President Uses Wide Powers of 1977 Law

Times Staff Writer

President Reagan's far-reaching order threatening legal action against any American remaining in Libya is based on a 1977 law that gives a President sweeping powers to act once he has informed Congress that a foreign emergency exists.

The law is called the International Emergency Economic Powers Act and, according to a former senior Treasury Department official who was involved in drafting it, "after he goes through some procedural hoops, it is pretty wide open what the President can do." The former Treasury official, Fred Bergsten, now heads the Institute for International Economics.

For example, a Justice Department official said, under the law, an American who remains in Libya after Feb. 1 could face penalties ranging from a $10,000 fine for a civil violation to a $50,000 fine and up to 10 years in prison on a felony conviction.

Reagan's order has few precedents in American history and is so sweeping that it effectively prevents Americans from living in Libya legally, almost regardless of the circumstances. A senior Administration official said it bans routine commercial transactions.

"You'd have to live the existence of a monk" to remain there and comply with the law, the Justice Department official said.

Since many of the roughly 1,500 Americans still living in Libya are believed to be spouses and children of Libyan citizens, the President's order theoretically could lead to federal prosecution of mothers and children. But legal experts noted that prosecutors have broad discretionary authority and that charges are not likely to be pressed in such situations.

Business Vulnerable

Instead, the primary targets of federal legal action would probably be businessmen and corporations that remain in Libya and try to engage in commerce. And in such cases, legal scholars said, U.S. courts are unlikely to interfere with any reasonable Administration action--even those that might restrict the rights of American citizens.

"In the foreign affairs sphere, the concept of individual rights is very limited," said C. Thomas Dienes, a professor of constitutional law at George Washington University Law School. "The (Supreme) Court has always recognized extremely broad powers, especially when the President and Congress are acting in tandem."

A decade or more ago, the Supreme Court prevented the government from interfering with Americans' foreign travel to such countries as Cuba and Vietnam, it has more recently moved to allow travel restrictions.

The law, with its wide-ranging sanctions, has been invoked in other instances by President Jimmy Carter, particularly when he moved to cut off trade with Iran during the 1979-81 hostage crisis and seized about $4 billion of Iranian assets held in U.S. banks. Similarly, it gave Carter the right to impose a Soviet grain embargo after the invasion of Afghanistan.

'Broad Discretion'

Presidents had generally relied on the older Trading With the Enemies Act to impose sanctions against foreign countries, but the 1977 law restricted a President's right to invoke that legislation except in cases of war.

Nonetheless, the 1977 law gives a President "very broad discretion" to ban American citizens and corporations from dealing with outlaw countries like Libya, said Henry M. Schuler, who runs the energy security studies program at the Georgetown University Center for Strategic and International Studies.

Because of earlier charges of Libyan leader Moammar Kadafi's involvement with terrorism, U.S. economic sanctions against Libya have been tightened in stages since they were first imposed in 1978, after Carter placed Kadafi's regime on a list of countries that support terrorism.

Now, Reagan has removed ambiguities and closed loopholes that allowed Americans to live and work in Libya, noted Schuler, who worked there for a total of 10 years for the State Department and for private U.S. corporations.

Times staff writers Ronald J. Ostrow and Robert A. Rosenblatt contributed to this story.

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