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(1) is increasing the number of illicit laboratories destroyed and is vigorously prosecuting and punishing the owners and operators of such laboratories;

(2) is increasing the number of arrests and successful prosecutions of violators, with particular emphasis on putting major traffickers out of business; and

(3) has made changes in Pakistani legal codes in order to enable Pakistani law enforcement officials to move more effectively against narcotics traffickers, such as new conspiracy laws and new asset seizure laws.

SEC. 4308. AFGHANISTAN AS A HEROIN SOURCE.

(a) FINDING.-The Congress finds that Afghanistan remains the source of most of the heroin exported from southwest Asia. (b) STATEMENT OF POLICY.-It is the sense of the Congress that(1) the United States Government should pursue efforts to press the Government of Afghanistan, and should work with the Mujahadeen

(A) to reduce production and trafficking in areas under their respective control, and

(B) to encourage drug eradication, interdiction, and crop substitution in Afghanistan; and

(2) an initiative should be developed which could be put in place as the Mujahadeen and successors to the present Kabul regime begin to exert more civil authority.

SEC. 4309. INVOLVEMENT OF THE GOVERNMENT OF LAOS IN ILLICIT DRUG PRODUCTION AND TRAFFICKING.

(a) PERIODIC REPORTS.-The President shall prepare and transmit to the Congress, in accordance with subsection (b), periodic reports containing the following determinations:

(1) Does the Government of Laos, as a matter of government policy, encourage or facilitate the production or distribution of illegal drugs?

(2) Does any senior official of the Government of Laos engage in, encourage, or facilitate the production or distribution of illegal drugs?

(3) Do other governments in the region assist the distribution of illegal drugs from Laos?

(b) TIME FOR SUBMISSION OF REPORTS.-The report described in subsection (a) shall be submitted as part of each report required by section 481(e) of the Foreign Assistance Act of 1961 and as part of each report required by section 2013 of the Anti-Drug Abuse Act of 1986.

(c) INFORMATION TO BE INCLUDED. (1) If an affirmative determination is made under paragraph (1) or (2) of subsection (a), the report shall describe the activities and identities of officials whose activities caused that determination to be made.

(2) If an affirmative determination is made under paragraph (3) of subsection (a), the report shall describe the activities of other

governments in the region which caused that determination to be made.

SEC. 4501.2 REPORTING ON TRANSFER OF UNITED STATES ASSETS.

(a) 15-DAY ADVANCE NOTIFICATION.-Any transfer by the United States Government to a foreign country for narcotics control purposes of any property seized by or otherwise forfeited to the United States Government in connection with narcotics-related activity shall be subject to the regular reprogramming procedures applicable under section 634A of the Foreign Assistance Act of 1961.

3

(b) ANNUAL REPORTS.-Section 489(b) of the Foreign Assistance Act of 1961 requires that all such transfers be reported annually to the Congress.

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SEC. 4702. RESTRICTIONS ON LAUNDERING OF UNITED STATES CURREN

CY.

(a) FINDINGS.-The Congress finds that international currency transactions, especially in United States currency, that involve the proceeds of narcotics trafficking fuel trade in narcotics in the United States and worldwide and consequently are a threat to the national security of the United States.

(b) PURPOSE.-The purpose of this section is to provide for international negotiations that would expand access to information on transactions involving large amounts of United States currency wherever those transactions occur worldwide.

(c) NEGOTIATIONS. (1) The Secretary of the Treasury (hereinafter in this section referred to as the "Secretary") shall enter into negotiations with the appropriate financial supervisory agencies and other officials of any foreign country the financial institutions of which do business in United States currency. Highest priority shall be attached to countries whose financial institutions the Secretary determines, in consultation with the Attorney General and the Director of National Drug Control Policy, may be engaging in currency transactions involving the proceeds of international narcotics trafficking, particularly United States currency derived from drug sales in the United States.

(2) The purposes of negotiations under this subsection are

(A) to reach one or more international agreements to ensure that foreign banks and other financial institutions maintain adequate records of large United States currency transactions, and

(B) to establish a mechanism whereby such records may be made available to United States law enforcement officials. In carrying out such negotiations, the Secretary should seek to enter into and further cooperative efforts, voluntary information

2 22 U.S.C. 2291-2.

3 Sec. 6(e)(1) of the International Narcotics Control Act of 1992 (Public Law 102-583; 106 Stat. 4933) struck out "Section 4601 of this title" and inserted in lieu thereof "Section 489(b) of the Foreign Assistance Act of 1961". Sec. 6(eX1) of that Act, furthermore, repealed section 4601 of this title.

+31 U.S.C. 5311 note.

exchanges, the use of letters rogatory, and mutual legal assistance treaties.

(d) REPORTS.-Not later than 1 year after the date of enactment of this Act, the Secretary shall submit an interim report to the Committee on Banking, Finance and Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate on progress in the negotiations under subsection (c). Not later than 2 years after such enactment, the Secretary shall submit a final report to such Committees and the President on the outcome of those negotiations and shall identify, in consultation with the Attorney General and the Director of National Drug Control Policy, countries

(1) with respect to which the Secretary determines there is evidence that the financial institutions in such countries are engaging in currency transactions involving the proceeds of international narcotics trafficking; and

(2) which have not reached agreement with United States authorities on a mechanism for exchanging adequate records on international currency transactions in connection with narcotics investigations and proceedings.

(e) AUTHORITY.-If after receiving the advice of the Secretary and in any case at the time of receipt of the Secretary's report, the Secretary determines that a foreign country

(1) has jurisdiction over financial institutions that are substantially engaging in currency transactions that effect the United States involving the proceeds of international narcotics trafficking;

(2) such country has not reached agreement on a mechanism for exchanging adequate records on international currency transactions in connection with narcotics investigations and proceedings; and

(3) such country is not negotiating in good faith to reach such an agreement,

the President shall impose appropriate penalties and sanctions, including temporarily or permanently

(1) prohibiting such persons, institutions or other entities in such countries from participating in any United States dollar clearing or wire transfer system; and

(2) prohibiting such persons, institutions or entities in such countries from maintaining an account with any bank or other financial institution chartered under the laws of the United States or any State.

Any penalties or sanctions so imposed may be delayed or waived upon certification of the President to the Congress that it is in the national interest to do so. Financial institutions in such countries that maintain adequate records shall be exempt from such penalties and sanctions.

(f) DEFINITIONS.-For the purposes of this section

(1) The term "United States currency" means Federal Reserve Notes and United States coins.

(2) The term "adequate records" means records of United States' currency transactions in excess of $10,000 including the identification of the person initiating the transaction, the per

son's business or occupation, and the account or accounts affected by the transaction, or other records of comparable effect. (g) SUNSET.-The authority given the President in subsection (e) shall expire on June 30, 1994.

SEC. 4804. CONSISTENCY WITH INTERNATIONAL OBLIGATIONS OF THE UNITED STATES.

(a) In prescribing regulations under subtitle D of title V of this Act, the head of the appropriate agency

(1) shall only establish requirements that are consistent with the international obligations of the United States, and

(2) shall take into consideration any applicable laws and regulations of foreign countries.

(b) Section 5152 shall not be construed as conferring extraterritorial application of the provisions of such section.

5 Subtitle D of title V of this Act was cited as the "Drug-Free Workplace Act of 1988". Sec. 5152 outlined "Drug-Free Workplace Requirements for Federal Contractors". See 102 Stat. 4304, 41 U.S.C. 701.

(6) International Narcotics Control Act of 1986

Title II of Public Law 99-570 [Anti-Drug Abuse Act of 1986, H.R. 5484], 100 Stat. 3207-60, approved October 27, 1986; amended by Public Law 100-690 (International Narcotics Control Act of 1988, H.R. 5210], 102 Stat. 4181, approved November 18, 1988; and Public Law 102-583 [International Narcotics Control Act of 1992; H.R. 6187], 106 Stat. 4914, approved November 2, 1992

NOTE. Sec. 6(e)(2) of the International Narcotics Control Act of 1992 (Public Law 102-583; 106 Stat. 4933) provided the following:

"(e) REPEAL OF OBSOLETE PROVISIONS.

"(2) 1986 DRUG ACT.-All sections of the International Narcotics Control Act of 1986 (which is title II of the AntiDrug Abuse Act of 1986) are repealed except for sections 2001, 2010, 2015, 2018, and 2029.".

AN ACT To strengthen Federal efforts to encourage foreign cooperation in eradicating illicit drug crops and in halting international drug traffic, to improve enforcement of Federal drug laws and enhance interdiction of illicit drug shipments, to provide strong Federal leadership in establishing effective drug abuse prevention and education programs, to expand Federal support for drug abuse treatment and rehabilitation efforts, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SEC. 1.1 SHORT TITLE.

This Act may be cited as the "Anti-Drug Abuse Act of 1986".

TITLE II-INTERNATIONAL NARCOTICS CONTROL

SECTION 2001.2 SHORT TITLE.

This title may be cited as the "International Narcotics Control Act of 1986".

SEC. 2010. ISSUANCE OF DIPLOMATIC PASSPORTS FOR DRUG ENFORCEMENT ADMINISTRATION AGENTS ABROAD.

The Congress commends the decision of the Secretary of State to issue diplomatic passports, rather than official passports, to officials and employees of the Drug Enforcement Administration who

121 U.S.C. 801 note.

2 22 U.S.C. 2151 note.

75-456 094-6

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