CUSTOMS DENIAL OF DAN HANDELMAN'S FIRST PETITION (Dec. 1998)

Dear Friends:

This is the letter from Customs which I received, informing me that they have denied my petition for the return of my items including my videotapes and film. I want to thank all the people who called in, though it doesn't seem to have swayed them much. I also want to make it clear that I don't believe our phone calls had anything to do with the pre-penalty notice from OFAC, which was dated the day BEFORE the call-in day of December 4.

You will notice in this new letter the strangely construed logic that I exported blank videotape to Iraq and imported it back into the U.S.; and that somehow, "naturally," my act of videotpaing is a service of Iraqi origin.

I'm working on a legalese reply, but for now all I can do is laugh.

By the way, the following, which look like typos, are from the original letter:

1) Paragraph 3: "postage stamps you claim are Iraqi origin" should probably read "of Iraqi origin"
2) Paragraph 4: "Office of Foreign Assets Controls" should read "Office of Foreign Assets Control"
3) Paragraph 5: "_not_" is bold and underlined in the original document. 4) Throughout the document, where punctuation falls outside quotation marks, is in the original.
5) They refer to my items as "merchandise" (ooh, I hate that). [Paragraph 2 and 3rd paragraph from the end]

I'll let you know if you can do anything else specifically around the seizure issue.

--dan

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Department of the Treasury
U.S. Customs Service
Detroit , Michigan

December 15, 1998

Dear Mr. Handelman:

We reviewed your petition dated January 9, 1998 in which you seek relief from forfeiture of Iraqi currency, post cards, video and audio tapes, water bottle label, video cassettes, photographic film, assorted papers and Iraqi stamps. These items were seized under authority of 19 USC 1595a(c)(2)(B) for violation of 31 CFR Part 575.204, which prohibits the importation of goods or services of Iraqi origin. At the time of seizure, you were returning from an unlicensed trip to Iraq in violation of 31 CFR 575.207.

We referred your petition to the Office of Foreign Assets Control (OFAC) for review and recommendation. They have recommended that the merchandise be forfeited to the United States Government in accordance with our usual Customs procedures. We concur with the OFAC recommendation.

You say you are a member of Voices in the Wilderness and the reason for your trip was to deliver medicines to children's hospitals because you felt a moral obligation to help the Iraqi people. You feel all the seized items are exempt from seizure under the "Free Trade in Ideas Act" due to their informational nature. In addition you state that the film, video tapes, and papers were purchased in the U.S. and therefore are not goods of Iraqi origin. The postage stamps you claim are Iraqi origin but were purchased in Jordan. Therefore, since they were purchased in Jordan, you contend that the stamps should be returned to you.

The terms of the current ban on the importation of goods of Iraqi origin are detailed in the Iraqi Transactions Regulations, promulgated by the Treasury Department Office of Foreign Assets Controls (OFAC), and are located in 31 CFR Part 575. These regulations were enacted pursuant to Executive Orders 12722 and 12724. The executive Orders and subsequent OFAC regulations are authorized by the International Emergency Economic Powers Act (IEEPA) and the United Nations Participation Act (22 USC 287c).

Based upon the statutory authority for the Iraqi embargo cited above, your reliance upon the Free Trade in Ideas Act, 103 P.L. 236, to shelter the seized items from forfeiture, is misplaced. The statutory basis for the subject OFAC Iraqi embargo regulations, the U.N. Participation Act, was _not_ amended by the Free Trade in Ideas Act, and does not contain an "informational materials" exception. Consequently, the Free Trade in Ideas Act has no application to the current seizure.

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President Bush clearly indicated his intention to act in reliance on the U.N. resolution and not to include an informational materials exception when he issued EO 12724. The OFAC embargo regulations are specifically intended to implement that executive order. Based on 22 USC 287c, the President has the authority to issue such an order, including the ban on importation of "informational materials". It appears that an informational materials exception was not intended to be incorporated into the Iraqi embargo, nor is such an exception required by the Free Trade in Ideas Act.

In addition to your claim to an exception for "informational materials", you raise additional arguments from relief from forfeiture on the grounds that none of the seized property is "goods or services of Iraqi origin".

The phrase "goods or services of Iraqi origin" is defined in 31 CFR 575.311 of the OFAC regulations as:

(a) Goods produced, manufactured, grown, or processed within Iraq;
(b) Goods which have entered into Iraqi commerce;
(c) Services performed in Iraq.

All of the seized merchandise is in violation of the sanctions. The videotapes and film were purchased in the U.S. and taken by you to Iraq. This violated CFR 575.205, which prohibits the exportation of goods to Iraq. This prohibition also includes exporting goods through a third country. Pursuant to 22 USC 401(a), goods which are exported or shipped from the United States in violation of law are subject to forfeiture.

Further, 31 CFR 575.204 prohibits the importation of both goods and services of Iraqi origin. Services of Iraqi origin are defined in 31 CFR 575.311(c) as services performed in Iraq. Naturally, the prohibition on importation of services performed in Iraq applies to the product of that service, i.e., the photographic and video graphic services you performed while in Iraq. Hence, these articles are subject to seizure and forfeiture.

Regardless of the fact that other videotapes were given to you by others, those videotapes entered the Iraqi commerce. As noted above, there is no exception for these articles as informational materials and importation is prohibited by 31 CFR 575.204. Therefore, the subsequent attempted importation of these tapes into the U.S. subjected these items to seizure and forfeiture.

The remainder of the items under seizure are also considered of Iraqi origin. Some of these items are goods produced, manufactured, grown or processed in Iraq, and others entered the commerce of Iraq. Contrary to your belief, acquisitions of Iraqi origin from third countries

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is prohibited by 31 CFR 575.410. Therefore, even those Iraqi origin items acquired outside Iraq are subject to forfeiture.

In conclusion, the seized merchandise is properly classified as "goods or services of Iraqi origin". The attempted importation of these items subjected them to seizure and forfeiture pursuant to the Iraqi embargo regulations. Accordingly, your petition for relief from forfeiture is denied.

Pursuant to part 171.33 of the Customs Regulations, you have the right to file a supplemental petition within thirty days from the date of this letter. Supplemental petitions must set forth new facts or evidence which justify reconsideration of our decision.

In the event you take no action within the specified time, the Customs Service will forfeit the property by posting a notice of seizure and intent to forfeit in the Customshouse lobby for three successive weeks beginning on or about January 18, 1999. Under the authority of 19 USC 1608, if forfeiture proceedings are instituted, you have the right to seek judicial condemnation by posting a costs bond within twenty days from the date of first publication in the sum of $5,000.00 or 10% of the value of the property, whichever is lower, but not less than $250.00. Upon the posting of such bond, we will refer the matter to the United States Attorney for institution of Judicial proceedings in Federal Court to forfeit the claimed property. If you wish to claim the property but cannot afford to post the bond, you should contact the Fines, Penalties and Forfeitures Officer of Customs prior to expiration of the twenty day period to obtain a waiver of the bond requirement. You must fully disclose your finances in a signed statement. Upon satisfactory proof of your financial inability to pay the bond, it will be waived.

Sincerely,

Darrell E Woodard
FP&F Officer Back to Voices in the Wilderness/Portland home page