America Should Impose Stricter Aircraft Sanctions on Iran

With Iran continuing to be a state sponsor of terror and continuing the development of nuclear weapons, it is imperative that the United States impose stricter sanctions upon Iran in an effort to place more pressure on the Iranian regime. One underutilized method of achieving this is to prohibit airlines that fly to the U.S. from flying to Iran or code-sharing with airlines that fly to Iran. To prevent Iran from building up its own air fleet to circumvent these sanctions, it will also be necessary to prohibit the sale of aircraft and aircraft parts to Iran.

According to the World Travel and Tourism Council (WTTC), in 2015 travel and tourism generated 294,428 billion Iranian rials (about $9.13 billion) for Iran’s economy, which was 2.5 percent of Iran’s GDP. The total contribution of travel and tourism to GDP (including wider effects from investment, the supply chain and induced income impacts) generated 793,457 billion Iranian rials (about $24.49 billion) in 2015, which was 6.7 percent of Iran’s GDP. If international tourists need to book multiple flights to get to Iran, many of them will choose other destinations which are easier to access.

Commercial flights to Iran impact more than tourism revenue. They also make it easier to attract foreign direct investment. According to the United Nations Conference on Trade and Development (UNCTAD), in 2015 Iran received $2.05 billion in foreign direct investment inflows. Ease of travel makes it easier for potential investors to visit Iran and for Iranians to visit potential investors and establish business relationships. Making this travel more difficult will add another barrier to market entry and either reduce the level of foreign direct investment or reduce its rate of growth.

Commercial flights to Iran also ship a significant amount of cargo. According to the World Bank, in 2015 Iran received 107.185 million ton-kilometer of goods shipped via air cargo. Reducing the availability of shipping cargo by air would increase Iran’s dependency on shipping by sea.

Iran could reduce the impact of flight sanctions by building up its own aircraft fleet. To prevent that from occurring, it is also necessary to prevent the sale of aircraft and aircraft parts to Iran. The bulk of Iran’s air fleet consists of aging U.S.-made aircraft built prior to the revolution in 1979. In September 2016, the Office of Foreign Assets Control (OFAC) issued licenses authorizing Airbus to sell 17 aircraft to Iran Air, the airline owned by the Iranian government. In November 2016, Airbus received licenses from OFAC authorizing the sale of 106 additional aircraft to Iran Air. Airbus requires licenses from OFAC in order to sell aircraft to Iran since 10 percent of its parts are made in the U.S. OFAC also issued licenses authorizing Boeing to sell 80 aircraft to Iran Air. It is imperative that these licenses be revoked before either of these firms can make delivery of any of the aircraft to Iran. This is an action that can be taken by the Trump administration without the need for authorization from Congress.

The economic impact of selling aircraft to Iran Air is not the only issue. In a July 2016 hearing of the House Foreign Affairs Committee, Chairman Ed Royce discussed Iran's use of commercial aircraft in support of terrorism. He noted that in 2011, the Treasury Department stated that “Iran Air has shipped military-related equipment on behalf of the IRGC since 2006, and in 2008, Iran Air shipped aircraft-related raw materials to a Ministry of Defense-associated company, including titanium sheets, which have dual-use military applications and can be used in support of advanced weapons programs.” During that same hearing, Mark Dubowitz, Executive Director of the Foundation for Defense of Democracies, noted that such behavior continues and that in June 2016, “three Iran Air flights went from the IRGC’s resupply base in Iran to Damascus.”

In addition to OFAC withdrawing the licenses to sell aircraft to Iran, there are also actions that Congress can take. In February 2017, Congressman Pete Roskam, along with Leonard Lance, Lee Zeldin, and Doug Lamborn, introduced H.R. 808, the Iran Nonnuclear Sanctions Act of 2017. Sections 105, 106, and 107 of the bill deal specifically with sanctions related to aircraft.

Section 105 of the Act discusses sanctions against Mahan Air, an airline which is owned by the Iranian Revolutionary Guard Corps (IRGC). It calls for the imposition of sanctions against any person who provides goods, services, technology, or financial services to Mahan Air or any of its agents or affiliates, manages or is on the board of directors of or any of its agents or affiliates, or entities who own more than a 25 percent interest. The specific sanctions imposed include the blocking of property in the U.S. or in the possession or control of a United States person and the denial of visas to enter the U.S.

Section 106 of the Act discusses further measures regarding Mahan Air. It requires the Director of National Intelligence, in consultation with the Secretary of the Treasury, to submit to Congress a list of each entity that would be subject to the sanctions described in section 105 of the Act. Section 107 of the Act discusses requiring the President to submit to Congress a report that contains “a description of all efforts the Department of State has made to encourage other countries to prohibit the use of air space and airports by Iranian air carriers.”

Stronger aircraft sanctions will exert additional pressure upon Iran. Combined with other measures, these sanctions will hopefully damage Iran’s economy to the point where it will be less able to fund terrorist acts and fund the development of nuclear weapons capabilities than they are currently.

Zachary Leshin is a former congressional staffer who has worked extensively in Middle East policy.

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