Prohibiting Certain Imports of Burmese Jadeite and Rubies

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Overview

Executive Order Objective

Executive Order 13651, signed by President Barack Obama on August 6, 2013, aims to prohibit the importation of jadeite and rubies mined in Burma (Myanmar) into the United States. This directive forms part of a broader U.S. strategy to exert economic pressure on the Burmese government, which, at the time, was criticized for its human rights abuses and lack of democratic reforms. The Executive Order is grounded in both domestic and international legal frameworks, including the International Emergency Economic Powers Act (IEEPA) and the Tom Lantos Block Burmese JADE (Junta's Anti-Democratic Efforts) Act of 2008.

Scope and Implementation

The order unequivocally bans imports originating from Burma, while allowing for certain exceptions related to pre-existing licenses and international obligations. Section 1 of the order states this prohibition clearly but allows for exceptions as specified by subsequent regulations, directives, or licenses. The regulation of jadeite and rubies under this order is facilitated by the Harmonized Tariff Schedule of the United States, which classifies these gemstones under specific headings for regulatory purposes.

Administrative Changes

In establishing this prohibition, the Executive Order amends Executive Order 13310 by revoking certain sections. Additionally, any activities designed to circumvent this new import ban are explicitly prohibited under Section 3, which aims to thwart any conspiracies or attempts to sidestep the order. Furthermore, the order assigns enforcement responsibilities to the Secretary of the Treasury, in conjunction with the Secretary of State, thereby underscoring the administrative structure for its implementation.

Exceptions and Waivers

The order has built-in exceptions to accommodate international agreements like the Vienna Convention on Diplomatic Relations. Section 6 further provides specific allowance for certain re-importations by individuals, addressing concerns about personal property taken abroad for personal use. Moreover, the President retains the authority to issue waivers when necessary to align with the national interests of the United States, as outlined in Section 8.

Timing and Effectiveness

The order took effect on August 7, 2013, with its enforcement resting on diplomatic and financial institutions already tasked with applying U.S. economic sanctions. The immediate economic and political implications of the order were intended to compel the Burmese government to prioritize human rights reforms as a condition for future economic engagement. However, the full impact of the order hinges on robust enforcement measures and diplomatic efforts to maintain its standing.

Legal and Policy Implications

Constitutional and Statutory Foundations

Executive Order 13651 is deeply grounded in statutory frameworks such as the IEEPA, which grants the President powers to regulate commerce after declaring a national emergency in response to any unusual and extraordinary threat. The National Emergencies Act is also pivotal in providing the legal basis for the actions taken by this order, particularly because it references ongoing emergencies declared in previous executive orders pertaining to Myanmar.

Regulatory Amendments

The Executive Order redefines regulatory and policy approaches to import prohibitions. It specifically revokes sections of Executive Order 13310, updating prior frameworks to align with contemporary foreign policy goals. The revocation of these sections is a legal maneuver to remove previous provisions that may have become obsolete or inadequate in addressing the current geopolitical scenario concerning Burma.

Policy Consistency and Enforcement

This Executive Order places significant emphasis on the role of the Department of the Treasury and the Secretary of State as primary agents of policy enforcement. The Treasury's Office of Foreign Assets Control (OFAC) becomes a pivotal body in ensuring compliance, given its pre-existing mandate to impose economic sanctions and monitor trade regulations.

Economic Mandates and Compliance

The JADE Act of 2008 is directly invoked, exemplifying Congress's role in shaping economic sanctions policy. The Order's firm posture on prohibiting imports serves not only to reinforce existing legislative mandates but also to expand the scope of economic measures against regimes perceived as oppressive. By doing so, it brings international trade practices into alignment with U.S. foreign policy objectives.

International Legal Considerations

The Executive Order recognizes the primacy of international conventions, promising compliance with diplomatic agreements like the Vienna Conventions. Such recognition is crucial to avoid diplomatic fallout and maintain the order within the boundaries of international law, ensuring it does not conflict with international juridical responsibilities or infringe on established consular privileges.

Who Benefits

Human Rights Advocates

Human rights organizations advocating for democratic reforms in Burma stand to benefit from the increased pressure this order places on the Burmese government. By targeting crucial sectors of the Burmese economy—specifically, the lucrative gemstone industry—the Executive Order aligns with the broader objectives of these organizations to highlight and combat human rights abuses.

U.S. Foreign Policy Interests

The Obama administration's emphasis on promoting democratic values and human rights benefits from the enhanced credibility this order provides. By taking tangible steps to curtail economic interactions with authoritarian states, the U.S. reinforces its stance as a global proponent of democracy, thus solidifying its geopolitical standing among allies and partners.

Gemstone Industries Outside Burma

Gemstone producers in countries not subject to these restrictions may experience indirect benefits. As the ban on Burmese jadeite and rubies constrains supply, alternative sources may find increased demand, potentially boosting their market positions and revenues. Jewelry retailers sourcing from these countries could align themselves as ethical alternatives in the global marketplace.

Supply Chain Transparency Advocates

Proponents of corporate social responsibility and transparent supply chains could see this order as a positive development. By linking trade with ethical considerations, the order boosts initiatives aimed at promoting responsible sourcing and corporate accountability, encouraging businesses to be conscious of the origins of their resources.

U.S. Firms Practicing Compliance

U.S. businesses that have established robust compliance practices to adhere to international trade laws might find themselves at an advantage. Given the stringent follow-through that this order demands, companies well-versed in compliance will be less disrupted by adjustments needed to conform to the new regulations governing Burmese imports.

Who Suffers

Burmese Gemstone Industry

The most direct adverse effect of the Executive Order falls upon Burma's gemstone industry. With the United States as a significant market for jadeite and rubies, the import ban disrupts trade and revenue for Burmese businesses reliant on export markets, potentially leading to economic instability within the affected sectors.

Local Burmese Communities

Communities in Burma where jadeite and ruby mining are primary economic activities may experience economic distress due to decreased demand and potential loss of income. These communities often rely on gem mining as a significant source of employment, thus magnifying the social and economic impacts of reduced market access.

U.S. Companies Dealing with Burmese Imports

U.S. importers and retailers previously engaged in trade with Burma might incur losses from existing inventories that can no longer be legally imported. Additionally, companies may face increased due diligence and compliance costs to ensure that their supply chains are free of Burmese gemstones.

Burmese Government Revenue

The Burmese government, which benefits from taxes and revenues generated from the gemstone trade, is financially harmed by the order. The restriction on exports reduces the government's capacity to generate revenue from one of its key natural resources, indirectly pressuring it to reassess its policy stance on democratic reforms and human rights.

Consumers Seeking Burmese Gemstones

Consumers with a particular interest in Burmese gemstones, known for their unique qualities, are deprived of legal access to these goods. The order curtails collector interest and the ability of enthusiasts to acquire and possess these distinctive minerals legally within the United States.

Historical Context

Continuation of Sanction Policies

Executive Order 13651 fits into a longer historical trajectory of U.S. foreign policy that uses economic sanctions as leverage for political change. Sanctions have long served as a tool for diplomatically isolating regimes that defy international norms, with similar measures observed in countries like Iran and North Korea. This policy approach reflects a belief in the efficacy of economic pressure to prompt changes where diplomatic efforts alone have failed.

Obama Administration's Human Rights Focus

The Obama administration emphasized "smart power," a combination of military strength, diplomacy, and economic measures, to address global challenges. Human rights and democratic governance were central themes throughout Obama's foreign policy, aligning with his strategy to employ economic sanctions as a means of encouraging political and social change in regimes with questionable human rights records.

Evolution of U.S.-Burma Relations

This Executive Order reflects an evolving relationship between the U.S. and Burma, as the latter nation showed tentative signs of political reform in the early 2010s. While small steps were made toward liberalizing its political environment under President Thein Sein, pervasive human rights challenges prompted the U.S. to maintain pressure until more substantial progress occurred.

Post-Cold War Sanctions Landscape

• In the post-Cold War era, the use of targeted sanctions became increasingly prevalent, often aimed at specific sectors, entities, or individuals. This contrasted with the broader embargoes of earlier decades and represented a shift toward minimizing collateral damage while focusing on key political or economic targets. Executive Order 13651's focus on gemstones typifies this strategic shift.

Legislative Foundations—The JADE Act

The Executive Order takes its roots from the legislative underpinnings of the Tom Lantos Block Burmese JADE Act of 2008, a law designed to curtail revenues from Burmese gemstones believed to finance government abuses. Its foundation lies in the recognition that targeted sanctions on valuable commodities can disrupt funding to oppressive regimes, underscoring a broader congressional consensus around the use of legislative instruments to complement executive action.

Potential Controversies or Challenges

Legal Disputes and Compliance Complexity

The complexity of enforcing Executive Order 13651 poses potential legal challenges, particularly surrounding the identification and regulation of jadeite and rubies under the Harmonized Tariff Schedule. Legal disputes may arise regarding the accurate classification of goods and potential disputes over the burden placed on businesses to identify the country of origin for their gemstone supplies.

Congressional Pushback

Subsequent legislative actions may reflect varied perspectives within Congress regarding the effectiveness of such economic sanctions. While generally supportive of pressure tactics on oppressive regimes, legislative bodies might question the collateral impacts on local populations and the feasibility of achieving significant policy changes through import bans alone.

International Relations Concerns

The U.S. faces potential diplomatic challenges in ensuring that its trade partners adhere to similar sanctions, particularly if competing markets exploit reduced competition to engage more deeply in Burmese trading. Maintaining a united international front is crucial to ensuring that the economic effects of the order are not undermined by alternative trade relationships.

Judicial Review and Industry Litigation

Industry pushback could manifest in judicial review or legal challenges from affected parties, particularly if they argue that this order disproportionately impacts their businesses without providing adequate state support for transition or adaptation. Such litigation could reach federal courts and challenge the extent of executive powers under IEEPA.

Long-term Effectiveness and Impact Measurement

Evaluating the long-term effectiveness of the order in achieving its policy objectives presents another challenge. Critics may question whether the order effectively induced political reform in Burma or merely served to escalate tensions and entrench economic hardship. Objective assessments of its impact on human rights and political changes are necessary to gauge its success.