U.S. Eyes 18th-Century Law to Seize and Sell Iranian Oil
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The US government is exploring an unusual legal route for dealing with Iranian oil and ships captured as part of its blockade: bringing back a wartime maritime system that has barely been used for generations, according toBloomberg.
The Justice Department, working with the Pentagon, is preparing to useprize law, which historically allowed courts to decide whether vessels and cargo captured during armed conflict could legally become property of the United States.
The mechanism was once commonplace in naval warfare but largely disappeared from American practice after the 19th century and has been dormant since World War II.
The appeal for the administration is largely practical.
At present, the government generally relies on civil forfeiture to take ownership of vessels accused of sanctions violations or other offenses.
Those cases can become complicated and slow, particularly when shipping companies, creditors, terrorism victims or other parties assert competing rights to the ship or its cargo.
A prize proceeding could potentially narrow those disputes and allow captured oil to be sold more quickly, with the proceeds going to the US Treasury.
Bloombergwritesthat Houston is being considered as a central venue for these cases.
The Southern District of Texas has jurisdiction over a major port and sits alongside the country’s largest concentration of petrochemical infrastructure, giving it the capacity to receive and store substantial quantities of crude.
US Attorney Aaron Reitz, whose office is working with DOJ officials in Washington, said the department is “now reviving” prize courts, describing the concept as an “ancient body of maritime law.” The effort comes as Washington looks for additional ways to put economic pressure on Iran.
US forces have already intercepted Iranian-owned or Iran-linked vessels since the blockade was imposed in April.
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