DOS Letter on Iran Sanctions on Employment Visas

Mr. Richard Newcomb, Director
Office of Foreign Assets Controls
Department of Treasury
1500 Pennsylvania Ave, NW
Room 2233 Annex
Washington, D.C. 20220

Subject: Implications of Iran Sanctions for Employment Visas

Dear Mr. Newcomb:

I am writing to request your confirmation, on an expedited basis, of advice we have orally received from OFAC staff that is critical to the adjudication of visa applications by our consular officers overseas. Specifically, we require OFAC’s formal opinion as to whether an Iranian resident in Iran is violating or would violate the Iranian sanctions regime established under Executive Order 12959 (May 6, 1995) and subsequent authorities by engaging in employment in the United States. If the answer to this question is no, we also require OFAC’s formal views on whether the U.S. based employer of such an Iranian would be violating the Iran sanctions regime.

Executive Order 12959 on its face broadly prohibits the importation of Iranian origin services to the United States. Section 1(a) provides that "the importation into the United States, or the financing of such importation, of any goods or services of Iranian origin" is prohibited unless otherwise provided in regulations, orders, directives, or licenses. We note that this section does not explicitly state that the importation must be by a "United States person," and therefore leaves open the possibility that an Iranian resident in Iran could be considered to be importing Iranian-origin services by traveling to the United States to work. The Executive Order does, however, suggest that a United States person would be engaging in prohibited activity by arranging the Iranian’s employment and/or advancing funds for the Iranian’s travel to the United States to provide services. Section 1(d) of the Executive Order provides that "any transaction… by a United States person relating to goods or services of Iranian origin" is similarly prohibited. More clearly than section 1(a), this section focuses on the activities of U.S. persons. Unlike section 1(a), it does not as easily admit the possibility that it could apply to the activities of the Iranian in Iran seeking to enter the United States. These provisions also suggest the possibility that for a consular officer to approve the visa application for an Iranian resident in Iran coming to the U.S. to work, or for INS to approve an underlying visa petition filed by the prospective U.S. based employer, would be to grant legitimacy to a transaction related to services of Iranian origin prohibited under section 1(d) of the Executive Order.

We note, also, that 39 CFR 560.306 defines services of Iranian origin to exclude "services provided in the United States by an Iranian national resident in the United States." It is unclear to us how this definition affects the interpretation of the above sections of the Executive Order insofar as employment of Iranians resident in Iran but planning to relocate to the United States to provide services is concerned.

Under Section 212(a)(3)(A) of the Immigration & Nationality Act, 8 USC 1182(a)(3)(A), an alien who there is "reasonable ground to believe" is seeking to enter the United States "to engage solely, principally, or incidentally in… any …unlawful activity" is inadmissible to the United States and therefore ineligible for a visa. If an alien applying for a visa advised a consular officer that he or she was coming to the United States to engage in an unlawful activity, or the consular officer had reasonable ground to believe that this was the case, the visa would be denied. If the alien wished to engage in the United States in an activity for which an alien required a Treasury license, we would deny the visa unless the alien had the required license, on the ground that to engage in the activity without such license would be to engage in unlawful activity. On the other hand, if it would not be unlawful for the alien to engage in the proposed activity in the United States, the visa ordinarily would be issued.

There is another dimension to this issue because the question we are raising arises in connection with employment-based visa applications by Iranians resident in Iran for which the prospective U.S. employer has on file with the Immigration & Naturalization Service (INS) an approved visa petition. Only after the petition is approved can the potential employee apply for a visa. This raises the possibility that, even if the Iranian resident in Iran would not be engaged in unlawful activity by coming to the U.S. to work, the U.S. based employer’s act of employing the alien would be unlawful. If in fact the U.S. based employer is violating the Iran sanctions regime by bringing an Iranian resident in Iran to the United States to work, the Department will wish to discuss with INS whether our consular officers should defer action on the visa application and return the employment petition to INS for review and possible revocation. The question whether approval of the visa or petition would violate the Executive Order would be particularly relevant to resolution of this issue.

Finally, if neither the prospective Iranian employee nor the U.S. based employer would be violating the sanctions regime in the kind of arrangement in question, then there would be no basis for denying the visa or for returning the underlying petition to INS. If this is true, we should notify our posts that there is no reason for them to delay action on pending visa applications of this nature, and that there is no basis for denial of such applications under the Iran sanctions regime.

These issues have been under discussion among OFAC and the Department staff for the last eighteen months. We now understand that OFAC has concluded that an Iranian resident in Iran is not violating the sanctions regime by undertaking employment in the United States or by traveling to the United States to undertake such employment, but that the U.S. based employer is violating that regime by importing an Iranian-origin service. Assuming that this is OFAC’s official position, we will immediately commence discussions with the INS about the handling of petitions in these cases, but also advise our officers in the field that the sanctions regime is not a basis for visa denial assuming the underlying petition is valid. It is important that OFAC’s position on this issue be provided to us promptly in wiring, so that we can provide guidance to our consular officers abroad and, if necessary, work with the INS to develop an appropriate procedure for handling visa petitions filed by the U.S. based employers on behalf of Iranians in Iran.

Thank you for your assistance.

Sincerely

Donna J. Hamilton

Department of the Treasury
Washington, DC 20220

FAC No. IA-156368

July 29, 1997

Dear Ms. Hamilton:

This responds to your letter of June 30, 1997, requesting a formal opinion from this Office concerning interpretation of provisions in Executive Order No. 12959 of May 6, 1995 (the "Order"), that may pertain to the issuance of visas by consular officers of the State Department. Specifically, you have asked our opinion as to whether an Iranian who is resident in Iran is violating or would violate the Order and the Iranian Transactions Regulations, 31 CFR Part 560 (the "ITR"), by coming to the United States and engaging in employment here. If our answer to this question is no, you also request our opinion as to whether the U.S. based employer of such an Iranian would be violating the Order or the ITR.

For purposes of this analysis, we assume that the prospective employee is an Iranian national normally resident in Iran (the "Iranian national"), and that the prospective employer has issued a binding offer for the Iranian national to work in the United States. Under Section 1(a) of the Order and ITR Section 560.201, it is unlawful for a prospective U.S. employer to issue a binding offer of U.S. employment to an Iranian resident in Iran or to advance funds for him to enter for that purpose, as such actions would constitute an unlawful importation (or attempted importation) of Iranian-origin services into the United States. Similarly, under Section 1(d) of the Order and ITR Section 560.206, a U.S. person who causes or attempts to cause such employment to occur would be engaging in an unlawful dealing in services of Iranian origin. On the other hand, we do not view the Iranian national himself to be importing Iranian-origin services when he travels to the United States to work. Consequently, the Iranian national is not viewed as violating or attempting to violate the prohibition on importation of Iranian-origin services in Section 1(b) of the Order. Similarly, the prohibition in Section 1(d) of the Order on dealing in Iranian-origin services would not be violated by the Iranian national himself but only by the U.S. person seeking to arrange his employment.

This interpretation is not altered by ITR Section 560.306(b)(3). That section excludes from the definition of the term "goods or services of Iranian origin" any services provided in the United States by an Iranian national "resident in the United States." As a result of that definition, it is not a violation of the prohibition on importing Iranian-origin services to offer employment to an Iranian national once that person is resident in the United States. By "resident," we mean any Iranian national living in the United States, irrespective of whether the Iranian national is a U.S. permanent resident alien or a temporary resident. Further, if the U.S. employer of an Iranian national resident in the United States has not caused or arranged with others for that person to enter the United States from Iran to work, it is not a violation of the ITR for the U.S. employer to hire the Iranian national.

These interpretations derive from the policy basis for the prohibition on importation of services from Iran: denial of benefit to the Iranian economy from the U.S. market for services. The enforcement of the prohibition thus falls primarily on the U.S. person making use of Iranian-origin services, whether performed in Iran or brought to the United States from Iran.

You have indicated that under Section 212(a)(3)(A)(ii) of the Immigration and Nationality Act, 8 U.S.C. 1182(a)(3)(A)(ii) (the "INA"), an alien is inadmissible to the United States and therefore ineligible for a visa if there is "reasonable ground to believe" that the alien is seeking to enter the United States to "engage solely, principally, or incidentally in … any … unlawful activity." We agree that for a consular officer to approve a visa application for an Iranian national normally resident in Iran to come to the United States to work, or for the Immigration and Naturalization Service to approve an underlying visa petition filed by the prospective U.S. based employer, would further a transaction which the Order makes unlawful as to the U.S. employer. We do not, however, have expertise in interpretation of the INA, and therefore we do not express an opinion as to whether the unlawfulness of the U.S. employer’s conduct under the Order meets the condition of Section 212(a)(3)(A)(ii) that the alien be entering to "engage … in … unlawful activity." If Section 212(a)(3)(A)(ii) or other provisions of the INA authorize denial of the visa on these facts, we would agree that the consular officer’s failure to deny the visa would be inconsistent with Section 3 of the Order. That section directs that all agencies of the United States Government "take all appropriate measures within their authority to carry out the provisions of [the] order."

We hope this addresses your questions, and we would be glad to provide further assistance on this issue. Should you have any questions, please contact this office.

Sincerely,

R. Richard Newcomb
Director
Office of Foreign Assets Control