms used in

this license are defined as follows:

of Iraq" includes:
a) The state and the Government of Iraq, as well
as any political subdivision, agency, or instrumentality
thereof, including the Central Bank of Iraq;

(1) The term "Government

b) Any partnership,

other organization

association,

substantially

owned

corporation, or
or controlled by the

foregoing;
c)

Any

person

to the extent that

is,

such person

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on

behalf of any of the foregoing;
d) Any other person or organization

determined

the Secretary of the Treasury to be included within

(1)

sec ion

~

(2) The term "Government

of Kuwait" shall

mean

a) The sta e and the Government

well as any

political subdivision,

instrumentality
Kuwait;

thereof,

including

by

of Kuwait,
agency, . or

the Central Bank of

a"

b) Any partnership,

other organization

substantially

association,
owned

corporation,

or controlled

or

by the

foregoing;

c)

Any

person

to the extent that

such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on

behalf of any of the foregoing, and
d) Any other person or organization determined by
the Secretary of the Treasury to be included within section
(~)

~

(3) The term "blocked account" shall mean an
account in the United States with respect to which accoun

transfers or withdrawals or other dealings may not
be made or effected except pursuant to an authorization
or
license from the Office of Foreign Assets Control
authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or meking, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling

payments,

foreign exchange or commodities or procuring purchasers and
sellers thereof, as principal or agent, including, but not
limited to, banks, savings banks, trust companies,

b) Any partnership,

other organization

substantially

association,
owned

corporation,

or controlled

or

by the

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing, and
determined by
d) Any other person or organization
the Secretary of the Treasury to be included within section
(~)

~

(3) The term "blocked account" shall mean an
account in the United States with respect to which accoun

transfers or withdrawals or other dealings may not
be made or effected except pursuant to an authorization or
license from the Office of Foreign Assets Control
authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or eeking, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling

payments,

foreign exchange or commodities or procuring purchasers and
sellers thereof, as principal or agent, including, but, no
limited to, banks, savings banks, trust companies,

securities brokers
investment

companies,

dealers,
employee

or subsidiaries

companies

Issued:

and

August

R. Richard

of

commodities

pension plans,
any

8, 1990

Newcomb

Director
Office of Foreign Assets Control

brokers,
and holding

of the foregoing.

securities brokers
investment

companies,

dealers, commodities
employee

or subsidiaries

companies

Issued:

and

August

R. Richard

of

pension plans,
any

8, 1990

Newcomb

Director
Office of Foreign Assets Control

brokers,
and holding

of the foregoing-

DEPARTMENT QF THE TREASURY.
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 4

Transactions
Government

b

U. S.

of Kuwait.

Entities

or Controlled

Owned

b

the

transactions by a U. S. financial
institution that is not owned or controlled by the
Government of Kuwait are hereby authorized with respect to
blocked accounts held in the name of entities owned or
controlled by the Government of Kuwait that are located
within the United States:
(a) The following

(1)
or transfer

Any payment

from outside

or transfer,

including

any payment

the United States, into such

blocked accounts;
(2 ) Any payment

or transfer

from such blocked

that no benefit accrues to the Government
of Iraq from such transactions.
(b)(1) Entities owned or controlled by the Government
of Kuwait, seeking to avail themselves of this
authorization, must register with the Office of Foreign
Assets Controi, Blocked Assets Section.
(2) Financial institutions must, require evidence
of such registration before undertaking any transaction
accounts,

provided

to this license.
(c) Terms used in this license are defined as follows:

pursuant

(1)

The term "Government

of Iraq" includes:

DEPARTMENT QF THE TREASURY.
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 4

Transactions
Government

b

U. S.

of Kuwait.

Entities

Owned

or Controlled

b

the

transactions by a U. S. financial
institution that is not owned or controlled by the
Government of Kuwait are hereby authorized with respect to
blocked accounts held in the name of entities owned or
controlled by the Government of Kuwait that are located
(a) The following

the United States:

within

(1)
or transfer

Any payment

from outside

or transfer,

including

any payment

the United States, into such

blocked accounts;
(2 ) Any payment

or trans f er from such blocked

that no benefit accrues to the Government
of Iraq from such transactions.
(b)(1) Entities owned or controlled by the Government
of Kuwait, seeking to avail themselves of this
authorization, must register with the Office of Foreign
Assets Controi, Blocked Assets Section.
(2) Financial institutions must require evidence
of such registration before undertaking any transaction
accounts,

provided

to this license.
as follows.
(c) Terms used in this license are defined
r

pursuant

(1)

The term "Government

of Iraq" includes:

a) The

state

c)

person to the extent that such person

of Iraq, as well
as any political subdivision, agency, or instrumentality
thereof, including the Central Bank of Iraq;
b) Any partnership,
association, corporation, or
other organization substantially owned or controlled by the
and

the Government

foregoing
Any

or has been, or to the extent that there

is reasonable

is,
cause

to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing;
d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within section

(1)of Kuwait" shall mean
a) The state and the Government of Kuwait, as
well as any political subdivision, agency, or
thereof, including the Central Bank of
instrumentality
(2) The term "Government

Kuwait;

association, corporation, or
substantially owned or controlled by the

b), any partnership,
other organization

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause
to believe such person is, or has been, since the effective

date, acting or purporting to act, directly or indirectly
behalf of any of the foregoing, and

on

a) The

as any

state

and

political subdivision,

thereof, including
b)

Any

other organization

of Iraq, as well

the Government
agency,

or instrumentality

the Central Bank of Iraq;

partnership,

corporation, or
or controlled by the

association,

substantially

owned

foregoing;

c)

Any

is,

person to the extent that such person

or has been, or to the extent that there

is reasonable

cause

to believe such person is, or has been, since the effective
date, acting or purporting to act, directly or indirectly on
behalf of any of the foregoing;
d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within section

of Kuwait" shall mean
a) The state and the Government of Kuwait, as
well as any political subdivision, agency, or
thereof, including the Central Bank of
instrumentality
(2) The term "Government

Kuwait;

association, corporation, or
substantially owned or controlled by the

b), any partnership,
other organization

foregoing;

c)

Any

person to the extent that such person

is,

or has been, or to the extent that there is reasonable cause.
to believe such person is, or has been, since the effective

date, acting or purporting to act, directly or indirectly
behalf of any of the foregoing, and

on

d) Any other person

or organization

determined

by

the Secretary of the Treasury to be included within

section

(1).
(3)

The term "blocked account"

(4)

The term "U. S.

shall mean an
account in a financial institution with respect to which
account payments, transfers, or withdrawals or other
dealings may not be made or effected except pursuant to an
authorization or license from the Office of Foreign Assets
Control authorizing such action.
any U. S. person

financial

institution"

shall

of accepting
deposits or making, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling
foreign exchange or commodities or procuring purchasers and
sellers thereof, as principal or agent, including, but not
limited to, banks, savings banks, trust companies,
securities brokers and dealers, commodities brokers,

mean

investment
companies

engaged

companies,

employee

or subsidiaries

of

in the business

pension plans,
any

Issued August 8, 1990
gi

R. Richard

/

Newcomb

Director
Office of Foreign Assets Control

and holding

of the foregoing.

d) Any other person

determined

or organization

by

the Secretary of the Treasury to be included within

section

(1).
The term "blocked account"

(3)

shall

mean

an

institution with respect to which
account payments, transfers, or withdrawals or other
dealings may not be made or effected except pursuant to an
authorization or license from the Office of Foreign Assets
Control authorizing such action.
(4) The term "U. S. financial institution" shall
mean any U. S. person engaged in the business of accepting
deposits or making, granting, transferring, holding, or
brokering loans or credits, or of purchasing or selling

account in a financial

foreign exchange or commodities

or procuring

purchasers

and

sellers thereof, as principal or agent, including, but not
limited to, banks, savings banks, trust companies,
securities brokers and dealers, commodities brokers,
investment
companies

companies,

employee

or subsidiaries

of

pension plans,
any

Issued August 8, 1990
ji

R. Richard

/

Newcomb

Director
Office of Foreign Assets Control

and holding

of the foregoing.

TEE WRITE SOUSE

Office of the press Secretary

tor

Zmmodiate

Release

August

10, 1990

EXECUTIVE ORDER

12274
BLOCXZNC

IRAQI COVERACDIT PROPERTy
AND

PROHIBITING TRANSACTIONS

WITH IRAQ

Sy the authority vested in mo as Presf4ont by the
Constitution and laws of the United States of America, inclu4fng
tho International Emergency Economic Povers Act (50 U. S.C. 1701
), the National Emergencies Act (50 U S.C. 1601
section 301 of title 3 of the Unite4 States Co4o, and tho
United Nations Participation Act (22 V. S.C. 2$7c), in view of
United Nations Security Council ReSOlutfcn NO. 661 of August 6,
to
1990, and in order to take additional stops vith respect
Iraq's invasion of Kuwait and tho national emergency declare4
in Executive Or4er No. 12723,
I, GEORGE BVSH, president of the Vnito4 States of America,

~~.).

gee.

hereby or4er:

Except to tho extent 'provido4 in regulatf ons
this order, all
hat may hereafter bo issued pursuantof to
Covernment of Iraq
the
in
property
property and interests
come vfthfn the
hereafter
that
States,
United
the
that are fn
the
come
vithin
hereafter
United States, or that aro or
inc1uding
persons,
States
United
of
control
possessfon or
their overseas branches, are hereby blocked.
except to the extent
The following aro prohibited,
issued pursuant to
be
hereafter
provided in regulations that may

this or4er:

or
into tho United States of any goo4s
(a) The importation or
s
or
f
promotes
that
any act ivf ty
services o f Iraqi origin, importationJ
intended

to promote such

entity operated
exportation to Iraq, or to any
of Iraq,
Government
tho
by
controlle4
froa Iraq, or owned or of any goods, technology (including
directly or indirectly,
information), or services either
technical Cata or other
fssuanco of
United States, or (ii) requiring the
promotes
(i) from the
that
agency, or any activity
of
4onatfons
a license by a toderal
except
exportation,
such
an4
ood
or fs intende4 to promote
f
as
such
to -relf evo human suffering,
art f clos intended
purposes
medical
J
for
strictly
supplies intendo4
to
by a Vnite4 States person related
6
(c) Any dealing
August
af
ter
froa Iraq
f gin exportedexportation
any
to
property of Iraqi or
froa
Iraq
intende4 fog
1990, or property
or any
to Iraq f roa any country,
exportation
country or
to promote
intended
is
or
promotes
activity of any kind that
such 4ealing J
o
United states person relatingalien
a
by
transaction
Any
permanent resi4ent
States cftfsen or person
vf thin Iraq
travel by any Vnfto4
such
by any
J'raq or to act iv it i osother
necessary to
transaWions
than
order,
this
of
~
dat
the
aore
(b)

The

«

(OVER)

TEE MEZZ

Of f f ce

~or Zmmodiato

Iovsx

of the press Secretary

Release

August

10, 1990

EXECUTZVE ORDER

12274
ILOCXZNC

ZRAgZ

GOVERNNEHT

PROPERTY

AND

PROHIBITING

TRANSACTIONS

QQ()

WITH

Sy the authority vested in mo as Prosf4ent by the
Constitution and lavi of the United States of America,
the Zntornational Emergency Economic Povers Act (50 U. S.including
C. 1701
the NatiOnal Emergencfeo ACt (SO U S C 1601 ~ggge),
),
section 301 af title 3 of the Unite4 States Code, and the
United Nations Participation Act (22 V. S.C 287c), in vfov of
United Nations security council Rosa]utfon No. 651 of August 6,
1990, and in order to take additional stops vfth respect to
Zzaq's invasion of Kuvaft and the national emergency declared
in Executive Or4ar No. 12722,

joe.
I,

~

GEORGE SUSH,

hereby or4ez:

President

may

of the United States of America,

States, that hereafter come vithfn the
are oz hereafter come vithin the
of United States persons, including

their overseas branches,
The

provided

~

Except to the extant provided in regulations
issued pursuant to this order, all
in Property of the Government of Zraq

hereafter be
property and interests
that are in the United
United States, or that
possession oz control

that

~

are hozeby blocked.

folloving aro prohibited, except to the extent
that may hereafter be issued pursuant to

in regulations

this order:

(a) The importation into tho Vnited States of any goods or
services of Iraqi origin, or any activity that promotes or fs
intended to promote such importation;
(b) The exportation to Iraq, or to any entity operated
from Iraq, or ovned or controlled by tho Government of Izaq,
directly or indirectly, of any goo4s, technology (including
technical Cata or other information), or services either
States, or (ii) requiring the issuance of
i) from the United
federal
~
agency t or any activity Chat promotes
a
license
by
a
except 4onat iona of
or fs inten e4 to pzo'mote such exportation
ta-relieve
human
sufferfng,
such as oo4 an4
an
intended
i l
articles
mo41ca]
for
strictly
purpose.
intendo4
supplies
Unite4 States parson relate4 to
(c) Any dealing hy aexported
from Iraq after Au»t 6,
origin
Iraqi
af
ra ert
raperty inton4od for exportation from Iraq to any
a ortation ta Iraq from any country or any
activity of any k i n 4 tha't promotes ar is inten4od to promote
such dealing]
transaction hy a United States person relating ta
An
nito4 States citizen af permanent
Ln
person vithi Iraq, attez
or to activities by any such
a
CfansacC
fons necessary to
Chan
oChef
Cho 44' ot Chfs or 4 af, 0
&

moro

(ovER)

~ f feet (i) such person ' ~ departure tro'm Iraqi (if
and
activities for the conduct ot ths otticial business) travel
ot the

federal Government or ths Vnftod Nations, ar (iii) travel tor
gournalfstfc activity by persons regularly employed in such
capacity by a nave-gathering organisation;
( ~ ) Any transaction by a United States parson rs]atfng to
transportatfon ta or from Iraq; tho provision at transportation
to oz from the Vnitod States by any Iraqi parson or any vessel
or aircraft ot Iraqi rogfstratfon& or the sale in the
United States by any person haldfng autharfty under the E'odazal
Aviation Act a! 1958, as amen4od (l9 V, S C. 1301 ~gag. ), of
any tzansportatfon
by air that inclu4os any stop in Izaq;
(f) Tho pazformanca by any United States person of
contract, including a financing contract, in support of anany
industrial, commercial, publia utility or governmental pro)eat
~

fn Iraq!

(g) Except as otharviso authorised herein, any commitment
oz transfer, 4iroct oi in4iroct, at tun4s, or other financial or
~ cohomic resources by any United states person to the cavsrnmont
of Iraq or any other parson in Iraq!
(h) Any tzansactfon by any Vnitod States person that
evades or avoids, or haa tho purpose of evs4fng or avofding,
set forth in thfs order.
any of tho prohibitions

ot this or4er:
(a) the term "United States parson means any
United States citf!an, permanent resident alien, Juridical
parson organized under tho lave of tho United States (including
foreign branches), or any person in the Unite4 States, and
vessels af V. S. registration.
(b) tho term 'Covornment af Iraq" includes tho Government
and controlled
of Iraq, its agencies, instrumentalities
entities, an4 tho Central Sank of Iraq.
This order is effective immediately.
The Secretary of the Treasury, in consultation
to take such
vith ths Secretary af Stats, is hereby authorised
as
regulations,
rules
and
of
actions, including tho promulgatian
Such
ardor.
af
this
purposes
tho
out
to
carry
may bo necessary
regulating payments az
actfohs may include prohibiting oztransactians
involving the
or
anY
transfers of any property
States
United
value
any
by
oconomfc
of
anything
transfer af
ar
national
to
or
any
Iraqi
parson ta the government of Iraq,
tho
ar
in4irectly,
by
directly
entity avnod ar controlled,
Tho Secretary of the
Oovoznment of Iraq or Iraqi nationale. functions
ta other of f f cars
these
Treasury may redelegate any of
af the
All
agencfes
Government.
Federal
an4 agencies af the
measures
arnment are directed to take all appropriate
this
the
af
provisians
aut
to carry
vfthfn their autharfty suspension
or termination of licenses ar
the
including
order,
the Cata of thfs ozdar.
other autharfsatfans fn effect as of
2, f990, is
Executive Order No. I2722 af August
this'azdaz
vfth
inconsistent
hereby
aby zevok ed t o th ~ extent ante orders( lf canoes
rogulatf
les
~,
ru
l
akan
4e1 atians,
made, fssuo4, ar othezeyfso
of admfnfstratfve Na.action
admfnfstzatfvaly
revoked
not
12022 and
Poz purposes

~

ive Order
area
shall remain fn fu

maz ~

(i) such pe»»'s
from Iraq
(ii)
activities for the conductdeparture
of the official business
federal government

or the United Nations, or (iii) travel
Saurnalistic activity by persons
regularly amployeC fn suchfor
capacity by a neve-gathering organieatioh;
( ~ ) Any transaction
a United States parson»latin
transportation ta or from by
Iraq;
provision of trans &
to or from the United States by tho
or any
or aircraft af Iraqi rogistrationiany orZrathei parsoh
sale ih th e vessel
Vhitod States by any person holding authority
under tho Fedora
Aviation Act of 1958, as amended (E9 V, S, C. 1)01
), of
any transportation
by air that includes any stop ~gag.
ihh Iraq
(f) The pazformance by any United States person of any
contract, inclu4ing a financing
contract, in support af an
industrial, commercial, public utility,
or government
en a 1 pro)oct
5
in
p

Zzaq!

(g) Except as othervise authorised
any commitment
ar transfer, 4iroct or indirect, af funds herein,
oz other financial or
~ conomic resources by any
StateS Pezson to tha sovarhmoht
of Iraq or any other parsonUnited
in Iraqi
Any transaction
by any Vnito4 States
that
or avoi4s, or haa the purpose af eva4ing person
ar
avoiding,
any of the prohibitions
set forth in this order.

~ vades

(h)

Qg~.

of this or4er:
(a) the term "United states parson» means any
United States citizen, permanent resident alien, Juridical
parson organized under the lava of the United States (including
foreign branches), or any person in the Unito4 States, an4
vessels of V. S. registration.
(b) the tazm Covornment of Iraq" includes the Government
of Iraq its agencies, instrumentalities
and controlled
~ ntitios, and tha Central Sank af Zzaq.
This order is effective immediately.
The Secretary of the Treasury, in consultation
vith the Secretary of State, is hereby authoziaod to take such
actions, including tho promulgation of rules and regulations, as
such
may bo necessary to carry out tho purposes of this order.
actiohs may include prohibiting oz regulating payments or
transfers of any property or any transactians involving the
transfer of anything of economic value by any Vnited States
person ta the Government of Zraq, or to any Iraqi national or
entity ovnod ar controlled, directly oz indirectly, by the
The Secretary of the
government of Iraq or Iraqi nationale
to ather officers
Treasury may redelegate any of these functions
issued
Government.
All
Federal
tho
agencies
of the
of
and agencies
all appropriate measures
rodera] Government aro directed to take
within their authozity ta carry out tho provisians of this
oz terminatiah af licenses or
ardor( ihcludihg the suspehsiah
othaz authazisatiohs ih affac't as of tha date af this ozdar
Executive order Na. 12722 of August 2, 1990, is
to the extent inconsistent vith this order. All
revoked
hereby
and other
delegations, rules, zogulatiahe, orders& licenses,
taken
oz
otherviso
made,
actiaa
strative
farms of admin f
revoked
hot
administratively
ahd
12722
Na,
Order
~ocutivo
under
shall remain ih full force ahd effect under this order until
sore
Por purposes

~

&

aaen&e4, Io&ified, or terminate4 hy proper authority,
The
revocation of any provision of Executive Order No. LQ'lgg
pursuant to this section shall not affect any violation of
any rules, reguiationa,
or&era, licenses, or other forsa of
e&ainistrative action un&sr that or&sr Curing the perjo&
that such provision of that or&sr vas in affect.
This order shall he transmitted to the Con(Tees an&
publiahe& in the e

OEORCE IUSH

THE WRITE HOUSEi

August

9,

LQSO.

amended, modified, or terminated
by proper authority,
revocation of any provision
Tha
of
Executive
pursuant to this section shall not affect Order No. XQ7gg
anY violation of
any rulesi rolpliations,
orders, licensees or other
forms of
administrative action under
order during tha period
that such provision of that that
order vas in effect.
Thi ~ order shall ba transmitted to the
Congress and

OEORCX IQSH

THE WRITE HOUSEL'
August 9y l990 ~

mx

WZITE MOUSE

Off f co of the P?es ~ Secretary

Par Zaedfato Release

August

10, 1990

EXECUTIVE ORDER

12275
W

ILOCKING RUlfAITI COVXRhNENT

PROKIIZTZNC

PROPERTY

AND

TRANSACTIONS

MZTH

KUWAIT

Sy the authority vested in me as President by the
Constitution an4 lava of the United States ot America,
tho Internatianal Emergency Economfc Povers Act (50 U. S.including
C. 1701
~ggg
) i the National Emergencies Act (50 U. S C 160 1
)
~ ection )01 af title 3 ot tho United States Code, and the
United Nations Participation Act (21 U. S. C, 247c), in vfev af
United Nations Security CounCil Resolution Ho. 661 of August 6,
]990i and in order to take additional steps vith respect to
Iran' ~ invasion af Kuvaft an4 the national emergency
declared
fn Executive Or4er No. ]j72i,
~

I,

GEORGE BVSH,

hereby ar4er:

President

~

j~g

of the United States oi America,

Except to the extent provided in regulatfons
that may hereafter be fssued pursuant to this order, all
property and interests in property af the Government ot Fuvaft
that are in the United States, that hereafter come vithfn the
United states, or that are or hereafter come vithfn the
possession or control af United States persons, including
their overseas branches, are blocko4.
except to the extent
The fallovfng are prohibited,
provido4 fn regulations that may hereafter be issued pursuant to
this or4oz:
(a) The importatfon inta the Vnited States of any goods or
services of Kuvaitf arigfn, or any' activity that promotes or is
intended to promote such fmportat]onJ
any entity operated
(p) The exportation to Ãuvait, artheto Covernmont
of Kuvaft,
controlle4
or
ovned
by
o
or
Kuva
ft
Ku
from
f
( including
4 f rec tl y orr indi rect ly, af any goods, technology
~r
technical data or other fntormation), or s ezvfces
of
issuance
the
re+izing
or
States,
(ff)
Vnfto4
the
from
f)
activity
promotes
that
ar
any
Federal
agency,
a license by ~
4 4 to promote such exportation, except donations of
suffering, such as foo4 and
f tondo4 ta relievetorhuman
medical
purposes f
strictly
supplies intended
Any 4ealf~ by a United States person releto4 ta
tram Kuvaft atter August 6
zo ezt af Kuvaftf azfgfn expoztod
+a o~v
zty intended for exportatf on fz4& Qivs 4 +
p
froa
or
any
any
Kuvaft
country,
ta
oz expoztatfon
or is intended to promote
a promotes
actfvity of any k i n 4 that
r
~ uch dealing;
to
tza»action by a Vnitod States parson relatingal fan
resident
or
permanent
United states citi4en
to activities by any such 'person vfthf„Kuvaft,
after the date of this or 4 er, th

]

maze
(QVER)

TRE NEZTE SOUSE

Of f ico

Por Zaunodiate

of tho Pres ~ Secretary

Release

August

10, 1990

EXECUTZVE OmER

12275
m

BLOCKINC XUWAZTZ

a

m

a

COVXRhlCENT

PROPERTY

AND

PROEZBZTZNC

TRANSACTIONS

MZTI KUIAZT

Sy the authority veste4 in me as President by the
Constitution an4 lava af the Urd. ted States of Amezica,
the Znternational Emergency Economic Povers Aet (50 U. S.including
C. D01
tho National Emergencies Aet (50 U. S.C. 1401 af'~g.
),
),
section )01 of title 3 of the United States Code,
the
United Nations Participation Act (11 U. s. C. 187c), and
in viov of
United Nations Security Council Resolution No. 441 of
August 4,
1990, and in order to take additional stops vith respect
to
Zraq's invasion of Kuvait an4 the national emergency declared
in Executive Order No. 11711,

~~.
I,

GEORGE BUSH,

hereby order:

President

of the United States of America,

Except to the extent provi4ed in regulations
that may hereafter be issued pursuant to this or4er, all
property and interests in property of the Government of Kuvait
that aze in the United States, that hereafter come vithin the
United states, or that are or hereafter come vithin the
pcssossion or control of United States parsons, including
their overseas branches, are blocke4.
The folloving aze prohibited,
except to the extent
provided in regulations that may hereafter bo issued pursuant to
this or4ar:
(a) The importation into the United States of any goods or
services of Fuvaiti origin, or any activity that promotes oz is
intended to promote such importation;
(p) The exportation to Fuvait, or to any entity operated
f zom Kuvait oz ovnod or contre lle4 by the Coveznment of Kuvait,
(including
4izectly or indirectly, cf any goods, technology
or services either
'tochcical da'ta or other inf ormation)
States, or (ii) re+izing the issuance of
(i) from the Unite4
Federal
agency, or any activity that pzomotos
a
license
a
by
except donations of
or is intande4 to promote such exportation,
suf
human
such as f oo4 and
faring,
relieve
to
intende4
articles
ca
medi
1
purposes
for
strict
f
ly
intended
supplies
Any dealing by a United States parson related to
Kuvaiti origin exported f?om Xuvait after August 4i
of
property
fram. gv.
lySO, or property intando4 for exportation
from
atly
oz any
Kuvait
country,
to
exportation
country or
or
is
promote
intended
to
that
promotes
kind
any
of
activity
such dealing)

to
transact|oh by a Unite4 States pazson relatingalien
resident
or
permanent
citizen
b an Units4 States
any such person vithin Kuva it,
uvait oz to activities by other
than tzansactions necessary
after the date of thi s order
4)

Any

more
(OVER)

ta ef f ect (i) such persoh ~ departure fz'om
Xuwaf t, (if ) travel
and activities for
conduct of the offfcial business
Federal Covenant the
of
or the Unfted Natfonsi az' (fff)
travel for
fournalfstic activity by
persons regu&arly

hevs~atherfng arganfsatfon' employed in such
( ~ ) Any transaction by a United States
person re1atfng to
transportation to or from Kuwait;
tion to or from the United States the provfsioh at transportaby ahy Xuwaftf
vessel or aircraft af Xuvaiti
or any
registration& or theperson
United States by any pezson
sale
in
the
holding autharfty under the Federal
Aviation Act of 1950, as amended
(19 U. S C 1301
any transportation
) f af
by air that includes anY stop ~gag.
fh Xuvait;

capacity

by a

~

~

(f) The performance by any United States person
contract, including a financing
contract, in support ofof anany
industrial, commercial, public utility,
or governmental project
in Kuwait;

(g) Except as otherwise
hereih, ahy commftment
or transter, direct or indirect,authorised
at funds, ar other
financial or
economic resources by any United States
of Kuvait oz' any other person in Xuvait; person to the Covernment
(h) Any transaction by any United States person that
evades or avoids, or has the
purpose of evading or avai4ing,
any of

the prohibitions

set torth in this order.
For purposes of this order:

(a) the term "United States person"
any
United States citizen, permanent resident means
alien,
)urfdical
person organized un4ar the laws of the United States
foreign branches), ar any person in the United States, (fncluding
an4

vessels of

Q. S.

registration.

the term "Covarnmant of Kuvait" includes the
af Kuvaft or any entity purporting to be
of Kuwait, its agencies, instrumentalities theand
controlled entities, an4 the Central Bank of Kuvait.
This order is effective imme4fately.
(b)

Covernment
Covarnment

The Seczetary of the Treasury, in consultation
vith the Secretary af Stats, is hereby authorized to take such
actions, including the promulgation at rules and regulations, as
may be necessary to carry aut the purposes of this order.
such
actions may include prohibiting or regulating payments or
transfers of any property or any transactions involving the
af an~~ing af economic value by any United States
a f Ku vaft or to any Kuvaftf hational
person to the Cavernmeh
or entity owned ar contralled, directly or ihdfrectly
by thee
The Secretary af
nt af Kuwait or Kuvafti natfonals.
l t ny of these tunctio
1ll agencies of the
4 a ancies af the Federal Covernment.
measures
C erhment are -directe4 to take all ~ppropriate
uthority to cd~ out the provisions af this
ihclu4ing thee suspensian or terminatfoh of licenses or
d
other authar4sa ti 0ns in etfect as af the data of thfs -r4oe
Executive Order Ny. 12723 ot August 2 geog, fs
zevoke4 to the extent inconsfsteht vith this order,
les, regulations, orders, licenses,
istrative action made, issued, ar otherwise taken
2723 and not ravok 4
~ cutive Or4er No.
shall remain in full force and effect under this order unt il
~

,

mors

to ef foct (i) such person ' ~ departure from Kuva it, (ii ) trave 1
and aotivitiea for the conduct of the o&fic&a1 buaihoas of the
Federal Coverisheht or tho United Nations or (iii)
f or
Journalistic activity by persona regularly employed travel
in ouch
~

capacity

by a

nova~athering

organisation&
Any transaction
by a United States
relating to
transportation to or from Kuvait; the provisionperson
transportation to or from the United States by any Kuvaiti ofperson
or any
vessel or aircraft of Kuvaiti rogistrationl or the
in the
United states by any person holding authority under sale
the
Federal
Aviation Act of 1959, aa amended (49 U S C 1201 ~gag. ), of
(~)

any

transportation

by

air that includes

ahy

stop in Kuvait;

(f ) The 'perf ormahce by any United States peraoh of any
contract, including a financing
contract, in support
an
industrial, commerciali public utility, or governmentalof pro)oct
in Kuvait&

(g) Except as otharvise authorised heroin, any commitment
or transfer, direct or indirect, of funda, or other financial or
economic resources by any United States person to the Government
of Kuvait or any OCher person in Xuvait;
(h) Any transaction by any United States person that
evades or avoids, or has the purpose of evading or avoi4ing,

aet forth in this order.
For purposes of this or4er:
(a) the term "United States person" means any
United States citicen, permanent resident alien, )uridica1
person organized under the lava of tho United States (including
foreign branches), or any person in the United States, an4
vessels of UIS registrations
any

of the prohibitions

~

tho term "Covarnmant of Kuvait" inclu4ea the
of Kuvait or any entity purporting to be the
and
of Kuvait, ita agencies, instrumentalities
controlled entities, and the Central Sank of Kuvait.
Qg~e This order is ef f ective imme4iate]y.
(b)

Govornmer»
Government,

Secretary of tho Treasury, in consultation
authorised to take such
vith tho Secretary of State, is herebyof rules
aa
and rogulationa,
promulgation
the
including
actions,
Such
order.
of
the
purposes
this
may bo necessary to carry out
regulating payments or
actions may include prohibiting ortransactiohs
involving the
or
any
property
transfers of any
value by any United States
transfer of anything of economic
or to any Kuvaiti national
parson to the Covarnment of Kuvait,
by tha
ovhed or controlled, directly or indirectly,
of the
nationale.
The
Secretary
Kuvaiti
or
ve rm,ant of Kuvait
Co„,
te any of these functions to other officers
1
All agencies of the
ios of the Federal Covernmont.
nt are giroctod to take al] appropriate measures
authority to ca~ out the provisions of this or
of licenses
includ ng tho suspension asor oftowinatioh
de
tho
4ate
of
this or»Aa»
effect
in
ns
on
ti
other authorise
Executive Order NO. 1272$ of August 2, 1990, iaAll
vith this or4er.
evoked to tho extent ihcohsistent licenses
ahd other
les rogulat iona orders,
The

„' ~

.

"""'-' -'. ;,i.. . .i...". -.-, .. . . ,.. .""
'.

shall

zamaih

ful] force
in fu

,

4 i i trativoly
272$ and not revoked
under
this
order unt il
and effect
more

The
or terminated by proper authority.
of any provision of Executive Order No. 1%723
pursuant to this section shall not affect any violation of
orders, licenses, or other forms of
any rules, regulations,
administrative action under that order during the period
that such provision of that order vas in effect.
This order shall be transmitted to the Congress and
amended,

revocation

modified,

CEOROE

THE WHITE HOUSE,

August

S, ISSO.

tf

P

IUIH

amended,

modified,

or tenainated by proper authority.
of Executive Order No 12723The
pursuant to this section shall
not affect any violation of
any rules, re~lations,
orders,
or other forms of
administrative action under that licenses&
order during the period
that such provision
of that order vas in effect.
This order shall be transmitted to
the Con~ass and
published in the
revocation

of

any provision

~

GEORGE SUSH

THE WHITE HOUSE

Au~st 9,

p

1&SO.

If

8

AUG

Dear Mr.

05

Patrikis:

about the status of various banks under
Executive Order No. 12723 signed hy President Bush on
August 2, 1990, blocking all property in vhich the Government
of Kuwait has an interest. We have had only a brief time to
consider this question and, based on the information
available to us vithin this period and consultation vith the
Government of Kuwait, ve have determined that the banks
listed below in Category I should be considered blocked
entities owned hy the Government of Kuwait.
You have asked

Category ZI contains the names of hanks that should not be
considered blocked entities, based on the information
available to us at this time. However, ve vill need further
information from these hanks hy August 18, concerning their
ownership and control, if they are to continue to be included
in Category

II.

III

of hanks in vhich the
Government of Kuwait and the government of another country
subject to sanctions under the International Emergency
Economic Powers Act each have a substantial ownership
interest. We are reviewing with these institutions relevant
issues pertaining to ownership and control. We anticipate
regarding their status hy
making a final determination
August 18, 1990. In the meantime, ve are licensing
transactions between these banks and persons subject to the
jurisdiction of the United States. The range of such
licensed transactions vill he the same as the range of
permitted transaction between persons subject to the
jurisdiction of the United States and banks listed in
Category II. No such transactions may result in the transfer
of funds to the Government of Kuwait or the Government of
Category

contains the

names

Iraq.

Finally, Category, IV banks are those in vhich ve have learned
the Government of Kuwait has such a significant financial
stake by virtue of loans and guarantees as to be considered
in de facto control and, thus, these banks are also blocked.
The limitation applicable to transactions hy persons subject
to U. S. jurisdiction vith Category I banks vill also be
appliable to transactions by cuch persons vith Category ZV
banks.

1SSO

AU6
Dear Mr.

05

Patrikis:

the status of various hanks under
Executive Order No. 12723 signed by President Bush on
August 2, 1990, blocking all property in vhich the Government
of Kuwait has an interest. We have had only a brief time to
consider this question and, based on the information
available to us vithin this period and consultation vith the
Government of Kuwait, ve have determined that the hanks
listed below in Category Z should he considered blocked
entities owned hy the Government of Kuwait.
You have asked about

Category ZI contains the names of banks that should not he
considered blocked entities, based on the information
available to us at this time. However, ve vill need further
information from these banks by August 18, co~cerning their
ownership and control, if they are to continue to he included
in Category ZI.

III

of hanks in vhich the
of Kuwait and the government of another country
subject to sanctions under the International Emergency
Economic Powers Act each have a substantial ownership
interest. We are reviewing with these institutions relevant
issues pertaining to ownership and control. We anticipate
making a final determination
regarding their status hy
August 18, 1990. Zn the meantime, ve are licensing
transactions between these banks and persons subject to the
jurisdiction of the United States. The range of such
licensed transactions will be the same as the range of
permitted transaction between persons subject to the
jurisdiction of the United States and hanks listed in
Category II. No such transactions may result in the transfer
of funds to the Government of Kuwait or the Government of
Category

Government

contains the

names

Zraq.

Finally, Category IV hanks are those in vhich ve have learned
the Government of Kuwait has such a significant financial
stake by virtue of loans and guarantees as to he considered
in de facto control and, thus, these hanks are also blocked.
The limitation applicable to transactions hy persons subject
to U. S. jurisdiction vith Category Z hanks vill also he
applicable to transactions hy such persons vith Category ZV
hanks.

tSSO

ROTOR
Sank of Kuwait
Surgan Bank

Central
Credit
Kuvait
Savings

Bank

S

Middle East

of Kuvait

de Bergues

Finance House

and Credit Bank

GO

Bahrain Middle East Ban)c
Banco Atlantico

Dao Heng Sank

Gulf International Bank B.S.C.
Kuvait and Bahrain Bank
Kuvait French Bank
Kuwait Real Estate Bank
National Bank of Kuvait
Swiss Kuwaiti Bank
VBAF Arab American

Bank

United Bank of Kuvait
GORY

Arab
Arab
Arab
Arab

African International

Banking Corp
Hellenic Bank

Bank

Turkish Bank
Banco Arabe Espanol
V

GO

Al-Ahlie

Bank of Kuvait
Bank of Kuvait
Industrial Bank of Kuvait
The Gulf Bank

Commercial

Since ely

R. Richard Nevco
Director
Office of Foreign Assets Control
Ernest T. Patrikis

General

Counsel and

Executive Vice President
Federal Reserve Bank of Nev York
33 Liberty Street
Nev York, Nev York l0045

Sank of Kuwait S Middle East
Surgan Bank
Central Bank of Kuwait
Credit de Bergues
Kuwait Finance House
Savings and Credit Sank
GOR

Bahrain Middle East Sank
Banco Atlantico

Dao Heng Bank

Gulf International Bank B.S.C.
Kuwait and Bahrain Bank
Kuwait French Bank
Kuwait Real Estate Bank
National Bank of Kuwait
Swiss Kuwaiti Bank
American Bank
Bank of Kuwait

UBAF Arab

United

GORY

Arab
Arab
Arab
Arab

African International

Bank

Banking Corp

Hellenic Bank

Turkish Bank
Banco Arabe Espanol
V

GO

Bank of Kuwait
Bank of Kuwait
Industrial Bank of Kuwait
The Gulf Bank

Al-Ahlie

Commercial

Since ely

R. Richar& Nevco
Director
Office of Foreign Assets Control
Ernest T. Patrikis
General

Counsel and

Executive Vice President
Federal Reserve Bank of New York
33 liberty Street
10045
New York, New York

DEPARTMENT OF THE TREASURY
WASHINGTON

AU6

Patrikis:
letter to you of

i2

tggtj

Dear Mr.

5, 1990, I set forth the status
of various banks under Executive Order No. 12723. Since
that date we have received additional information concerning
certain banks listed in Category II of that letter regarding
their ownership and control. Based on the information we
have received, we have determined that the following banks
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,
1990:
Bahrain Middle East Bank
In

my

August

Dao Heng Bank

BankGulf International
Bank of Bahrain and Kuwait
Kuwait French Bank
National Bank of Kuwait
Swiss Kuwaiti Bank
UBAF

Arab American

Bank

United Bank of Kuwait
We

have determined
with those

included

that the following

listed in Category

bank should
IV
e. ,

(i.

be

blocked):

Estate Bank
We will complete our review of the status of the remaining
bank in Category II shortly.
The fact that we have yet to
complete our review of this bank should not be viewed as an
indication that its (not-blocked) status will change.
Sincerely,
Kuwait Real

Richard

Newcomb

Director
Office of Foreign Assets Control
Ernest T. Patrikis

General

Counsel

and

Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New

York,

New

York

10045

DEPARTMENT OF THE TREASURY.
WASHINGTON

AU6

Patrikis:
letter to you of

i 2'tggtj

Dear Mr.

5, 1990, I set forth the status
of various banks under Executive Order No. 12723. Since
that date we have received additional information concerning
certain banks listed in Category II of that letter regarding
their ownership and control. Based on the information we
have received, we have determined that the following banks
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,
1990:
In

my

August

Bahrain Middle East Bank
Dao Heng Bank

Gulf International
BankBank of Bahrain and Kuwait
Kuwait French Bank
National Bank of Kuwait
Swiss Kuwaiti Bank
UBAF

Arab American

Bank

United Bank of Kuwait

that the following bank should be
listed in Category IV (i. e. , blocked):
Kuwait Real Estate Bank
We will complete
our review of the status of the remaining
bank in Category II shortly.
The fact that we have yet to
complete our review of this bank should not be viewed as an
indication that its (not-blocked) status will change.
Sincerely,

We

have determined
with those

included

Richard

Newcomb

Director
Office of Foreign Assets Control
Ernest T. Patrikis
General

Counsel

and

Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New

York,

New

York

10045

DEPARTMENT OF THE TREASURY
WASHINCTON

FXC No.

AOG

118307

15 1990

Patrikis:
letter to you of

Dear Mr.

Zn my
August 5, 1990, I set forth the status
of various harder under Lvecutive Order No. 12723. Since that
date we have received additional information concerning
certain hanks listed in Categories IZ & IIX of that letter
regarding their ownership and control. Based on that
information, we have determined that the following banks
should not be considered blocked entities under Executive
Order No. 12723 and. Executive Order No. 127?5 of August 9,
1990:

Arab BazQcing Corporation

Banco Atlantico

Ve

will complete our review of the status of the remaining
in Category IIZ shortly.

banks

Sincerely,
Richard. Newco

Director
Office of Foreign Assets Control
Ernest T. Patrikis

Ceneral Counsel and
Executive Vice President
Federal Reserve Bank of New Tork
33 Liberty Street
New York, New York
10045

FOREIG~ ASSETS

~~~

PA.

DEPARTMENT OF THE TREASVRY
WASHINGTON

PXC No.

118307

AUG

15 1990

Patrikis:
letter to you of

Dear Mr.

Zn my
August 5, 1990, I set forth the status
of various banks under Executive Order No. 12723. Since that
date we have received additional information concerning
certain banks listed in Categories ZZ & III of that letter
regarding their ownership and control. Based on that
formation, we have determined that the following ban3cs
should not be considered blocked entities under Zxecutive
Order No. 12723 and Executive Order No. 12725 of August 9,

1990

Arab Banking Corporation
Banco Atlantico
VTe

will complete our review of the status of the remaining
in Category IZE shortly.

banks

Sincerely,
Richard

Newco

Director
Office of Foreign Assets Control
Ernest T. Patri)Us

Ceneral Counsel and
Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New York, New York
10045

4j 002

LI DEBT E
of the Treasury

Department

+ Bureau

FOR IMMEDIATE RELEASE

II„I

13, 1990

August

of the Public Debt

~.. ~vL

~

Washington,

l, i9d CONTACT;

DC 20239

Office of Financing
202/376-4350

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS
I

Tenders for $9r239 million of 13-week bills and for $9r219
million
of 26-week bills, both to be issued on August 16, 1990, were accepted today.
OF ACCEPTED
COMPETITIVE BIDS: maturin

RANGE

Investment

7 ' 38%

7. 41%
7. 41%

High

Average

Tenders
Tenders

15, 1990

November

Discount
Low

bills

13-week

7. 62%

98. 135 :

7

98 ' 127
98. 127

66%a

7. 66%

:
:

26-week bills
14 1991
Februar
maturin
Investment
Discount
Price
Rate 1
Rate
96. 320
7. 66%
7. 28%
96. 299
7 32%
7. 71%
96. 304
7. 31%
7. 70%

at the high discount rate for the 13-week bills
at the high discount rate for the 26-week bills

allotted
allotted

were
were

64'
30%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

Location
Boston

Received
$

York

New

Philadelphia
Cleveland
Richmond

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

40, 195
25, 932, 665
24, 535
57, 800
123, 190
35, 765
2, 016, 940

41, 890
19, 570
38, 485
38, 405
853, 905
809, 805
$30, 033, 150

Dallas
San Francisco
Treasury
TOTALS

~Te

Competitive
$25, 754, 765
Noncompetitive
1, 756, 525
Subtotal, Public$27, 511,290
Federal Reserve
2, 382, 710
Foreign Official
139, 150
Institutions

$30, 033, 150

TOTALS
An

I

cash.
te

n&r

ted
Ance

$

40, 195
7, 545, 130
24, 535
57, 800

89, 190
35, 405
321, 500
21, 890
12, 770
38, 485
28, 405
213, 690
809, 805
$9, 238, 800

ted
Ance

Received
$

36, 540
23, 677, 505
26, 200
43, 095
53, 935

$

36, 540
7, 825, 805
26, 200
43, 095
53, 935

33 335

33 335

1, 851, 080
23, 545
7, 310
49, 095
29, 965
717, 075

316, 080
18, 145
7, 310
49, 095
21, 465
142, 375
645, 160

645, 160
$27, 193, 840

$9, 218, 540

$4, 960, 415
1, 756, 525
$6, 716, 940
2, 382, 710

$23, 029, 425

$5, 054, 125

139, 150
$9, 238, 800

493, 350
$27, 193, 840

1, 321, 065
$24, 350, 490
2, 350, 000

1, 321, 065

$6, 375, 190
2, 350, 000

493, 350
$9, 218, 540

$19,050 thousand of 13-week bills and an additional $53, 650
of 26-week bills will be issued to foreign official institutions for

additional

thousand
new

(In Thousands)

ftra 1 cent

r

ntrnnn

C

t.'ce etc

yield

yiehSQp

LI DEBT E
Department

+ Bureau

of the Treasury

FOR IMMEDIATE RELEASE

August

'

l'ti;,

13, 1990

i

't ~~

of the Pubh'c Debt

0

~ Washington,

DC 20239

Office of Financing

CONTACT'

202/376-4350

I

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS
ii

million
Tenders for $9~239 million of 13-week bills and for $9d219
of 26-week bills, both to be issued on August 16, 1990, were accepted today.
OF ACCEPTED
COMPETITIVE BIDS: maturin

RANGE

High

Tenders
Tenders

Investment

7. 38%
7. 41%
7. 41%

Average

15, 1990

November

Discount
Low

bills

13-week

7. 62%
7. 66%
7. 66%

98. 135
98. 127
98. 127

26-week bills
14
Februar
maturin
Discount Investment
Rate

7. 28%
7. 32%
7. 31%

at the high discount rate for the 13-week bills
at the high discount rate for the 26-week bills

7. 66%
7. 71%
7. 70%
were
were

1991

96. 320
96. 299
96. 304

allotted
allotted

64'
30%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)
ted
Ance

Received

Location
Boston

Received

36, 540
23, 677, 505
26, 200
43, 095
53, 935

ted
36, 540
$
7, 825, 805
26, 200
43, 095
53, 935
~Acce

40, 195
7, 545, 130
24, 535
57, 800
89, 190
35, 405
321, 500
21, 890
12, 770
38, 485
28, 405
213, 690
809, 805
$9, 238, 800

$

7, 310
49, 095
29, 965
717, 075
645, 160
$27, 193, 840

142, 375
645, 160
$9, 218, 540

$25, 754, 765
Competitive
Noncompetitive
1, 756, 525
Subtotal, Public$27, 511,290
Federal Reserve
2, 382, 710
Official
Foreign
139, 150
Institutions

$4, 960, 415
1, 756, 525
$6, 716, 940
2, 382, 710

$23, 029, 425
1, 321, 065
$24, 350, 490
2, 350, 000

$5, 054, 125
1, 321, 065
$6, 375, 190
2, 350, 000

139, 150

$30, 033, 150

$9, 238, 800

493, 350
$27, 193, 840

493, 350
$9, 218, 540

New

$

York

Philadelphia
Cleveland
Richmond

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

40, 195
25, 932, 665
24, 535
57, 800
123, 190
35, 765
2, 016, 940

41, 890
19, 570
38, 485

Dallas
San Francisco
Treasury

38, 405
853, 905
809, 805
$30, 033, 150

TOTALS

~Te

TOTALS

$

thousand

33 j 335

316, 080
18, 145
7, 310
49, 095
21, 465

$19,Q5Q thousand of 13-week bills and an additional $53, 650
of 26-week bills will be issued to foreign official institutions for

addltjona]
new

33 335
1, 851, 080
23, 545

cash.

1/ Eauivalent

couoon-issue

yield.

DEPARTMENT OF THE TREASURY
WASH INCTON

PXC No.

118307

AUG

15 1990

Dear Mr. Patri3cis:

letter to you of August. 5, 1990, I set forth the status
of various banks under Executive Order No. 12723. Since that
date we have received additiona1 information concerning
certain banks listed in Categories II 0 III of that letter
regarding their ownership and control. Based on that
information, we have determined that the following bazQss
should not be considered blocked entities under Zxecutive
Order No. 12723 and Executive Order No. 12725 of August 9,
Zn my

1990=

Arab Banlcing Corporation

Banco Atlantico

will complete our review of the status
banks in Category III short1y.

VTe

of the remaining

Sincerely,
Richard

Newco

Director
Office of Foreign Assets Control
Ernest T. Patrikis

Ceneral Counsel and
Executive Vice President
Federal Reserve Bank of New

33 Liberty
New York,

Street

New

York

10045

cwork

DEPARTMENT OF THE TREASURY
WASH INCTON

FA.C

AUG

No. 3.18307

15 1990

Patrikis:
letter to you of

Dear Mr.

August 5, 1990, I set forth the status
of various banks under Executive order No. 12723. Since that
date we have received additional information concerning
certain banks listed in Categories ZI E IIZ of that letter
regarding their ownership and control. Based on that
information, we have determined that the following ban3cs
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,
1990:
Zn my

Arab Baz&ing Corporation
Banco Atlantico

will. complete our review of the status of the remaining
banks in Category III shortly.

Ve

Sincerely,
Richard

Newco

Director
Office of Foreign Assets Contxol
Ernest T. Patrikis

Qeneral

Counsel

and

Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New York, New York
10045

Removal Notice
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Citation Information
Document Type: Transcript

Number of Pages Removed: 36

Author(s):
Title:

Treasury Department Briefing (On Background)

Date:

1990-08-13

Journal:

Volume:
Page(s):
URL:

Federal Reserve Bank of St. Louis

https://fraser.stlouisfed.org

DEPARTMENT OF THE TREASURY
WASHIHGTON

Acknowledgment

AUGUST

5, l990

of Filing of Statements

of Kuwait has filed statements concerning
certain Kuwaiti-controlled firms in the U. S. Accordingly
U. S. financial institutions
are hereby authorized until
August 25, 1990, to accept deposits and clear checks written
on the blocked accounts of the Kuwaiti-controlled
firms in
the United States listed below (including their subsidiaries
and affiliates) and in general to operate such firms'
blocked bank accounts, provided that no benefit to the
Government of Zraq arises from transactions in the blocked
The Embassy

accounts:

Santa Fe Znternational

Corporation

Fosterlane Holdings Corporation
Crescent Holdings, Znc.
Nafra Zntervest Corporation (Cayman)
KFZC,

Znc.

Georgetown

Zndustries,

Znc.

questions regarding this acknowledgment may be directed
to the Blocked Assets Section, Office of Foreign Assets

Any

Control, Department of the Treasury,
(telephone 202-535-4026).

R. Richard

Washington,

Newco

D. C. 20220

Director
Office of Foreign Assets Control

DEPARTMENT OF THE TREASURY

AUGUST

WASKIHCTOH

Acknowl edgment

5, 1990

of Filing of Statements

of Kuwait has filed statements concerning
certain Kuwaiti-controlled firms in the U. S. Accordingly,
U. S. financial institutions
are hereby authorized until
to
August 25, 1990,
accept deposits and clear checks written
on the blocked accounts of the Kuwaiti-controlled
firms in
the United States listed below (including their subsidiaries
and affiliates) and in general to operate such firms '
blocked bank accounts, provided that no benefit to the
Government of Iraq arises from transactions in the blocked
The Embassy

accounts:

Santa Fe International

Corporation

Fosterlane Holdings Corporation
Crescent Holdings, Inc.
Vafra Intervest
KFZC,

(Cayman)

Inc.

Inc.
questions regarding this

Georgetown
Any

Corporation

Industries,

acknowledgment

may

be directed

to the Blocked Assets Section, Office of Foreign Assets
Control, Department of the Treasury,
(telephone 202-535-4026).

R. Richard

washington,

Newco

D. C. 20220

Director
Office of Foreign Assets Control

icmrtment

of the Treasury

FOR IMMEDIATE

August

RELEASE

3, 1990

THE TREASURY DEPARTMENT

1.

~

Washington,

Contact:

Telephone 566-204~

~

Barbara Clay, 566-2041
Cheryl Crispen, 566-5252

TODAY ANNOUNCED

OIL CONTRACTS ENTERED INTO PRIOR
ENROUTE

D.C.

THE FOLLOWING

TO AUGUST

2

ACTIONS:

1990

AND

TO'THE UNITED STATES

Importation 'of Iraqi and Kuwaiti oil will be permitted where
(1) the oil was loaded prior to the effective date (5:01 a. m.
Eastern Daylight Time (EDT), August 2, 1990), was intended for
ultimate delivery to 'the United States, and was imported into the
United-States before 11:59 p. m. EDT, -October 1, -1990; (2) the
Bill of Lading was issued prior to the effective date; (3) any
balance not yet paid to Iraq or Kuwait for the shipment must be
paid into a blocked account in the United States; and (4) such
transaction is reported to the Blocked Assets Section, Office of
Foreign Assets Control.

2.

TRANSACTIONS

OF KUWAITI-CONTROLLED

U. S. FIRMS

license will be issued authorizing U. S. financial
institutions to accept deposits and clear checks written on the
firms in the United
blocked accounts of Kuwaiti-controlled
States, and in general to operate such firms' blocked bank
accounts, provided that no benefit to the Government of Iraq
arises from transactions in the blocked accounts. In order to
firms will be
utilize the general license, Kuwaiti-controlled Assets
Control's
required to register with the Office of Foreign
such
institutions
holding
Financial
Section.
Blocked Assets
that
had
registration
to
verify
firms' accounts will be required
day-to-day
financial
occurred. This will facilitate the normal
States
and
United
permit
the
in
firms
Kuwaiti
functions of
payment of employees and creditors and the purchase of goods and
services in the ordinary course of the firms' business.

A

general

artment of the Treasury

FOR IMMEDIATE

August

3, 199 0

RELEASE

THE TREASURY DEPARTMENT

~

Washington,

Contact:

Barbara Clay, 566-2041
Cheryl Crispen, 566-5252

TODAY ANNOUNCED

OIL CONTRACTS ENTERED INTO PRIOR
ENROUTE

D.c. a Teleghono 566-204~

THE FOLLOWING

TO AUGUST

2

TO THE UNITED STATES

ACTIONS:

1990

AND

Importation 'of Iraqi and Kuwaiti oil will be permitted where
(1) the oil was loaded prior to the effective date (5:01 a. m.
Eastern Daylight Time (EDT), August 2, 1990), vas intended for
ultimate delivery to 'the United States, and was imported into the
United States before 11:59 p. m. EDT, -October 1, -1990; (2) the
Bill of Lading was issued prior to the effective date; (3) any
balance not yet paid to Iraq or Kuwait for the shipment must be
paid into a blocked account in the United States; and (4) such
transaction is reported to the Blocked Assets Section, Office of
Foreign Assets Control.

2.

TRANSACTIONS

OF KUWAITI-CONTROLLED

U. S. FIRMS

license will be issued authorizing U. S. financial
institutions to accept deposits and clear checks written on the
firms in the United
blocked accounts of Kuwaiti-controlled
firms' blocked bank
such
to
operate
States, and in general
accounts, provided that no benefit to the Government of Iraq
arises from transactions in the blocked accounts. In order to
utilize the general license, Kuwaiti-controlled firms vill be
required to register with the Office of Foreign Assets Control's
Blocked Assets Section. Financial institutions holding such
firms' accounts will be required to verify that registration had
occurred. This will facilitate the normal day-to-day financial
functions of Kuwaiti firms in the United States and permit
payment of employees and creditors and the purchase of goods and
services in the ordinary course of the firms' business.

A

general

3.

REINVESTMENT

AUTHORITY

In the management of portfolio investments and securities blocked
to Executive Order 12723 representing interests of the

pursuant

of Kuwait, hank and investment companies will be
authorized to manage such blocked property and to reinvest the
proceeds of such property in assets subject to the jurisdiction
in the United States, provided that no investment results in an
otherwise prohibited transfer of financial or economic benefit to
the Government of Iraq. Prior to engaging in any transaction
pursuant to this general license, the U. S. person must register
with the Blocked Assets Section, Office of Foreign Assets
Control, and provide regular reports as directed concerning such
transactions.
Government

4.

COMPLETION

OF FOREIGN EXCHANGE

CONTRACTS

Foreign exchange contracts entered into for the account of the
Government

of

Kuwait

prior to 5:00 a. m.

EDT, August

2, 1990,

expects to issue regulations

shortly.

may

be completed, provided:
(1) all exchange transactions are
completed prior to August 16, 1990; (2) funds are received in the
U. S. prior to payment; and (3) all payments received for the
account of the Government of Kuwait go into a blocked account.
-.

The Treasury 'Department

3.

REINVESTMENT

AUTHORITY

In the management of portfolio investments and securities blocked
pursuant to Executive Order 12723 representing interests of the

of Kuwait, bank and investment companies will be
authorized to manage such blocked property and to reinvest the
proceeds of such property in assets subject to the jurisdiction
in the United States, provided that no investment results in an
otherwise prohibited transfer of financial or economic benefit to
the Government of Iraq. Prior to engaging in any transaction
pursuant to this general license, the U. S. person must register
with the Blocked Assets Section, Office of Foreign Assets
Control, and provide regular reports as directed concerning such
Government

transactions.

4.

COMPLETION

OF FOREIGN EXCHANGE

CONTRACTS

Foreign exchange contracts entered into for the account of the
Government

of

Kuwait

prior to 5:00 a. m.

EDT, August

2, 1990,

may

be completed, provided:
(1) all exchange transactions are
to
completed prior
August 16, 1990; (2) funds are received in the
U. S.

prior to payment;

and

account of the Government

all payments received
Kuwait go into a blocked

(3)

of

for the

account.

4:

-:The

Treasury

Department

expects to issue regulations

shortly.

DEPARTMENT OF THE TREASVRY
W ASHIER G TON

AUG

Dear Nr.

05

Patrikis:

the status of various banks under
Executive Order No. 12723 signed by President Bush on
August 2, 1990, blocking all property in which the Government
of Kuwait has an interest. We have had only a brief time to
consider this question and, based on the information
available to us within this period and consultation with the
Government of Kuwait, we have determined that the banks
listed below in Category I should be considered blocked
entities owned by the Government of Kuwait.
You have asked about

Category II contains the names of banks that should not be
considered blocked entities, based on the information
available to us at this time. However, we will need further
information from these banks by August 18, concerning their
ownership and control, if they are to continue to be included
in Category

II.

III

contains the names of banks in which the
of Kuwait and the government of another country
subject to sanctions under the International Emergency
Economic Powers Act each have a substantial ownership
interest. We are reviewing with these institutions relevant
issues pertaining to ownership and control. We anticipate
regarding their status by
making a final determination
we are licensing
1990.
In
the
meantime,
August 18,
transactions between these banks and persons subject to the
jurisdiction of the United States. The range of such
licensed transactions will be the same as the range of
permitted transaction between persons subject to the
jurisdiction of the United States and banks listed in
Category II. No such transactions may result in the transfer
of funds to the Government of Kuwait or the Government of
Category

Government

Iraq.

Finally, Category TV banks are those in vhich ve have learned
the Government of Kuwait has such a significant financial
stake by virtue of loans and cparantees as to be considered
in de facto control and, thus, these banks are also blocked.
The limitation applicable to transactions by persons subject
to U. S. jurisdiction with Category I banks vill also be
applicable to transactions by cuch persons vith Category
banks.

~

1990

DEPARTMENT OF THE TREASuRY
W A SHIN C TON

AUG

Dear Mr.

05

Patrikis:

the status of various banks under
Executive Order No. 12723 signed by president Bush on
August 2, 1990, blocking all property in vhich the Government
of Kuwait has an interest. We have had only a brief time to
consider this question and, based on the information
available to us vithin this period and consultation vith the
Government of Kuwait, ve have determined that the hanks
listed below in Category I should he considered blocked
entities owned hy the Government of Kuwait.
You have asked about

Category II contains the names of hanks that should not he
considered blocked entities, based on the information
available to us at this time. However, ve vill need further
information from these hanks hy August 18, concerning their
ownership and control, if they are to continue to be included
in Category IZ.

III

names of banks in vhich the
the
government of another country
Government of
subject to sanctions under the International Emergency
Economic Powers Act each have a substantial ownership
interest. We are reviewing vith these institutions relevant
issues pertaining to ownership and control. We anticipate
regarding their status by
making a final determination
August 18, 1990. In the meantime, ve are licensing
transactions between these hanks and persons subject to the
jurisdiction of the United States. The range of such
licensed transactions vill he the same as the range of
permitted transaction between persons subject to the
jurisdiction of the United States and banks listed in
No such transactions
Category
may result in the transfer
of funds to the Government of Kuwait or the Government of

Category

contains the
Kuwait

and

II.

Iraq.

Finally, Category IV hanks are those in which ve have learned
the Government of Kuvait has such a significant financial
stake by virtue of loans and guarantees as to be considered
in de facto control and, thus, these banks are also blocked.
The limitation applicable to transactions hy persons subject
to U. S. jurisdiction with Category I banks vill also be
applicable to transactions hy cuch persons vith Category ZV
hanks.

1990

gP

T~

Sank of Kuwait 4 Middle East
Burgan Bank
Central Bank of Kuwait
Credit de Sergues
Kuwait Finance House
Savings and Credit Bank
GO

Bahrain Middle East Bank
Banco Atlantico

Dao Heng Bank

Gulf International Bank B.S.C.
Kuwait and Bahrain Bank
Kuwait French Bank
Kuwait Real Estate Bank
National Bank of Kuvait
Swiss Kuwaiti Bank
USAF Arab American

Bank

United Bank of Kuvait
A

Arab
Arab
Arab
Arab

GORY

African International

Sank

Banking Corp

Hellenic Bank

Turkish Bank
Banco Arabe Espanol
GO

Bank of Kuwait
Commercial Bank of Kuvait
Industrial Bank of Kuvait
The Gulf Bank

Al-Ahlie

Since ely
R. Richard Newco
Director
Office of Foreign Assets Control

Ernest T. Patrikis

General Counsel and

Executive Vice President
Federal Reserve Bank of Nev York
33 Liberty Street
Nev York, New York 10045

CATHER
Sank of Kuvait
Burgan Bank

Central
Credit
Kuvait
Savings

4

Middle East

of Kuvait
de Sergues
Bank

Finance House
and

Credit Bank

GOR

Bahrain Middle East Bank
Banco Atlantico

Dao Heng Bank

Gulf International Bank B.S.C.
and Bahrain Bank
French Bank
Kuvait Real Estate Bank
National Bank of Kuvait
Swiss Kuwaiti Bank
Kuwait
Kuwait

UBAF

Arab American

Bank

United Bank of Kuvait
A

Arab
Arab
Arab
Arab

GORY

African International
Banking

Corp
Hellenic Bank
Turkish Bank
Banco Arabe Espanol

Bank

Al-Ahlie

Bank of Kuvait
Bank of Kuvait
Industrial Bank of Kuvait
The Gulf Bank

Commercial

Since ely
R. Richard Nevco
Director
Office of Foreign Assets Control

Ernest T. Patrikis

General Counsel and
Executive Vice Pres'ident
Federal Reserve Bank of Nev York
33 Liberty Street
Nev York, New York 10045

DEPARTMENT OF THE TREASURY"
WASHINGTON

AU6

f 2'199tj

Patrikis:
letter to you of

Dear Mr.

August, 5, 1990, I set. forth the status
banks
various
under
Executive Order No. 12723. Since
of
that date we have received additional information concerning
certain banks listed in Category II of that letter regarding
their ownership and control. Based on the information we
have received, we have determined that the following banks
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,

In

my

1990:

Bahrain Middle East Bank
Dao Heng

Bank

Gulf International
BankBank of Bahrain and Kuwait
Kuwait French Bank
National Bank of Kuwait
Swiss Kuwaiti Bank
American Bank
Bank of Kuwait

UBAF Arab

United

We

have determined

with those

included

that the following

listed in Category

Kuwait

bank should
IV
e. ,

(i.

be

blocked):

Real Estate Bank

will complete our review of the status of the remaining
bank in Category II shortly.
The fact that we have yet to
complete our review of this bank should not be viewed as an
indication that its (not-blocked) status will change.
We

Sincerely,
Richard

Newcomb

Director
Office of Foreign Assets Control
Ernest T. Patrikis
General

Counsel

and

Executive Vice President
Federal Reserve Bank of New York
33 Liberty Street
New

York,

New

York

10045

DEPARTMENT OF THE TREASURY. WASHINGTON

AU6

12'1999

Patrikis:
letter to you of

Dear Mr.

August 5, 1990, I set forth the status
my
of various banks under Executive Order No. 12723. Since
that date we have received additional information concerning
certain banks listed in Category II of that letter regarding
their ownership and control. Based on the information we
have received, we have determined that the following banks

In

should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,

1990:

Bahrain Middle East Bank
Dao Heng Bank

Gulf International
BankBank of Bahrain and Kuwait
Kuwait French Bank
National Bank of Kuwait
Swiss Kuwaiti Bank
American Bank
Bank of Kuwait

UBAF Arab

United

We

have determined

included

with those

that the following

listed

bank should
e. ,
in Category IV

(i.

be

blocked):

Estate Bank
We will complete
our review of the status of the remaining
bank in Category II shortly.
The fact that we have yet to
complete our review of this bank should not be viewed as an
indication that its (not-blocked) status will change.
Kuwait Real

Sincerely,
Richard

Newcomb

Director
Office of Foreign Assets Control
Ernest T. Patrikis
General

Counsel

and

Executive Uice President
Federal Reserve Bank of New York
33 Liberty Street
10045
New York, New York

partment of the Treasury

~

Washington,

O.C. ~

telephone 56$-RO4~

TEXT AS P REPARED
EMBARGOED FOR RELEASE UPON DELIVERY
EXPECTED AT l0:00 A. M. DST

STATEMENT BY
THE HONORABLE DAVID C. MULFORD
UNDER SECRETARY OF THE TREASURY FOR INTERNATIONAL AFFAIRS
BEFORE THE COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS
U.
HOUSE OF REPRESENTATIVES

S.

August
Mr. Chairman

and Members

14, 1990

of the Committee:

The Treasury Department welcomes this opportunity
to discuss
with you issues relating to (1) U. S. intervention
in the foreign
exchange markets, and the use of the Exchange Stabilization Fund
in these and in other
(ESF) to finance Treasury's participation
foreign exchange operations, and (2) U. S. support of "Brady Plan"
measures designed to reduce the debt and debt service burden of
debtor nations that are undertaking economic reforms.
I believe
these hearings will provide a useful supplement to our appearances
every six months before the Committee, and its Subcommittee on
International Finance, Trade and Monetary Policy, to discuss our
economic and exchange rate
periodic reports on international

policy.

The

first part of

the ESF, including
Brady Plan

NB-920

issues.

my

statement

intervention.

will address issues related to
The second part will address

apartment of the treasury

~ Washlnyton,

O.C. ~ Telephone 168-2041

TEXT AS PREPARED
EMBARGOED FOR RELEASE UPON DELIVERY
EXPECTED AT 10:00 A. M. DST

STATEMENT BY
THE HONORABLE DAVID C. MULFORD
UNDER SECRETARY OF THE TREASURY FOR INTERNATIONAL AFFAIRS
BEFORE THE COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS
U.
HOUSE OF REPRESENTATIVES

S.

August
Mr. Chairman

and Members

14, 1990

of the Committee:

The Treasury Department welcomes this opportunity
to discuss
with you issues relating to (1) U. S. intervention
the
in
foreign
exchange markets, and the use of the Exchange Stabilization Fund
in these and in other
(ESF) to finance Treasury's participation
foreign exchange operations, and (2) U. S. support of "Brady Plan"
measures designed to reduce the debt and debt service burden of
debtor nations that are undertaking economic reforms.
I believe
these hearings will provide a useful supplement to our appearances
every s ix months before the Committee, and its Subcommittee on
International Finance, Trade and Monetary Policy, to discuss our
ec'. onomic
and exchange
rate
periodic reports on international

policy.

The

first part of

the ESF, including
Brady Plan

NB-920

issues.

my

statement

intervention.

will address issues related to
The second part will address

Exchan e

Stabilization

Fund

to a nation's
and
give meaning
order to support
international financial policy, its monetary authorities require a
For the United
mechanism to undertake foreign exchange operations.
States Government, that instrument is the Exchange Stabilization
of the Treasury.
Fund in the Department
In

of the
has
beneficial,
financial markets which, while
changed the nature and scope of strains on the balance of payments
adjustment process. For industrialized countries, there is greater
Within the past
latitude for the exchange rate to fluctuate.
decade, problems of indebtedness have arisen for some developing
countries, with serious implications for world financial markets.
Short-term "bridge loans", extended under exacting standards, have
played a role in dealing with these problems.
within the U. S.
The Treasury's
ESF is the only instrument
Government which is constituted and empowered to respond rapidly
and flexibly to international
which can
financial disruptions,
impact adversely on production, employment and prices in the U. S.
economy.
It enables the United States to fulfill our
responsibilities
and exercise
in world financial
leadership
while
affairs,
still subjecting the extent and nature of its
operations to the close scrutiny of the Congress.
Pur ose and Authorit
for Transactions

The preceding
world economy and

two decades have witnessed

globalization

The ESF was created by Section 10 of the Gold Reserve Act of
1934, which is now codified at 31 United States Code Section 5302.
The
current
Section 5302 incorporates
various
amendments,
particularly those reflecting establishment of the International
Monetary Fund and later changes in the IMF's Articles of Agreement.
The ESF provides a powerful and flexible means for the Secretary of
the Treasury, with the approval of the President, to support the
obligations of the United States in the IMF, especially with
respect to the provisions of the IMF's Articles of Agreement which
concern orderly exchange arrangements
and a stable system of

exchange

rates.

provides broad authority
for the Secretary
to deal in gold, foreign exchange and other instruments of
credit and securities the Secretary considers necessary. " It also
provides that the Secretary's decisions "are final and may not be
reviewed by another officer or employee of the Government. "

Section

5302

The legislative
history of the ESF's creation in 1934
demonstrates
that Congress sought to pattern the ESF after the
British exchange equalization fund, which had been successful in
increasing the Bank of England's gold and foreign exchange reserves

Exchan e

In

to

order

support

Stabilization
and

Fund

to a
meaning
monetary authorities

give

nation's
require a

financial policy, its
For the United
mechanism to undertake foreign exchange operations.
States Government, that instrument is the Exchange Stabilization
Fund in the Department of the Treasury.
The preceding two decades have witnessed globalization of the
world economy and financial markets which, while beneficial, has
changed the nature and scope of strains on the balance of payments
adjustment process. For industrialized countries, there is greater
Within the past
latitude for the exchange rate to fluctuate.
decade, problems of indebtedness have arisen for some developing
countries, with serious implications for world financial markets.
Short-term "bridge loans", extended under exacting standards, have
played a role in dealing with these problems.
within the U. S.
ESF is the only instrument
The Treasury's
Government which is constituted and empowered to respond rapidly
which can
financial disruptions,
and flexibly to international
the U. S.
in
and
prices
impact adversely on production, employment
our
It enables the United States to fulfill
economy.
in world financial
leadership
responsibilities
and exercise
of its
and nature
extent
the
while
still
affairs,
subjecting
operations to the close scrutiny of the Congress.
international

for Transactions
The ESF was created by Section 10 of the Gold Reserve Act of
1934, which is now codified at 31 United States Code Section 5302.
various
amendments,
Section 5302 incorporates
The
current
particularly those reflecting establishment of the International
Monetary Fund and later changes in the IMF's Articles of Agreement.
The ESF provides a powerful and flexible means for the Secretary of
the Treasury, with the approval of the President, to support the
obligations of the United States in the IMF, especially with
respect to the provisions of the IMF's Articles of Agreement which
and a stable system of
concern orderly exchange arrangements
Pur ose and Authorit

exchange

rates.

for the Secretary
provides broad authority
to deal in gold, foreign exchange and other instruments of
credit and securities the Secretary considers necessary. " It also
provides that the Secretary's decisions "are final and may not be
reviewed by another officer or employee of the Government. "
Section

5302

The legislative
history of the ESF's creation in 1934
demonstrates
that Congress sought to pattern the ESF after the
British exchange equalization fund, which had been successful in
increasing the Bank of England's gold and foreign exchange reserves

in sharply reducing the British trade deficit.
Congress
from the outset that the "only feasible method" by which
the United States could duplicate the success of the British fund
would be to commit the operations
of the ESF to the exclusive
the
control of
Secretary of the Treasury, and to veil those
operations "in the greatest secrecy. " [78 Cong. Rec. 966 (January
20, 1934)]
and

realized

Throughout the history of the ESF, Congress has chosen not to
limit this broad grant of authority or to subject the ESF to
outside scrutiny or supervision.
Vesting control of the ESF in a
single official reflects Congressional recognition of both the need
for swift action in situations of deteriorating confidence, and the
difficulty of foreseeing the nature and extent of international
financial disturbances.
Although Congress clothed the operations
of the ESF with complete confidentiality,
it has retained its
prerogative for continuing review of the ESF's operations through
periodic reporting on the activities and accounts of the ESF, and
the availability of Treasury officials for public testimony and
informal briefings.
The statute imposes no limits on the volume or composition of
the ESF's assets. Nor does it limit how these assets are employed,
other than that they be employed in a manner consistent with the
obligations of the United States in the International Monetary
Fund.
Purchasing foreign currency for dollars, or dollars for
foreign currency, constitutes dealing in foreign exchange and thus
is clearly authorized by the language of the statute. Purchases of
foreign currency from, and sales of foreign currency to, the
Federal Reserve fall in this category.

to incur
the Secretary has broad authority
liabilities on behalf of the ESF, as specified in his authority to
That is, he may
of credit and securities.
deal in instruments
necessary
to carry
extent
the
to
borrow dollars or foreign exchange
out the purposes of the ESF. However, there is no statutory
provision authorizing the Federal Reserve to lend to the ESF.
Similarly,

In this regard, I would note that another statute, the Special
Drawing Rights Act of 1968, which is codified at 22 U. S.C. 286 and
subsequent sections, provides explicitly for the issuance by the
Secretary of Special Drawing Right Certificates to the Federal
Reserve Banks in exchange for cash in order to finance the
Such certificates,
acquisition of SDRs or other ESF operations.
of
SDRs held by the
value
the
the amount of which cannot exceed
ESF, are currently the only significant entry on the liability side
of the ESF's balance sheet apart from SDR allocations and net,
worth.

in sharply reducing the British trade deficit.
Congress
realized from the outset that the "only feasible method" by which
the United States could duplicate the success of the British fund
would be to commit the operations
of the ESF to the exclusive
control of the Secretary of the Treasury, and to veil those
operations "in the greatest secrecy. " [78 Cong. Rec. 966 (January
20, 1934)]
Throughout the history of the ESF, Congress has chosen not to
limit this broad grant of authority or to subject the ESF to
outside scrutiny or supervision.
Vesting control of the ESF in a
single official reflects Congressional recognition of both the need
for swift action in situations of deteriorating confidence, and the
difficulty of foreseeing the nature and extent of international
financial disturbances.
Although Congress clothed the operations
the
of
ESF with complete confidentiality,
it has retained its
prerogative for continuing review of the ESF's operations through
periodic reporting on the activities and accounts of the ESF, and
the availability of Treasury officials for public testimony and
informal briefings.
The statute imposes no limits on the volume or composition of
ESF's
assets. Nor does it limit how these assets are employed,
the
other than that they be employed in a manner consistent with the
obligations of the United States in the International Monetary
Fund.
Purchasing foreign currency for dollars, or dollars for
foreign currency, constitutes dealing in foreign exchange and thus
is clearly authorized by the language of the statute. Purchases of
foreign currency from, and sales of foreign currency to, the
Federal Reserve fall in this category.
and

to incur
the Secretary has broad authority
his
in
to
authority
as
specified
on behalf of the ESF,

Similarly,

liabilities

That is, he may
of credit and securities.
deal in instruments
borrow dollars or foreign exchange to the extent necessary to carry
out the purposes of the ESF. However, there is no statutory
provision authorizing the Federal Reserve to lend to the ESF.

In this regard, I would note that another statute, the Special
Drawing Rights Act of 1968, which is codified at 22 U. S.C. 286 and
subsequent sections, provides explicitly for the issuance by the
Secretary of Special Drawing Right Certificates to the Federal
Reserve Banks in exchange for cash in order to finance the
Such certificates,
acquisition of SDRs or other ESF operations.
of
SDRs held by the
value
the
exceed
cannot
which
of
the amount
on
the
liability side
entry
ESF, are currently the only significant
of the ESF's balance sheet apart from SDR allocations and net,
worth.

Secretaries of the Treasury are sensitive to the need to
employ their authority judiciously and to keep Congress informed of
their exercise of it and of the financial condition of the ESF,
which, I wish to emphasize, is extremely sound.
Sources of Funds for the ESF
Appended to my statement is the summary balance sheet of the
ESF as of end-1989 (latest published data), which sets forth the
It can be seen from the Liabilities and
sources of ESF funds.
Capital section that the main sources are (a) the substantial
retained earnings accumulated by the ESF, particularly in recent
years, (b) the cumulative allocation of SDRs by the IMF and (c) the
Paid-in
issuance of SDR certificates to the Federal Reserve.
now
ESF
in
1934,
the
to
funds
reflecting
appropriated
capital,
use
of
the
amounts to $200 million after taking into account
$1.8 billion (of the $2 billion of funds originally appropriated in
in the IMF, as
1934) for the initial U. S. quota subscription
provided for in the Bretton Woods Agreements Act of 1945. The item
"Advance from U. S. Treasury" (now $1, 067 million) represents the
residual of a non-interest bearing liability to the General Fund of
the U. S. Treasury resulting from the transfer to the ESF of foreign
currencies purchased from the IMF by the United States in 1978, and
with the
an equivalent amount of dollars are held, interest-free,
General Fund.
This advance was charged to an appropriation
provided in 1976.
In sum, the ESF uses a combination of funds that were either
originally appropriated by Congress or obtained from a source other
than the U. S. Treasury in accordance with the basic legislation for
ESF operations
or other specific authorizing
legislation.
further appropriations
for ESF operations are not
Accordingly,
necessary unless the ESF were to deplete its net worth and be
unable to meet its obligations.
This status reflects the revolving, monetary nature of ESF
transactions, which largely entail the exchange of one monetary
asset for another as contrasted to the purchase of a good or
service.
Warehousin

it

From

time-to-time,

the ESF

may

hold foreign currencies

which

to exchange for dollars in order to execute its
responsibilities.
For example, its holdings of dollars may have
declined because of intervention activity or because of activation
of swap agreements, particularly those entailing "bridge loans" to
indebted countries.
Warehousing
entails a transaction with the
Federal Reserve System in the form of a sale of foreign currency to
the System and a simultaneous repurchase of that foreign currency
for future delivery at the same price, i. e. , a currency swap.
wishes

Secretaries of the Treasury are sensitive to the need to
employ their authority judiciously and to keep Congress informed of
their exercise of it and of the financial condition of the ESF,
which, I wish to emphasize, is extremely sound.
Sources of Funds for the ESF
Appended to my statement is the summary balance sheet of the
ESF as of end-1989 (latest published data), which sets forth the
Liabilities and
It can be seen from the the
sources of ESF funds.
substantial
Capital section that the main sources are (a)
in recent
particularly
the
ESF,
retained earnings accumulated by
and
(c) the
years, (b) the cumulative allocation of SDRs by the IMF
Paid-in
issuance of SDR certificates to the Federal Reserve.
now
in
1934,
ESF
the
to
capital, reflecting funds appropriated
use
of
the
amounts to $200 million after taking into account
$1.8 billion (of the $2 billion of funds originally appropriated in
in the IMF, as
1934) for the initial U. S. quota subscription
provided for in the Bretton Woods Agreements Act of 1945. The item
"Advance from U. S. Treasury" (now $1, 067 million) represents the
residual of a non-interest bearing liability to the General Fund of
the U. S. Treasury resulting from the transfer to the ESF of foreign
currencies purchased from the IMF by the United States in 1978, and
with the
an equivalent amount of dollars are held, interest-free,
This advance was charged to an appropriation
General Fund.
provided in 1976.
In sum, the ESF uses a combination of funds that were either
originally appropriated by Congress or obtained from a source other
than the U. S. Treasury in accordance with the basic legislation for
legislation.
ESF operations
or other specific authorizing
for ESF operations are not
further appropriations
Accordingly,
necessary unless the ESF were to deplete its net worth and be
unable to meet its obligations.
This status reflects the revolving, monetary nature of ESF
transactions, which largely entail the exchange of one monetary
asset for another as contrasted to the purchase of a good or
service.
Warehousin

it

From

time-to-time,

the ESF

may

hold foreign currencies

which

to exchange for dollars in order to execute its
responsibilities.
For example, its holdings of dollars may have
declined because of intervention activity or because of activation
of swap agreements, particularly those entailing "bridge loans" to
indebted countries.
Warehousing entails a transaction with the
Federal Reserve System in the form of a sale of foreign currency to
the System and a simultaneous repurchase of that foreign currency
for future delivery at the same price, i. e. , a currency swap.
wishes

As a warehousing
transaction takes the form of purchases and
sales of one currency against another,
of
no instruments
but
indebtedness are created.
In other words, there is no loan
rather an exchange of assets. For the same reason and because they
serve to facilitate ESF operations, which do not require further
themselves
warehousing
transactions
do not
appropriations,
constitute budget receipts or expenditures, although they usually
generate realized gains or losses, which do affect the budget.
As noted above,
the basic authority to deal in foreign
exchange
provided
in Section 5302 extends
to warehousing
unlike the requirement
operations.
However,
that the Federal
Reserve accept SDR certificates from the Secretary, the authority
in Section 5302 does not obligate the Federal Reserve to agree to

warehousing.

Coordination

of Intervention

Activities with the Federal Reserve

Treasury Department and the Federal Reserve cooperate
While the
closely in undertaking foreign exchange operations.
Secretary of the Treasury is the principal financial officer of the
States and is the United States Governor of the
United
International Monetary Fund, the Chairman of the Board of Governors
of the Federal Reserve System is closely involved in the
determination
of U. S. international financial policy. He is the
Alternate U. S. Governor of the IMF, and he or his representative
participates in many of the other international meetings at which
the United States coordinates international financial policy with
Moreover, he and the Secretary have frequent
other countries.
informal discussions.
The

Treasury welcomes the role of the Federal Reserve both as a
participant with its own funds in U. S. foreign exchange operations
in those
and as an advisor and agent for Treasury's participation
operations. As fiscal agent for the ESF, the Federal Reserve Bank
of New York is legally obliged to execute foreign exchange
operations for the account of the ESF at the direction of Treasury.

Treasury does not have the legal authority to direct the
Federal Reserve System to undertake foreign exchange operations for
the System's account, nor does it have the authority to block
However, we are
operations which the System wishes to undertake.
does
not
constitute a
confident that the lack of such authority
which rests
meaningful constraint on the executive responsibility
for
the
Treasury
decisions
of
Secretary
the
and
with the President
financial
international
policy of the
of the
on and implementation
Close coordination on intervention questions is
United States.
practice of financing equal shares of total
normal
evident in the
division for the most part,
U. S. intervention;
any different
reflects, except in rare instances, technical reasons such as the

respective availabilities

of different currencies.

As a warehousing
transaction takes the form of purchases and
sales of one currency against another,
of
no instruments
indebtedness are created.
In other words, there is no loan but
rather an exchange of assets. For the same reason and because they
serve to facilitate ESF operations, which do not require further
appropriations,
warehousing
transactions
do
not themselves
constitute budget receipts or expenditures, although they usually
generate realized gains or losses, which do affect the budget.
As noted above,
the basic authority to deal in foreign
exchange
provided
in Section 5302 extends
to warehousing
operations.
However,
unlike the requirement
that the Federal
Reserve accept SDR certificates from the Secretary, the authority
in Section 5302 does not obligate the Federal Reserve to agree to

warehousing.

Coordination
The

of Intervention

Treasury

Department

Activities with the Federal Reserve
and

the Federal

Reserve

cooperate

closely in undertaking foreign exchange operations.
While the
Secretary of the Treasury is the principal financial officer of the
United
States and is the United States Governor of the
International Monetary Fund, the Chairman of the Board of Governors
of the Federal Reserve System is closely involved in the
determination
of U. S. international financial policy. He is the
Alternate U. S. Governor of the IMF, and he or his representative
participates in many of the other international meetings at which
the United States coordinates international financial policy with
other countries.
Moreover, he and the Secretary have frequent
informal discussions.
Treasury welcomes the role of the Federal Reserve both as a
participant with its own funds in U. S. foreign exchange operations
in those
and as an advisor and agent for Treasury's participation
Federal
Reserve
the
Bank
the
ESF,
operations. As fiscal agent for
of New York is legally obliged to execute foreign exchange
operations for the account of the ESF at the direction of Treasury.
Treasury does not have the legal authority to direct the
Federal Reserve System to undertake foreign exchange operations for
the System's account, nor does it have the authority to block
However, we are
operations which the System wishes to undertake.
confident that the lack of such authority does not constitute a
which rests
meaningful constraint on the executive responsibility
the
Treasury
for
decisions
with the President and the Secretary of
of the international financial policy of the
on and implementation

Close coordination on intervention questions is
evident in the normal practice of financing equal shares of total
division for the most part,
U. S. intervention;
any different
technical reasons such as the
instances,
rare
in
reflects, except
United

States.

respective availabilities

of different currencies.

Reports from this Committee accompanying legislation on U. S.
participation in the International Monetary Fund set forth the
financial
expectation of the Committee that the international
transactions of the Federal Reserve System will continue to be
fully consistent with the policies determined by the President and
the Secretary. In testimony, and in correspondence with Congress
and each other, Treasury and the Federal Reserve have confirmed
that foreign exchange operations of the Federal Reserve will be
consistent with the international financial policy of the United
States. The Treasury Department believes that this record and our
experience provide adequate assurances that the Federal Reserve's
operations will be fully coordinated with those of the Treasury.

Effectiveness

of Intervention

1988 Report to Congress on International
Economic and Exchange Rate Policy, we concluded that official
intervention in the currency market can have a positive effect on
foreign exchange market expectations, with important spillover
also
We
effects in domestic securities and money markets.
concluded that intervention had played a useful complementary role
in supporting the economic policy coordination efforts of major
nations.
We continue
to hold these views, which are consistent
with the views of policy makers in other countries.

In our

October

I wish to emphasize that intervention is only one element of
international financial policy and must be seen in the context
of our overall efforts to coordinate economic policies among the
major industrial countries. These efforts, which originated in the
so-called Plaza Agreement of September 1985 and led to the Louvre
Accord of February 1987, have been refined and institutionalized
since then through periodic meetings of the "G-7" Finance Ministers
and Central
Bank Governors.
in a very
They have contributed
important way to the improved performance of the U. S. economy
and of the world economy -- that we have witnessed in recent years,
and to the greater stability of exchange rates which was one of the
objectives of the Louvre Accord.

U. S.

It is

not possible to estimate with any degree of confidence
a
quantitative
relationship
between
intervention
the
and
performance
of real economic variables.
Indeed,
given the
complexity of financial markets, it is unlikely that a consistent
relationship exists. For instance, the sensitivity of the exchange
market to intervention
can vary considerably.
is
A key question
the degree to which market participants
believe that the
intervention is consistent with the trends of fundamental economic
variables such as growth, interest rates, inflation and the trade
balance, or signals the willingness of policy makers to change

policies that affect these variables.
I believe that the enhancement of economic policy coordination
major countries is an important factor in this assessment by

economic
among

Reports from this Committee accompanying legislation on U. S.
participation in the International Monetary Fund set forth the
financial
expectation of the Committee that the international
transactions of the Federal Reserve System will continue to be
fully consistent with the policies determined by the President and
the Secretary. In testimony, and in correspondence with Congress
and each other, Treasury and the Federal Reserve have confirmed
that foreign exchange operations of the Federal Reserve will be
consistent with the international financial policy of the United
States. The Treasury Department believes that this record and our
experience provide adequate assurances that the Federal Reserve's
operations will be fully coordinated with those of the Treasury.

Effectiveness

of Intervention

1988 Report to Congress on International
Economic and Exchange Rate Policy, we concluded that official
intervention in the currency market can have a positive effect on
foreign exchange market expectations, with important spillover
also
We
effects in domestic securities and money markets.
concluded that intervention had played a useful complementary role
in supporting the economic policy coordination efforts of major
nations.
We continue
to hold these views, which are consistent
with the views of policy makers in other countries.

In our

I

October

that intervention is only one element of
U. S. international
financial policy and must be seen in the context
of our overall efforts to coordinate economic policies among the
major industrial countries. These efforts, which originated in the
so-called Plaza Agreement of September 1985 and led to the Louvre
Accord of February 1987, have been refined and institutionalized
since then through periodic meetings of the "G-7" Finance Ministers
and

wish

to

Central

emphasize

Bank

Governors.

They

have

contributed

in a very

to the improved performance of the U. S. economy
and of the world economy -- that we have witnessed in recent years,
and to the greater stability of exchange rates which was one of the
objectives of the Louvre Accord.
It is not possible to estimate with any degree of confidence
a quantitative
relationship
between
the
intervention
and
performance
of real economic variables.
Indeed,
given the
complexity of financial markets, it is unlikely that a consistent
relationship exists. For instance, the sensitivity of the exchange
market to intervention
can vary considerably.
is
A key question
the degree to which market participants
believe that the
intervention is consistent with the trends of fundamental economic
variables such as growth, interest rates, inflation and the trade
balance, or signals the willingness of policy makers to change
economic policies that affect these variables.
I believe that the enhancement of economic policy coordination
among major countries is an important
factor in this assessment by
important

way

The perception that policy makers are now
participants.
likely to be employing intervention on the basis of jointly
determined
objectives has increased the potential
for our
intervention to have a useful impact. In turn, the agreement of
U. S. authorities
to intervene in cooperation with other major
nations has probably enabled those countries to be more responsive
to our recommendations on their policies.
Prior to the Plaza Agreement, the dollar had appreciated
and become seriously
sharply
misaligned,
important
rendering
sectors of U. S. industry uncompetitive in world markets and giving
rise to protectionist pressures and financial market instability.
At Plaza, the major countries agreed on new policy undertakings
consistent with balance of payments adjustment requirements,
including a gradual and substantial depreciation of the dollar to

market
more

improve

U. S. competitiveness.

relatively small amount of intervention sales of dollars
undertaken after this agreement encouraged the exchange market to
determine a value for the dollar that was far more reflective of
competitive
realities.
Since Plaza and Louvre, the major
industrial nations have sought to maintain exchange rates at levels
fundamentals.
more
consistent
with
economic
underlying
Intervention has played a role in this effort, and at times the
amount of intervention
has been substantial.
The process of greater coordination of economic policies has
over
success.
With economic growth averaging
had considerable
more
than
ten
million
between
1985
and
1989,
three percent a year
jobs have been added to the U. S. economy. A marked improvement in
net exports, a consequence of increased U. S. competitiveness, has
contributed importantly to this favorable trend and is a leading
source of strength of current economic activity. By mid-1990, the
trade deficit had declined roughly $60 billion from its 1987 peak— on average diminishing
Intervention
some 16-17 percent a year.
substantially
above
moved
had
sales of dollars when the dollar
levels reached in 1987 have helped to limit or prevent erosion of
this enhanced competitiveness.
lower than it
Furthermore, while the dollar is substantially
subdued,
has remained relatively
was in 1985, U. S. inflation
raise
to
tend
import
prices.
although lower exchange rates normally
This performance was aided by intervention purchases of dollars in
downward
the dollar was under substantial
when
circumstances
not
warranted
did
on
appear
depreciation
pressure but further
securities
S.
U.
markets
At times,
grounds.
competitiveness
exhibited considerable adverse effects from this downward pressure
In such circumstances, further depreciation might
on the dollar.
have resulted in higher prices and interest rates, and reduced
purchasing power and wealth of U. S. citizens, without a significant
compensating benefit.
The

The perception that policy makers are now
participants.
more likely to be employing intervention
on the basis of jointly
for our
determined
objectives has increased the potential
intervention to have a useful impact. In turn, the agreement of
to intervene in cooperation with other major
U. S. authorities
nations has probably enabled those countries to be more responsive
to our recommendations on their policies.
Prior to the Plaza Agreement, the dollar had appreciated
important
rendering
sharply and become seriously misaligned,
sectors of U. S. industry uncompetitive in world markets and giving
rise to protectionist pressures and financial market instability.
At Plaza, the major countries agreed on new policy undertakings
consistent with balance of payments adjustment requirements,
including a gradual and substantial depreciation of the dollar to

market

improve

U. S. competitiveness.

relatively small amount of intervention sales of dollars
undertaken after this agreement encouraged the exchange market to
determine a value for the dollar that was far more reflective of
realities.
Since Plaza and Louvre, the major
competitive
industrial nations have sought to maintain exchange rates at levels
fundamentals.
economic
consistent
with
more
underlying
Intervention has played a role in this effort, and at times the
has been substantial.
amount of intervention
The process of greater coordination of economic policies has
success.
With economic growth averaging over
had considerable
three percent a year between 1985 and 1989, more than ten million
jobs have been added to the U. S. economy. A marked improvement in
net exports, a consequence of increased U. S. competitiveness, has
contributed importantly to this favorable trend and is a leading
source of strength of current economic activity. By mid-1990, the
trade deficit had declined roughly $60 billion from its 1987 peak— on average diminishing
Intervention
some 16-17 percent a year.
sales of dollars when the dollar had moved substantially above
levels reached in 1987 have helped to limit or prevent erosion of
this enhanced competitiveness.
lower than it
Furthermore, while the dollar is substantially
relatively
subdued,
remained
has
was in 1985, U. S. inflation
although lower exchange rates normally tend to raise import prices.
This performance was aided by intervention purchases of dollars in
downward
the dollar was under substantial
when
circumstances
warranted
on
pressure but further depreciation did not appear
markets
U. S. securities
At times,
grounds.
competitiveness
exhibited considerable adverse effects from this downward pressure
In such circumstances, further depreciation might.
on the dollar.
have resulted in higher prices and interest rates, and reduced
purchasing power and wealth of U. S. citizens, without a significant
compensating benefit.
The

not be
that, at times, intervention
may
successful, for instance because unusual market forces
are operating.
This was the case earlier this year when Japan's
substantial financial market adjustment placed unusually strong and
sustained pressure on the yen. At that time the yen continued to
decline despite heavy intervention and despite the fundamental
soundness of Japan's economy, although it is of course not possible
to know how much further the yen might have declined without that
intervention.

recognize

We

demonstrably

We
also recognize that the impact of intervention
can
dissipate over time and that in the long run only more fundamental
policies and performance matter.
But there can be significant
dislocations in the short run as a result of excessive fluctuation
of exchange rates: firms can go bankrupt, individuals can lose
their jobs and be unemployed for a few months before finding
another, and trade and investment decisions can be deferred or
distorted.
Thus, failure to intervene may impose significant
economic costs in some situations.
For example, in some instances
the failure of official institutions
of the major industrial
countries to intervene in exchange markets has been interpreted by
market participants,
the financial media, and even members of
Congress,
as signalling
a breakdown
in the economic policy
coordination process. It is our firm belief that foreign exchange
market intervention,
by fostering greater stability
in exchange
rates and reinforcing the broader objectives of the G-7 economic
policy coordination process, can make an important contribution to
improving our welfare at home.
Sterilization of Intervention

Intervention

sterilized.
impact

undertaken

by

U. S.

authorities

is invariably

That is, the Federal Reserve routinely offsets the
on banks' reserves of U. S. purchases or sales of foreign

currency.

Our decisions
on intervention
are taken on the
that it will be sterilized, and we do not believe that
its effectiveness as a policy instrument is compromised as a
result.
If changes in bank reserves are desired, other policy
tools are available.

presumption

Ma

nitude

of U. S. Forei

n

Currenc

Holdin

s

Appended to my testimony is a table setting forth the growth
of the foreign currency holdings of the ESF and the Federal Reserve
since l975. That growth was particularly large in 1989 and this
year.
It largely reflects the intervention sales of dollars
undertaken
to resist the upward pressure on the dollar in the
exchange market, in accordance with policies agreed with other
major nations at times when the dollar had appreciated to a degree
which appeared to threaten
continued
in reducing our
deficits on trade and current account. progress

not be
may
that, at times, intervention
market
forces
unusual
because
instance
for
demonstrably successful,
This was the case earlier this year when Japan's
are operating.
substantial financial market adjustment placed unusually strong and
sustained pressure on the yen. At that time the yen continued to
and despite the fundamental
decline despite heavy intervention
Japan's
it is of course not possible
of
although
soundness
economy,
to know how much further the yen might have declined without that
We

recognize

intervention.

can
We
also recognize that the impact of intervention
dissipate over time and that in the long run only more fundamental
But there can be significant
policies and performance matter.
dislocations in the short run as a result of excessive fluctuation
of exchange rates: firms can go bankrupt, individuals can lose
their jobs and be unemployed for a few months before finding
another, and trade and investment decisions can be deferred or
distorted.
Thus, failure to intervene may impose significant
economic costs in some situations.
For example, in some instances
the failure of official institutions
of the major industrial
countries to intervene in exchange markets has been interpreted by
market participants,
the financial media, and even members of
as signalling
Congress,
a breakdown
in the economic policy
coordination process. It is our firm belief that foreign exchange
market intervention,
in exchange
by fostering greater stability
rates and reinforcing the broader objectives of the G-7 economic
policy coordination process, can make an important contribution to
improving our welfare at home.
Sterilization of Intervention

undertaken
is invariably
by U. S. authorities
That is, the Federal Reserve routinely offsets the
impact on banks' reserves of U. S. purchases or sales of foreign
currency.
Our decisions
on intervention
are taken on the
presumption that it will be sterilized, and we do not believe that
its effectiveness as a policy instrument is compromised as a
result.
If changes in bank reserves are desired, other policy

Intervention

sterilized.

tools are available.
Ma nitude
of U. S. Forei n Currenc Holdin s
Appended to my testimony is a table setting forth the growth
of the foreign currency holdings of the ESF and the Federal Reserve
since 1975. That growth was particularly large in 1989 and this
year.
It largely reflects the intervention sales of dollars
undertaken
to resist the upward pressure on the dollar in the
exchange market, in accordance with policies agreed with other
major nations at times when the dollar had appreciated to a degree
which appeared to threaten
continued progress in reducing our

deficits

on

trade

and

current account.

While these holdings are large compared to U. S. holdings
in earlier years, they are relatively small when compared to the
foreign exchange holdings of other major countries and to the size
of the U. S. economy. Several other G-7 countries hold more foreign
exchange in absolute terms than we do, and some non-G-7 countries
do as well.

scalar of

--

number of
of imports covered by reserve holdings -- the United States'
foreign exchange holdings are equal to one month's worth of
countries and most developing
imports, while other industrialized
countries hold over two months' worth. Moreover, the proportion of
total reserves (which also include gold, reserve position in the
IMF and SDR holdings)
represented by foreign currency holdings is
considerably smaller in the case of the United States than for
other countries.
Risks in Holdin Forei n Currencies
The dollar value of U. S. foreign currency holdings increases
when the dollar depreciates against the foreign currencies held and
decreases when the dollar appreciates against them. It is normal
that there will be periods of valuation losses as well as periods
of valuation gains, just as it is normal that the dollar fluctuates
over time. As our purchases of foreign currencies have on balance
been made at relatively high levels of the dollar and our sales at
relatively low levels, we have made substantial profits.
valuation losses is
We believe that the risk of substantial
compensated
than
and
is
more
relatively small,
by the potential
currencies
to cushion the
benefits of being able to use our foreign
domestic economy from the possible adverse effects of a sharp
depreciation of the dollar. Also, there is no reason to believe
that further gains are less likely than losses, and if losses do
occur they are likely to be relatively small and offset only partly
the significant gains made in recent years.
As the U. S. budget results are calculated on a cash basis,
valuation gains and losses on the ESF's foreign currency holdings
affect the budget deficit only when they are "realized" as a result
the Federal Reserve
However,
of sale of foreign currencies.
includes unrealized as well as realized gains in the calculation of
overall profits on its operations, which profits are then largely
paid to the Treasury and reflected in the budget as a miscellaneous
receipt. Also affecting the budget are (a) interest received on
the foreign currency holdings (and on other assets held by the
ESF), and (b) as an exception to the cash basis of other
transactions, valuation gains or losses on the ESF's net holdings
of SDRs. In the case of the ESF, gains are reflected in the budget
as negative outlays.
By one

months

common

adequacy

of reserves

While these holdings are large compared to U. S. holdings
earlier
in
years, they are relatively small when compared to the
foreign exchange holdings of other major countries and to the size
of the U. S. economy. Several other G-7 countries hold more foreign

in absolute terms than
do as well.
exchange

we

do, and some non-G-7 countries

By one common scalar of adequacy of
months of imports covered by reserve holdings

reserves -- number of
-- the United States'

foreign exchange holdings are equal to one month's worth of
imports, while other industrialized
countries and most developing
countries hold over two months' worth. Moreover, the proportion of
total reserves (which also include gold, reserve position in the
IMF and SDR holdings)
represented by foreign currency holdings is
considerably smaller in the case of the United States than for
other countries.
Risks in Holdin

Forei

n

Currencies

The dollar value of U. S. foreign currency holdings increases
the dollar depreciates against the foreign currencies held and
decreases when the dollar appreciates against them. It is normal
that there will be periods of valuation losses as well as periods
of valuation gains, just as it is normal that the dollar fluctuates
over time. As our purchases of foreign currencies have on balance
been made at relatively high levels of the dollar and our sales at
relatively low levels, we have made substantial profits.

when

valuation losses is
We believe that the risk of substantial
relatively small, and is more than compensated by the potential
benefits of being able to use our foreign currencies to cushion the
domestic economy from the possible adverse effects of a sharp
depreciation of the dollar. Also, there is no reason to believe
that further gains are less likely than losses, and if losses do
occur they are likely to be relatively small and offset only partly
the significant gains made in recent years.
As the U. S. budget results are calculated on a cash basis,
valuation gains and losses on the ESF's foreign currency holdings
affect the budget deficit only when they are "realized" as a result
the Federal Reserve
However,
of sale of foreign currencies.
includes unrealized as well as realized gains in the calculation of
overall profits on its operations, which profits are then largely
paid to the Treasury and reflected in the budget as a miscellaneous
receipt. Also affecting the budget are (a) interest received on
the foreign currency holdings (and on other assets held by the
ESF), and (b) as an exception to the cash basis of other
transactions, valuation gains or losses on the ESF's net holdings
of SDRs. In the case of the ESF, gains are reflected in the budget.
as negative outlays.

10

ESF's operations in recent years have made considerable
The contribution
contributions to reducing the budget deficit.
exceeded $1 billion in each of the previous three fiscal years.
The

Activities
During consideration of the 1934 legislation creating the ESF
and again during debate on its extension in 1939, the Congress
decided that the effectiveness of the ESF would be undercut unless
the Secretary of the Treasury had total control over its operations
and that his decisions could not be reviewed by any other officer
in 1939 that the
A suggestion
of the United States Government.
General Accounting Office conduct the annual audit of the Fund was
rejected on the ground that giving outside auditors access to
detailed analyses of its operations would compromise the need for
confidentiality.
in 1970 to audit the
Although the GAO was given authority
administrative expenses of the ESF, this authority was limited to
determining that such expenses were properly accounted for and that
had been
and
systems
procedures
accounting
fully adequate
established.
The provisions of the amendment of Section 5302 and
the legislative history of the amendment made clear that the audit
provisions were not intended to derogate from the broad and
absolute discretion of the Secretary in managing the ESF, and that
to monitor the monetary and
GAO was not to be given the authority
In 1978, as part of the
financial operations of the ESF.
amendments
to an earlier version of Section 5302 which terminated
expenses from the
the Secretary's authority to pay administrative
GAO's
administrative
expenses of the
audit authority over
ESF, the

Auditin

ESF was

of ESF Statements

and

repealed.

Audits of the ESF's accounts are carried out by offices within
of the offices responsible for
Treasury that are independent
implementing
foreign exchange operations. Following establishment
in 1978 of the position of Inspector General of the Treasury,

for audits of ESF operations was transferred to his
office. Conclusions of each ESF audit are provided as part of the
Annual Report on the ESF, which is transmitted
to Congress as well
as to the President.
To our knowledge,
there has never been an
audit of the ESF's financial statements by a public accounting
firm, and we would oppose any such audit.
The rationale for maintaining confidentiality
with respect to
the operations of the ESF, recognized over 50 years ago and in
subsequent amendments to its authorizing legislation, remains valid
Those operations
today.
for the most part either entail
transactions with foreign monetary authorities or could tend to
reveal those authorities'
own operations.
Foreign authorities
provide sensitive factual and analytical information on their own
operations to U. S. authorities in the expectation that it will be
held in strict confidence, on a "need-to-know" basis, and they
responsibility

10

ESF's operations in recent years have made considerable
The contribution
contributions to reducing the budget deficit.
fiscal years.
three
exceeded $1 billion in each of the previous
The

Activities
During consideration of the 1934 legislation creating the ESF
and again during debate on its extension in 1939, the Congress
decided that the effectiveness of the ESF would be undercut unless
the Secretary of the Treasury had total control over its operations
and that his decisions could not be reviewed by any other officer
in 1939 that the
A suggestion
of the United States Government.
General Accounting Office conduct the annual audit of the Fund was
rejected on the ground that giving outside auditors access to
detailed analyses of its operations would compromise the need for
confidentiality.
in 1970 to audit the
Although the GAO was given authority
administrative expenses of the ESF, this authority was limited to
determining that such expenses were properly accounted for and that
had been
and
fully adequate
accounting
procedures
systems
established.
The provisions of the amendment of Section 5302 and
the legislative history of the amendment made clear that the audit
provisions were not intended to derogate from the broad and
absolute discretion of the Secretary in managing the ESF, and that
GAO was not to be given the authority
to monitor the monetary and
financial operations of the ESF.
In 1978, as part of the
amendments
to an earlier version of Section 5302 which terminated
the Secretary's authority to pay administrative
expenses from the
GAO's
ESF, the
audit authority over administrative expenses of the

Auditin

ESF was

of ESF Statements

and

repealed.

Audits of the ESF's accounts are carried out by offices within
Treasury that are independent
of the offices responsible for
implementing
foreign exchange operations. Following establishment
in 1978 of the position of Inspector General of the Treasury,

responsibility

office.

for audits of

ESF operations

was

transferred

to his

Conclusions of each ESF audit are provided as part of the
Annual Report on the ESF, which is transmitted
to Congress as well
as to the President.
To our knowledge,
there has never been an
audit of the ESF's financial statements by a public accounting
firm, and we would oppose any such audit.

rationale for maintaining confidentiality with respect to
of the ESF, recognized over 50 years ago and in
subsequent amendments to its authorizing legislation, remains valid
today.
Those operations
for the most part either entail
transactions with foreign monetary authorities or could tend to
reveal those authorities
own operations.
Foreign authorities
provide sensitive factual and analytical information on their own
operations to U. S. authorities in the expectation that it will be
held in strict confidence, on a "need-to-know" basis, and they
The

the operations

11
might be expected

to withhold at least

they could not expect such standards

some

of that information

to be maintained.

if

U. S. monetary
authorities
substantial
do provide
information on their foreign exchange operations, considerably more
than is provided by most
not all other countries.
Publicly
The

if

information
includes the report prepared every three
months by the Federal Reserve Bank of New York on Treasury and
Federal Reserve Foreign Exchange Operations and the Annual Report
of the ESF. Also, we provide to this Committee and its counterpart
in the Senate, on a confidential basis, monthly reports on U. S.
intervention activity and the monthly financial statements of the
ESF. We have not received any indication that the Congress finds
this information insufficient.
Nevertheless, we will endeavor to
for
manner to any specific requests
respond in an appropriate
further information,
subject to the need to protect sensitive

available

details.

International

Debt

Strate

The debt difficulties of developing countries remain a serious
global problem which requires cooperative efforts on the part of
all parties. The United States has a major stake in the success of
these efforts.
If left unattended, the debt problems faced by
of the
countries could jeopardize the stability
developing
trend
toward
the
interrupt
financial
international
system,
expanding trade flows, and reduce the path of world growth.

proposed by Secretary Brady in the spring of 1989
to strengthen the debt strategy is intended to mobilize more
effective external financial support for debtor countries' efforts
to reform their economies and achieve lasting growth. Our ideas
built on suggestions of many throughout the world, including
strategy revolves around two
The strengthened
members of Congress.
central themes: the need to give greater emphasis to debt and debt
The approach

service reduction,

and

the need for debtor countries

to

implement
and flight

sound economic policies designed to encourage
capital repatriation.
The IMF and World Bank will continue to provide new loans to
provide support for strong economic reform programs in debtor
U. S financial support for developing countries can be
nations.
As part of the
leveraged several-fold through these institutions.
however, the U. S. proposed that a portion of these
new approach,
loans be redirected to support debt and debt service reduction by
are also providing limited
The institutions
commercial banks.
Both this committee and
interest support for these transactions.
World Bank funds
of
use
to
encouraged
whole
Congress as a
the
GCI
of
appropriations
facilitate debt reduction as part
legislation in 1988.

investment

11

to withhold at least some of that information
could
not
expect such standards to be maintained.
they

might be expected

if

U. S. monetary
authorities
substantial
The
do provide
information on their foreign exchange operations, considerably more
than is provided by most if not all other countries.
Publicly
available information includes the report prepared every three
months by the Federal Reserve Bank of New York on Treasury and
Federal Reserve Foreign Exchange Operations and the Annual Report
of the ESF. Also, we provide to this Committee and its counterpart
in the Senate, on a confidential basis, monthly reports on U. S.
intervention activity and the monthly financial statements of the
ESF. We have not received any indication that the Congress finds
this information insufficient.
Nevertheless, we will endeavor to
for
manner to any specific requests
respond in an appropriate
further information,
subject to the need to protect sensitive

details.

International

difficulties of

Debt

Strate

countries remain a serious
global problem which requires cooperative efforts on the part of
all parties. The United States has a major stake in the success of
these efforts.
If left unattended, the debt problems faced by
of the
countries could jeopardize the stability
developing
the trend toward
interrupt
financial
international
system,
expanding trade flows, and reduce the path of world growth.
The debt

developing

The approach proposed by Secretary Brady in the spring of 1989
to strengthen the debt strategy is intended to mobilize more
effective external financial support for debtor countries' efforts
to reform their economies and achieve lasting growth. Our ideas
built on suggestions of many throughout the world, including
strategy revolves around two
The strengthened
members of Congress.
central themes: the need to give greater emphasis to debt and debt
service reduction, and the need for debtor countries to implement
sound economic policies designed to encourage investment and flight
capital repatriation.
The IMF and World Bank will continue to provide new loans to
provide support for strong economic reform programs in debtor
nations.
U. S financial support for developing countries can be
As part of the
several-fold
through these institutions.
leveraged
that
a
portion
of these
however, the U. S. proposed
new approach,
loans be redirected to support debt and debt service reduction by
are also providing limited
The institutions
commercial banks.
Both this committee and.
interest support for these transactions.
use of World Bank funds to
Congress as a whole encouraged
of the GCI appropriations
as
part
reduction
debt
facilitate
legislation in 1988.

12

1989, the IMF and World Bank Executive Boards agreed on
broad guidelines of support for debt and debt service reduction
operations for those countries which have adopted strong adjustment
Legal authority
programs and have a clear need for debt reduction.
for this action is encompassed within Article V, Section 3(a) of
the IMF's Articles of Agreement and Article III, Section 4(vii) of
are
such operations
As a safeguard,
the World Bank Charter.
subject to detailed, objective criteria developed and approved by
the Executive Boards of both institutions.
have helped to encourage the
IMF and World Bank support
and debt service reduction
debt
successful conclusion of several
Six countries
debtor countries.
with individual
agreements
and
Costa Rica, Chile, Venezuela,
(Mexico, the Philippines,
banks.
These
commercial
with
the
Morocco) have reached agreements
countries account for 46 percent of the total commercial bank debt
of the major debtors.
In

May

The watershed
agreement between Mexico and its commercial
banks was formally completed in February 1990. Chile's buyback of
commercial bank debt in November 1989 was financed by resources
made available under the strengthened
debt strategy.
In February
of this year, the Philippines completed its new financing package
with commercial banks, which included a highly successful direct
buyback of commercial bank debt. Costa Rica and its creditors have
reached an agreement in principle on a comprehensive debt and debt
service reduction package. In March, Venezuela and its creditor
banks announced an agreement in principle on a financing package
which includes a broad range of options for debt and debt service
reduction.
Banks are in the process of selecting options under
this package and are expected to complete the agreement by the

fourth quarter

of 1990.

strategy also envisaged the use of zeroto back debt and debt service reduction
transactions.
Mexico purchased zero-coupon bonds from several
sources including the United States.
The strengthened debt
coupon bonds as collateral

By statute, the Congress has delegated
on the credit of the United States

the authority to borrow
to the Secretary of the
Treasury (with the approval of the President).
The Secretary has
been given broad authority to issue bonds of the Government for the
amounts
borrowed and to prescribe the conditions
under which
obligations may be used, including the form of the obligation and
the interest rate to be paid. This authority extends to marketable
as well as non-marketable securities, such as the zero-coupon bond
issued to Mexico.
In this case, Mexico purchased zero-coupon
securities and the Treasury borrowing rate on this transaction was
on terms and conditions
which the Secretary determined
to be

money

appropriate.

12

In May 1989, the IMF and World Bank Executive Boards agreed on
broad guidelines of support for debt and debt service reduction
operations for those countries which have adopted strong adjustment
Legal authority
programs and have a clear need for debt reduction.
for this action is encompassed within Article V, Section 3(a) of
the IMF's Articles of Agreement and Article III, Section 4(vii) of
such operations are
As a safeguard,
the World Bank Charter.
subject to detailed, objective criteria developed and approved by
the Executive Boards of both institutions.
IMF

successful

and

World

conclusion

Bank

support

of several

helped to encourage the
debt and debt service reduction
have

Six countries
debtor countries.
with individual
agreements
Venezuela,
and
Costa
Chile,
Rica,
the
Philippines,
(Mexico,
banks.
These
Morocco) have reached agreements with the commercial
countries account for 46 percent of the total commercial bank debt
of the major debtors.

The watershed
agreement between Mexico and its commercial
banks was formally completed in February 1990. Chile's buyback of
commercial bank debt in November 1989 was financed by resources
In February
made available under the strengthened
debt strategy.
of this year, the Philippines completed its new financing package
with commercial banks, which included a highly successful direct
buyback of commercial bank debt. Costa Rica and its creditors have
reached an agreement in principle on a comprehensive debt and debt
service reduction package. In March, Venezuela and its creditor
banks announced an agreement in principle on a financing package
which includes a broad range of options for debt and debt service
reduction.
Banks are in the process of selecting options under
this package and are expected to complete the agreement by the

fourth quarter

of 1990.

The strengthened debt strategy also envisaged the use of zerocoupon bonds as collateral to back debt and debt service reduction
transactions.
Mexico purchased zero-coupon bonds from several

sources including

the United States.

By statute, the Congress has delegated
on the credit of the United States

the authority to borrow
to the Secretary of the
Treasury (with the approval of the President).
The Secretary has
been given broad authority to issue bonds of the Government for the
amounts
borrowed and to prescribe the conditions
under which
obligations may be used, including the form of the obligation and
the interest rate to be paid. This authority extends to marketable
as well as non-marketable securities, such as the zero-coupon bond
issued to Mexico.
In this case, Mexico purchased zero-coupon
securities and the Treasury borrowing rate on this transaction was
on terms and conditions
which the Secretary determined
to be
appropriate.

money

13

pricing decision for the zero-coupon bond for
factors which included the size of the Mexican
transaction and the precedent of the 1987-88 Mexican purchase of
zeros. The earlier Mexican deal was priced off the coupon rate
because the STRIPS market was deemed to lack sufficient depth and
the size of the transaction was large relative to the outstanding
STRIPS market.
The 1990 Mexican transaction size of $30. 2 billion
was even larger relative
to the STRIPS market.
The specific
pricing formula for the 1990 Mexican transaction involved the
average 30-year U. S. Treasury coupon borrowing rate for the 3-day
period ending January 5, 1990, plus a fee. The other countries
which sold Mexico zero-coupon bonds also followed a similar pricing
The Treasury

Mexico was based on

formula.

the strengthened
debt strategy, we contemplate that
other heavily-indebted
countries may purchase zero-coupon bonds
from the Department
of the Treasury on a case-by-case basis in
order to collateralize debt and debt service reduction instruments.
Collateralization of new debt instruments has not been an element
of all the agreements reached to date. While Mexico made use of
this option and Venezuela is likely to do so, agreements reached by
the Philippines, Costa Rica and Chile focused on cash buybacks of
commercial bank loans and therefore did not envisage the use of
zero-coupon bonds.
We cannot predict the actual demand
for such
bonds, since that will be driven by the timing of bank agreements,
the options available in those agreements, and bank interest in
collateralized instruments.
Under

mechanisms to redress difficulties in servicing existing
debt agreements and further market-oriented structural reforms can
make an important difference in addressing the international
debt
New

problem.

reduction within the debt strategy has
of debtor
on the part of a number
reforms.
needed
Commercial
countries in undertaking difficult but
banks are actively engaged in debt and debt service reduction to
Public resources to support
ease the burdens on debtor nations.
and efficient basis.
limited
this process are being provided on a
While much remains to be done, we are confident that we have a
strategy with the flexibility needed to meet the challenge facing
The emphasis on debt
renewed vigor

encouraged

us

~

13

pricing decision for the zero-coupon bond for
Mexico was based on factors which included the size of the Mexican
transaction and the precedent of the 1987-88 Mexican purchase of
zeros. The earlier Mexican deal was priced off the coupon rate
because the STRIPS market was deemed to lack sufficient depth and
the size of the transaction was large relative to the outstanding
STRIPS market.
The 1990 Mexican transaction size of $30. 2 billion
was even larger relative
to the STRIPS market.
The specific
pricing formula for the 1990 Mexican transaction involved the
average 30-year U. S. Treasury coupon borrowing rate for the 3-day
period ending January 5, 1990, plus a fee. The other countries
which sold Mexico zero-coupon bonds also followed a similar pricing
The Treasury

formula.

Under the strengthened
debt strategy, we contemplate that
other heavily-indebted
countries may purchase zero-coupon bonds
from the Department
of the Treasury on a case-by-case basis in
order to collateralize debt and debt service reduction instruments.
Collateralization of new debt instruments has not been an element
of all the agreements reached to date. While Mexico made use of
this option and Venezuela is likely to do so, agreements reached by
the Philippines, Costa Rica and Chile focused on cash buybacks of
commercial bank loans and therefore did not envisage the use of
for such
zero-coupon bonds.
We cannot predict the actual demand
bonds, since that will be driven by the timing of bank agreements,
the options available in those agreements, and bank interest in
collateralized instruments.
New

mechanisms

to redress difficulties

debt agreements and further market-oriented
make an important difference in addressing
problem.

in servicing existing
structural reforms can
the international debt

the debt strategy has
part of a number of debtor
countries in undertaking difficult but needed reforms. Commercial
banks are actively engaged in debt and debt service reduction to
Public resources to support
ease the burdens on debtor nations.
this process are being provided on a limited and efficient basis.
While much remains to be done, we are confident that we have a
strategy with the flexibility needed to meet the challenge facing
The emphasis on debt reduction
renewed vigor on the
encouraged

us.

within

14
Appendix

Balances of Exchange Stabilization
3 1,

as of December

A

Fund

1989

billions of dollars"
Assets
U. S.

1.9

dollars:

(of which: deposit with Treasury:
Special Drawing Rights

$1.1 billion~
10.0
13.2

Foreign exchange and securities
(of which: German marks: $5. 5 billion~)
Japanese yen: $7. 2 billion)
(
Accounts

0. 3

receivable

25. 4

TOTAL

Liabilities

and Ca

ital

Advance

from Treasury4

Special

Drawing

Rights

Special

Drawing

Rights allocations

Accounts payable

8. 5
6. 4
0. 1

Capital

9. 3

certificates

25. 4

TOTAL

'non-dollar

balances valued at end-of-period

exchange

rate

~non-interest bearing deposit with Treasury General
reflecting proceeds of Advance from Treasury (see below)
excludes marks warehoused
a non-interest

resulting
from the

bearing

from the transfer
IMF by the United

Fund,

with Federal Reserve

liability

to the
States

ESF

to Treasury General
of foreign currencies

Fund
drawn

14
Appendix

Balances of Exchange Stabilization

A

Fund

as of December 31, 1989

billions of dollars'
Assets
U. S.

1.9

dollars:

(of which: deposit with Treasury:
Special Drawing Rights

$1.1 billion
10.0
13.2

Foreign exchange and securities
(of which: German marks: $5. 5 billion~)
Japanese yen: $7. 2 billion)
(
Accounts

0. 3

receivable

25. 4

TOTAL

Liabilities

and Ca

ital

Advance

from Treasury

Special

Drawing

Rights

Special

Drawing

Rights allocations

Accounts payable

8. 5
6. 4
0. 1

Capital

9.3

certificates

25. 4

TOTAL

'non-dollar

balances valued at end-of-period

exchange

rate

~non-interest bearing deposit with Treasury General
reflecting proceeds of Advance from Treasury (see below)
~

excludes marks warehoused
a non-interest

resulting
from the

bearing

from the transfer
IMF by the United

Fund,

with Federal Reserve

liability

to the
States

ESF

to Treasury General
of foreign currencies

Fund
drawn

15
Appendix

Foreign Currency Holdings

of the Treasury

and

in millions
End

of Period

1978
1979
1980
1981
1982
1983
1984
1985
1986
March

June

2, 766

1, 343

Total

1, 608

4, 374

2, 464
4, 894
5, 108
5, 741

8, 339
6, 368
6, 088
5, 353

8, 953
7, 534
7, 911
7, 735

1988

4, 878
4, 675
8, 493
8, 205

6, 701
6, 118
9, 522

Dec

March 1989

June

Sept
Dec

June

Federal
Reserve

1987

Sept

March

of dollars

3, 578
7, 110
9, 563

Dec

June

Federal Reserve

5, 240
4, 666
4, 471
2, 556
3, 078
5, 746
7, 765

Sept

March

Treasu

1990

B

3 / 733

9, 158
11,726
19, 337

3, 807
10, 134
9, 774
10, 212
6, 289
6, 656
12, 856
17, 328
17, 292
13, 902
13, 999
13, 088

11,579

10, 793
18, 015
17, 363

8, 572
12, 180
12, 661
13, 220

26, 419
31/331

44, 551

11,908

34, 516

46, 424
47, 294

20, 298

31, 517
39, 080

NOTES

1.

Warehoused
currencies are included in Federal
and excluded from Treasury's holdings.

holdings

Reserve's

2. Dollar equivalents were obtained by converting total holdings
for each foreign currency in dollars using current New York noon
buying rates, except for currencies held under swap agreements with
other countries, which are valued at historical costs. Note,
entry in this table for Federal Reserve holdings differs from the
entry in Table 1.18 in the Federal Reserve Bulletin line item
"Denominated
in Foreign Currencies", which uses as the current
exchange rate the 10 A. M. buying rate two days before the end of
the month and values warehoused currencies at historical costs.

15
Appendix

Foreign Currency Holdings

of the Treasury

and

in millions
End

of Period

1978
1979
1980

2, 766

1, 343

5, 240
4, 666
4, 471

1981

June

2, 464
4, 894

4, 374
3, 807
10, 134

8, 339
6, 368
6, 088
5, 353

8, 953
7, 534
7, 911
7, 735

17, 292
13, 902
13, 999
13, 088

1988

4, 878
4, 675
8, 493
8, 205

6, 701
6, 118

11,579

Dec

March 1989

June

Sept
Dec

June

1, 608

Total

1987

Sept

March

Federal
Reserve

9, 563

Dec

June

of dollars

3, 078
5, 746
7, 765

2, 556

Sept

March

Federal Reserve

9, 774
10, 212
6, 289
6, 656
12, 856
17, 328

1982
1983
1984
1985
1986

March

Treasu

1990

B

5, 108
5, 741
3 / 733

3, 578
7, 110

9, 522
9, 158
11,726
19, 337

10, 793
18, 015
17, 363

8, 572
12, 180
12, 661
13, 220

26, 419
31/331

44, 551

11,908

34, 516

46, 424
47, 294

20, 298

31, 517
39, 080

NOTES

1.

Warehoused
currencies are included in Federal
and excluded from Treasury's holdings.

holdings

Reserve's

2. Dollar equivalents were obtained by converting total holdings
for each foreign currency in dollars using current New York noon
buying rates, except for currencies held under swap agreements with
other countries, which are valued at historical costs. Note, the
entry in this table for Federal Reserve holdings differs from the
entry in Table 1.18 in the Federal Reserve Bulletin line item
"Denominated
in Foreign Currencies", which uses as the current
exchange rate the 10 A. M. buying rate two days before the end pf
the month and values warehoused currencies at historical costs.

apartment of the TreasurV ~ ppphlnyfon,

D.C. ~ Telephone 566-264

I

CONTACT:

4:00
14, 1990

FOR RELEASE AT

August

OFFICE OF FINANCING

202/376-4350

P

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
tenders for two series of Treasury bills totaling approximately
This offering
$ 18, 400 million, to be issued August 23, 1990.
will provide about $2, 275 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of $16, 122 million.
Tenders will be received at Federal Reserve Banks and Branches and at
the Bureau of the Public Debt, Washington, D. C. 20239, prior to 1:00
p. m. , Eastern Daylight Saving time, Monday, August 20, 1990.
The two series offered are as follows:

bills (to maturity date) for approximately $9, 200
representing an additional amount of bills dated
November 23, 1990 (CUSIP No.
November 24, 1989, and to mature
912794 US 1), currently outstanding in the amount of S 18, 227 million,
the additional and original bills to be freely interchangeable.
92-day

million,

182-day
August

912794

bills for

23, 1990,

VW

1)-

and

approximately $9, 200 million, to be dated
to mature February 21, 1991 (CUSIP No.

The bills will be issued on a discount
and noncompetitive
bidding, and at maturity

basis under competitivg
their par amount will
of
bills will be issued
series
Both
be payable without interest.
entirely in book-entry form in a minimum amount of S10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
or of the Department of the Treasury
Branches,
Reserve Banks and
be issued for cash and in exchange for Treasury
Tenders from Federal Reserve
August 23. 1990.
for foreign and interand
as
agents
Banks for their own account
national monetary authorities will be accepted at the weighted
Addiaverage bank discount rates of accepted competitive tenders.
tional amounts of the bills may be issued to Federal Reserve Banks,
monetary authorities,
to
as agents for foreign and international

bills

The

bills will

maturing

the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
Reserve Banks currently hold S 596 million as agents for foreign
and S 4, 756 million for their
monetary authorities,
and international
Tenders for bills to be maintained on the book-entry
own account.
Department of the Treasury should be submitted on Form
the
of
records
PD 5176-1 ( for 13-week series) or Form PD 5176-2 ( for 26-week series ) .
NB-921

epartment of tile Treasory

~ W~pshlnpfon,

D.C. ~ 7elepllone 566-204'I

I

CONTACT:
FOR RELEASE AT 4

14, 1990

August

00

P M.

,

l

OFFICE OF FINANCING

202/376-4350

GFTII

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
for two series of Treasury bills totaling approximately
$18, 400 million, to be issued August 23. 1990.
This offering
will provide about S2, 275 million of new cash for the Treasury, as

tenders

the maturing bills are outstanding in the amount of $16. 122 million.
Tenders will be received at Federal Reserve Banks and Branches and at
the Bureau of the Public Debt, Washington, D. C. 20239, prior to 1:00
p. m. , Eastern Daylight Saving time, Monday, August 20, 1990.
The two series offered are as follows:

bills (to maturity date) for approximately S9, 200
representing an additional amount of bills dated
November 24, 1989, and to mature
November 23, 1990 (CUSIP No.
912794 US 1). currently outstanding in the amount of $ 18. 227 million,
the additional and original bills to be freely interchangeable.
92-day

million,

182-day
August

912794

vW

1).

and

approximately

to mature

$9, 200 million, to be dated
February 21, 1991 (CUSIP No.

bills will

be issued on a discount

bills will

be issued

basis under competitivg
and noncompetitive
bidding, and at maturity their par amount will
Both series of bills will be issued
be payable without interest.
entirely in book-entry form in a minimum amount of $10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury.
The

~

bills for

23, 1990,

for cash and in exchange for Treasury
Tenders from Federal Reserve
bills maturing August 23, 1990.
Banks for their own account and as agents for foreign and international monetary authorities will be accepted at the weighted
Addiaverage bank discount rates of accepted competitive tenders.
Federal
Reserve
to
issued
Banks,
tional amounts of the bills may be
monetary authorities,
to
as agents for foreign and international
the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
Reserve Banks currently hold S 596 million as agents for foreign
and S 4, 756 million for their
monetary authorities,
and international
Tenders for bills to be maintained on the book-entry
own account.
records of the Department of the Treasury should be submitted on Form
PD 5176-1 (for 13-week series) or Form PD 5176-2 (for 26-week series).
The

NB-921

~~~SURY&S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury's single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of

tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury s single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose. of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TEQASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.

Treasury

Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
funds
on the issue date, in cash or other immediately-available
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.
If a bill is

is

held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
purchased

at issue,

and

of the Treasury Circulars, Public Debt Series
Nos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

TRI'USURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement for accepted tenders for bills to be maintained
on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.
If a bill is

purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
Department of the Treasury Circulars, Public Debt Series
Nos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of

the Public Debt.
8/89

LJMLV
Department

of the Treasury

~

~

s e
0~

Bureau of the Public Debt

FOR IMMEDIATE RELEASE
August 15, 1990

„;.

,

„. ij,
:

g

~

Washington,

DC 20239

~C$)~ACT; Office of Financing
202/376-4350

TREASURP ANNOUNCES NE% SUBMISSION DEADLINE
FOR NONCOMPETITTVE TENDERS IN MARKETABLE SECURITY AUCTIONS
TO RELEASE AUCTION RESULTS EARLIER

Me Treasury

announced today that it set a new 12:00 noon Eastern time deadline for
the submission of noncompetitive tenders for its securities auctions. The change will be
effective with the 13- and 26-week Treasury bill auctions tentatively scheduled for
November 5, 1990. The deadline for submissions of competitive tenders will remain at
1:00 p, m. , Eastern time. Currently, all tenders, both competitive and noncompetitive,
are required to be submitted by 1:00 p.m. , on auction day.

The noncompetitive submission deadline is being changed to permit auction results to
be released to the financial markets more quick1y. The new deadline for noncompetitive
tenders, in addition to increased automation of Treasury's process for determining the
auction results, should permit Treasury to meet its goal of regularly releasinp auction
results by approximately 2:00 p.m. , Eastern time. Earlier release of auction results is
expected to facilitate secondary market trading of Treasury securities and reduce the
Treasury's financing costs.

PA-31

TOTAL

P. 81

L7 J~LV
department

of the Treasury

~

Bureau of the Public Debt

~

Washington,

DC 20239

I

FOR IMMEDIATE RELEASE
August 15, 1990

„..

;

„. ij,g, CD~ACT;
:

Office of Financing
202/376-4350

TREASURY ANNOUNCES NEW SUBMISSION DEADLINE
FOR NONCOMPETITI VE TENDERS IN MARKETABLE SECURITY AUCTIONS
TO RELEASE AUCTION RESULTS EARLIER
The Treasury announced today that it set a new 12:00 noon Eastern time deadline for
the submission of noncompetitive tenders for its securities auctions. The change will be
effective with the 13- and 26-week Treasury bill auctions tentatively scheduled for
November 5, 1990. The deadline for submissions of competitive tenders will remain at
1:00 p, rn, , Eastern time. Currently, all tenders, both competitive and noncompetitive,
are required to be submitted by 1:00 p.m. , on auction day.
The noncompetitive submission deadline is being changed to permit auction results to
be released to the financial markets more quickly. The new deadline for noncompetitive
tenders, in addition to increased automation of Treasury's process for determining the
auction results, should permit Treasury to meet its goal of regularly releasinp auction
results by approximately 2:00 p.m. , Eastern time. Earlier release of auction results is
expected to facilitate secondary market trading of Treasury securities and reduce the
Treasury's Gnancing costs.

o0o

PA-31

TCITAL

P. Q1

apartment

of the Treasury

~ Nclshlnoton,

O.C. a Telephone SSI-204$

August

Deputy

14, 1990

JOHN E. ROBSON
Secretary of the Treasury

John E. Robson was appointed by President Bush to the position
Deputy Secretary of the Treasury on May 15, 1989. He was

confirmed

by

the United

of

States Senate for this position.

Secretary, the number two ranking official in the
Department, Mr. Robson acts as the chief operating
officer of the Treasury. He participates in all of the
Department's key policy deliberations and decisions and plays a
regular role in the relations with Congress.
The Deputy
Secretary assumes the duties and powers of the Secretary when the

As Deputy

Treasury

Secretary is absent.

is not new to government service, having served three
times previously in Presidential appointments
requiring Senate
confirmation.
These included: Chairman of the Civil Aeronautics
Board; General Counsel and then Under Secretary of the U. S.
He also served as Special
Department of Transportation.
Assistant to the Director of the Bureau of the Budget.
Mr. Robson

Mr. Robson's varied career includes law practice, corporate
executive and educator.
Prior to joining the Department, Mr.
Robson was Dean and Professor of Management at Emory University's
School of Business and Administration.
At G. D. Searle & Co. , a
Fortune 500 pharmaceutical
and consumer products firm, he served
as President and Chief Executive Officer and Executive
Vice-President and Chief Operating Officer.

practiced law as a partner and member of the executive
with the Chicago based law firm of Sidley and Austin,
and earlier as an Associate and then Partner with the law firm of
Leibman, Williams, Bennett, Baird, & Minow.

Mr. Robson

committee

graduated from Yale University (B.A. ) and Harvard
School of Law (J.D. ). He served as an enlisted man in
the United States Army.
Born in New York City to Edwin O. and
Elizabeth S. Robson, he was raised in Chicago, Illinois.
He
his
with
wife,
the
former
currently resides in Washington, D. C.
Margaret Elizabeth Zuehlke.
They have two children, Matthew and
Douglas.

Mr. Robson

University

was

oOo

NB-273

(r)

partment of the Treasury ~ Neshlnoton,

O.C. a Telephone SSI-2041

August

14, 1990

JOHN E. ROBSON
of the Treasury
Secretary
Deputy

John E. Robson was appointed by President Bush to the position
Deputy Secretary of the Treasury on May 15, 1989. He was
confirmed by the United States Senate for this position.

of

ranking official in the
Department, Mr. Robson acts as the chief operating
officer of the Treasury. He participates in all of the
Department's key policy deliberations and decisions and plays a
regular role in the relations with Congress.
The Deputy
Secretary assumes the duties and powers of the Secretary when the

As Deputy

Treasury

Secretary,

the number

two

Secretary is absent.

is not new to government service, having served three
times previously in Presidential appointments
requiring Senate
confirmation.
These included: Chairman of the Civil Aeronautics
Board; General Counsel and then Under Secretary of the U. S.
He also served as Special
Department of Transportation.
Assistant to the Director of the Bureau of the Budget.
Mr. Robson

Mr. Robson's varied career includes law practice, corporate
executive and educator.
Prior to joining the Department, Mr.
Robson was Dean and Professor of Management at Emory University's
At G. D. Searle & Co. , a
School of Business and Administration.
and consumer products firm, he served
Fortune 500 pharmaceutical
as President and Chief Executive Officer and Executive
Vice-President and Chief Operating Officer.

practiced law as a partner and member of the executive
with the Chicago based law firm of Sidley and Austin,
and earlier as an Associate and then Partner with the law firm of
Leibman, Williams, Bennett, Baird, & Minow.

Mr. Robson

committee

graduated from Yale University (B.A. ) and Harvard
University School of Law (J.D. ). He served as an enlisted man in
the United States Army.
Born in New York City to Edwin O. and
Elizabeth S. Robson, he was raised in Chicago, Illinois.
He
currently resides in Washington, D. C. with his wife, the former
Margaret Elizabeth Zuehlke.
They have two children, Matthew and
Douglas.
Mr. Robson

was

oOo

NB-273

(r)

DEPARTMENT OF THE TREASURY
„"' r&, .
WASHLNCTON
I-'-".
' i&'(
r,
t~„.

PXC No.

1183O7"'"'

-'.

,

! !'AUG

15 1990

Dear Mr. Patri3cis:
Zn my letter to you of August 5, 1990, I set forth the status
of various basics under Lvecutive Order No. 12723. Since that
date we have received additional mformation concerning
certain banks listed in Categories IZ R IZl of that letter
regarding their ownership and control. Based on that
information, we have determined that the following ban3cs
should not be considered blocked entities under Executive
Order No. 12723 and Executive Order No. 12725 of August 9,
1990:

Arab Banlcing Corporation
Banco Atlantico

e wil1 ccauplete our review of the
banks in Category IIE shortly.

t

Sincerely,
Richard

status of the remaining

j
Newc

Dizector
Office of Foreign Assets Control
Ernest T. Patrikls
General

Counsel

and

Executive Vice President
Federal Reserve Bank of New Tork
33

New

cherty Street
York,

New

York

10045

DEPARTMENT OF THE TREASURY
'P

/

FBLC

Nn.

1.18307 "'

ri,

( I, I&or

WASHINCTON
~

)

~l, 7

(]

-'."! i„AUG 15 1990
~

Patrikis:
letter to you of

Dear Mr.

Zn my
August 5, 1990, I set forth the
of various banks under Executive Order No. 12723. Sincestatus
that
date we have received additional information concerning
certain banks listed in Categories IZ & ZIl of that letter
regarding their ownership and control. Based on that
information, we have determined that the following ban3cs
should not be considered blocked entities under Zxecutive
Order No. 12723 and. Executive Order No. 12725 of August 9,
1990:

3Lrab BazMng

Corporation

Banco Atlantico

Vfe

wi11 complete our review of the status of the remaining
in Category IIZ shortly.

banks

S incerely,

Richard

Newco

Director
Office of Foreign Assets Contxol
Ernest T. Patrikis

Ceneral

Counsel

and

Executive Vice President
Fecieral Reserve Bank of New Fork
33 Liberty Street
New York, New York
10045

'c

"~4PFQ'p++&
'l2'. 90
1990
17,

FOR RELFWSR AT

August

.

~

w4$hlllgtoll,

NOON

TEKASURY ' S 52-WEEK

CONTACT:

Q.g. ~ ge)ypggny

gag. gyp

Office of Financing
202/376-4350

BILL OFFERING

of the Treasury, by this public notice, invites
tenders for approximately $10, 500 million of 364-day Treasury bills
to be dated August 30, 1990, and to mature August 29, 1991 (CUSIP
No. 912794 WT 7). This issue will provide about $1, 200 million
of new cash for the Treasury, as the maturing 52-week bill is outstanding in the amount of $9, 294 million.
Tenders will be received
at Federal Reserve Banks and Branches and at the Bureau of the
Public Debt, Washington, D. C. 20239-1500, prior to 1:00 p. m. ,
Eastern Daylight Saving time, Thursday, August 23, 1990.
The Department

The bills will be issued on a discount
and noncompetitive
bidding, and at maturity

basis under competitive
their par amount will
be payable without interest.
This series of bills will be issued
entirely in book-entry form in a minimum amount of $10, 000 and in
any higher $5, 000 multiple,
on the records either of the Federal
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury bills maturing August 30, 1990. In addition to the maturing
52-week bills, there are $16, 460 million of maturing bills which
were originally issued as 13-week and 26-week bills.
The disposition of this latter amount will be announced next week.
Federal Reserve Banks currently hold $7, 300 million for their own
account. This amount represents the combined holdings of such
accounts for the three issues of maturing bills. The current
holdings by Federal Reserve Banks as agents for foreign and international monetary authorities is not available.
This amount will
be provided in the August 21, 1990, 13- and 26-week bill announcement. Tenders from Federal Reserve Banks for their own account
and as agents for foreign and international
monetary authorities
will be accepted at the weighted average bank discount rate of
accepted competitive tenders. Additional amounts of the bills
may be issued to Federal Reserve Banks, as agents for foreign and
international monetary authorities, to the extent that the aggregate amount of tenders for such accounts exceeds the aggregate
For purposes of deteramount of maturing bills held by them.
mining such additional amounts, foreign and international
monetary
million
of
the
authorities are considered to hold $290
original
52-week issue. Tenders for bills to be maintained on the bookentry records of the Department of the Treasury should be submitted on Form PD 5176-3.
NB-922

)epartment hf-the+rppsorT
Q,

FOR RELEASE 'AT

August

12'00

17, 1990

NOON

~

washlnpton,
CONTACT:

p.c. ~ Telephone sss-2041
Office of Financing
202/376-4350

TREASURY'S 52-WEEK BILL OFFERING

The Department of the Treasury, by this public notice, invites
tenders for approximately $10, 500 million of 364-day Treasury bills
to be dated August 30, 1990, and to mature August 29, 1991 (CUSIP
No. 912794 WT 7). This issue will provide about $1, 200 million
of new cash for the Treasury, as the maturing 52-week bill is outstanding in the amount of $9, 294 million.
Tenders will be received
at Federal Reserve Banks and Branches and at the Bureau of the
Public Debt, Washington, D. C. 20239-1500, prior to 1:00 p. m. ,
Eastern Daylight Saving time, Thursday, August 23, 1990.
The bills will be issued on a discount
and noncompetitive
bidding, and at maturity

basis under competitive
their par amount will
be payable without interest.
This series of bills will be issued
entirely in hook-entry form in a minimum amount of $10, 000 and in
any higher $5, 000 multiple,
on the records either of the Federal
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury bills maturing August 30, 1990. In addition to the maturing
52-week bills, there are $16, 460 million of maturing bills which
were originally issued as 13-week and 26-week bills.
The disposition of this latter amount will be announced next week.
Federal Reserve Banks currently hold $7, 300 million for their own
account. This amount represents the combined holdings of such
accounts for the three issues of maturing bills. The current
holdings by Federal Reserve Banks as agents for foreign and interThis amount will
national monetary authorities is not available.
be provided in the August 21, 1990, 13- and 26-week bill announcement.
Tenders from Federal Reserve Banks for their own account
monetary authorities
and as agents for foreign and international
will be accepted at the weighted average bank discount rate of
accepted competitive tenders. Additional amounts of the bills
may be issued to Federal Reserve Banks, as agents for foreign and
international monetary authorities, to the extent that the aggregate amount of tenders for such accounts exceeds the aggregate
For purposes of deteramount of maturing bills held by them.
and international
foreign
amounts,
monetary
mining such additional
million
of the original
authorities are considered to hold $290
52-week issue. Tenders for bills to be maintained on the bookentry records of the Department of the Treasury should be submitted on Form PD 5176-3.
NB-922

l5U~URY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury s single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
trust companies and from responsible and recognized de lers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury s single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized de=lers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement for accepted tenders for bills to be maintained
on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.

If

bill is

at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
a

purchased

Department of the Treasury Circulars, Public Debt SeriesNos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of

the Public Debt.
8/89

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.

Treasury

Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
funds
on the issue date, in cash or other immediately-available
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.

If a bill is purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
of the Treasury Circulars, Public Debt SeriesNos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

0, + $'J

fedora. l fina. nci'ng bu. q.
WASHINGTON,

D. C.

2@/A l. -~
N-, qT

FOR IMMEDIATE

i, p,

I'-

RELEASE

FEDERAL FINANCING

August

BANK

20, l990

ACTIVITY

Charles D. Haworth, Secretary, Federal Financing Bank
(FFB), announced the following activity for the month of
July 1990.
FFB holdings of obligations issued, sold or guaranteed
other
Federal agencies totaled $162. 4 billion on
by
July 31, 1990, posting an increase of $4. 8 billion from
the level on June 30, 1990. This net change was the result
of increases in holdings of agency debt of $4, 673. 0 million
and in holdings of agency assets of $256. 8 million, while

of agency-guaranteed debt decreased by
$171.6 million. FFB made 54 disbursements during July.
FFB holdings on July 31, 1990 were the highest in the
bank's history.
Attached to this release are tables presenting FFB
July loan activity and FFB holdings as of July 31, 1990.
holdings

NB-923

L)gee" "". '
fed. era. l fina. nein@ hu.
q,
'

WASHINGTON,

D. C.

2@/A

9-~py

L

Q

13t:

'

(o
Q)

Q

August

20@

ACTIVITY

Charles D. Haworth, Secretary, Federal
Financing Bank
(FFB), announced the following
activity
for
the
month of
July 1990.
FFB holdings of obligations
issued, sold or guaranteed
other Federal agencies
totaled
4 billion on
July 31, 1990, posting an increase $162.
of
$4.
8 billion from
the level on June 30, 1990. This net
was the result
of increases in holdings of agency debtchange
of
$4, 673. 0 million
and in holdings of agency assets
of
$256.
8
million, while
holdings of agency-guaranteed
debt
decreased
by
$171.6 million. FFB made 54 disbursements
during
by

July.

FFB holdings
bank's history.

on

July 31, 1990 were the highest

in the

Attached to this release are tables presenting
FFB
July loan activity and FFB holdings
as of July 31, 1990.

NB-923

(0
(0

M

FOR IMMEDIATE RELEASE

BANK

(0

CO

CU

'

FEDERAL FINANCING

(0

LO

"'i

(', 'j f

0

cU

LL

page 2
FEDERAL FINANCING

JULY

of

5

BANK

1990 ACI'IVITY

ANKNT
OF ADVANCE

FINAL

INTEREST

INTEREST

MAIURITY

RATE

RATE

(semi-

(other than
semi-annual)

annual)

CREDIT UNION AIMINISIBATION

NATIONAL

'di

Central Li

Facili

+Nate ¹522

7/6

$13,860, 000. 00

10/5/90

8.044%

8.123%
8.122%
8.087%
8. 133%
8. 183%
8.192%
8. 171%
7.975%
7.984%
7.992%

RESOLVIION TRUST CORPORATION

Nate No. 90-04
Advance
Advance
Advance
Advance
Advance
Advance
Advance
Advance
Advance
Advanoe

¹1
¹3
¹4

7/12
7/16
7/17
7/18

185, 000, 000. 00
135,000, 000. 00
2 430' 000 000 00
100, 000, 000. 00

7/27

257, 000, 000. 00
435, 000, 000. 00

10/1/90
10/1/90

7.959%
7. 868%

7/31

240, 000, 000. 00
184, 000, 000. 00
143, 000, 000. 00
187, 000, 000. 00

7/16/90
7/23/90
7/31/90
8/6/90

8.043%
8.064%
7.917%
7.891%

7/1
7/15

280, 000, 000. 00
190, 000, 000. 00

10/1/91
10/1/91

8.214%
8. 050%

7/9
7/10

¹5
¹6
¹7
¹8
¹9
¹10

26, 580, 000, 000. 00
198, 000, 000. 00
190I 000 000 00
118,000, 000. 00
310, 000, 000. 00

10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90

7/2
7/3
7/5

¹2

7/11

~

~

26~ 000~ 000 00

g

Note No. 90M5
Advance
Advance

¹1
¹2

7/31

TENNESSEE VALIDLY AVIROiKIY

Short-term
Short-term
Short-term
Short-term

FAINTER'S

¹43
¹44
¹45
¹46

7/9
7/16
7/23

KNE

RHIF — CBO
RHIF — CEG

+rollaver

Bond
Bond
Band
Bond

¹57543
¹57544

8.383%
8.212%

ann.
ann.

page 2
FEDERAL FINANCING

of

5

BANK

1990 ACTIVITY

JULY

AMOUNT

FINAL

INI'EREST

INIKKST

OF ADVANCE

MATURITY

RATE

RATE

(semi-

(other than
semi-annual)

annual)
AGENCY DEBT

CREDIT UNION AIMINISIRATIQN

NATIONAL

'di

Central Li

Facili

+Note ¹522

$13 860 000 00

10/5/90

8 ~ 044%

26/580/000, 000. 00
198, 000, 000. 00
190, 000, 000. 00
118,000, 000. 00
310' 000 000 00
26, 000, 000. 00
185, 000, 000. 00
135~ 000~ 000 00
2 430 I 000~ 000 00
100, 000, 000. 00

10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90
10/1/90

8. 123%
8. 122%

8. 087%
8. 133%
8. 183%
8. 192%
8.171%
7.975%
7.984%
7.992%

257 000 000 00
435 ~ 000 ~ 000 ~ 00

10/1/90
10/1/90

7 959%
7 868%

7/16/90
7/23/90
7/31/90
8/6/90

8.043%

7/31

240, 000, 000. 00
184 000' 000 00
143, 000, 000. 00
187, 000, 000. 00

7.917%
7.891%

7/1
7/15

280, 000, 000. 00
190, 000, 000. 00

10/1/91
10/1/91

8.214%
8.050%

7/6

~

g

RESOIVZION TRUST CDRR)RATION

Note No. 90-04
Advance
Advance
Advance
Advance
Advance
Advance
Advance
Advance
Advance
Advance

¹1

7/2
7/3
7/5

¹2

¹3
¹4

¹5
¹6
¹7
¹8
¹9
¹10

7/9
7/10

7/11
7/12
7/16
7/17
7/18

g

g

Note No. 90-05
Advance
Advance

¹1

7/27

¹2

7/31

g

g

~

TENNESSEE VALIDLY M7IR3RITY

Short-term Bond ¹43
Short-term Bond ¹44
Short-term Band ¹45
Short-term Bond ¹46

7/9
7/16
7/23

g

8 ~ 064%

FARMER'S HCNE

RHIF — CBO
RHIF — CBO

+rollover

¹57543
¹57544

8.383%
8.212%

ann.
ann.

Page 3
FEDERAL FINANCING

JULY

1990

5

BANK

ACTDHTY

AIKUNT

OF ADVANCE

FINAL
MAIURITY

INI'E REST

IVIES~

RATE

RATE

(semi-

(other than
semi-annual

annual)

GOVERNMEDZ

of

— GUARANTEED IDANS

DEPARBKVI' OF DEFENSE

Forei

Sales

Mili

7/25

Kenya 12
DEPARIMEN1'

Cananuni

OF HOUSING

Devel

&

*Pasadena,
*Pasadena,

7/11
7/11

CA.
CA.

RURAL EIZCTRIFICATION

Electric ¹175A
Electric ¹175A
*Associated Electric ¹328
*Associated Electric ¹328
*Cajun Electric ¹197A
*Colorado-Ute Electric ¹8A
*Colorado-Ute Electric ¹78A
*Colorado-Ute Electric ¹78A
*Colorado-Ute Electric ¹78A
*Colorado-Ute Electric ¹96A
*Colorado-Ute Electric ¹168A
*Colorado-Ute Electric ¹203A
*Colorado-Ute Electric ¹203A
*Colorado-Ute Electric ¹203A
*Colorado-Ute Electric ¹203A
*Colorado-Ute Electric ¹276
*Colorado-Ute Electric ¹276
*Colorado-Ute Electric ¹297
*Colorado-Ute Electric ¹297

*Cooperative Power Assoc. ¹130A

+maturity

extension

7. 942%

1, 016, 902. 34

7/1/96
7/1/98
7/16/90
7/16/90

8. 469%
8.499%
8. 192%
8. 192%

8. 648%
8. 680%
8. 360%
8. 360%

9/30/92
9/30/92
9/30/92
9/30/92
1/2/18
1/3/12
12/31/13
12/31/13
12/31/13
12/31/15
12/31/15
1/3/17
1/3/17
1/3/17
1/3/17
1/3/17
1/3/17
1/2/18
1/2/18
9/30/92
9/30/92
9/30/92
9/30/92

8. 387%
8. 387%
8. 385%
8. 387%
8. 541%
8. 544%
8. 542%
8. 542%
8. 542%
8. 541%
8. 541%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 385%
8. 385%
8. 385%
8. 385%

8. 301% qtr.
8. 301% qtr.
8. 299% qtr.
8. 301% qtr.
8. 452% qtr.
8. 455% qtr.
8. 453% qtr.
8. 453% qtr.
8. 453% qtr.
8. 452% qtr.
8. 452% qtr.
8. 451% qtr.
8. 451% qtr.
8.451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 299% qtr.
8. 299% qtr.
8. 299% qtr.
8. 299% qtr.

¹320
¹320
¹320

2, 890, 000. 00
1, 165, 457. 11
98, 354. 95

ann.
ann.
ann.
ann.

AIMINISTRATION

*Allegheny
*Allegheny

+Oglethorpe

1/25/91

t
7/2
7/2

Power
Power
Power

288, 987.04

URBAN DEVEIDRKNT

*Florence, S.C.
*Syracuse, N. Y.

~lethorpe
~lethorpe

S

7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2

7/2
7/2
7/2
7/2
7/2
7/2
7/2

2, 516, 939.92
3, 112,704. 88
8, 589, 619.83
4, 398, 688. 12
21, 106, 598.96
564, 810.75
353, 781.76
404, 267. 68
2, 520, 513.60
950, 546. 48
982, 768. 44

1, 318, 063. 12
3g222g 357 92

574I736. 88
3, 134, 231.60
1, 919,579.88

1, 465, 578. 96
2, 506, 747. 94
2, 927, 073. 12
9, 090, 909.07
8, 480I396. 69
9, 486, 809.93
13, 570, 000. 00

)

Page 3
FEDERAL FINANCING

JULY

1990

of

5

BANK

ACZIVITY

AMDUNZ

OF ADVANCE

(semiannual)

GOVIWNMENZ

DEPARIMENT

Fore i

— GUARAYZEZD IOANS
OF DEFENSE

Mil i

Sales
7/25

Kenya 12
DEPARBGWZ OF HOUSING
Communi

Devel

& URBAN

S

288, 987. 04

1/25/91

7. 942%

7/1/96
7/1/98
7/16/90
7/16/90

8. 469%
8. 499%
8. 192%
8. 192%

8. 648 '
8. 680%
8. 360%
8. 360%

9/30/92
9/30/92
9/30/92
9/30/92
1/2/18
1/3/12
12/31/13
12/31/13
12/31/13
12/31/15
12/31/15
1/3/17
1/3/17
1/3/17
1/3/17
1/3/17
1/3/17
1/2/18
1/2/18
9/30/92
9/30/92
9/30/92
9/30/92

8. 387%
8. 387%
8. 385%
8. 387%
8.541%
8. 544%
8. 542%
8. 542%
8. 542%
8. 541%
8. 541%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 540%
8. 385%
8. 385%
8. 385%
8. 385%

8. 301% qtr.
8. 301% qtr.
8. 299% qtr.
8. 301% qtr.
8. 452% qtr.
8. 455% qtr.
8. 453% qtr.
8. 453% qtr.
8. 453% qtr.
8. 452% qtr.
8. 452% qtr.
8.451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 451% qtr.
8. 299% qtr.
8. 299% qtr.
8. 299% qtr.
8. 299% qtr.

DEVEljDRKNZ

t

*Florence, S.C.
*Syracuse, N. Y.

7/2
7/2

*Pasadena,
*Pasadena,

7/11
7/11

1, 016, 902. 34
2, 890, 000. 00
1, 165, 457. 11
98, 354. 95

7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/2
7/Z
7/2
7/2
7/2
7/2
7/2
7/2

2, 516, 939.92
3, 112,704. 88
8, 589, 619.83
4, 398, 688. 12
21, 106, 598. 96
564, 810.75
353, 781.76
404/ 267. 68
2, 520, 513.60
950, 546. 48
982, 768. 44
1, 318, 063. 12
3, 222, 357.92
574, 736.88
3, 134, 231.60
1,919,579. 88
1, 465, 578. 96
2, 506, 747. 94
2, 927, 073. 12
9, 090, 909.07
8, 480, 396.69
9, 486, 809.93
13, 570, 000. 00

CA.
CA.

Electric $175A
Electric $175A
«Associated Electric 4328
*Associated Electric 4328
*Cajun Electric 4197A
*Colorado-Ute Electric 48A
*Colorado-Ute Electric 478A
*Colorado-Ute Electric 478A
*Colorado-Ute Electric 478A
*Colorado-Ute Electric 496A
*Colorado-Ute Electric 4168A
*Colorad~ Electric 4203A

~Allegheny
*Allegheny

*Colorado-Ute Electr ic
*Colorado-Ute Electric
*Colorado-Ute Electric
*Colorado-Ute Electric
*Colorado-Ute Electric
*Colorado-Ute Electric

*Colorad~ Electric
*CooI~tive
+Oglethorpe
+Oglethorpe

Kglethorpe

+maturity

(other than
semi-annual)

~

4203A
g203A
4203A

4276
4276

f297
4297

Power Assoc. 4130A
Power 4320

4320

Power 4320

extension

ann.
ann.
ann.
ann.

Page
FED15%L FINANCING

1990

JULY

~

+W~

Seven

States

Note A-90-11

+maturity

extension

Co

BANK

INIEREST

IVI'ER EST
RATE

(semiannual)

(other than
semi-annual)

3, 622, 089. 59

7/11

337, 000. 00
61, 000. 00

9/30/92
12/31/13
1/2/18
9/30/92
12/31/18
12/31/18

8. 385%
8. 539%
8. 538%
8. 384%
8. 524%
8. 688%

8. 299% qtr.
8. 450% qtr.
8. 449% qtr.
8. 298% qtr.
8. 435% qtr.
8. 596% qtr.

7/31

631,888, 123.21

10/31/90

7. 893%

AEMINISI'RATION

+United Power Assoc. 4129A
+Wolverine
4183A
Valley Power 4206
*Wabash Valley Power 4206

5

RATE

OF ADVANCE

*Southern Mississippi Elec. 4330
*United Power Assoc. 467A

of

ACTIVITY

AK3UÃI'

RURAL ELECTRIFICATION

4

continued
S

7/2
7/2
7/2
7/5

FINAL
MAIURITY

241, 949. 58
552, 941.20
14, 477, 118.64

ration

Page
FEDERAL FINANCING

JULY

FINAL

INTEREST

INTEREST

%DURITY

RATE

RATE

(semi-

*Southern Mississippi Elec. 4330
*United Power Assoc. $67A
+United Power Assoc. 4129A
*Wolverine Power 4183A
*Wabash Valley Power 4206
*Wabash Valley Power 4206

Seven

States

Note A-90-11

+maturity

extension

Co

)

(other than
semi-annual)

continued

7/11

241, 949. 58
552, 941.20
14, 477, 118.64
3, 622, 089. 59
337, 000. 00
61, 000. 00

9/30/92
12/31/13
1/2/18
9/30/92
12/31/18
12/31/18

8. 385%
8. 539%
8. 538%
8. 384%
8. 524%
8. 688%

7/31

631, 888, 123.21

10/31/90

7. 893%

$
7/2
7/2
7/2
7/5

5

BANK

annual
ELECIRIFICATION ACMINISIRATION

of

1990 ACIIVITY

AKKÃ1'
OF ADVANCE

RURAL

4

ration

8. 299% qtr.
8. 450% qtr.
8. 449% qtr.
8. 298% qtr.
8.435% qtr.
8. 596% qtr.

Page
FEDERAL FINANCING

5

of

5

BANK HOLDINGS

(in millions)

.

~ogram
gency Debt:
i xport-Import Bank
! ~CUA-Central Liquidity Facility
Trust Corporation
~ esolution
ennessee Valley Authority
:
:'i( . S. Postal
Service

Jul

31 1990

$

11,143.9
55. 0
30, 964. 0
15, 012. 0

I~

sub-total*
agency Assets:

i.

armers

Home

Administration

DHHS-Health Maintenance Org.
DHHS-Medical Facilities
Rural Electrification Admin. -CBO

sub-total*
Government-Guaranteed
Lending:
DOD-Foreign Military Sales
DEd. Student Loan Marketing Assn.
Dev. Block Grant
DHUD-Community
DHUD-Public Housing Notes +

+
General Services Administration
DOI-Guam Power Authority
DOI-Virgin Islands
Co. +
NASA Space Communications
DON-Shzp Lease Financing
Rural Electrification Administration
SBA-Small Business Investment Cos.
SBA-State/Local Development Cos.
TVA-Seven States Energy Corp.
DOT-Section 511
DOT-WMATA

sub-total*
*

total*

may

no

figures
+does not include

$

o a

ue

capitalized

o roun xng

interest

$

9 0

Net Chan e

11,143.9

$

5, 897. 8
63, 072. 7

52, 171.0
69. 2
82. 7
4, 135.2

51, 901.0
74. 7
90. 1
4, 135.2

270 ' 0

9. 1

-5. 5
-7.
-0-4
-0. 3

56, 466. 9

56, 210. 1

256. 8

9, 840. 0

9, 887. 0

-46.
-0-9
-1.
-0-4
-0-0-0.
-0-2
-0-101.4
-27. 2

4, 880. 0
257. 6
1, 950-8
367. 3
30. 3
25. 3
9
1, 095.
4
1, 672.
19, 066. 1
425. 7
751.7
2,' 339. 5
23. 7
177. 0
42, 903. 4
162, 443. 0

$

4, 880. 0
259. 0
8
1, 950.
367. 3
30. 3
25. 4
1, 095. 9
1, 672. 4
19, 167. 5
452. 9
757. 3
2, 328. 4
23. 7
177. 0
43, 075. 0
157, 684. 7

FY

'90 Net

-00. 1
4, 596. 9
76.
-0-0

54. 9
26, 367. 1
14, 936. 0
5, 897. 8
58, 399.6

8. 8

Small Business Administration

grand

June 30

$

4, 673. 0

-348. 5
-30. 0
-25. 8
-44. 5

-10.8
-0. 6
-0. 7

100.7
-208. 8
-48 ' 2

-129.6
-47. 6

44. 6
-13.
-0-5

-0-171.6
4, 758. 3

160.3
30, 964. 0
-2,
455. 0
-297. 2
28, 315.7

-56. 4

-1, 410.
-5. 05
-5. 4
-47 ' 5
-2. 8
-1, 201.2

-5. 6
11.
-0-0

$

Chan

$

-763. 4
26, 351.1

e

Page
FEDERAL FINANCING

of

5

5

BANK HOLDINGS

(in millions)

Jul

~ogram
~&~~ency Debt:
g;:cport-Import Bank
~t&~'UA-Central Liquidity Facility
Trust Corporation
;. lw~!solution
-:. nnessee
Valley Authority
i), S. Postal Service

$

~

sub-total*
!!gency Assets:
i'i!rmers

Home

Administration

QHHS-Health Maintenance Org.
DHHS-Medical Facilities
Rural Electrification Admin. -CBO

sub-total*
Government-Guaranteed
Lending:
DOD-Foreign Military Sales
DEd. -Student Loan Marketinq Assn.
Dev. Block Crant
DHUD-Community
DHUD-Public Housinq Notes +

t
General Services Administration
DOI-Guam Power Authority
DOI-Virgin Islands
Co. +
NASA Space Communications
DON-Shxp Lease Financing
Rural Electrification Administration
SBA-Small Business Investment Cos.
SBA-State/Local Development Cos.
TVA-Seven States Energy Corp.
DOT-Section 511
DOT-WMATA

sub-total*
*

total*

may

no

figures
+does not include

$

o a

ue

capitalized

o roun xng

interest

90

11,143.9
55. 0
30, 964. 0
15, 012. 0

June 30
$

990

Net Chan e

11,143.9

5, 897. 8
63, 072. 7

54. 9
26, 367. 1
14, 936. 0
5, 897. 8
58, 399.6

52, 171.0
69. 2
82. 7
4, 135.2

$

FY

'90 Net

-00. 1
4, 596. 9
76 0
-0-

$

~

Chan

160.3
30, 964. 0
-2, 455. 0
-297. 2

-56. 4

4, 673. 0

28, 315 ' 7

51, 901.0
74. 7
90. 1
4, 135.2

270. 0

-1, 410.
-5. 0

9. 1

-5. 5
-7.
-0-4
-0. 3

56, 466. 9

56, 210. 1

256. 8

-1, 201.2

9, 840. 0

9, 887. 0

-46.
-0-9
-1.
-0-4
-0-0-0.
-0-2
-0-101.4
-27. 2
-5. 6
11.
-0-0
-0-171.6

-348. 5
-30. 0
-25. 8
-44. 5

8. 8

Small Business Administration

grand

31

4, 880. 0
257. 6
8
1, 950.
367. 3
30. 3
25. 3
9
1, 095.
1, 672. 4
19, 066. 1
425. 7
751.7
2, 339. 5
23. 7
177. 0
42, 903. 4
162, 443. 0

$

4, 880. 0
259. 0
8
1, 950.
367. 3
30. 3
25. 4
1, 095. 9
1, 672. 4
19, 167. 5
452. 9
757. 3
2,' 328. 4
23. 7
177. 0
43, 075. 0
157, 684. 7

$

4, 758. 3

5

-5 ' 4

-47. 5

-2. 8

-10.8
-0.
-0. 76
100.7

-48. 2
-208. 8
-129.6
-47. 6

44. 6
-13.
-0-5

$

-763. 4
26, 351.1

e

gf, hSPp

UBLIC DEBT NEW
Department

of the Treasury

~

BuItda!u'of tfte Public

FOR IMMEDIATE RELEASE

August

Debt: ~ Washington, DC 20239

Office of Financing

CONTACT:

20, 1990

202/376-4350
RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS
Dt/ T 0+ Hp To~
)

of

Tenders for $9, 202 million of 13-week bills' and for $9, 203
million
26-week bills, both to be issued on August 23, 1990, were accepted today.

OF ACCEPTED
COMPETITIVE BIDS:

13-week

RANGE

Average

23

Investment

7. 76%
7. 82%
7. 80%

7. 51%
7. 56%
7. 55%

Low

High

Tenders
Tenders

maturin
Discount

bills

November

26-week bills
21 1991
Februar
Investment
Price
Rate 1

1990 : maturin
Discount
Price : Rate

98. 081 : 7. 42%
98. 068 : 7. 46%
98. 071 : 7. 45%

at the high discount rate for the
at the high discount rate for the

13-week
26-week

7. 82%
7. 86%
7. 85%

bills
bills

96. 249
96. 229
96. 234

allotted
allotted

were
were

96%.
66%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)

Location
Boston
New

$

York

Philadelphia
Cleveland
Richmond

Atlanta

36, 200
17, 545, 700
18, 605
47, 190
73, 415
33, 350

1, 702, 975

Chicago
St. Louis
Minneapolis
Kansas City

TOTALS

~Te

$17, 444, 010
1, 297, 225
$18, 741, 235
2, 400, 000

$5, 051, 045
1, 297, 225
$6, 348, 270
2, 400, 000

86, 610
86, 610
$21, 205, 580 $9, 202, 380

454, 690

454, 690

$21, 595, 925

$9, 202, 960

$18, 708, 785
2, 410, 185

~1

1, 522, 530

:

$10, 590 thousand of 13-week bills and an additional $39, 510
of 26-week bills will be issued to foreign official institutions for

additional

thousand

31, 500
8, 036, 430
15, 090
34, 320
46, 370
29, 995
76, 230

$5, 183, 055
1, 522, 530
$6, 705, 585
2, 410, 185

Subtotal, Public
Federal Reserve

new

$

24, 455
466, 165
702, 350
$9, 202, 380

$17, 186, 255

TOTALS

36, 200
7, 644, 700
18, 605
47, 190
73, 415
33, 350
77, 975
26, 010
10, 580
41, 385

ted
Ance

22, 295
10, 570
50, 200
18, 985
163, 135
667, 840
$9, 202, 960

Competitive
Noncompetitive

Foreign Official
Ins ti tut ions

$

Received
31, 500
$
18, 520, 375
15, 090
34, 320
46, 370
29, 995
1, 526, 230
26, 975

10, 570
50, 200
18, 985
617, 475
667, 840
$21, 595, 925

36, 210
10, 580
41, 385
24, 455
933, 165
702, 350
$21, 205, 580

Dallas
San Francisco
Treasury

An

ted
Ance

Receiued

cash.
Equivalent

coupon-issue

yield.

gf hS(tp

UBLI
Department
FOR IMMEDIATE

of the Treasury

DEBT NEW
~

BuIrdau'of the Public Debt

RELEASE

j;j.,'( „ o g

20, 1990

August

Washington,

I

DC 20239

Office of Financing

CONTACT:

~cjI

,

~

202/376-4350

( g

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

I:'-i F. .
Tenders for $9, 202 million of 13-week bills' and for $9, 203
million
26-week bills, both to be issued on August 23, 1990, were accepted today.

of

OF ACCEPTED
COMPETITIVE BIDS:

RANGE

13-week bills
November 23
maturin
Discount
Investment

7. 51%
7. 56%
7. 55%

Low

High

Average

7.
7. 82%
7. 80%
76%%uc

26-week bills
Februar
21
Investment

1990 : maturin
Discount
Price
Rate

98. 081
98. 068
98. 071

7. 42%
7. 46%
7. 45%

at the high discount rate for the
at the high discount rate for the

Tenders
Tenders

13-week
26-week

7. 82%
7. 86%
7. 85%

bills
bills

were
were

1991

96. 249
96. 229
96. 234

allotted
allotted

96%.
66%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)

Location
Boston
New

$

York

Philadelphia
Cleveland
Richmond

Atlanta

Subtotal, Public
Federal Reserve

Foreign Official

Institutions
TOTALS

additional

thousand

+1

of

26-week

8, 036, 430
15, 090

$17, 444, 010
1, 297, 225
$18, 741, 235
2, 400, 000

$5, 051, 045
1, 297, 225
$6, 348, 270
2, 400, 000

86, 610
86, 610
$21, 205, 580 $9, 202, 380

454, 690

454, 690

$21, 595, 925

$9, 202, 960

:

$10, 590 thousand of 13-week bills and an additional $39, 510
bills will be issued to foreign official institutions for

cash.
Equivalent

31, 500

$17, 186, 255 $5, 183, 055
1, 522, 530 1, 522, 530
$18, 708, 785 $6, 705, 585
2, 410, 185 2, 410, 185

702, 350
$21, 205, 580

~Te

ted

24, 455
466, 165
702, 350
$9, 202, 380

933, 165

Competitive
Noncompetitive

36, 200
7, 644, 700
18, 605
47, 190
73, 415
33, 350
77, 975
26, 010
10, 580
41, 385

~Acce

10, 570
50, 200
18, 985
617, 475
667, 840
$21, 595, 925

24, 455

TOTALS

$

Received
31, 500
$
375
520,
18,
15, 090
34, 320
46, 370
29, 995
1, 526, 230
26, 975

34, 320
46, 370
29, 995
76, 230
22, 295
10, 570
50, 200
18, 985
163, 135
667, 840
$9, 202, 960

36, 210
10, 580
41, 385

Dallas
San Francisco
Treasury

new

36, 200
17, 545, 700
18, 605
47, 190
73, 415
33, 350

1, 702, 975

Chicago
St. Louis
Minneapolis
Kansas City

An

ted
Ance

Receiued

coupon-issue

yield.

/

f

)

~UCli. .

..

., j&

~

r

Ll

)portment of the Treasury
FOR IMMEDIATE

The Treasury
month

Washington, -+.C. ~ Telephone 585-204'
'-"

KUG

RELEASE

Monthly

for the

~

August

21, 1990

Release of U. S. Reserve Assets

Department

of July 1990.

released

today

U. S.

reserve assets data

As indicated
in this table, U. S. reserve assets amounted to
S77, 906 million at the end of July, up from S77, 298 million in June.

U. S.

Reserve Assets

(in millions

Total

End

of
Month

Reserve
Assets

June

77, 298

July

77, 906

1/ Valued

of dollars)

Special

Gold

S tock

11,065
11, 064

Drawing

1/

Rights

2/3/

Foreign
Currencies

10, 490

47, 294

10, 699

47, 457

Reserve

Position

4/

in

IMF

2/

8, 449
8, 686

at S42. 2222 per f ine troy ounce.

2/ Beg inning July 1974, the IMF adopted a technique for valuing the SDR
based on a weighted average of exchange rates for the currencies of
The U. S. SDR holdings
and reserve
selected member countries.
pos i tion in the IMF also are valued on this basis beginning July

1974.

3/ Incluaes

4/ Valued

NB-925

allocations

of

SDRs by

the

IMF

at current market exchange rates.

plus transactions

jn SDRs.

a

portment of the Treasury

~

P, i

washington, -p
I

FOR IMMEDIATE

The Treasury
month

Telephone $$$-2$

v

RELEASE

Monthly

for the

g

c. ~

August

21, 199

Release of U. S. Reserve Assets

Department

of July 1990.

today

released

U. S.

reserve assets data

As indicated
in this table, U. S. reserve assets amounted to
S77, 906 million at the end of July, up from $77, 298 million in June.

U. S.

Reserve Assets

(in millions

Total

E. nd

of

Reserve

Special
Gold

Month

Assets

S tock

June

77, 298

July

77, 906

11,065
11, 064

1/ Valued

of dollars)

Drawing

1/

Rights

2/3/

Foreign
Currencies

10, 490

47, 294

10, 699

47, 457

Reserve

Position

4/

in

IMF

2/

8, 449
8, 686

at $42. 2222 per fine troy ounces

2/ Beginning July 1974, the IMF adopted a technique for valuing the SDR
based on a weighted average of exchange rates for the currencies of
and reserve
The U. S. SDR holdings
selected member countries.
this
basis
on
valued
beginning July
position in the IMF also are

1974.

3/ Includes

4/ Valued

NB-925

allocations

of

SDRs by

the

IMF

at current market exchange rates.

plus transactions

in SDRs.

«Ui

9I.
Ipariment of the Treasury ~ Washlnyton,
Dv',
,

(}y

FOR RELEASE AT

21

August

4 00

1990

I

)&~,

.

O.C. ~ T'elephone
CONTACT:

P. M.

ISI-204~

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
for two series of Treasury bills totaling approximately
$18, 400 million, to be issued August 30, 1990.
This offering

tenders

will provide about $1, 95Q million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of
460 million.
Tenders will be received at Federal Reserve Banks andS16,
Branches
at
the Bureau of the Public Debt, Washington, D. C. 20239. prior toand1:00
p. m. , Eastern Daylight Saving time, Monday, August 27, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately
million, representing an additional amount of bills datedS 9, 200
May 31, 1990,
and to mature
November 29. 1990 (CUSIP No.
912794 VK 7), currently outstanding in the amount of S8, 418 million,
the additional and original bills to be freely interchangeable.
182-day
August

912794

bills for

30, 1990,

VX

9).

and

approximately

to mature

S 9, 200 million,
to be dated
February 28, 1991 (CUSIP No.

The bills will be issued on a discount
and noncompetitive
bidding, and at maturity

basis under competitive
their par amount will
be payable without interest.
Both series of bills will be issued
entirely in book-entry form in a minimum amount of S10, 000 and in
any higher $5, 000 multiple,
on the records either of the Federal
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury
bills maturing August 30, 1990.
In addition to the maturing
13-week and 26-week bills, there are S 9, 294
million of maturing
52-week bills.
The disposition of this latter amount was announced
last week. Tenders from Federal Reserve Banks for their own account
and as agents for foreign and international
monetary authorities will
be accepted at the weighted average bank discount rates of accepted
competitive tenders.
Additional amounts of the bills may be issued
to Federal Reserve Banks, as agents for foreign and international
monetary authorities,
to the extent that the aggregate amount of
tenders for such accounts exceeds the aggregate amount of maturing
bills held by them. For purposes of determining such additional
amounts, foreign and international
monetary authorities are considered to hold S1, 374 million of the original 13-week and 26-week
issues. Federal Reserve Banks currently hold $1, 664 million as
agents for foreign and international monetary authorities, and $7 303
million for their own account. These amounts represent the combined
holdings of such accounts for the three issues of maturing bills.
Tenders for bills to be maintained on the book-entry records of
Department of the Treasury should be submitted on Form PD 5176-1
(for 13-week series) or Form PD 5176-2 (for 26-week series).

OI

partment of the Treasury

~

Washlnyton, D.c. ~ Telephone 566-2O4
'. . Ti Tt, '4P.

DE'.

FOR RELEASE AT

A

4:00 P. M.

21, 1990

August

Qt-

~

CONTACT:

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
tenders for two series of Treasury bills totaling approximately
$18, 400 million, to be issued August 30, 199Q.
This offering

will provide about $1, 95Q million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of S16, 460 million.
Tenders will be received at Federal Reserve Banks and Branches and at
the Bureau of the Public Debt, Washington, D. C. 20239, prior to 1:00
p. m. , Eastern Daylight Saving time, Monday, August 27, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately S 9, 200
representing an additional amount of bills dated
November 29, 1990 (CUSIP No.
May 31, 1990,
and to mature
912794 VK 7), currently outstanding in the amount of $8, 418 million,
the additional and original bills to be freely interchangeable.

million,

182-day
August

912794

bills for

30, 1990,

VX

9).

and

approximately

to mature

to be dated
S 9, 200 million,
February 28, 1991 (CUSIP No.

bills will

be issued on a discount

bills will

be issued

basis under competitive
and noncompetitive
bidding, and at maturity their par amount will
Both series of bills will be issued
be payable without interest.
entirely in book-entry form in a minimum amount of S10, 000 and in
on the records either of the Federal
any higher S5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury
The

for cash and in exchange for Treasury
In addition to the maturing
bills maturing August 30, 1990.
million of maturing
13-week and 26-week bills, there are S 9, 294
52-week bills.
The disposition of this latter amount was announced
last week. Tenders from Federal Reserve Banks for their own account
monetary authorities will
and as agents for foreign and international
discount
rates of accepted
bank
average
the
weighted
be accepted at
bills
the
of
amounts
may be issued
Additional
competitive tenders.
and
international
foreign
for
to Federal Reserve Banks, as agents
to the extent that the aggregate amount of
monetary authorities,
tenders for such accounts exceeds the aggregate amount of maturing
bills held by them. For purposes of determining such additional
monetary authorities are consid
amounts, foreign and international
original 13-week and 26-week
the
of
million
ered to hold $1, 374
hold S1, 664 million as
currently
Banks
issues. Federal Reserve
authorities, and $7 303
monetary
agents for foreign and international
amounts
represent
the combined
million for their own account. These
holdings of such accounts for the three issues of maturing bills.
Tenders for bills to be maintained on the book-entry records of
Department of the Treasury should be submitted on Form PD
(for 13-week series) or Form PD 5176-2 (for 26-week series).
The

TEQULSURY '

S

13-, 2 6-,

AND

52-WEEK BILL OFFERINGS,

Page 2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 15%. Fractions may not be used.

bidder, as defined in Treasury's single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
Banking institutions and dealers who make primary
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
will be made on all accepted tenders for the
A cash adjustment
difference between the par payment submitted and the actual

issue price as determined
deposit need

in the auction.

accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TEGASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 15%. Fractions may not be used.

bidder, as defined in Treasury's single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
Banking institutions and dealers who make primary
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers,
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.

if

A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
will be made on all accepted tenders for the
A cash adjustment
between
the par payment submitted and the actual
difference

issue price as determined in the auction.
No deposit need accompany tenders from incorporated
banks
and trust companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
8/89

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement for accepted tenders for bills to be maintained
on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.

If a bill is purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
Department of the Treasury Circulars, Public Debt SeriesNos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of

the Public Debt.
8/89

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.

If a bill is purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
of the Treasury Circulars, Public Debt SeriesNos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

of the Treesury

Department

FOR IMMEDIATE

August

~

Washington,

D.C. a Telephone 566-204$

Contact:

RELEASE

22, 1990

Crispen
(202) 566-5252

Cheryl

L. Coggan Appointed
Executive Director of the
United States Savings Bonds Division
Leland

Leland L. Coggan was appointed Executive Director of the
Savings Bonds Division, Department of the Treasury, by
United States Treasurer Catalina Vasquez Villalpando on
U. ST

August

10, 1990.

the Treasury

He was

Nicholas

sworn

F. Brady

In making the appointment,
"Mr. Coggan's legal background
in marketing financial products
invaluable to the Savings Bonds
As

national

into office by Secretary of
10, 1990.

on August

Treasurer Villalpando said,
his extensive experience
real estate will be
Division. "

and
and

Mr. Coggan will direct the
marketing and sales of Savings Bonds.

Executive Director,
program

for

effort uses Savings Bond Division resources
from the business, banking and communications
sectors. The total value of Savings Bonds held by Americans
at the end of June 1990, was $121.86 billion, the highest on

This national
and volunteers

record.

Prior to his appointment as Executive Director,
Coggan served as President of Coggan & Co. , Inc. , a
securities and investment firm in Dallas, Texas.

Mr.

from Texas Christian University jn
U. S. Marine Corps, from 1953 to
the
l953. He then served in
Following
1955, where he attained the rank of Captain.
D. degree
active military service, Mr. Coggan earned his
School
of
Law
University
in Da]]as,
Methodist
from Southern
into
went
private
practice and
Texas. Upon graduation, he
became a partner with the Dallas law firm of Burford, Ryburn
and Ford in 1960.
Mr. Coggan graduated

J.

NB-927

)epcirtment of the Treasvry

FOR IMMEDIATE

August

~

Washington,

D.C. a Telephone 568-204

Contact:

RELEASE

22, 1990

Crispen
566-5252
(202)

Cheryl

Leland L. Coggan Appointed

Executive Director of the
United States Savings Bonds Division
Leland L. Coggan was appointed Executive Director of the
Bonds Division, Department of the Treasury, by
United States Treasurer Catalina Vasquez Villalpando on
U. S. Savings

August

10, 1990.

the Treasury

He was

Nicholas

F.

sworn into office by Secretary
Brady on August 10, 1990.

of

Treasurer Villalpando said,
In making the appointment,
"Mr. Coggan's legal background and his extensive experience
in marketing financial products and real estate will be
invaluable to the Savings Bonds Division. "
As Executive Director, Mr. Coggan will direct the
national program for marketing and sales of Savings Bonds.
This national effort uses Savings Bond Division resources
from the business, banking and communications
and volunteers

sectors.

total value of Savings Bonds held by Americans
June
1990, was $121.86 billion, the highest on
at the end of
The

record.

Prior to his appointment as Executive Director,
Coggan served as President of Coggan & Co. , Inc. , a
securities and investment firm in Dallas, Texas.

Mr.

from Texas Christian University in
U. S. Marine Corps, from 1953 to
the
in
1953. He
of Captain.
rank
the
Following
l955, where he attained
earned
his
D. degree
active military service, Mr. Coggan
from Southern Methodist University School of Law in Dallas,
Mr. Coggan graduated

then served

J.

graduation, he went into private practice and
became a partner with the Dallas law f irm of Bur f ord, Ryburn
and Ford in 1960 '

Texas.

NB-927

Upon

In 1963, he joined Smith Barney and Co. as a trainee
and investment broker in New York City and Dallas.
Mr.
Coggan left Smith Barney and Co. in 1967 and formed Lee
Coggan and Associates, LTD, a securities and investment

partnership.
He later founded Leland
Inc. , a real estate investment firm.

Coggan

Interests,

Mr. Coggan has been active in Republican politics.
He
has served as a Delegate to the Texas Republican State
Convention and as an Election Judge in his voting precinct in
Dallas. His work in various civic and church organizations

includes service as Executive Vice President
Theatre Center.

of the Dallas

a native of East St. Louis, Illinois, spent
his early years in St. Louis County, Missouri. He and his
wife, the former Patricia Conner of Oklahoma City, were
married in 1958. They have two children, Robert L. , a
minister in Ishpeming, Michigan, and Sharon Lee, a graduate
student at Carnegie Mellon University, Pittsburgh,
Mr. Coggan,

Pennsylvania.

ooo

In 1963, he joined Smith Barney and Co. as a trainee
and investment broker in New York City and Dallas.
Mr.
in
1967
Lee
left
Co.
and
formed
Smith
and
Coggan
Barney
Coggan and Associates, LTD, a securities and investment
partnership.
He later founded Leland Coggan Interests,
Inc. , a real estate investment firm.
Mr. Coggan has been active in Republican politics.
He
has served as a Delegate to the Texas Republican State
Convention and as an Election Judge in his voting precinct in
Dallas. His work in various civic and church organizations

includes service as Executive Vice President
Theatre Center.

of the Dallas

Mr. Coggan, a native of East St. Louis, Illinois, spent
his early years in St. Louis County, Missouri. He and his
wife, the former Patricia Conner of Oklahoma City, were
married in 1958. They have two children, Robert L. , a
minister in Ishpeming, Michigan, and Sharon Lee, a graduate
student at Carnegie Mellon University, Pittsburgh,

Pennsylvania.

oOo

RR

Oepartmeni of ihe Treasvry ~ Washlneton,
i

FOR RELEASE AT

August

D.C. ~ Telephone S66-204~

1 Oi ivII=1»tASUi~(

4:00 P. M.

CONTACT:

22, 1990

Office of Financing
202/376-4350

TREASURY TO AUCTION 2-YEAR AND 5-YEAR 2-MONTH
TOTALING $20, 000 MILLION

NOTES

The Treasury will raise about $10, 525 million of new cash
issuing $11, 500 million of 2-year notes and $8, 500 million
of 5-year 2-month notes. This offering will also refund $9, 465
million of 2-year notes maturing August 31, 1990. The $9, 465
million of maturing 2-year notes are those held by the public,
including $649 million currently held by Federal Reserve Banks
as agents for foreign and international monetary authorities.
by

The $20, 000 million is being offered to the public, and
any amounts tendered by Federal Reserve Banks as agents for
foreign and international monetary authorities will be added
to that amount. Tenders for such accounts will be accepted

at the average price of accepted competitive tenders.
In addition to the public holdings, Federal Reserve Banks
for their own accounts hold $1, 131 million of the maturing securities that may be refunded by issuing additional amounts of the
new notes at the average price of accepted competitive
tenders.
Details about each of the new securities are given in the
attached highlights of the offerings and in the official offering circulars.
oOo

Attachment

NB-928

Oepartment

of ihe Treasvry

~

Washlnston,
GEr'T.

FOR RELEASE AT

August

4:00 P. M.

Oi=

i

rIF

D.C. ~ Telephone 566-2D
I:.', EASUR, Y

CONTACT:

22, 1990

Office of Financing
202/376-4350

TREASURY TO AUCTION 2-YEAR AND 5-YEAR 2-MONTH
TOTALING $20, 000 MILLION

NOTES

The Treasury will raise about $10, 525 million of new cash
issuing $11, 500 million of 2-year notes and $8, 500 million
of 5-year 2-month notes. This offering will also refund $9, 465
million of 2-year notes maturing August 31, 1990. The $9, 465
million of maturing 2-year notes are those held by the public,
including $649 million currently held by Federal Reserve Banks
as agents for foreign and international monetary authorities.
by

The $20, 000 million is being offered to the public, and
any amounts tendered by Federal Reserve Banks as agents for
foreign and international monetary authorities will be added
to that amount. Tenders for such accounts will be accepted

at the average price of accepted competitive tenders.
In addition to the public holdings, Federal Reserve Banks
for their own accounts hold $1, 131 million of the maturing securities that may be refunded by issuing additional amounts of the
tenders.
new notes at the average price of accepted competitive
Details about each of the new securities are given in the
attached highlights of the offerings and in the official offering circulars.
oOo

Attachment

NB-928

HIGHLIGHTS OF TREASURY OFFERINGS TO THE PUBLIC
OF 2-YEAR AND 5-YEAR 2-MONTH NOTES

August

Offered to the Public

Amount

Descri tion of Securit

security

Term and type of
Series and CUSIP

designation

Issue Date
Maturity date
Interest Rate

yield
or discount
Interest payment dates
Investment

Premium

Terms
Method

availab le

denomination

Minimum

of Sale:
of sale

tenders

Noncompetitive
Accrued

interest payable

by investor
Pa ent Terms:
Payment by non-institutional

investors

0 ~

~

~

~

~

~

~

5-year 2-month notes

2-year notes

Series

AD-1992
(CUSIP No. 912827 ZF 2)
August 31, 1990
August 31, 1992
To be determined based on

~

~

~

~ ~

August

$5, 000

31, 1992

(CUSIP No. 912827

ZG

0)

September

$1, 000
Yield auction

Must be expressed as
an annual yield, with two
decimals, e. g. , 7. 104

Must be expressed as
an annual yield, with

Accepted in full at the average price up to $1, 000, 000

decimals, e. g. , 7. 104
Accepted in full at the average price up to $1, 000, 000

None

None

to be
with tender

Full payment

submitted

Acceptable

Receipt of tenders

Tuesday,

(final payment
due from institutions):
a) funds immediately
available to the Treasury
b) readily —collectible check

Series M-1995

4, 1990
November 15, 1995
To be determined based on
the average of accepted bids
the average of accepted bids
To be determined at auction
To be determined at auction
To be determined after auction To be determined after auction
February 28, 1991, August 31, May 15 and November 15 (first
payment on May 15, 1991)
1991, February 29, 1992, and

Deposit guarantee by
designated institutions

Settlement

$8, 500 million

$11, 500 million

Yield auction

tenders

Competitive

22, 1990

two

to be
with tender

Full payment
submitted

Acceptable
August

28, 1990,

prior to 1:00 p. m.

, EDST

Friday, August 31, 1990
Wednesday, August 29, 1990

Wednesday,

August

prior to 1:00 p. m.
Tuesday, September
Thursday. August

29, 1990,
, EDST

4, 1990

HIGHLIGHTS OF TREASURY OFFERINGS TO THE PUBLIC
OF 2-YEAR AND 5-YEAR 2-MONTH NOTES

August

Offered to the Public

Amount

Descri tion of Securit

Term and type of
Series and CUSIP

security

designation

Issue Date
Maturity date
Interest Rate

yield
Premium or discount
Interest payment dates
Investment

denomination

Minimum

Terms
Method

availabl

of Sale:
of sale

Competitive

Noncompetitive
Accrued

$11, 500 million

$8, 500 million

2-year notes

5-year 2-month notes

Series

AD-1992
(CUSIP No. 912827 ZF 2)
August 31, 1990
August 31, 1992
To be determined based on

August

$5, 000

31, 1992

yield,
decimals, e. g. ,
Accepted in full
age price up to
an annual

tenders

interest payable

by investor
Pa ent Terms:
Payment by non-institutional
investors

submitted

Receipt of tenders

Tuesday,

due from

payment

ZG

0)

as

with two
7. 104

at the aver$1, 000, 000

Yield auction
Must be expressed

yield,
decimals, e. g. ,
Accepted in full
age price up to
an annual

as

with two

7. 10%
at the aver$1, 000, 000

None

Full payment
Acceptable

(final

(CUSIP No. 912827

September

$1, 000

None

Deposit guarantee by
designated institutions

Settlement

Series M-1995

4, 1990
November 15, 1995
To be determined based on
the average of accepted bids
the average of accepted bids
To be determined at auction
To be determined at auction
To be determined after auction To be determined after auction
February 28, 1991, August 31, May 15 and November 15 (first
payment on May 15, 1991)
1991, February 29, 1992, and

Yield auction
Must be expressed

tenders

22, 1990

to be

with tender

to be
with tender

Full payment
submitted

Acceptable
August

28, 1990,

prior to 1:00 p. m.

, EDST

Wednesday,

August

prior to 1:00 p. m.

29, 1990,
, EDST

institutions):

a) funds immediately
available to the Treasury
check
b) readily-collectible

Friday, August 31, 1990
Wednesday, August 29, 1990

Tuesday, September 4, 1990
Thursday, August 30, 1990

UBLI
of the Treasury

Department

FOR IMMEDIATE

~

Bure~' of the 'Public Debt

RELEASE

l~';.

~ Washington,

LS'100( - Jd

f,

today.

The

DC 20239

for $10, 520 million of 52-week bills to
and to mature
August 29, 1991,
details are as follows:
BIDS:
Investment Rate
(E uivalent Coupon-Issue

be issued
were accepted

OF ACCEPTED COMPETITIVE

RANGE

Discount
Rate

7. 39o
7. 425o
7. 40~o

Low

High

Average

Tenders

at the

Yield)

7. 94%
7. 97%
7. 95~o

high discount

rate

were

allotted

Price
92. 528
92. 498
92. 518

48%.

TENDERS RECEIVED AND ACCEPTED

(In Thousands)

Location
Boston
New

York

Philadelphia
Cleveland
Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas Ci ty

Dallas
San Francisco
Treasury
TOTALS

~T~e
Competitive
Noncompetitive

Subtotal,

Public

Fed e ra 1 Res e rve

Foreign Official

Institutions
TOTALS

Acce ted
23, 975
9, 135, 970
14, 805

Received
23, 975
$
21, 235, 370
14, 805
20, 330
35, 410
16, 755
1, 976, 135
11, 075
6, 770
22, 915
6, 570
851, 235
255, 845
$24, 477, 190

$10, 519, 670

$20, 875, 760

6, 918, 240

$21, 487, 190
2, 700, 000

7, 529, 670
2, 700, 000

290, 000
$24, 477, 190

290, 000

611,430

20, 330
30, 810

16, 755

525, 135

11,075
6, 770

22, 915

6, 570

448, 715
255, 845

611, 430

$10, 519, 670

additional $90, 000 thousand of the bills will be issued
to foreign official institutions for new cash.
An

NB-929

+c,rc

t 23, 1990

i

30, 1990.

August

"e

Augus

~

~
~

RESULTS OF TREASURY'S 52-WEEK BILL AUCTION
e r
pf 0 f'f
I

Tenders

E

DEBT

e

~

I

~~

~gji sr'

LI DEBT E
Department

of the Treasury

~

RELEASE

FOR IMMEDIATE

6f'the 'Public Debt

Bure

&.

"~

T!I'-

Tic, .=i"."-'L""

'

for $10, 520 million of 52-week bills to
and to mature
August 30, 1990,
August 29, 1991,
today. The details are as follows:
Tenders

RANGE

BIDS:
Investment Rate
(E uivalent Coupon-Issue

be issued
were accepted

OF ACCEPTED COMPETITIVE

Discount
Rate
Low

High

Average—
Tenders

7. 39'
7 - 42~0
7. 40%

at the

Yield)

7. 94%
7. 97%
7. 95~o

high discount

rate

were

allotted

Price
92. 528
92. 498
92. 518

48-:.

TENDERS RECEIVED AND ACCEPTED

(In Thousands)

Location
Boston
New

York

Philadelphia
Cleveland
Richmond

Atlanta

Chicago
Louis
Minneapolis
Kansas Ci ty

St.

Dallas
San Francisco
Treasury
TOTALS

~T~e
Competitive
Noncompetitive

Subtotal, Public

Fede ra 1 Re se rve

Foreign Official
Inst, itutions
TOTALS

Acce ted
23, 975
9, 135, 970
14, 805

Received
23, 975
$
21, 235, 370
14, 805
20, 330
35, 410
16, 755
1, 976. 135
11,075
6, 770
22, 915
6, 570
851, 235
255, 845
$24, 477, 190

$10, 519, 670

$20, 875, 760

$

611, 430

20, 330
30, 810

16, 755

525, 135

11,075
6. 770

22, 915

6, 570

448, 715
255, 845

6, 918, 240

611,430

$21, 487, 190
2, 700, 000

7, 529, 670
2, 700, 000

290, 000
$24, 477, 190

290, 000

$10, 519, 670

additional $90, 000 thousand of the bills will be issued
to foreign official institutions for new cash.
An

NB-929

+rrc o+

23, 1990

August

RESULTS OF TREASURY'S 52-WEEK BILL AUCTION
'i&-PT QF

~

I
Ac

DC 20239

Washington,

.i&.JO02~ J8

~

KUWAZ

T/I

ZNFORYiATION

AUGUST

RAQ

PACKET

24, 1990

KUYAIT /IRAQ
INFORMATION
AUGUST

PACKET

24, 1990

DEPARTMENT OF THE TR&ASlJQY
wASkthtOTON

OFF' CZ OF FOR

ZGN

ASSETS CONTRO jr

KVRAZT ASS=T'S CONTROL REGULKTXONS
ENS T'

eti

Ce~

~

&»

~era &

haec

s. f'in~cial

ins itutions a-e authorized to
yerfonn and complete in accordance with its texas o
agreement with the Gove~en o Xuveit, to close out, offset,
- o» lieruidate,
ind~vidually or on a net basis, any contrac
vith or on behalf of the Government of Kuwait for (i) foreign
(a)

exchange,

without

U

cu™ency,and in-crest »ate ~sections (a&cludag,
l&itation, spa, fora%, op ion, svap, and futures

transact' ons), and (ii) comodi y option, map, andi futures
transactions (including &e pos in' or payment of harp& o»
set lemen varia ion vi& respect to rahsac=ions lese„ibed in
subparae

aphs

(i)

and

(ii) ),

p ovided the contract was entered

into prior to the e fective de e

is

recuirements

and any o

the folLowing

me-:
funds,

currency, sem~ ities, o» other assets
to the Govement of Kuwait a=e

to be paid or delivered
credited to a blocked account in Axe name o Me en ity of the
Government of Kuwait ~-ith which, or oh vhose behal, the
/

transaction

was

(2)

executed; or

Any

funds,

currency,

secur

ties, or other assets

to be paid or delivered o De Gove~ent of Ruveit are
credited to a bloc};ed or restricted account ih the naze of
in the

Government

o ' Kuwait

~esighated.

in the original

financial
paymen

institution

instactiohs

and

loca

or terms o„

US

QEPARTMENT OF THE TRPASgRg
WASHtk~N

OFFICE OF FOR ZG5 ASSETS

CONTROL
KURAZT ASS=T'S CONTROL RZGL~LATZONS
T EN@%

o

ti

Ce~: &~

r

~ra&

(a) U s. fin~cia~ ins i utions a-e authorized to
yerfom and complete in accordance wi& its texas or, in
agreement with the Qove~en
o Kuwait, to close out, offset,
-

liouidatc, individually
with or on behalf of &e

or

basis,

contrac
Government of Kuwait for (i) foreign
exchange, cu™ency,and in eres
ate ~sactions (m&cluda&g,
without lhaitation, spot, fora&, op ion, swap, and futures
transact' ons), and (ii) commodi y option, map, andi futures
transactions (includ~ng Re pos in' or payment of margin o»
settlemen
varia ion vi& respect to ransac=ions mesc ibed in
subpa aa aphs (i) and (ii)), p ovided the contract was ente=ed
into prior to the e fective da e and any o the following
o=

is

recuirements

on a net

any

met:

(1) Anv unds, currency, secu 5.ties, or other asse s
to be paid or aelivered to Ale Government of Kuwait are
cred. iteC to a bLoc):ed account in Axe name o De en ity of the
Government of Kuwait ~-i-h which, or on whose behalf,
I

transaction

was

executeC; or

to be paid or
credited to a
aoverrunen™

of

designa ed in

ency, securities,

or other assets
Celivered. o De Gove-nment of Kuwait are
blocked or res icted account in the name of the
Kuwai
in the '~ancial ins itu ion and loca ion
nst Oct ons or terms of
the original pagmen

Any

fl Dds

(

|.

Ol

08.

set

ma J

anent oz Qelive~ fo

~ which

FOkEI6~ &SSETS

~~~

+003

Pi

~hat conM~ct; provide& Ma

&e

settlame~, o= delivery occurs has
place an a angcment satisfactory to the pffice of Foreign
asets Control fo ense in' Za Qovaxnzen of Kuwait assets
'n such account are blocked or restricted; or
(3) All funds, cur icy, securities, or other asse s
du. c to the Government
o Kuwai
in connection with such
ansaction were pai& o= delive=ed to the Govement of Kuwai
prior to De ef ective date.
(b) All wansactions hy U. S. persons incidental to the
transactions authorizeP. in para@'raph (a) are also authorized.
(c) This license does no auRorire Ae cze6i ing of the
umiak, currency,
securities, or o2e asse s received by, or
for the henefi 0, 4&4 Gove=nhent 0 Kuwait in a transaction
auZoriaed 1n para~ph (a) ~o a bloc3ced account or sub
account fo= the Gove~en of Zuwa't under a..y name or
des dna on vt ich M~ e=s ro~ the nexe or designa ion o &e
specific blocked ac o"n or sub-account in wkich the assets
utilited by, or on behal of, Me Gove~en of Kuwait in such
country

payment,

~

transaction

vere held(d)

The followm~g

terms are

&engine&

as follows

of this license:
(1) The tern "Go&a~eat of Kuwait" includes
O
(A, ) The s ate and the Goveramer.
Kuwait, as
well as any political sM ivision, agency, o= inst~entalitz
hereof, including 2e Cent&1 San3c of Kuwait;
purposes

08. '2.

set

FOREIGN~

lement or cKelive~ fo

~hat

ASSETS

4003

~~~ F4

con~~et; provided tha

the

count~ m which payment, settlement, o delivery occurs has
place an a angement satisfacto~ to the Office of Foreign
~sets Control fo ensu in' Da Goveznmen of Kuwait assets
'n such account are blocked or restricted; or
(3) M1 funds, cur eacy, securi ies, or oWer asse s

to the

in connection with such
ansaction vere paid o= delive ed to the Gove~ent of
prior to &e ef ective date.
due

Government

o

Kuwait

by U. S. pe sons

Kuwai

Qcidental to the
transactions w}thorizeP. in pa agraph (a) are also authorixed.
(c) This license cioes not auDorixe Ae crediting of the
unds, currency, securities, oz oker asse s received by, or
for the benefi
4&e Gove~ent o Ku~~ t in a transaction
authorized Xn para~ph (a) ~o a bloc3ced account or subaccount fo= the Gove~en Of Zuwa't under L.}t name or
designation wj'ch d' ers =o- the name or d~signa ion of ~De
specific blocked accoun or sub-account in vkich Me assets
of Kuwait in such
Gove-nmen
utilired by, or on be."elf of, Me
I
transaction vere held(d) The followm~j terms are defied as fo13ovs for
purposes of this license(1) The tern "Gove~ent of Kuwait" includes
0 Kuwait, as
(A, ) The s-a"e and the Governmen
we11 as anv po3itical subCiviscoz, agency o= Mtrumentalitv
Qc eo f &c Odin+ the Cent&1 SKILL of Kuwait
(b)

Al3.

uansactions

0,

I

FOREIGN

.ASSETS

~-

PA

assoc' a-ion, corpora ion,
o oDe organization o~zed o con+oiled, by the foregoing;
(C) Any pe son to the ex en Rat such person
is, or has been, o to the ex en that dere is reasonable
cause to believe such pemon is, or has been, sMce the
effect've. date, ac ing or pu~o~ing o act, directly or
directly on behal. f o any o the oregoing, and
(B) Any par~e=ship,

(D) Any odxe

person detewined

by dxe

to he included video this sec ion.
(2) he tern "e fective d.ate". shalL. mean 5:00 a.m.
Eastern Dayt. ight Tme, Aucpxs 2, 1990.

Secre ary o the

T easury

tew "blocked accost" s..a11 mean an
account in a U. S. f'aancial 'asti u ion wit' respec to. vhich
accouni pavments, trans ers, vi &dravals, or o2e dealings
~~ay not be made o= e fec-ed„~cept pursuant
o an
auto ization cr 1'cense from he 0 fice of :-oreign Assets
Control auAoriz'ag such act'on.
(4) The iem "U. S. f ~~aancial lhst tution" shall
Lean any U. S. pe sc;. (including fo eign branches) Rat is
engaged in Me b~iness o accepting deposits or mWing,
gran ing, trans e~ing, holding, or brokering loans or
credits, or of pu~~chasirg o se1' in@ foreign exchange,
(3)

comxaodity

The.

fute ~es o= options,

sellers thereof, as

p ~acipal

or procuring

purchase

o= agent, -including,

s

and

but not

1~&ted +o, banks, savings banks, est co~panies, securiti es
b oke s and dealers, cozzodity futu es and op"ions b-okers and
==-=-;==-.

.:-«ct.

---==.:=-.

and

o=e gn exchange me chants

-

FORE IC'i &SSETS

Pc

(» &y pa&~+=«pi

associa Son, corpora ion,
o„oMe orcraniraiion o~~e5 o control. led. by the foregoing;
(C) My pe son to the eien
Oat such person
pz has been, o to the exient that Dere is reasonable
cause to believe such Pemon is, or has been, sMce the
effective -Cate, acting or puwo~iing to act, directly or
indirectly on behalf o any o the orcgoing, and
(D) My

Secre

any

of the
(2)

oMe

T casury

he tern

by Me

person determined

to he included

"e fect&ve

date".

this sec ion.
shall meth 5:00 a.m.
widxin

Eastern Daylight Tme, kugus 2, 1990.
(3) The. tern "blocked account" s. all

.

account in a U. S. fLaanc'al

trans„ers,

accouni payments,

zs« iution
w'

mean an

wi"' respect

or oZe

~&crawals,

to. which

dealings

.

o an
fec-ed„mcep pursuan
auto ization or l'cense rom he 0 fice of:-oreign assets
Cont o1 au Q5 iz 5Q such action.
(4) The iem "U. S. fLsanc~al ins ' utS. on" shall
mean any U. S. pe sc;. (including
fo cign branches) Mat is
en9'aged in the business o accepting deposits or ma3c. ng,
granting, trans erring, holding, or brokering loans or
credits, or of pl»chasing or selling foreign exchange,
utv es o= options, or procurimg purchase s and
commodity

not be

mav

made

o= e

~

sellers ihereof, as principal o= agent,
ted to banks, savings hanks, irust
b oke s and dealers, commodity Lu u es
&

~

—M and
~--- ————

-~

ncluding

co~.palies
and op

oreign exchange

g

but zlot

~

se~~iti es

ions brokers and
me

chants

securzt es and mxaoditi. es exchanges, clearing corporations,
vesMent ccepanies, employee benefit plans, and U. S. holding
companies, U. 8 af filka es, or U. S. subsidiaries o any of De
~

foreg oi?lf .
Xssu. ed:

R. Richard

Aucpxs-

13,

Xc'90

Newcomb

ector
0 ice of Foreign Asse s

Di

ControL

FiJRZ

securities
+ompanies

ities

clearing corporations
companies, employee baaefit plans, and U. 8- hol. ~in'
o an7 oi
U S cf f ilia es, or U. S. suhsiCiaries
and. eazaod.

exchanges,

~

goregoing.

Xssu. eC:

R. Richard.

Accus

i 13,

1990

Newcomb

ector
0 ice of Foreign Asse~s Control

Di

~ UU5

j(.'i .&&iiT. S

~

08

''

ASSETS

FOREIGN

~~~ Pa

Moue

AUG15 1990
DEPART'MENT QF THE TREASURY
WHISK(NCTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT LS S TS CO~OL REGULLTZONS

E~

'ca

elecommu

ns ~a

S~

transactions of U. S. common carriers with
respect to the receipt anC transmission of telecommunications involv&g Kuwait and Iraq a e au&orizeC, provided any
owens to &e Government
patman
of Kuwait, the Gove nmen of
Iraq, or persons in Kuwait or Iraq is paiC into a blocked
account m a Q. S. bank.
(b) Te~ used in this license are defined as follows:
(1) The term "Gove~ient of Kuwait" shall mean
a) The state anC he Government of Kuwait, or any
(a)

KL3.

ity pu~oztmg to be Me Government o Kuwait, as we11 as
any political sub'. ivision, agency, or wstrumen ality

en

~hereof, include.
b)

Any

in'

Me

cental

SaM of Kuwait;

pa~nersh& p, association,

corpora ion, 9

or controlled by the oregoizxg;
c) Any pe=son to the ex en tha- such pe son is, or
has bee , or to ~we exigent Rat ~&ere is reasonable cause to
believe such person ~s, or has been, s'-.ce Ae effective
Cate, ac ing or pu~orting to act, direc41y or inCirectly on
othe

organization

owneC

/

/

behalf of any o

Axe

foregoing,

P

and

oDer pe son o orgarZzation dete QineC
the Secreta~ of the Treasury to be included w- ~in
section
(2) The erm "Gove~ent of iraq" shall mean
d) Any

by

0

II IIII IIII

InII I
E%

I

Inly
C3 L9'

I)
421

I Ilj

I

I'

v

FOREIG~ ASSETS

~~~

4006

PA

AU G

15 1990

DEFARYMENY OF THE TREASURY
WASIEtNGTON

OFFICE OS romZm ASSETS CONSOL
ASS TS CO~~ OL RZGULLTZONS

RUWAZT

ENERGY

ca

Telecommu

ns &a

Q.l transactions of 'V. S common carriers with
respect to the receipt and tmsmission of telecomzuunications involving Kuwait and Iraq a e av. Qorized, provided any
owed to Me Govem~ent of Kuwait, the Governmen
paymen
of
Iran, or persons in Kuwait or Izing is paid into a blocked
account m a Q. S. bank.
(b) Te~ used in this license are defined as follows:
(1) The term Government of Kuwait" shall mean
a) The state and. the Government of Kuwait, or any
(a)

ity purporting to be Ze Govenmen o Kuwait, as well as
ality
ardency, or instrumen
any polit: cal subdivision,
~hereof, m&eluding ~e cental Sa& of Kuwait;

en

p, association, corpora ion, o
othe organization owned or can rolled by the oregoing;
c) ~y pe=son o the ex en that such pe son is, or
has bee , or to the extent that ~&ere is reasonable cause to
b)

Any pa~~nezsh~

believe such pe son is, or has bean, s'-.ce the ef ective
date, ac inp or purporting to act, directly or indirectly
behalf of any o Me foregoing, and
/

I

/

8) key oDer pe son o organza ion dete~ined
the $ecreta~ of the Treasury to he included wi~in

section
(2) The

erm

"Gove~ent of Zraq" shall

mean

by

on

a) The state and the Government

of Iraq, as veil as

political subdivision, agency, or instrumentality
thereof, including the Cental Sank of XraZr
any

association, corporation, or
owned or controlled by the foregoing;
othe organization
c) Any person to dxe extent that such person is, or
has been, or to Ze extent that there Is. reasonable cause to
believe such person Is, or has been, since the effective
date, acting or purporting to act, directly or McLizectly on
behalf of any of the foregoing, and
d) Any other person or oraanitation Cetezx~ed by
the Secretary o the Treasury to be Included vithin this
section.
(3) The term "blocked accost" shall mean an acc, ount
with respect to wMch account payments, ~~ans ers o
withdrawa3. s or other dealings may not be made or effec ed
except pursuant to an auporixation or license from the
of ice of Foreign Assew Consol authorizing such act'on.
(4) The te~ "telecowwunica ions" shall mean telephone,
tel. ex, and telegraph ~smissions, and transmissions for
b) &ay partnership,

purposes.

nevsgathering
Zssued:

.a

August

/
R- Richard

ZS, ~Iso

z

Hewcomb

Director
Office of Foreign Assets Control

.

FOREIGN

221

hSSETS

a) The state and the Government

@007

~+~ P4

of'

Iraq, as mell as

political subdivision, agency, or instrumentality
thereof, including the Cental Bank of Iraqi
any

association, corporation, or
othe organization
owned or controlled hy the foregoing;
c) any person to the extent that such person is or
has been, or to the extent that &ere is. reasonable cause to
believe such person is, or has been, since the effective
Cate, acting or purporting to act, dizectly or inMectly on
behalf of any of the foregoing, and
C) Any other pe son or ozganisation deters~ed by
the Secretary o the Treasury to be included within this
section.
(3) The term "blocked accost" shall mean an account
with respect to wMch accoun payments, ~~ansfez;s o
vithdram3. s or othe dealings may not be made oz effec ed
except pursuant to an augorisation 07 license from the
of ice of Foreign Assets Consol authorizing such act'on.
h) Pay partnership,

(4 )

telex,
new

The
and.

R. Richard

tele coMunications"

m

telegraph

Weathering

Issued:

te

~smissions,

purp os es

August

ZS,

Yevcomh

Z. SSO

Director
Office of Foreign Assets Contxol

and

sha 1l mean telephone,

transmissions

for

08-'

FOREIGN'~

hSSETS

~~i

@008

F&

DEPARTMENT QF THE TREASURY
WASNIN4TON

OFFICE QF FOREEGN ASSETS CONTROL
KUWAZT kSSZTS CONTROL REGUIJLTZONS
ZRAQI SRXCTEONS REGVZATEONS
EÃ8

cht

o Era

02

or

c s

ods

the

w

Ive

Gove

Specific licenses my he issued

(a)

a

a case-by-case
basis to peart payment, from a blocked account or otharvise,
of amounts owed to or for the benefit of a U. S. person for
goods or services acported hy a U. S. person or from the United
States prior to the effective date directly or indirectly to
on

or Kuwait, or to th1rd countries for the benefit of the
Government of Zracr or the Govtnuaent of Kuwait, where the
exporter's license application presents evidence satisfactory
to the Office of Foreign Assets Control that:
(3.) the expo~tion occurred prior to the effective
Zrac[

date (such evidence
waybill,

'

may

include,

g.g. , hill of lading, air

the p~~chaser's writ~n confirmation

of completed

sexvices, customs documents, insurance documents), and
(2) if delivery or performance occurred after the
effective date, due diligence was exercised to divert delivery
of the goods from Zrac or Kuwait and to effec final delivery
of the goods to a non-prohibited destination, or to prevent
performance of the services.
(b)

This section does not authorIze

exportations

or the

of services after the effective date pursuant to a
contract entered into or partially performed prior to the
effective date.
performance

08-' 24

FOREIGN'~

hSSETS

~~~

4l 008

PA

DEPARTMENT OF THE TREASURY
WASNINOTON

OFFICE QF FOREEGN ASSETS CONTROL
KUWAZT kSSZTS CONTROL REGENT ZONS
ZRAQZ

ent

o Era

o

Ods

or

(a)

w

SkNCTEONS REGENT ATZONS
CEÃ$

cs
the Gave

Specific licenses

may

ive

a

he issued on a case-by-case

basis to pexmit payment, from a blocked account or otherwise,
of amounts owed to or for the benefit of a U. S. person for
goods ar services «xported by a U. S. person or from the United
States prior to the effective date directly or indirectly to
?rag ar Kuwait, or to third countries for the benefit of the
Government of Zraer or the Government of Kuwait, where the
exporter's license application presents evidence satisfactory
to the Office of Foreign Assets Control that:
(I,) the expo~tian occurred prior ta the effective
date (such evidence may include, g. g. , bill of Lading, air
waybill, the purchaser's wri46sn confirmation of completed
sexvices, customs documents,

insurance

documents),

and

if

delivery ar performance occurred after the
effective date, due diLigence was exercised to divert delivery
of the goods from Xrac or Kuwait and to effec final delivery
of the goods ta a non-prohibited destination, or to prevent
(2)

performance

(b)

of the services.
This section does not authorIze

exportations

or the

of services aft«r the effective date pursuant to a
contact entexed inta or partially performed priox' to the
effective date.

perfonnance

08. '24

FOREIG~ ASSETS

««« P&

40O9

(c) Transactions conducted under specific licenses
granted pursuant to this section must be reported in writing to
the Office of P'oreign Assets control, Bloc3ced Assets Section
within ten (10) clays of the date of payment.
(d)

Separate criteria

licenses authorizing

may

payment

be applieC to the issuance of

from an account held M a blocked

U. S. bank.

in this license are defined as follows:
(1) The term "U.S. person" shall mean any United
States citizen, permanent resident alien, guridf. cal person
orcranized under the laws of the United States (including
foreign branches), or any person in the United States, and
vessels of U. S. registration.
(2) The term "effective Cate" shall mean (A) 5:00
a-m- Eastern Daylight Time, august 2, 1990, in the case of
exportations to or for the benefit of the Government of Iraq or
(e)

Terms used

of Kuwait; or (B) 8:55 p. m. Eastern Daylight
Time, August 9, 1SSO, in the case of exportations to Iraq or
business in a third country
Kuwait, oz to a non-governmental
the Government

operated from Iraq or Ruwait;.

of Iraq" shall mean
a) The state and the Government of Iraq, as well as
political subdivision, agency, or instrumentality thereo f,
including the Central Bank of Iraq;
(3) The term

Government

any

FOREIGN ASSETS

F&

(c) Transactions conducted under specific licenses
granted pursuant to this section must be reported in writing to
the Office of Foreign 2hssets Control, Blocked assets Section
within ten (10) Cays of the date of payment.
(d)

Separate

criteria

licenses authorizing

may

payment

be applieC to the issuance of

from an account held

in a blocked

U. ST bank.

in this license are defined as follows:
(1) The tean "U.S. person" shall mean any United
States citizen, permanent resident alien, f uridical person
organized unCer the laws of the United States (Deluding
foreign branches), or any person in the United States, and
vessels of U. S. registration.
(2) The term "effective Cate" shall mean (A) 5:00
a-m. Eastern Daylight Time, august 2, 1990, in the case of
exportations to or for the benefit of the Government of Iraq or
the Government of Kuwait; or (B) 8:55 p. m. Eastern Daylight
Time, 2bxgust 9, 1990, in the case of exportations to Iraq or
business in a thfrC country
Kuwait, or to a non-governmental
(e)

Terms used

operated from Iraq or Kuwait.

;

of Iraq" shall mean
a) The state and the. Government of Iraq, as well as
political subdivision, agency, or instrumentality thereof,
including the Central Sazdc of Iraq;
(3) The term

Government

any

. :.- -

06 .

-.-

-

=;:=:::
'21

FOREIG~ ASSETS

association,

h) Any partnership,

organization

4 010

~~~ P&

corporation,

or other

or controlled. by the foregoing;
c) Any person to the arrant that such person is, or has
been, or to the extent that there is reasonable cause to
believe such person is, or has bean, since the effective date,
acting or purporting to act, directly or &~ectly on behalf
of any of the foregoing, and
owned

or organization determined by the
Secretary of the Treasury to be included vithin this section.
(4) The term "Goverrzment of Kuvait" sha11 mean
a) The state and the Government of Kuvait, any entity
purporting to be the Ooveznment of Kuwait, as dwell as any
political subdivision agency, or instrumentality thereof,
including the Central Bank of Kuwaits
association, corporation or other
b) Any partnership,
o-ganization owned or controlled. by the foregoing;
c) Any person to the' extent that such person is, or has
been, or to the extent that there is reasonable cause to
believe such person is, or has bean, since the effective date,
acting or purporting to act, directly or &directly on behalf
d) Any other pezson

of

any

of the foregoing,

and

d) Any other person 'or organization

determined

by the

Secretary of the Treasury to be included within this section
(5) The term "blocked. account" shall mean an account
in a V. S. financial institution with respect to which account
paymen ts transfers or w9. thdrawals or other dealings may not be
or 3.icense
made oz effected except pursuant to an authorization

p~nership,

association, corporation, or other
organization owned or controlled hy the foregoing;
c) Any person to the
that such person is& or
been, or to the extent that there is reasonable cause to
believe such person is, or has been since the effective date,
acting or purporting to act, directly or indirectly on behalf
of any of the foregoizxg, azure
d) Any other person or organization determined by the
Secretary of the Treasury to be included within this section.
(4) The term "Goverrzment of Kuwait" shall mean
a) The state and the Government of Kuwait, any entity
purporting to be the Government of Ruvait, as veil as any
political subdivision agency, or Izmtrumentality thereof,
including the Central Bank of Xuwaits
association, corporation, or other
b) Any partnership
oganization owned or controlled by the foregoing;
c) Any person to the' extent that such person is, or has
been, or to the extent that there is reasonable cause to
beljeve such person is, or has been, since the effective a[ate,
acting or purportLag to act, directly or Md~ectly on behalf
b)

Any

arts

»

4

of

any

of the foregoing,

and

other person 'or organization determined by the
Secretary of the Treasury to be included within this sectjon.
(5) The term "blocked account" shall mean an account
d, ) Any

institutIon wIth respect to vhich account
payments, transfers or withdrawals or other dealings may not be
or license
made or effected except pursuant to an authorization
in a U. S. financial

FOREIGN

from the

aSSETS

~

F4

Office of Foreign Assets Control authorizing

such

action.
(6) The term ~exportation" sha11 mean (A) ~e actual
departure of pools from the territorial Jurisdiction of the
country from vhich exporters, or (8) the performance hY a U-Sperson of services that are &tenders to result in a benefit to

the

of Trap, the

Government

Ezaq or Kuwait,

Issued,

:

or

August

an

Government

of Kuwait, a person w

entity operateC from ?zan or Kuwait.

15, 1990

R. Richard. Newcomb
Director
Office of Foreign Assets Control

FOREIG~ ASSETS

from the

~~~ F4

Office of Foreign Assets Control authorizing

such

action.
(6) The term ~exportation" sha11 mean (A) the actual
departure of g'oops from the territoria1 Jurisdiction of the
country from ~hich exporters, or (8) the performance hy a U-s.
person of services that are ixxtenfel to result Qx a benefit to
the. Government of Xraq[, the Government of Kuwait, a parson Xn

iraq or Kuwait, or
ZssueC:

August

an

entity operateC

15, 1990

R. Richard. Newccaab
Director
Office of Foreign Assets Consol

from

Iraq or

Kuwait.

t.

08-'24

V (

~

~

A Q

FOREIGN~

J

ASSETS

i~~

Ph

DEPARTMENT OF THE TREASURY
WASHLNCTDN

OFFICE OF FORKZGN ASSETS CONTROL
KVGLZTZ ASSETS CONTROL REGU'LOTIONS
IRAQZ SAN CTZONS REG'ULATZONS

ce

Re
2Q.

1 transactions

transfers ta

S

ZC

G

common

hy U.

s.

persons Mcluding payment

and

cILrriers incident to the receipt or

of mail between the UniteCl States md Kuwait and
between the U'&ted States ant Iran are authorized, provided
mail is lizdted to items not exceeding twelve (3.2) ounces.
transmission

Zssued:

August

23

1890

I

R. Richard
Director
Of f ice o

f

Newcomer

Foreign Assets Control

"'v''i'

08-'

'i"
~

u

m

1

FOREIGN ASSETS

i

Ph

DEPARTMENT OF THE TREASURY
WASH IN CTQ N

OFPZ CE QF FOREIGN ASSETS CONTROL

~QLZTZ ASSETS
ZRAQZ

8

CONTROL REGU'LOTIONS
REGULA TZONS

SANCTIONS

IC

8

ce

Re

k11 transactions hy U. s. persons including payment and
transfers to common carriers incident to the receipt or
transmission of mail hetveen the Unite@ States and Kuwait and
between the 7&ted States ant Xrag are authorized, provided
mail is lizd. teak to items not exceeding tvelve (12) ounces.

Issuel:

I

August

I

23, l.990

/

R. Richard Newcomer
Director
Office of Foreign Assets control

portmen of the 7reasurl

FOR IMMEDIATE

September

~

RELEASE

14, 1990

Nashlnyion,

D.C. a Telephone SSS-204f

Contact: Desiree Tucker-Sorini
202-566-8773

STATEMENT BY THE SECRETARY
OF THE TREASURY
NICHOLAS F. BRADY

are pleased that the Government of Japan has. come
contribution to the multinational
effort to counter the effect of Iraqi aggression in Kuwait. This
contribution will help address the immediate needs of the frontline states and assist in the defense of Saudi Arabia.
We

forward

NB-942

with a significant

CIrtment

of the

TrecisMry ~ Woshlnyton,

FOR IMMEDIATE

September

p. g. a Telephone 566-204

Contact: Desiree Tucker-Sorini
202-566-8773

RELEASE

14, 1990

STATEMENT BY THE SECRETARY
OF THE TREASURY
NICHOLAS
BRADY

F.

are pleased that the Government of Japan has come
with a significant contribution to the multinational
effort to counter the effect of Iraqi aggression in Kuwait. This
contribution will help address the immediate needs of the frontline states and assist in the defense of Saudi Arabia.
We

forward

NB-942

Removal Notice
The item identified below has been removed in accordance with FRASER's policy on handling
sensitive information in digitization projects due to copyright protections.

Citation Information
Document Type: Transcript

Number of Pages Removed: 16

Author(s):
Title:

ABC "Good Morning America" Interview with Nicholas Brady, Treasury Secretary

Date:

1990-09-10

Journal:

Volume:
Page(s):
URL:

Federal Reserve Bank of St. Louis

https://fraser.stlouisfed.org

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAITI ASSETS CONTROL REGULATIONS
IRAQI SANCTIONS REGULATIONS
GENERAL

Im

ortation of Household
The

importation

use, of

or indirectly

a

including

arriving

person

from Iraq or Kuwait

ef fects

included

in such

provided

they were actually

are not intended
otherwise

for

prohibited

any

may

Effects

from

and

in the United

is authorized.

be imported

Ira

or Kuwait.

effects of
articles for
States directly

personal

and

baggage

without

used by such person

Articles
limitation
or family

abroad,

other person or for sale, and are not

from importation.

/

Issued:

R. Richard

Personal

of the household

Iraqi or Kuwaiti origin,
family

and

11

LICENSE NO.

zrrz

Newcomb

Director

Office of Foreign Assets Control

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAITI ASSETS CONTROL REGULATIONS
REGULATIONS

IRAQI SANCTIONS
GENERAL

Im

ortation of Household
The

importation

use, of

or indirectly

a person

including

arriving

from Iraq or Kuwait

effects

included

in such

provided

they were actually

are not intended
otherwise

Personal

of the household

Iraqi or Kuwaiti origin,
family

and

for

prohibited

any

may

Effects

from

and

in the United

is authorized.

be imported

Ira

or Kuwait.

effects of
articles for
States directly

personal

and

baggage

without

used by such person

Articles
limitation
or family

abroad,

other person or for sale, and are not

from importation.

Issued.

R. Richard

ll

LICENSE NO.

Newcomb

Director

Office of Foreign Assets Control

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

other person or organization

Secretary of the Treasury to be included

by the

within this section.

"deferred payment" shall mean a
payment to be made under a letter of credit at a maturity
date specified by or determinable from the wording of the
credit, but not involving the acceptance of a tenor draft,
and is as used in the Uniform Customs and Practice for
(3)

Documentary

Issued:

R. Richard

The term

Credits, 1983 Revision,
August

30, 1990

ewcomb

ector
Office of Foreign Assets Control
Di

ICC

Publication

No.

400.

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

by

other person or organization

the Secretary of the Treasury to be included
'F

within

this section.
(3)

payment

to be

"deferred payment" shall mean a
under a letter of credit at a maturity
or determinable from the wording of the

The term
made

date specified by
credit, but not involving
and

is as

Documentary

Issued:

the acceptance of a tenor draft,

used in the Uniform

Customs

Credits, 1983 Revision,
August

30, 1990
i

R. Richard

ewcomb

ector
Office of Foreign Assets Control
Di

and

ICC

Practice for

Publication

No.

400.

(1)

(A) The

well as any

of Iraq" shall mean:
the Government of Iraq, as

The term "Government

state

and

political subdivision,

instrumentality

agency,

the Central Bank of Iraq;

thereof, including
(B)

Any

association,
substantially

partnership,

corporation, or other organization
controlled by the foregoing;
(C) Any person

is,

or

or

to the extent that such person

or has been, or to the extent that there

cause to believe such person

owned

is,

is

reasonable

or has been, since the

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

within

by

other person or organization

the Secretary of the Treasury to be included

this section.
(2) The term "Government
(A) The

any

entity purporting

well as any

state and the Government of Kuwait or
to be the Government of Kuwait, as

political subdivision,

instrumentality

of Kuwait" shall mean:

thereof, including

or
the Central Bank of
agency,

Kuwait;

(B)

Any

partnership,

corporation, or other organization
controlled by the foregoing;
(C) Any person

is,

association,
substantially

to the extent that

owned

or

such person

or has been, or to the extent that there is', reasonable
cause to believe such person is, or has been, since the

(1)

(A) The

well as any

of Iraq" shall mean:
the Government of Iraq, as

The term "Government

state

and

political subdivision,

agency,

the Central Bank of Iraq;

thereof, including

instrumentality

(B)

Any

association,
substantially

partnership,

corporation, or other organization
controlled by the foregoing;
(C) Any person

is,

or

or

to the extent that such person

or has been, or to the extent that there

cause to believe such person

owned

is,

is

reasonable

or has been, since the

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

within

by

other person or organization

the Secretary of the Treasury to be included

this section.
(2) The term "Government of Kuwait" shall mean:
of Kuwait or
(A) The state and the Government

any

entity purporting

well as any

to

political subdivision,

instrumentality

of Kuwait, as
agency, or
the Central Bank of

be the Government

thereof, including

Kuwait;

(B)

Any

partnership,

corporation, or other organization
controlled by the foregoing;

association,
substantially

owned

or

to the extent that such person
is, or has been, or to the extent that there is', reasonable
cause to believe such person is, or has been, since the
(C) Any person

portment of the Treasury ~ Washlnyion,

FOR IMMEDIATE RELEASE

October 4, 1990

THE DEPARTMENT

O.C. ~ Telephone 581-204'

Contact: Desiree Tucker-Sorini
Cheryl Crispen

(202)566-8773
(202)566-5252

OF THE TREASURY RELEASES LIST CLARIFYING
9$' KUWAITI BANKS AND COMPANIES.

STATUS OF

--

The Treasury Department today released a list
the status of 9f Kuwaiti banks and companies under the
Executive Orders issued by the President when he froze assets
belonging to the Governments of Kuwait and Iraq on August 2, 1990.

Washington,

clarifying

The

list

D. C.

divides the Kuvaiti entities

into three categories:
"Controlled/Blocked, " which means they are controlled by the
Government of Kuwait and/or the Government of Iraq and their
assets are frozen;
"Controlled/Licensed
to Operate, " which means they are
controlled by the legitimate Government of Kuwait and have
been licensed by the Treasury Department to operate;
"Not Controlled/No
Restrictions, " which means they
regarded by the Treasury Department as controlled

are not
by the
This catego y

Government of Kuwait or the Government of Iraq.
was included solely for the purpose of clarification

has received

the Treasury Department
the status of those particular

many

entities.

requests

the list
significant information becomes available. Additions
affecting all three categories are anticipated.

The

Treasury

Department

will

update

oOo

Attachment

NB-976

because
concerning

or
or revisions

when

new

apartment of the Treasury ~ Nashlniion,

FOR IMMEDIATE RELEASE

October 4, 1990

THE DEPARTMENT

O.c. ~ Telephone

Contact: Desiree Tucker-Sorini
Cheryl Crispen

(202)566-8773
(202)566-5252

OF THE TREASURY RELEASES LIST CLARIFYING
9$' KUWAITI BANKS AND COMPANIES.

--

III-204~

STATUS OF

Department today released a list
clarifying the status of 9f'Kuwaiti banks and companies under the
Executive Orders issued by the President when he froze assets
belonging to the Governments of Kuwait and Iraq on August 2, 1990.

Washington,

list

D. C.

The Treasury

divides the Kuwaiti entities

into three categories:
"Controlled/Blocked, " which means they are controlled by the
Government of Kuwait and/or the Government of Iraq and their
assets are frozen;
"Controlled/Licensed
to Operate, " which means they are
controlled by the legitimate Government of Kuwait and have
been licensed by the Treasury Department to operate;
"Not Controlled/No
Restrictions, " which means they are not
regarded by the Treasury Department as controlled by the
Government of Kuwait or the Government of Iraq= This catego y
was included solely for the purpose of clarification because
the Treasury Department has received many requests concerning
the status of those particular entities.
will update the list when new or
Department
The Treasury
significant information becomes available. Additions or revisions
affecting all three categories are anticipated.

The

oOo

Attachment

NB-976

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
ASSETS CONTROL REGULATIONS
General Notice No. 1

KUWAITI

NOTIFICATION

OF STATUS OF KUWAITI

(10/04/90)

ENTITIES

The Treasury Department has been asked about the status of
various entities in which Kuwait or Kuwaiti nationals may have an
interest for purposes of Executive Order Nos. 12722-12725. Based
on information
currently available to the Office of Foreign
Assets Control, the following lists have been compiled.

The

to

entities listed as "Controlled/Blocked"

be controlled

by

the Government

have been determined

of Kuwait and/or the

of Iraq and should be regarded as blocked entities.
U. S. persons are prohibited from engaging in
transactions with these entities and all assets under U. S.
jurisdiction owned or controlled by those entities are blocked.
however, from paying funds owed
U. S. persons are not prohibited,
to these entities into blocked accounts held in U. S. financial
Government
This means

institutions.
to Operate" should
The entities listed as "Controlled/Licensed
also be regarded as controlled by the Government of Kuwait, but
as licensed to operate. This means the Office of Foreign Assets
Control has determined that the entities are under the effective
control of the legitimate Government of Kuwait and U. S. persons
are authorized to engage in transactions with them. These
authorized transactions include entering into contracts, making
and conducting other commercial or
and receiving payments,
If questions arise, U. S. financial and
financial transactions.
should request, from the entities
commercial institutions
concerned, to see copies of the operating licenses.
Restrictions" are not
The entities listed as "Not Controlled/No
Assets
Control
of
Foreign
as controlled by
Office
the
regarded by
the Government of Kuwait or the Government of Iraq. The names of
these entities appear on the list solely for the purpose of

Page 1 of 5

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAITI ASSETS CONTROL REGULATIONS
General Notice No. 1

NOTIFICATION

OF STATUS OF KUWAITI

(10/04/90)

ENTITIES

The Treasury Department has been asked about the status of
various entities in which Kuwait or Kuwaiti nationals may have an
interest for purposes of Executive Order Nos. 12722-12725. Based
on information
currently available to the Office of Foreign
Assets Control, the following lists have been compiled.

The

to

entities listed as "Controlled/Blocked"

have been determined
Kuwait and/or the

the Government of
and should be regarded as blocked entities.
U. S. persons are prohibited from engaging in
transactions with these entities and all assets under U. S.
jurisdiction owned or controlled by those entities are blocked.
U. S . persons are not prohibited,
however, from paying funds owed
to these entities into blocked accounts held in U. S. financial
be controlled

Government
This means

by

of Iraq

institutions.
to Operate" should
The entities listed as "Controlled/Licensed
also be regarded as controlled by the Government of Kuwait, but
as licensed to operate. This means the Office of Foreign Assets
Control has determined that the entities are under the effective
control of the legitimate Government of Kuwait and U. S. persons
are authorized to engage in transactions with them. These
authorized transactions include entering into contracts, making
and conducting other commercial or
and receiving payments,
transactions.
If questions arise, U. S. financial and
financial
should request, from the entities
commercial institutions
concerned, to see copies of the operating licenses.
Restrictions" are not
The entities listed as "Not Controlled/No
regarded by the Office of Foreign Assets Control as controlled by
the Government of Kuwait or the Government of Iraq. The names of
these entities appear on the list solely for the purpose of

Page 1 of 5

clarification because requests regarding their status have been
received. Some of the entities on this list may be subject to
special Treasury Department

*t

t'

licensing/reporting

tj

t

'

'

requirements.

t

td

Additions to
information become available and are not inclusive.
the lists are anticipated.
The absence of a particular entity on
any of the lists should not be regarded as indicative of whether
the entity is owned or controlled by the Government of Kuwait or
the Government of Iraq.

For further information concerning this notice contact the Office
of Foreign Assets Control at (202) 566-2701.

Issued:

October 4, 1990

R. Richard

Newcomb

Director
Office of Foreign Assets Control

Page 2

of

5

clarification because requests regarding their status have been
received. Some of the entities on this list may be subject to
special Treasury Department
*h

i'

requirements.

licensing/reporting
'

b)

'

h

1d

Additions to
information become available and are not inclusive.
entity on
are
of
a
particular
anticipated.
absence
The
the lists
any of the lists should not be regarded as indicative of whether
the entity is owned or controlled by the Government of Kuwait or
the Government of Iraq.

For further information concerning this notice contact the Office
of Foreign Assets Control at (202) 566-2701.

Issued:

October 4, 1990

R. Richard

Newcomb

Director
Office of Foreign Assets Control

Page

2

of

5

OFFICE OF FOREIGN ASSETS

CONTROL

Status of Kuwaiti Entities
10/04/90

Controlled

Blocked

A1Ahli Bank of Kuwait
A1Ahlia Insurance Company
Arab Fund for Economic and Social Development
Arab Trust Company
Bahrain Arab International Bank
Bank of Kuwait & Middle East
Burgan Bank
Central Bank of Kuwait
Commercial Bank of Kuwait
Commercial Facilities Company

Gulf Insurance

Company

Industrial Bank of Kuwait
International Financial Advisor

Finance House
KREIC Singapore
Kuwait Cement Company
Kuwait

Kuwait
Kuwait
Kuwait
Kuwait
Kuwait
Kuwait
Kuwait
Kuwait

Clearing Company
Hotels Company
Metal Pipe Industries
Real Estate Bank
Real Estate Investment
Reinsurance Company

Company

Consortium

Supply Company
United Poultry Company
Mobile Telephone Systems
Mubarakiah Poultry and Feed Company
National Industries Company K. S. C.
National Real Estate Company

Public Warehousing Company
Rawdatain Water Bottling Company

Industries

Refrigeration

Savings and Credit Bank

Company

Securities Group Company
Securities House Company
The Gulf Bank
United Fisheries of Kuwait
United Realty Company
Univest Invest Company
Warba

Insurance

Company

Page 3 of 5

(KREIC)

OFFICE OF FOREIGN ASSETS

CONTROL

Status of Kuwaiti Entities
10/04/90

Controlled

Blocked

A1Ahli Bank of Kuwait
A1Ahlia Insurance Company
Arab Fund for Economic and Social Develop ment
Arab Trust Company
Bahrain Arab International Bank
Bank of Kuwait & Middle East
Burgan Bank
Central Bank of Kuwait
Commercial Bank of Kuwait
Commercial Facilities Company
Gulf Insurance Company
Industrial Bank of Kuwait
International Financial Advisor
Kuwait Finance House
KREIC Singapore
Kuwait Cement Company

Kuwait
Kuwait
Kuwait
Kuwait
Kuwait
Kuwait
Kuwait
Kuwait

Clearing Company
Hotels Company
Metal Pipe Industries
Real Estate Bank
Real Estate Investment
Reinsurance Company

Company

Consortium

Supply Company
United Poultry Company
Mobile Telephone Systems
Mubarakiah Poultry and Feed Company
National Industries Company K. S. C.
National Real Estate Company

Public Warehousing Company
Rawdatain Water Bottling Company
Refrigeration Industries Company
Savings and Credit Bank

Securities Group Company
Securities House Company
The Gulf Bank
United Fisheries of Kuwait
United Realty Company
Univest Invest Company

Warba

Insurance

Company

Page 3 of 5

(KREIC)

OFFICE OF FOREIGN ASSETS

CONTROL

Status of Kuwaiti Entities
10/04/90

Licensed to 0 crate

Controlled

Credit des Bergues
Industries, Inc. (including
subsidiaries)
KFIC, Inc. (including subsidiaries)
Georgetown

Kuwait Airways Corporation
Kuwait Asia Bank
Kuwait Investment Office (including

controlled

entities)

Kuwait Investment Authority
Kuwait Maritime Transport Company
Kuwait & Middle East Financial Investment Company
Kuwait Oil Tanker Company
Kuwait Petroleum Corporation (London) (including

licensed affiliates)

Kuwait

— North

Petroleum

Sea Holdings

(including subsidiaries)
Santa Fe International Corporation

affiliates)
Corporation (Cayman)
and affiliates)

subsidiaries
Wafra Intervest
subsidiaries

and

Not Controlled

Restrictions

No

Ltd.

(including
(including

*

Alexandria Kuwait International Bank
Bank
Arab African International
Arab Banking Corporation
Arab
Arab
Arab
Arab
Arab
Arab
Arab

Financial Services
Hellenic Bank
Insurance

Maritime
Mining

Group

Company

Transport

Petroleum

Company

Petroleum Investments
Turkish Bank
Bahrain Islamic Bank

of these entities
Department licensing/reporting

*

Some

may

Page

be

Corporation

subject

requirements.
4

of

5

to special Treasury

OFFICE OF FOREIGN ASSETS CONTROL

Status of Kuwaiti Entities
10/04/90

Licensed to 0 crate

Controlled

Credit des Bergues
Georgetown Industries,
Inc. (including
subsidiaries)
KFIC, Inc. (including subsidiaries)
Kuwait Airways Corporation
Kuwait Asia Bank
Kuwait Investment Office (including

controlled

entities)

Kuwait Investment Authority
Kuwait Maritime Transport Company
Kuwait & Middle East Financial Investment Company
Kuwait Oil Tanker Company
Kuwait Petroleum Corporation (London) (including

licensed affiliates)

Kuwait

— North

Petroleum

Sea Holdings

(including subsidiaries)
Santa Fe International Corporation

affiliates)
Corporation (Cayman)
and affiliates)

subsidiaries
Wafra Intervest
subsidiaries

and

Not Controlled

No

Restrictions

Ltd.

(including
(including

*

Alexandria Kuwait International Bank
Bank
Arab African International
Arab Banking Corporation
Arab
Arab
Arab
Arab
Arab
Arab
Arab

Financial Services
Hellenic Bank
Insurance Group
Petroleum

Maritime
Mining

Company

Company

Transport

Petroleum Investments
Turkish Bank
Bahrain Islamic Bank

of these entities
Department licensing/reporting
*

Some

may

Page

be

Corporation

subject

requirements.
4

of

5

to special Treasury

OFFICE OF FOREIGN ASSETS CONTROL

Status of Kuwaiti Entities
10/04/90

Not Controlled No Restrictions
(continued from previous page)

Bahrain Islamic Investment
Bahrain Middle East Bank
Banco Arabe Espanol

*

Company

Banco Atlantico
Bank of Bahrain and Kuwait
Bank of Oman, Bahrain & Kuwait
CHENI

Dao Heng Bank
FRAB Bank International
Bank
Gulf International

Gulf Investment Corporation
Independent Petroleum Group

International

Contracting Group
Jordan Fertilizer Industry Company
Jordan Kuwait Bank
Korea Kuwait Banking Corporation
Kuwait
Kuwait
Kuwait
Kuwait

National
National

French Bank
Investment Projects Company
Bank
Cinema Company
Bank of Kuwait

Lebanon

National

Investment

Company

Housing Bank
Pearl Holding Company
Swiss Kuwaiti Bank
The Arab Investment Company
UBAF Arab American Bank
United Arab Shipping Company
United Bank of Kuwait
United Gulf Bank
Yemen Kuwait Bank
Oman

of these entities
Department licensing/reporting

*

Some

may

be

subject

requirements.

Page 5 of 5

to special

Treasury

OFFICE OF FOREIGN ASSETS CONTROL

Status of Kuwaiti Entities
10/04/90

Not Controlled No Restrictions
(continued from previous page)

Bahrain Islamic Investment
Bahrain Middle East Bank
Banco Arabe Espanol

*

Company

Banco Atlantico
Bank of Bahrain and Kuwait
Bank of Oman, Bahrain & Kuwait
CHENI

Dao Heng Bank
FRAB Bank

International

Gulf International
Bank
Gulf Investment Corporation
Independent Petroleum Group

International Contracting Group
Jordan Fertilizer Industry Company
Jordan Kuwait Bank
Korea Kuwait Banking Corporation
Kuwait French Bank
Kuwait Investment Projects Company
Kuwait
Kuwait

National
National

Lebanon

Bank
Cinema Company
Bank of Kuwait

National

Investment

Company

Housing Bank
Pearl Holding Company
Swiss Kuwaiti Bank
The Arab Investment Company
UBAF Arab American Bank
United Arab Shipping Company
United Bank of Kuwait
United Gulf Bank
Yemen Kuwait Bank
Oman

of these entities
Department licensing/reporting

*

Some

may

be

subject

requirements.

Page 5 of 5

to special

Treasury

ZN

AD'v'ANCE

C|F PRZNTED

.0 y, ,

FEDERAL REGZST:"R CO~Y

4810-25-N
DEPARTMENT OF THE TREASURY,

Office of Foreign Assets Cont ol
31 C. F.R. Part 570
Kuwaiti

Assets Control Regulations

AGENCY:

Office of Foreign As~~t~ Control,
the Treasury

ACTION:

Final Rule

SUKQRY:

On

the President

August

2, 1990, upon Iraq's invasion

issued Ex cutive Order No. 12722.

order he dec' ared a national
invoking
Emergency

Depa." m~n

the authority,

jete"

of

Kuwai

o

In tha

to I
alia, of the Znte"nat'otal

emergency

with respec

Economic Powers Act (50 U. S. C. 1701

a™,

et se . ),

specified sanctions again"t Iraq, and authorized =he
Secretary of the Treasury, in consultation wi:h he
Secretary of State, to take such actions, inc'ud'ng the
as might he necessa=y
promulgation of rules and regulations,
to carry out the purposes of the Orde . Pursuan to "h s
he President also issued
declaration of national emergency,
Executive Order No. 12723, at the request of the recognized
Government of Kuwait, blocking all property and interes-s
ordered

prope~y of the ~ove"ament of Kuwait as a protec=ive
On August 9, 19 0. the Preside;~t issued Exec
measure.
Orders No. 12724 and No. 12725, imposing additiona'
sanctions

on

Iraq, consistent with Resolu. ion 661,

da

= ve

ZN

AD'v'ANCE

PRZNTED

OF

FEDERAL REGZSTER CO?Y

4810-25-N
DEPARTMENT OF THE TREASURY,

i'

Office of Foreign Assets Cont ol
31 C. F. R. Part 570
Kuwaiti

AGENCY:

4

Assets Control Regulations

Office of Foreign

As

t~

Con

rol,

Depa.

m~r" of

the Treasury
ACTION:

Final Rule

SUP2~Y:

On

August

2, 1990, upon Iraq's invas

on

o.

Ku-.

ait,

the President issued Ex cutive Order No. 12722. In tha
order he dec' ared a national emergency with respec to I a=,
invoking the authority, ante= a l a, o f the Znte "nat oral
'

Emergency

Economic Powers Act (50 U. S. C. 1701

ordered specified sanctions

again-t Iraq,
in consultation

et se . ),
-he

and authorized

wi=h
he
Secretary of the Treasu~,
Secretary of State, to take such actions, includ'ng the
as might be necessa"y
promulgation of rules and regulations,
to carry out the purposes of the Orde . Pursuan to th's
he President also 'ssued
declaration of national emergency,
Executive Order No. 12723, at the request of the recognized

Government

property
measure.

of Kuwait, blocking all proper y and interes-s
of the oveznment of Kuwait as a protective
On

August

9, 19 0, the President

Orders No. 12724 and No. 12725, imposing

sanctions

on

issued Exec

-„

addi" ona'

Iraq, consistent with Resolu ion 661, da-ed

ve

6, 1990, of the United Nations Security Council,
imposing similar sanctions on Kuwait to ensure that no

and

August

States flowed to the Government of
of
In implementation
Kuwait.
Iraq in militarily-occupied

benefit

from the United

those Orders,

the Treasury Department

is issuing the

Kuwaiti

("Regulations" ).
Regulations block all property and interests

Assets Control Regulations
The

of the

property

Government

of Kuwait or

in

any person

to be the Government of Kuwait, its agencies,
instrumentalities,
and controlled entities, including the
Central Bank of Kuwait, that are in the United States, that
hereafter come within the United States, or that are or
hereafter come within the possession or control of U. S.
The Regulations
persons, including their overseas branches.
also generally prohibit:
(a) imports into the United States
of goods or services from Kuwait; (b) exports from the
United States of goods, technology or services to Kuwait or
entities operated from Kuwait; (c) any dealing by any U. S.

purporting

person

in Kuwaiti-origin

goods or any other goods from

for Kuwait; (d), transactions by U. S.
persons relating to travel by U. S. citizens and permanent
resident aliens to Kuwait, including their activities within
Kuwait; (e) transactions by U. S. persons relating to
transportation to or from Kuwait; transportation services to
or from the United States by Kuwaiti persons, vessels, or
aircraft; or the sale in the United States by any person

Kuwait

or intended

holding

authority

under the Federal Aviation

Act of any

6, 1990, of the United Nations Security Council,
imposing similar sanctions on Kuwait to ensure that no

and

August

States flowed to the Government of
of
In implementation
Kuwait.
Iraq in militarily-occupied

benefit

from the United

those Orders,

the Treasury

Department

is issuing the

("Regulations" ).
Regulations block all property and interests

Kuwaiti

Assets Control Regulations
The

property

of the

Government

of Kuwait or

in

any person

to be the Government of Kuwait, its agencies,
and controlled entities, including the
instrumentalities,
Central Bank of Kuwait, that are in the United States, that
hereafter come within the United States, or that are or
hereafter come within the possession or control of U. S.
The Regulations
persons, including their overseas branches.
also generally prohibit:
(a) imports into the United States
of goods or services from Kuwait; (b) exports from the
United States of goods, technology or services to Kuwait or

purporting

entities operated

(c) any dealing by any U. S.
person in Kuwaiti-origin goods or any other goods from
Kuwait or intended for Kuwait; (d) transactions by U. S.
persons relating to travel by U. S. citizens and permanent

resident
Kuwait;

from Kuwait;

aliens to Kuwait, including their activities within
(e) transactions by U. S. persons relating to

to or from Kuwait; transportation services to
or from the United States by Kuwaiti persons, vessels, or
aircraft; or the sale in the United States by any person

transportation

holding

authority

under

the Federal Aviation Act of any

transportation

air

by

which

includes

stop in Kuwait

any

(f) performance by U. S. persons of contracts in support of
industrial, commercial, public utility, or governmental
projects in Kuwait; and (g) any transfer of funds by U. ST
persons to the Government of Kuwait or any person in Kuwait.
EFFECTIVE DATE:

[Date of Publication]

FOR FURTHER INFORMATION:

Contact William B. Hoffman,

Chief

Tel. : (202) 535-6020, or Steven I. Pinter, Chief of
Licensing, Tel. : (202) 535-9449, Office of Foreign Assets

Counsel,

Control,

Department

SUPPLEMENTARY

of the Treasury,

INFORMATION

Washington,

All General

D. C.

Licenses issued

by

the Office of Foreign Assets Control prior to [date of

publication] may continue to be relied on to validate
actions prior to this date during the period of their
validity. Specific licenses issued prior to this date
in

continue
by the

effect according to their

terms unless

modified

Office of Foreign Assets Control.

Authorizations

contained

in General

prior to publication of these regulations
in the following sections:

Licenses issued
can

now

be found

Regulation

Section

License

Number-

8/02/90

General

License No. 1

Amended

8/15/90

General

License No. 1, amended

Section 570. 504

8/08/90

General

License No.

Section 570. 509

Issuance
Date

2

transportation

air

by

which

includes

stop in Kuwait;

any

(f) performance by U. S. persons of contracts in support of
industrial, commercial, public utility, or governmental
projects in Kuwait; and (g) any transfer of funds by ~ ST
persons to the Government of Kuwait or any person in Kuwait.
U

EFFECTIVE DATE:

[Date of Publication]

FOR FURTHER INFORMATION:

Contact William B. Hoffman,

Chief

Tel. : (202) 535-6020, or Steven I. Pinter, Chief of
Licensing, Tel. : (202) 535-9449, Office of Foreign Assets

Counsel,

Control,

Department

SUPPLEMENTARY

of the Treasury,

INFORMATION

Washington,

All General

D. C.

Licenses issued by

the Office of Foreign Assets Control prior to [date of

publication] may continue to be relied on to validate
actions prior to this date during the period of their
validity. Specific licenses issued prior to this date
continue in effect according to their terms unless modified
by the Office of Foreign Assets Control.
Authorizations

contained

in General

prior to publication of these regulations
in the following sections:

Licenses issued
can

now

be found

Regulation

Section

License

Number-

8/02/90

General

License No. 1

Amended

8/15/90

General

License No. 1, amended

Section 570. 504

8/08/90

General

License No.

Section 570. 509

Issuance
Date

2

8/08/90

General

License No.

10/15/90

General

License No. 3, amended

Section 570 ' 512

8/08/90

General

License No.

4

Revoked

8/13/90

General

License No.

5

Section 570. 504

8/15/90

General

License No.

6

Section 570. 513

8/15/90

General

License No. 7,

Amended

10/18/90

General

License No. 7, amended

Section 570. 510

8/23/90

General

License No.

8

Section 570. 514

8/27/90

General

Li'cense No. 9

Section 570. 517

8/30/90

General

License No. 10

Section 570. 505

9/01/90

General

License No. 11

Section 570. 508

9/26/90

General

License No. 12

Section 570. 520

Transactions
be authorized
by a

otherwise

by a general

Amended

3

prohibited

license contained

specific license issued pursuant

described

(5 U. S. C.

opportunity

date, are
rulemaking

this part

may

in Subpart

E

or

to the procedures

in Section 570. 801 of Subpart H.

Since the Regulations

function,

under

10/2/90

involve

a foreign

affairs

of the Administrative Procedure Act
553), requiring notice of proposed rulemaking,
for public participation, and delay in effective
Because no notice of proposed
inapplicable.
is required for this rule, the Regulatory

the provisions

Flexibility Act (5

U. S.C.

Because the Regulations

601, et

~se

.)

does not apply.

are issued with respect to a foreign

affairs function of the United States, they are not subject
to Executive Order 12291 of February 17, l981, dealing with
Federal regulations.

8/08/90

General

License No.

10/15/90

General

License No. 3, amended

Section 570. 512

8/08/90

General

License No.

4

Revoked

8/13/90

General

License No.

5

Section 570. 504

8/15/90

General

License No.

6

Section 570. 513

8/15/90

General

License No. 7,

10/18/90

General

License No. 7,

8/23/90

General

License No.

8

Section 570. 514

8/27/90

General

License No.

9

Section 570. 517

8/30/90

General

License No. 10

Section 570. 505

9/01/90

General

License No. ll

Section 570. 508

9/26/90

General

License No. 12

Section 570. 520

Transactions
be authorized
by a

otherwise

by a

general

Amended

3

Amended

prohibited

(5 U. S. C.

opportunity

date, are
rulemaking

under

license contained

this part

may

in Subpart

E

or

to the procedures

in Section 570. 801 of Subpart H.

Since the Regulations

function,

Section 570. 510

amended

specific license issued pursuant

described

10/2/90

involve

a foreign

affairs

of the Administrative Procedure Act
553), requiring notice of proposed rulemaking,
for public participation, and delay in effective
Because no notice of proposed
inapplicable.
is required for this rule, the Regulatory

the provisions

Flexibility Act (5

U. S. C.

Because the Regulations

601, et

~se

.)

does not apply.

are issued with respect to a foreign

affairs function of the United States, they are not subject
to Executive Order 12291 of February 17, l981, dealing with
Federal regulations.

These regulations

Act.

Procedure

information

contained

under the Paperwork
~se

. ).

and

pursuant

Comments

are being

in these regulations

to the Office of

submitted

prior notice

to the Administrative
For this reason, the collections of

public procedure

and

are being issued without

Management

and Budget

("OMB")

Act of 1980 (44 U. S. C. 3501

Reduction

et

the collection of information

concerning

the accuracy of estimated

average

annual

burden,

and

for reducing this burden should be directed to
Reduction Project (1505-****},Washington,
OMB, Paperwork
D. C. 20503, with copies to the Office of Foreign Assets
Control, Department of the Treasury, 1500 Pennsylvania Ave.
suggestions

N. W.

--

should

Annex,

Washington,

be submitted

not

D. C. 20220.

later

than

Any

,

such comments

[60 days from date of

Notice of OMB action on these requests will
publication].
P"
in these regulations are
The collections of information
contained

in SS 570. 503, 570. 509

—

570. 512, 570. 515,

570. 517, 570. 518, 570. 520, 570. 521, Subpart F, and
SS 570. 703, and 570. 801. This information is required
the Office of Foreign Assets Control for licensing,
compliance,

information

applicants

civil penalty

and enforcement

purposes.

by

This

will be used to determine the eligibility of
for the benefits provided through specific

licenses, to determine

subject to the
regulations are in compliance with applicable requirements,
and to determine whether and to what extent civil penalty or
whether

persons

are being issued without prior notice

These regulations

to the Administrative
For this reason, the collections of

public procedure

and

Act.

Procedure

information

contained

under the Paperwork

.) .

and

Comments

are being

in these regulations

to the Office of

submitted

~se

pursuant

and Budget

Management

("OMB")

et

Act of l980 (44 U. S. C. 3501

Reduction

the collection of information

concerning

the accuracy of estimated

average

annual

burden,

and

for reducing this burden should be directed to
Reduction Project ( 1505-****),Washington,
OMB, Paperwork
D. C. 20503, with copies to the Office of Foreign Assets
Control, Department of the Treasury, 1500 Pennsylvania Ave.
suggestions

N. W.

--

should

Annex,

Washington,

be submitted

publication].
The

not

D. C. 20220.

later

than

OMB

action

Notice of

collections of information

contained

in SS 570. 503, 570. 509

—

Any

,

such comments

[60 days from date of
on

these requests will

in these regulations

are

570. 512, 570. 515,

570. 517, 570. 518, 570. 520, 570. 521, Subpart F, and
SS 570. 703, and 570. 801. This information is required

by

the Office of Foreign Assets Control for licensing,
compliance,

information

applicants

civil penalty

and enforcement

purposes.

This

will be used to determine the eligibility of
for the benefits provided through specific

licenses, to determine

subject to the
regulations are in compliance with applicable requirements,
and to determine whether and to what extent civil penalty or
whether

persons

other enforcement
respondents

and

The likely
action is appropriate.
recordkeepers are individuals and business

organizations.
Estimated
burden:

total

and/or

recordkeeping

2000 hours.

The estimated

varies

reporting

annual

annual

with an

Estimated

per respondent/recordkeeper

to 10 hours, depending on individual
estimated average of 2 hours.

from 30 minutes

circumstances,

burden

number

of respondents

annual

frequency

and/or

recordkeepers:

1000.
Estimated

List of Subjects in 31

CFR

of responses:

1 —

12.

Part 570:

Iraq, Kuwait, Banks, Banking, Finance, Blocking of
assets, Imports, Exports, Loan Program, Penalties, Reporting
requirements.

and recordkeeping

For the reasons set forth in the preamble,
added

to 31

CFR

Chapter

PART 570--KUWAITI

AUTHORITY:

.;

22 U. S. C.

V

Part 570 is

as follows:

ASSETS CONTROL REGULATIONS

50 U. S. C. 1701

et

~se

.;

50 U. S. C. 1601

et

287c; Pub. L. 101-513, 104 Stat. 2047-55
(Nov. 5, 1990); 3 U. S. C. 301' E. O. 12722, 55 FR 31803 (Aug.

~se

other enforcement
respondents

and

The likely
action is appropriate.
recordkeepers are individuals and bustiness

organizations.
Estimated
burden:

total

and/or

recordkeeping

2000 hours.

The estimated

varies

reporting

annual

with an

Estimated

per respondent/recordkeeper

to 10 hours, depending on individual
estimated average of 2 hours.

from 30 minutes

circumstances,

burden

annual

number

of respondents

annual

frequency

and/or

recordkeepers:

1000.
Estimated

List of Subjects in 31

CFR

1 —

of responses:

12.

Part 570:

Iraq, Kuwait, Banks, Banking, Finance, Blocking of
assets, Imports, Exports, Loan Program, Penalties, Reporting
requirements.

and recordkeeping

For the reasons set forth in the preamble,
added

to 31

CFR

Chapter

PART 570--KUWAITI

AUTHORITY:

.;

22 U. S. C.

V

Part 570 is

as follows:

ASSETS CONTROL REGULATIONS

50 U. S. C. 1701

et

~se

. ; 50

U. S. C. 1601

et

287c; Pub. L. 101-513, 104 Stat. 2047-55
(Nov. 5, 1990); 3 U. S. C. 301; E. O. 12722, 55 FR 31803 (Aug.

~se

3g

1990)

E~ 0~

12723

55 FR 33091 (Aug.

Subpart

A

--

g

55 FR 31805 (Aug

3

~

1990)

E

0 12725I

13, 1990) .

Relation of this Part to Other

Laws and

Regulations

Section 570. 101 Relation of this

Subpart

B

--

art to other

laws and

Prohibitions

Section 570. 201 Prohibited
in which the Government

transactions

involvin

ro ert

of Kuwait has an interest;

transactions with res ect to securities.
Section 570. 202 Effect of transfers violatin the
rovisions of this art.
Section 570. 203 Holdin of certain t es of blocked
accounts.
ro ert in interest-bearin
Section 570. 204 Prohibited im ortation of oods or services
from Kuwait.

Section 570. 205
oods

Prohibited

technolo

Kuwait

and

reex ortation of

or services to Kuwait.

Section 570. 206 Prohibited
Section 570. 207 Prohibited

to

ex ortation

dealin

in

transactions

ro ert

relatin

or to activities within Kuwait.

Section 570. 208 Prohibited
transactions involvin

trans ortation-related
Kuwait.

to travel

3

g

1990) f

E~0

12723

55 FR 33091 (Aug.

Subpart

A

--

~

55 FR 3 1805 (Aug

3g

1990)

E

0 12725

13, 1990) .

Relation of this Part to Other

Laws and

Regulations

Section 570. 101 Relation of this

Subpart

B

--

art to other

laws and

Prohibitions

Section 570. 201 Prohibited
in which the Government

transactions

involvin

of Kuwait has

an

ro ert

interest;

transactions with res ect to securities.
Section 570. 202 Effect of transfers violatin the
rovisions of this art.
Section 570. 203 Holdin of certain t es of blocked
accounts.
ro ert in interest-bearin
Section 570. 204 Prohibited im ortation of oods or services
from Kuwait.

Section 570. 205
oods

Prohibited

technolo

Kuwait

and

reex ortation

of

or services to Kuwait.

Section 570. 206 Prohibited
Section 570. 207 Prohibited

to

ex ortation

dealin

in

transactions

ro ert

relatin

or to activities within Kuwait.

Section 570. 208 Prohibited
transactions involvin

trans ortation-related
Kuwait.

to travel

Section 570. 209 prohibited

of

erson in Kuwait.

or an

Kuwait

of funds to the

transfers

Section 570. 210 Prohibited
Government

of contracts.

erformance

Section 570. 211 Evasions; attem

ts;

cons

iracies.

Section 570. 212 Effective date.
Subpart

C

--

General

Definitions

Section 570. 301 Blocked account; blocked
Section 570. 302

Effective date.

Section 570. 303 ~Entit
Section 570. 304 Entit
overnment

ro ert

of the

Government

of Kuwait; Kuwaiti

entit

Section 570. 305 General license.
Section 570. 306

Government

of Ira

Section 570. 307

Government

of Kuwait.

Section 570. 308 Interest.
Section 570. 310 Kuwait; Kuwaiti.
Section 570. 311 Kuwaiti ori in.
Section 570. 312 Kuwaiti erson.
Section 570. 313 License.

Section 570. 314 Person.
Section 570. 315 Pro ert ; ro ert interest.
Section 570. 316 S ecific license.
Section 570. 317 Transfer.
Section 570. 318 UNSC Resolution 661.

Section 570. 209

Prohibited

Section 570. 210 Prohibited
Government

of Kuwait or

of contracts.

erformance

of funds to the

transfers

erson in Kuwait.

an

Section 570. 211 Evasions; attem

ts;

cons

iracies.

Section 570. 212 Effective date.
Subpart

C

--

General

Definitions

Section 570. 301 Blocked account; blocked

ro ert

Section 570. 302 Effective date.
Section 570. 303 ~Entit
Section 570. 304
overnment

Entit

of the

Government

of Kuwait; Kuwaiti

entit

Section 570. 305 General license.
Section 570. 306 Government of Ira
Section 570. 307

Government

Section 570 ' 308

Interest.

of Kuwait.

Section 570. 310 Kuwait; Kuwaiti.
Section 570. 311 Kuwaiti ori in.
Section 570. 312 Kuwaiti erson.
Section 570. 313 License.
Section 570. 314 Person.
Section 570. 315 Pro ert ; ro ert
Section 570. 316 S ecific license.
Section 570. 317 Transfer.
Section 570. 318 UNSC Resolution

interest.

661.

Section 570-319 United States.
Section 570. 320 U. S. financial institution.
Section 570. 321 United States erson; U. S. erson.
Subpart

D

--

Interpretations

Section 570. 401 Reference to amended sections.
Section 570. 402 Effect of amendment.
Section 570. 403 Termination and ac isition of an interest
of the Government of Kuwait.
Section 570. 404 Pa ents from blocked accounts to U. S.
ex orters and for other obli ations

Section 570. 405
bankers

Ac

rohibited.

isition of instruments

includin

acce tances.

Section 570. 406 Extensions of credit or loans to Kuwait.
Section 570. 407 Pa ents in connection with certain

transactions.
Section 570. 408 Offshore transactions.
Section 570. 409 Transshi ments throu
authorized

Section 570. 410

Im

orts of Kuwaiti

h

the United States

oods from third

countries.
Section 570. 411 Ex orts to third countries.
Section 570. 412 Release of Kuwaiti oods from bonded
warehouse or forei n trade zone.
Section 570. 413 Goods intended for ex ort to Kuwait.
Section 570. 414 Im orts of Kuwaiti oods and urchases of

Section 570. 319 United States.
Section 570. 320 U. S. financial institution.
Section 570. 321 United States erson; U. S. erson.
Subpart

D

--

Interpretations

Section 570. 401 Reference to amended sections.
Section 570. 402 Effect of amendment.
Section 570. 403 Termination and ac isition of an interest
of the Government of Kuwait.
Section 570. 404 Pa ents from blocked accounts to U. S.
ex orters and for other obli ations

Section 570. 405
bankers

Ac

rohibited.

isition of instruments

includin

acce tances.

Section 570. 406 Extensions of credit or loans to Kuwait.
Section 570. 407 Pa ents in connection with certain
authorized transactions.
Section 570. 408 Offshore transactions.
Section 570. 409 Transshi ments throu
Section 570. 410

Im

orts of Kuwaiti

h

the United States

oods from third

countries.
Section 570. 411 Ex orts to third countries.
Section 570. 412 Release of Kuwaiti oods from bonded
warehouse or forei n trade zone.
Section 570. 413 Goods intended for ex ort to Kuwait.
Section 570. 414 Im orts of Kuwaiti oods and urchases of

10

oods from Kuwait.

Section 570. 415 Setoffs

rohibited.

for 'ournalistic

Section 570. 416 Travel transactions

activit

in Kuwait.

licensed entities.

Section 570 ' 417 Transactions

amon

Section 570. 418 Transactions

incidental

to

a

licensed

transaction.
Subpart

E

--

and Statements

Licenses, Authorizations

of

Licensing Policy

Section 570. 501 Effect of license or authorization.
Section 570. 502 Exclusion from licenses and authorizations.
Section 570. 503

in U. S. financial

Section 570. 504

securities
Section 570. 505

Com

and
Com

to blocked accounts

ents and transfers

Pa

institutions.
letion of certain forei n exchan e,
commodities transactions.
letion of certain transactions

related to bankers acce tances authorized.
Section 570. 506 Pa ent b the Government of Kuwait of
obli ations to ersons within the United States
authorized.

Section 570. 507
Section 570. 508
from Kuwait

Section 570. 509

Certain ex orts to Kuwait authorized.
Im

ort of household

and

ersonal effects

authorized.
Pa

ent and transfers

authorized

for

10

oods from Kuwait.

Section 570. 415 Setoffs

rohibited.

for 'ournalistic

Section 570. 416 Travel transactions

activit

in Kuwait.

licensed entities.

Section 570. 417 Transactions

amon

Section 570. 418 Transactions

incidental

to

a

licensed

transaction.
Subpart

E

--

Licenses, Authorizations

and Statements

of

Licensing Policy

Section 570. 501 Effect of license or authorization.
Section 570. 502 Exclusion from licenses and authorizations.
Section 570. 503 Pa ents and transfers to blocked accounts
in U. S. financial

Section 570. 504

securities
Section 570. 505

Com

and
Com

institutions.
letion of certain forei n exchan e,
commodities transactions.
letion of certain transactions

related to bankers acce tances authorized.
Section 570. 506 Pa ent b the Government of Kuwait of
obli ations to ersons within the United States
authorized.

Section 570. 507
Section 570. 508
from Kuwait

Section 570. 509

Certain ex orts to Kuwait authorized.
Im

ort of household

and

ersonal effects

authorized.
Pa

ent and transfers

authorized

for

11

shi ments of oil under contract
United States

Section 570. 510

Pa

and en

route to the

rior to the effective 'date.
ent and transfers

for oods
rior to the effective
authorized

services ex orted to Kuwait
date.
Section 570. 511 Extensions and renewals authorized.
Section 570. 512 Investment and reinvestment of Government
of Kuwait funds held in blocked accounts.
Section 570. 513 Transactions related to telecommunications
and

authorized.

Section 570. 514 Transactions related to mail authorized.
Section 570. 515 Fees for rofessional services authorized.
Section 570. 516 Certain transactions with res ect to
atents trademarks
and co ri hts authorized.
Section 570. 517 Procedures established for ex ort
transactions initiated rior to the effective date.
Section 570. 518 Certain standb letters of credit and
erformance

bonds.

Section 570. 519 Certain
ersonnel authorized.
Section 570. 520

Donations

im

orts for di lomatic or official
of food to relieve

sufferin authorized.
Section 570. 521 Certain e ortations
authorized.
Sub

art

F

--

Re

orts

human

of medical su

lies

11

shi ments of oil under contract

route to the

rior to the effective 'date.

United States

Section 570. 510

and en

Pa

ent and transfers

for oods
rior to the effective
authorized

services ex orted to Kuwait
date.
Section 570. 511 Extensions and renewals authorized.
Section 570. 512 Investment and reinvestment of Government
of Kuwait funds held in blocked accounts.
Section 570. 513 Transactions related to telecommunications
and

authorized.

Section 570. 514 Transactions related to mail authorized.
Section 570. 515 Fees for rofessional services authorized.
Section 570. 516 Certain transactions with res ect to
and co ri hts authorized.
atents trademarks
Section 570. 517 Procedures established for ex ort
rior to the effective date.
transactions initiated
Section 570. 518 Certain standb letters of credit and
erformance

bonds.

Section 570. 519 Certain
ersonnel authorized.
Section 570. 520

Donations

im

orts for di lomatic or official
of food to relieve

human

sufferin authorized.
Section 570. 521 Certain e ortations of medical su
authorized.
Sub

art

F

--

Re

orts

lies

12

Section 570. 601

Re

Section 570. 602

Re

Section 570 ' 603

Re

ired records.

orts to be furnished on demand.
orts on certain corres ondent bank

accounts.
Sub

art

G

--

Penalties

Section 570. 701 Penalties.

Section 570. 702

Pre enalt

Section 570. 703

Presentation

notice.
res ondin

to re enalt

notice.
Section 570. 704 Penalt notice.
Section 570. 705 Referral to United States

De

artment

of

Justice.
Sub

art

H

--

Procedures

Section 570. 802 Decisions.
Section 570. 803 Amendment
modification

or revocation.

~1
Section 570. 805

Dele ation b

Section 570. 806 Rules

overnin

the Secretar

availabilit

information.
Sub

art I

--

Pa erwork

Reduction

Act

of the

of

12

Section 570. 601

Re

Section 57Q. 6Q2

Re

Section 57Q. 6Q3

Re

ired records.

orts to be furnished on demand.
orts on certain corres ondent bank

accounts.
Sub

art

G

--

Penalties

Section 570. 701 Penalties.

Section 570. 702

Pre enalt

Section 570. 703

Presentation

notice.
res ondin

to re enalt

notice.
notice.
Section 570. 705 Referral to United States

Section 570. 704

Penalt

De

artment

of

Justice.
Sub

art

H

--

Procedures

Section 570. 802 Decisions.
modification
Section 570. 803 Amendment

or revocation.

~1
Section 570. 805 Dele ation

Section 570. 806 Rules

b

the Secretar

overnin

availabilit

information.
Sub

art I --

Pa erwork

Reduction

Act

of the
of

13

Section 570. 901 [Reserved].

APPENDIX A TO PART 570--KUWAITI

Subpart

A

--

GOVERNMENTAL

Relation of This Part to Other

ENTITIES

Laws and

Regulations

Section 570. 101 Relation of this

(a) This part is separate

other parts of this chapter.

art to other

from,

laws and

and independent

of, the

license or authorization
contained in or issued pursuant to those other parts
authorizes any transaction prohibited by this part. No
license or authorization contained in or issued pursuant to
any other provision of law or regulation authorizes any
transaction prohibited by this part.
(b) No license or authorization contained in or issued
pursuant to this part relieves the involved parties from
complying with any other applicable laws or regulations.
Subpart

B

--

No

Prohibitions

Section 570. 201 Prohibited

transactions

involvin

ro ert

13

Section 570. 901 [Reserved].

APPENDIX A TO PART 570--KUWAITI

Subpart

A

--

GOVERNMENTAL

Relation of This Part to Other

ENTITIES

Laws and

Regulations

Section 570. 101 Relation of this

(a) This part is separate

art to other

from,

laws and

and independent

of, the

other parts of this chapter. No license or authorization
contained in or issued pursuant to those other parts
authorizes

any

transaction

prohibited

by

this part.

No

license or authorization contained in or issued pursuant to
any other provision of law or regulation authorizes any
transaction prohibited by this part.
(b) No license or authorization contained in or issued
pursuant to this part relieves the involved parties from
complying with any other applicable laws or regulations.
Subpart

B

--

Prohibitions

Section 570-201 Prohibited

transactions

involvin

ro ert

14

of Kuwait has an interest'

in which the Government

transactions

with res

ect to securities.

(a) Except as authorized

by

regulations,

rulings,

instructions, licenses, or otherwise, no property or
interests in property of the Government of Kuwait that are
in the United States, that hereafter come within the United
States, or that are or hereafter come within the possession
or control of U. S. persons, including their overseas
be transferred,

branches,

may

otherwise

dealt in.

paid, exported,

withdrawn

or

this part or by a
specific license expressly referring to this section, the
transfer (including the transfer on the books of any issuer
or agent thereof), the endorsement or guaranty of signatures
(b) Unless otherwise

on, or any other dealing

authorized

by

in any security

(or evidence

registered or inscribed in the name of the
Government of Kuwait and held within the possession or
control of a U. S. person is prohibited, irrespective of the
fact that at any time either at or subsequent to the
effective date the registered or inscribed owner thereof may
have, or appears to have, assigned, transferred,
or
otherwise disposed of any such security.
(c) A transfer of property to or from the Government of

thereof)

and not involving

a U. S. person

shall be recognized
for purposes of this section if the transfer complied with
all applicable United Nations Security Council resolutions
Kuwait

14

of Kuwait has an interest;

in which the Government

transactions

with res

ect to securities.

(a) Except as authorized

by

regulations,

rulings,

instructions, licenses, or otherwise, no property or
interests in property of the Government of Kuwait that are
in the United States, that hereafter come within the United
States, or that are or hereafter come within the possession
or control of U. S. persons, including their overseas
be transferred,

branches,

may

otherwise

dealt in.

paid, exported,

withdrawn

or

this part or by a
specific license expressly referring to this section, the
transfer (including the transfer on the books of any issuer
or agent thereof), the endorsement or guaranty of signatures
(b) Unless otherwise

on, or any other dealing

authorized

by

in any security

(or evidence
in the name of the

registered or inscribed
Government of Kuwait and held within the possession or
control of a U. S. person is prohibited, irrespective of the
fact that at any time either at or subsequent to the
effective date the registered or inscribed owner thereof may
have, or appears to have, assigned, transferred,
or
otherwise disposed of any such security.
(c) A transfer of property to or from the Government of

thereof)

and not involving

a U. S. person

shall be recognized
for purposes of this section if the transfer complied with
all applicable United Nations Security Council resolutions

Kuwait

15

as implemented

transferred,

in the country of transfer
and was otherwise

as to the property

in the country

lawful

of

transfer.
(d)

~Exam

le: If

a U. S. person acquires

which had been sold on August

to

Kuwait
would

citizen of the United

a

not be considered
has an

Kuwait

transfers

property

interest if the

in the United Kingdom.

Resolution

9, 1990,

of securities to

and

security
of

by the Government

Kingdom,

the security

of

in which the Government

August

The United

661 prior to August

a

9

transfer

Kingdom

was lawful

implemented

UNSC

9, 1990, with respect to
from the Government of

Kuwait.

Effect of transfers violatin
rovisions of this art.

Section 570. 202

the

transfer after the effective date, which is in
violation of any provision of this part or of any regulation, ruling, instruction, license, or other direction or
(a)

Any

authorization

hereunder

and involves

any property

in which

interest since
such date, is null and void and shall not be the basis for
the assertion or recognition of any interest in or right,
remedy, power or privilege with respect to such property.
(b) No transfer before the effective date shall be the
basis for the assertion or recognition of any right, remedy,
power, or privilege with respect to, or interest in, any
the Government

of

Kuwait

has or has had an

15

as implemented

transferred,

in the country of transfer
and was otherwise

as to the property

in the country

lawful

of

transfer.
(d)

~Exam

le: If

a U. S. person acquires

which had been sold on August

to

Kuwait
would

citizen of the United

a

not be considered
has an

Kuwait

transfers

property

interest if the

in the United Kingdom.

Resolution

9, 1990,

of securities to

and

security
of

by the Government

Kingdom,

the security

of

in which the Government

August

The United

661 prior to August

a

9

transfer

Kingdom

was lawful

implemented

UNSC

9, 1990, with respect to
from the Government of

Kuwait.

Section 570. 202 Effect of transfers
rovisions of this art.

violatin

the

transfer after the effective date, which is in
violation of any provision of this part or of any regulation, ruling, instruction, license, or other direction or
(a)

Any

authorization

hereunder

and involves

any property

in which

interest since
such date, is null and void and shall not be the basis for
the assertion or recognition of any interest in or right,
remedy, power or privilege with respect to such property.
(b) No transfer before the effective date shall be the
basis for the assertion or recognition of any right, remedy,
power, or privilege with respect to, or interest in, any
the Government

of

Kuwait

has or has had an

16

property

in which the Government

of Kuwait has

an

interest,

since such date, unless the person
prior to such
with whom such property is held or maintained,
date, had written notice of the transfer or by any written
or has had an interest

evidence had recognized

such

transfer.

license
or other authorization issued by or pursuant to the direction or authorization of the Director of the Office of
Foreign Assets Control before, during, or after a transfer
shall validate such transfer or render it enforceable to the
same extent that it would be valid or enforceable but for
the provisions of the International Emergency Economic
Powers Act, the United Nations Participation Act, and this
part, and any ruling, order, regulation, direction, or
instruction issued hereunder.
(c) Unless otherwise provided,

(d) Transfers

of property

which

an

appropriate

otherwise

would

be null

viitue of the provisions of
this section shall not be deemed to be null and void or
unenforceable as to any person with whom such property was
held or maintained (and as to such person only) in cases in
which such person is able to establish to the satisfaction
of the Director of the Office of Foreign Assets Control each
of the following:
(1) Such transfer did not represent a willful
violation of the provisions of this part by the person with

and void

whom

or unenforceable

such property

was

by

held or maintained;

16

property

in which the Government

of Kuwait has

an

interest,

since such date, unless the person
prior to such
with whom such property is held or maintained,
date, had written notice of the transfer or by any written
or has had an interest

evidence had recognized

such

transfer.

(c) Unless otherwise provided, an appropriate license
or other authorization issued by or pursuant to the direction or authorization of the Director of the Office of
Foreign Assets Control before, during, or after a transfer
shall validate such transfer or render it enforceable to the
same extent that it would be valid or enforceable but for
the provisions

of the International

Powers Act, the United

Emergency

Economic

Participation Act, and this
order, regulation, direction, or
Nations

part, and any ruling,
instruction issued hereunder.

of property which otherwise would be null
and void or unenforceable
by virtue of the provisions of
this section shall not be deemed to be null and void or
(d) Transfers

unenforceable

as to any person with

whom

such property

was

to such person only) in cases in
which such person is able to establish to the satisfaction
of the Director of the Office of Foreign Assets Control each
of the following:
(1) Such transfer did not represent a willful
violation of the provisions of this part by the person with
held or maintained

whom

such property

(and as

was held

or maintained;

17

(2) The person with
maintained

whom

did not have reasonable

was

cause to

or suspect,

in view of all the facts and circumstances

available

to such person, that

held or

such property
know
known

or

transfer required a
license or authorization by or pursuant to this part and was
not so licensed or authorized, or if a license or
authorization did purport to cover the transfer, that such
license or authorization had been obtained by
misrepresentation
of a third party or the withholding of
material facts or was otherwise fraudulently obtained; and
(3) Promptly upon discovery that
(i) such transfer was in violation of the
provisions of this part or any regulation, ruling,
instruction, license, or other direction or authorization
hereunder,

such

or

(ii)

transfer was not licensed or authorized
by the Director of the Office of Foreign Assets Control, or
(iii) if a license did purport to cover the
transfer, such license had been obtained by misrepresentation of a third party or he withholding of material facts
or

was otherwise

the person with

such

fraudulently
whom

obtained;

such property

was

held or maintained

filed with the Office of Foreign Assets Control a report
setting forth in full the circumstances relating to such
transfer. The filing of a report in accordance with the
provisions of this paragraph sha13. not be deemed evidence
that the terms of paragraphs (d)(1) and (2) of this section
have been satisfied.

17

(2) The person with

whom

maintained

did not have reasonable

in view of

all the facts

available

was held

cause to

or suspect,

and circumstances

to such person, that

or

such property
know
known

or

transfer required a
license or authorization by or pursuant to this part and was
not so licensed or authorized, or if a license or
authorization did purport to cover the transfer, that such
license or authorization had been obtained by
misrepresentation
of a third party or the withholding of
material facts or was otherwise fraudulently obtained; and
(3) Promptly upon discovery that
(i) such transfer was in violation of the
provisions of this part or any regulation, ruling,
instruction, license, or other direction or authorization
hereunder,

such

or

(ii)

transfer was not licensed or authorized
by the Director of the Office of Foreign Assets Control, or
(iii) if a license did purport to cover the
transfer, such license had been obtained by misrepresentation of a third party or he withholding of material facts
or

was otherwise

the person with

such

fraudulently
whom

obtained;

such property

was

held or maintained

filed with the Office of Foreign Assets Control a report
setting forth in full the circumstances relating to such
transfer. The filing of a report in accordance with the
provisions of this paragraph sha13. not be deemed evidence
that the terms of paragraphs (d)(1) and (2) of this section
have been satisfied.

18

(e) Unless licensed or authorized pursuant to this
part, any attachment, judgment, decree, lien, execution,
or other judicial process is null and void with
garnishment,

respect to

any property

date, there existed

an

in which,

on

or since the effective

interest of the

Government

of Kuwait.

of certain t es of blocked
accounts.
in interest-bearin

Section 570. 203 Holdin
ro ert

financial institution,
currently holding property subject to 5 570. 201 which, as of
the effective date or the date of receipt if subsequent to
the effective date, is not being held in an interest-bearing
(a)

account,

Any

person,

or otherwise

including

invested

a U. S.

Office of Foreign Assets Control,
property

to, or

the

or cause such property

to

must

hold such property

be held in, an interest-bearing

by

in a manner

authorized

transfer such

account or interest-bearing

status in a U. S. financial institution as of the effective
date or the date of receipt if subsequent to the effective
date of this section, unless otherwise authorized or
directed by the Office of Foreign Assets Control. This
requirement shall apply to currency and any other financial

assets,

deposits, accounts, and any proceeds resulting
from the sale of tangible or intangible property.
If
interest is credited to an account separate from that in
asset is held, the name of the
which the interest-bearing
bank

account party on both accounts must be the same and must

18

(e) Unless licensed or authorized pursuant to this
part, any attachment, judgment, decree, lien, execution,
or other judicial process is null and void with
garnishment,

respect to any property in which, on or since the effective
date, there existed an interest of the Government of Kuwait.
Section 570. 203
ro ert

Holdin

of certain

in interest-bearin

t

es of blocked

accounts.

financial institution,
currently holding property subject to I 570. 201 which, as of
the effective date or the date of receipt if subsequent to
the effective date, is not being held in an interest-bearing
(a)

account,

Any

person,

or otherwise

including

invested

a U. S.

in a manner

authorized

by

the

Office of Foreign Assets Control, must transfer such
property to, or hold such property or cause such property to
be held in, an interest-bearing
account or interest-bearing
status in a U. S. financial institution as of the effective
date or the date of receipt if subsequent to the effective
date of this section, unless otherwise authorized or
directed by the Office of Foreign Assets Control. This
requirement shall apply to currency and any other financial

assets,

deposits, accounts, and any proceeds resulting
from the sale of tangible or intangible property.
If
interest is credited to an account separate from that in
which the interest-bearing
asset is held, the name of the
bank

account party on both accounts must be the same and must

19

clearly indicate the blocked Government of Kuwait entity
having an interest in the accounts.
(b) For purposes of this section, the term "interestbearing account" means a blocked account in a U. S. financial
institution earning interest at rates that are commercially
reasonable for the amount of funds in the account. Except
as otherwise

authorized,

the funds

may

not be invested

or

of which exceeds 90 days,
unless such investments are readily marketable and are
purchased at the direction of the Government of Kuwait.
the maturity

held in instruments

(c) This section does not apply to blocked tangible
property, such as chattels, nor does it create an
affirmative obligation on the part of the holder of such
blocked tangible property to sell or liquidate the property
However, the
and put the proceeds in a blocked account.
Office of Foreign Assets Control may issue licenses
permitting

appropriate

or directing

sales of tangible property

in

cases.
Prohibited

Section 570. 204

im

ortation of oods or services

from Kuwait.

Except as otherwise
Kuwaiti
may

is

origin

may

any U. S. person

intended

to

authorized,

be imported
engage

promote

no goods

or services of

into the United States, nor

in any activity

such importation.

that promotes or

19

clearly indicate the blocked Government of Kuwait entity
having an interest in the accounts.
(b) For purposes of this section, the term "interestbearing account" means a blocked account in a U. S. financial
institution earning interest at rates that are commercially
reasonable for the amount of funds in the account. Except
as otherwise

authorized,

the funds

may

not be invested

or

of which exceeds 90 days,
unless such investments are readily marketable and are
purchased at the direction of the Government of Kuwait.

held in instruments

the maturity

(c) This section does not apply to blocked tangible
property, such as chattels, nor does it create an
affirmative obligation on the part of the holder of such
blocked tangible property to sell or liquidate the property
and put the proceeds in a blocked account.
However, the

Office of Foreign Assets Control may issue licenses
permitting or directing sales of tangible property in
appropriate

cases.
Prohibited

Section 570. 204

im

ortation of

oods or services

from Kuwait.

Except as otherwise

authorized,

no goods

or services of

into the United States, nor
may any U. S. person engage in any activity that promotes or
is intended to promote such importation.
Kuwaiti

origin

may

be imported

20

Section 570. 205
oods

Prohibited

technolo

ortation

and

reex ortation of

or services to Kuwait.

Except as otherwise

authorized,

no goods,

technology

or services

technical data or other information),

(including

from the United

be exported

may

e

States, or,

if

subject to
a third

jurisdiction, exported or reexported from
country to Kuwait, to any entity owned or controlled
Government of Kuwait, or to any entity operated from

UPS.

except donated foodstuffs
donated

supplies

8

strictly for

intended

Kuwait,

circumstances,

and

purposes,

the

medical

specifically licensed pursuant
570. 507, 570. 519, 570. 520 or 570. 521.

exportation

to

in humanitarian

by the

of

which has been

Section 570. 206

Prohibited

Except as otherwise

dealin

authorized,

in

ro ert

no U. S. person

may

deal

of Kuwaiti origin exported from Kuwait or Iraq
after August 6, 1990, property intended for exportation to
Kuwait, or property intended for exportation from Kuwait to
any other country, nor may any U. S. person engage in any
activity that promotes or is intended to promote such
in property

dealing.

Section 570. 207

to

Kuwait

Prohibited

transactions

relatin

or to activities within Kuwait.

to travel

20

Section 570. 205
oods

Prohibited

technolo

may

ortation

and

reex ortation of

or services to Kuwait.
authorized,

Except as otherwise

(including

e

no goods,

technical data or other information),
from the United

be exported

States, or,

if

U. S.

technology

or services

subject to
a third

jurisdiction, exported or reexported from
country to Kuwait, to any entity owned or controlled
Government of Kuwait, or to any entity operated from
except donated foodstuffs

in humanitarian

donated

strictly for

supplies

8

Kuwait,

circumstances,

medical

the

purposes,

and

the

specifically licensed pursuant
570. 507, 570. 519, 570. 520 or 570. 521.

exportation

to

intended

by

of

which has been

Section 570. 206

Prohibited

Except as otherwise

dealin

authorized,

ro ert

in

no U. S. person

may

deal

of Kuwaiti origin exported from Kuwait or Iraq
after August 6, 1990, property intended for exportation to
Kuwait, or property intended for exportation from Kuwait to
any other country, nor may any U. S. person engage in any
in property

activity that

promotes

or is intended

to promote such

dealing.

Section 570. 207

to

Kuwait

Prohibited

transactions

relatin

or to activities within Kuwait.

to travel

21

Except as otherwise

authorized,

no U. S. person

may

relating to travel by any U. S.
citizen or permanent resident alien to Kuwait, or to
activities by any U. S. citizen or permanent resident alien
within Kuwait, or to activities by any U. S. citizen or
permanent resident alien within Kuwait, after the effective

engage

in any transaction

date, other than transactions:
(a) Necessary to effect the departure of a U. S. citizen
or permanent resident alien from Kuwait or Iraq;
(b) Relating to travel and activities for the conduct
of the official business of the United States Government or
the United Nations;

or

(c) Relating to journalistic activity by persons
regularly employed in such capacity by a newsgathering
organization.
This section prohibits the unauthorized payment by a U. S.
person of his or her own travel or living expenses to or
within

Kuwait.

Section 570. 208 Prohibited
transactions involvin
Except as otherwise

trans ortation-related
Kuwait.

authorized,

the following

are

prohibited:
(a)

Any

transportation

transaction

to or

by a U. S. person

from Kuwait;

relating to

21

Except as otherwise

authorized,

no U. S. person

may

relating to travel by any U. S.
citizen or permanent resident alien to Kuwait, or to
activities by any U. S. citizen or permanent resident alien
within Kuwait, or to activities by any U. S. citizen or
permanent resident alien within Kuwait, after the effective
date, other than transactions:
(a) Necessary to effect the departure of a U. S. citizen
or permanent resident alien from Kuwait or Iraq;
(b) Relating to travel and activities for the conduct
of the official business of the United States Government or

engage

in any transaction

the United Nations;

or

(c) Relating to journalistic activity by persons
regularly employed in such capacity by a newsgathering
organization.
This section prohibits the unauthorized payment by a U. S.
person of his or her own travel or living expenses to or
within

Kuwait.

Section 570. 208 Prohibited
transactions involvin
Except as otherwise

trans ortation-related
Kuwait.

authorized,

the following

are

prohibited:
(a)

Any

transportation

transaction

to or

by a U. S. person

from Kuwait;

relating to

22

(b) The provision

States

United

aircraft of

by any

of transportation
Kuwaiti person or

registration;

Kuwaiti

to or
any

from the

vessel or

or

(c) the sale in the United States by any person holding
authority under the Federal Aviation Act of any

transportation

by

(d)

le:

person

~Exam

air

includes

any

stop in Kuwait.

licensed or exempted,

Unless

or provide ticketing,

insure,

may

which

ground,

no U. S.

port,

refueling, bunkering, clearance, or freight forwarding
services, with respect to any sea, ground, or air
transportation the destination of which is Kuwait, or which

is

to

intended

Section 570. 209

make

a stop in Kuwait.

Prohibited

Except as otherwise

erformance

authorized,

of contracts.

no U. S. person

may

contract, including a financing contract, in
support of an industrial, commercial, public utility, or
governmental
project in Kuwait.

perform

any

Section 570. 210 Prohibited transfer of funds to the
Government of Kuwait or an
erson in Kuwait.
Except as otherwise
commit

or transfer,

authorized,

no U. S. person

may

directly or indirectly, funds or other
or economic resources to the Government of Kuwait

financial
or any person in Kuwait.

22

(b) The provision

States

United

aircraft of

of transportation

by any Kuwaiti

Kuwaiti

to or

from the

person or any vessel or

registration;

or

(c) the sale in the United States by any person holding
authority under the Federal Aviation Act of any
transportation by air which includes any stop in Kuwait.
(d)

person

~Exam

le:

or provide ticketing,

insure,

may

licensed or exempted,

Unless

ground,

no U. S.

port,

refueling, bunkering, clearance, or freight forwarding
services, with respect to any sea, ground, or air
transportation the destination of which is Kuwait, or

is

to

intended

Section 570. 209

make

which

a stop in Kuwait.

Prohibited

Except as otherwise

er f ormance of contracts.

authorized,

no U. S. person

may

contract, including a financing contract, in
support of an industrial, commercial, public utility, or
governmental
project in Kuwait.

perform

any

Section 570. 210 Prohibited transfer of funds to the
Government of Kuwait or an
erson in Kuwait.
Except as otherwise
commit

or transfer,

authorized,

no U. S. person

may

directly or indirectly, funds or other
or economic resources to the Government of Kuwait

financial
or any person in Kuwait.

Section 570. 211 Evasions; attem
Any

transaction

effect of,

evasion or avoidance

in this subpart,

cons

iracies.

for the purpose of, or
or avoiding,

evading

ts;

is

of,

any

which has the

or which facilitates

the

set forth
attempt to

of the prohibitions

hereby prohibited.

Any

set forth in this part is hereby
prohibited.
formed for the purpose of
Any conspiracy
engaging in a transaction prohibited by this part is hereby

violate the prohibitions

prohibited.
Section 570. 212 Effective date.

effective dates of the prohibitions
contained in this subpart B are as follows:
The

and

directives

(a) With respect to SS 570. 201, 574. 202, and 570. 211,
5:00 a. m. , Eastern Daylight Time ("EDT"), August 2, 1990;
(b) With respect to SS 570. 204, 570. 205, 570. 206,

570. 207, 570. 208, 570. 209, and 570. 210, 8:55 p. m. EDT,
August 9, 1990; and
(c) With respect to 5 570. 203, [date of publication].

Subpart

C

--

General

Definitions

Section 570. 301 Blocked account; blocked

ro ert,

23

Section 570. 211 Evasions; attem
Any

transaction

effect of,

.evading

cons

iracies.

for the purpose of, or
or avoiding,

evasion or avoidance

in this subpart,

ts;

is

of,

any

which has the

or which facilitates

the

set forth
attempt to

of the prohibitions

hereby prohibited.

Any

violate the prohibitions

set forth in this part is hereby
prohibited.
Any conspiracy formed for the purpose of
engaging in a transaction prohibited by this part is hereby
prohibited.
Section 570. 212 Effective date.

effective dates of the prohibitions
contained in this subpart B are as follows:
The

and

directives

(a) With respect to SS 570. 201, 574. 202, and 570. 211,
5:00 a. m. , Eastern Daylight Time ("EDT"), August 2, 1990;
(b) With respect to SS 570. 204, 570. 205, 570. 206,

570. 207, 570. 208, 570. 209, and 570. 210, 8:55 p. m. EDT,
August 9, 1990; and
(c) With respect to 8 570. 203, I'date of publicationj .

Subpart

C

--

General

Definitions

Section 570. 301 Blocked account; blocked

ro ert

24

"blocked account" and "blocked property"

The terms

shall

mean

any account

of Kuwait has

transfers,

an

with respect

interest,

to

which

payments,

or other dealings may
or effected except pursuant to an authorization

exportations,

not be made

in which the Government

or property

or license authorizing

Section 570. 302

withdrawals,

such

action.

Effective date.

"effective date" refers to the effective date

The term

of the applicable

prohibition,

as identified

in 8570. 212.

Section 570. 303 ~Entit

"entity" includes

The term

association,

corporation,

a

partnership,

or other organization.

Section 570. 304
Government

Entit

of the

Government

of Kuwait; Kuwaiti

entit

"entity of the Government
"Kuwaiti Government 'entity" includes:
The term

of Kuwait" or

(a) Any corporation, partnership, association, or other
entity in which the Government of Kuwait owns a majority or

controlling
government,

interest,

entity

or funded by that
or any entity which is otherwise controlled by

that government;

any

managed

24

"blocked account" and "blocked property"

The terms

shall

any account

mean

of Kuwait has

transfers,
not be

an

with respect

interest,

to

which

payments,

or other dealings may
or effected except pursuant to an authorization

exportations,

made

in which the Government

or property

or license authorizing

Section 570. 302

withdrawals,

such

action.

Effective date.

"effective date" refers to the effective date

The term

of the applicable

as identified

prohibition,

in 8570. 212.

Section 570. 303 ~Entit

"entity" includes

The term

association,

corporation,

a

partnership,

or other organization.

Section 570. 304

of the

Government

of Kuwait; Kuwaiti

entit

Government

The term

Entit

"entity of the

"Kuwaiti Government

Government

of Kuwait" or

'entity" includes:

corporation, partnership, association, or other
entity in which the Government of Kuwait owns a majority or
(a)

Any

controlling

interest,

government,

or any entity which

that government;

any

entity

managed

or funded

by

is otherwise controlled

that
by

25

(b)
Kuwait,

Any

agency or instrumentality

including

of the

of

Government

the Central Bank of Kuwait.

Section 570. 305 General license.
The term

authorization

"general license"
the terms of which

Section 570. 306
The term

Government

"Government

license or
are set forth in this part.

means

any

of Ira
of Iraq" includes:

(a) The state and the Government

of Iraq, as well as
any political subdivision,
agency, or instrumentality
thereof, including the Central Bank of Iraq;
(b)

Any

organization

association, corporation, or other
substantially owned or controlled by the

partnership,

foregoing;

(c)

Any

person to the extent that such person

is,

or

or to the extent that there is reasonable cause to
believe that such person is, or has been, since the
effective date, acting or purporting to act directly or
indirectly on behalf of any of the foregoing; and
(d) Any other person or organization determined by the
has been,

Director of the Office of Foreign Assets Control to be
included within this section.
Section 570. 307

Government

of Kuwait.

25

(b)
Kuwait,

Any

agency or instrumentality

including

of the

of

Government

the Central Bank of Kuwait.

Section 570. 305 General license.

license" means any license or
the terms of which are set forth in this part.

The term "general

authorization

Section 570 306
The term

Government

"Government

of Ira
of Iraq" includes:

(a) The state and the Government

of Iraq, as well as
any political subdivision,
agency, or instrumentality
thereof, including the Central Bank of Iraq;
(b)

Any

organization

association, corporation, or other
substantially owned or controlled by the

partnership,

foregoing;

(c)
has been,

Any

person to the extent that such person

or to the extent that there is reasonable

is,

or

cause to

believe that such person is, or has been, since the
effective date, acting or purporting to act directly or
indirectly on behalf of any of the foregoing; and
(d) Any other person or organization determined by the
Director of the Office of Foreign Assets Control to be
included

within

Section 570. 307

this section.
Government

of Kuwait.

26

The term

"Government

of Kuwait" includes:

(a) The state and Government

to be the

purporting

political subdivision,
including
(b)

Government

agency,

of Kuwait
of Kuwait,

and any

entity

as well as any

or instrumentality

thereof,

the Central Bank of Kuwait;
Any

organization

association, corporation, or other
substantially owned or controlled by the

partnership,

foregoing;

(c) Any person to the extent that such person is or has
been, or to the extent that there is reasonable cause to
believe that such person is or has been, since the effective
date, acting or purporting to act directly or indirectly
behalf of any of the foregoing; and
(d)

Any

other person or organization

determined

by the

Director of the Office of Foreign Assets Control to be
included within this section.
Section 570. 308

Interest.

Except as otherwise

provided

in this part,

on

the term

"interest" when used with respect to property (e. g. , "an
interest in property") means an interest of any nature
whatsoever, direct or indirect.

26

The term "Government

of Kuwait" includes:

(a) The state and Government

to be the

purporting

Government

political subdivision,
including
(b)

agency,

of Kuwait
of Kuwait,

and any

entity

as well as any

or instrumentality

thereof,

the Central Bank of Kuwait;
Any

organization

association, corporation, or other
substantially owned or controlled by the

partnership,

foregoing;

(c) Any person to the extent that such person is or has
been, or to the extent that there is reasonable cause to
believe that such person is or has been, since the effective
date, acting or purporting to act directly or indirectly
behalf of any of the foregoing; and
(d)

Any

other person or organization

determined

by the

Director of the Office of Foreign Assets Control to be
included within this section.
Section 570. 308

Interest.

Except as otherwise

provided

in this part,

on

the term

"interest" when used with respect to property (e. g. , "an
interest in property") means an interest of any nature
whatsoever, direct or indirect.

27

"Iraq"

The term

territory

under

or illegal.

the country of Iraq and any

means

the jurisdiction

"Iraqi"
defined in this section.
The term

thereof, legal
pertaining to Iraq as

or authority

means

Section 570. 310 Kuwait; Kuwaiti.
The term "Kuwait" means

territory

under

the country of Kuwait and any

the jurisdiction

term "Kuwaiti" means pertaining

or authority

to

Kuwait

thereof.

as defined

The

in this

section.
Section 570. 311 Kuwaiti ori in.
The term "goods or

services of Kuwaiti origin"

includes:
(a) Goods produced,
within

manufactured,

grown,

or processed

Kuwait;

(b) Goods which have entered

into Kuwaiti commerce;

(c) Services performed in Kuwait or by a Kuwaiti
national who is acting as an agent, employee, or contractor
of the Government of Kuwait, or of a business entity located
Services of Kuwaiti origin are not imported into
in Kuwait.
the United States
United

States.

States

when

such services

by a Kuwaiti

national

are provided
employed

in the

in the United

27

The term

territory

"Iraq"

under

the country of Iraq and any

means

the jurisdiction

or illegal'
The term "Iraqi"
defined in this section.

thereof, legal
pertaining to Iraq as

or authority

means

Section 570. 310 Kuwait; Kuwaiti.
The term "Kuwait" means

territory

under

the country of Kuwait and any

the jurisdiction

term "Kuwaiti" means pertaining

or authority

to

Kuwait

thereof.

as defined

The

in this

section.
Section 570. 311 Kuwaiti ori in.
The term

"goods or services of Kuwaiti

origin"

includes:
(a) Goods produced,
within

manufactured,

grown,

or processed

Kuwait;

(b) Goods which have entered

into Kuwaiti commerce;

(c) Services performed in Kuwait or by a Kuwaiti
national who is acting as an agent, employee, or contractor
of the Government of Kuwait, or of a business entity located
Services of Kuwaiti origin are not imported into
in Kuwait.
the United States when such services are provided in the
United States by a Kuwaiti

States.

national

employed

in the United

28

erson.

Section 570. 312 Kuwaiti

"Kuwaiti person" means any Kuwaiti

The term
any person
owned

organized

or controlled,

national

or any person

the laws of Kuwait,

under

directly or indirectly,

citizen,

by a Kuwaiti

of Kuwait.

or the Government

Section 570. 313 License.
Except as otherwise

specified, the term "license"

license or authorization
to this part.

contained

any

means

in or issued pursuant

Section 570. 314 Person.
The term "person" means

association,

The terms

individual,

partnership,

or other organization.

corporation,

Section 570 ' 3'15 Pro ert

an

;

ro

ert

interest.

interest" include,
checks, drafts, bullion, bank

"property" and "property

but are not limited

to,

money,

deposits, savings accounts, debts, indebtedness,
obligations, notes, debentures, stocks, bonds, coupons, any
other financial instruments, banker ' s acceptances,
mortgages, pledges, liens or other rights in the nature of
security, warehouse receipts, bills of lading, trust

28

erson.

Section 570. 312 Kuwaiti
The term "Kuwaiti
any person
owned

organized

person" means any Kuwaiti

directly or indirectly,
or the Government of Kuwait.

or controlled,

national

or any person

the laws of Kuwait,

under

citizen,

by a Kuwaiti

Section 570. 313 License.

specified, the term "license"

Except as otherwise

license or authorization
to this part.

contained

any

means

in or issued pursuant

Section 570. 314 Person.
"person"

The term

association,

means

The terms

individual,

partnership,

or other organization.

corporation,

Section 570. 3'15 Pro ert

an

;

ro

ert

interest.

interest" include,
checks, drafts, bullion, bank

"property" and "property

but are not limited

to,

money,

deposits, savings accounts, debts, indebtedness,
obligations, notes, debentures, stocks, bonds, coupons, any
other financial instruments, banker's acceptances,
mortgages, pledges, liens or other rights in the nature of
security, warehouse receipts, bills of lading, trust

29

receipts, bills of sale,

letters of credit

or indebtedness,

ownership

other evidences of

any

title,

and any

relating to any rights or obligations thereunder,
chattels',
powers of attorney, goods, wares, merchandise,
stocks on hand, ships, goods on ships, real estate
documents

trust, vendor's sales agreements, land
contracts, leaseholds, ground rents, real estate and any
other interest therein, options, negotiable instruments,
trade acceptances, royalties, book accounts, accounts
deeds of

mortgages,

payable,

patents, trademarks,
policies, safe deposit boxes

judgments-,

insurance

annuities,

pooling agreements,

whatsoever,

contracts of

or copyrights,
and

services of

any nature

their contents,
any nature

whatsoever,

and any

other property, real, personal, or mixed, tangible or
intangible, or interest or interests therein, present,
future or contingent.

Section 570. 316
The term

authorization

S

ecific license.

"specific license" means any license or
not set forth in this part but issued pursuant

to this part in response to

an

application.

Section 570. 317 Transfer.
The term

or transaction,

"transfer"
whether

means

any

actual or purported

or not evidenced

by

writing,

act
and

29

receipts, bills of sale,

letters of credit

or indebtedness,

ownership

other evidences of

any

title,

and any

relating to any rights or obligations thereunder,
chattels',
powers of attorney, goods, wares, merchandise,
stocks on hand, ships, goods on ships, real estate
documents

trust, vendor's sales agreements, land
contracts, leaseholds, ground rents, real estate and any
other interest therein, options, negotiable instruments,
trade acceptances, royalties, book accounts, accounts
deeds of

mortgages,

payable,

patents,

judgments-,

insurance

annuities,

trademarks,

policies, safe deposit boxes
pooling agreements,

whatsoever,

contracts of

or copyrights,
and

services of

any nature

their contents,
any nature

whatsoever,

and any

other property, real, personal, or mixed, tangible or
intangible, or interest or interests therein, present,
future or contingent.

Section 570. 316
The term

authorization

S

ecific license.

"specific license" means any license or
not set forth in this part but issued pursuant

to this part in response to

an

application.

Section 570. 317 Transfer.
The term

or transaction,

"transfer"
whether

means

any

actual or purported

or not evidenced

by

writing,

act

30

or not done or performed

whether

intent,

the purpose,
surrender,

the United States,

within

or effect of which is to create,
or alter, directly or

release, convey, transfer,

indirectly, any right, remedy, power, privilege, or interest
with respect to any property and, without limitation upon
the foregoing,

delivery

of

shall include the making,

any assignment,

power,

execution,

conveyance,

or

check,

declaration, deed, deed of trust, power of attorney, power
of appointment, bill of sale, mortgage, receipt, agreement,
contract, certificate, gift, sale, affidavit, or statement;
the appointment of any agent, trustee, or fiduciary; the
creation or transfer of any lien; the issuance, docketing,
filing, or the levy of or under any judgment, decree,
attachment, injunction, execution, or other judicial or
administrative process or order, or the service of any
garnishment;
the acquisition of any interest of any nature
whatsoever by reason of a judgment or decree of any foreign
country; the fulfillment of any condition; the exercise of
power of attorney, or other power;
any power of appointment,
or the acquisition, disposition, transportation,
importation, exportation, or withdrawal of any security.
Section 570. 318
The term

UNSC

"UNSC

Resolution

Resolution

Security Council Resolution

No.

661.
661"

means

United Nations

661, adopted August 6, 1990,

30

or not done or performed

whether

intent,

the purpose,

within

the United States,

or effect of which is to create,

release, convey, transfer, or alter, directly or
indirectly, any right, remedy, power, privilege, or interest
with respect to any property and, without limitation upon

surrender,

the foregoing,

delivery

of

shall include the making,

any assignment,

execution,

conveyance,

power,

or

check,

declaration, deed, deed of trust, power of attorney, power
of appointment, bill of sale, mortgage, receipt, agreement,
contract, certificate, gift, sale, affidavit, or statement;
the appointment of any agent, trustee, or fiduciary; the
creation or transfer of any lien; the issuance, docketing,
filing, or the levy of or under any judgment, decree,
injunction,

attachment,

administrative

process or order, or the service of any
the acquisition

garnishment;

or other judicial or

execution,

of

any

interest of
or decree of

any nature

of a judgment
any foreign
country; the fulfillment of any condition; the exercise of
power of attorney, or other power;
any power of appointment,
or the acquisition, disposition, transportation,
importation, exportation, or withdrawal of any security.

whatsoever

by reason

Section 570. 318
The term

UNSC

"UNSC

Resolution

Resolution

Security Council Resolution

No.

661.
661"

means

United Nations

661, adopted August 6, 1990,

31

prohibiting

certain transactions

with respect

to Iraq

and

Kuwait.

Section 570. 319 United States.
The term "United

territories
jurisdiction

and

States"

possessions,

or authority

person

(including

all areas

and

under

its

the

thereof.

Section 570. 320 U. S. financial
The term "U. S.

the United States,

means

institution.

institution" means any UPS.
foreign branches) that is engaged in the
financial

of accepting deposits, making, granting,
transferring, holding, or brokering loans or credits, or
purchasing or selling foreign exchange, securities,
commodity futures or options, or procuring purchasers and
sellers thereof, as principal or agent; including, but not

business

institutions, banks, savings banks,
trust companies, securities brokers and dealers, commodity
futures and options brokers and dealers, forward contract
securities and commodities
and foreign exchange merchants,
limited to, depository

clearing corporations, investment companies,
employee benefit plans, and U. S. holding companies, U. S.
affiliates, or U. S. subsidiaries of any of the foregoing.
exchanges,

This term includes

foreign financial

those branches,

institutions

offices

which

and

agencies of

are located jn the

31

certain transactions

prohibiting

with respect

to Iraq

and

Kuwait.

Section 570. 319 United States.
The term "United

territories

and

jurisdiction

States"

possessions,

or authority

person

(including

transferring,
purchasing

institution" means any UPS.
foreign branches) that is engaged in the

holding,

or selling

futures

commodity

institution.

financial

of accepting deposits,

business

the

under

thereof.

Section 570. 320 U. S. financial
The term "U. S.

all areas

and

its

the United States,

means

making,

loans or credits,

or brokering

foreign exchange,

or options,

granting,

or

securities,

or procuring

purchasers

and

sellers thereof, as principal or agent; including, but not
limited to, depository institutions, banks, savings banks,
trust companies, securities brokers and dealers, commodity
futures
and

and options

brokers and dealers,

foreign exchange merchants,

forward

securities

contract

and commodities

clearing corporations, investment companies,
employee benefit plans, and U. S. holding companies, U. S.
affiliates, or U. S. subsidiaries of any of the foregoing.
exchanges,

This term includes

foreign financial

those branches,

institutions

offices

which

and

agencies of

are located in the

32

States, but not
offices, or agencies.

United

such

institutions'

erson; U. S.

Section 570. 321 United States
The term "United
any United

States person"

States citizen;

foreign branches,

permanent

erson.

or "U. S. person"

means

resident alien;

juridical person organized under the laws of the United
States or any jurisdiction within the United States,
foreign branches;

including

or any person in the United

States.
Subpart

D

--

Interpretations

Section 570. 401 Reference to
Except as otherwise

amended

sections.

specified, reference to

any

section

of this part or to any regulation, ruling, . order,
instruction, direction, or license issued pursuant to this
part shall be deemed to refer to the same as currently
amended.

Section 570. 402
Any

Effect of

amendment,

amendment.

modification,

section of this part or of

any

or revocation

order, regulation,

of

any

ruling,

32

States, but not,
offices, or agencies.

United

such

institutions'

erson; U. S. erson.

Section 570. 321 United States
The term
any United

"United States person"

States citizen;

foreign branches,

permanent

or "U. S. person"

resident

means

alien;

juridical person organized under the laws of the United
States or any jurisdiction within the United States,
foreign branches;

including

or any person in the United

States.
Subpart

D

--

Interpretations

Section 570. 401 Reference to
Except as otherwise

amended

sections.

specified, reference to

any

section

of this part or to any regulation, ruling, order,
instruction, direction, or license issued pursuant to this
part shall be deemed to refer to the same as currently
amended.

Section 570. 402
Any

Effect of

amendment,

amendment.

modification,

section of this part or of

any

or revocation

order, regulation,

of

any

ruling,

33

instruction, or license issued by or under the direction of
the Director of the Office of Foreign Assets Control shall
not, unless otherwise specifically provided, be deemed to
affect any act done or omitted to be done, or any civil or
criminal suit or proceeding commenced or pending prior to
such amendment, modification, or revocation.
All penalties,
forfeitures, and liabilities under any such order, regulation, ruling, instruction, or license shall continue and may
be enforced

tion

as

if

modification,

such amendment,

or revoca-

had not been made.

Section 570. 403 Termination

of the
(a) Whenever

a

ac

and

Government

transaction

isition of

an

interest

of Kuwait.

licensed or authorized

by

or

to this part results in the transfer of property
(including any property interest) from the Government of
Kuwait, such property shall no longer be deemed to be

pursuant

property

in which the Government

of Kuwait has or has

had an

interest unless there exists in the property another such
interest, the transfer of which has not been effected
pursuant to license or other authorization.
(b) Unless otherwise specifically provided in a license
or authorization issued pursuant to this part, if property
(including any property interest) is transferred or
attempted to be transferred to the Government of Kuwait,

33

instruction, or license issued by or under the direction of
the Director of the Office of Foreign Assets Control shall
not, unless otherwise specifically provided, be deemed to
affect any act done or omitted to be done, or any civil or
criminal suit or proceeding commenced or pending prior to

forfeitures,
tion, ruling,
be enforced

tion

and

liabilities

instruction,
as

if

All penalties,

or revocation.

modification,

such amendment,

under

any such

order, regula-

or license shall continue

modification,

such amendment,

and may

or revoca-

had not been made.

Section 570. 403 Termination

of the
(a) Whenever

a

ac

and

Government

transaction

isition of

an

interest

of Kuwait.

licensed or authorized

by

or

to this part results in the transfer of property
(including any property interest) from the Government of
Kuwait, such property shall no longer be deemed to be

pursuant

property

in which the Government

of Kuwait has or has

had an

inter'est unless there exists in the property another such
interest, the transfer of which has not been effected
pursuant to license or other authorization.

specifically provided in a license
or authorization issued pursuant to this part, if property
(including any property interest) is transferred or
attempted to be transferred to the Government of Kuwait,
(b) Unless otherwise

34

shall be

such property

exists

interest of the

an

Section 570. 404

to be property in

deemed

Government

ents from blocked accounts to U. S.

Pa

orters

and

for other obli ations

No

debits

may

be made

to

there

of Kuwait.

e

obligations

which

U. S. persons

to

a blocked

rohibited.
account to pay

or other persons,

including

for goods, technology or services exported prior to
the effective date, except as authorized pursuant to this

payment

part.
Section 570. 405
bankers

No

evidencing

includin

acce tances.

U. S. person

including

isition of instruments

Ac

bankers

acquire or deal in any obligation,

may

acceptances,

the obligation

where

indicate,

the documents

or the U. S. person has

actual knowledge, that the underlying transaction is in
violation of 8 570. 201, 570. 204, or 570. 205. This interpretation does not apply to obligations arising from an
underlying
pursuant

transaction

licensed or otherwise

authorized

to this part.

Section 570. 406

Extensions

of credits or loans to Kuwait.

34

shall be

such property

exists

interest of the

an

Section 570. 404

to be property in

deemed

Government

ents from blocked accounts to U. S.

pa

orters

and

for other obli ations

No

debits

may

be made

to

there

of Kuwait.

e

obligations

which

U. S. persons

to

a blocked

rohibited.
account to pay

or other persons,

including

for goods, technology or services exported prior to
the effective date, except as authorized pursuant to this

payment

part.
Section 570. 405
bankers

No

Ac

evidencing

includin

acce tances.

U. S. person

including

isition of instruments

bankers

may

acquire or deal in any obligation,

acceptances,

the obligation

where

indicate,

the documents

or the U. S. person has

actual knowledge, that the underlying transaction is in
violation of 5 570. 201, 570. 204, or 570. 205. This interpretation does not apply to obligations arising from an
underlying transaction licensed or otherwise authorized
pursuant

to this part.

Section 570. 406

Extensions

of credits or loans to Kuwait.

35

(a) The prohibition

in 8 570. 210 applies to the

of credits or loans in existence on the
effective date, whether by affirmative action or operation
of law.

unlicensed

renewal

(b) The prohibition

loans extended

in any currency.

Section 570. 407
authorized
Payments

authorized

in 8 570. 210 applies to credits or

Pa

ents in connection with certain

transactions.
are authorized

in or pursuant

in connection

with transactions

to Subpart E.

Section 570. 408 Offshore transactions.
(a) The prohibitions

contained

in SS 570. 201 and

570. 206 apply to transactions by U. S. persons in locations
outside the United States with respect to property which the
U. S. person knows, or has reason to know, that the
of Kuwait has or has
effective date.
(b) Prohibited transactions

Government

had an

interest since the

include,

but are not

limited to, importation

into locations outside the United
States of, or dealings within such locations in, goods or

services of Kuwaiti origin.

1":()

United

"

p

States or abroad, purchase,

l'"',

'h'

h

sell, finance, insure,

35

(a) The prohibition in 8 570. 210 applies to the
unlicensed renewal of credits or loans in existence on the

effective date,

whether

affirmative

by

action or operation

of law.
(b) The prohibition

loans extended

in any currency.

Section 570. 407

authorized

ents in connection with certain

Pa

transactions.

authorized
Payments

in 8 570. 210 applies to credits or

are authorized

in or pursuant

Section 570. 408

in connection

with transactions

to Subpart E.

Offshore transactions.

(a) The prohibitions

contained

in SS 570. 201 and

570. 206 apply to transactions by U. S. persons in locations
outside the United States with respect to property which the
U. S. person knows, or has reason to know, that the
Government

of Kuwait has or has

had an

interest since the

effective date.
transactions

(b) Prohibited

include,

but are not

limited to, importation

into locations outside the United
States of, or dealings within such locations in, goods or

services of Kuwaiti origin.

1:

United

t

)

. .

p

States or abroad, purchase,

I

h

h

sell, finance, insure,

36

act as

transport,

for the sale or transport

a broker

deal in, Kuwaiti crude

otherwise

oil or

petroleum

of, or

products

refined in Kuwait.
not, within the United
States or abroad, conduct transactions of any nature
whatsoever with an entity that he knows or has reason to
(2)

know

is

A

U. S. person may

a Kuwaiti

licensed

by

Government

entity unless the entity is

the Office of Foreign Assets Control to conduct

such transactions

with U. S. persons.

Section 570. 409 Transshi ments throu

the United States

in 5 570. 205 apply to the

(a) The prohibitions
importation

h

into the United States, for transshipment

or

transit,

of goods which are intended or destined for Kuwait,
or an entity operated from Kuwait.
(b) The prohibitions in 8 570. 204 apply to the
importation into the United States, for transshipment
or
transit, of goods of Kuwaiti origin which are intended or
destined for third countries.
(c)

interest

Goods in which

the Government

of Kuwait has

an

into or transshipped through
United States are blocked pursuant to 8570. 201.
which

Section 570. 410
countries.

are imported

Im

orts of Kuwaiti

oods from third

the

36

act as

transport,
otherwise

a broker

for the sale or transport

deal in, Kuwaiti crude

oil or

petroleum

of, or

products

refined in Kuwait.
(2)

A

U. S. person may

not, within the United

States or abroad, conduct transactions of any nature
whatsoever with an entity that he knows or has reason to
know is a Kuwaiti Government
entity unless the entity is
licensed by the Office of Foreign Assets Control to conduct
such transactions with U. S. persons.
Section 570. 409 Transshi ments throu

h

the United States

in 8 570. 205 apply to the

(a) The prohibitions

into the United States, for transshipment or
transit, of goods which are intended or destined for Kuwait,
or an entity operated from Kuwait.
importation

(b) The prohibitions

in 8 570. 204 apply to the

into the United States, for transshipment or
of goods of Kuwaiti origin which are intended or
for third countries.

importation

transit,
destined

(c)

interest

Goods in which

the Government

of Kuwait has

are imported

an

into or transshipped through
United States are blocked pursuant to 8570. 201.
which

Section 570. 410

countries.

Im

orts of Kuwaiti

oods from third

the

37

(a) Importation

into the United States from third

of goods, including refined petroleum products,
containing raw materials or components of Kuwaiti origin is

countries

prohibited

unless those

raw

materials

or components

were

Iraq or Kuwait prior to the effective date.
In light of the universal prohibition in UNSC Resolution 661
on the importation
of goods exported from Iraq or Kuwait

exported

after

from

6, 1990, substantial transformation of Kuwaitiorigin goods in a third country does not exempt the
third-country products from the prohibitions contained in
August

this part.
(b) Importation

into the United States of goods of

origin which were exported from Kuwait or Iraq on or
after the effective date is prohibited pursuant to 8570. 204.

Kuwaiti

Section 570. 411

Ex

(a) Exportation

orts to third countries.
of goods or technology (including
other information) from the United States

technical data and
to third countries is prohibited if the exporter knows, or
has reason to know, that the goods or technology are
to Kuwait (including passage
intended for transshipment
through, or storage in, intermediate destinations) without
coming to rest in a third country and without being
substantially trans f ormed or incorporated into manu f actured
products
technology

in a third country.
intended

The

specifically

exportation

of goods
for incorporation or

and

37

(a) Importation into the United States from third
countries of goods, including refined petroleum products,

materials

containing

raw

prohibited

unless those raw materials

or components

of Kuwaiti origin is
or components

were

Iraq or Kuwait prior to the effective date.
In light of the universal prohibition in UNSC Resolution 661
on the importation
of goods exported from Iraq or Kuwait

exported

after

from

6, 1990, substantial transformation of Kuwaitiorigin goods in a third country does not exempt the
third-country products from the prohibitions contained in
August

this part.
(b) Importation

into the United States of goods of

origin which were exported from Kuwait or Iraq on or
after the effective date is prohibited pursuant to 8570. 204.

Kuwaiti

Section 570. 411

Ex

(a) Exportation

orts to third countries.
of goods or technology (including
other information) from the United States

technical data and
to third countries is prohibited if the exporter knows, or
has reason to know, that the goods or technology are
to Kuwait (including passage
intended for transshipment
through, or storage in, intermediate destinations) without
coming to rest in a third country and without being
substantially transformed or incorporated into manufactured
products
technology

in a third country.
intended

The

specifically

of goods
for incorporation or
exportation

and

38

substantial

if

also prohibited
Kuwait,

is

order, or

the particular

being specifically

if

product

into a third-country

transformation

product

manufactured

the manufacturer's

is to
to

is

be used in

fill

a Kuwaiti

sales of the particular

to Kuwait.

product are predominantly

of goods or technology from the United
States to third countries is not prohibited where the
exporter has reasonable cause to believe that:
(1) The goods will come to rest in a third country
(b) Exportation

to Kuwait; . or
(2) The technology will come to rest in a third
country for purposes other than reexport to Kuwait.

for purposes other than reexportation

Section 570. 412 Release of Kuwaiti
warehouse

or forei

n

trade zone.

Section 570. 204 does not prohibit
bonded

warehouse

oods from bonded

the release from a

or a foreign trade zone of goods of Kuwaiti

origin imported into a bonded warehouse or
zone either prior to the effective date or
authorized pursuant to this part after the
Note: Pursuant to 8570. 201, property

a foreign

trade

in a transaction

effective date.
in which the

of Kuwait has an interest may not be released
unless authorized or licensed by the Office of Foreign
Assets Control.
Government

Section 570. 413

Goods intended

for ex ort to Kuwait.

38

substantial

if

also prohibited
Kuwait,

is

order, or

into a third-country

transformation

the particular

being specifically

if

is to

product

to

manufactured

is

be used in

fill

a Kuwaiti

sales of the particular

the manufacturer's

to Kuwait.

product are predominantly

of goods or technology
States to third countries is not prohibited
(b) Exportation

exporter has reasonable

product

cause to believe

from the United

where

the

that:

to rest in a third country
for purposes other than reexportation to Kuwait; .or
(2) The technology will come to rest in a third
country for purposes other than reexport to Kuwait.
(1)

The goods

will

come

Section 570. 412 Release of Kuwaiti
or forei

warehouse

n

oods from bonded

trade zone.

Section 570. 204 does not prohibit the release from a
bonded warehouse or a foreign trade zone of goods of Kuwaiti
origin imported into a bonded warehouse or a foreign trade
zone either prior to the effective date or in a transaction
authorized pursuant to this part after the effective date.
Note: Pursuant to 8570. 201, property in which the
Government

of

Kuwait

unless authorized

has an

interest

or licensed

by

may

not be released

the Office of Foreign

Assets Control.

Section 570. 413

Goods intended

for ex ort to Kuwait.

39

The

prohibitions

goods manufactured,

in 8 570. 201 do not apply to

contained
consigned,

if
title

subject to 8575. 518,

Kuwait

and not

Kuwait

has never held or received

after the effective date,

and

for export to
the Government of
to such goods on or

or destined

if

received from

any payment

of Kuwait with respect to such goods is
placed in a blocked account in a U. S. financial institution
pursuant to 8575. 503.
the Government

Section 570. 414

orts of Kuwaiti

Im

oods and

urchases

of

oods from Kuwait.

The

prohibitions

to the importation

in 8 570. 201 shall not apply

contained

of Kuwaiti-origin

described

in 8 570. 204

permitted

by an

if

goods and

of such goods is
or license issued pursuant to

the importation

authorization

this part.

However,

importation

are subject to the prohibitions

570. 201

570. 210.

and

any payments

Section 570. 415 Setoffs

services

in connection

with such

contained

in 88

rohibited.

setoff against a blocked account, whether by
bank or other U. S. person, is a prohibited transfer
8 570. 201 if effected after the effective date.
A

Section 570. 416 Travel transactions

for 'ournalistic

a U. S.

under

39

The

prohibitions

goods manufactured,

in 8 570. 201 do not apply to

contained
consigned,

for export to
the Government of

or destined

subject to 5575. 518, if
Kuwait has never held or received title to such goods
after the effective date, and if any payment received
and not

Kuwait

or

on

from

respect to such goods is
placed in a blocked account in a U. S. financial institution
pursuant to 8575. 503.
the Government

of

Section 570. 414

Kuwait with

orts of Kuwaiti

Im

oods and

urchases

of

oods from Kuwait.

The

prohibitions

to the importation

in 8 570. 201 shall not apply

contained

of Kuwaiti-origin

described

in 8 570. 204

permitted

by an

if

goods and

of such goods is
or license issued pursuant to

the importation

authorization

this part.

However,

importation

are subject to the prohibitions

570. 201

570. 210.

and

any payments

Section 570. 415 Setoffs

services

in connection

with such

contained

in SS

rohibited.

setoff against a blocked account, whether by
bank or other U. S. person, is a prohibited transfer
8 570. 201 if effected after the effective date.
A

Section 570. 416 Travel transactions

for 'ournalistic

a U. S.

under

40

activit

in Kuwait.

(a) Section 570. 207 does not prohibit

transactions

in Kuwait by persons regularly

journalistic

activity

by recognized

(b) For purposes

of this part:

travel
in

employed

newsgathering

organizations.

(1) a person is considered regularly employed as a
journalist if he or she is employed in a constant or regular
organization.
manner by a recognized newsgathering
Free-lance journalists
recognized

newsgathering

should

organization

or be able to demonstrate

Kuwait,

recognized

newsgathering

is likely.

such travel

providing

a resume

works or copies

requiring

of a

latter

may

of previously-published

news

transmission

by

regularly

and

by a

requiring

be demonstrated

by

free-lance

works.

(2) "Recognized newsgathering

collecting

work

listing previously-published

include those entities

travel to

that publication

organization
The

from a

have an assignment

organizations"

principally

engaged

in

for publication in the public press,
wire services, or broadcast by radio or

television.
(c) Authorized travel transactions are limited to those
incident to travel for the purpose of collecting and
disseminating information for a recognized newsgathering
organization,

to

any

and do not include

other activity

in Kuwait.

travel transactions

related

40

activit

in Kuwait.

(a) Section 570. 207 does not prohibit travel
transactions in Kuwait by persons regularly employed

journalistic

activity

by recognized

(b) For purposes

of this part:

in

newsgathering

organizations.

(1) a person is considered regularly employed as a
journalist if he or she is employed in a constant or regular
organization.
manner by a recognized newsgathering
Free-lance journalists
recognized

newsgathering

should

have an assignment

requiring

organization

from a

travel to

or be able to demonstrate

Kuwait,

recognized

newsgathering

is likely.

such travel

providing

a resume

works or copies

that publication by a
organization of a work requiring

The

latter

may

listing previously-published

of previously-published

include those entities
news

transmission

by

regularly

and

by

free-lance

works.

(2) "Recognized newsgathering

collecting

be demonstrated

organizations"

principally

engaged

in

for publication in the public press,
wire services, or broadcast by radio or

television.
(c) Authorized travel transactions are limited to those
incident to travel for the purpose of collecting and
disseminating information for a recognized newsgathering
organization,

to

any

and do not include

other activity

in Kuwait.

travel transactions

related

41

Section 570. 417 Transactions

If

two U. S. persons

have been granted

Kuwait

part authorizing
persons,

they

them

to

amon

controlled

licensed entities.
by

to this

specific licenses pursuant

with U. S.

in transactions

engage

of

the Government

also engage in transactions with each
entity owned or controlled by the Government

may

other. If an
of Kuwait, but which is not a U. S. person, has been granted
a specific license authorizing the entity to engage in
transactions with a U. S. person, that entity may engage in
transactions with a U. S. person controlled by the Government
of Kuwait which has been licensed to operate, provided such
transactions come within the scope of authorized
transactions included in the U. S. person's operating
license.
Section 570. 418 Transactions
transaction.
(a)

transaction

Any

incidental

ordinarily

to

a

licensed

incident to a licensed

necessary to give effect thereto

transaction

and

authorized,

except a transaction
an unlicensed

person or involving

by an

unlicensed,

is also
blocked

debit to a blocked

account.

le:

license authorizing the Government of
Kuwait to complete a securities sale also authorizes all
activities by other parties required to complete the sale,
(b)

~Exam

A

41

Section 570. 417 Transactions

If

two U. S. persons

have been granted

Kuwait

part authorizing
persons,

they

them

to

amon

controlled

licensed entities.
by

to this

specific licenses pursuant
in transactions

engage

of

the Government

with U. S.

also engage in transactions with each
entity owned or controlled by the Government

may

other. If an
of Kuwait, but which is not a U. S. person, has been granted
a specific license authorizing the entity to engage in
transactions with a U. S. person, that entity may engage in
transactions with a U. S. person controlled by the Government
of Kuwait which has been licensed to operate, provided such
transactions come within the scope of authorized
transactions included in the U. S. person's operating
license.
Section 570. 418 Transactions
transaction.
(a)

transaction

Any

incidental

ordinarily

to

a licensed

incident to a licensed

necessary to give effect thereto

transaction

and

authorized,

except a transaction
an unlicensed

person or involving

by an

unlicensed,

is also
blocked

debit to a blocked

account.
(h)
Kuwait

~Exam

le:

by

license authorizing

the Government

of

securities sale also authorizes all
other parties required to complete the sale,

to complete

activities

A

a

42

transactions

including

agents,

banks,

Subpart E

--

by

the buyer,

brokers,

transfer

etc.

Licenses, Authorizations,

and Statements

of

Licensing Policy

Section 570. 501 Effect of license or authorization.
(a)

No

license or other authorization

contained

in this

part, or otherwise issued by or under the direction of the
Director of the Office of Foreign Assets Control, shall be
deemed to authorize or validate any transaction effected
prior to the issuance of the license, unless specifically
provided in such license or authorization.
or license
(b) No regulation, ruling, instruction,
authorizes any transaction prohibited under this part unless
the regulation, ruling, instruction, or license is issued by
the Office of Foreign Assets Control 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 this chapter
unless the regulation, ruling, instruction or license
specifically refers to such provision.
(c) Any regulation, ruling, instruction, or license
authorizing any transaction otherwise prohibited under this

42

transactions

including

agents,

banks,

Subpart

E

--

by

the buyer,

brokers,

transfer

etc.

Licenses, Authorizations,

of

and Statements

Licensing Policy

Section 570. 501 Effect of license or authorization.
(a)

No

license or other authorization

contained

in this

part, or otherwise issued by or under the direction of the
Director of the Office of Foreign Assets Control, shall be
deemed to authorize or validate any transaction effected
prior to the issuance of the license, unless specifically
provided in such license or authorization.
or license
(b) No regulation, ruling, instruction,
authorizes any transaction prohibited under this part unless
the regulation, ruling, instruction, or license is issued by
the Office of Foreign Assets Control 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 this chapter
unless the regulation, ruling, instruction or license
specifically refers to such provision.
(c)

Any

authorizing

regulation,
any

ruling,

transaction

instruction,

otherwise

or license

prohibited

under

this

43

part, has the

effect of

removing

prohibitions

contained

in Subpart

a

the transaction,

B from

but only to the extent specifically
Unless the regulation,

otherwise

specifies,

ruling,

or

prohibition

stated
instruction,

such an authorization

by

its

terms.

or license
does not create

right, duty, obligation, claim, or interest in, or with
respect to, any property which would not otherwise exist
under ordinary principles of law.
any

Section 570. 502

Exclusion from licenses and authorizations.

Director of the Office of Foreign Assets Control
reserves the right to exclude any person, property, or
transaction from the operation of any license, or from the
The

privileges therein conferred, or to restrict the
applicability thereof with respect to particular persons,
property, transactions, or classes thereof. Such action
shall be binding upon all persons receiving actual or
constructive notice of such exclusion or restriction.
Section 570. 503 Pa ents and transfers
in U. S. financial institutions.
(a)

Any

to blocked accounts

of funds or transfer of credit or other
any payment or transfer by any U. S. person

payment

assets, including

outside the United States, to a blocked account in a U. S.
financial institution in the name of the Government of

43

part has the effect of removing a prohibition or
prohibitions contained in Subpart B from the transaction,
but only to the extent specifically
Unless the regulation,

otherwise

specifies,

ruling,

stated

instruction,

such an authorization

by

its

terms.

or license
does not create

right, duty, obligation, claim, or interest in, or with
respect to, any property which would not otherwise exist
under ordinary principles of law.
any

Section 570. 502

Exclusion from licenses and authorizations.

Director of the Office of Foreign Assets Control
reserves the right to exclude any person, property, or
transaction from the operation of any license, or from the
privileges therein conferred, or to restrict the
applicability thereof with respect to particular persons,
property, transactions, or classes thereof. Such action
shall be binding upon all persons receiving actual or
constructive notice of such exclusion or restriction.
The

Section 570. 503 Pa ents and transfers
in U. S. financial institutions.
(a)

Any

to blocked accounts

of funds or transfer of credit or other
any payment or transfer by any U. S. person

payment

assets, including

outside the United States, to a blocked account in a U. S.
financial institution in the name of the Government of

44

is

Kuwait

hereby authorized,

including

incidental

foreign

transactions, provided that such payment or
transfer shall not be made from any blocked account if such
directly or indirectly, a
payment or transfer represents,
transfer of any interest of the Government of Kuwait to any

exchange

other country or person.
(b) This section does not authorize

transfer to
that of the
the ultimate

account held in a

any blocked

or

any payment
name

other than

is

of Kuwait where such government

Government

beneficiary

of such

or transfer.

payment

(c) This section does not authorize
transfer of credit comprising an integral

or

any payment

part of

a

transaction which cannot be effected without the subsequent
issuance of a further license.
(d) This section does not authorize

the proceeds of the sale of securities

the crediting

of

or other assets, held

thereof, or the income
such securities or assets, to a blocked account

in a blocked account or a sub-account
derived

from

or sub-account,

under

any name

or designation

which

differs

of the specific blocked account
in which such securities or assets were or

from the name or designation

or sub-account

are held.
(e) This section does not authorize

any payment

or

transfer from a blocked account in a U. S. financial
institution to a blocked account held under any name or
designation which differs from the name or designation of

44

is

Kuwait

hereby authorized,

including

incidental

foreign

transactions, provided that such payment or
transfer shall not be made from any blocked account if such
directly or indirectly, a
payment or transfer represents,
transfer of any interest of the Government of Kuwait to any

exchange

other country or person.
(b) This section does not authorize

transfer to
that of the
the ultimate

account held in a

any blocked

or

any payment
name

other than

is

of Kuwait where such government

Government

beneficiary

of such

payment

or transfer.

(c) This section does not authorize any payment or
transfer of credit comprising an integral part of a
transaction which cannot be effected without the subsequent
issuance of a further

license.

(d) This section does not authorize

the proceeds of the sale of securities

of

the crediting

or other assets, held

thereof, or the income
such securities or assets, to a blocked account

in a blocked account or a sub-account
derived

from

or sub-account,

under

any name

or designation

which

differs

of the specific blocked account
in which such securities or assets were or

from the name or designation

or sub-account
are held.

(e) This section does not authorize

any payment

or

transfer from a blocked account in a U. S. financial
institution to a blocked account held under any name or
designation which differs from the name or designation of

45

the specified blocked account or sub-account
payment or transfer is made.

(f)

The

authorization

in paragraph

from which the

(a) of this section

is subject to the condition that written notification
the U. S. financial

or transfer

payment

Assets Control,

institution

Blocked Assets Section, within

or transfer.

shall confirm that the

been deposited

this part,

receiving an authorized

is furnished to the Office of Foreign

days from the date of payment

notification

from

payment

10 business

This

or transfer has

in a blocked account under the regulations

in

shall provide the account number, the name
and address of the Government of Kuwait entity in whose name
the account is held, the name and address of the transferee
U. S. financial institution,
and the amount of the payment or
and

transfer.
transfer of the funds of a
deposit account to a blocked interest-bearing

(g) This section authorizes

blocked

demand

account under the same

name

or designation

as was the

demand

deposit account, as required pursuant to 5 570. 203 or at the
instruction of the depositor, at any time. If such transfer

is to

in a different

U. S.

financial
institution, the transferee financial institution must
furnish, within 10 business days of the date of transfer,
the notification described in paragraph (f) of this section
to the Office of Foreign Assets Control, Blocked Assets
a blocked account

Section.

the specified blocked account or sub-account

or transfer

payment

(f)

The

is

from which the

made.

authorization

in paragraph

(a) of this section

is subject to the condition that written notification from
the U. S. financial institution receiving an authorized
payment or transfer is furnished to the Office of Foreign
Assets Control,

Blocked Assets Section, within

days from the date of payment

notification

shall confirm that the

been deposited

this part,

or transfer.
payment

10 business

This

or transfer has

in a blocked account under the regulations

in

shall provide the account number, the name
and address of the Government of Kuwait entity in whose name
the account is held, the name and address of the transferee
and the amount of the payment or
U. S. financial institution,
and

transfer.
transfer of the funds of a
deposit account to a blocked interest-bearing

(g) This section authorizes

blocked

demand

account under the same

name

or designation

as was the

demand

deposit account, as required pursuant to 5 570. 203 or at the
instruction of the depositor, at any time. If such transfer

is to

in a different

U. S.

financial
institution, the transferee financial institution must
furnish, within 10 business days of the date of transfer,
a blocked account

the notification

described

in paragraph

(f) of this section

to the Office of Foreign Assets Control, Blocked Assets
Section.

46

(h) This section authorizes

of assets

the transfer

institutions at
the instruction of the depositor for purposes of investment
and reinvestment
of assets in which the Government of Kuwait
has an interest, as authorized in 8 570. 512. If such
transfer is to a blocked account in a different U. S.
financial institution, the transferee financial institution
blocked accounts

between

must

furnish,

within

in U. S. financial

10 business

days of the date of

transfer, the notification described in paragraph (f) of
this section to the Office of Foreign Assets Control,
Blocked Assets Section.
Section 570. 504

securities

Com

and

letion of certain forei
commodities transactions.

(a) U. S. financial

institutions

n

exchan e

to
perform and complete in accordance with its terms or, in
agreement with the Government of Kuwait, to close out,
offset, or liquidate, individually or on a net basis with
subcontracts or other contracts, any contract with or on
behalf of the Government of Kuwait, except as otherwise
noted in paragraph (d) below, for foreign exchange,
securities, currency, and interest rate transactions
(including, without limitation, spot, forward, option, swap,
and futures transactions),
and commodity option, swap, and
futures

transactions

margin

or settlement

(including

variation

are authorized

the posting
with respect

or payment

to

of

46

(h) This section authorizes

of assets

the transfer

institutions at
the instruction of the depositor for purposes of investment
and reinvestment
of assets in which the Government of Kuwait
has an interest, as authorized in 5 570. 512. If such
transfer is to a blocked account in a different U. S.
financial institution, the transferee financial institution
blocked accounts

between

must

furnish,

within

in U. S. financial

10 business

days of the date of

transfer, the notification described in paragraph (f) of
this section to the Office of Foreign Assets Control,
Blocked Assets Section.
Section 570. 504

securities

Com

and

letion of certain forei
commodities transactions.

(a) U. S. financial

institutions

n

exchan e

to
perform and complete in accordance with its terms or, in
agreement with the Government of Kuwait, to close out,
offset, or liquidate, individually or on a net basis with
subcontracts or other contracts, any contract with or on
behalf of the Government of Kuwait, except as otherwise
noted in paragraph (d) below, for foreign exchange,
securities, currency, and interest rate transactions
(including, without limitation, spot, forward, option, swap,
and futures transactions),
and commodity option, swap, and
futures

transactions

margin

or settlement

(including

variation

are authorized

the posting or payment
with respect

to

of

47

transactions described above, provided the contract was
entered into prior to the effective date and any of the
following

requirements

(1)

Any

funds,

is

met:

currency,

securities,

or other

assets to be paid or delivered to the Government of Kuwait
are credited to a blocked account in the name of the entity
of the Government of Kuwait with which, or on whose behalf,
the transaction was executed; or
(2) Any funds, currency, securities, or other
assets to be paid or delivered to the Government of Kuwait
are credited to a blocked account in the name of the entity
of the Government of Kuwait and in the financial institution
and location designated in the original payment instructions
or terms of settlement or delivery for that contract;
provided that the country in which payment, settlement, or
delivery occurs has in place an arrangement satisfactory to
the Office of Foreign Assets Control for ensuring that
Government of Kuwait assets in such accounts are blocked or

restricted;

or

(3) All funds, currency, securities, or other
assets due to the Government of Kuwait in connection with
such transaction

were paid or delivered

to the

Government

prior to the effective date.
(b) All transactions by U. S. persons incidental
transactions authorized in paragraph (a) are also

of

Kuwait

authorized.

to the

47

transactions described above, provided the contract was
entered into prior to the effective date and any of the
following

requirements

(1)

Any

funds,

is

met:

currency,

securities,

or other

assets to be paid or delivered to the Government of Kuwait
are credited to a blocked account in the name of the entity
of the Government of Kuwait with which, or on whose behalf,
the transaction was executed; or
(2) Any funds, currency, securities, or other
assets to be paid or delivered to the Government of Kuwait
are credited to a blocked account in the name of the entity
of the Government of Kuwait and in the financial institution
and location designated in the original payment instructions
or terms of settlement or delivery for that contract;
provided that the country in which payment, settlement, or
delivery occurs has in place an arrangement satisfactory to
the Office of Foreign Assets Control for ensuring that
Government of Kuwait assets in such accounts are blocked or

restricted; or
(3) All funds, currency, securities, or other
assets due to the Government of Kuwait in connection with
such transaction

were paid or delivered

to the

Government

prior to the effective date.
(b) All transactions by U. S. persons incidental
transactions authorized in paragraph (a) are also

of

Kuwait

authorized.

to the

48

(c) This section does not authorize the crediting of
the funds, currency, securities, or other assets received
by, or for the benefit of, the Government of Kuwait in a
transaction

authorized

or sub-account

or designation

in paragraph

(a) to a blocked account

for the Government of Kuwait under any name
which differs from the name or designation of

the specific blocked account or sub-account

in which the

assets utilized by, or on behalf of, the Government
Kuwait in such transaction,
were originally held.
Section 570. 505

Com

of

letion of certain transactions

related to bankers acce tances authorized.

af Kuwait are
authorized to buy, sell, and satisfy obligations with
respect to bankers acceptances, and to pay under deferred
involving an interest of the
payment undertakings,
Government of Kuwait as long as the bankers acceptances were
created or the deferred payment undertakings were incurred
prior to the effective date.
(b) Persons other than the Government of Kuwait are
authorized to buy, sell, and satisfy obligations with
respect to bankers acceptances, and to pay under deferred
(a) Persons other than the Government

payment

undertakings,

exportation
an

involving

of goods to or

interest of the

the importation

from Kuwait

Government

that

or

do not involve

of Kuwait as long as the

48

(c) This section does not authorize the crediting of
the funds, currency, securities, or other assets received
by, or for the benefit of, the Government of Kuwait in a

transaction

authorized

or sub-account
or designation

in paragraph

(a) to a blocked account

for the Government of Kuwait under any name
which differs from the name or designation of

the specific blocked account or sub-account

in which the

assets utilized by, or on behalf of, the Government
were originally held.
Kuwait in such transaction,
Section 570. 505

Com

of

letion of certain transactions

related to bankers acce tances authorized.
of Kuwait are
authorized to buy, sell, and satisfy obligations with
respect to bankers acceptances, and to pay under deferred
involving an interest of the
payment undertakings,
(a) Persons other than the Government

of Kuwait as long as the bankers acceptances were
created or the deferred payment undertakings were incurred
prior to the effective date.
(b) Persons other than the Government of Kuwait are
authorized to buy, sell, and satisfy obligations with
respect to bankers acceptances, and to pay under deferred

Government

payment

undertakings,

exportation
an

involving

of goods to or

interest of the

the importation

from Kuwait

Government

that

or

do not involve

of Kuwait as long as the

49

bankers

acceptances or the deferred payment

undertakings

prior to the effective date.
(c) Nothing in this section shall authorize or permit
debit to a blocked account. Specific licenses for the
debiting of a blocked account may be issued on a case-bycase basis.

were accepted

Section 570. 506 Pa
obli ations to
authorized.

of Kuwait of
ersons within the United States
ent b

the Government

of funds after the effective date by,
U. S. financial institution
or other U'. S.

(a) The transfer
through,

or to any

person solely for the purpose

of

payment

of obligations

of

to persons or accounts within the
United States is authorized, provided that the obligation
arose prior to the effective date, and the payment requires
no debit to a blocked account.
Property is not blocked by
virtue of being transferred or received pursuant to this
section.
(b) A person receiving payment under this section may
distribute all or part of that payment to any person,
provided that any such payment to the Government of Kuwait,
must be to a blocked account in a U. S. financial
institution.
the Government

Section 570. 507

of

Kuwait

Certain ex orts to Kuwait authorized.

a

49

bankers

acceptances or the deferred payment

undertakings

prior to the effective date.
(c) Nothing in this section shall authorize or permit
debit to a blocked account. Specific licenses for the
debiting of a blocked account may be issued on a case-bycase basis.

were accepted

Section 570. 506

Pa

ent b

the Government

of Kuwait of

obli ations to ersons within the United States
authorized.

of funds after the effective date by,
through, or to any U. S. financial institution or other U. S.
person solely for the purpose of payment of obligations of
the Government of Kuwait to persons or accounts within the
(a) The transfer

United States

is authorized,

that the obligation

provided

arose prior to the effective date, and the payment requires
no debit to a blocked account.
Property is not blocked by

virtue of being transferred
section.
(b)

A

distribute

payment

all or part of that

under

payment

to

to this

this section

may

any person,

that any such payment to the Government of
be to a blocked account in a U. S. financial

provided
must

person receiving

or received pursuant

Kuwait

institution.
Section 570. 507 Certain ex orts to Kuwait authorized.

a

50

exportation

of

any item,

or product from the

commodity,

States to or destined for

United

incident to the

ordinarily

(a) All transactions

if:

are authorized

Kuwait

(1) such exports would ordinarily be authorized
under one of the following regulations administered by the
Department of Commerce: 15 CFR 371.6 — General license
(accompanied

BAGGAGE

371. 13

—

General

baggage);

and unaccompanied

license

GUS

its

relief or

personnel

prohibited

or

in this part are

to the procedures
the Office of Foreign Assets

unless licensed pursuant
in Section 570. 801 by

described

its

.

authorized

not otherwise

use of the

(excluding

related to exportation

(b) All transactions

reexportation

official

agencies

and

agencies)

developmental

and

or,

(2) such exports are for the
United Nations,

to personnel

(shipments

agencies of the U. S. Government);

15 CFR

Control.

Section 570. 508
from Kuwait

Im

origin,

of household

including

use, of persons arriving

indirectly

and

ersonal effects

authorized.

The importation

Kuwaiti

ort of household

baggage

effects of

and

personal

and

articles for

family

in the United States directly

is authorized.

or

Articles included in
such effects may be imported without limitation provided
they were actually used by such persons or their family
from Kuwait

50

exportation

of

any item,

or product from the

commodity,

States to or destined for

United

incident to the

ordinarily

(a) All transactions

if:

are authorized

Kuwait

(1) such exports would ordinarily be authorized
under one of the following regulations administered by the
Department of Commerce: 15 CFR 371.6 — General license
(accompanied

BAGGAGE

371. 13

— General

baggage);

and unaccompanied

license

GUS

to personnel

(shipments

agencies of the U. S. Government);

15 CFR
and

or,

(2) such exports are for the official use of the
United Nations, its personnel and agencies (excluding its

relief or

agencies)

developmental

.

related to exportation

(b) All transactions

or

reexportation not otherwise authorized in this part are
prohibited unless licensed pursuant to the procedures
described in Section 570. 801 by the Office of Foreign Assets
Control.

Section 570. 508
from Kuwait

Im

origin,

and

ersonal effects

authorized.

The importation

Kuwaiti

ort of household

of household

including

use, of persons arriving

baggage

and personal
and

effects of

articles for

family

in the United States directly

is authorized.

or

Articles included in
such effects may be imported without limitation provided
they were actually used by such persons or their family
indirectly

from Kuwait

51

sale,

are not intended

abroad,

members

and

are not otherwise

Section 570. 509

for

any

other person or for

from importation.

prohibited

for
shi ments of oil under contract and en route to the
United States rior to the effective date.
Pa

ents and transfers

authorized

(a) Oil of Kuwaiti origin or oil in which the
Government

of

Kuwait

has an

the United States only

interest

may

be imported

into

if:

(1) prior to the effective date, the oil was
loaded for ultimate delivery to the United States on board
vessel in Iraq, Kuwait, or a third country;
(2) the oil was imported into the United States

a

before 11:59 p. m. Eastern Daylight Time, October 1, 1990;
and

(3) the bill of lading accompanying
issued prior to the effective date.
(b)

Any

payment

owed

the oil

was

or balance not paid to or for the

benefit of the Government of Kuwait prior to the effective
date for oil imported pursuant to paragraph (a) must be paid
into a blocked account in a U. S. financial institution.
(c) Transactions conducted pursuant to this section
must be reported in writing to the Office of Foreign Assets
Control, Blocked Assets Section, no later than 10 days after
the date of importation.

abroad,

members

sale,

and

are not intended

are not otherwise

for

prohibited

any

other person or for

from importation.

Section 570. 509 Pa ents and transfers authorized for
shi ments of oil under contract and en route to the
United States rior to the effective date.
(a) Oil of Kuwaiti origin or oil in which the
.Government

of Kuwait has an interest
the United States only if:

may

be imported

into

(1) prior to the effective date, the oil was
loaded for ultimate delivery to the United States on board
vessel in Iraq, Kuwait, or a third country;
(2) the oil was imported into the United States
before 11:59 p. m. Eastern Daylight Time, October 1, 1990;

a

and

(3) the bill of lading accompanying
issued prior to the effective date.
(b)

Any

payment

owed

the oil

was

or balance not paid to or for the

benefit of the Government of Kuwait prior to the effective
date for oil imported pursuant to paragraph (a) must be paid
into a blocked account in a U. S. financial institution.
(c) Transactions conducted pursuant to this section
must be reported in writing to the Office of Foreign Assets
Control, Blocked Assets Section, no later than 10 days after
the date of importation.

52

this provision have
been completed prior to [publication date]. The text of this
section is included for the convenience of the user.
Section 570. 510
and

authorized

Transactions

Note:

by

ents and transfers

Pa

services ex orted to

Kuwait

for oods
rior to the effective
authorized

date.
(a) Specific licenses

basis to permit

payment

may

under

by a U. S.

be issued
a financing

on a

case-by-case

arrangement

institution, from a
blocked account or otherwise, of amounts owed to or for the
benefit of a person with respect to goods or services
exported prior to the effective date directly or indirectly
to Kuwait, or to third countries for an entity operated from
Kuwait, or for the benefit of the Government of Kuwait,
where the license application presents evidence satisfactory
to the Office of Foreign Assets Control that:
(1) the exportation occurred prior to the
effective date (such evidence may include, e. g. , the bill of
lading, the air waybill, the purchaser's written confirmation of completed services, customs documents, and insurance
requiring

payment

documents);

and

(2 )

if

effective date,
delivery

financial

delivery
due

or performance

diligence

of the goods

was

from Kuwait

occurred after the

exercised to divert.
and

to effect final

52

this provision have
date]. The text of this

authorized

Transactions

Note:

by

prior to Ipublication
section is included for the convenience

been completed

Section 570. 510
and

pa

of the user.

ents and transfers

services ex orted to

Kuwait

authorized

for

oods

rior to the effective

date.
(a) Specific licenses

basis to permit

payment

may

under

by a U. S.

be issued on a case-by-case
a financing

arrangement

institution, from a
blocked account or otherwise, of amounts owed to or for the
benefit of a person with respect to goods or services
exported prior to the effective date directly or indirectly
to Kuwait, or to third countries for an entity operated from
Kuwait, or for the benefit of the Government of Kuwait,
where the license application presents evidence satisfactory
to the Office of Foreign Assets Control that:
(1) the exportation occurred prior to the
effective date (such evidence may include, e. g. , the bill of
lading, the air waybill, the purchaser's written confirmation of completed services, customs documents, and insurance
requiring

payment

documents);

financial

and

if

or per f ormance occurred after the
effective date, due diligence was exercised to divert
(2 )

delivery

delivery

of the goods

from Kuwait

and

to effect final

53

delivery
prevent

of the goods to a non-prohibited
performance

destination,

or to

of the services.

(b) This section does not authorize

exportation

or the

of services after the effective date pursuant to
a contract entered into or partially performed prior to the

performance

effective date.
(c) Transactions conducted under specific licenses
granted pursuant to this section must be reported in writing
to the Office of Foreign Assets Control, Blocked Assets
Section, no later than 10 days after the date of payment.
(d) Separate criteria may be applied to the issuance of
licenses authorizing payment from an account of or held by a
blocked U. S. bank owned or controlled by the Government of
Kuwait.

Section 570. 511 Extensions

and renewals

authorized.

at the request of the
account party, of a letter of credit or a standby letter of
credit issued or confirmed by a U. S. financial institution
(a) The extension

or renewal,

is authorized.
(b) Transactions

conducted

pursuant

to this section

to the Office of Foreign Assets Control,
Blocked Assets Section, within 10 days after completion of
the transaction.

must be reported

Section 570. 512 Investment

and reinvestment

of

Government

53

of the goods to a non-prohibited destination, or to
prevent performance of the services.
(b) This section does not authorize exportation or the
performance of services after the effective date pursuant to
a contract entered into or partially performed prior to the
effective date.
(c) Transactions conducted under specific licenses

delivery

granted

pursuant

to this section

must be

reported

in writing

to the Office'of Foreign Assets Control, Blocked Assets
Section, no later than 10 days after the date of payment.
(d) Separate criteria may be applied to the issuance of
licenses authorizing payment from an account of or held by a
blocked U. S . bank

owned

or controlled

by

the Government

of

Kuwait.

Section 570. 511 Extensions

and renewals

authorized.

(a) The extension or renewal, at the request of the
account party, of a letter of credit or a standby letter of

credit issued or confirmed

by a U. S.

institution

financial

is authorized.
(b) Transactions

conducted

pursuant

to this section

to the Office of Foreign Assets Control,
Blocked Assets Section, within 10 days after completion of
the transaction.

must be reported

Section 570. 512 Investment

and reinvestment

of

Government

54

of Kuwait funds held in blocked accounts.
(a) U. S. financial

to invest
the

name

following

institutions

are hereby authorized

reinvest assets held in blocked accounts in
of the Government of Kuwait, subject to the
and

conditions:

assets representing such investments and
reinvestments are credited to a blocked account or
sub-account which is in the name of the Government of Kuwait
and which is located in the United States or within the
possession or control of a U. S. person;
(2) The proceeds of such investments and
reinvestments are not credited to a blocked account or
sub-account under any name or designation which differs from
the name or designation of the specific blocked account or
sub-account in which such funds or securities were held; and
(3) No immediate financial or economic benefit
accrues to the Government of Iraq, a person in Iraq, or a
(1)

The

in Kuwait.

person

(b)(1)

U. S. persons

authorization

must

Assets Control,

transactions

seeking to avail themselves

of this

register with the Office of Foreign

Blocked Assets Section, before undertaking

authorized

under

(2) Transactions

this section.

conducted

pursuant

to this

to the Office of Foreign Assets
Control, Blocked Assets Section, within 10 days after
completion of the transaction.
section

must be reported

54

of Kuwait funds held in blocked accounts.
(a) U. S. financial

institutions

are hereby authorized

assets held in blocked accounts in
the name of the Government of Kuwait, subject to the
following conditions:
(1) The assets representing such investments and
reinvestments are credited to a blocked account or
sub-account which is in the name of the Government of Kuwait

to invest

and

reinvest

is located

and which

in the United States or within

or control of a U. S. person;

possession

(2) The proceeds of such investments

reinvestments

sub-account

the

name

the

are not credited to a blocked account or
under

any name

or designation

or designation

which

differs

from

of the specific blocked account or

in which such funds or securities

sub-account

and

were held;

and

(3) No immediate financial or economic benefit
accrues to the Government of Iraq, a person in Iraq, or a
in Kuwait.

person

(b)(1)

U. S. persons

authorization

must

Assets Control,

transactions

seeking to avail themselves

of this

register with the Office of Foreign

Blocked Assets Section, before undertaking

authorized

under

(2) Transactions

this section.

conducted

pursuant

to this

to the Office of Foreign Assets
Control, Blocked Assets Section, within 10 days after
completion of the transaction.

section

must be reported

Section 570. 513 Transactions

related to telecommunications

authorized.

of U. S.

All transactions

the receipt and transmission
Kuwait

are authorized,

of telecommunications

provided

that

of Kuwait or persons in
blocked account in a U. S. financial
Government

Section 570. 514 Transactions
All transactions

transfers to

carriers with respect to

common

by U. S.

any payment

Kuwait

is

involving
owed

to the

paid into a

institution.

related to mail authorized.
persons,

including

payment

and

carriers, incident to the receipt or
transmission of mail between the United States and Kuwait
are authorized, provided that mail is limited to items not
exceeding

common

12 ounces.

Section 570. 515
authorized.

Fees for

rofessional

services

Specific licenses may be issued on a case-by-case basis
to permit payment to U. S. persons providing professional
services to the Government of Kuwait including, but not
limited to, legal, accounting, and investment advisory
services.
Section 570. 516

Certain transactions

with res

ect to

Section 570. 513 Transactions

related to telecommunications

authorized.
All transactions

of

U. S. common

the receipt and transmission
Kuwait

are authorized,

of telecommunications

provided

that

of Kuwait or persons in
blocked account in a U. S. financial

Government

Section 570. 514 Transactions
All transactions

carriers with respect to

by U. S.

any payment

Kuwait

is

involving
owed

to the

paid into a

institution.

related to mail authorized.
persons,

including

payment

and

carriers, incident to the receipt or
transmission of mail between the United States and Kuwait
are authorized, provided that mail is limited to items not

transfers

to

exceeding

12 ounces.

common

Section 570. 515
authorized.

Fees for

rofessional

services

Specific licenses may be issued on a case-by-case basis
to permit payment to U. S. persons providing professional
services to the Government of Kuwait including, but not
limited to, legal, accounting, and investment advisory
services.
Section 570. 516

certain transactions

with res

ect to

56

atents

trademarks

and co

ri hts

authorized.

related to the registration and renewal
in the United States Patent and Trademark Office or the
United States Copyright Office of patents, trademarks, and
copyrights in which the Government of Kuwait or a person in
Transactions

Kuwait

has an

interest are authorized.

Section 570. 517

Procedures

transactions

initiated

(a) Goods awaiting

effective date
Service

on

and

for ex ort
rior to effective date.
established

exportation

seized or detained

to

Kuwait
by

on

the

the U. S. Customs

the effective date or thereafter

may

be released

to the exporter, provided the following documents are filed
with Customs officials at the port where such goods are
located:
(1) A copy of the contract governing the
exportation (sale or other transfer) of the goods to Kuwait
or, if no contract exists, a written explanation of the
of exportation, including in either case a
description of the manner and terms of payment received or
to be received by the exporter (or other person) for, or by
reason of, the exportation of the goods;
circumstances

(2)
documentation

invoice, bill of lading, or other
fully describing the goods; and

An

56

atents

trademarks

and

co

ri hts authorized.

related to the registration and renewal
in the United States Patent and Trademark Office or the
United States Copyright Office of patents, trademarks, and
copyrights in which the Government of Kuwait or a person in
Transactions

has an

Kuwait

interest are authorized.

Section 570. 517

Procedures

transactions

initiated

(a) Goods awaiting

effective date
Service

on

and

for ex ort
rior to effective date.
established

exportation

seized or detained

to

Kuwait
by

on

the

the U. S. Customs

the effective date or thereafter

may

be released

to the exporter, provided the following documents are filed
with Customs officials at the port where such goods are
located:
(1) A copy of the contract governing the
exportation (sale or other transfer) of the goods to Kuwait
or, if no contract exists, a written explanation of the
circumstances of exportation, including in either case a
description of the manner and terms of payment received or
to be received by the exporter (or other person) for, or by
reason of, the exportation of the goods;
(2) An invoice, bill of lading, or other
documentation
fully describing the goods; and

(3)
the following
Any

statement

A

the exporter substantially

by

in

form:

received from or

amount

of Kuwait

to

Service

behalf of the Government

of the attempted

by reason

goods released

on

of exporter]

[name

[date],

exportation
by

of the

the UPS.

fully described in the
attached documents, has been or will be placed into a
blocked account in a U. S. bank and the Office of
Foreign Assets Control, Blocked Assets Section, will be
Customs

on

notified.

and

of exporter] agrees to
fully indemnify the U. S. Government for any amount
ultimately determined by a court of competent jurisdicimmediately

tion to be

due

[Name

or payable to or for the benefit of any

person by reason of the failure

of

[name

of exporter]

to properly pay into a blocked account any amount
received for the goods from or on behalf of the
Government of Kuwait.
[Name of exporter] also agrees
to waive all claims (1) against any payments received
and placed

into a blocked account, except as

later authorized

the U. S. Government

disposition
account.

of the

should

amounts

be

or license,

with regard

and

to the

placed into a blocked

be dated and signed by the exporter

to sign on the exporter's behalf.
Customs Service may release the goods to the exporter
receipt of the documentation and statement described

by a person

upon

regulations,

(2) against

The statement

The

by law,

may

authorized

or

(3)
the following
Any

statement

A

the exporter substantially

by

in

form:

received from or

amount

of Kuwait

to

Service

behalf of the Government

of the attempted

by reason

goods released

on

of exporter]

[name

[date],

exportation
by

of the

the U. S.

fully described in the
attached documents, has been or will be placed into a
blocked account in a U. S. bank and the Office of
Foreign Assets Control, Blocked Assets'Section, will be
Customs

on

notified.

and

of exporter ] agrees to
fully indemnify the U. S. Government for any amount
ultimately determined by a court of competent jurisdicimmediately

tion to be

[Name

or payable to or for the benefit of any
person by reason of the failure of [name of exporter]
to properly pay into a blocked account any amount
due

received for the goods from or

of Kuwait.

on

behalf of the

of exporter] also agrees
to waive all claims (1) against any payments received
and placed into a blocked account, except as may be

Government

later authorized

regulations,

the U. S. Government

disposition
account.

of the

should

amounts

or license,

with regard

and

to the

placed into a blocked

be dated and signed by the exporter

to sign on the exporter's behalf.
Customs Service may release the goods to the exporter
receipt of the documentation and statement described

by a person

upon

by law,

(2) against

The statement

The

[Name

authorized

or

58

it is

above, provided

regulations

satisfied that all

of such hold harmless
appropriate.

assurances

will be forwarded

Control

for review

Certain standb

payment

the execution

shall determine
received

to be
by

letters of credit

and

bonds.

erformance

(a)(1)

it

laws and

to the Office of Foreign Assets
appropriate action.

Customs

Section 570. 518

as

and statement

The documentation

and

including

with,

have been complied

customs

Notwithstanding

any

other provision

of law,

into a blocked account in a U. S. financial

institution by an issuing or confirming bank under a standby
letter of credit in favor of a Kuwaiti beneficiary is
prohibited

by 8

the provisions

570. 201

of

8

been issued pursuant

and not

570. 503,

authorized,

if (i)

a

notwithstanding

specific license

has

to the provisions

of paragraph (b) of
10 business days have not expired

this section, or (ii)
after notice to the account party pursuant to paragraph (b)
of this section.
(2) Nothing in this section shall affect the
obligation of an issuing or confirming bank to make payment
into a blocked account

controlled

on

behalf of an entity

owned

or

of Kuwait pursuant to a standby
letter of credit if such entity is (i) licensed by the
Office of Foreign Assets Control to transact business with
U. S. persons, or (ii) listed in Appendix A to this part as
«Not Controlled/Not
Restricted" or "Controlled/Licensed to
Operate. "

by the Government

58

it is

above, provided

regulations

satisfied that all
assurances

of such hold harmless
appropriate.

will be forwarded

Control

for review

erformance

(a)(1)
payment

it

laws and

the execution

shall determine
received

to be
by

to the Office of Foreign Assets
appropriate action.

Customs

Section 570. 518

as

and statement

The documentation

and

including

with,

have been complied

customs

Certain standb

letters of credit

and

bonds.

Notwithstanding

any

other provision

of law,

into a blocked account in a U. S. financial

institution by an issuing or confirming bank under a standby
letter of credit in favor of a Kuwaiti beneficiary is
prohibited

by 8

the provisions

570. 201

and not

of 5 570. 503,

been issued pursuant

authorized,

if (i)

a

to the provisions

notwithstanding

specific license
of paragraph

has

(b) of

this section, or (ii) 10 business days have not expired
after notice to the account party pursuant to paragraph (b)
of this section.
(2) Nothing in this section shall affect the
obligation of an issuing or confirming bank to make payment
into a blocked account on behalf of an entity owned or
controlled by the Government of Kuwait pursuant to a standby
letter of credit if such entity is (i) licensed by the
Office of Foreign Assets Control to transact business with
U. S. persons, or (ii) listed in Appendix A to this part as
"Not Controlled/Not
Restricted" or "Controlled/Licensed to
Operate. "

(b) Whenever

receive such

of credit,

an issuing

for

demand

it

account party

payment

shall promptly
may

a blocked account on

of

payment

under

bank

shall

notify the account party.

The

five business days for
the account party to establish

its

a

books in the name of the Kuwaiti

in the amount payable under the credit,
by

letter

such a standby

then apply within

specific license authorizing
beneficiary

or confirming

the issuing or confirming

bank

in lieu

into a blocked

therefor by the account party.
Nothing in this section relieves any such bank or such
account party from giving any notice of defense against
that is required by applicable law.
payment or reimbursement
(c) Where there is outstanding a demand for payment
under a standby letter of credit, and the issuing or
account and reimbursement

confirming

bank has been enjoined

from making

payment,

upon

of the injunction, the account party may apply for a
specific license for the same purpose and in the same manner
as that set forth in paragraph (b) of this section. The
issuing or confirming bank shall not make payment under the
standby letter of credit unless (1) 10 business days have
expired since the bank has received notice of the removal of
the injunction and (2) a specific license issued to the
account party pursuant to the provisions of this paragraph
removal

to the bank.
(d) If necessary to assure the availability of
funds blocked, the Director of the Office of Foreign Assets
Control may at any time require the payment of the amounts
has not been presented

59

(b) Whenever

receive such

of credit,

it

an

demand

issuing or confirming

for

payment

shall promptly

under

bank

shall

such a standby

notify the account party.

letter
The

five business days for a
specific license authorizing the account party to establish
a blocked account on its books in the name of the Kuwaiti
beneficiary in the amount payable under the credit, in lieu
of payment by the issuing or confirming bank into a blocked

account party

may

then apply within

therefor by the account party.
Nothing in this section relieves any such bank or such
account party from giving any notice of defense against
that is required by applicable law.
payment or reimbursement
(c) Where there is outstanding a demand for payment
under a standby letter of credit, and the issuing or
account and reimbursement

confirming

bank has been enjoined

from making

payment,

upon

of the injunction, the account party may apply for a
specific license for the same purpose and in the same manner
as that set forth in paragraph (b) of this section. The
issuing or confirming bank shall not make payment under the
standby letter of credit unless (1) 10 business days have
expired since the bank has received notice of the removal of
the injunction and (2) a specific license issued to the
account party pursuant to the provisions of this paragraph
removal

to the bank.
(d) If necessary to assure the availability of the
funds blocked, the Director of the Office of Foreign Assets
Control may at any time require the payment of the amounts
has not been presented

60

due under

any

letter of credit described in

paragraph

(a) of

this section into a blocked account in a U. S. financial
institution or the supplying of any form of security deemed
necessary.
in this section precludes

(e) Nothing
on any standby

to

under

the standby

from a

letter of credit.
not affect the obligation of the

(f) This section does
various parties to the instruments

if

demand

or from raising any other legal defense

beneficiary

payment

other person from at

any

of the

the legality

contesting

any time

Kuwaiti

letter of credit or

the account party

the instruments

and payments

covered by this section

thereunder

are subsequently

unblocked.
any U. S. person

(g) The section does not authorize

reimburse

a non-U.

S.

bank

for

payment

to

to

a Kuwaiti

beneficiary under a standby letter of credit, except by
payments into a blocked account in accordance with 5 570. 503
or paragraph (b) or (c) of this section.
(h)

A

paragraph

specific license under
(b) or (c) of this section shall certify to the
person receiving

a

Office of Foreign Assets Control within 5 business days
after receipt of that license that it has established the
blocked account on

its

books as provided

in those

cases, this time period
to the Office of Foreign
may be extended upon application
Assets Control when the account party has filed a petition
paragraphs.

However,

in appropriate

60

due under

any

letter of credit described in

paragraph

(a) of

this section into a blocked account in a U. S. financial
institution or the supplying of any form of security deemed
necessary.
in this section precludes

(e) Nothing
on any standby

contesting

any time

Kuwaiti

to

letter of credit or

beneficiary
under

payment

the standby

the instruments

demand

from a

or from raising any other legal defense

letter of credit.
not affect the obligation of the

(f) This section does
various parties to the instruments

if

other person from at

any

of the

the legality

the account party

and payments

covered by this section

thereunder

are subsequently

unblocked.
any U. S. person

(g) The section does not authorize

reimburse

a non-U.

S.

bank

for

payment

to

to

a Kuwaiti

beneficiary under a standby letter of credit, except by
payments into a blocked account in accordance with 8 570. 503
or paragraph (b) or (c) of this section.
(h)

A

paragraph

specific license under
(b) or (c) of this section shall certify to the
person receiving

a

Office of Foreign Assets Control within 5 business days
after receipt of that license that it has established the
blocked account on

its

books as provided

in those

cases, this time period
may be extended upon application
to the Office of Foreign
Assets Control when the account party has filed a petition
paragraphs.

However,

in appropriate

61

court seeking a judicial order barring

with an appropriate
payment

by

the issuing or confirming

bank.

(i) For the purposes of this section, (1) the term
"standby letter of credit" shall mean a letter of credit
of, or

securing performance
payments

or deposits under,

of

repayment

a

any advance

contract, or

any

similar

obligation in the nature of a performance bond; (2) the term
"account party" shall mean the person for whose account the

letter of credit is

standby

"Kuwaiti beneficiary"

person in Kuwait,

(iii)

(ii)

Section 570. 519

Certain
ersonnel

All transactions

of

any goods

an

beneficiary

entity operated

im

that is (i) a

from Kuwait,

or

orts for di lomatic or

ordinarily

incident to the importation

or services into the United States destined
personal

employed

the recognized

authorized,

a

authorized.

official or
by

mean

(3) the term

and

of Kuwait.

the Government

official

shall

opened;

use by diplomatic
Government

unless the importation

and support

personnel

of Kuwait are

is otherwise prohibited

by law.

Donations of food to relieve
Section 570. 520
sufferin authorized.

for

human

court seeking a judicial order barring

with an appropriate
payment

the issuing or confirming bank.
For the purposes of this section,

by

(i)
"standby

letter of credit" shall
of, or

securing performance

mean

(1) the term
a letter of credit

of

repayment

any advance

or deposits under, a contract, or any similar
obligation in the nature of a performance bond; (2) the term
"account party" shall mean the person for whose account the

payments

letter of credit is

standby

"Kuwaiti beneficiary"

person in Kuwait,

(iii)

(ii)

Section 570. 519

Certain
ersonnel

All transactions

of

any goods

an

beneficiary

entity operated

im

that is (i) a

from Kuwait,

or

orts for di lomatic or

ordinarily

incident to the importation

or services into . the United States destined
personal

employed

the recognized

authorized,

a

authorized.

official or
by

mean

(3) the term

and

of Kuwait.

the Government

official

shall

opened;

use by diplomatic
Government

unless the importation

and support

personnel

of Kuwait are

is otherwise prohibited

by law.

Donations of food to relieve
Section 570. 520
sufferin authorized.

for

human

62

(a) Specific licenses

may

be issued on a case-by-case

to Kuwait of donated food
intended to relieve human suffering.
(b) In general, specific licenses will only be granted
for donations of food to be provided through the United

basis to permit exportation

Nations

in accordance with United Nations
661 and 666 and in cooperation

Resolutions

International
appropriate

of the

Committee

with the

or other

agencies for distribution

humanitarian

or under their supervision,
be approved

Red Cross

Security Council

or in such other manner as

666 and any other applicable

may

Security Council Resolution

Nations

under United

by them

Security Council resolutions,

in order to ensure that such donations

reach the intended

beneficiaries.
(c) Applications for specific licenses pursuant to
paragraph (a) shall be made in advance of the proposed
exportation, and provide the following information:
(1) the nature,
of the donated food;

quantity,

value,

and

the intended

conditions

use

and

(2) the terms and conditions

including

and intended

method

of distribution

of distribution,

of compliance with such terms
as

may

have been adopted

by

the United Nations Security Council or a duly authorized
body subordinate thereto to govern the shipment of

foodstuffs under applicable United Nations Security Council
resolutions, including Resolutions 661 and 666.

62

(a) Specific licenses

may

be issued on a case-by-case

basis to permit exportation to Kuwait of donated food
intended to relieve human suffering.
(b) In general, specific licenses will only be granted
of food to be provided through the United
Nations in accordance with United Nations Security Council
Resolutions 661 and 666 and in cooperation with the
International Committee of the Red Cross or other

for donations

agencies for distribution

humanitarian

appropriate

by them

or in such other manner as may
be approved under United Nations Security Council Resolution
666 and any other applicable Security Council resolutions,
in order to ensure that such donations reach the intended

or under their supervision,

beneficiaries.
(c) Applications for specific licenses pursuant to
paragraph (a) shall be made in advance of the proposed
exportation,

the following

and provide

(1) the nature,
of the donated food;

quantity,

value,

and

the intended

conditions

and intended

use

and

(2) the terms and conditions

including

information:

method

of distribution

of distribution,

of compliance with such terms
as

may

have been adopted

by

the United Nations Security Council or a duly authorized

thereto to govern the shipment of
foodstuffs under applicable United Nations Security Council
resolutions, including Resolutions 661 and 666.

body subordinate

63

Section 570. 521

Certain ex ortations

of medical su

lies

authorized.
(a) Specific licenses

may

be issued

on a

case-by-case

basis to permit exportation to Kuwait of supplies intended
strictly for medical purposes, in accordance with the
provisions of United Nations Security Council Resolutions
661 and 666, and other applicable

Security Council

resolutions.
(b)

In general,

specific licenses will only

be granted

for the exportation of medical supplies through the
International Committee of the Red Cross or other
appropriate humanitarian agencies for distribution by them
or under their supervision, or in such other manner as may
be approved under applicable Security Council resolutions,
in order to ensure that such supplies reach the intended
recipient.
(c) Applications for specific licenses pursuant to
paragraph (a) shall be made in advance of the proposed
exportation, and provide the following information:
(1) the nature, quantity, value, and intended use
of the medical supplies;
(2) the terms and conditions of distribution
including the intended method of compliance with such terms
as may have been adopted by
and conditions of distribution
the United Nations Security Council or a duly authorized

63

Section 570. 521

Certain ex ortations

of medical su

lies

authorized.
(a) Specific licenses

may

be issued on a case-by-case

basis to permit exportation to Kuwait of supplies intended
strictly for medical purposes, in accordance with the
provisions of United Nations Security Council Resolutions
661 and 666, and other applicable Security Council
resolutions.
(b)

In general,

specific licenses will only

be granted

for the exportation of medical supplies through the
International Committee of the Red Cross or other
appropriate humanitarian agencies for distribution by them
or under their supervision, or in such other manner as may
be approved under applicable Security Council resolutions,
in order to ensure that such supplies reach the- intended
recipient.
(c) Applications for specific licenses pursuant to
(a) shall be

paragraph

exportation,

made

and provide

(1) the nature,
of the medical supplies;

in advance

the following

quantity,

and

the intended

conditions

method

of distribution

information:

value,

(2) the terms and conditions

including

of the proposed
and intended

use

of distribution,

of compliance with such terms
as

may

have been adopted

the United Nations Security Council or a duly authorized

by

64

thereto to govern the shipment of medical
supplies under applicable Security Council resolutions.

body subordinate

Subpart

F

--

Reports

Section 570. 601

Re

ired records.

Every person engaging

in any transaction

subject to the
accurate

of this part shall keep a full and
record of each such transaction in which that person

provisions
engages,

of whether such transaction

regardless

is effected

to license or otherwise, and such record shall be
available for examination for at least 2 years after the
date of such transaction.

pursuant

Section 570. 602
Every person

Re

orts to be furnished

is required to furnish

of reports or otherwise,

on demand.

under

oath, in the

to time and at any
time as may be required, complete information relative to
regardless of whether such transaction is
any transaction,
effected pursuant to license or otherwise, subject to the
provisions of this part. Such reports may be required to
include the production of any books of account, contracts,
letters or other papers, connected with any such transaction
form

from time

64

thereto to govern the shipment of medical
supplies under applicable Security Council resolutions.

body subordinate

Subpart

F

--

Reports

Section 570. 601

Re

ired records.

Every person engaging

in any transaction

subject to the
accurate

of this part shall keep a full and
record of each such transaction in which that person
engages, regardless of whether such transaction is effected

provisions

to license or otherwise, and such record shall be
available for examination for at least 2 years after the
date of such transaction.

pursuant

Section 570. 602
Every person

Re

orts to be furnished

is required to furnish

on demand.

under

oath, in the

to time and at any
time as may be required, complete information relative to
regardless of whether such transaction is
any transaction,
effected pursuant to license or otherwise, subject to the
provisions of this part. Such reports may be required to
include the production of any books of account, contracts,
form

of reports or otherwise,

letters or other papers,

from time

connected with any such transaction

65

or property,

in the custody or control of the person

to

make

transactions

may

transactions

are completed.

required

be required

Control may, through

Reports with respect to

reports.

such

either before or after such
The Director of Foreign Assets

any person

or agency, conduct

investigations, hold hearings, administer oaths, examine
witnesses, receive evidence, take depositions, and require
by subpoena

the attendance

of witnesses

and testimony

and

of all books, papers, and documents relating
matter under investigation,
regardless of whether any

the production

to

any

or filed in connection

report has been required

Section 570. 603
accounts.

Re

ort

on

(a) U. S. financial
monthly

certain corres ondent

institutions

report concerning

therewith.
bank

are required

any bank account

to file

a

held by them in

of a bank in which the Government of Kuwait holds
an equity interest of 10: or more (i. e. , a correspondent
bank account).
(b) The report, consisting of a copy of a monthly bank
the

name

for the account,

(1) include a summary of the
average balance in the account for the period covered by the
report, (2) list the actual date on which account statements
are made available to account holders, and (3) state the
statement

exact location at

which

credits to the account

must

documents
may

showing

be reviewed

and

debits
the

from and

name

and

65

or property,

to
transactions
transactions
required

in the custody or control of the person
make
may

be required

are completed.

Control may, through

Reports with respect to

reports.

such

either before or after such
The Director of Foreign Assets

any person

or agency, conduct

investigations, hold hearings, administer oaths, examine
witnesses, receive evidence, take depositions, and require
by subpoena

the attendance

of witnesses

and testimony

and

of all books, papers, and documents relating
matter under investigation,
regardless of whether any

the production

to

any

or filed in connection

report has been required
Section 570. 603
accounts.

Re

ort

on

(a) U. S. financial
monthly

certain corres ondent

institutions

report concerning

therewith.

are required

any bank account

bank

to file

a

held by them in

of a bank in which the Government of Kuwait holds
an equity interest of 10: or more (i. e. , a correspondent
bank account).
(b) The report, consisting of a copy of a monthly bank
the

name

for the account,

(1) include a summary of the
average balance in the account for the period covered by the
report, (2) list the actual date on which account statements
are made available to account holders, and (3) state the
statement

exact location at

which

credits to the account

must

documents
may

showing

be reviewed

and

debits

from and

the

and

name

66

telephone

of a person responsible

number

the report.

(The

for the content of

report should not include copies of

credits. )
report filed pursuant to this section

documents

showing

debits

and

(c) A
at the Office of Foreign Assets Control,

must

Compliance

arrive

Section,

later than the last business day of the month following
the activity summarized in the report. The report may be
sent by facsimile to (202) 377-7222 or mailed to the

no

address:

following

Compliance

Unit

—

603

Office of Foreign Assets Control
U. S. Department of the Treasury
1500 Pennsylvania
Washington,

Subpart

G

--

D. C.

Avenue,

N. W.

--

2131

Annex

20220-

Penalties

Section 570. 701 Penalties.
(a) Section 586E of the Iraq Sanctions Act of 1990,
contained in the Foreign Operations Authorization and
Appropriation

Act of 1990, dated November

5, 1990, 104 Stat.

1979, provides that:
Notwithstanding
Emergency

section 206 of the International

Economic Powers Act (50 U. S. C. 1705) and

66

telephone

the report.

for the content of

of a person responsible

number

(The

report should not include copies of

credits. )
report filed pursuant to this section

documents

showing

debits

and

must arrive
(c) A
at the Office of Foreign Assets Control, Compliance Section,
no later than the last business day of the month following

the activity

summarized

in the report.

The

report

may

be

sent by facsimile to (202) 377-7222 or mailed to the

address:

following

Compliance

Unit

—

603

Office of Foreign Assets Control
U. S. Department of the Treasury
1500 Pennsylvania
Washington,

Subpart

G

--

D. C.

Avenue,

N. W.

--

2131

Annex

20220.

Penalties

Section 570. 701 Penalties.
(a) Section 586E of the Iraq Sanctions Act of 1990,

contained

in the Foreign Operations

Appropriation

Authorization

Act of 1990, dated November

and

5, 1990, 104 Stat.

1979, provides that:
Notwithstanding
Emergency

section 206 of the International

Economic Powers Act (50 U. S. C. 1705) and

67

section 5(b) of the United Nations Participation
1945 (22 U. S. C.

(1)

A

be imposed

Act of

287c(b))--

civil penalty of not to exceed $250, 000 may
on any person who, after the enactment of

this Act, violates or evades or attempts to violate or
evade Executive Order Number

12722, 12723, 12724,

12725, or any license, order, or regulation
under

such Executive

issued

Order;

(2) Whoever after the date of enactment

of the

Iraq Sanctions Act of 1990 willfully violates or evades
or attempts to violate or evade Executive Order Number
12722, 12723, 12724, or 12725 or any license,

regulation

order, or

issued under any such Executive Order--

(i) shall,

conviction,

upon

if a person
(ii) if a natural

$1, 000, 000

be fined not more than

other than a natural
person,

shall

upon

conviction,

be fined not more than $1, 000, 000 be imprisoned
more than
Any

12 years,

attempt

participates
described

imposition

in a violation,

in paragraph

specified in subparagraph

provides:

agent of any corporation

(a)

(a)(2)(ii)

is directed to

evasion,

may

of the fine, imprisonment

(b) Attention

for not

or both.

officer, director, or

knowingly

or

person;

who

or

be punished

by

(or both)
of that paragraph.

18 U. S. C. 1001, which

67

section 5(b) of the United Nations Participation

Act of

1945 (22 U. S. C. 287c(b))--

(1)

A

be imposed

civil penalty of not to exceed $250, 000 may
on any person who, after the enactment of

this Act, violates or evades or attempts to violate or
evade Executive Order Number

12722, 12723, 12724,

12725, or any license, order, or regulation
under

issued

such Executive Order;

after the date of

(2) Whoever

enactment

of the

Iraq Sanctions Act of 1990 willfully violates or evades
or attempts to violate or evade Executive Order Number
12722, 12723, 12724, or 12725 or any license,

regulation

order, or
issued under any such Executive Order--

(i) shall,

conviction,

upon

if a person
(ii) if a natural

$1, 000, 000

be fined not more than

other than a natural
person,

shall

upon

conviction,

be fined not more than $1, 000, 000 be imprisoned
more than
Any

12 years,

attempt

participates
described

imposition

in a violation,

in paragraph

specified in subparagraph

provides:

agent of any corporation

(a)

(a)(2)(ii)

is directed to

18 U. S

evasion,

may

of the fine, imprisonment

(b) Attention

for not

or both.

officer, director, or

knowingly

or

person;

who

or

be punished

by

(or both)
of that paragraph.

AC.

1001, which

68

Whoever,

department

willfully

the jurisdiction

in any matter within

of

or agency of the United States knowingly
falsifies, conceals or covers up by anY

trick, scheme, or device a material fact, or makes
false, fictitious or fraudulent statements or
or makes or uses any false writing

representation
document

any

knowing

the

same

fictitious or fraudulent

to contain
statement

any

any

or

false,

or entry,

fined not more than $10, 000 or imprisoned

and

shall be

not more than

five years, or both.

(c) Violations of this part may also be subject to
relevant provisions of the Customs laws and other applicable
laws.

Section 570. 702
(a)

When

re

Pre enalt

ired:

If

notice.
the Director of the Office of

Foreign Assets Control has reasonable

cause to believe that

there has occurred a violation

provision

of this part
or a violation of the provisions of any license, ruling,
regulation, order, direction or instruction issued by or
pursuant to the direction or authorization of the Secretary
of the Treasury pursuant to this part or otherwise under the
International Emergency Economic Powers Act, and the
Director determines that further proceedings are warranted,
he shall issue to the person concerned a notice of his
of

any

68

Whoever,

department

willfully

the jurisdiction

in any matter within

of

or agency of the United States knowingly
falsifies, conceals or covers up by any

trick, scheme, or device a material fact, or makes
false, fictitious or fraudulent statements or
or makes or uses any false writing

representation
document

any

knowing

the

same

fictitious or fraudulent

to contain

any

fined not more than $10, 000 or imprisoned

any

or

false,

or entry,

statement

and

shall be

not more than

five years, or both.
(c) Violations
relevant provisions

of this part

may

also be subject to

of the Customs laws

and

other applicable

laws.

Section 570. 702
(a)

When

re

Pre enalt

ired:

If

notice.
the Director of the Office of

Foreign Assets Control has reasonable

cause to believe that

there has occurred a violation

provision

of this part
or a violation of the provisions of any license, ruling,
regulation, order, direction or instruction issued by or
pursuant to the direction or authorization of the Secretary
of the Treasury pursuant to this part or otherwise under the
International Emergency Economic Powers Act, and the
Director determines that further proceedings are warranted,

he shall

of

any

issue to the person concerned a notice of his

69

intent to impose a monetary penalty. The prepenalty notice
shall be issued whether or not another agency has taken any
action with respect to this matter.
(b) Contents.
The prepenalty notice
(1) Facts of violation.
shall describe the violation, specify the laws and regulations allegedly violated, and state the amount of the

proposed

monetary

penalty.

(2) Ri ht to make

resentations.
The prepenalty
notice also shall inform the person of his right to make a
written presentation within 30 days of mailing of the notice
as to

why

imposed,

a monetary
why

it

Section 570. 703

penalty

should

should

be in a

Presentation

not be imposed,

lesser

amount

res ondin

to

or,

if

than proposed.

re enalt

notice.
(a) Time within which to res ond. The named person
shall have 30 days from the date of mailing of the

prepenalty

notice to

make

a written

presentation

to the

Director.
resentation.
The
written presentation need not be in any particular form, but
shall contain information sufficient to indicate that it is
in response to the prepenalty notice. It should contain
of written

(b) Form and contents

responses

to the allegations

set forth the reasons

why

in the prepenalty

notice

and

the person believes the penalty

69

intent to impose a monetary penalty. The prepenalty notice
shall be issued whether or not another agency has taken any
action with respect to this matter.
(b) Contents.
The prepenalty notice
(1) Facts of violation.
shall describe the violation, specify the laws and regulations allegedly violated, and state the amount of the

proposed

monetary

penalty.

(2) Ri ht to

resentations.
The prepenalty
notice also shall inform the person of his right to make a
written presentation within 30 days of mailing of the notice
as to

why

imposed,

a monetary
why

it

Section 570. 703

make

penalty

should

should

be in a

Presentation

not be imposed,

lesser

amount

res ondin

to

or,

if

than proposed.

re enalt

notice.
(a) Time within which to res one The named person
shall have 30 days from the date of mailing of the

prepenalty

notice to

make

a written

presentation

to the

Director.
of written

resentation.
The
written presentation need not be in any particular form, but
shall contain information sufficient to indicate that it is
in response to the prepenalty notice. It should contain
(b) Form and contents

responses

to the allegations

set forth the reasons

why

in the prepenalty

notice

and

the person believes the penalty

70

should

not be imposed or,

lesser

amount

No

imposed,

it

why

should be in a

than proposed.

Section 570. 704
(a)

if

Penalt

notice.

If, after

violation.

considering

any

to the prepenalty notice and
any relevant facts, the Director determines that there was
notice,
no violation by the person named in the prepenalty
he promptly shall notify the person in writing of that
determination and that no monetary penalty will be imposed.

presentations

made

(b) Violation.

in response

If, after

considering

any

presentations

to the prepenalty notice, the Director
determines that there was a violation by the person named in
the prepenalty notice, he promptly shall issue a written
notice of the imposition of the monetary penalty to that

made

in response

person.

Section 570. 705 Referral to United States

De

artment

of

Justice.
In the event that the person

named

does not pay the

to this subpart or make payment
acceptable to the Director within 30 days of
arrangements
the mailing of the written notice of the imposition of the
penalty, the matter shall be referred to the United States

penalty

imposed

pursuant

70

should

not be imposed or,

lesser

amount

No

imposed,

why

it

should

be in a

than proposed.

Section 570. 704
(a)

if

Penalt

violation.

notice.

If, after

considering

any

to the prepenalty notice and
any relevant facts, the Director determines that there was
notice,
no violation by the person named in the prepenalty
he promptly shall notify the person in writing of that
determination and that no monetary penalty will be imposed.
If, after considering any presentations
(b) Violation.
made in response to the prepenalty
notice, the Director
determines that there was a violation by the person named in
the prepenalty notice, he promptly shall issue a written
notice of the imposition of the monetary penalty to that

presentations

made

in response

person.

Section 570. 705 Referral to United States

De

artment

of

Justice.
In the event that the person

named

does not pay the

to this subpart or make payment
acceptable to the Director within 30 days of
arrangements
the mailing of the written notice of the imposition of the
penalty, the matter shall be referred to the United States

penalty

imposed

pursuant,

71

penalty

of Justice for appropriate action to recover the
in a civil suit in a Federal district court.

Subpart

H

Department

--

Procedures

(a) General

licenses.

issued authorizing

under

General

appropriate

licenses have been
terms and conditions

certain types of transactions which are subject to the
prohibitions contained in Subpart B of this part. All such
licenses in effect on the date of publication 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 may
be required to file reports and statements in accordance
with the instructions specified in those licenses.
Failure
to file such reports or statements will nullify the
authority of the general license.
(b) S ecific licenses.
(1) General course of rocedure. Transactions
subject to the prohibitions contained in Subpart B of this
part which are not authorized by general license may be

effected only

under

specific licenses.

71

penalty

of Justice for appropriate action to recover the
in a civil suit in a Federal district court.

Subpart

H

Department

--

Procedures

(a) General

licenses.

issued authorizing

under

General

appropriate

licenses have been
terms and conditions

certain types of transactions which are subject to the
prohibitions contained in Subpart B of this part. All such
licenses in effect on the date of publication 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 may
be required to file reports and statements in accordance
Failure
with the instructions specified in those licenses.
to file such reports or statements will nullify the
authority of the general license.
(b) S ecific licenses.
(1) General course of rocedure. Transactions
subject to the prohibitions contained in Subpart B of this
part which are not authorized by general license may be

effected only

under

specific licenses.

72

(2)

Applications

transactions

filed

by

lications for s ecific licenses.
for specific licenses to engage in any
prohibited by or pursuant to this part
A

letter or

on an

Foreign Assets Control.

transaction

application
Any

form with the

person having

or proposed transaction

may

be

Office of

interest in

an

file

may

an

a

application

for a license authorizing such transaction, but the
applicant for a specific license is required to make full
disclosure of all parties in interest to the transaction so
that a decision on the application may be made with full
knowledge of all relevant facts and so that the identity and
location of the persons who know about the transaction may
be easily ascertained in the event of inquiry.
(3) Information to be su lied. The applicant
must supply all information specified by relevant
instructions and/or forms, and must fully disclose the names
of all the parties who are concerned with or interested in
the proposed transaction.
If the application is filed by an
agent, the agent must disclose the name of his principal(s).
Such documents as may 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. Applicants may be required to furnish such
further information as is deemed necessary to a proper
determination by the Office of Foreign Assets Control.
an

applicant

or other party in interest

If

desires to present

72

(2)

Applications

transactions

filed

by

lications for s ecific licenses.
for specific licenses to engage in any
prohibited by or pursuant to this part
A

letter or

on an

Foreign Assets Control.

transaction

for

application
Any

form with the

person having

or proposed transaction

may

be

Office of

interest in

an

file

may

an

a

application

license authorizing such transaction, but the
applicant for a specific license is required to make full
disclosure of all parties in interest to the transaction so
that a decision on the application may be made with full
knowledge of all relevant facts and so that the identity and
location of the persons who know about the transaction may
be easily ascertained in the event of inquiry.
(3) Information to be su lied. The applicant
must supply all information specified by relevant
instructions and/or forms, and must fully disclose the names
of all the parties who are concerned with or interested in
the proposed transaction.
If the application is filed by an
agent, the agent must disclose the name of his principal (s) .
Such documents as may 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
a

Control may, where appropriate,

be incorporated

by

reference. Applicants may be required to furnish such
further information as is deemed necessary to a proper
determination by the Office of Foreign Assets Control.
an

applicant

or other party in interest

If

desires to present

73

additional

information

he may do so

Arrangements

or discuss or argue the application,

at any time before or after decision.
for oral presentation should be made with the

Office of Foreign Assets Control.
(4) Effect of denial.
does not preclude

filing of

the reopening

denial of a license

The

of

an

application

or the

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) Re orts under s

ecific licenses.

As a

for the issuance of any license, 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 license. Licenses will be issued
by the Office of Foreign Assets Control acting on behalf of
the Secretary of the Treasury or licenses may be issued by
the Secretary of the Treasury acting directly or through any
condition

specifically designated

person,

agency,

or instrumentality.

(c) Address. License applications, reports, and
inquiries should be addressed to the appropriate section or
individual within the Office of Foreign Assets Control, or

to its Director, at the following address:
Office of Foreign Assets Control
U. S. Department

1500 Pennsylvania

of the Treasury
Avenue,

N. W. , Annex

73

additional

information

he may do so

Arrangements

or discuss or argue the application,

at any time before or after decision.
for oral presentation should be made with the

Office of Foreign Assets Control.
(4) Effect of denial.
does not preclude

filing of

the reopening

denial of a license

The

of

an

application

or the

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) Re orts under s

ecific licenses.

As a

for the issuance of any license, 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 license. Licenses will be issued
by the Office of Foreign Assets Control acting on behalf of
the Secretary of the Treasury or licenses may be issued by
the Secretary of the Treasury acting directly or through any
condition

specifically designated

person,

agency,

or instrumentality.

(c) Address. License applications, reports, and
inquiries should be addressed to the appropriate section or
individual within the Office of Foreign Assets Control, or

to its Director, at the following address:
Office of Foreign Assets Control
U. S. Department

1500 Pennsylvania

of the Treasury
Avenue,

N

W. , Annex

74

Washington,

Section 570. 802

D. C. 20220.

Decisions.

Office of Foreign Assets Control will advise each
applicant of the decision respecting filed applications.
The decision of the Office of Foreign Assets Control acting
The

on

behalf of the Secretary of the Treasury with respect to

an

application

Section 570. 803

shall constitute
Amendment

final agency action.

modification

or revocation.

of this part and any rulings, licenses,
instructions,
whether general or specific, authorizations,
The

provisions

orders, or forms issued hereunder
or revoked at any time.

may

be amended,

modified,

(a) All rules and other public documents are issued by
the Secretary of the Treasury upon recommendation of the

Director of the Office of Foreign Assets Control. In
general, rulemaking by the Office of Foreign Assets Control
involves

foreign affairs functions

for that reason is
Administrative
proposed

exempt

Procedure

rulemaking,

of the United States,

from the requirements

under

the

Act (5 U. S. C. 553) for notice of

opportunity

for public

comment,

and

and

74

Washington,

Section 570. 802

D. C. 20220.

Decisions.

Office of Foreign Assets Control will advise each
applicant of the decision respecting filed applications.
The

The

decision of the Office of Foreign Assets Control acting

on

behalf of the Secretary of the Treasury with respect to

an

application

Section 570. 803

shall constitute
Amendment

final agency action.

modification

of this part

or revocation.

rulings, licenses,
whether general or specific, authorizations,
instructions,
orders, or forms issued hereunder may be amended, modified,
or revoked at any time.
The

provisions

and any

(a) All rules and other public documents are issued by
the Secretary of the Treasury upon recommendation of the
Director of the Office of Foreign Assets Control. In

general,
involves

the Office of Foreign Assets Control
foreign affairs functions of the United States, and

rulemaking

for that reason is
Administrative
proposed

by

exempt

Procedure

rulemaking,

from the requirements

under

the

Act (5 U. S. C. 553) for notice of

opportunity

for public

comment,

and

75

delay in effective date.

possible,

Wherever

however,

it is

the practice of the Office of Foreign Assets Control to

receive written submissions or hold informal consultations
with interested parties before the issuance of any rule or
other public document.

petition the Director of
the Office of Foreign Assets Control in writing for the
issuance, amendment, or repeal of any rule.
(b)

Any

interested

person

Section 570. 805 Dele ation

b

may

the Secretar

of the

action which the Secretary of the Treasury is
authorized to take pursuant to Executive Order No. 12723
Executive Order No. 12725 may be taken by the Director,
Any

and

Office of Foreign Assets Control, or by any other person to
authority
whom the Secretary of the Treasury has delegated
so to

act.

Section 570. 806 Rules

availabilit

overnin

of

information.

(a) The records of the Office of Foreign Assets Control
which are required by 5 U. S. C. 552 to be made available to

the public shall be

definitions,
provisions

made

procedures,

available
payment

of the regulations

on

in accordance with the

of fees,

and

the Disclosure

other

of Records

75

delay in effective date.

possible,

Wherever

however,

it is

the practice of the Office of Foreign Assets Control to

receive written submissions or hold informal consultations
with interested parties before the issuance of any rule or
other public document.
interested

petition the Director of
the Office of Foreign Assets Control in writing for the
issuance, amendment, or repeal of any rule.
(b)

Any

person

Section 570. 805 Dele ation

may

the Secretar

b

of the

action which the Secretary of the Treasury is
authorized to take pursuant to Executive Order No. 12723
Any

Executive Order No. 12725

may

and

be taken by the Director,

Office of Foreign Assets Control, or by any other person to
authority
whom the Secretary of the Treasury has delegated
so to

act.

Section 570. 806 Rules

availabilit

overnin

of

information.
(a) The records of the Office of Foreign Assets Control
which

are required

the public shall be

definitions,
provisions

by 5 U. S. C. 552
made

procedures,

available
payment

of the regulations

on

to

be made available

to

in accordance with the

of fees,

and

the Disclosure

other

of Records

76

of the Office of the Secretary

offices of the

and

of other bureaus

and

issued under 5 U. S. C. 552 and

Department

as Part 1 of this Title 31 of the Code of Federal

published

Regulations.
(b)
Kuwaiti

or

by

Assets Control Regulations

writing

Department
Annex,

Sub

for use in connection with the

form issued

Any

may

of the Treasury,

1500 Pennsylvania

D. C. 20220, or by

--

Reduction

Pa erwork

Section 570. 901
APPENDIX

The Treasury

in person
U. S.

to the Office of Foreign Assets Control,

Washington,

art I

be obtained

calling

Avenue,

N. W. ,

(202) 566-2701.

Act

[Reserved].

A TO

PART 570--KUWAITI

Department

various

entities in

Kuwaiti

nationals

ENTITIES

has been asked about the status

which

may

GOVERNMENTAL

the Government

have an

interest

Executive Order Nos. 12722-12725.

of Kuwait or
for purposes of

Based on information

available

to the Office of Foreign Assets Control, the

following

lists

The

have been compiled.

entities listed as "Controlled/Blocked"

determined
and/or

blocked

to be controlled

the Government

entities.

have been

by the Government

of Iraq

and should

of Kuwait

be regarded

This means U. S. persons

as

are prohibited

of

76

of the Office of the Secretary

offices of the

and

of other bureaus

5 U. S. C. 552 and

issued under

Department

and

as Part 1 of this Title 31 of the Code of Federal

published

Regulations.
(b)
Kuwaiti

or

by

Any

Assets Control Regulations

writing

Department
Annex,

Sub

for use in connection with the

form issued

be obtained

in person
U. S.

to the Office of Foreign Assets Control,

of the Treasury,

1500 Pennsylvania

or by calling

D. C. 20220,

Washington,

art I --

may

Pa erwork

Reduction

Avenue,

N. W. ,

(202) 566-2701.

Act

Section 570. 901 [Reserved].
APPENDIX

The Treasury

A TO PART

Department

various

entities in

Kuwaiti

nationals

570--KUWAITI

ENTITIES

has been asked about the status

which

may

GOVERNMENTAL

the Government

have an

of Kuwait or

interest for purposes of

Executive Order Nos. 12722-12725.

Based on information

available

to the Office of Foreign Assets Control, the

following

lists

have been compiled.

entities listed as "Controlled/Blocked" have
determined to be controlled by the Government of
The

and/or

blocked

the Government

entities.

of Iraq

and should

been
Kuwait

be regarded

This means U. S. persons

as

are prohibited

of

77

from engaging

assets under

in transactions
U. S.

jurisdiction owned or
entities are blocked. U. S. persons are
however, from paying funds owed to these
blocked accounts held in U. S. financial
The

entities

with these

controlled

and
by

all
those

not prohibited,

entities into
institutions.

entities listed as "Controlled/Licensed

to Operate"

also be regarded as controlled by the Government of
Kuwait, but as licensed to operate.
This means the Office
of Foreign Assets Control has determined that the entities
are under the effective control of the recognized Government
of Kuwait and U. S. persons are authorized to engage in
transactions with them. These authorized transactions
include entering into contracts, making and receiving
payments, and conducting other commercial or financial
transactions.
If questions arise, U. S. persons should
request from the entities concerned to see copies of the
should

operating
The

licenses.

entities listed as

Restrictions" are

Office of Foreign Assets Control as
the Government of Kuwait. The names of these

by the

not regarded

controlled

"Not Controlled/No

by

entities appear on the list solely for the purpose of
clarification because requests regarding their status
Some of the entities on this list may
been received.
subject to special Treasury Department licensing or
reporting

requirements.

have

be

77

in transactions

from engaging

assets under

U. S.

with these

jurisdiction

entities are blocked.

owned

U. S. persons

entities

or controlled

and
by

all
those

are not prohibited,

to these entities into
blocked accounts held in U. S. financial institutions.

however,

The

from paying

funds

owed

entities listed as "Controlled/Licensed

to Operate"

also be regarded as controlled by the Government of
Kuwait, but as licensed to operate.
This means the Office
of Foreign Assets Control has determined that the entities
are under the effective control of the recognized Government
should

of Kuwait and U. S. persons are authorized to engage in
transactions with them. These authorized transactions
include entering into contracts, making and receiving
payments, and conducting other commercial or financial
transactions.
If questions arise, U. S. persons should

entities concerned to see copies of the
operating licenses.
request

The

from the

entities listed as

not regarded

controlled

by
by

"Not Controlled/No

Restrictions" are

the Office of Foreign Assets Control as

the Government

of Kuwait.

The names

of these

entities appear on the list solely for the purpose of
clarification because requests regarding their status
Some of the entities on this list may
been received.
subject to special Treasury Department licensing or
reporting

requirements.

have

be

78

1'

1'1

information

become

t

tj t t

available,

and

'

'

1 11

are not inclusive.

to the lists are anticipated.
The absence of a
'particular entity from any of the lists should not be
regarded as indicative of whether the entity is owned or
Additions

controlled

by

the Government

of Kuwait or the

Government

of

Iraq.
Controlled

Blocked

AlAhli Bank of Kuwait
A1Ahlia Insurance Company
Arab Fund for Economic and

Social

Arab Trust Company
Bahrain Arab International
Bank
Bank of Kuwait & Middle East
Burgan Bank
Central Bank of Kuwait
Commercial Bank of Kuwait
Commercial Facilities Company
The Gulf Bank

Gulf Insurance

Development

Company

Industrial Bank of Kuwait
International Financial Advisor

KREIC

Singapore

Kuwait Cement Company
Kuwait Clearing Company
Kuwait Finance House
Kuwait Hotels Company
Kuwait Metal Pipe Industries Company
Kuwait Real Estate Bank
Kuwait Real Estate Investment Consortium
(KREIC)
Kuwait Reinsurance Company
Kuwait Supply Company
Kuwait United Poultry Company

Mobile Telephone Systems
Mubarakiah Poultry and Feed Company
National Industries Company K. S. C.
National Real Estate Company
Public Warehousing Company
Rawdatain Water Bottling Company

Refrigeration

Industries

Savings and Credit Bank

Securities
Securities

Group Company
House Company

Company

78

1h,
information

1'

become

t

t

bj

available,

and

'

'

h

1d

are not inclusive.

The absence of a
to the lists are anticipated.
'particular entity from any of the lists should not be
regarded as indicative of whether the entity is owned or

Additions

controlled

by

of Kuwait or the Government

the Government

of

Iraq.
Controlled

Blocked

A1Ahli Bank of Kuwait
A1Ahlia Insurance Company
Arab Fund for Economic and Social Development
Arab Trust Company
Bahrain Arab International
Bank
Bank of Kuwait & Middle East
Burgan Bank
Central Bank of Kuwait
Commercial Bank of Kuwait
Commercial Facilities Company
The Gulf Bank

Gulf Insurance

Company

Industrial Bank of Kuwait
International Financial Advisor

KREIC

Singapore

Kuwait Cement Company
Kuwait Clearing Company
Kuwait Finance House
Kuwait Hotels Company
Kuwait Metal Pipe Industries Company
Kuwait Real Estate Bank
Kuwait Real Estate Investment Consortium
(KREIC)
Kuwait Reinsurance Company
Kuwait Supply Company
Kuwait United Poultry Company
Mobile Telephone Systems
Mubarakiah Poultry and Feed Company
National Industries Company K. S. C.

National Real Estate Company
Public Warehousing Company
Rawdatain

Savings and

Securities
Securities

Bottling
Industries
Credit Bank

Water

Refrigeration

Group Company
House Company

Company
Company

79

United Fisheries of Kuwait
United Realty Company
Univest Invest Company
Warba Insurance Company

Licensed to 0 crate

Controlled

Credit des Bergues
Industries, Inc. (including
subsidiaries)
KFIC, Inc. (including subsidiaries)

Georgetown

Kuwait Airways Corporation
Kuwait Asia Bank
Kuwait Investment Office (including

entities)

controlled

Kuwait Investment Authority
Kuwait Maritime Transport Company
Kuwait & Middle East Financial Investment
Company

Kuwait

Petroleum

Corporation

Kuwait

Petroleum

— North

(London)

licensed affiliates)

(including

Sea Holdings

Ltd'

(including subsidiaries)
Santa Fe International Corporation (including
subsidiaries and affiliates)
Wafra Intervest Corporation (Cayman)
(including subsidiaries and affiliates)
Not Controlled

No

Restrictions
be subject to special

of these entities may
Treasury Department licensing/reporting
requirements. ]
Alexandria Kuwait International
Bank
Arab African International
Bank
[Some

Arab
Arab
Arab
Arab
Arab
Arab
Arab
Arab

Corporation
Financial Services
Hellenic Bank
Banking

Insurance

Maritime
Mining

Group

Petroleum

Company

Company

Transport

Petroleum Investments Corporation
Turkish Bank
Bahrain Islamic Bank
Bahrain Islamic Investment Company
Bahrain Middle East Bank
Banco Arabe Espanol
Banco Atlantico
Bank of Bahrain and Kuwait
Bank of Oman, Bahrain & Kuwait
CHENI

Dao Heng
FRAB Bank

Bank

International

79

United Fisheries of Kuwait
United Realty Company
Univest Invest Company
Warba Insurance Company

Licensed to 0 crate

Controlled

Credit des Bergues
Industries, Inc. (including
subsidiaries)
KFIC, Inc. (including subsidiaries)

Georgetown

Kuwait Airways Corporation
Kuwait Asia Bank
Kuwait Investment Office (including

entities)

controlled

Kuwait Investment Authority
Kuwait Maritime Transport Company
Kuwait & Middle East Financial Investment
Company

Kuwait

Petroleum

Corporation

Kuwait

Petroleum

— North

(London)

licensed affiliates)

(including

Sea Holdings

(including subsidiaries)
Santa Fe International Corporation

Ltd'

(including

subsidiaries and affiliates)
Wafra Intervest Corporation (Cayman)
(including subsidiaries and affiliates)
Not Controlled

[Some

No

Restrictions
be subject to special

of t hese entities may
Department licensing/reporting
requirements.
Alexandria Kuwait International
Bank
Arab African International
Bank

Treasury

Arab
Arab
Arab
Arab
Arab
Arab
Arab
Arab

Corporation
Financial Services
Hellenic Bank
Banking

Insurance

Maritime
Mining

Group

Petroleum

Company

Company

Transport

Petroleum Investments Corporation
Turkish Bank
Bahrain Islamic Bank
Bahrain Islamic Investment Company
Bahrain Middle East Bank
Banco Arabe Espanol
Banco Atlantico
Bank of Bahrain and Kuwait
Bank of Oman, Bahrain & Kuwait
CHENI

Dao Heng
FRAB Bank

Bank

International

]

80

Bank
Gulf International
Gulf Investment Corporation
Independent Petroleum Group

Interna ional Contracting Group
Jordan Fertilizer Industry Company
Jordan Kuwait Bank
Korea Kuwait Banking Corporation

t

French Bank
Kuwait Investment Projects Company
Kuwait Lebanon Bank
Kuwait National Cinema Company
National Bank of Kuwait

Kuwa'.

Investment

National

Housing

Oman

Pearl Holding

Company

Bank
Company

Swiss Kuwaiti Bank
The Arab Investment

Company

American Bank
Arab Shipping Company
Bank of Kuwait
Gulf Bank
Kuwait Bank

UBAF Arab

United
United
United
Yemen

Dated:

Z

November

R. Richard

,

1990

Newcomb

Director
Office of Foreign Assets Control
mher

Approved

John P. Simps
g

Assistant

Secretary

(Enforcement)

Filed:

November

Publication

~, 1990

28, 1990

date:

November

(4:34 p. m. )
30, 1990

80

Bank
Gulf International
Gulf Investment Corporation
Independent Petroleum Group

Contracting Group
Jordan Fertilizer Industry Company
Jordan Kuwait Bank
Korea Kuwait Banking Corporation

International

t

Kuwa'.

French Bank
Investment Projects Company

Kuwait
Kuwait
Kuwait

Bank
National Cinema Company
National Bank of Kuwait

Lebanon

Investment

National

Housing

Oman

Pearl Holding

Company

Bank
Company

Swiss Kuwaiti Bank
The Arab Investment

Company

American Bank
Arab Shipping Company
Bank of Kuwait
Gulf Bank
Kuwait Bank

UBAF Arab

United
United
United
Yemen

Dated:

~

November

R. Richard

I,

1990

Newcomb

Director
Office of Foreign Assets Control
Approved.

mher

John P. Simps
g

Secretary

Assistant

(Enforcement)

piled:

November

Publication

~, 1990

28, 1990

date:

November

(4:34 p. m. )
30, 1990

artment of the Treasury o Washington,
. OR

IMMEDIATE

(UGUST

RELEASE

El.C. ~

CONTACT:

24, 1990

Telephone III-204&

BARBARA

566-2041

CLAY

STATEMENT

BY THE SECRETARY
THE TREASURY
NICHOLAS F. BRADY
OF

of the Treasury welcomes the preliminary
of Venezuela's offer of various
financing options to its creditor banks. Based on responses from
banks representing
904 of outstanding exposure, the banks' choices
will produce an estimated 204 net reduction in Venezuela's stock
of commercial bank debt and a 50% annual cut in external debtservice payments to banks. The two principal financing options
selected by banks were par bonds and new money totaling $1. 15
billion. The strong bank response reflects further successful
of the strengthened international debt strategy.
implementation
The Department

results of the

NB-930

Government

partmenf of the Treasury ~ Washlnijon, O.C. ~ Telephone SIN-2041
FOR IMMEDIATE RELEASE
AUGUST 24, 1990

CONTACT:

BARBARA

566-2041

CLAY

STATEMENT

BY THE SECRETARY
OF THE TREASURY
NI CHOLAS F. BRADY

of the Treasury welcomes the preliminary
of Venezuela's offer of various
financing options to its creditor banks. Based on responses from
banks representing
904 of outstanding exposure, the banks' choices
will produce an estimated 204 net reduction in Venezuela's stock
of commercial bank debt and a 504 annual cut in external debtservice payments to banks. The two principal financing options
selected by banks were par bonds and new money totaling $1. 15
billion. The strong bank response reflects further successful
implementation
of the strengthened international debt strategy.
The Department

results of the

NB-930

Government

~gAStip

BLI,„EBT
Department

of the Treasury

~

Bureau of the Public Debt

FOR IMMEDIATE RELEASE

August

27, 1990

L',

~

Washington,

Office of Financing

CONTACT:

202/376-4350

P7. . . ...
~

DC 20239

Q)

I

('ip

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

of

Tenders for $9e235 million of 13-week bills and for $9, 236 million
26-week bills, both to be issued on
August 30, 1990, were accepted today.

Average

Tenders
Tenders

at the
at the

26-week

1990

;

Investment

7. 47%
7. 49%
7. 49%

Low

29

November

Discount

High

bills

13-week

OF ACCEPTED
COMPETITIVE BIDS: maturin

RANGE

7. 72%
7. 74%
7. 74%

Price :
98. 112:
98. 107:
98. 107:

maturin
Discount
Rate

1991

7. 47%
7. 48%
7. 48%

7. 87%
7. 88%
7. 88%

96. 224
96. 218
96. 218

rate for the 13-week bills
rate for the 26-week bills

high discount
high discount

bills

Februar
28
Investment

allotted
allotted

were
were

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)

~ocation

Received
46, 790
$
27, 319, 415

Boston
New

York

Richmond

23, 435
45, 420
56, 460

Atlanta

31, 375

Philadelphia
Cleveland
Chicago
St. Louis
Minneapolis
Kansas City

Subtotal, Public
Federal Reserve
Foreign Official

Institutions
TOTALS

~1

Equivalent

NB-931

7, 997. 495
23, 435
45, 120
56, 460

$

38, 500
27, 965, 050
18, 550
38, 650

51, 390
25, 700

$

38, 500
8, 151, 100
18, 170
38, 650
51, 390
25, 200
81, 390
19, 520

44, 160

24, 160

27, 520

8, 650

8, 650

$31, 038, 880

44, 250
24, 040
153, 315
678, 550
$9, 234, 630

47, 335
24, 860
754, 115
594, 135
$31, 519, 845

47, 335
14, 860
146, 915
594, 135
$9, 235, 815

$26, 956, 465
1, 541, 915
$28, 498, 380
2, 302, 800

$5, 152, 215
1, 541, 915
$6, 694, 130
2, 302, 800

$27, 189, 450
1, 242, 295
$28, 431, 745
2, 300, 000

$4, 905, 420
1, 242, 295
$6, 147, 715
2, 300, 000

237, 700
$31, 038, 880

237, 700
$9, 234, 630

788, 100

788, 100
$9, 235, 815

~Te
Competitive
Noncompetitive

46, 790

1, 683, 680

11, 990

TOTALS

$

ted
Ance

Received

30, 375
101, 150

44, 250
34, 040
1, 019, 315
678, 550

Dallas
San Francisco
Treasury

ted
Ance

coupon-issue

yield.

9. 490

1, 925, 390

$31, 519, 845

85%.

62'

BLI
Department

of the Treasury
lt/',
'~d„''

EBT E

.
~

Bureau of the Public Debt

g r,

CONTACT:

FOR IMMEDIATE RELEASE

27, 1990

August

+crc o+

DC 20239

~ Washington,

Office of Financing
202/376-4350

Q, pI-

RESULTS OF'TREASURY'S

BILL

WEEKLY

AUCTIONS

Tenders for $9, 235 million of 13-week bills and for $9, 236 million
26-week bills, both to be issued on
August 30, 1990, were accepted today.

of

OF ACCEPTED
COMPETITIVE BIDS:

RANGE

7. 72%
7. 74%
7. 74%

7. 47%
7. 49%
7. 49%

Low

High

Average

Tenders
Tenders

13-week bills
November 29
maturin
Investment
Discount

1990

:

26-week bills
28
Februar
maturin
Investment
Discount

12; 7, 47%
98. 107: 7. 48%
98. 107: 7. 48%

98

7 87%

1

at the high discount rate for the
at the high discount rate for the

13-week
26-week

7. 88%
7. 88%

bills
bills

1991

Price
96. 224
96. 218
96. 218

allotted
allotted

were
were

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)
Received
46, 790
$
27, 319, 415

~ocation
Boston
New

York

23, 435
45, 420
56, 460

Philadelphia
Cleveland
Richmond

31, 375
1, 683, 680

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

44, 160

11,990

Dallas
San Francisco
Treasury
TOTALS

~Te
Competitive
Noncompetitive

Subtotal, Public
Federal Reserve
Foreign Official

Institutions
TOTALS

+1

Equivalent

NB-931

ted
Ance

$

46, 790
7, 997, 495
23, 435
45, 120
56, 460
30, 375

101, 150
24, 160

9, 490

ted
Ance

Received
$

38, 500
27, 965, 050
18, 550
38, 650

51, 390
25, 700
1, 925, 390
27, 520

8, 650
47, 335
24, 860
754, 115
594, 135

$

38, 500

8, 151, 100

18, 170
38, 650
51, 390
25, 200
81, 390
19, 520
8, 650
47, 335
14, 860
146, 915
594, 135
$9, 235, 815

44, 250
34, 040
1, 019, 315
678, 550
$31, 038, 880

44, 250
24, 040
153, 315
678, 550
$9, 234, 630

$31, 519, 845

$26, 956, 465
1, 541, 915
$28, 498, 380

$27, 189, 450
1, 242, 295
$28, 431, 745
2, 300, 000

$4, 905, 420
1, 242, 295
$6, 147, 715

2, 302, 800

$5, 152, 215
1, 541, 915
$6, 694, 130
2, 302, 800

237, 700
$31, 038, 880

237, 700
$9, 234, 630

788, 100

788, 100
$9, 235, 815

coupon-issue

yield.

$31, 519, 845

2, 300, 000

85%.
62%.

apartment'

of @he Treasury

~ Washlnyion,
', '
i''-.i &i[ 'wj
r'

FOR IMMEDIATE

August

RELEASE

'

O.c. o Telephone $60-24%

CONTACT:

28, 1990

RESULTS OF AUCTION

Office of Financing
202/376-4350

OF 2-YEAR NOTES

The Department of the Treasury has accepted $11,557 million
$28, 548 million of tenders received from the public for the
2-year notes, Series AD-1992, auctioned today. The notes will be
issued August 31, 1990, and mature August 31, 1992.

The interest rate on the notes will be 8-1/8-o. The range
of accepted competitive bids, and the corresponding prices at the
8-1/8-: rate are as follows:
Yield
Price
Low
8. 18%
99. 900
99.864
High
8. 20~o
Average
19%
99. 882
8.
Tenders at the high yield were allotted 56-:.
TENDERS RECEIVED AND ACCEPTED

Location
Boston
New

York

Philadelphia

Cleveland
Richmond

Atlanta

Chicago
Louis
Minneapolis
Kansas City

St.

Dallas
San Francisco
Treasury
Totals
The

Received
56, 760
$
25, 511, 035

38, 985
58, 270
160, 875
47, 390
1, 403, 680
93, 110
50. 945

113.720

34, 355
698, 970
279, 860
$28, 547, 955

(In Thousands)
56, 760
10, 189, 695
38, 985
58, 270
98, 995
46, 950
336, 835
82, 790
25, 945
112, 280
27, 155
202, 970
279, 860
$11, 557, 490
$

$11,557 million of accepted tenders includes $1, 372

million of noncompetitive tenders and $10, 185 million of competitive tenders from the public.
In addition to the $11, 557 million of tenders accepted in
the auction process, $665 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
An additional
international monetary authorities.
$1, 131 million
of tenders was also accepted at the average price from Federal
Reserve Banks for their own account in exchange for maturing

securities.

artmeni of ihe TreasulV
f/',

FOR IMMEDIATE

August

~
0

'

Washinoion,
O.C. ~ Telephone 166-2D41
r-~ir
iE
.

.

p

RELEASE

CONTACT:

28, 1990

RESULTS OF AUCTION

Office of Financing
202/376-4350

OF 2-YEAR NOTES

The Department of the Treasury has accepted $11,557 million
of $28, 548 million of tenders received from the public for the
2-year notes, Series AD-1992, auctioned today. The notes will be
issued August 31, 1990, and mature August 31, 1992.
The interest rate on the notes will be 8-1/8-o. The range
of accepted competitive bids, and the corresponding prices at the
8-1/8% rate are as follows:
Price
Yield
Low
99. 900
8. 18%
99.864
8. 20~o
High
99.882
Average
8. 19%
Tenders at the high yield were allotted 56:
~

TENDERS RECEIVED AND ACCEPTED

Location
Boston
New

York

Philadelphia
Cleveland

Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas
San Francisco
Treasury
Totals
The

$

Received
56, 760

25. 511,035
38, 985
58, 270
160, 875
47, 390
1, 403, 680
93, 110
50, 945
113,720
34, 355
698, 970
279, 860

$28, 547, 955

(In Thousands)
d

56, 760

10. 189, 695

38, 985
58, 270

98. 995
46. 950

336, 835
82, 790
25. 945
112, 280
27, 155

202, 970
279, 860
$11, 557, 490

$11,557 million of accepted tenders includes $1, 372

million of noncompetitive tenders and $10, 185 million of competitive tenders from the public.
In addition to the $11,557 million of tenders accepted in
the auction process, $665 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
An additional
international monetary authorities.
$1, 131 million
of tenders was also accepted at the average price from Federal
Reserve Banks for their own account in exchange for maturing

securities.

LI

tpartment of the Treasury'o.
DI:Pi, 0
FOR RELEASE AT

4:00 P.

~hlnpton,
Ti&~. I", , -~"'SL;&

D.C. ~ Telephone 666-204'I

'

CONTACT

MD

Office of Financing
202/376-4350

28, 1990

August

TREASURY'S WEEKLY BILL OFFERING

this public notice, invites
totaling approximately
$18, 400 million, to be issued September 6, 1990. This offering
will provide about $1, 675 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of $16, 723 million.
Tenders will be received at Federal Reserve Banks and Branches and at
the Bureau of the Public Debt, Washington, D. C. 20239. prior to 1:00
p. m. , Eastern Daylight Saving time, Tuesday, September 4, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
December 6, 1990 (CUSIP No.
and to mature
June 7, 1990
912794 VL 5), currently outstanding in the amount of $8, 627 million,
the additional and original bills to be freely interchangeable.
182-day bills for approximately $9, 200 million, to be dated
(CUSIP No.
March 7, 1991
September 6, 1990. and to mature
The Department of the Treasury, by
tenders for two series of Treasury bills

912794

VY

7).

bills will

basis under competitive
bidding, and at maturity their par amount will
and noncompetitive
interest. Both series of bills will be issued
without
be payable
entirely in book-entry form in a minimum amount of $10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury
bills maturing September 6, 1990. Tenders from Federal Reserve
Banks for their own account and as agents for foreign and international monetary authorities will be accepted at the weighted
Addiaverage bank discount rates of accepted competitive tenders.
tional amounts of the bills may be issued to Federal Reserve Banks,
as agents for foreign and international monetary authorities, to
the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
million as agents for foreign
Reserve Banks currently hold $985
and $4, 308 million for their
monetary authorities,
and international
Tenders for bills to be maintained on the book-entry
own account.
records of the Department of the Treasury should be submitted on Form
PD 5176-1 (for 13-week series) or Form PD 5176-2 (for 26-week series).
The

NB-933

be issued on a discount

artment of the Treaslsiy'
DEPT.

~

~h)slgton,

0r T'iL i;:'."A~0;i'(

4:00 P. M.

FOR RELEASE AT

D.C. ~ Telephone 56$-2D4
CONTACT:

28, 1990

August

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by
for two series of Treasury bills

this public notice, invites
totaling approximately
$18, 400 million, to be issued September 6, 1990. This offering
will provide about $1, 675 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of $16, 723 million.
Tenders will be received at Federal Reserve Banks and Branches and at
the Bureau of the Public Debt, Washington, D. C. 20239, prior to 1:00
p. m. , Eastern Daylight Saving time, Tuesday, September 4, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
June 7, 1990
and to mature
December 6. 1990 (CUSIP No.
912794 VL 5), currently outstanding in the amount of $8, 627 million,
the additional and original bills to be freely interchangeable.
182-day bills for approximately $9, 200 million, to be dated
(CUSIP No.
September 6, 1990, and to mature
March 7, 1991
912794 VY 7)tenders

The

bills will

The

bills will

basis under competitive
and noncompetitive
bidding, and at maturity their par amount will
Both series of bills will be issued
be payable without interest.
entirely in book-entry form in a minimum amount of $10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury.

bills

Banks

maturing

for their

be issued on a discount

be issued for cash and in exchange for Treasury
Tenders from Federal Reserve
September 6, 1990.
own

account and as agents for foreign and inter-

monetary authorities will be accepted at the weighted
average bank discount rates of accepted competitive tenders.
Additional amounts of the bills may be issued to Federal Reserve Banks,
as agents for foreign and international monetary authorities, to
the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
million as agents for foreign
Reserve Banks currently hold S985
authorities,
and $4, 308 million for their
international
monetary
and
Tenders for bills to be maintained on the book-entry
own account.
records of the Department of the Treasury should be submitted on Form
PD 5176-1 (for 13-week series) or Form PD 5176-2 (for 26-week series).

national

NB-933

13

2

6-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury's single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.

noncompetitive bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of
A

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

13 — 2 6-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury's single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.

noncompetitive bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of
A

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

deposit need

in the auction.

accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments

will be

made

new

for differences

bills accepted

maturing

bills.

If

bill is

between the par value of the
in exchange and the issue price of the

at issue,

is

held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
Accrual-basis taxpayers, banks, and other
the bill matures.
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
a

purchased

and

of the Treasury Circulars, Public Debt SeriesNos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Treasury

Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments

will be

made

new

for differences

bills accepted

maturing

bills.

If

bill is

between the par value of the
in exchange and the issue price of the

at issue,

is

held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
a

purchased

and

Department of the Treasury Circulars, Public Debt SeriesNos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of

the Public Debt.

8/89

DEBT NEW

UBLI
Department

of the Treasury

~

Bureau of the Public Debt

~

4

DC 20239

Washinyon,

~~

FOR IMMEDIATE RELEASE

Office of Financing

CONTACT:

29, 1990

gj;,

RESULTS OF AUCTION

„„~~ g

.

J

.

202/376-4350

OF 5-YEAR 2'-MONTH'

NOTES

The Department of the Treasury has accepted $8, 561
million
of $26, 345 million of tenders received from the public for the
5-year 2-month notes, Series M-1995, auctioned today. The notes
will be issued September 4, 1990, and mature November 15, 1995.

interest rate on the notes will be 8-1/2~- The range
of accepted competitive bids, and the corresponding prices at the
8-1/24 rate are as follows:
The

Yield
Low

High
Average

8. 56% *
8. 58%
8. 57%

Price
99. 685
99-603
99. 644

* Excepting $70, 000 at lower yields.
Tenders at the high yield were allotted 20%.
TENDERS RECEIVED AND ACCEPTED

Location
Boston
New

York

Philadelphia
Cleveland

Richmond

Atlanta

Chicago
St. Louis
Minneapolis
Kansas City

Dallas
San Francisco
Treasury
Totals

Received
25, 273
$
24, 258, 776

15, 466
31, 757

140, 908
20, 010
1, 053, 235
32, 454
20, 124
53, 861
14, 204
674, 554
3, 908
530
344,
$26.

(In Thousands)
d

25, 273
201
021,
8,
15, 466

31, 754
50, 188
19, 976

221, 630
27, 454
20, 124
53, 861
12, 399
57, 482

3, 908

$8, 560. 716

million of accepted tenders includes $672
The $8, 561
million of noncompetitive tenders and $7, 889 million of competitive tenders from the public.
In addition to the $8, 561 million of tenders accepted in
the auction process, $415 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
international monetary authorities.
NB-934

dd

+ltC 0+

d

August

~

UBLI
Department

of the Treasury

DEBT NEW
~

Bureau of the Public Debt

~

2QA'~
i
..

J

FOR IMMEDIATE RELEASE

CONTACT:

29, 1990

August

j)!g „~

RESULTS OF AUCTION

g

~ g

DC 20239

Washinyon,
.

)

Office of Financing
$02/376-4350

OF 5-YEAR 2'-MONTH'

NOTES

The Department of the Treasury has accepted $8, 561
million
of $26, 345 million of tenders received from the public for the
5-year 2-month notes, Series M-1995, auctioned today
The notes
will be issued September 4, 1990, and mature November 15, 1995.
The interest rate on the notes will be 8-1/2~. The range
of accepted competitive bids, and the corresponding prices at the
8-1/2% rate are as follows:
Yield
Price
Low

High

Average

8. 56% *
8. 58%
8. 57~a

99-685

99. 603
99. 644

* Excepting $70, 000 at lower yields.
Tenders at the high yield were allotted 20%.
TENDERS RECEIVED AND ACCEPTED

Location
Boston
New

York

Philadelphia
Cleveland

Richmond

Atlanta

Chicago
Louis
Minneapolis
Kansas City

St.

Dallas

San Francisco

Treasury

Totals

Received
25, 273
S
24, 258, 776

15, 466
31, 757
140, 908

(In Thousands)
$

25, 273

8, 021, 201
15, 466
31, 754

50, 188

19, 976

20, 010
1, 053, 235
32, 454
20, 124
53, 861
14, 204
674, 554

221, 630
27, 454
20, 124
53, 861
12, 399
57, 482

$26, 344, 530

$8, 560, 716

3, 908

3, 908

million of accepted tenders includes $672
million of noncompetitive tenders and $7, 889 million of competitive tenders from the public.
The $8, 561

In addition to the $8. 561 million of tenders accepted in
the auction process, $415 million of tenders was awarded at the
average price to Federal Reserve Banks as agents for foreign and
international monetary authorities.
NB-934

~~

~ ~

~~

I

D-PORTMENT OF TH:- TREASURY
WASKtNCYON

OF-ZCZ OF FOREIGN ASS=TS COÃTROKVRAT™xlASS 8 CONTRO~ R GAL&TIOh
IRAQ
S NCTIOh'S 3" GULATXOYS
'

G- N- Ski, LICHENS" NO.

9

Initiated Brio" to Zf fec ape gate.
(a) Goods alai-ing exportation to dirac or Ku~ait on
th effective c'. ate and seized o- detained by the u. S. Customs
se vice on the effect ve Cate o the=ca ter pursuant to

-x&ort Transactions

~

=xecutive Orde=s 12722 o 12723 or Execu ive O-oers 12724 or

12725,

may

be

released

exporter provided

=o the

are filed vit4 Cus"oms o

documents

ic'als at

the folloving.
the port where

such goocs are loca
he e xportat i o
(I ) A copy o tuse cont 2ct governing
(sale or other t ansfer) o he goods to Irac o" Kuwait
i no contract exis" s, a written explana ion o the
circumstances o exportat'on, including in ei her case
and. -terms o= pa~went rece jpe„=
a descripti on of the zanne
o",
or to be =eceived bv the exporter (or other person)
o by reason of, the exoortation of the goods;

o,

(2)

An

invo

ce, bill

o

jul'y describing the goods;
r
~

(3)

A

s atement

by

1aCiing, or other oocumen

a

ion

and

the expo" ter substantially

in

C

,

~olloving

form:

oi -he Qcvernmensnv amo=nt received from -= on beha'
eason
o= the
of 7 rag o the Cove nment o Kuwai i by
a temp ed exportation of the goocs . eleased to lname o
exporter] bv th g S. Custo. s Se vice. on [boatel i and f'l'y
c'esc ibec in -he a:-ache. oocu en s, has been or vill be
placed ir to a b'ockeC account in a U S ~ banking institu ion
pore ign Asse „s Control, Rlockea As se s

.

~

D-PORTMENT OF

TH: TREASURY

WASK1KGTON

OZPZCE
KCRAETZ

OF FOBZZGN ASSETS CONTROL
CONTRO~ RZGuL2TIOIiS
IRP Q 7 SANCTIONS R" GULATZOh'. S

2SSE: S

G-N- RAT LIC NS" NO-

=-xoort Transactions

9

tiated Pr for to Zffec-ive Da e.
(a) Goods a~aitjng exportation to Xraa or Kuvait on
th effect ve c'. a e and seized o- detained by the U. S. Customs
se vice on the effec ive Cate o therea. ter pursuant to
Tn

=xecu ive Orders 12722 o
1272S

may

released

be

are ~iled vi

documents

such ooocs are loca

(1)

A

12723 or Execu ive Orders 12724 or
o the expor er provided the folloving.

+ Cus"oms

o

ic'als at

the port where

ed:
the cont act governing

copy o

"he exporta"ion

(sale or other transfer) o the coods to Irac o" Kuvai"
or, i no contract exis" sI a vr j ten explana ion o he
Ciroumetances 0 exportat'on, inclu~ing in ei her case
a t'escriptjon o
he rcanne
and. terms o= pa~~~ ent receive=
or to be -eceived bv the exports. - (or other person) Lor,
o by reason of, the exportation of he aoods;
(2)
foully
~

An

invoice, bill o

describing
(3)

olloving

A

lading,

or other oocumen

the goods; and

statement

by

t5e exporter substantially

jn the

f orm:

from -= on beha' 1 ~ of0 he governmenIrac o- he Cove nmen- o Ku~ai by eason o= the
ttemp e" exoortation of the goods -. eleased to [name o f
xporter] bv the U. S. Customs Service on jCate] z and f ply
esc ibec in t~~e a:tachcd oocu-. en s, has been or
lace8 into a b'ocke8 account in a U S banking inst jtu
.--ore ign As se. s Contr ol, Rlocgec As se
A iy

azo nt received

~

C

ation

Section. will

+mediately noti ieQ. {Name of exporter]
oz any
agrees o fully incemni y the U-S. Government
amo nt u tir-ate y octa --.i..equi by a co' - o come en
jur saiction to be cue or payable o or for the 'beret it
of eny person by reason of the failure of jname:of, '
o prope ly pay into a bh. ockeCi account thy
exporter]
received for the eoods
amoun
ou o on behalf o
the
Govt. =nment of:ra+ o tue Cove nmen
of Euwa
Nave
f
of expo= ez] also agrees to waive all claims {l) against
any payments zece ver and placed 'nto a blociced accoun
except as may be la" ez a "ho izeD by law, regula ions, or
license, and (2) against the U. S- Gove=nmen with regard
to the c sposit'on o the amounts placed into a blockec
account
be

~

~

it.

~

'

The statemert

sho 10 be dated

signed

by

ted to s'gn o~ -he exporter's

a pe"son author

s'

and

the exporter

behalf.

or

by

The

Service ray release the goods to the expo ter upon
receipt of the Boc mentation and s atemen" describe6 above,
proviced it is satisf'ec t&at alj Customs laws an@ regulations
have been corpl'egj wi „h, =nclucing the execution o" such hold.

C

oms

harrlcss ass ~rances as i= sha11 oetez«ine to be appzop" iate.

at'

The docv~nen

on anC

-" -tement

receiveC by Cus

oms w'

1 be

fice of:-oreign Assets onirol for review
appropriate action.
(c) Ter-s users in this license aze defined as follows:
(1) she term "e ec 've da e" shall mean {A) 5:00

wa

to

Ged

he 0

a-~. i =astern Davlight
+f

e'x

Qof ~t qr e~N

EDTr

to kuwait
op«a ed

oztations

o-

os
Locus -

to
2'rota

9,

{FDT), August 2, 1990, in the
to dirac o to or for the bene it of the
'Zime

of Kuwait; c ', "-) 8 55
hc case o f other exportations
a business in a third country

z&e Government
3. 9 9 0

&

in

a no.".governmen

Iraa or Kuwait.

Sectio. , vill

be imbed'ately
noti ieQ. [Name of expo ter]
agrees to fully incemni y the U. S. Government
for any
amo nt ultimate'y
acts inca by a Cour- of COme
en
jur sdiction to be due or payable o or for the 'beref
of any person by reason of the f ai lure o~ [name: of, . 't
expor erf to prope Ly pay into a blocked account my
amoun
received fo= the &oods rom o on behalf o the
Govt-nment of iree 0 the Gove nmen
Kuvait
fila~le
of exporterl also agrees to waive all ofclaims
{l) against
any paymen s rece ved and placed 'nto a blocked
except as may be ' ater a" tho i.zeD by law, regula accovn
or
license, and {2) against he U. S. Gove "nmen wi h ions,
'
regard
to the c'sp sit'on o the amoun s placed into a blocked
account.
—.

~

sta emert sho lC be dated and signed by the expo ter or
a pe"son au-hor zec to sign on -he exporter's behalf. . The
C stoms Serv ce rav re ease -he goods -o the
exporter upon
receipt of the doc mentation a, nd s atemen" describe~ above,
The

it is satisf

provided

have been compl' eC

wi

barr less assurances

ec that all Customs laws
-

h,

ncluding

and

the execution

by

regulations

o" such hold

as i= shall determine

to be ap-rop" iate.
The docuunertation
anC sta ement receiveC by Cus'o. .a w 1 be
fo warced to the 0 +ice o= =oreign )ssets Control for revie~
ani appropriate ac ion.
(c) Terms useC in this license are defined as follows:
(1) The erm "e ective Cate" shall mean {A) 5:00
a-~- i =astern Daylight Time {FD=), August 2, 1990, in the
case t&f e'x or&ations to Irac o to or or the bene it of the
Gov rnment of ran or z&e Governzen
of KQ- ait,.
{-) 8: i5

cr,

p m.

to

~

I'DT

Quwai

operated

Q

&ugus

or to

9

3. 9 p

Q

~

in

hc case of othe

no. .governmenta

from Zr &0 or Kuwait.

bvsiness

in a

ta i or s
third covn ry

e xpor

(2)

he

te

(A) The

as any poli

dwell

of Iraq" shall

"Gove nment

m

s «ate arC

of Trac, as
agency, or instrumentali"y

he Government

'ca' subdivis'on,

hereof, incl"Bing the Central Bank o dirac;
(3) J lv partnership
association

corporation,
ovnet o= controllers by the foregoing;.
pe "son to the extent such pe son 1s 'or
p

othe

organization
{C) P~y

has

b

is,

here

is reasonable cause to

or has been, since the ef fec ive

date, acting or purpor inc to act, direc ly
behal of any of -he foregoing; a, nd
(D) ~qv
by

he Sec

et'. =v

o

f

g

en, or to -he ex ent

believe such person

mean

o=

'ndirectly
dete

other person or o ganization
the -reas ry «o

on

net
be included vi hin th' s
Ti

sect~ on

of Kuwait" sha' l &viean
Government of Ku~a
or anv
c Ki:wait as hell Ks any
ther eO~
Or 'nStr umentality

{3) Tne term "Government
(A) The

sta

e and,

puroortin=

~

to be „he Qove nmen
pO — tical Subc ivi$ iOn
eg&nCy,
include ing
he Central Bank of Kuwait'
g

ear ner ship associat& on, corporation,
other organization owneCi or controlled by any o the
(S)

o

g

Wry

C

r

f oreg'. oin g;
person to "he extent that such person
is, or has been, o= to the extent that there is easonable
cause to believe such pe=son is, o= has been& since the
(C) p.ny

e

fec ive Bate, ac-ing or

pu

any

oortinc to act, direc lv
o -he foregoing; are

en

ity

e

(2) The

he s-' a e arC

(A)

~el

l

Lhef

as any

polit cal

eof, incl

"Gove nment

m

Tran" shall mean

o

he Government

subc. ivision,

agency,

Central Bank o

5 ing the

Irac,

of

as

ality

or instrumen

dirac;

(3) b~y pa. tnership, association, corporation,
other organization ovned o= controlled by the foregoing(C) P~y pe"son to the extent such pe=son is, . or
has been, or to

='he

believe such person

is

exteint there

is,

reasonable

cause to

or has been, since the effec ive

date, acting or purpor inc to ac , direc ly oz indirectly
behal of any of the foregoing; and
o-her pe~son of o ganization Bete m
by

he

Sec eta=y of the

~

to

reasury

be included

v

~

hin

on

~

nel5

this

section~

of Kuwait" sha' l mean
Gove nment of Kuwait or

{3) Tne terr~ "Government
(A) T' e

sta

e and

any en

to be the Qover. men o Kiwait, as veil as any
political subdi vis ion eg&ncp or instr umentality ther eo„g
including
he Central Bank of Kuwait;
(s) Any partnership, association, corporation,
other organization ovned or contro led by any o the

purpo=tin=

g

&

C

r

foregoings
)

A,

erson to "he extent that such parso.
to the extent hat the e is
has been, since the

or

pu

porting

to

(D) Any o".her person
bv

the Secretary of the Treasury

or orcanixation

determined

to be included within th' s

section.
(4) The term "blocked account

shall riiean an account
a U. S. bank nc ins" tution wi th respect to vhich acco
payments, t ar. s e=s or withdrawals
or othe- dealings may no
made o ef ected except pursuan"
"o an authorization or
license ~ om "he Office of Foreign As e-s Control.
~

~

ere "U. S . bank'nc

(5) The
any U. S. person

institT:tion" shall

be

mean

that is engaged
in the bus ='ness o acceo ' nc depos' ts 0 making
gran inc
transferrirc, hold i n~, or broidering loans or c e its ' nc "0 inc
but r. ot ' ' .i ed 0 banks
s oi'n s banks, and t us CGH'Q n ies .
('ncluc. ing ro eign

b anches)

g

(6) T

ci

= -erm

"V. S. pe=son" shall

mean

ary United

-eside. . elie. . . ju idica person
or Qani zed unde the laws of the United States (including
fore''cn branches), or any person in he United States.

Sacs

Issued:

W

zen, pe=manent

August

charo

5'irectcr,

27, 190

Newcowb
Of f ice

Gf:-oreign Assets Cortrol

'

(D) Any

o.hez

person or organization

the Secretary of the Treasury

bv

determined

to be inclu=ed within th' s

section.
(4) The term "blocked account shall r«ean an account
a U. S. bank'nc institution
wi h respect to which acco

trans e=s oz withdrawals or other dealings may no
"o an authorization or
made or ei ected except pursuan"
license ~rom the Office of Fore'gn Asse s Control.

patients

~

era "U. S. bank'nc

(5) The

insiiiut'on"

shall

be

mean

any U. S.

perso:. (incluc, ing fore'gn branches) that is engaged
in the bus='ness 0 accep: nc depos' is or Faking grantlnc
trans err''ng, ho'd n , or brokering loans
but not ' Lmlied
o, banks, savings banks, and i us cozoanies.
p

S

(c) T
a es ci izen,

organ' zed

iern "U'. S. person" sha'
he

foreicn branches),

Issued:
/

R.

August

mean

.

or any person

in ~he United

27, 1990

r

'chard

W.

Newcomb

~+irectoz, 0

any United

=eside. . elie. . ju i8ica person
laws of the United States (including

pe=manen

u

l

~

f'ce of

=-oreign

assets

&ont

ol

States.

of the treasury

iyortmenC

~ Nosh/nleon,

RELEASE

FOR IMMEDIATE

O.c.

CONTACT:

30, 1990

August

STATUS OF .NEGOTIATIONS
INFORMATION

OF INCOME
EXCHANGE

g+++Op

514 QO+j

LARRY BATDORF
—0 1
(202

TAX TREATIES AND
AGREEMENTS

TAX

The Treasury Department
announced today the countries with
which
is currently engaged in income tax treaty and tax
information exchange agreement (TIEA) negotiations and invited
comments from interested persons.
Comments should be submitted
in writing to Philip D. Morrison, International Tax Counsel, Room
3064, Treasury Department, Washington, D. C. 20220.

it

I.

INCOME

A.
and

TAX TREATIES

Senate Forei
Senate action:

roved b

A

awaitin

n

Relations

Committee

on June

29

Finland
Germany

India
Indonesia

Spain

Tunisia

Multilateral

Tax Matters

Convention

on Mutual

Administrative

Assistance

in

B. Active Ne otiations; Meetin s Recentl Held or Scheduled
Israe --protoco to existing treaty (not in effect) initia led
April 27
Taiwan--first round of discussions on an income tax agreement
held July 9-13; second round expected spring 1991
Bulgaria--first round held June 21-25; second round scheduled

October 29-November 2
discussions held August 7-9;
Czechoslovakia--preliminary
expected
spring 1991
discussions
further
further discussions
13-17;
held
August
Mexico--second round
expected during 1991
of a protocol to existing treaty to
Canada--negotiation
continue September 4-7
USSR--third round of negotiation on a new treaty tentatively
scheduled for September 10-14
on estate tax matters scheduled for
Germany--discussion
September

NB-935

10

~

potent

of the Ttealorf

~ Waatltnyton,

RELEASE

FOR IMMEDIATE

-'

O.C. ~ To&yhono

CONTACT:

LARRY BATDORF
—0 1

(202

30, 1990

August

II4.2O4$

STATUS OF .NEGOTIATIONS
INFORMATION

OF INCOME TAX TREATIES AND
EXCHANGE AGREEMENTS

TAX

The Treasury Department
announced today the countries with
which
is currently engaged in income tax treaty and tax
information exchange agreement (TIEA) negotiations and invited
comments from interested persons.
Comments should be submitted
in writing to Philip D. Morrison, International
Tax Counsel, Room
3064, Treasury Department, Washington, D. C. 20220.

it

I.

INCOME

A.
and

TAX TREATIES

Senate Forei
Senate action:

roved b

A

awaitin

n

Relations

Committee

on June

29

Finland
Germany

India
Indonesia

Spain

Tunisia

Multilateral

Tax Matters

Convention

on Mutual

Administrative

Assistance

in

Held or Scheduled
Ne otiations;
Meetin s Recentl
Israel--protocol to existing treaty (not in ef ect) initia led

B. Active

April 27

Taiwan--first

of discussions on an income tax agreement
second round expected spring 1991
Bulgaria--first round held June 21-25; second round scheduled
October 29-November 2
discussions held August 7-9;
Czechoslovakia--preliminary
further discussions expected spring 1991
Mexico--second round held August 13-17; further discussions
expected during 1991
Canada--negotiation
of a protocol to existing treaty to
held July

round

9-13;

continue September 4-7
USSR--third round of negotiation on a new treaty tentatively
scheduled for September 10-14
on estate tax matters scheduled for
Germany--discussion
September

NB-935

10

protocol to existing income tax
treaty scheduled for September 19
Prance--meeting scheduled week of October 8 to discuss a
technical protocol
Switzerland--negotiation
of a new treaty to continue October

Barbados--discussions

on a

22-26

Netherlands--negotiation
of a new treaty to continue November
5-9
Portugal--discussions
possible December 1990 or January 1991
Thailand--negotiations
scheduled January 14-19, 1991
Pakistan--negotiations
scheduled March 11-15, 1991
C. Other Active

Ne

otiations;

No

Meetin

s Scheduled

Bangladesh--correspondence
on open issues
Belgium--correspondence
on open issues
Denmark--correspondence
on a protocol to proposed treaty (not
in effect) to cover 1986 Tax 'Reform Act and other changes
Ireland--meeting
to resolve open issues to be scheduled for
first half of 1991
Italy--negotiation of a protocol to existing treaty
Sweden--text of new treaty undergoing final review
Sri Lanka--correspondence on open issues
Turkey--correspondence
on open issues
Zambia--correspondence
on open issues
D.

otiations

Ne

Initiated but not currentl

active

Austria

Barbados
Kuwait

Malaysia
Singapore
Trinidad 6 Tobago
Yugoslavia

II. TAX

INFORMATION

EXCHANGE

AGREEMENTS

Effect
Barbados (effective November 1984)
Bermuda (effective December 1988)
Dominica (effective May 1988)
Dominican Republic (effective October 1989)
Grenada (effective July 1987)
Jamaica (effective December 1986)
Mexico (effective January 1990)
Trinidad and Tobago (effective February 1990)
B. Si ned, But Not Yet In Effect — pending approval of Foreign
Legislative Body
Costa Rica

A. In

~

Peru

St.

Lucia

protocol to existing income tax
treaty scheduled for September 19
France--meeting scheduled week of October 8 to discuss a
technical protocol
Switzerland--negotiation
of a new treaty to continue October
22-26
Netherlands--negotiation
of a new treaty to continue November
5-9
Portugal--discussions
possible December 1990 or January 1991
Thailand--negotiations
scheduled January 14-19, 1991
Pakistan--negotiations
scheduled March 11-15, 1991

Barbados--discussions

C. Other Active

Ne

on a

otiations;

No

Meetin

s Scheduled

Bangladesh--correspondence
on open issues
Belgium--correspondence
on open issues
Denmark--correspondence
on a protocol to proposed treaty (not
in effect) to cover 1986 Tax 'Reform Act and other changes
Ireland--meeting
to resolve open issues to be scheduled for
first half of 1991
Italy--negotiation of a protocol to existing treaty
Sweden--text of new treaty undergoing final review
Sri Lanka--correspondence on open issues
Turkey--correspondence
on open issues
Zambia--correspondence
on open issues
D.

otiations

Ne

Initiated but not currentl

active

Austria

Barbados
Kuwait

Malaysia
Singapore
Trinidad a Tobago
Yugoslavia

II. TAX

INFORMATION

EXCHANGE

AGREEMENTS

Effect
Barbados (effective November 1984)
Bermuda (effective December 1988)
Dominica (effective May 1988)
Dominican Republic (effective October 1989)
Grenada (effective July 1987)
Jamaica (effective December 1986)
Mexico (effective January 1990)
Trinidad and Tobago (effective February 1990)
B. Si ned, But Not Yet In Effect — pending approval of Foreign
Legislative Body
Costa Rica

A. In

~

Peru

St.

Lucia

C. Active
Bahamas

Ne

El Salvador

Guyana

Honduras

otiations

C. Active
Bahamas

Ne

El Salvador

Guyana

Honduras

otiations

UBLI 'DEBT
Department

of the Treasury,

FOR IMMEDIATE RELEASE

4, 1990

September

L'

..

~

~'

.Bttp~tt

of the P~glic Debt

I', ] E, ;, c h, „l:;-g

i. 0 I-

~

~ Washington,

+etc o+

DC 20239

Office of Financing

CONTACT:

202/376-4350

Tenders for $9, 233 million of 13-week bills and for $9, 219 million
of 26-week bills, both to be issued on September 6, 1990, were accepted today.
OF ACCEPTED
COMPETITIVE BIDS:

13-week bills
maturin
December 6
Discount
Investment

7. 35'%
7. 40%
7. 39%

Low

High

Average

Tenders
Tenders

7. 59%
7. 65%
7. 64%

26-week

1990

Price
98. 142
98 ' 129
98. 132

at the high discount rate for the
at the high discount rate for the

bills

maturin
Discount
Rate

Investment

7. 33%
7. 37%
7. 36%

7. 72%
7. 76%
7. 75%

13-week
26-week

1

bills
bills

96. 294
96.274
96. 279

allotted
allotted

were
were

68%.
29%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

Location
Boston
New

ted
Ance

Received

35, 290
7, 515, 765
16, 200
41, 665
48, 675
29, 555
464. 420
30, 150
16, 235
40, 405
25, 170

25, 170
292, 625
927, 945
780
676, 780
676,
$24, 832, 775 $9, 232, 935

36, 720
23, 301, 910
19, 710
32, 030
43, 795
24, 100
1, 466, 685
25, 130
19, 240
45, 885
24, 340
735, 580
666, 390
$26, 441, 515

$5, 497, 665
1, 447, 745
$6, 945, 410

$22, 097%745
1, 283, 965
$23, 381, 710

2, 211, 330

2, 250, 000

76, 195
76, 195
$24, 832, 775 $9, 232, 935

809, 805
$26, 441, 515

$

York

Philadelphia
Cleveland

35, 290
21, 038, 085
16, 200
41, 665

$

48, 675
29, 555
1, 893, 420
40, 150

Richmond

Atlanta
Chicago

St. Louis
Minneapolis
Kansas City

19, 435
40, 405

Dallas
San

(In Thousands)

Received

Francisco

Treasury
TOTALS

$

~Acce
$

ted

36, 720

7, 820, 660
19, 710
32, 030
43, 795
24, 100

335, 185
19, 710
19, 240
45, 250
24, 340

131,870
666, 390
$9, 219, 000

~Te
$21, 097, 505

Competitive
Noncompetitive

1, 447, 745

Subtotal,

Public $22, 545, 250
Federal Reserve
2, 211, 330

Official
Institutions

Foreign

TOTALS
An

additional

thousand
new

cash.

$1, 405

of 26-week bills

Equivalent

coupon-issue

:

$4, 875, 230
1, 283, 965
$6, 159, 195
2, 250, 000

809, 805

$9, 2]9

thousand of 13-week bills and an additional
will be issued to foreign official institutions

yield.

~

I
A~

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

RANGE

~~ ~ ~

QQQ

$12, 195
for

UBLI
Department

of the Treasug,

~

qPttgQqpfghe

Pu(lie Debt ~ Washington,

FOR IMMEDIATE RELEASE

CONTACT:

4, 1990

September

E

DEBT

'

e ~
~

1

DC 20239

Office of Financing
202/376-4350

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

Tenders for $9, 233 million of 13-week bills and for $9, 219 million
of 26-week bills, both to be issued on September 6, 1990, were accepted today.
OF ACCEPTED
COMPETITIVE BIDS:

RANGE

13-week bills
December 6
maturin
Discount
Investment

7. 35%
7. 40%
7. 39%

Low

High

Average

at the
at the

Tenders
Tenders

7. 59%
7. 65%
7. 64%

26-week bills
maturin
1
Discount
Investment
Rate

1990

98. 142
98. 129
98. 132

7. 33%
7. 37%
7. 36%

rate for the 13-week bills
rate for the 26-week bills

high discount
high discount

7. 72%
7. 76%
7. 75%

96. 294
96. 274
96. 279

allotted
allotted

were
were

68%.
29%.

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

Location
Boston
New

Received
35, 290
$
21, 038, 085

York

Philadelphia

16, 200
41, 665
48, 675
29, 555
420
893,
1,
40, 150
19, 435
40, 405

Cleveland
Richmond

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

$

Received

35, 290
7, 515, 765
16, 200
41, 665
48, 675
29, 555

36, 720
23, 301, 910
19, 710
32, 030
43, 795
24, 100
466,
685
1,
25, 130
19, 240
45, 885
24, 340
735, 580
666, 390
515
441,
$26,
$

464, 420

30, 150
16, 235
40, 405
25, 170
25, 170
292, 625
927, 945
676, 780
676, 780
935
232,
$24, 832, 775 $9,

Dallas
San

(In Thousands)
ted
Ance

Francisco

Treasury
TOTALS

~Te

$22, 097, 745
1, 283, 965
$23, 381, 710

$21, 097, 505 $5, 497, 665
1, 447, 745 1, 447, 745
Subtotal, Public $22, 545, 250 $6, 945, 410
Federal Reserve
2, 211, 330 2, 211, 330
Competitive
Noncompetitive

Foreign

Institutions

76, 195
76, 195
$24, 832, 775 $9, 232, 935

TOTALS
An

additional

thousand
new

2, 250, 000

Official

of

26-week

$1, 405
bills

coupon-issue

ted
Ance
$

36, 720
7, 820, 660
19, 710
32, 030
43, 795
24, 100
335, 185
19, 710

19, 240
45, 250
24, 340

131,870
666, 390
$9, 219, 000
$4, 875, 230
1, 283, 965
$6, 159, 195
2, 250, 000

809, 805

$9, 219

thousand of 13-week bills and an additional
will be issued to foreign official institutions

cash.
Equivalent

:

809, 805
$26, 441, 515

yield.

\&

QQQ

$12, ]95
for

I

apartment of the Treasury
'-~-Pl.

FOR RELEASE AT

September

~
&'p

Washington,

D.c. ~ Telephone 566-2O&

«'(E Tp -p
''. V ii)

4:00 P. M.

CONTACT:

4, 1990

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by
tenders for two series of Treasury bills

this public notice, invites
totaling approximately
$18, 400 million, to be issued September 13, 1990- This offering
will provide about $1, 600 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of S 16, 804 million.
Tenders will be received at Federal Reserve Banks and Branches and
at the Bureau of the Public Debt, Washington, DE C. 20239, prior to
1:00 p. m. , Eastern Daylight Saving time, Monday, September 10, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
June 14, 1990,
December 13, 1990 (CUSIP No.
and to mature
VM
912794
3), currently outstanding in the amount of $8. 928 million,
the additional and original bills to be freely interchangeable'
182-day bills ( to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
March 15, 1990,
March 14, 1991
(CUSIP No.
and to mature
of
910 million,
the
amount
in
VZ
$9,
outstanding
912794
4), currently
the additional and original bills to be freely interchangeable.
The bills will be issued on a discount basis under competitive
and noncompetitive
bidding, and at maturity their par amount will
Both series of bills will be issued
be payable without interest.
form
in
a minimum amount of $10, 000 and in
entirely in book-entry
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches, or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury
bills maturing September 13, 1990. Tenders from Federal Reserve
Banks for their own account and as agents for foreign and international monetary authorities will be accepted at the weighted
Addiaverage bank discount rates of accepted competitive tenders.
Federal
to
Reserve
issued
Banks,
be
bills
may
the
tional amounts of
monetary authorities,
to
as agents for foreign and international
tenders
for
such accounts
the extent that the aggregate amount of
bills
held
them.
maturing
of
Federal
by
amount
exceeds the aggregate
million
as
545
for
agents
foreign
hold
$1,
Reserve Banks currently
and S4, 378 million for their
monetary authorities,
and international
Tenders for bills to be maintained on the book-entry
own account.
records of the Department of the Treasury should be submitted on Form
PD 5176-1 (for 13-week series) or Form PD 5176-2 ( for 26-week series).

L

3. :&

Department

of the Te'easury
-0 —PT,

FOR RELEASE AT

September

4:00

4, 1990

Z

~
Qf

Washington,
'.

D.c. ~ Telephone 566-2O41

$L & - g
rl
gP&P» f/l

CONTACT:
PE M.

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by
tenders for two series of Treasury bills

this public notice, invites
totaling approximately
$18. 400 million, to be issued September 13, 1990. This offering
will provide about $1, 600 million of new cash for the Treasury, as
the maturing bills are outstanding in the amount of S 16. 804 million.
Tenders will be received at Federal Reserve Banks and Branches and
at the Bureau of the Public Debt, Washington, D. C. 20239. prior to
1:00 p. m. , Eastern Daylight Saving time, Monday, September 10, 1990.
The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
June 14, 1990.
and to mature
December 13, 1990 (CUSIP No.
VM
912794
3), currently outstanding in the amount of $8. 928 million,
the additional and original bills to be freely interchangeable.
182-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
March 15, 1990,
March 14, 1991
and to mature
(CUSIP No.
VZ
912794
4), currently outstanding in the amount of $9, 910 million,
the additional and original bills to be freely interchangeable.
The bills will be issued on a discount basis under competitive
and noncompetitive
bidding, and at maturity their par amount will
be payable without interest.
Both series of bills will be issued
entirely in book-entry form in a minimum amount of $10, 000 and in
on the records either of the Federal
any higher $5, 000 multiple,
Reserve Banks and Branches. or of the Department of the Treasury.
The bills will be issued for cash and in exchange for Treasury
bills maturing September 13, 1990. Tenders from Federal Reserve
Hanks for their own account and as agents for foreign and international monetary authorities will be accepted at the weighted
Addiaverage bank discount rates of accepted competitive tenders.
to
Federal
issued
Reserve
be
bills
may
Banks,
tional amounts of the
monetary authorities,
to
as agents for foreign and international
the extent that the aggregate amount of tenders for such accounts
exceeds the aggregate amount of maturing bills held by them. Federal
Reserve Hanks currently hold S1, 545 million as agents for foreign
and S4, 378 million for their
monetary authorities,
and international
maintained
to
be
bills
on the book-entry
for
Tenders
own account.
should
be submitted on Form
records of the Department of the Treasury
pD 5176-1 ( for 13-week series ) or Form PD 5176-2 ( for 26-week series ) .

TREASURY&S

13 — 26-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury's single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
and report daily to the Federal
securities
markets in Government
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.

noncompetitive bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of
A

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY&S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 154. Fractions may not be used.

bidder, as defined in Treasury s single bidder guidelines, shall
not submit noncompetitive tenders totaling more than $1, 000, 000.
and dealers who make primary
Banking institutions
markets in Government securities and report daily to the Federal
Reserve Bank of New York their positions in and borrowings on
such securities may submit tenders for account of customers, if
the names of the customers and the amount for each customer are
furnished.
Others are only permitted to submit tenders for their
own account.
Each tender must state the amount of any net long
position in the bills being offered if such position is in excess
of $200 million. This information should reflect positions held
as of one-half hour prior to the closing time for receipt of
tenders on the day of the auction. Such positions would include
bills acquired through "when issued" trading, and futures and
forward transactions as well as holdings of outstanding bills
with the same maturity date as the new offering, e. g. , bills
with three months to maturity previously offered as six-month
bills. Dealers, who make primary markets in Government securities and report daily to the Federal Reserve Bank of New York
their positions in and borrowings on such securities, when submitting tenders for customers, must submit a separate tender for
each customer whose net long position in the bill being offered
exceeds $200 million.
A noncompetitive
bidder may not have entered into an
agreement, nor make an agreement to purchase or sell or otherwise dispose of any noncompetitive awards of this issue being
auctioned prior to the designated closing time for receipt of

tenders.

Payment for the full par amount of the bills applied for
must accompany all tenders submitted for bills to be maintained
on the book-entry records of the Department of the Treasury.
A cash adjustment
will be made on all accepted tenders for the
difference between the par payment submitted and the actual

issue price as determined

in the auction.

deposit need accompany tenders from incorporated banks
companies and from responsible and recognized dealers
in investment securities for bills to be maintained on the bookentry records of Federal Reserve Banks and Branches.
No

and

8/89

trust

TREASURY'S

13-, 26-,

AND

52-MEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99 923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.

If a bill is purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.
of the Treasury Circulars, Public Debt Series
Nos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page 3

Public announcement will be made by the Department of the
Treasury of the amount and yield range of accepted bids. Competitive bidders will be advised of the acceptance or rejection
of their tenders. The Secretary of the Treasury expressly
reserves the right to accept or reject any or all tenders, in
whole or in part, and the Secretary's action shall be final.
Subject to these reservations, noncompetitive tenders for each
issue for $1, 000, 000 or less without stated yield from any one
bidder will be accepted in full at the weighted average bank
discount rate (in two decimals) of accepted competitive bids
for the respective issues. The calculation of purchase prices
for accepted bids will be carried to three decimal places on the
basis of price per hundred, e. g. , 99.923, and the determinations
of the Secretary of the Treasury shall be final.
Settlement

for accepted tenders for bills to be maintained

on the book-entry records of Federal Reserve Banks and Branches
must be made or completed at the Federal Reserve Bank or Branch
on the issue date, in cash or other immediately-available
funds
or in Treasury bills maturing on that date. Cash adjustments
will be made for differences between the par value of the
maturing bills accepted in exchange and the issue price of the
new

bills.
If a bill is

purchased at issue, and is held to maturity,
the amount of discount is reportable as ordinary income on the
Federal income tax return of the owner for the year in which
the bill matures.
Accrual-basis taxpayers, banks, and other
persons designated in section 1281 of the Internal Revenue Code
must include in income the portion of the discount for the period
during the taxable year such holder held the bill. If the bill
is sold or otherwise disposed of before maturity, any gain in
excess of the basis is treated as ordinary income.

of the Treasury Circulars, Public Debt Series
Nos. 26-76, 27-76, and 2-86, as applicable, Treasury's single
bidder guidelines, and this notice prescribe the terms of these
Treasury bills and govern the conditions of their issue. Copies
of the circulars, guidelines, and tender forms may be obtained
from any Federal Reserve Bank or Branch, or from the Bureau of
Department

the Public Debt.
8/89

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL

LICENSE NO. 10

letion of Certain Transactions Involvin
Acce tances and Other Irrevocable Undertakin
Com

(a)

Persons other than the Government

Bankers

s.

of Iraq

'hnd

the

of Kuwait are authorized to buy, sell and satisfy
obligations with respect to bankers acceptances, and to pay
under deferred payment undertakings,
involving the
importation or exportation of goods to or from Iraq or
involving an interest of the Government of Iraq or the
Government of Kuwait, as long as the bankers acceptance was
accepted or the deferred payment obligation was incurred
prior to 5:00 a. m. Eastern Daylight Time ("EDT"), August 2,
1990.
(b) Persons other than the Government of Iraq and the
Government of Kuwait are authorized to buy, sell and satisfy
obligations with respect to bankers acceptances, and to pay
under deferred payment undertakings,
involving the
importation or exportation of goods to or from Kuwait that
do not involve an interest of the Government of Iraq or the
Government

of Kuwait, as long as the bankers acceptance was
accepted or the deferred payment obligation was incurred
prior to 8:55 p. m. EDT, August 9, 1990.
(c) Nothing in this license shall authorize or permit
Specific licenses for the
a debit to a blocked account.
Government

debiting

of a blocked account

may

be issued on a case-by-

case basis.
(d)

Terms used in

this license are defined as follows:

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSETS CONTROL
KUWAIT ASSETS CONTROL REGULATIONS
GENERAL LICENSE NO. 10

letion of Certain Transactions Involvin
Acce tances and Other Irrevocable Undertakin
Com

(a)

Persons other than the Government

Bankers

s.

of Iraq

'hnd

the

of Kuwait are authorized to buy, sell and satisfy
obligations with respect to bankers acceptances, and to pay
under deferred payment undertakings,
involving the
importation or exportation of goods to or from Iraq or
involving an interest of the Government of Iraq or the
Government of Kuwait, as long as the bankers acceptance was
accepted or the deferred payment obligation was incurred
prior to 5:00 a. m. Eastern Daylight Time ("EDT"), August 2,
Government

1990 '
Persons other than the Government

(b)

of Iraq

of Kuwait are authorized to buy, sell and
obligations with respect to bankers acceptances, and
involving the
under deferred payment undertakings,
importation or exportation of goods to or from Kuwait
do not involve an interest of the Government of Iraq
Government

and

the

satisfy
to pay
that
or the

of Kuwait, as long as the bankers acceptance was
accepted or the deferred payment obligation was incurred
prior to 8:55 p. m. EDT, August 9, 1990(c) Nothing in this license shall authorize or permit
Specific licenses for the
a debit to a blocked account.
Government

debiting

of

a blocked

account

may

be issued on a case-by-

case basis.
(d)

Terms used in

this license are defined as follows:

(1)

The term "Government
(A) The

well as any

state

the Government

and

political subdivision,

agency,

thereof, including

instrumentality

{B)

Any

has been,

or

association,
substantially

corporation, or other organization
controlled by the foregoing;

is, or

owned

or

to the extent that such person

or to the extent that there

cause to believe such person

of Iraq, as

the Central Bank of Iraq;

partnership,

(C) Any person

of Iraq" shall mean:

is,

is reasonable

or has been, since the

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

within

by

other person or organization

the Secretary of the Treasury to be included

this section.
(2) The term "Government of Kuwait" shall mean:
of Kuwait or
(A) The state and the Government

any

entity purporting

well as any

to be the

political subdivision,

instrumentality

of Kuwait, as
agency, or
the Central Bank of

Government

thereof, including

Kuwait;
(B) Any partnership,

corporation, or other organization
controlled by the foregoing;

association,
substantially

owned

or

to the extent that such person
is, or has been, or to the extent that there is' reasonable
cause to believe such person is, or has been, since the
(C) Any person

(1)

(A) The

well as any

state

agency,

thereof, including
{B)

Any

association,
substantially

corporation, or other organization
controlled by the foregoing;

is, or

or

the Central Bank of Iraq;

partnership,

(C) Any person

of iraq, as

the Government

and

political subdivision,

instrumentality

of Iraq" shall mean:

The term "Government

owned

or

to the extent that such person

to the extent that there is reasonable

has been, or

cause to believe such person

is,

or has been, since the

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

by

other person or organization

the Secretary of the Treasury to be included

within this section.

(2) The term "Government of Kuwait" shall mean:
of Kuwait or
(A) The state and the Government
any

to be the

entity purporting

well as any

Government

political subdivision,

instrumentality

thereof, including

agency,

of Kuwait, as
or

the Central Bank of

Kuwait;

(B)

Any

partnership,

corporation, or other organization
controlled by the foregoing;
(C) Any person

is, or

has been, or

association,
substantially

owned

or

to the extent that such person

to the extent that there is reasonable

cause to believe such person

is, or

has been,

since the

I

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

by

other person or organization

the Secretary of the Treasury to be included
r~

within

this section.

"deferred payment" shall mean a
payment to be made under a letter of credit at a maturity
date specified by or determinable from the wording of the
credit, but not involving the acceptance of a tenor draft,
(3)

and

is as

Documentary

Issued:

R. Richard

The term

used in the Uniform

Credits,
August

Customs

1983 Revision,

30, 1990

ewcomb

ector
Office of Foreign Assets Control
Di

and

ICC

Practice for

Publication

No.

400.

I

effective date, acting or purporting to act, directly or
indirectly on behalf of any of the foregoing, and
(D) Any

determined

other person or organization

Secretary of the Treasury to be included

by the

F

within

this section.

"deferred payment" shall mean a
payment to be made under a letter of credit at a maturity
date specified by or determinable from the wording of the
credit, but not involving the acceptance of a tenor draft,
(3)

and

is as

Documentary

Issued:

R. Richard

The term

used in the Uniform

Credits,
August

Customs

1983 Revision,

30, 1990

ewcomb

ector
Office of Foreign Assets Control
Di

and

ICC

Practice for

Publication

No.

400.

DEPARTMENT OF THE TREASURY
WASHINGTON

OFF ICE OF FORE IGN AS SFTS CONTROL
ASSETS CONTROL REGULATIONS
IRAQI SANCTIONS REGULATIONS

KUWAITI

GENERAL

11

LICENSE NO.

r'

~

Im

ortation of Household
The

Personal

of the household

importation

Iraqi or Kuwaiti origin,
family

and

including

use, of a person arriving

or indirectly

from

effects

in such

provided

they were actually

otherwise

for

prohibited

any

may

and

in the United

be imported

without

used by such person

Newcomb

Director

Office of Foreign Assets Control

or Kuwait.

effects of
articles for
States directly
Articles
limitation
or family

other person or for sale,

from importation.

Ira

personal

and

baggage

Issued.

R. Richard

from

Iraq or Kuwait is authorized.

included

are not intended

Effects

and

abroad,

are not

DEPARTMENT OF THE TREASURY
WASHINGTON

OFFICE OF FOREIGN ASSFTS CONTROL
ASSETS CONTROL REGULATIONS

KUWAITI

IRAQI SANCTIONS
GENERAL

Im

ortation of Household
The

Personal

including

use, of a person arriving

or indirectly

from

effects

in such

provided

they were actually

otherwise

for

prohibited

from

any

may

and

in the United

be imported

without

used by such person

Newcomb

Director

Office of Foreign Assets Control

or Kuwait.

effects of
articles for
States directly
Articles
limitation
or family

other person or for sale,

from importation.

Ira

personal

and

baggage

Issued:

R. Richard

Effects

Iraq or Kuwait is authorized.

included

are not intended

11

LICENSE NO.

of the household

importation

Iraqi or Kuwaiti origin,
family

and

REGULATIONS

and

abroad,

are not

DEPARTMENT OF THE TREASURY
1h'ASHIN~ON

SEP 26 1o30
Or r ZCE OF FOHZXGÃ ASSETS CONTROL
KUbATT7. ASS - TS COh CAROL R GU~MTZONS
ZRLQZ SANCTIONS R- QM~TZONS

GYRAL

i 0?.'s
(a)

od

LXCZZS"

v

o

Specific licenses

v

Pii

may

NO

~

L2

~'nc'

bc issued on a case-by-case

basis to permit expo~~ation to Xrac or Kuwait of donated
food. , intended to relieve h~, an suffering, whe e Dc sEipmen
of foodstuffs has been au&orixed by the Security Council of
~&e Cni e5 Nations o- a duly auJ orized body sD~o d. &nate
Mere o ac in' pursuant to, an" M acco dance wi&, the
provisions of 'United Nations Security Council resolution 666
(1990), a copy of which is attached he eto. Au&orkxa ion
will be souci from the Qnited Nations Security Council or
&uly au ho ized subordinate body by the United 5 ates
el owing application to Zis 0 ice wee w&c the requirements
of subsection (c) of this license.

subject to paragraph (a), specific
Rice mes wi11 only be own ed for dona ions o food to be
provid. ed d.rough the United Nations
cooperation with the
Zn ewational
Committee of the Red Cross or othe appropriate
u ed by them or under their
humanitarian
agencies and dist
supe Yi sion, or in such other mene as ma@ be app oved a~8. er
Qn ted &a ions Security Council resolu ion 66$ (1990), in
(b)

n gene

al,

and

w&

A~

'

DEPARTMENT

0|' THE TREASURY

1h'ASHllC~ON

BEP 26
OFFICE

0"

MSETS

FOBZEGÃ

19SO

CONTROL

ASS TS COb tROL R GUDTIONS

KUbAZTZ
ZRLQZ

SANCTIONS

3- QM~TXOh'S

GEK=RAL LZCENS - NO

f

ona ious

od

o

~

X2

v»'nc'

3

case-by-rase
bas's to permit expo~ution to Xrac or Kuwait of donated
food, in ended to elieve hu-Lan suffering, whe e De shipmen
of foocstuffs has been authorized by the Sec'wity Council. 1 of
~&e Cni e5 ovations or a duly auJ orize5 body subo d. ihate
De e o ac ing pursuant to, an" B acco dance wiZ, the
provisions of United Nations Security Council resolution 666

Specific licenses

(a)

may

bc issued on

a.

of which is attached he eto. Au&oriza ion
w-'ll be sough from the 'Uni ed Nations Securi y Council or
ates
y au ho ize8 subordinate body by the United S

('990),

a copy

ol owing application to this O ice
of subsec ion (c) of this license.

meet&mcr

the re~i»emen

s

subject to paragraph (a), soecific
licenses wi11 only be cmn e8 for dona ions of food to be
coopers ion with the
proviC. ed trough the United Yations
'Zntewational Cozzaittee of the Red Cross or othe appropriate
agencies and dist A&u ed hy them or un'. er their
humanitarian
(b)

Zn

gene

al,

and

z&

in such othe» @anne» as may be app oved u~8er
in
Qnited Fa ions Security Council resolu ion 66$ (l990),

suoewision,

o

order to ensu e that such donai|ohs reach the untended

beneficiaries.
(c) Applica iohs o specific licenses pursuant to
pa-ag-aph (a) shall be mcde in advance of We proposed
exyo~a. ion, and provide notice and evidence of:
(1)

of the

dona ied

(2)

dis

Ae nature,

food;

auantity,

value, and inteeded use

and

compliance

w

D

such

te~

and condit& ohs

of

D~utioh as 58$ have heLq adopted hy the United Nations

Secu=ity Council o- duly autho ized subordinate body to
govern Ze s+~pment o foodstuffs under applicable Vn& ied
Ãa ious Secuzi y Counci
resolutions, «wcludw&g resolutions
661 (1990) and 666 (" 990) .

issued: Sap
I

ember

'I

26, 1990

/

R/ Richard Ãewcomb

Six.ector

Office of Foreign Assets Consol

orde=

such dona j.ons reach the w&tended

o ense e t&a

beneficiaries.
o soeci+ic 1&censes euz. suan' to
(c) Avalica-ions
pa-agmph (a) shaLl be mdc in advance of Ae proposed.
expo~a. ion, md prov'de notice and evidence of:

(1) the nature,

~e

of

donated

(2)

dis-

ution as

D&

cgantity, value, and intended use

food; and
collop'
may

Secu=ity Council o-

iance

w

Z

such

te~

and

conditions

of

have beer adopted by the United Nations

ly au ~o ized subordiza e bodv to
govern the s&~peen o foodstu fs usher applicable United
Natiors Security counc' resolutions,
clud~~ a resolutions
661 (1990) and 666 (1990
5-

w&

Issued: Sap
I

26,

1,990

\

R.' Richard
Director
,

ember

Ãevcomb

Office of Foreign Assets Consol

10 '0

VOREI& ASQTS

~«pk

@002

DEpARTMENT OF THE TREASURY
WASIEtN~ON

OtlT

-4 193P

OFFICE OF FOREIGN ASSETS CONTROL
IRAQI SANCTIONS R:GUZATZONS
GENERAL LICENSE NO.

standby

etters

c

d.

t

d

(a) Notwithstanding
any oAer provision of law, payment
into a blocked account in a Zf. S. financial institution hy an
issuing or confirming bank under a standby letter of credit in
pmhibit»d if »ith»r (1) a
specific license -has been issued-. pursuant to the -provisions
favor of an Iraqi entity

is

of

of this license or (2) ten business days have
not expired. after notice to the account party pursuant to
paragraph (b) of this license.

paragraph

(b)

or confirming bank shall receive
such demand for payment under such a standby letter of credit,
it shall promptly notify the account party. The account party
may then apply within five business days for a specific
license authorizing the account pa~+ to establish a blocked
account on its books in the name of the Iraqi beneficiary in
the amount payable under th» credit, in lieu of payment by the
(b)

Whenever

an issuing

into a blocked account and
e
?ehabursement therefor hy the account party. Eothing in this
license mlicv»s any such bank or such account party from
giving any no ice of defense against payment or reimbursement
that is recpired by applicable lav(e) Where there is ouw~ding a demand for payment
under a standby letter of credit, and the issuing or
issuing or confirming

bank

10 '05

'

AS+S

+'ORE1G~

~~

~002

F4

DEPARTMENT OF THE TREASURY
WASH IN

~O N

OCT-a

&iso

OFFZCE OF FOREIGN ASSETS CONTROL
SAN CTZONS RZGULLTZONS
GENERAI LICENSE NO

ZRAQZ

in stancibv

etters

c

dZt

e

d

o

any oAer provision of law/ payment
(a) Notwithstanding
into a blocked. account, in a Q. S. financial institution by an
issuing or confirming baze under a standby letter of credit in

favor of an Iraqi entity

is p~hibited if either (1)

a

specific license -has been issued-. pursuant to the -provisions of
paragraph (b) of this license or (2) ten business days have
not expired after not ce to the account party pursuant to
paragraph (b) of this license.
or confirming bank shall receive
such demand for payment under such a standby letter of credit,
it shall jrozzptly notify the account party. The account party
may then apply within five business days for a specific
license authorizing the account pa~~ to establish a blocked
account on its books in the name of the Iraqi beneficiary 1a
the amount payable under the credit, in lieu of payment hy the
(b)

Whenever

an issuing

into a blocked account and
o
in this
Eothing
account
party.
the
reimbursement therefor hy
license relieves any such han3c or such account party from
giving any no ice of defense against payment or reimbursement

issuing or confirming

that

is
(c)

bank

required by applicable
Where

under a standby

law-

there is ourn~ding

letter of credit,

and

a

demand

for

payment

the issuiny or

con irming bank has been enjoined

from ma3~g payment,

upon

of the injunction, the account party may apply ~or &
specific license for Me same purpose and in the same Mtnner
as that set forth M paragraph (b) of this license. The
payment under the
issuing or confMaizxg bank ah&1 not
standby letter of credit unless (l) tea business CLays have
expired since the hank has received notice of the removal of
the injunction and (2) a specIfic license issued to the
account par& pursuant to the provisions of this paragraph has

removal

~e

to the hank.
necessary to assure

not:been. -presented

If

(d)

dxe

availability

blocked, the Secretary of the Treasury

the

payment

of the

amounts

due under

may

any

of the

~ds

at, any time raqu&e

letter of credit

desc ibed in paragraph (a) of this license is&to a blocked
account in a U. S. financial institution or the supplying of
any form

of security

deemed

necessary.

in this license precludes the account party
on any standby letter of credit or any other person from at
any time con~sting the legality of the demand from the Iraqi

(e)

Nothing

beneficiary or from raising any other legal defense to payment
under the standby letter of credit,
(f) This license does not affect the obligation of the
various parties to the instruments covered, by Mis license if
the instnunent. s and payments thereunder are subsequently

.

unblocked.
(g)
reimburse

~l

This license does not author5. ae any U. S. person to
a non-U.

S.

bank

for

payment

to

an

Iraqi beneficiary

10/05/QO

11:05

~377

7221

con irming bank has been en$oineD from ma3~g payment,

upon

of the mjunction, the account party may apply for a
specific license .for Me same purpose and in the same manner
as that set forth M paragraph (b) of this license. The
issuing or confixuMg bank sha11 not make payment under the
standby letter of credit unless (1) ten business Cays have
expired since the hank has received notice of the removal of
the &)unction and (2) a specific license issued to the
account party pursuant to the provisions of this paragraph has
not:been -presented-to the hant.
(d) If necessary to assure dxe availability of the Mds
blocked, the Secretary of the Treasury may at any time reeve
the payment of the amounts Cue under any letter of credit
desc ibex' in paragraph (a) of this license into a blocked
account in a U. S. financial institution or the supplying of
any form of security deemed necessary.
(e) nothing M this license precludas the account party
on any standby letter of credit or any other person from at
any time contesting the legality of the demand from the Iraq[i
beneficiary or from raising any other legal defense to payment
under the standby letter of credit.
(f) This license does not affect the obligation of the
various parties to the instruments covered by Mis license if

removal

the instnznents

and payments

thereunder

are subsequently

unblocked.
(g)
reimburse

This license does not authorize

any U

S.

person

to

a non-V-S. hank for payment to an Iraqi beneficiary

~37i

1l:06

]0 '05 'QO

under a standby

FORE IP. hSS

'TZZl

letter of credit, except

S

~i

by piyments

blocked account in accordance vith paragraph

@004

1'h

into a

(b) or (c)

of

this license.
(h)

FaragraPh

A

person receiving a specific license under

(b) or (c) of

this 1ieeese shall certify to the

Office of Foreign Assets Control vIthin five business days
after receipt of the specific license that it has established
the blocked account on

its

boo3cs

as provided in those.

Eowever, in appropriate cases, this time period
paragraphs.
Office of Poreign
may be extended. -uponwpplica&on-to-the

Assets Control

when

with an appropriate

the

accost

party has filed a petition

couW se&wng a Judicial order barring

by the issuing

or confirming bank.
(i) The extension or renewal of a standby letter of
credit is authorized.
(9) Terms usecL in this license are defined as follows:
(1) The term "standby letter of credit" shall
mean a letter of credit securing performance of, or repayment
of any advance payments or deposits under, a contract, or any
similar obligation in the nature of a performance bond.
(2) The term ~account party" shall mean the

payment

person

for vhose account the

standby

letter of credit fs

opened.

(3) The term "U. S. financial institution" shall
mean any U. S. person (including foreign branches) that is
engaged in the business of accepting deposits or making,

]0'05 '90
~

~J

11:05

I

under a standby

(7i

7zzl

FOREIP. hSS

letter of credit, except

S

~+ Vh

by payments

blocked account in accordance with paragraph

@004

'

&to a

(b) or (c)

of

this license.
(h)

A

person receiving a specific license under

(b) or (c) of this license shall certify to ~e
Office of Foreign Assets Control within five business days

Paragraph

after receipt of the specific license that,
the blocked account on

its

boo3cs

it

has established

as provided in those

cases, this tMe period
may be . extended. -uponwpplicaUon-&o-the
Office of foreign
Assets Control when the accost pazty has filed a petition
with an appropriate couW se&wng a gaud. icial order barring
payment by the issuing or confirming bank.
(i) The extension or renewal of a standby letter of
credit is authorized.
(3) -- Terms used isa thfs license are defined as follows:
(1) The tenn "standby letter of credit" shall
mean a letter of credit securing performance of, or repayment
of any advance payments or Ceposits under, a contract, or any
similar obligation in the nature of a performance bond.
(2) The term "account party" shall mean the
person for whose account the standby letter of credit fs
paragraphs.

however,

in appropriate

opened.

(3) The term "U. S. financf. al insti~tion" shall
mean any U. S. person (iaclucting foreign branches) that is
engaged in the business of accepting deposits or making,

transferring, holing, or brokering loans &r
credits, or of purchasing or selling foreign ~change.

granting,

futures or

-commodity

purchasers
opens, or .procuringincluding,

se11c~ thereof l ~ pr1 cipal or agent,
limited to, banks, savmgs ban3cs, trust
brokers and dealers, commodity

fu~es

but
companies,

and

a~

securities

and options brokers

and

dealers, forward contract and foreign exchange xaerchantsi
securities end commodities exchanges, clearing corporations,
investment companies, employee benefit plans, and U. S. holding
companies, V. S. affiliates, -or U. S. .subsiCLiaries of any of the

foregoin
(4) The term ~blocked account" shall mean an

account with respect to which payments, transfers or vithdrawals, or other dealings may not be made or effected except
pursuant

to

an

Foreign Assets

Issued:

authorization

coal

October

R. Richard

~,

Hewcomb

or license from the Office of

authorizMg

1990

D'rector
Office of Foreign Assets Control

such

action.

LUiUQ i 5U

~

LL: UO

s)

I I

iCCL

g

U~Lyw gO JZ. L 0

transferriag, holding, or brokeriug loans er
credits, or of purchasing or selling foreign exchange,
. -commodity futures or opMns, or .procuring purchasers
and
se11ers thereof, as principal or agent, including, but not
limited to, hanks, savings harQcs, trust companies, securities
Wanting,

brokers

azure

ctealers, commodity

dealers, Korward contract
securities and commodities

futures and options brokers and

foreign exchange merchantsi
exchanges, clearing corporations,
employee henefit plans, and U-S. holing

investment

companies,

companies,

v. S. affiliates,

and

-or U.

s. .subsidiaries

of

any

of the

foregowg
(4) The term

hloc)ced account" shall mean an

transfers or vithdrawa?s, or other dealings may not he made or effected except
pursuant to an authorization or license from the Office of
Foreign Assets Control authorizing such action.
account with respect to vhich payments,

Issued:

Octeber

R. Richard

~,

Hewcomb

1990

D'rector
Office of Foreign Assets Control

r. lo

gl:g6

Q, 9b

~

~ ~

. '.

57

0
(q -2(
~

~

r

S

I

~

~

~

~ ~

t-'

KITED
ATJONS

~

r

;

~

&s

~

Security Council

~~

~, bie«

e

~

~

~

~

S~~/46d (1005)
D Sop
LS%0

~r

r
~~

~~ s«~ ~

ques . «t « J't ~ '

r

m5C a-TM 040 &'%}C)
r~e ««te
gm 8 0

~«e,

t

~»

sr

~es5

g 'Oh 541 ( 9'f0) g PL-Le LPh5 5 {C) CL 4 0 Vh«oh

egO

bea~~ta Ca-

Cn

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Removal Notice
The item identified below has been removed in accordance with FRASER's policy on handling
sensitive information in digitization projects due to copyright protections.

Citation Information
Document Type: Transcript

Number of Pages Removed: 18

Author(s):
Title:

Press Conference with Nicholas Brady

Date:

1990-09-05

Journal:

Volume:
Page(s):
URL:

Federal Reserve Bank of St. Louis

https://fraser.stlouisfed.org

gghS+p

Pepartment

of the Treasury

~

Bure''d of the

ut51ic Debt'

FOR RELEASE AT 3:OO PM

~

Washington,

DC 20239

+&zc

o+

Contact: Peter Hollenbach
(202) 376-4302

September 7, 1990

PUBLIC DEBT ANNOUNCES ACTIVITY FOR
SECURITIES IN THE STRIPS PROGRAM FOR AUGUST 1990
Treasury's Bureau of the Public Debt announced activity figures for the month of August 1990, of
securities within the Separate Trading of Registered Interest and Principal of Securities program,

(STRIPS).
Dollar Amounts in Thousands
Principal Outstanding
(Eligible Securities)
Held in Unstripped

$451,060, 835

Form

$341,511,055

Held in Stripped Form

Reconstituted

$109,549,780
$4, 473,560

in August

The accompanying table gives a breakdown of STRIPS activity by individual loan description.
The balances in this table are subject to audit and subsequent revision. These monthly figures are
included in Table VI of the Monthl Statement of the Public Debt, entitled "Holdings of Treasury
Securities in Stripped Form. " These can also be obtained through a recorded message on
(202) 447-9873.

oOo

pg, hS+p

Pepartment

of the Treasury

~

Bure''d

o'f the I ublic

Debt''

~

FOR RELEASE AT 3:OO PM

Washington,

DC 20239

+ZIC Q+

Contact: Peter Hollenbach
(202) 376-4302

September 7, 1990

PUBLIC DEBT ANNOUNCES ACTIVITY FOR
SECURITIES IN THE STRIPS PROGRAM FOR AUGUST 1990
Treasury's Bureau of the Public Debt announced activity figures for the month of August 1990, of
securities within the Separate Trading of Registered Interest and Principal of Securities program,

(STRIPS).
Dollar Amounts in Thousands

$451,060, 835

Principal Outstanding
(Eligible Securities)
Held in Unstripped

$341,511,055

Form

$109,549,780

Held in Stripped Form

Reconstituted

$4, 473, 560

in August

The accompanying table gives a breakdown of STRIPS activity by individual loan description.
The balances in this table are subject to audit and subsequent revision. These monthly figures are
included in Table VI of the Monthl Statement of the Public Debt, entitled "Holdings of Treasury
Securities in Stripped Form. " These can also be obtained through a recorded message on
(202) 447-9873.

oOo

TABLE VI

31, 1990

HOLDINGS OF TREASURY SECURITIES IN STRIPPED FORM, AUGUST
(In thOuaanCIB)

27

PHnctpat Amount Outstanding

Portion Held in
Stripped Form

Portion Held in
Unstripped Form

Reconstituted
This Month I

$1,156,MO

$137,MO

Nots A-1995 . .

. . . 11/1 $94. . .
. . . 2/15/95

$5.501.754

1 t-t/44S

6.033,M1

6, 425, 381

508, 4SO

-0-

1 t. t/44tr

Note B-1095

..

. . . 5/1$06

7, 127,088

5, 558, 768

1,588, 320

01/2% Nots C-1005

..

. . . 8/15/05

7,955,901

7.291.901

. . . 1 1/1 $05. . .

7,318.550

S.SOO, 1SO

816,400

6-7/8% Note A. 1008 . . .

. . . V1$M

8, 575, 199

. . . $1$M

8.343, 100
10.5M, 443

232.000

7~tttr

. 11/1$08. . .
. . . 5/1 $07
. . .8/1$07
. . . 11/1$07. . .
. . .2/1 NM
. . .5/l $08
. . .8/1$M
. . . 11/1$M. . .
. . .2/1$90
. . .$1$00

20~, 810

19,982,610

298,000

0, 021 W7

9,S48, 037

73,200

9,382, 838

9,382, 836

-0-

1,M8. 329

0, 792.320

18,000

0, 159.088

Q, 1 58,428

1,186,387
11,342, 846

11.214,848

0,002, 875

9,848, 476

9,71 1,828

0,718,428

10,047, 103

9, 178.303

. . . N1$90

10, 183,644

10,0$1,844

. . . 11/1$91. . .

C-1094 . .

11-5lbtttr Note

0.1095

+1/2rttr Note

Nots C-lgQS . . .

7.1/44S Nots

0 1098

S-t/2ttcr Note

A-1007 . . .

.

4-1007

6-5/Stttr Note

6-7/Sstr Nots C 1MT

...

S-t/8% Nots A. 1008 . . .
944 Nots B-10M .

. ....

Q. t/4%% Note

C-1998

6-7/8%tr Nolo

0-1098 . . .

6-7/Stttr NoN

A-1000 . . .

Q. t/Stttr Nolo

B1000 . . .

8% Nots C-1990 . . . . .

0.1099

12.000

400.200

1,135,3S7
128.000

~,000

-0-0-0-0-0-0-0-0-0-0-0-0-0-0-

10,773,080

10,841, 180

124.MO

S.t/2tttr

Nolo A-2000

. 2/1NM

10.873,033

10,573.033

-0-

6.7/844

Note 4-2000 .

.$1$00
.8/1 $00

10,408, 230

10,485, 030

11,200

11,0M, 868

11,080, 558

-0-

11/15O4 . .

6, 301.808

3,830,408

4, M2. 400

5/1$M

4, 2M, 758

1,788,058

2, 404, 700

0~,713

8,384,113

M4. 800

4, 755,918

4, 75S,018

-0-

8.008,544
12.M7.790

1,527,M4

4,477, MO

2, 372.119

10,295,MO

st 3,440

7, 140,018

2, 185,018

4, 084, 000

303.380

8,800, 860

2, 0M, 450

4, 830.400

62,600

7-7/6%tr Note

..

IW/4% Nots C-2000
1 1-Nbtitr

12ritr

Bond

Bond

2004.

2005.

t(LV4%tr Bond

2005. . .

. . .2/1 $08
t M/4rttr Bond 2000 14 . .

t.t/4%

Bond 2015 . .

1CH5/8%tr

Bond 2015 . .

1

9.7/8&

Bond 2015 . .

9 t/4rib

Bond 2018 . .

7-1/4% Bond 2018 . .

7.1/2%

BOnd

2016 . .

2017. .
8 7/844 Bond 2017 . .
Q. t/Stitr Bond 2018 . .
9% Bond 2018. . . . .
$.7/8%tr Bond 2019 . .
S.t/Srttr Bond 2010. . .
8-1/2%4 Bond 2020. . .
M/4% Bond 2020. . .
M/4% Bond 2020. . .

MI4rttr Bond

Total

. . . 11/1$14. .
. . .2/1 Sit d
. . .4/1$1d
. . . 1 1/1 5/1 6 . .
. . . 2/15/1 4
. . . $15/18

47, 000

7488, 854

8, 111,454

18,823.551

17,007,551

1,818,000

. . .11/1$18 . .
. . .6/1$17

18,884, 448

12,222, 528

8,841,020

14, 104,180

4, 304, 1 8Q

11,800,000

. . .8/1 $17
. . . 5/15/1 8
. . . 11/15/18 . .

14,018,858

6,072.058

5,044, 800

8, 708,830

3,438,230

5,270, 400

0,032,870

1,7M, 270

7,2M, SOO

132,000

. . .2/1 5/10

11,250, 703
20413,632

4, 577, 103

14,873,801

241,8$

11,001.592

Q, 1 22+40

MT, SM

4, 5854M

6,M3.600

470.600

8.628.483

1,330,400

124,000

10,460, 483

10,450.483

-0-

-0-

461,080,835

341,S11,055

$15/10

. .2/1$20
..

$20
. .6/1 $20
5/1

042b, 888
10,168,M3
1

Effecthte May 1 1087 securities held In stripped lonn were etlgtbte lor reconstitution

Nots: Qn the 4th wortcday of each month a recording ol Table 1/I w9t be evaNast after
The balances in this table are sub|act to aude and subsequent ecbustntents.

to their unstrtpped

4, 473,580

form

3:00 pm. The elsphone

number

105,720

is (202/

447~.

TABLE VI~OLDINGS OF TREASURY SECURITIES
(In thOuaanda)

IN

STRIPPED FORM, AUGUST 31, 1990

PHnctpaf Amount Outstanding

ftsconsdhdsd
Pordon Held in
Stnpped Form

Portion Held in
Unstripped Form

..

11-5lbbb Note C-1994

. . . 1 fn$/94.
.2/1 5/85

11,156,MO

1137.800

-0-

6.425, 381

. . . 5/1$96

7, 127,088

5, $58, 768

1,588,320

01/2%b Nots C-1995 . .

Q-t/2' Note 0-1995

. . . 8/15/95

7, 955,901

7, 291,901

...

. . . 11/1$96. . .

7,318.550

6, 5OO, 15O

..

. . . 2/1$98
. . . $1$98
. . . 11/1$98. . .
. . .5/1$97
. . . 8/15/97
. . . 11/1$97. . .
. . . 2/1$98
. . . $1$98
.$1$M

8, 575.199

6-7/tptb Note A. 1898 .

T~bb

Note C-1888

0.1996

...
..

.

S.f/2ttb

Note A-1997 . .

.

S.SISbb

Note

8.7/Seb
S.t/Sbb

Nots C-18QT.

7-1/4bb Note

Nolo A. 1998

Q-t/4%b Nolo

0-1998

8-7/Sbb Nolo

0-1998

6.7/tptb

.

.

..

...

8.1998

Note

Qbb

8.1997

8.1999

7.7/fptb Nots

0 1999 . .

S-t/24b Nots A-2000 . .
Note 8-2000

..

....
11-Nba Bond 2004. . . . .

63/4%b Nolo C-2000

12%b Bond

200$. . . . . . . .
2005. . . . .

1,800

19,962.810

4, 000

1.18S.387
11,342, 848

9.792,329
9, 158,42S
9.135,3S7
11,214,848

Q, Q02, 875

9,848, 476

9,71 1,821

9,718,428

9.159.088

18,000

$1$98

10,047, 103

9, 178.303

. . . N1$99

10, 183,844

1 0,081,844

S2,000

. . . 11/1$91 . .
. . .2/1NM
. . . $1$00
. . .6/1$00
. . . 11/1$04 . .

10,773,980

10,641, 180

124,800

10.873,033

10,873,033

-0-

10,498,230

10,4M. 030

11,200

11,0M, 8$8

11,080,858

-0-

8.301,808

3,S39,408

4, M2, 400

. . . 5/1$M
. . .2/1$M

..

8,343, 199

19.588, 443

9,382.S36

103/4%b Bond

114littb Bond 2008 14

0

1 2.

816,400

9,821,237

11/1$M . .

C-1999 . . . . .

Sbb Note

6 7/Sbb

20~, 810

NoN A-1999

Q-f/Sbb Nolo

I

15,501,754

..

8-1995

Nolo

1 1-1/4%b

Thi ~ Month

8.933,S81

..

508.480

11-1/ibb Note A-1995 .

27

. . .11/1$14 . .

-0-0-0-0-

-0-0-0-0-0-0-0-0-0-

1,7M, 058

9~,

2.484, 700

47.0af

713

8,384,113

884.MO

56,000

4, 755, 918

4.75S,818

-0-

-0-

8.006,684

1,527,884

4,477, MO

SQ, MO

12,887, 799

10,295.880

513,440

7, 148.118

2.372.119
2, 185,918

4, 984,000

303,3M

8, 898,869

2, 088.459

4, 830,400

Q.T/Seb Bond

2015 . .

. . .2/1$15
. . .8/1$15
. . . 11/15/15

Q. t/4bb Bond

2018 . .

. . . 2/15/18

854

8, 111,854

1, 155400

7-1/44b Bond 2018 . .

. . .$15/18

18.823.551

17,007, $51

1,S'18,000

. . . 11/15/18 . .
. . .5/1$17

18,884, 448

12.222. 528

8,641.920

18,194,189

11,800,000

. . .6/lb/17
. . . 5/15/1 8
. . . 11/1$18 . .
. . .2/15/19

14,018,8SS

8.394, 189
6.872, 058

S,TM, 839

3,438,239

5,270, 400

9,032.870
19,250, 793

1,788,270

7,288, 800

132,000

4, 577, 193

14,873,8W

2bt, leaf

. . . N1$11

20413,832

11,091.582

8, 122440

SST,SM

5M~

5,853.600

470, 800

10,168,883

8.628.483

1,330,400

124,000

10,468, 483

10.459,483

-0-

-0-

t l-t/4%b Bond 2015 . .
lfbb/Seb Bond 2015 .

7-1/2%b Bond

.

2018 . .

83/4eb Bond 2017. .
8-7/Ssb Bond 2017 . .

9.1/Sbb
Qbb

Bond 2018 . .

Bond 2018 . .

8.7/&bb

Bond 2019 . .

8-1/Sbb Bend 201Q . .

2020. . .
So/4bb Bond 2020. . .
83/4bb Bond 2020. . .

8-1/2'

Bond

. . . . .2/1$20
. . . . . $1$20

..

7',

1

042', 888

Total

1E/teeth/a

4,

5,044, 800

4,473, 580

341,S11,055
Msy 1

1187 secuntiss held

in stripped

form were sftQfbfs for reconstitution

Note: On the 4th wodcday of sech month ~ ecordtnQ of Table Vf will be available atter
The balances ln this table are sub/sot to aude and subeequenl edf~ents.

to their unstnppsd

form

3:00 pm. The slephone

number is

f20'

4474f873.

~g, h8+p

BLI 'DEBT
of the Treasury

Department

'of

( Bure/

tahe

Public Debt

... ;i, «".,'

RELEASE

FOR IMMEDIATE

September

~

10, 1990

O-. -py

E
~

Washington,

CONTACT:

+i, cc O+

DC 20239

Office of Financing
202/376-4350

Op ÃH

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

Tenders for $9, 200 million of 13-week bills and for $9, 233 million
26-week
of
bills, both to be issued on September 13, 1990, were accepted today.
OF ACCEPTED
COMPETITIVE BIDS:

RANGE

13-week bills
December 13
maturin
Discount Investment

Average

Tenders
Tenders

at the
at the

98. 135 : 7. 33%
98. 127: 7. 34%
98. 127: 7. 34%

7. 72%
7. 73%
7. 73%

96. 294
96. 289
96. 289

rate for the 13-week bills
rate for the 26-week bills

were
were

allotted 51%.
allotted 46%.

7. 62%
7. 66%c
7. 66%

7. 38%
7. 41%
7. 41%

Low

High

high discount
high discount

26-week bills
March 14 1991
maturin
Discount
Investment
Rate

1990

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)
Location
Boston
New

Received
$

39, 935
25, 505, 595
27, 130
48, 205

York

Philadelphia
Cleveland

171,570
31, 745

Richmond

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

Dallas
San Francisco
Treasury
TOTALS

1, 854, 510
32, 125

21, 365
41, 645
21, 320
932, 080
745, 730
$29, 472, 955

A~tee
$

ted

Received

39, 935

490, 910
14, 675

11,365
41, 645
21, 320
78, 345
745, 730
$9, 200, 080

~Te

$25, 473, 170 $5, 200, 295
1, 540, 195 1, 540, 195
Subtotal, Public $27, 013, 365 $6, 740, 490
Federal Reserve
2, 278, 255
2, 278, 255
Foreign Official
181, 335
181,335
In stitutions
$29 472, 955 $9, 200, 080
TOTALS
Competitive
Noncompetitive

thousand

1

$23, 096, 460
1, 322, 955
$24, 419, 415
2, 100, 000

$4, 596, 920
1, 322, 955
$5, 919, 875
2, 100, 000

1, 213, 565

1, 213, 565

:

$27, 732, 980

$9, 233, 440

$71, 465 thousand of 13-week bills and an additional $492, 435
of 26-week bills will be issued to foreign official institutions for

additional
new

23, 560
38, 760
43, 710
35, 510
1, 881, 695
27, 740
25, 495
48, 300
23, 180
902, 605
621, 840
$27, 732, 980

28, 855

24, 031, 730

31, 745

ted

28, 855
7, 803, 165
23, 560
38, 385
43, 710
35, 510
401, 695
19, 740
17, 395
48, 300
23, 180
128, 105
621, 840
$9, 233, 440

$

7, 594, 905
27, 130
48, 205
54, 170

~Acce

cash.
e e ~ ee

;r.t,=, ld

~f, hS gyp

BLI ""DEBT
Department

of the Treasury

~
I

Purj~

'bf tjhe Pub te Debt

FOR IMMEDIATE RELEASE

10, 1990

September

0'

l

T. Q;- tV,

-

'.

~

0
0

Washington,

DC 20239

Offi~~ of Financ
202/376-4350

RESULTS OF TREASURY'S WEEKLY BILL AUCTIONS

Tenders for $9, 200 million of 13-week bills and for $9, 233 million
of 26-week bills, both to be issued on September 13, 1990, were accepted today.
OF ACCEPTED
COMPETITIVE BIDS:

RANGE

7. 38%
7. 41%
7. 41%

Low

High

Average

Tenders
Tenders

13-week bills
December 13
maturin
Discount Investment

7. 62%
7. 66%
7. 66%

1990

98. 135
98. 127
98. 127

at the high discount rate for the
at the high discount rate for the

26-week bills
March 14 1991
maturin
Discount
Investment
Rate

7. 33%
7. 34%
7. 34/c
13-week
26-week

7. 72%
7. 73%
7. 73%

96. 294
96. 289
96. 289

were
were

allotted 51%.
allotted 46%.

bills
bills

TOTAL TENDERS RECEIVED AND ACCEPTED
BY FEDERAL RESERVE DISTRICTS

(In Thousands)
ted
Ance

Received

Location
Boston

Received

~Acce

ted

23, 560
38, 760
43, 710
35, 510
1, 881, 695
27, 740
25, 495
48, 300
23, 180
902, 605
621, 840

28, 855
7, 803, 165
23, 560
38, 385
43, 710
35, 510
401, 695
19, 740
17, 395
48, 300
23, 180
128, 105
621, 840

$27 732 980

$9 233 440

$25, 473, 170 $5, 200, 295
1, 540, 195 1, 540, 195
Subtotal, Public $27, 013, 365 $6, 740, 490
2, 278, 255
Federal Reserve
2, 278, 255
Foreign Official

$23, 096, 460
1, 322, 955
$24, 419, 415
2, 100, 000

$4, 596, 920
1, 322, 955
$5, 919,875
2, 100, 000

181,335

181, 335

1, 213, 565

1, 213, 565

$29, 472, 955

$9, 200, 080

$27, 732, 980

$9, 233, 440

New

$

York

Philadelphia
Cleveland

39, 935
25, 505, 595
27, 130
48, 205

171,570
31, 745

Richmond

Atlanta
Chicago
St. Louis
Minneapolis
Kansas City

Dallas
San Francisco
Treasury
TOTALS

1, 854, 510
32, 125

21, 365
41, 645
21, 320
932, 080
745, 730
$29, 472, 955

$

39, 935
7, 594, 905
27, 130
48, 205
54, 170
31, 745
490, 910
14, 675

11,365
41, 645
21, 320

78, 345
745, 730
$9, 200, 080

~Te

Competitive
Noncompetitive

Institutions
TOTALS
An

thousand
new

cash.

28, 855
24, 031, 730

$

$71, 465 thousand of 13-week bills and an additional $492, 435
of 26-week bills will be issued to foreign official institutions for

additional

~

~

I
A

CONTACT:

B,E.',

~

Removal Notice
The item identified below has been removed in accordance with FRASER's policy on handling
sensitive information in digitization projects due to copyright protections.

Citation Information
Document Type: Transcript

Number of Pages Removed: 7

Author(s):
Title:

ABC "Good Morning America" Interview with Nicholas Brady

Date:

1990-09-10

Journal:

Volume:
Page(s):
URL:

Federal Reserve Bank of St. Louis

https://fraser.stlouisfed.org

E'

j

o

p

e 7I'easIIry

FOR RELEASE AT

September

4:00 P. MD

11, 1990

/

~ WCIshlnoton,

CONTACT:

'p'. C. '0

Telephone 566-2041

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
tenders for two series of Treasury bills totaling approximately
$18, 400 million, to be issued September 20, 1990. This offering
will result in a paydown for the Treasury of about $18, 425
million,
as the maturing bills total $36, 828 million (including the 111-day
cash management bills issued June 1, 1990, in the amount of $6, 008
million, the 44-day cash management bills issued August 7, 1990,
in the amount of $4, 030 million, and the 36-day cash
bills issued August 15, 1990, in the amount of $10, 088management
million).
Tenders will be received at Federal Reserve Banks and Branches
and at the Bureau of the Public Debt, Washington,
D. C. 202391500, prior to 1:00 p. m. , Eastern Daylight Saving time, Monday,
September 17, 1990. The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
December 21, 1989, and to mature December 20, 1990 (CUSIP No.
912794 UT 9), currently outstanding in the amount of $18, 461
million, the additional and original bills to be freely
interchangeable.

182-day bills for approximately $9, 200 million, to be dated
20, 1990, and to mature March 21, 1991 (CUSIP No. 912794

September
WA 8) .

tive

The bills will be issued on a discount basis under competiand noncompetitive
bidding, and at maturity their par amount

will be payable without interest.
Both series of bills will be
issued entirely in book-entry form in a minimum amount of $10, 000
and in any higher $5, 000 multiple,
on the records either of the
Federal Reserve Banks and Branches, or of the Department of the
Treasury.
The bills will be issued for cash and in exchange for
Treasury bills maturing September 20, 1990. Tenders from Federal
Reserve Banks for their own account and as agents for foreign
and international
monetary authorities will be accepted at the
weighted average bank discount rates of accepted competitive
tenders. Additional amounts of the bills may be issued to Federal Reserve Banks, as agents for foreign and international
to the extent that the aggregate amount
monetary authorities,
of tenders for such accounts exceeds the aggregate amount of
Federal Reserve Banks currently
maturing bills held by them.
hold $3, 444 million as agents for foreign and international
and $4, 520 million for their own account.
monetary authorities,
These amounts represent the combined holdings of such accounts
for the five issues of maturing bills. Tenders for bills to be
maintained on the book-entry records of the Department of the
Treasury should be submitted on Form PD 5176-1 (for 13-week
6-2 (for 26-week

series).

osu~
4:00 P. M.
11, 1990

FOR RELEASE AT

September

C

~

WoshinIf on,
CONTACT:

Cl'. C. '

~

TelePhone 566-204$

Office of Financing
202/376-4350

TREASURY'S WEEKLY BILL OFFERING

The Department of the Treasury, by this public notice, invites
tenders for two series of Treasury bills totaling approximately
$18, 400 million, to be issued September 20, 1990. This offering
will result in a paydown for the Treasury of about $18, 425
million,
as the maturing bills total $36, 828 million (including the 111-day
cash management bills issued June 1, 1990, in the amount of $6, 008
million, the 44-day cash management bills issued August 7, 1990,
in the amount of $4, 030 million, and the 36-day cash
bills issued August 15, 1990, in the amount of $10, 088management
million).
Tenders will be received at Federal Reserve Banks and Branches
and at the Bureau of the Public Debt, Washington,
D. CD 202391500, prior to 1:00 p. m. , Eastern Daylight Saving time, Monday,
September 17, 1990. The two series offered are as follows:
91-day bills (to maturity date) for approximately $9, 200
million, representing an additional amount of bills dated
December 21, 1989, and to mature December 20, 1990 (CUSIP No.
912794 UT 9), currently outstanding in the amount of $18, 461
million, the additional and original bills to be freely
interchangeable.

182-day bills for approximately $9, 200 million, to be dated
20, 1990, and to mature March 21, 1991 (CUSIP No. 912794

September
WA 8) .

tive

The bills will be issued on a discount basis under competiand noncompetitive
bidding, and at maturity their par amount

will be payable without interest.
Both series of bills will be
issued entirely in book-entry form in a minimum amount of $10, 000
and in any higher $5, 000 multiple,
on the records either of the
Federal Reserve Banks and Branches, or of the Department of the
Treasury.
The bills will be issued for cash and in exchange for
Treasury bills maturing September 20, 1990. Tenders from Federal
Reserve Banks for their own account and as agents for foreign
and international
monetary authorities will be accepted at the
weighted average bank discount rates of accepted competitive
tenders. Additional amounts of the bills may be issued to Federal Reserve Banks, as agents for foreign and international
to the extent that the aggregate amount
monetary authorities,
of tenders for such accounts exceeds the aggregate amount of
Federal Reserve Banks currently
maturing bills held by them.
hold $3, 444 million as agents for foreign and international
and $4, 520 million for their own account.
monetary authorities,
These amounts represent the combined holdings of such accounts
for the five issues of maturing bills. Tenders for bills to be
maintained on the book-entry records of the Department of the
Treasury should be submitted on Form PD 5176-1 (for 13-week
-2 (for 26-week series).

TREASURY'S

13-, 26-,

AND

52-WEEK BILL OFFERINGS,

Page

2

Each tender must state the par amount of bills bid for,
which must be a minimum of $10, 000. Tenders over $10, 000 must
be in multiples of $5, 000. Competitive tenders must also show
the yield desired, expressed on a bank discount rate basis with
A single
two decimals, e. g. , 7. 15%. Fractions may not be use