WORLD -- November 8, 2011 at 2:54 PM EDT

How a Little-Known Law Aims to Keep the Screws on Iran

By: Larisa Epatko

Protesters in Iran mark the anniversary of the Nov. 4, 1979, storming of the U.S. Embassy in Tehran by burning a mock "wanted" poster of President Obama. Photo by Atta Kenare/AFP/Getty Images.

In the days after the U.S. Embassy and its staffers were taken hostage in Tehran in 1979, the United States invoked an obscure law and declared Iran a threat to its national security. Thirty-two years later, amid a new U.N. report that Iran is still pushing a nuclear weapons program and allegations that it tried to assassinate the Saudi Arabian ambassador to Washington, President Obama has renewed the declaration that the clerical regime is still a threat.

Under the International Emergency Economic Powers Act, the United States has classified Iran as a national emergency threat since the hostage crisis of 1979. That year, a group of Iranian students and militants took 52 Americans hostage at the U.S. Embassy in Tehran for 444 days. The designation of Iran under the emergency law gave the president new powers to impose financial restrictions on Iran, including freezing Iranian assets in the United States.

Late Monday, President Obama submitted a notice to the Federal Register to extend it for another year.

"Our relations with Iran have not yet returned to normal," the president wrote in the notice, and Iran continues to pose an "extraordinary threat" to U.S. national security, foreign policy and economy.

Immediately after the resolution of the hostage crisis, the two countries reached agreements on some of the immediate outstanding financial issues, including the release of assets. But since that period in the 1980s, there's been a gradual tightening of financial measures.

The national emergency law provides a framework for such financial restrictions on countries that post threats to the United States, but it isn't as well known or gets as much attention as the sanctions regime, which the United States also has used against Iran, said Suzanne Maloney, a senior fellow with the Brookings Institution's Saban Center for Middle East Policy.

Recent revelations have furthered the case against Iran. In October, two men with alleged ties to Iran's special operations Quds Force were charged with conspiring to kill Saudi Ambassador to the U.S. Adel Al-Jubeir.

And this week, the U.N. nuclear agency is issuing a report saying it has new evidence that Iran is trying to make a nuclear device -- allegations the Islamic Republic denies.

"It's part of a fabric of bilateral estrangement," Maloney said. "The nuclear issue is one of a range of concerns."

The next longest-running countries declared threats under the emergency law are Myanmar for repression against democracy advocates and Sudan for human rights violations, both since 1997. The most recent country given the classification was Libya in 2011 for attacks against civilians.

We'll have more on the U.N. report on nuclear developments in Iran on Tuesday's NewsHour. View all of our World coverage and follow us on Twitter.

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