The Trading With the Enemy Act is the law that allows the United States government (specifically the President) to declare embargoes on unfriendly countries. While this act has been applied to many nations in its long history, the most notorious instance would have to be Cuba. Not only has the US government used this piece of legislation to prevent Americans and American companies from trading with Cuba, but it also has attempted on several occasions to apply these rules to foreign nationals and companies based outside of the United States. Several Canadian executives whose companies do business in Cuba are banned from entering the US, and one, James Sabzali (a Canadian citizen), has been tried, convicted, and will soon be sentenced in the US, despite the protest of the Canadian government and the international community, for selling water-purification chemicals to Cuban hospitals.
TRADING WITH THE ENEMY ACT ("TWEA")
UNITED STATES CODE
TITLE 50. WAR AND NATIONAL DEFENSE
TITLE 50 APPENDIX -- WAR AND NATIONAL DEFENSE
TRADING WITH THE ENEMY ACT OF 1917
ACT OCT. 6, 1917, CH 106, 40 STAT. 411
Sec. 5. Suspension of provisions relating to ally of enemy; regulation of transactions in foreign
exchange of gold or silver, property transfers, vested interests, enforcement and penalties
(b) (1) During the time of war, the President may, through any agency that he may designate, and
under such rules and regulations as he may prescribe, by means of instructions, licenses, or
otherwise--
(A) investigate, regulate, or prohibit, any transactions in foreign exchange, transfers of credit
or payments between, by, through, or to any banking institution, and the importing, exporting,
hoarding, melting, or earmarking of gold or silver coin or bullion, currency or securities, and
(B) investigate, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition
holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of,
or dealing in, or exercising any right, power, or privilege with respect to, or transactions
involving, any property in which any foreign country or a national thereof has any interest,
by any person, or with respect to any property, subject to the jurisdiction of the United States;
and any property or interest of any foreign country or national thereof shall vest, when, as,
and upon the terms, directed by the President, in such agency or person as may be designated
from time to time by the President, and upon such terms and conditions as the President may
prescribe such interest or property shall be held, used, administered, liquidated, sold, or
otherwise dealt with in the interest of and for the benefit of the United States, and such
designated agency or person may perform any and all acts incident to the accomplishment or
furtherance of these purposes; and the President shall, in the manner hereinabove provided,
require any person to keep a full record of, and to furnish under oath, in the form of reports
or otherwise, complete information relative to any act or transaction referred to in this
subdivision either before, during, or after the completion thereof, or relative to any interest
in foreign property, or relative to any property in which any foreign country or any national
thereof has or has had any interest, or as may be otherwise necessary to enforce the provisions
of this subdivision, and in any case in which a report could be required, the President may, in
the manner hereinabove provided, require the production, or if necessary to the national
security or defense, the seizure, of any books of account, records, contracts, letters,
memoranda, or other papers, in the custody or control of such person.
(2) Any payment, conveyance, transfer, assignment, or delivery of property or interest therein, made
to or for the account of the United States, or as otherwise directed, pursuant to this subdivision or any rule, regulation, instruction, or direction issued hereunder shall to the extent thereof be a full acquittance and discharge for all purposes of the obligation of the person making the same; and no
person shall be held liable in any court for or in respect to anything done or omitted in good faith in
connection with the administration of, or in pursuance of and in reliance on, this subdivision, or any
rule, regulation, instruction, or direction issued hereunder.
(3) As used in this subdivision the term "United States" means the United States and any place subject
to the jurisdiction thereof, [including the
Philippine Islands, and the several courts of first instance
of the
Commonwealth of the Philippine Islands shall have jurisdiction in all cases, civil or criminal,
arising under this subdivision in the Philippine Islands and concurrent jurisdiction with the district
courts of the United States of all cases, civil or criminal, arising upon the
high seas]: Provided,
however, That the foregoing shall not be construed as a limitation upon the power of the President,
which is hereby conferred, to prescribe from time to time, definitions, not inconsistent with the
purposes of this subdivision, for any or all of the terms used in this subdivision. As used in this
section the term "
person" means an individual, partnership, association, or corporation.
(4) The authority granted to the President by this section does not include the authority to regulate
or prohibit, directly or indirectly, the importation from any country, or the exportation to any country,
whether commercial or otherwise, regardless of format or medium of transmission, of any information
or informational materials, including but not limited to, publications, films, posters, phonograph
records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMs, artworks, and news
wire feeds. The exports exempted from regulation or prohibition by this paragraph do not include
those which are otherwise controlled for export under section 5 of the Export Administration Act of
1979 [50 USCS Appx. @ 2404], or under section 6 of that Act [50 USCS Appx. @ 2405] to the
extent that such controls promote the nonproliferation or antiterrorism policies of the United States,
or with respect to which acts are prohibited by chapter 37 of title 18, United States Code [18
USCS @@ 791 et seq.].
Sec. 16. Offenses; punishment; forfeitures of property
(a) Whoever shall willfully violate any of the provisions of this Act or of any license, rule, or
regulation issued thereunder, and whoever shall willfully violate, neglect, or refuse to comply with
any order of the President issued in compliance with the provisions of the Act shall, upon conviction,
be fined not more than $ 1,000,000, or if a natural person, be fined not more than $ 100,000, or
imprisoned for not more than ten years or both; and the officer, director, or agent of any corporation
who knowingly participates in such violation shall, upon conviction, be fined not more than $ 100,000
or imprisoned for not more than ten years or both.
(b)(1) A civil penalty of not to exceed $ 50,000 may be imposed by the Secretary of the Treasury on
any person who violates any license, order, rule, or regulation issued in compliance with the
provisions of this Act.
(2) Any property, funds, securities, papers, or other articles or documents, or any vessel, together
with its tackle, apparel, furniture, and equipment, that is the subject of a violation under paragraph
(1) shall, at the direction of the Secretary of the Treasury, be forfeited to the United States Government.
(3) The penalties provided under this subsection may be imposed only on the record after opportunity
for an agency hearing in accordance with sections 554 through 557 of title 5, United States Code,
with the right to prehearing discovery.
(4) Judicial review of any penalty imposed under this subsection may be had to the extent provided
in section 702 of title 5, United States Code.
(c) Upon conviction, any property, funds, securities, papers, or other articles or documents, or any
vessel, together with tackle, apparel, furniture, and equipment, concerned in any violation of
subsection (a) may be forfeited to the United States.
The TWEA has been modified and extended over the years by many other acts, including the Foreign Assistance Act of 1961, the Cuban Democracy Act, and The Helms-Burton Act, etc.