The Iran Sanctions Act of 1996 authorized the President to sanction foreign firms that make investments of more than $20 million per year in Iran's energy sector, or that sell weapons of mass destruction ("WMD") technology or "destabilizing numbers and types" of advanced conventional weapons to Iran. CISADA changes the ISA to make clear that investment in energy pipelines is sanctionable activity. Activities related to refined petroleum were also made sanctionable. The proscribed activities include those involved with the production of refined petroleum products in Iran, or the exportation of refined petroleum products to Iran (or the facilitation thereof). The provisions apply to firms that sell, lease, or provide goods, services, technology, information, or support that assists Iran's refining capacity, or that supply Iran with refined petroleum products.
CISADA also expanded the menu of available sanctions from six to nine, and increased the number of sanctions that the President is required to impose from two to three. The original six sanctions, which remain in effect, are (1) denial of Export-Import Bank assistance; (2) denial of U.S. export authorizations; (3) denial of certain loans (over $10 million in 12 months) from U.S. financial institutions; (4) restrictions specific to sanctioned financial institutions; (5) a ban on U.S. Government procurement of goods and services from the sanctioned firm; and (6) import restrictions. The three additions made by CISADA are (1) the prohibition on access to foreign exchange transactions subject to U.S. jurisdiction; (2) the prohibition on transfers of credit or payments subject to U.S. jurisdiction; and (3) the prohibition on transactions with respect to property in which the sanctioned firm has an interest when subject to U.S. jurisdiction. Under the original ISA, the President was required to choose two of the original six sanctions; CISADA now requires the President to choose three from the expanded nine-item list. CISADA also adds new certifications for U.S. Government contracts.
CISADA requires sanctions for amounts exceeding $1 million in a single transaction, or $5 million in 12 months. Additionally, CISADA made some formerly discretionary Presidential actions mandatory. Previously, the ISA provided that the President "should initiate" an investigation upon receipt of credible information. But CISADA amended the ISA to provide that the President "shall initiate" an investigation unless the President certifies to Congress that the firm is "no longer engaging in," or has "taken significant verifiable steps toward stopping the activity." The President must also have "received reliable assurances" that the entity will not "knowingly engage" in sanctionable activity in the future (the "Special Rule"). CISADA also tightened the required certifications for Presidential waivers. Waivers are now required to be "necessary" to the U.S. national interest, where they were previously required to be only "important." Additionally, sanctions for entities under other governments with primary jurisdiction may be waived on a case-by-case basis for up to 12 months, where the President certifies that the government is closely cooperating with the United States regarding Iranian objectives and the waiver is "vital" to national security interests."
"Iran's recent invitation to Chinese oil companies and banks to invest $43 billion in Iran's oil industry"
:"In January, Iran and China signed a $1.76bn contract for the initial development of the North Azadegan oil field in western Iran."