Memorandum from the UK Working Group on Arms[1]
A. BACKGROUND
1. The Export Control Act (ECA) 2002 and
the contingent secondary legislation are a considerable improvement
over the legislative framework they replaced, for example through
the introduction of new powers to control arms brokering and intangible
transfers of technology. However, three years on from its entry
into force, there are concerns that the new regime is struggling
to address the increasingly globalised nature of arms production
and the arms trade. It is clear there are a number of areas where
further change is necessary.
2. We are therefore asking for the following
to be considered:
— More parliamentary oversight of changes
to Guidance;
— Inclusion of sustainable development
in the table of Relevant Consequences contained in the Schedule
to the Act;
— An extension of the extraterritorial
controls on arms brokers;
— Greater controls placed on providers
of ancillary services, such as transportation and finance;
— More effective control on the transfer
of production capacity, be it through the establishment of licensed
production facilities, subsidiaries, joint-ventures or other means;
— Examination of possibility of developing
a military end-use catch-all clause;
— Further extension of end-use controls
to prevent undesirable activities such as torture and terrorist
acts;
— Clarification and tightening of rules
governing transit and transhipment;
— Stricter controls on government-to-government
transfers;
— Greater specificity regarding transparency
and reporting obligations;
— Introduction of post-export controls;
— An increase in resources for and
more strenuous efforts in terms of implementation and enforcement.
3. While the UK Working Group on Arms (UKWG)
is anxious to provide as much detail as possible regarding the
shortfalls in the current system and ideas for how to address
them, it should be noted that the formal review process is not
due to commence until May 2007. With this timeline in mind,
the UKWG is still formulating its proposals for amendments to
the existing legislation, and the submission that follows should
therefore be regarded as a work in progress. It is the intention
of the UKWG that as we approach the review proper, the ideas contained
herein will be refined. On this basis, the UKWG will be happy
to provide supplementary memoranda to the Committee in the months
to come.
4. The UKWG notes that the terms of reference
for the review provided by the Export Control Organisation focus
on reviewing the control orders issued under the enabling ECA,
rather than the primary legislation per se. While this
may be a useful place to start the review, the UKWG believes that
where an examination of the control orders point to a problem
with the primary legislation, this too should be addressed by
the review. Similarly, the review process should not shy away
from recommending changes to the primary legislation where weaknesses
are identified which fall outside the scope of the existing ECA.
5. Included in this submission are certain
recommendations for changes at the level of secondary legislation
which the Government may argue can be accommodated without reference
to the control orders, for example regarding post-export controls.
However, the UKWG believes that in some circumstances there is
value in setting out minimum standards in the control orders,
so as to underline and clarify the Government's commitments to
certain principles.
6. There is an additional external factor
that the review should take into account. EU member states have
at the technical level agreed a draft Common Position Defining
Common Rules Governing the Control of Exports of Military Technology
and Equipment which will, when formally adopted, replace the EU
Code of Conduct on Arms Exports. National legislation in the member
states will then be required to be compliant with the new Common
Position. There is no dispute among EU member states regarding
the content of the draft Common Position. It would therefore be
sensible for the Government to use the review as an opportunity
to adapt the Act and relevant control orders to ensure this compliance.
B. GUIDANCE
7. At the level of the Export Control Act,
the UKWG recalls the debates which took place in 2001 and 2002
around the powers of the Secretary of State of Trade and Industry
to issue Guidance (section 9). The concern was raised that the
legislation gave the Secretary of State excessive discretion to
change the guidance and that Parliament's role in this process
was unduly limited, ie Parliament would merely be informed of
the guidance, potentially retrospectively. Critics were informed,
however, that the Government would exercise this power with care,
and that significant changes to the guidance would not be introduced
without due consideration being paid to the concerns of Parliament.
8. On 8 July 2002, the Government announced
that new guidance had been given on the subject of considering
applications for export licences for the supply of military equipment
for incorporation into final products for possible onward export.
In the same announcement, it was revealed that export licenses
had already been issued under this licence, specifically for the
export of Heads-Up-Display Units for use in the cockpits of F-16
aircraft to the US, for onward export to Israel.[2]
This would appear to have confirmed the fears of those opposed
to the way section 9 of the Export Control Act was formulated.
The UKWG recommends that the Government revisits this part of
the Act so as to limit the power of the Secretary of State to
make changes to guidance without independent oversight.
C. SUSTAINABLE
DEVELOPMENT
9. Another issue relating to section 9 of
the primary legislation relates to sustainable development. Excessive
or inappropriate arms purchases are a drain on social and economic
resources that developing countries cannot afford. To this end
the inclusion of sustainable development in the Export Control
Act of 2002 was a welcome recognition of the fundamental importance
of the issue. However, the UKWG has concerns with the way that
sustainable development has been included in the ECA.
10. First, despite the best efforts of NGOs,
the criterion on sustainable development was omitted from the
table of "Relevant consequences" contained in the Schedule
to the Export Control Act, thereby giving the sense they are of
secondary importance. Second, the inclusion of the bracketed phrase
"if any" in the reference to sustainable development
in section 9 (guidance) of the Act, whereby "[t]he guidance
required . . . must include guidance about the consideration (if
any) to be given, when exercising such powers, to . . . issues
relating to sustainable development" is unwelcome. It allows
the Secretary of State excessive discretion to remove sustainable
development from the licence decision-making process, and consigns
the issue to second-class status, thus further undermining the
importance of this issue.
11. Sustainable development should be included
in the table of Relevant Consequences contained in the Schedule
to the Act in order that this criterion has equivalence with other
consequences, and is treated in a way that is commensurate with
the damaging affects of transfers that undermine development.
D. CONTROLLING
ARMS BROKERS
12. The UKWG maintains that exterritorial
controls on UK arms brokers should be the rule rather than the
exception. Therefore, rather than structuring the control orders
so that extraterritorial control of UK arms brokers is limited
to a few special categories of goods or destinations, the Government
should honour its manifesto pledge and start from the premise
that all arms brokering activities of UK passport-holders should
be controlled, wherever they are located.
13. However, with regard to the nature of
the extraterritorial controls, there may be a case for classifying
certain types of equipment which although sensitive have legitimate
uses (eg unmanned aerial vehicles—UAVs) as separate from
other goods which can never be classed as legitimate (eg torture
equipment). Consideration has been given to the possibility that
for items which fall into the former classification a distinct
category of goods could be created within the Trade in Goods (Control)
Order. For these goods, ie equipment which is particularly sensitive
but for which legitimate uses exist, extraterritorial controls
would still apply, but no licence would be required for activities
such as general advertising or promotion. This would, for example,
avoid the need for defence publications to obtain licences to
carry advertisements for UAVs. SALW would logically fall into
this category. The UKWG is interested to engage in this debate
in a constructive manner, however any steps in this direction
must be very carefully thought through to ensure that they do
not have a negative impact on the general standards of transfer
controls in the UK.
14. The UKWG continues to see registration
as a valuable additional tool in the battle against irresponsible
arms brokers. This position would seem to be reflected in the
EU Common Position, which encourages member states to have a system
of registration in addition to case-by-case licensing of individual
transactions. The arguments advanced by the Government against
registration (ie it suggests active support of those registered
and it introduces an additional and unwelcome level of complexity
to the system) seem inconsistent with its general approach to
registration in other fields (eg financial services, the medical
profession).
15. As another way of enhancing existing
controls on arms brokers, registration would provide a useful
entry point for ensuring that brokers have a good knowledge of
the law (this could be one of the criteria for being admitted
to the register) and related to this would assist in dissemination
of information regarding changes to control lists, open licences,
embargoed destinations etc. The ability to refuse entry to or
to strike off from the register is very useful in terms of sending
a signal to governments with whom the UK is willing to exchange
such information. This would also have value in terms of alerting
other brokers, defence manufacturers, transporters, freight-forwarders
and the financial and insurance industries that they should be
extremely cautious in their dealings with intermediaries who are
not on the register.
E. CONTROLLING
ANCILLARY SERVICES
16. There is an urgent need to bring those
involved in the transportation or financing of the defence transfers
more into the transfer control process. There are several reasons
for this. As more jurisdictions introduce controls on arms traffickers,
brokers are tending to "reinvent" themselves as transporters,
and thereby to once more step beyond the law. These brokers are
typically adept at creating vastly complicated deal structures
involving myriad participants, whereby isolating brokering responsibilities
becomes increasingly difficult for authorities. Regulating the
activities of the transporters would help to address this problem.
Furthermore, tracing transportation is more straightforward than
tracing brokering paperwork. There is also the possibility of
seizing the means of transportation, which would create an incentive
for those who would stand to lose their plane or vessel to ensure
that they were not involved in an illicit transfer.
17. Tighter regulation of the transportation
and financial industries would also provide an opportunity to
alert manufacturers who are in breach of transfer controls through
ignorance or laziness of their obligations. Creating obligations
for these types of business, for whom dealing with regulatory
and administrative regimes is fundamental but for whom any single
shipment would be peripheral, could be away of enlisting them
as allies in the battle to reduce the incidence of licensable
trades that are taking place without licences being applied for.
The number of companies likely to be involved in these supporting
activities is likely to be substantially fewer than the number
of manufacturing companies that should be but are not observing
transfer control rules, so they are thus a potential point of
leverage. By creating obligations on transporters and freight
forwarders and on financial and insurance companies, and then
providing for serious penalties in the event that these intermediaries
do not fulfil those obligations as well as arranging for periodic
compliance visits, this may be an effective way of bringing a
greater number of inadvertent law-breakers within the transfer
control-conscious community.
F. GLOBALISATION
OF PRODUCTION—CHALLENGES
OF CONTROL
18. Last year, the UKWG highlighted a number
of cases which clearly demonstrate the particular challenges thrown
up by the globalisation of arms production. These relate to issues
of licensed production or other joint venture agreements resulting
in offshore manufacture of defence goods; the role of foreign
subsidiaries; and the related issues of non-listed dual-use components
utilised in military production for which no license is required—often
referred to as NLR (no licence required items) or COTS (civilian
off-the-shelf technologies). We are pleased that the Government,
in light of such evidence, is looking again at the legislation
and associated control systems to see whether such aspects can
be brought more fully within the transfer control system. The
UKWG accepts these are challenging and complicated areas, nevertheless
if the purpose of the transfer control system is to prevent the
supply of arms to where they can be misused, it is incumbent on
the control systems to attempt to meet these challenges.
19. Licensed production overseas
The role of Turkish -supplied and -built Landrover
Defender vehicles in the Andijan massacre in May 2005 graphically
demonstrates the particular challenges thrown up by inadequately
regulated licensed production agreements. It is very unlikely
that Landrover Defender vehicles to this specification would have
been licensed for direct export to Uzbekistan from the UK. It
seems that the current practice of only licensing the technology
associated with production or specific military components supplied
as a result of the deal is not sufficient to regulate such re-exports.
Controls need to be applied to the licensed production agreement
itself, placing clear and binding contractual obligations on production
ceilings and permitted export markets. Production or export over
and above terms specified in the original licensed production
agreement should require an additional licence from the UK. Such
a system already operates in the US and the recent production
agreement to produce Kalashnikov rifles in Venezuela under licence
from Russia also contains limits on production and tight restrictions
on exports. If Russia and US can do it, why not the UK?
20. Overseas subsidiary companies
The issue of foreign subsidiary companies also
presents a challenge for the UK export control system, not least
because subsidiaries are operating within the legal frameworks
of the countries where they are based. However, the case of Askok
Leyland and its negotiations to supply military trucks to Sudan
announced at IDEX defence exhibition in February 2005 shows the
pitfalls of not applying controls to overseas subsidiaries. The
supply of such vehicles would be illegal from the UK under the
current EU embargo legislation, but this does not apply to subsidiaries
of UK companies. Other examples presented last year show how subsidiaries
of UK companies can supply military vehicles to a range of destinations
where it would be highly unlikely that an export license would
have been approved if the equipment had been sourced direct from
the UK. While clearly a complex legal area, at the very minimum,
embargo legislation should be amended to include transfers from
subsidiary companies. If it would be illegal to supply the equipment
from the UK, it is clearly a loophole to allow UK-owned companies
to bypass embargo legislation via the activities of their overseas
subsidiaries.
21. The UKWG would also urge the Government
to look again at whether re-export controls can be applied in
these cases. It is clear that overseas subsidiary companies have
and are likely to continue to supply military equipment to a variety
of destinations in cases where the UK parent would not receive
an export licence to export similar equipment directly from the
UK.
G. DUAL-USE
ITEMS FOR
INCORPORATION INTO
MILITARY SYSTEMS
22. In January 2006, a US Predator unmanned
aerial vehicle (UAV) reportedly fired a Hellfire missile seven
kilometres across the Afghan border into Pakistan. Eighteen local
villagers, alongside four suspected al-Qaeda members were killed.[3]
The Pakistan government protested to the US over the violation
of its territory, and the deaths of civilians. But others have
also questioned the legality of such unlawful killings. A similar
Predator attack in 2002 killed six men reported to be al-Qaeda
members in Yemen. Amnesty International concluded that, because
"the US authorities deliberately decided to kill, rather
than attempt to arrest these men, their killing would amount to
extra-judicial executions."[4]
The Predator is manufactured in the US by General Atomics Aeronautical
Systems, but contains key electronic computer systems manufactured
by UK-based Radstone Technology. Radstone's Managing Director,
Charles Peterson, has said, "the Predator wouldn't fly without
Radstone technology."[5]
23. It appears the Department of Trade &
Industry has classified the "electronic" brain of the
Predator UAV as COTS technology, and thus not a licensable product
(so not subject to export controls), despite the fact that the
end product (a UAV) is subject to some of the most restrictive
controls under the Act.
24. A similar problem exists with the Landrover
parts exported to Turkey making up the vehicles used in the Andijan
massacre. As the components (which comprised approximately 70%
of the finished military vehicle) were not specifically adapted
military components, they were classified as NLR, notwithstanding
the fact that they are clearly sold as military vehicle kits.
25. Given the trends towards globalisation
and the increasing importance of dual-use and COTS goods in the
development of modern weapons systems, it would appear that more
and more goods critical to the operation of these systems will
bypass the licensing system as they do not fall within the definitions
or specification of the control lists.
26. One way to regulate this trade is to
expand the concept of military end-use catch-all clauses to capture
such goods and technologies. Any such system must clearly be able
to differentiate between "mission critical" components
and mundane goods like nuts and washers, wiper blades and fan
belts. This is not without its complications. However, it must
be possible to develop either threshold systems (as happens in
the US) or significance criteria for the role of the component
in the finished item. For example, it should be possible to create
a military end-use catch all that covers significant items such
as vehicle chassis, engines, transmission systems, or components
used for weapons management, navigation or guidance systems.
H. EXTENDED USE
OF END-USE
OR CATCH-ALL
CONTROLS TO
PREVENT "UNDESIRABLE
ACTIVITY"
27. Where the Government has determined
that the UK should never be involved in supplying equipment in
support of specified activities, it should use end-use controls
to avoid the loophole whereby items not included on control lists
are beyond regulatory reach. While a system of controlling goods
contained within specific military and dual-use lists is the cornerstone
of many export control systems, the ultimate purpose of export
controls is to prevent certain types of activity or consequences.
The challenges posed by technological advancement, the development
of new products and the adaptability of certain dual-use goods
and technologies all pose problems for a system that operates
purely on the basis that only what is on the list gets controlled.
28. Catch-all clauses exist with regard
to chemical, biological or nuclear weapons programmes and regarding
military end-use to embargoed destinations. Most stakeholders
appear to see value in extending this approach to items which
will be used in torture, degrading treatment or executions, or
in connection with terrorist acts.[6]
29. The purpose of such a clause would be
to state that "if" the exporter is aware, or ought to
be aware, that the intended use of items is to facilitate such
prohibited acts, irrespective of whether the item was on a control
list, the transfer would be prohibited without the express permission
of the Government in the form of an export licence. It should
be noted that while acts of terrorism and international crime
and the development of WMD are included in the relevant consequences
section of the 2002 Export Control Act, the facilitation of torture
or other forms of cruel or degrading treatment are not. It is
clear that such acts do fall within the definitions of internal
repression and human rights violations, but it would seem sensible
at this juncture to update the primary legislation to specifically
include acts of torture under the relevant consequences section
to bring the Act in line with existing UK Government and EU policy
in this area.
30. It would seem that competence to institute
such controls rests with the European Commission rather than EU
member states, and so it may not be feasible to introduce these
changes directly upon conclusion of this review. However, the
review could make recommendations to this effect that can then
be carried forward in discussions with EU partners with a view
to extending catch-all provisions.
I. CLARIFICATION
OF THE
RULES ON
TRANSIT/TRANSHIPMENT
31. The issue of transhipment and transit
became a focal point during the conflict in Lebanon in August
2006, when it emerged that US aircraft containing munitions bound
for Israel for probable use in Lebanon had transited through the
UK.[7]
It is highly unlikely, given the clear risks that such munitions
would be used in indiscriminate and disproportionate attacks in
and around civilian areas, that the UK government would have authorised
such transfers from the UK.
32. The current licensing requirements regarding
transit and transhipment of controlled goods are extremely confusing,
to the point where industry itself is not clear as to its obligations.
Even the use of the terms "transit" and "transhipment"
is confusing, and may not tally with usage by the World Customs
Organisation, of which the UK is a member.
33. As things stand, it would seem that
the standard approach of industry (apart from where the goods
concerned are of a particularly sensitive nature, eg when the
goods are anti-personnel landmines or may be subject to end-use
control) is to assume that possible regulatory obligations relating
to a transit or transhipment can be ignored, as in most circumstances:
— a licence will most probably not
be required;
— if a licence is required, it will
most probably be the Open General Transhipment Licence, for the
use of which registration is not required and no records need
be kept, so it is in effect irrelevant;
— in the event that the Government
decided that other authorisation should have been sought, the
confusion surrounding the rules would make it virtually impossible
to have any realistic expectation of a successful prosecution.
34. The Export Control Act suggests that
most transit and transhipment via the UK is permitted as long
as certain conditions are met, yet it fails to specify what these
conditions are. The Open General Transhipment Licence (OGTL) currently
available for use seems to contradict this. For most items on
the military list, the OGTL lists a variety of destinations in
an annexed Schedule for which individual approval is required.
This implies that for sensitive destinations listed on the Schedule,
a licence is required in advance to bring these goods through
the UK. Since the UK is a major transportation hub and there is
confusion amongst all relevant parties (including exporters themselves),
amendments to the legislation and/or clear guidance on the rules
and procedures for transit should be prioritised.
J. GOVERNMENT-TO-GOVERNMENT
TRANSFERS
35. The Government should apply and should
be seen to apply the same transfer criteria when involved as a
principal in a strategic transfer. However, currently, the Government
is not obliged when involved as a principal in an arms transfer
to apply the licensing process as it would for a sale by a defence
manufacturing or trading company. Section 7 of the Export Control
Act states that an order under the Act "may make provision
binding the Crown" (emphasis added). However, our understanding
is that this power was established to ensure the UK can comply
with international legal commitments, for example EU Dual-Use
regulations. Where only national laws apply, the Government has
not used this power.
36. The Government sought to justify this
approach during the House of Commons Committee Stage hearings
on the Bill. Nigel Griffiths, the then Trade and Industry Minister
in charge of the Bill, stated:
Our exports (ie Government to Government transfers)
tend to be items of essential equipment used by our armed forces
or in connection with important international collaborative defence
projects such as peacekeeping and projects in Kosovo and Macedonia.
Items are also exported for international development purposes
such as mine clearance.[8]
37. The UKWG acknowledged this argument
at the time, and proposed that the power to bind the Crown could
be subject to certain exceptions, but maintained and still maintains
that there are many circumstances where the Crown must be bound,
eg government-to-government sales, disposal sales and gifts, and
for which a strict application of the Consolidated Criteria is
essential. Most obvious of these have been the Al Yamamah contracts
for sales to Saudi Arabia, which are now in the process of being
supplemented by the sale of a further 72 "Typhoon" aircraft.
Other government-to-government transfers of note include the transfer
of 226 Challenger battle tanks to Jordan between 2002 and 2004,
and the gifting to Nepal of two Mi17 helicopters in 2002 and of
two STOL aircraft in 2004.
38. We are told that the Government does
in effect apply the same standards to government-to-government
transfers as to commercial transactions, in which case we can
see no reason why it refuses to allow the use of the same formal
process. Changing the legislation so that it must bind
the Crown (allowing for some exceptions) would simply guarantee
that, at both the contract-negotiation stage and in terms of public
and parliamentary scrutiny, the same standards are and will continue
to be applied across the board (the current arrangement is at
the sufferance of the Government and it would seem to be subject
to change on a governmental whim). With regard to transparency,
reporting on commercial transfers, which is centred on licences
(both awarded and refused), is more revealing of government policy
than reporting on government dealings. The specific information
contained in the annual reports on government-to government transfers
relates only to physical transfers, not to the amount that the
Government was willing to transfer or to deals the Government
refused.
39. The Scott Report recommended the list
of international organisations and Crown agencies exempt from
export controls should be abolished, while in its 2001 report
on the draft Bill the Quadripartite Committee suggested that "consideration
be given to the desirability of ending the blanket exemption from
controls of Government and its agencies as exporters of licensable
goods and technology".[9]
The UKWG believes that the original arguments raised before the
Export Control Act was passed retain their validity, and the Government
should move to amend the legislation accordingly.
K. ANNUAL REPORTING
AND TRANSPARENCY
40. The UKWG is aware that the Government
does not wish to include reporting and transparency within the
review process. However UKWG believes it is a weakness of the
current legislation that the Act contains only a simple requirement
for the Secretary of State to produce "a report on . . .
matters [other than the export of objects of cultural interest]
relating to the operation of the Act (and any order made under
it) during the year" (section 10).
41. The Government has repeatedly claimed
that the information contained in its Annual Reports on Strategic
Export Controls has made the UK's export control system one of
the most transparent in the world. While the current system is
undoubtedly an improvement on the information provided by previous
administrations and contains data not previously in the public
domain, data is not equivalent to information.
42. For effective parliamentary and public
scrutiny to take place in this area, information covering all
forms of UK transfers is required and the information needs to
be current, precise, and comprehensive. The Annual Reports still
contain significant omissions. The Scott Report still stands testament
to the dangers of a culture of secrecy:
"Without the provision of full information
it is not possible for parliament, or for that matter the public,
to assess what consequences, in the form of attribution of responsibility
or blame, ought to follow. A denial of information to the public
denies the public the ability to make an informed judgement on
the Government's record. A failure by Ministers to meet the
obligations of Ministerial accountability by providing information
on their departments undermines, in my opinion, the democratic
process." [Scott K8.3; emphasis added]
43. The UKWG urges the Select Committee
to encourage the Government to consider the issues of public reporting
and transparency as part of the review process.
L. POST-TRANSFER
CONTROLS
44. The Government has long maintained that
there is no substitute for a rigorous assessment of any proposed
export at the time of application, and has argued that "the
introduction of a process that allows for the issue of licenses
based on future end use monitoring militates against the effective
application of the criteria at the licensing stage."[10]
The Government also states that "[i]t is not the case that
the Government issues licences where it has identified some degree
of risk: if the issue of a licence is assessed to be inconsistent
with the Consolidated Criteria then it will not be granted."[11]
45. The UKWG strenuously disagrees with
this assertion. The UKWG fully appreciates that these are sometimes
complicated judgements, and therefore welcomes the Government's
commitment to thorough pre-licensing assessments. However, there
is always some risk that equipment or technology exported
will be misused or diverted, even when it stays in UK hands (eg
there have been recent reports of UK soldiers smuggling guns out
of Iraq to be sold in the UK[12]).
The task of the Government is to assess the level of risk;
the licensing process by its very nature means that there will
be marginal cases where difficult decisions have to be made. It
therefore remains incumbent upon the Government to mitigate the
effects of possible errors of judgement or higher risks.
46. The additional procedures that the UKWG
is calling for are:
— specific restrictions to be included
in the contract and/or the licence on use or retransfer, for example
the prohibition of re-export without permission;
— the licence and/or contract to state
that the UK Government reserves the right to conduct end-use checks;
— the licence to make clear what the
implications of breaching end-use undertakings would involve,
ie that all licences connected to the equipment or technology
in question would be revoked, and that future licensing decisions
would take any breaches into account (the Government may claim
that breaches are already treated in this way, in which case it
is not clear what objection they would have to making these consequences
clearly understood on the licence).
47. This would not be a substitute
for rigorous pre-licensing assessments, it would involve additional
measures. Nor should it be seen as an opportunity to redraw the
margins between awarding and refusing licences so that a less
stringent pre-licensing test is applied, but as an additional
safeguard.
48. An example of the benefit of making
these conditions explicit in advance of a transfer can be seen
in connection with a recent decision by the Indian Government
to sell Islander maritime-patrol aircraft, originally supplied
by the UK, to Burma/Myanmar. It is reported that the UK Government
has made representations to the Indian Government opposing the
transfer, but according to The Hindu, the Indian Defence
Ministry feels that the curb is unfair in the absence of a resale
clause in the contract. An unnamed senior naval officer is quoted
as saying "we should tell [the UK] where to get off."[13]
M. IMPLEMENTATION
AND ENFORCEMENT
49. While this is not an issue that necessarily
requires legislative change, it is critical to the effectiveness
of the Act and the contingent control orders. The UKWG has serious
concerns that not enough resources are being allocated to the
implementation of the existing regime. On a number of occasions
where there has been evidence of breaches of controls, the response
of Government has been inadequate.
50. In terms of resources, there are several
issues that give us cause for concern, such as:
— cuts in staff numbers at the Export
Control Organisation;
— the failure to include arms transfers
among the subjects listed on the "Customs Confidential"
website until alerted by the Quadripartite Committee;
— the possible lack of capacity and
inclination of HMRC to deal with transfer control issues (as according
to the evidence provided by the defence industry to the Quadripartite
Committee in January 2006[14]).
51. The UKWG also has significant concerns
regarding a possible lack of inclination to enforce the controls
where evidence comes to light that companies or individuals may
be in breach. There have been some prosecutions under the Act,
but these have for the most part been for relatively minor and
on occasion procedural offences, and subject to minimal penalty.
The most significant prosecution was in relation to systematic
efforts by the company Multicore to procure and smuggle components
for the Iranian military, yet the punishment was limited to one
individual receiving an 18 months' prison sentence suspended for
two years, a ban from being a company director for 10 years, and
an order for seizure of assets of approximately £70,000.[15]
52. In addition, there are cases where the
authorities have failed to launch or even pursue prosecutions
when there would appear to be strong grounds for doing so. For
example, evidence has previously been provided to the Committee
by Mark Thomas regarding the promotion of torture equipment at
the DSEi arms fair in 2005 and on the websites of UK-based companies.[16]
When these cases were brought to the attention of the authorities,
the offending stands were closed down and the information on the
websites was removed, but to the knowledge of the UKWG no efforts
were made to bring forward prosecutions.
53. In written evidence presented by the
UKWG to the Committee in January 2006, two cases were referred
to whereby:
— a UK newspaper reported that it had
obtained documents showing that arms brokers based in the United
Kingdom had been involved in negotiations for arms deals to supply
£2.25 million worth of arms to Sudan; and
— Amnesty International documented
the role of three British-based companies involved in the supply
of over 240 metric tonnes of arms and ammunition from Albania
to Rwanda for onward shipment to armed opposition groups in the
eastern DRC.[17]
54. In both instances it seemed there was
a strong prima facie case meriting serious investigation
by the authorities. To the knowledge of the UKWG, no serious investigation
ensued.
55. There has been a suggestion that the
preferred response of the Government to cases of this type is
to work behind the scenes to ensure that the trade does not take
place. While this is useful in its own right, the UKWG contends
that it is an insufficient response.
56. For anybody making a risk-reward calculation,
the clear message is that the downside to participating in such
activity is minimal, and thus the legislation is undermined.
November 2006
1 For the purpose of this submission, the UK Working
Group on Arms comprises Amnesty UK, BASIC, Oxfam GB and Saferworld. Back
2
Hansard, 8 July 2002, col 650W. Back
3
"Pakistan rally against US strike", BBC News,
15 January 2006, http://news.bbc.co.uk/go/pr/fr/-/1/hi/world/south_asia/4614486.stm;
and "Pakistan probes al-Qaeda deaths", BBC News,
19 January 2006, http://news.bbc.co.uk/go/pr/fr/-/1/hi/world/south_asia/4626684.stm. Back
4
"The Threat of a Bad Example-undermining international standards
as `war on terror' detentions continue", Amnesty International,
AI Index: AMR51/114/2003. Back
5
"CIA's Killer Drone Livens Profits", Birmingham
Post, 7 November 2002. Back
6
The term "terrorist attacks" should be understood generally
in this context to mean acts which are prohibited under international
law, such as deliberate attacks on civilians, indiscriminate attacks,
hostage taking, torture or deliberate and arbitrary killings,
when the purpose of such an act, by its nature or context, is
to intimidate a population or to compel a Government or an international
organization to do or to abstain from doing any act. There are
some continuing disagreements around the use and definition of
the term "terrorism", particularly regarding the question
of intent and whether states can commit acts of terrorism. Back
7
"Airport curb on US "bomb flights'," BBC News,
1 August 2006, http://news.bbc.co.uk/1/hi/uk_politics/5235192.stm. Back
8
House of Commons, Standing Committee B, 16 October 2001 (afternoon
session), column 130, http://www.publications.parliament.uk/pa/cm200102/cmstand/b/st011016/pm/11016s03.htm. Back
9
Quadripartite Select Committee's Joint Report on the "Draft
Export Control and Non-Proliferation Bill 2001", 1 May 2001,
para. 53, http://www.parliament.the-stationery-office.co.uk/pa/cm200001/cmselect/cmdfence/445/44508.htm. Back
10
Response of the Secretaries of State for Defence, Foreign and
Commonwealth Affairs, InternationalDevelopment and Trade and Industry
to the Report from the Quadripartite Committee on Strategic Export
Controls: HMG's Annual Report for 2004, Quarterly Reports for
2005, Licensing Policy and Parliamentary Scrutiny, October 2006,
Cm 6954, para. 40, http://www.official-documents.gov.uk/document/cm69/6954/6954.pdf. Back
11
Ibid. Back
12
Daniel McGrory and Dominic Kennedy, "Troops accused of gun-running
for cocaine and cash," The Times, 13 October 2006,
http://www.timesonline.co.uk/article/0,,29389-2401628.html. Back
13
Sandeep Dikshit, "Curbs apply only to aircraft spares: UK,"
The Hindu, 4 February 2006, http://www.hindu.com/2006/02/04/stories/2006020403311300.htm. Back
14
Minutes of oral evidence to the Quadripartite Committee, 31 January
2006, qu 32-50, http://www.publications.parliament.uk/pa/cm200506/cmselect/cmquad/873/6013101.htm. Back
15
As previously detailed in the First joint Report of the Quadripartite
Committee, Strategic Export Controls: Annual Report for 2004,
Quarterly Reports for 2005, Licensing Policy and Parliamentary
Scrutiny, HC 873, 3 August 2006, paras 120-122, http://www.publications.parliament.uk/pa/cm200506/cmselect/cmquad/873/87308.htm. Back
16
Ibid. Back
17
Memorandum from the UKWG on Arms to the Quadripartite Committee,
January 2006, http://www.publications.parliament.uk/pa/cm200506/cmselect/cmquad/873/873we07.htm. Back
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