**There is no law in the US that bans high gas mileage cars**. In fact under Corporate Average Fuel Economy (CAFE) regulations manufacturers are fined for producing low gas mileage cars.
There are however regulations that place strict limits on the emissions produced by cars (note - Californian regulations but also used by many other states).
!LEV II Exhaust Mass Emission Standards
The emissions for the VW Passat 1.6 TDI sold in the UK are as follows (source):
!VOLKSWAGEN Passat Saloon 1.6 CR TDI
Converting the above data from mg/km to g/mi gives CO Emissions of 0.267 g/mi and NOx Emissions of 0.166 g/mi. **So the VW Passat 1.6 TDI can not be sold in any state using the Californian regulations as it emits too much NOx**.