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a national emergency. It does not have to be an extraordinary situation, or have a source outside of the United States.

Mr. SANTOS. I am pleased to hear that, but I am not sure it is clear from the face of this bill. As I read this bill, it requires that a national emergency be declared, and the provisions under titles 2, 3 and 4 would apply with the exception of the concurrent resolution.

On its face, it would appear to require that the procedures described in this would be followed, and that the source of the emergency must be outside the United States. If this is not the case, then there is no problem.

Mr. WHALEN. I would want the staff to get together and make certain that what we say is true.

Mr. SANTOS. In many instances, Mr. Whalen, we have been pleased to hear from the staff that what appeared to be the case, was not the

case.

Mr. WHALEN. However, the Supreme Court may take a different view.

Mr. SANTOS. What we are concerned with is what 5 years hence, or 10 years hence, when we have gone on to other things, someone reading this act may read it somewhat differently than we do today. Mr. MAJAK. We have not yet conferred with the drafter of the bill. Mr. SANTOS. We will be interested in what the legislative history will say.

Let me just make another few comments on this bill. It was noted that there are certain procedures constraints on national emergency powers when they are coupled with armed hostilities. In other words, certain time limits must be placed on the use of national emergency powers in the use of armed forces.

The way the section 203, which contains those procedural constraints, reads, it is not at all clear that the armed hostilities have to involve the same situation with respect to which the national emergency has been declared, which raises the specter of national emergency powers being terminated automatically by the ending of the use of armed forces, and having nothing to do with the particular national emergency.

I don't know if that is the intention, but it might be read that way. I might add also that we have not had a chance to look at section 202. I would assume that we would all feel that this is crucial, and we would want to look at that very carefully.

Also, the congressional veto of the issuance of regulations, I feel confident in saying that it is certainly inconsistent with the recent Attorney General opinion on the use of congressional vetoes in the reorganization context.

It is certainly clear from that opinion that this ongoing congressional review after the fact in the issuance of regulations, especially in an area involving the foreign affairs area, would probably be regarded as unconstitutional.

I believe that this is all I have to say about this particular bill, except that we have not had a chance to go through it in detail.

Mr. CAVANAUGH. You don't expect to be forthcoming with any more details, or a fairly more detailed position by tomorrow?

Mr. SANTOS. We can make every effort to meet within the agencies and have more detailed comments. Again, they would not purport to

be an administration position, but would purport to be an interagency-the product of an interagency discussion.

Mr. CAVANAUGH. We would be very sympathetic to that. We are aware of the constraints of time you are operating under. Any expansion of your views that you can provide us by tomorrow will be appreciated.

Mr. SANTOS. I believe that there is one further point to be made with respect to section 101 (b) (2). I guess, actually, it cannot be answered until we have an interagency meeting. I think that you raised this issue.

Mr. CAVANAUGH. I want to go back just to clarify the distinction in my own mind of your earlier discussion. I am not sure that we understand.

Mr. SANTOS. Mr. Cavanaugh, I have just noticed one further comment on section 205. Again we have the problem that did appear in section 205 before, which is at the bottom of page 9. It appears that authorities which are being exercised and actions which are proposed to be exercised are distinguished. With respect to the latter actions that are opposed to be exercised, it appears that the President is required to submit a report before he can actually take this action. I don't know whether that is the intention.

Mr. MAJAK. This was brought to your attention. It envisions consultation. However, we can look at that wording again.

Mr. CAVANAUGH. Between 203 and 204, you seem to indicate that it would be your understanding that in 204 (a) there would be some restrictions to foreign interest because the actions to be taken would only be taken pursuant to a purpose relevant to 203.

Mr. SANTOS. I think that this is substantially correct. My recollection of the earlier draft is

Mr. CAVANAUGH. If I could stop you there, and perhaps have the staff address that because I would not agree with that. My understanding would be, once the authority is justified under 203, it gives rise to the powers of 204 which are unlimited, at least in 204 (a).

Mr. MAJAK. It would be our judgment that while the fact of the source of the threat, and therefore the triggering authority, is strictly foreign, certainly in terms of past usages, this would not preclude the purely domestic remedies.

However, we would be willing to admit that to distinguish between a domestic remedy and a foreign remedy is difficult. There might be cases where a combination of those two could be appropriate.

Mr. MOHRMAN. I might point out that the authorities can only be used to deal with the threat. The declaration of a national emergency does not give the President the right to do whatever he wants. He can only use the authorities to the extent necessary to deal with that threat.

So there would have to be some relationship between the circumstances and the authorities which are exercised.

Mr. CAVANAUGH. My understanding is that we probably should reinsert "foreign country" in the national restrictions in 204 (a). Mr. SANTOS. Section 204 (a) (ii), after banking. That is the suggestion we had.

Mr. CAVANAUGH. Then let the administration react to that further. I don't have any further questions.

Mr. WHALEN. I don't have any further questions either.

Mr. CAVANAUGH. I also have not had an opportunity to read the findings.

Mr. MAJAK. I don't have any particular comments to make other than to say that, in drafting these purposes and findings, we simply attempted to capture the broad purposes of this kind of legislation, to make it consistent with the purposes and findings of the Export Administration Act with which it is frequently used in tandem, and to transfer from the earlier staff draft some of the policy language out of the basic body of the act, and place it into the statement of purposes. I think it reflects rather closely in many cases the actual terms of this new draft.

Mr. WHALEN. I, like Mr. Cavanaugh, have not had a chance to look at this. The ink is still wet on it. Perhaps you and Tom might want to discuss it further.

Mr. MAJAK. Anytime.

Mr. CAVANAUGH. Then we are adjourned.

[Whereupon, at 3:40 p.m., the subcommittee adjourned, subject to the call of the Chair.]

EMERGENCY CONTROLS ON INTERNATIONAL

ECONOMIC TRANSACTIONS

Markup of Trading With the Enemy Act Reform Legislation

THURSDAY, JUNE 9, 1977

COMMITTEE ON INTERNATIONAL RELATIONS,

SUBCOMMITTEE ON INTERNATIONAL

ECONOMIC POLICY AND TRADE,
Washington, D.C.

The subcommittee met in open markup session at 2:25 p.m. in room 2255, Rayburn House Office Building, Hon. Jonathan B. Bingham (chairman of the subcommittee) presiding.

Mr. BINGHAM. We will be in order. We will continue consideration of the proposed legislation dealing with the Trading With the Enemy Act. I would like to call first the executive branch to give us any further comments on the draft legislation before us.

STATEMENT OF LEONARD E. SANTOS, ATTORNEY ADVISER, OFFICE OF THE GENERAL COUNSEL, DEPARTMENT OF THE TREASURY

Mr. SANTOS. Thank you, Mr. Chairman.

These comments are of a general nature. They do not address specifically some of the revisions. We will be happy to do that, following these comments.

We had, after yesterday's session, a discussion of the new draft. I believe there was a unanimity of views on the subject that really this draft and the one that we received the first time yesterday raised many new issues that were not discussed at the time of the hearings, certainly not contemplated in our draft of the bill, and I think that we are troubled by not so much the subject of these new issues, but we do not know what the administration's position would be on some of them, but we are troubled, really, with the speed that they are being considered here for presentation to the full committee.

We realize you are under a time guideline of sorts. We are not sure that that deadline requires that you present a bill in such a form.

We think that, among the new issues that have been raised by your proposed draft are the issues of secondary boycotts, unilateral trade embargoes, conditional grandfathering, the so-called first amendment exceptions, the distinction between foreign and domestic powers, seizure of documents, legislative veto of regulations, to name the primary ones.

We have worked diligently on a bill that we think responds, at least, in part, to the issues that were raised in the hearings and

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