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Case Studies in Sanctions and Terrorism: Libya

Case Studies in Sanctions and Terrorism

<< Case Studies Index

Case 78-8
United States v. Libya (1978-: Gadhafi, Terrorism)

Case 92-12
United Nations v. Libya (1992-99: Pan Am 103)

Chronology of Key Events

1978	US bans military equipment sales to Libya in retaliation for Libyan support of terrorist groups. (New York Times, 21 January 1982, A1)
March 2, 1979	Deputy Assistant Secretary of State Morris Draper informs Congress that State Department, having received assurances that planes would be used only for national airline, has approved sale of three Boeing 747s, two 727s to Libya. (New York Times, 3 March 1979, A5)
September 29, 1979	Revised Export Administration Act, with amendment on terrorism sponsored by Representative Millicent Fenwick (R-NJ), is enacted. In accordance with amendment, State Department names Libya, Syria, Iraq, South Yemen as countries that, because of support for terrorism, may not receive certain US exports; exports of some other goods is made contingent upon congressional approval. (Flores 564, 570)
March 18, 1981	Secretary of State Alexander M. Haig Jr. claims that Libya is running training camps for terrorists. (Facts on File 1981,169)
May 6, 1981	US closes Libyan diplomatic mission in Washington, citing inter alia its "support for international terrorism." (New York Times, 7 May 1981, A1)
August 1981	US Navy F-14s are fired upon by, shoot down two Libyan fighter jets over Gulf of Sidra, which Libya claims as territorial waters. (New York Times, 20 August 1981, A1)
October 28, 1981	US imposes controls on exports of small aircraft, helicopters, aircraft parts, avionics to Libya to "limit Libyan capacity to support military adventures in neighboring countries." (General Accounting Office [GAO] 4)
November 1981	Exxon abandons its Libyan operations. (Wall Street Journal, 11 December 1981, 3)
December 6, 1981	US defense attaché is murdered in Paris; some observers suspect Libyan involvement. (Schott 16; Flores 582)
December 7, 1981	President Ronald Reagan claims US has evidence that Libyan leader Moammar Gadhafi has sent assassination teams to murder top US officials. (Washington Post, 11 December 1981, A28)
December 11, 1981	Reagan administration calls on 1,500 Americans residing in Libya to leave "as soon as possible," citing "the danger which the Libyan regime poses to American citizens." US passports are declared invalid for travel to Libya. (Washington Post, 11 December 1981, A1; Wall Street Journal, 11 December 1981, 3)
December 12, 1981	US oil firms agree to withdraw US personnel but announce they will be replaced with other foreign technicians. (Washington Post, 12 December 1981, A1)
January 21, 1982	Libya is reported to have rebuilt 400 heavy-duty trucks (sold to Libya by Oshkosh Trucks) to carry tanks and for other military purposes, despite written guarantees that the vehicles would be used solely for agricultural purposes. (New York Times, 21 January 1982, A1)
10 March 1982	Reagan embargoes crude oil imports from Libya, invoking section 232 of Trade Expansion Act of 1962, drawing on same national security finding made in case of Iranian oil in 1979. Presidential proclamation states: "Libyan policy and action supported by revenues from the sale of oil imported in to the United States are inimical to United States national security." In addition, US restricts exports of sophisticated oil, gas equipment, and technology but does not impose retroactive controls or embargo export of items that are available abroad. (Schott 18, 39; Wall Street Journal, 9 November 1982, 39)
November 1982	US State Department warns oil companies (notably Charter Oil, Coastal Corp.) against selling refined products derived from Libyan crude in US. Central Intelligence Agency (CIA) mounts opposition to Libyan occupation of Chad, assists Libyan exiles. CIA Director William J. Casey says these activities might lead to "ultimate" removal of Gadhafi. (Newsweek, 8 November 1982, 55; Wall Street Journal, 9 November 1982, 39)
December 1982	US bars Boeing sale of 12 commercial jets to Libyan Arab Airline for $600 million. (New York Times, 26 August 1983, A24)
August 1983	Libya sends troops into Chad in hope of overthrowing government of Hissen Habre. France, US support Habre. Reagan administration is divided over export license application for shipment of $40 million marine mooring system to Libya. (New York Times, 19 August 1983, A1, A6; 26 August 1983, A24)
March 18, 1984	In response to alleged Libyan bombing of Omburdman, Sudan, US sends two Awacs surveillance planes to Egypt. (Facts on File 1984, 197)
October 3, 1984	US charges Libya with complicity in laying of mines in Red Sea. (Facts on File 1984, 807)
November 3, 1985	Washington Post reports that President Reagan has authorized covert operation to undermine Gadhafi regime, based on June 1984 CIA assessment that "no course of action short of stimulating Gadhafi's fall will bring significant and enduring change in Libyan policies." (Washington Post, 3 November 1985, A1)
November 15, 1985	US bars imports of refined petroleum products from Libya, which have increased following opening of Ras Lanuf petrochemical complex earlier this year. (GAO 1987, 18)
December 27, 1985	Coordinated terrorist attacks at Rome, Vienna airports kill 19 people, wound 110; US soon links Abu Nidal, head of a Palestinian faction, to murders, claims he has received "a considerable amount of assistance" from Gadhafi. White House and State Department officials call on other governments to exert economic pressure on Libya to halt its support of terrorism. (Washington Post, 31 December 1985, A1)
January 7, 1986	President Reagan invokes International Emergency Economic Powers Act to implement comprehensive trade, financial controls against Libya. Order bars most exports and imports of goods, technology, services (except for humanitarian purposes), all loans or credits to Libyan government, transactions "relating to travel by a United States citizen or permanent resident alien to Libya, or to activities by any such person within Libya." However, Treasury regulations permit reexport of US goods to Libya that are substantially transformed in a third country. Given unwillingness of Western allies to join in sanctions against Libya, Reagan sends personal letters to allied leaders asking them "not to undercut US sanctions against Libya by replacing American oil companies and workers being ordered out of that country." Administration officials admit that they did not consult with allies before taking action. (New York Times, 8 January 1986, A6; 9 January 1986, A1; 10 January 1986, A6; Wall Street Journal, 8 January 1986, 2; Washington Post, 8 January 1986, A1; 10 January 1986, A30; GAO 1987, 11)
January 8, 1986	President Reagan orders freeze of Libyan government assets in US banks, including hundreds of millions of dollars of deposits held in foreign branches of American banks, as well as real property, other investments. Action is taken to preclude Libyan withdrawals, deter Libya from collecting on performance bonds placed by US companies doing business with Libya, guard against Libyan expropriation of US assets. (New York Times, 9 January 1986, A1; Wall Street Journal, 9 January 1986, 25; New York Times, 11 January 1986, A4; Caras 675)
January 15, 1986	Deputy Secretary of State John C. Whitehead begins visit to nine NATO countries to seek their support for US sanctions against Libya. (Washington Post, 14 January 1986, A11)
February 7, 1986	US revises sanctions to allow oil companies to continue operations in Libya temporarily to avoid "abandonment of contracts or concessions [which] would result in a substantial economic windfall to Libya." Rule allows sale of Libyan crude at Libyan ports, but bars drilling for, extracting, distributing, or marketing Libyan oil. In addition, companies are expected to dispose of their Libyan holdings "as soon as practicable on fair and appropriate terms," but no deadline is set. (New York Times, 8 February 1986, 33; Washington Post, 25 March 1986, A1; New York Times, 26 March 1986, A1)
March 24-25, 1986	US Sixth Fleet challenges Gadhafi's claim to territorial waters in Gulf of Sidra, crosses his "Line of Death." Action provokes Libyan attack during which two Libyan patrol boats are sunk, onshore antiaircraft missile site is destroyed. (Washington Post, 15 April 1986, A1; New York Times, 15 April 1986, A1)
April 5, 1986	Terrorist bomb destroys West Berlin discotheque frequented by US servicemen, killing three persons, injuring over 150. US charges Libyan complicity on basis of intercepted Libyan diplomatic transmissions. Reagan states that "evidence is direct, it is precise, it is irrefutable," begins planning military retaliation. (Washington Post, 15 April 1986, A1; New York Times, 15 April 1986, A1)
April 14, 1986	In hopes of forestalling US military response to West Berlin bombing, EC countries agree to reduce size of Libyan embassies, restrict movements of Libyan diplomats in Europe. (New York Times, 15 April 1986, A12)
April 15, 1986	US bombers attack Gadhafi headquarters, military airfields, suspected terrorist training camps around Tripoli, Benghazi in retaliation for Libyan role in 5 April bombing, and to deter future terrorist acts against US installations. UK allows US to use British airfields for exercise, but France denies overflight rights for US planes. (Washington Post, 15 April 1986, A1, A23; New York Times, 15 April 1986, A1)
May 5, 1986	Leaders of seven major industrial countries at economic summit in Tokyo cite Libya for its support of international terrorism, list a broad range of measures from which each of them could choose to act against countries supporting international terrorism. List includes inter alia arms embargoes, limits on diplomatic missions, improved extradition procedures for accused terrorists, closer cooperation among law enforcement agencies. (Washington Post, 6 May 1986, A1, A14)
May 5, 1986	State Department officials announce that special exemptions for US oil companies in Libya will not be extended beyond 30 June. Companies note that US action will result in sale of their assets at "fire-sale" prices, but that such losses will be minor since Libyan operations are small share of their total business. (New York Times, 6 May 1986, A14)
May 13, 1986	Libyan Arab Foreign Bank files suit in London seeking payment of funds blocked by Bankers Trust London under US assets freeze. (Weisburg 1006-1011)
June 23, 1986	Treasury amends regulations on Libya to bar reexport of goods incorporating US products from third countries destined for Libyan petroleum industry. (GAO 1987, 12)
June 30, 1986	Treasury revokes special exemptions for US oil companies but authorizes them to enter into standstill agreements with Libyan authorities to maintain their ownership rights for three years while they continue to negotiate the sale of assets to Libya. In the meantime, the oil companies have no claim to current oil production, nor are they obligated to pay current operating expenses. Of more concern to the companies, they also have no claim under the agreements to future reserves and would be locked out if additional reserves are discovered in Libya while bilateral relations remain hostile. (GAO 1987, 16-17)
August 1986	OPEC officials report that France has begun boycotting imports of Libyan oil, refined products. In further attempt to destabilize Gadhafi, Reagan administration sponsors disinformation campaign on extent of Libyan opposition to Gadhafi regime. (Wall Street Journal, 6 August 1986, 20; Schumacher 335)
Fall 1987	On 2 September, High Court of Justice in London rules in favor of Libya, orders Bankers Trust London to transfer to Libyan Arab Foreign Bank $131 million, plus accrued interest, that has been blocked by US assets freeze. US Treasury authorizes payment on 9 October. (Weisburg 1011)
Late 1988	Reagan administration accuses Libya of producing chemical weapons at plant near Rabta, south of Tripoli. Although Libya claims that plant produces pharmaceuticals, production ceases for over a year. (New York Times, 8 March 1990, A17)
December 21, 1988	Pan Am Flight 103 explodes over Lockerbie, Scotland, killing 270 people. After investigation, US and UK officials charge Libya with masterminding the bombing. (US Department of State 1995, Background Notes-Libya) Gadhafi reportedly cuts back funding to numerous rebel movements, asks them to close their offices in Libya. In interview in magazine Al Mussawar, Gadhafi admits to having supported terrorists in past, but "when we discovered that these groups were causing more harm than benefit to the Arab cause, we halted our aid to them completely and withdrew our support." Action parallels drop in Libyan foreign reserves to under $3 billion in first quarter of 1989. (Washington Post, 5 September 1989, A15; New York Times, 26 October 1989, A8)
January 1989	Just before the 3-year standstill agreements are to expire, Reagan allows US oil companies to return to Libya via their European subsidiaries. Gadhafi, however, refuses to allow them to return, in effect continuing the standstill and leaving US investments in limbo. (Rose 134)
September 19, 1989	A French airliner, UTA Flight 772, explodes over Niger, killing all persons aboard. French investigators later uncover evidence implicating Libyan intelligence agents. (Rose 135)
March 1990	Within days of US intelligence reports that chemical weapons production has resumed at Rabta, Gadhafi blames West German agents for alleged fire at plant he claims has caused extensive damage. US intelligence agencies later conclude that alleged fire was elaborate hoax, that Rabta plant is intact, capable of resuming production. (New York Times, 16 March 1990, A3; Washington Post, 19 June 1990, A17)
April 1990	Gadhafi intervenes with Abu Nidal to obtain release of two French hostages, one Belgian; Gadhafi receives "personal thanks" of French President François Mitterrand. (Washington Post, 27 May 1990, A35)
June 1990	Palestinian terrorist, captured with several heavily armed comrades off coast of Israel, claims they were trained in Libya, transported in Libyan boats, accompanied by Libyan adviser. A few months later, Gadhafi expels radical Palestinian group responsible for attack. (Washington Post, 7 June 1990, A30; 5 November 1990, A19)
November 1991	US, UK, France issue joint declaration calling on Libya to surrender for trial those recently charged in the Pan Am and UTA bombings. (Rose 136)
December 2, 1991	The EC calls on Libya to comply with the joint demands and raises the possibility of sanctions if it does not. Libya reportedly begins to move its liquid assets out of Britain and France to Switzerland and Gulf states. (Rose 136)
December 4, 1991	Libya arrests two men suspected in the bombing of Pan Am Flight 103 but refuses to extradite them to the US or the UK. (International Institute for Strategic Studies, 240)
January 1992	In an effort to stave off a British-backed resolution in the United Nations Security Council imposing sanctions, Gadhafi offers to surrender the Pan Am suspects to an international tribunal. (Rose 136)
March 31, 1992	The Security Council rejects the Libyan offer as inadequate, imposes a total air and arms embargo (UN Security Council Resolution 748) in response to Libya's continuing refusal to extradite the suspects in the bombings. The resolution also restricts the number of diplomats Libya can maintain abroad. (Washington Post, 12 November 1993, A39)
May 14, 1992	During remarks at a Non-Aligned Movement meeting in Indonesia, Libyan Foreign Minister Ibrahim Mohammed Beshari claims that Libya will abandon terrorism. However, Libya continues to refuse to release two suspects in the Pan Am 103 bombing. (Financial Times, 15 May 1992, 6)
May 1993	Libya claims that UN travel sanctions have caused the death of over 800 people and cost the country $2.2 billion in lost exports. Gadhafi appeals to his North African neighbors to help broker a UN agreement and hints that Libya would try to open its borders to greater investment and tourism in an effort to end its international isolation. (Financial Times, 10 May 1993, 6)
November 11, 1993	Given Libya's continuing intransigence, the UN Security Council votes to ban the sale of petroleum equipment to Libya and to freeze non-petroleum-related Libyan government assets abroad. The sanctions fall short of a US effort to prohibit the export of Libyan crude, a move opposed by Germany and Italy. Russia reluctantly votes for the resolution while China, Pakistan, Morocco, and Djibouti abstain. The resolution states that sanctions will be lifted if Libya agrees to extradite to the UK two suspects in the Pan Am 103 bombing. Libya offers to send the two agents to stand trial in Switzerland, but both London and Washington refuse. (Washington Post, 12 November 1993, A39)
April 1995	In its annual terrorism report, the State Department charges Libya with continued support of international terrorists and involvement in overseas attacks against Libyan exiles. (US Department of State 1995, Background Notes-Libya)
September- October 1995	Libya begins expelling foreign workers, citing the economic hardship incurred as a result of the 1992 UN trade and travel sanctions, and requests permission from the UN to charter flights to repatriate migrant African workers in the country. Tripoli hopes that the expulsions will put pressure on the UN to relax its sanctions program. (Financial Times, 19 October 1995, 8)
December 11, 1995	The UK expels a Libyan diplomat from the special interests section of the Saudi embassy on charges of espionage. Libya retaliates by sending home a British diplomat from the interest section of the Italian embassy in Tripoli. (Financial Times, 12 December 1995, 7)