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Case Studies in Sanctions and Terrorism

<< Case Studies Index

Case 78-8

United States v. Libya (1978–2004: Gadhafi, Terrorism)

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

See also Case 2011-1 [pdf]: US v. Libya (1978–2004: Gadhafi, Terrorism)

| Chronology of Key Events | Goals of Sender Country | Response to Target Country |
Attitude of Other Countries | Economic Impact | Assessment | Author's Summary |
Bibliography |

 

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)

December 20, 1995

The Senate overwhelmingly approves the "Iran Foreign Oil Sanctions Act of 1995" to impose secondary sanctions on companies that invest over $40 million in Iran's oil and gas industries (See case 84-1, US v. Iran). Senator Edward M. Kennedy (D-MA) adds a last-minute amendment to the bill that extends sanctions to Libya. (Inside US Trade, 22 December 1995, 6)

December 21, 1995

In response to Congressional pressure to pass legislation to impose sanctions on Libya's investment partners, the White House calls on the United Nations to enact tighter sanctions on oil equipment exports to Libya. (Wall Street Journal, 22 December 1995, A4)

January 22, 1996

In a letter to Senate Majority Leader Robert Dole (R-KS), the European Union (EU) strongly criticizes US efforts to impose extraterritorial sanctions in relation to Iran and Libya. (Inside US Trade, 9 February 1996, 17)

May 8, 1996

Administration officials, citing the potential for angering European allies and undermining the UN effort to isolate Tripoli, press Congress to terminate efforts to impose secondary sanctions against foreign firms that invest in Libya. (Inside US Trade, 10 May 1996, 16)

May 1996

Relatives of the victims of the Pan Am 103 bombing file suit against the government of Libya, taking advantage of the opportunities opened by the Anti-Terrorism Act of 1996, which allows victims of terrorist acts abroad to sue foreign countries in US courts.
(Washington Post, 7 May 1996, A13)

July 17, 1996

TWA Flight 800 explodes in midair off the coast of Long Island, killing all 230 on board. Terrorism is suspected but subsequently disproved.
(Journal of Commerce, 19 July 1996, 12B)

July 23, 1996

Congress passes the Iran and Libya Sanctions Act (ILSA). The legislation mandates sanctions when companies: invest more than $40 million in gas and oil development in Libya, or export goods or technology prohibited by UN resolutions which would help Libya acquire weapons, or boost Libya's aviation capabilities. In response, the president must impose two or more of the following six sanctions:

1) Denial of credits from the US Export-Import Bank
2) Denial of export licenses for controlled goods or technology
3) Prohibition of loans of more than $10m from US financial institutions for a 12-month period
4) Prohibition of foreign financial institutions from dealing in US government debt or US government funds
5) Prohibition against participation in any US government procurement project
6) Import restrictions

These sanctions are required to be in effect for up to two years, and in "no case" can they be applied for less than one year. But the bill allows the President to waive "all or part" of the sanctions against a foreign company if doing so is deemed to be in the national interest. The bill has a sunset provision that terminates it five years after enactment. (Financial Times, 25 July 1996, 4; Inside US Trade, 26 July 1996, 4; PL 104-172)

July 24, 1996

The EU expresses outrage at the passage of the Iran and Libya Sanctions Act. The European Commission announces that a regulation being drafted to retaliate against US sanctions on foreign companies trafficking in expropriated US property in Cuba (the Helms-Burton legislation, see Case 60-3) could also be used to retaliate against the Iran and Libya Sanctions Act.
(New York Times, 25 July 96, A14)

July 31, 1996

The UN Security Council warns Gadhafi not to defy UN sanctions, and declares that his expressed intention to fly anywhere he wishes, in violation of the air ban, is unacceptable.
(Journal of Commerce, 1 August 1996, 5A)

August 5, 1996

President Clinton signs the Iran and Libya Sanctions Act at a ceremony attended by relatives of victims of the 1988 bombing of Pan Am Flight 103.
(New York Times, 6 August 1996, A1)

August 8, 1996

French President Jacques Chirac warns the US of "immediate retaliation" if French companies are targeted under the new Iran and Libya Sanctions Act. French energy firms Total and Elf have expressed interest in increasing investment in Iran and Libya. (Journal of Commerce, 8 August 1996, 2A)

August 19, 1996

German authorities arrest two men on suspicion of smuggling high-technology equipment to Libya to enable it to manufacture lethal nerve gas.
(Journal of Commerce, 20 August 1996, 3A)

August 1996

After a trip to the Middle East and Libya, Louis Farrakhan applies to the US Treasury Department for permission to accept a $1 billion donation from Gadhafi. (Wall Street Journal, 26 August 1996, A1)

August 21, 1996

The EU announces that it will appeal to the World Trade Organization if the US punishes any European companies for doing business with Iran or Libya. (Financial Times, 22 August 1996, 3)

August 28, 1996

US Treasury denies Farrakhan's application. Congress later passes broad legislation to prohibit such transactions in the future. (See Case 93-5, US v. Sudan [1993- : Terrorism]; Case 86-1, US v. Syria [1986- : Terrorism]) (Financial Times, 30 August 1996, 5)

October 7, 1996

The US criticizes Turkish Prime Minister Necmettin Erbakan for visiting Libya and signing a new bilateral trade pact. Erbakan counters that his primary objective was to secure repayment of an outstanding debt of $300 million. (New York Times, 8 October 1996, A5)

October 14, 1996

Libya announces that UN sanctions are taking a "tragic toll" on the country, costing $19 billion and causing as many as 21,000 deaths in the past three and a half years. Libya claims agriculture is the hardest-hit sector, with losses estimated at $5.9 billion.
(International Herald Tribune, 14 October 1995, 13)

November 5, 1996

Ente Nazionale Idrocarburi (ENI), Italy's state oil company, announces that it signed a deal in June 1996 to develop Libya's natural-gas resources and build a pipeline to Italy for an estimated $3 billion.
(Wall Street Journal, 5 November 1996, A19)

January 1, 1997

1 January 1997 Libya sentences to death six spies accused of passing defense secrets to foreign governments. According to Egyptian experts, this case may be related to a military coup attempt in October 1993. (Financial Times, 2 January 1997, 2; International Herald Tribune, 3 January 1997, 3)

March 10, 1997

In defiance of US efforts to isolate the Gadhafi regime internationally, the Vatican establishes full diplomatic relations with Libya to "recognize recent positive results in the area of religious freedom."
(International Herald Tribune, 11 March 1997, 6)

May 5, 1997

A group of US senators led by Edward M. Kennedy urges US Ambassador to the UN Bill Richardson to introduce a Security Council resolution for an oil embargo, calling it the only sanction likely to bring about Libyan compliance with UN demands.
(Journal of Commerce, 5 May 1997, 3A)

May 8, 1997

Gadhafi violates UN sanctions by flying to Niger to meet President Ibrahim Barré Mainassara. (Agence France-Presse, 13 May 1997; USA Today, 9 May 1997, 6A)

August 17, 1997

Four African leaders-the presidents of Burkina Faso, Chad, Mali, and Niger-issue a statement calling on the UN to look into the impact of economic sanctions on Libya. They meet with Gadhafi and jointly call on each country to "develop their economic relations and reinforce the mechanisms of cooperation with the goal of reinforcing stability in the region."
(Agence France-Presse, 17 August 1997)

September 21, 1997

In defiance of UN sanctions against Libya, the Arab League approves a resolution urging Arab countries to "take measures to alleviate the sanctions on Libya," including allowing Gadhafi to travel by plane to member states. The resolution also authorizes humanitarian flights and encourages member countries to release Libyan nonoil funds frozen in Arab banks.
(New York Times, 22 September 1997)

October 1997

Despite US opposition, South African President Nelson Mandela travels to Libya for a diplomatic visit; complying with UN flight ban, he flies to a border town and arrives by road. Mandela, who is grateful for Gadhafi's support in the fight against apartheid, is the most influential visitor to Libya since the 1992 flight ban. He presents Gadhafi with South Africa's Order of Good Hope, the country's highest award for a foreigner. (Washington Post, 23 October 1997, A27; Washington Post, 30 October 1997, A30)

October 1997

The Libyan government sends letters to families of victims of Pan Am 103, urging them to accept a financial settlement and oppose sanctions.
(Seattle Times, 19 October 1997, A17)

December 2, 1997

New York Times reports that a massive Libyan underground pipe project, the Great Man-Made River Project, could serve as a conduit for troops and military vehicles. The pipeline, made of pipes 13 feet in diameter, has large underground storage facilities every 50 or 60 miles and runs through a mountain where intelligence sources report Gadhafi is constructing a chemical and biological weapons plant.
(New York Times, 2 December 1997, A1)

February 26, 1998

US District Judge Thomas Platt rules that families of the victims of Pan Am 103 bombing can sue Libya. Lawyers argue that frozen Libyan assets could be used to pay award damages to the families. The decision is appealed by Libya. (Newsday, 4 March 1998, A28)

February 27, 1998

Acting on Libya's March 1992 complaint, the International Court of Justice in The Hague rules that it has authority to decide whether Libya must surrender two of its citizens for trial over the Pan Am 103 bombing in 1988. The US, the UK, and France had unsuccessfully argued against ICJ involvement, on the grounds that the UN Security Council's 1992 and 1993 resolutions precluded the court's involvement. Libya argued that under the 1971 Montreal Convention against aviation terrorism it is not required to extradite the two agents and has the right to try the suspects itself or send them to a neutral country for trial. Calling the ruling a victory, Libya claims the UN sanctions should be declared null and void. (New York Times, 28 February 1998, A4; Financial Times, 28 February 1998, 4)

March 20, 1998

At the request of the Libyan government, the UN Security Council holds a debate on sanctions against Libya. In response to Libyan claims of injury, US Ambassador Richardson argues that "if Libya suffers economically, it is certainly not because of UN sanctions," and points out that UN sanctions "are targeted sanctions, imposed to address aspects of Libyan involvement in international terrorism, but specifically designed to prevent suffering among the Libyan people." (Agence France-Presse, 6 March 1998; US Information Service, 20 March 1998; Washington Post, 21 March 1998, A18)

April 12, 1998

Libya agrees to let Germany question its agents about a discotheque bombing that killed two US servicemen and a Turkish woman in 1986.
(Washington Post, 12 April 1998, A20)

June 8, 1998

The heads of state of the Organization of African Unity (OAU) call on African nations to suspend compliance with the UN air embargo on Libya for all religious, humanitarian, or OAU-related flights. The OAU also asserts that it will ignore all sanctions on Libya starting in September if the US and the UK have not agreed by then to try the Pan Am 103 bombing suspects in a third country. State Department spokesman James Rubin states, "We are extremely disturbed by this short-sighted action, which constitutes a direct assault on the authority of the Security Council ..." and calls on OAU member states to ignore the OAU resolution. (US Department of State, 10 June 1998; US Information Service, 12 June 1998)

August 24, 1998

Secretary of State Madeleine Albright and UK Foreign Secretary Robin Cook unveil a proposal to hold the trial of the two suspects in the Pan Am 103 bombing under Scottish law in a court in Netherlands. If convicted, the suspects are to serve time in British prison. Albright stresses that the deal is a "take-it-or-leave-it proposition" and that the US will push for additional sanctions, including an oil embargo, if Libya refuses the offer. (Washington Post, 25 August 1998, A1, A11; Financial Times, 25 August 1998, 5)

August 25, 1998

The Arab League, Egypt, Sudan, and South African President Nelson Mandela express support for the US-UK proposal. (Scotsman, 26 August 1998; New York Times, 26 August 1998, A7)

August 27, 1998

The UN Security Council votes to suspend sanctions on Libya if Gadhafi extradites the Pan Am 103 bombing suspects for trial in The Hague and cooperates with the French investigation into the 1989 bombing of UTA Flight 772. The Security Council threatens additional measures if Libya does not surrender the suspects for trial. Libyan acceptance of the offer, however, will not necessarily end unilateral American sanctions. (Agence France-Presse, 6 September 1998; US Information Service, 28 August 1998; Financial Times, 26 August 1998, 4; 29-30 August 1998, 4; New York Times, 25 August 1998, A9)

August 27, 1998

Having accepted the proposal in principle a few days earlier, Gadhafi asks for a variety of guarantees to ensure fair treatment of the suspects before he will surrender them for trial in the Netherlands.
(Washington Post, 28 August 1998, A26)

September 5-6, 1998

The presidents of Niger, Chad, Mali, Eritrea, and Sudan defy the UN air embargo and fly to Libya to celebrate anniversary of Gadhafi's accession to power in 1969. (Agence France-Presse, 6 September 1998)

September 29, 1998

In a speech to the UN General Assembly, Libya's UN ambassador, Abuzed Omar Dorda, describes the US-UK offer on the Pan Am 103 bombing suspects to be "honey with a dose of poison." Dorda demands guarantees that the suspects will not be extradited to the US or the UK and that if convicted they would serve their sentences in a third country or in Libya. (Washington Post, 27 October 1998, A16; Washington Post, 30 September 1998, A20)

October 26, 1998

American and British officials maintain that Libya's demand for the Pan Am 103 bombing suspects to serve any sentence outside the US and the UK is not acceptable. The US official says that "if Libya continues to press its demand, there can be no agreement." (Washington Post, 27 October 1998, A16)

December 5, 1998

UN Secretary-General Kofi Annan meets with Gadhafi in Libya to try to break the deadlock on transferring the Pan Am 103 bombing suspects; describes their discussions as "fruitful and positive."
(Washington Post, 6 December 1998, A35)

December 21, 1998

At a memorial service marking the tenth anniversary of the Pan Am 103 bombing, President Clinton states that if Libya does not surrender the suspects for trial before the UN reviews the sanctions against Libya in February, the US will press for harsher sanctions. (New York Times, 30 January 1999, A3; US Information Service, 21 December 1998)

February 26, 1999

The US and Britain reiterate that unless Gadhafi releases the Pan Am 103 bombing suspects for trial within 30 days, they will press for more sanctions in the UN Security Council. However, they fail to convince the Security Council to impose a precise deadline. (New York Times, 27 February 1999, A3; Washington Post, 27 February 1999, A13)

March 10, 1999

France convicts six Libyans in absentia for the 1989 bombing of the UTA airliner over Niger. Because French law does not recognize convictions in absentia, the six would have to be retried if they are extradited to France. (Washington Post, 11 March 1999, A23)

March 19, 1999

After talks in Tripoli, South African President Nelson Mandela announces that Libya agreed to hand over the suspects for trial on April 16.
(Financial Times, 20-21 March 1999, 1)

April 5, 1999

1999 The two Pan Am 103 bombing suspects, 47-year-old Abdel Basset Ali al-Meghrahi and 43-year-old Lamen Khalifa Fhimah, are delivered from Libya to The Hague for trial. Three Scottish judges will decide the case. If convicted, the men will serve their sentences in a Scottish jail under UN supervision. Britain reportedly assured Gadhafi that no witnesses would come from Libya and that all witnesses would have immunity from arrest. Britain also reportedly told Gadhafi that the evidence was only against al-Meghrahi and Fhimah, and not against higher members of the Libyan government. UN Secretary-General Annan announces that UN sanctions against Libya will be suspended, and can be lifted after 90 days. Annan reportedly gave Gadhafi assurances that a new resolution would be needed to reinstate the sanctions. The unilateral US sanctions, however, remain in force. State Department spokesman James Rubin says the US wants "additional concerns alleviated." (CNN.com, 5 April 1999; Wall Street Journal, 6 April 1999, A28; Financial Times, 15 February 1999, 1; 6 April 1999, 12; 7 April 1999, 11)

April 22, 1999

At the first major investor conference in Geneva after UN sanctions were suspended, the head of exploration at Libya's National Oil Corporation Ibrahim Bagger assures US oil companies that Libya will honor the 1986 standstill agreement although it lapsed in 1989.
(Journal of Commerce, 22 April 1999, 9A)

April 28, 1999

President Clinton announces that the United States will exempt exports of food and medicine from future sanctions imposed by the executive branch. The new rules also apply to food and medicine sales to Iran, Libya, and Sudan, which will be permitted on a case-by-case basis. Specific licensing rules will be drawn up for each country and there will be no US government funding, financing, or guarantees for the sales. (USIS, 28 April 1999)

June 11, 1999

At the first official meeting between US and Libya in 18 years, US Representative to the UN A. Peter Burleigh tells Libya that the United States will not support permanent lifting of UN sanctions until Libya stops supporting international terrorism and meets other conditions required by UN resolutions, including compensation payments to the victims' families and full cooperation with the trial.
(New York Times, 12 June 1999, A4)

July 8, 1999

UK announces resumption of diplomatic ties with Libya after 15 years. Relations are renewed after Libya accepted "general responsibility" for the 1984 shooting of a policewoman outside the Libyan embassy in London and agreed to compensate her family. (Financial Times, 8 July 1999, 8; Washington Post, 8 July 1999, A18)

July 17, 1999

Libya pays $31 million to France to compensate the families of those killed in the bombing of UTA flight in 1989. French Foreign Ministry states that payment is acknowledgment by Libya that its officials were responsible for the deaths.
(New York Times, 17 July 1999, A5)

July 28, 1999

Italy's state oil company ENI announces it has reached final agreement with Libya to invest $5.5 billion to develop oil and gas reserves. The initial agreement dates back to June 1996. Libya is seeking $35 billion in investments between 2001-2005. (The Wall Street Journal, 28 July 1999, A17; Financial Times, 7 October 1999, 9)

December 1, 1999

Italian Prime Minister Massimo D'Alema is the first Western leader to visit Libya in 8 years. (New York Times, 2 December 1999, A5; Financial Times, 3 December 1999, 9)

March 20, 2000

Japan announces it no longer considers Libya a terrorist threat and that it is considering lifting sanctions. (Reuters, 20 March 2000)

May 3, 2000

Lockerbie trial begins in Camp Zeist, the Netherlands. The two defendants, Abdel Basset Ali Mohmed al-Meghrahi and Al-Amin Khalifa Fhimah, are charged with murder, conspiracy to murder, and violation of the 1982 Aircraft Security Act. The suspects plead not guilty and blame Palestinian terrorists for the crime. (Financial Times, 3 May 2000, 8; Washington Post, 4 May 2000, A1)

August 25, 2000

To counter speculations of a secret deal with Libya, Secretary General Kofi Annan releases the letter sent to Gadhafi that led to a compromise on Lockerbie trial. The letter assures Gadhafi that the trial will not be used by the United States and the United Kingdom to undermine his regime and that standard Scottish trial procedures will be followed. (New York Times, 26 August 2000, A6; Washington Post, 26 August 2000, A14)

October 20, 2000

French court, rejecting arguments that Gadhafi is immune from prosecution as head of state, rules that a case against the Libyan leader over the bombing of French airliner UTA can proceed.
(Washington Post, 21 October 2000, A18)

January 8-10, 2001

Arguing that prosecution failed to present sufficient evidence to secure a conviction, defense rests its case in the Lockerbie trial. Two days later, prosecution drops all but the murder charges. (Washington Post, 9 January 2001, A16; 10 January 2001, A15)

January 31, 2001

In a unanimous ruling Scottish judges find Abdel Basset al-Megrahi guilty of murder and sentence him to life in prison, but acquit second defendant, Al-Amin Khalifa Fhimah. The United States makes clear that the verdict alone will not lead to lifting of sanctions. Libya needs to meet other requirements laid out in the Security Council resolutions, including compensation to the victims' families and the acceptance of responsibility. The United Kingdom supports US position. (USIS, 31 January 2001; Washington Post,1 February 2001, A1, New York Times, 1 February 2001, A8)

February 2, 2001

During welcome home celebrations for Al-Amin Khalifa Fhimah, Gadhafi announces Libya will not pay compensation to the victims' families or acknowledge official responsibilities. A few days later Gadhafi charges that the Lockerbie verdict was "politically tainted" and reiterates that no compensation will be paid. (Washington Post, 2 February 2001, A1; 6 February 2001, A14; New York Times, 2 February 2001, A1, A11; 6 February 2001, A10)

February 7, 2001

Lawyers of the convicted Libyan file an appeal of his murder conviction. (Associated Press, 7 February 2001)

July 27, 2001

Congress renews the Iran-Libya Sanctions Act of 1996 for another five years despite opposition from the US business community and the Bush administration. Closing current loopholes, the ILSA Extension Act of 2001 lowers the threshold for foreign investment in Libya from $40 million to $20 million and defines amendments and modifications to existing contracts as new contracts. The act also requires the president to submit a report to Congress within 24 to 30 months on the effectiveness of the sanctions, their impact on other US economic and foreign policy interests, and the humanitarian situation in Iran and Libya. The president can also recommend that ILSA be modified or terminated. European Commission criticizes the extension of ILSA and threatens to retaliate if sanctions are imposed against European companies. (International Trade Reporter, 2 August 2001, 1243; White House press release, 3 August 2001; Katzman 39-40; Reuters, 3 August 2001)
September 2001 Gadhafi condemns the terrorist attack in New York and Washington as "horrifying" and offers the United States intelligence assistance on Osama bin Laden and al-Qaeda. (Wall Street Journal, 14 January 2002, A4; Economist, 19 January 2002, 39)
November 14, 2001 German court finds four people guilty of involvement in the bombing of a West Berlin nightclub in 1986. The court concludes that the "the Libyan state was at least to a large extent responsible" because the attack "was planned by members of the Libyan secret service in senior positions in the Libyan [embassy] in East Berlin." (Financial Times, 14 November 2001, 6; New York Times, 14 November 2001, A5)
November 2001 Libyan envoy to the United Nations Abdurrahman Mohamed Shalghem notes that Libya "is a party to most international agreements in the field of disarmament, and is in the process of acceding to the rest, including the Chemical Weapons Convention and the Nuclear Comprehensive Test Ban Treaty." In February, US Secretary of Defense William Perry had hinted at a possible US military strike to prevent the underground chemical plant at Tarhuna from becoming operational. (New York Times, 20 December 2001, B1, B4)
March 15, 2002 Appeal by Abdel Basset al-Meghrahi of his life sentence in connection with Lockerbie bombing is denied.
(Financial Times, 15 March 2002, 8)
March 12, 2003 Libya agrees to take some measure of responsibility for the Pan Am bombing after US and UK assurance that the move would not be used as grounds for legal action against the government. Compensation of victims and acceptance of responsibility are conditions for the lifting of UN sanctions. US deputy secretary of state Richard Armitage states, "We are in striking distance of an agreement to lift [UN] sanctions. But no one in the State Department is talking about lifting US sanctions. Our concern is weapons of mass destruction. The UN's is Lockerbie." (Washington Post, 12 March 2003, A8; Financial Times, 14 March 2003, 11; 1 May 2003, 6)
August 13, 2003 Lawyers for the families of the Pan Am victims and Libya sign an agreement on $2.7 billion in compensation, to be deposited in an account at the Bank of International Settlements. The proposed payments schedule is closely linked to the lifting of UN and US sanctions. Families will receive $4 million after UN sanctions are lifted, another $4 million when US sanctions are lifted, and a final $2 million once Libya is removed from the list of state sponsors of terrorism. In order for families to receive the second and third installments, US sanctions must be lifted within eight months. (New York Times, 13 August 2003, A8; Financial Times, 15 August 2003, 2; Washington Post, 16 August 2003, A15)
August 15, 2003 Libya submits a letter to the UN Security Council accepting responsibility for the bombing of Pan Am flight 103 as a "sovereign state accepting responsibility for the actions of its officials." Wording of Libya's letter, carefully negotiated in talks with the United Kingdom and the United States, ties its legal responsibility to the employment of Meghrahi, not to an admission of government involvement. Fulfilling the remaining UN condition, Libya also officially renounces all forms of terrorism. (Washington Post , 16 August 2003, A1; New York Times, 16 August 2003, A6)
August 18, 2003 The United Kingdom submits a resolution calling for the lifting of UN sanctions. Secretary of State Powell states that "[t]he lifting of sanctions at the United Nations will not affect U.S. bilateral measures, which will remain in place." France threatens to veto the resolution unless Libya offers larger compensation to families of UTA bombing victims. (International Trade Reporter, 21 August 2003, 1405; Washington Post, 19 August 2003, A16)
September 12, 2003 The UN Security Council formally lifts 11-year-old sanctions against Libya after Libya and France reach a tentative agreement on the UTA issue. France and the United States abstain from the 13-0 council vote. (Financial Times, 12 September 2003, 6; 13-14 September 2003, 3)
December 19, 2003 President Bush and British Prime Minister Blair announce that, after nine months of secret negotiations, Libya has agreed to disclose and dismantle its nuclear, biological, and chemical weapons programs; accede to the Chemical Weapons Convention; destroy all missiles with a range greater than 180 miles, and allow international inspectors unconditional access to monitor and verify compliance. The agreement follows the seizure of illegal shipments of uranium-enrichment equipment to Libya in early October as part of the US-led Proliferation Security Initiative launched in May. Bush administration emphasizes that the United States will not offer rewards or lift sanctions until Libya actually starts dismantling its weapons of mass destruction. (New York Times, 20 December 2003, A1; 21 December 2003, 21; Washington Post, 20 December 2003, A1, A18; 23 December 2003, A14; Wall Street Journal, 31 December 2003, A4)
December 28, 2003 International Atomic Energy Agency Director Mohamed El Baradei and a team of inspectors arrive in Libya for the first inspection of four previously undeclared nuclear facilities. Inspectors praise Libya's cooperation. (Washington Post, 29 December 2003, A13; New York Times, 30 December 2003, A9)
January 9, 2004 Libya signs an agreement with France on payment of an additional $170 million to the families of people killed in the bombing of the UTA 722 flight.
(Washington Post, 10 January 2004, A1)
January 14, 2004 Libya ratifies the nuclear test ban treaty and agrees to host a station monitoring compliance with the treaty on its territory. Libya also ratified the Chemical Weapons Convention. ( Washington Post , 15 January 2004, A18; International Trade Reporter , 22 January 2004, 146)
January 19, 2004 US and UK weapons experts return to Libya to begin dismantling, removing, and destroying technology and materials related to Libya's weapons of mass destruction programs. (New York Times, 20 January 2004, A3)
End of January 2004 US military transports 55,000 tons of nuclear-related equipment and material from Libya to the US. Wall Street Journal reports that shipment is only 5 percent of equipment the US plans to remove but contains the most sensitive items. (Wall Street Journal, 2 February 2004, A3)
February 9, 2004 Foreign Minister Abdurrahman Shalgam arrives in London for the first visit by a Libyan foreign minister since 1969 and the first cabinet level contact. (Financial Times, 6 February 2004, 5; 9 February 2004, 3)
February 26, 2004

President Bush issues executive order lifting travel restrictions to Libya and authorizing US companies with pre-sanctions holdings in Libya to negotiate the terms of their re-entry. Action was delayed for two days after Libyan Prime Minister Skuri Ganem denied Libya was responsible for Lockerbie bombing. Meeting US demands Libyan government releases statement calling Ganem’s comment “inaccurate and regrettable” and reaffirming its responsibility. (New York Times, 24 February 2004, A6; 26 February 2004, A6; Inside US Trade, 27 February 2004)

March 5, 2004

Libya hands over numerous documents detailing its chemical weapons program to the Organization for the Prohibition of Chemical Weapons (OPCW). OPCW’s director general Rogelio Pfirter praises Libya’s cooperation with the organization. (Washington Post, 6 March 2004, A14; New York Times, 6 March 2004, A5)

March 6, 2004

Shipment of remaining nuclear weapons equipment leaves Libya for the US. (Washington Post, 7 March 2004, A17)

March 25, 2004

Prime Minster Tony Blair travels to Tripoli to meet with Gadhafi. After the meeting, Blair announces that British company Shell signed a $200 million deal to explore oil and natural gas in Libya. (New York Times, 26 March 2004, A3; Washington Post, 26 March 2004, A14)

April 23, 2004

In recognition of Libya’s progress in dismantling its WMDs, President Bush terminates the application of Iran-Libya Sanctions Act (ILSA) with respect to Libya and the Department of Treasury modifies sanctions imposed on US companies under IEEPA to allow for the resumption of most commercial activities, financial transactions, and investments. Decision allows US oil companies to sign contracts and do business with Libya. However, Libya remains on the State Departments list of state sponsors of terrorism and subject to export-licensing for dual-use items. In addition, the freeze of Libyan assets and restrictions on direct air service between Libya and US remain in force. (White House Press Release, 23 April 2004; International Trade Reporter, 29 April 2004, 754; Inside U.S. Trade, 30 April 2004, 22)

April 27, 2004

Gadhafi arrives in Brussels for two-day visit to meet with EU officials to discuss his country’s eventual membership in the Euro-Mediterranean Partnership.
(New York Times, 28 April 2004, A3)

June 29, 2004

US formally resumes diplomatic relations with Libya and opens Liaison Office in Tripoli.
(Washington Post, 29 June 2004, A15)

July 27, 2004

Members of World Trade Organization (WTO) agree to start membership negotiations with Libya. Consideration of Libya’s application had been blocked by the US since November 2001. (Financial Times, 28 July 2004, 6; International Trade Reporter, 29 July 2004, 1295)

August 10, 2004

Libya agrees to pay $35 million to non-American victims of bombing of a Berlin disco in 1986. Germany insists that EU arms embargo against Libya cannot be lifted until Tripoli pays compensation. (New York Times, 11 August 2004, A6; Financial Times, 25 March 2004, 6)

September 20, 2004

President Bush declares national emergency with respect to Libya ended and lifts trade embargo and remaining commercial and travel restrictions imposed on Libya. Steps taken include releasing $1.3 billion in frozen assets, lifting the ban on Ex-Im Bank loans, OPIC guarantees, support from US agriculture department programs, and removing restrictions on direct flights between the two countries. However, Libya remains on the list of state sponsors of terrorism. US decision to lift sanctions comes ahead of September 22 deadline for the release of additional payments to the victims of Pan Am flight 103. Libya had extended the deadline twice since April. (New York Times, 21 September 2004, A7; Financial Times, 21 September 2004, 1; Statement by White House Press Secretary, 20 September 2004)

September- October 2004 European Union formally ends suspended UN sanctions and a separate EU arms embargo imposed against Libya. Italy pledges to provide military equipment so that Libya can cooperate in tracking clandestine immigration. (Reuters, 22 September 2004; Financial Times, 23 September 2004, 6; Le Monde, 1 October 2004; Le Monde, 11 October 2004)
16 December 2004 The vice-president of the Central Bank of Libya announces the receipt of assets frozen by US government. The original frozen amount was $400 million, but the amount released totaled $1 billion due to accrued interest.
(Les Echos, 16 December 2004)
23 December 2004

Saudi Arabia recalls its ambassador to Tripoli and expels Libyan ambassador after it discovers evidence of a Libyan plot to kill a member of the royal family
(Agence France Presse, 23 December 2004)

30 January 2005

Occidental Petroleum Corporation wins the lion share of oil exploration permits, the first auction conducted by the Libyan government in 40 years.
(Agence France Presse, 31 January 2005)

10 February 2005

State Department confirms willingness to fully normalize relations with Libya. Two days later, the State Department eliminates movement restrictions for Libyan diplomats in the United States. (Agence France Presse, 10 February 2005; Reuters, 11 February 2005)

12 April 2005

In interview with Frankfurter Allgemeine Zeitung, Seif el-Islam Gadhafi, son of Moammar Gadhafi, announces Libya’s intent to invest in the United States, if US lifts the remaining sanctions against Libya.
(Agence France Presse, 12 April 2005)

19 August 2005

US Senator and Chair of the Foreign Affairs Committee, Richard Lugar (R-IN), visits Tripoli. Moammar Gadhafi expresses frustration at the pace of normalization of bilateral relations. At the end of the visit, Seif el-Islam Gadhafi announces that Libya will be removed from the list of state sponsors of terrorism, provided that both sides make progress in addressing certain concerns.
(Agence France Presse, 19 and 23 August 2005)

19 September 2005

Relatives of UTA 772 flight victims, which exploded 9 months after the Lockerbie tragedy and for which Libya had also accepted responsibility, file a suit in a federal court in Washington, DC, against the government of Libya. (PR Newswire Europe, 19 September 2005)

20 December 2005

The Federal Reserve and US Treasury fine Dutch bank ABN Amro Holding NV $80 million for violating US anti-money laundering laws and sanctions against Iran and Libya. (Wall Street Journal, 20 December 2005, A3).

January 2006

Several European and American oil and gas companies negotiate return to Libya. (Agence France Presse, 30 December 2005; Gale Group Inc, 1 February 2006; Europe Information Energie, 12 January 2006; Aeronautique Business, 2 February 2006)

23 March 2006

The US Export-Import Bank announces that it is open for business with Libya. (Inside US Trade, Vol.24 N.12)

16 May 2006

US announces three new measures to normalize relations with Libya. The American liaison office in Tripoli will be upgraded to an embassy; Libya will be removed from the list of state sponsors of terrorism; and Libya will be removed from the list of states not fully cooperating with US antiterrorism efforts. (US State Department briefing, 15 May 2006)

July 2006

The United States removes Libya from the list of countries that sponsor terrorism. Libya still owes $2 million per victim but has removed funds earmarked for that payment from an escrow account in Switzerland due to expiration of the settlement agreement.
(International Herald Tribune, 8 July 2006, 3)


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