Documents considered by the Committee on Wednesday 23 March 2016 Contents

8Restrictive measures against North Korea

Summary and Committee’s conclusions

Committee’s assessment

Politically important

Committee’s decision

Cleared from scrutiny

Document details

(a) Council Decision amending Decision 2013/183/CFSP concerning restrictive measures against the Democratic People’s Republic of Korea; (b) Council Implementing Regulation amending Council Regulation (EC) No 329/2007 concerning restrictive measures against the Democratic People’s Republic of Korea

Legal base

(a) Article 29 TEU; unanimity; (b) Article 13 of Council Regulation (EC) No.329/2007, —

Department

Foreign and Commonwealth Office

Document Numbers

(a) (37568), —; (b) (37569), —

8.1The Democratic People’s Republic of Korea (DPRK) is currently subject to comprehensive sanctions measures imposed by the UN and EU. These measures include an asset freeze, travel ban and an extensive embargo which prohibits the export of arms, dual-use goods, and luxury goods and imposes restrictions on the export of other listed items that could contribute to nuclear or ballistic missile programmes (see “Background” for further details).

8.2The DPRK has continued in its attempt to circumvent these sanctions measures in order to support its nuclear, ballistic or other weapons of mass destruction related ambitions — most recently by “the nuclear test conducted on 6 January 2016 ‘in violation and flagrant disregard’ of the relevant resolutions, its actions thereby constituting a challenge to the Treaty on Non-Proliferation of Nuclear Weapons (NPT) and to peace and stability in the region and beyond”; and then by the “launch of 7 February 2016, using ballistic missile technology”. In response, on 4 March, the UN Security Council unanimously passed UN Security Council resolution 2270 (2016) (see paragraphs 8.19–8.20 below for details of the relevant UN statement).

8.3The UN statement sets out the detailed picture, which the BBC sums up thus:

The EU response

8.4On 4 March the EU issued the following statement:

“On 4 March 2016, the Council added 16 people and 12 entities to the list of targets subject to EU restrictive measures against the Democratic People’s Republic of Korea (DPRK).

The decision transposes the new listings imposed by United Nations Security Council Resolution 2270 adopted on 2 March 2016 in response to North Korea’s nuclear test and rocket launch on 6 January 2016 and 7 February 2016, respectively.

The legal acts will be published in the Official Journal on 5 March 2016.

EU restrictive measures against North Korea were introduced on 22 December 2006. The existing measures implement all UNSC resolutions adopted after the DPRK’s nuclear tests and launches using ballistic missile technology and also include additional EU autonomous measures. They target North Korea’s nuclear, WMD and ballistic missile programmes. The measures include prohibitions on the export and import of arms, goods and technology that could contribute to these programmes. Both the UN and the EU, autonomously, also imposed measures targeting financial services, trade and transport. The EU last strengthened its measures on 22 April 2013, transposing UNSC resolution 2094”.55

The Council Decision and Council Implementing Regulation

8.5The Minister for Europe (Mr David Lidington) explains that “transposition of the new UN sanctions measures to EU law will be complex”, and that the EU:

“has therefore taken the decision to transpose the new listings first, thereby mitigating the risk of asset flight, with the sectoral measures following at a slightly later date, once corresponding legal texts have been negotiated and agreed by all 28 EU Member States.”

8.6Thus, the Minister says, the Council Decision and Commission Implementing Regulation “implement the addition of 16 persons and 12 entities to the current list of persons and entities subject to sanctions measures, and the biographical amendments only”.

8.7The Minister notes that this was “the DPRK’s fourth nuclear test since 2006 and was in violation of a number of existing UN Security Council sanctions on the country”. He summarises the strengthened sanctions as “a range of measures” that:

“tackle proliferation networks; increase inspections of North Korean cargo and controls on shipping; adds new sectoral bans on the export of coal, iron ore, gold and other metals, and on the import of aviation fuel; requires the mandatory closing of North Korean financial sector entities and banks that we suspect could be contributing to the DPRK’s nuclear or ballistic missile programmes…[and] also designates additional North Korean individuals, entities, registered vessels, as well as certain luxury goods.”

8.8All in all, Minister notes, these “robust sanctions measures” strengthen the means of tackling North Korea’s illicit proliferation and its illegal nuclear programmes; constitute “a strong signal that the international community is prepared to take tough action in response to violations of UNSC resolutions”; will “severely disrupt DPRK’s ability to acquire the material it needs to support its nuclear and other WMD related programmes” and have “sent a very clear message that the DPRK’s actions pose a serious challenge to the Nuclear Non-Proliferation Treaty, as well as to international peace and stability, and will not be tolerated”.

8.9The US has also introduced these and further measures of its own; and, in recent days, the DPRK has both imprisoned a US student and carried out further ballistic missile tests (see “Background”). Annual US-South Korea military exercises are in prospect. Tensions are thus high. The EU is among those again calling on the DPRK “to refrain from actions that increase tensions in the region and threaten international peace and security”, in a statement that also says that it will “continue to closely monitor developments and coordinate with our partners on how to respond to these violations of UN Security Council Resolutions (see “Background” for details).

8.10When he submits the next iteration in this process, we should therefore be grateful if the Minister would provide a full outline and analysis of the wider political context (which is minimal in his present Explanatory Memorandum).

8.11In the meantime, we now clear this Council Regulation and Council Implementing Regulation from further scrutiny.

8.12In the circumstances and on this occasion, we do not take issue with the Minister having over-ridden scrutiny (see paragraph 8.23 below for details).

Full details of the documents

(a) Council Decision (CFSP) 2016/319 of 4 March 2016 amending Decision 2013/183/CFSP concerning restrictive measures against the Democratic People’s Republic of Korea: (37568), —; (b) Council Implementing Regulation (EU) 2016/315 of 4 March 2016 amending Council Regulation (EC) No 329/2007 concerning restrictive measures against the Democratic People’s Republic of Korea: (37569), —.

Background

8.13The EU and the DPRK established diplomatic relations in 2001, but political contacts had started earlier, with political dialogue on a relatively regular basis since 1998.56 However, according to the EU website: 

“The EU and the DPRK have very different views on issues that are of major concern to the international community, in particular on the DPRK’s weapons of mass destruction and ballistic missile-related programmes, human rights and regional relations… [and] [i]n this context, the EU has been robustly implementing the resolutions of the UN Security Council.”57

8.14In 2013, the EU further strengthened restrictive measures against the DPRK in view of nuclear and ballistic missile tests in December 2012, thereby giving effect to measures provided for in UNSCR 2087 (2013) and also including autonomous EU measures: it banned the export and import of key components for ballistic missiles with the DPRK, such as certain types of aluminium used in ballistic missile-related systems. The Council also prohibited trade in new public bonds from the DPRK. It outlawed trade in gold, precious metals and diamonds with North Korean public bodies and stopped the delivery of new DPRK denominated banknotes and coinage to the central bank of the DPRK. North Korean banks were no longer allowed to open new branches in the Union, nor establish joint ventures with European financial institutions. Nor were European banks permitted to establish offices and subsidiaries in the DPRK.58

8.15On 7 March 2013, the UN Security Council passed unanimously UNSCR 2094 (2013), strengthening and expanding the scope of UN sanctions against the DPRK by targeting the illicit activities of diplomatic personnel, transfers of bulk cash, and the country’s banking relationships, in response to a third nuclear test on 12 February 2013.59

8.16Subsequently, on 22 April 2013, the EU adopted Council Decision 2013/183/CFSP concerning restrictive measures against the DPRK. This legislation implemented the provisions as proscribed by UNSCRs 1718 (2006), 1874 (2009), 2087 (2013) and 2094 (2013), and implemented certain EU autonomous restrictive measures, including additional listings of individuals and entities.

8.17On 2 July 2015, via Council Decision (CFSP) 2015/10668, the EU added one entity and six persons to the list of persons and entities subject to restrictive measures in Annex II to Decision 2013/183/CFSP.60 The Minister for Europe explained that KNIC Gmbh — a subsidiary of KNIC headquarters based in Pyongyang — had been generating foreign exchange revenue within Europe; was linked to Office 39 of the Korean Workers Party, which had already been designated under EU sanctions; had therefore been sanctioned under the provisions in the EU sanctions regime directed against entities and individuals acting on behalf of, or at the direction of, an entity that had been sanctioned by the EU; and this action would prevent the DPRK from accessing a significant revenue stream, potentially slowing down the progress of its weapons programmes, and also demonstrate the EU’s commitment to properly implementing sanctions against the DPRK.

8.18Important as the overall measures themselves are, the Committee did not consider these additions, in and of themselves, of sufficient political and legal interest to warrant a substantive Report, and cleared them from further scrutiny accordingly.61

UN Security Council resolution 2270 (2016)

8.19On 2 March 2015, the UN Security Council issued the following statement:62

“The Security Council today condemned in the strongest terms the nuclear test conducted by the Democratic People’s Republic of Korea on 6 January 2016 “in violation and flagrant disregard” of the relevant resolutions, its actions thereby constituting a challenge to the Treaty on Non-Proliferation of Nuclear Weapons (NPT) and to peace and stability in the region and beyond.

Unanimously adopting resolution 2270 (2016), the 15-member Council also condemned the Democratic People’s Republic of Korea launch of 7 February 2016, using ballistic missile technology, and demanded that it comply immediately with its international obligations. Its previous actions on the subject included the adoption of resolutions 1718 (2006), 1874 (2009), 2087 (2013) and 2094 (2013).

By today’s resolution, the Council decided that all States should inspect cargo within or transiting through their territory — including airports, sea ports and free trade zones — that was destined for or originating from the Democratic People’s Republic of Korea. It also decided that Member States should prohibit that country’s nationals and those in their own territories from leasing or chartering their flagged vessels and aircraft to it, or providing it with crew services. The prohibition should apply also to any designated individuals or entities assisting in the evasion of sanctions or violation of all related resolutions.

The Council also decided that all States should prohibit their own nationals and others subject to their jurisdiction, as well as entities incorporated in their respective territories from registering vessels in the Democratic People’s Republic of Korea and obtaining authorization for vessels to use their respective flag. In addition, it decided that all States should deny permission for any aircraft to take off from, land at or overfly their respective territories if such aircraft contained items for supply, sale, transfer or export of which were prohibited by all related resolutions, except in cases of emergency landing.

Further by the text, the Council decided that Pyongyang should not supply, sell or transfer coal, iron, iron ore, gold, titanium ore, vanadium ore, and rare earth minerals, and that all States should prohibit their nationals from procuring such materials. By other terms, it decided that all States should prevent the sale or supply of aviation fuel — including aviation gasoline, naphtha-type jet fuel, kerosene-type jet fuel, and kerosene-type rocket fuel — whether or not originating in their own territory, to the Democratic People’s Republic of Korea.

By other terms, the Council decided that Member States should expel Pyongyang’s diplomats, governmental representatives or nationals acting in a governmental capacity who assisted in the evasion of sanctions or the violation of related resolutions. It decided further that all Member States should prevent specialized teaching or training of Democratic People’s Republic of Korea nationals within their territories, or by their nationals, in disciplines that could contribute to the proliferation of sensitive nuclear activities or the development of nuclear-weapon delivery systems.”

8.20 According to the UN statement, the UK Permanent Representative to the UN:

“noted that the resolution contained some of the toughest measures ever taken by the Council, adding that the Democratic People’s Republic of Korea had to be deterred from pursing illegal actions. However, the resolution was not intended to have adverse humanitarian consequences, nor to affect those activities not prohibited by Council resolutions, nor to affect international relief efforts, he emphasized, pointing out that the new provisions on cargo inspection were consistent with obligations set out in the Vienna Convention on Diplomatic Relations. Encouraging all States to implement the new resolution’s provisions in full, he urged Pyongyang to return to credible and authentic multilateral talks and permit full access by International Atomic Energy Agency (IAEA) inspectors.”

The Council Decision and the Council Implementing Regulation

8.21In his Explanatory Memorandum of 18 March 2016, the Minister explains that, as transposition of the new UN sanctions measures to EU law will be complex, the EU decided to transpose the new listings first, thereby mitigating the risk of asset flight, with the sectoral measures following, once corresponding legal texts have been negotiated and agreed by all 28 EU Member States.

The Government’s view

8.22The Minister says:

“These robust sanctions measures will severely disrupt DPRK’s ability to acquire the material it needs to support its nuclear and other WMD related programmes. The United Nations has also sent a very clear message that the DPRK’s actions pose a serious challenge to the Nuclear Non-Proliferation Treaty, as well as to international peace and stability, and will not be tolerated.”

The Minister’s letter of 18 March 2016

8.23The Minister notes that the EU adopted these measures on 4 March 2016, and says:

“The rapid transposition of UN sanctions designations into EU legislation is highly desirable in so far as it mitigates the risk of asset flight once designations have been published by the UN and ensures the effectiveness and credibility of the sanctions regime. I regret that I found myself in the position of having to agree to the adoption of these documents before your Committee had an opportunity to scrutinise them.”

Related developments

8.24On 17 March, according the BBC, US President Barack Obama issued an executive order imposing new sanctions on North Korea that freezes North Korean government property in America and bans US exports to, or investment in, North Korea, and also “greatly expands powers to blacklist anyone, including non-Americans, dealing with North Korea”; thus including both measures from the recently agreed UN Security Council sanctions and separate sanctions passed by Congress and enacted by the president on 19 February.63

8.25The following day, the BBC and others reported that North Korea test-fired two further ballistic missiles, which US officials described as medium-range, launched off the east coast and flying about 800km (500 miles) before falling into the water. The BBC notes that the DPRK also sentenced a US student to 15 years hard labour on 16 March for “severe crimes” against the state — he having been “arrested for trying to steal a propaganda sign from a hotel while on a visit in January”. The BBC also notes that the “US and South Korea are also holding their biggest annual military drills this month, which routinely generate tension”, and that “this year North Korea threatened to launch a “pre-emptive nuclear strike of justice” against the US and South Korea”.64

8.26On 18 March, the EU also issued the following statement:

“The reported launch of ballistic missiles by the Democratic People’s Republic of Korea (DPRK) is another clear violation of several United Nations Security Council Resolutions, including the latest one adopted on 2 March. We call again on the DPRK to refrain from actions that increase tensions in the region and threaten international peace and security. The DPRK must fully and rapidly comply with its international obligations, including by halting any launch using ballistic missile technology and abandoning its ballistic missile programmes in a complete, verifiable and irreversible manner. We will continue to closely monitor developments and coordinate with our partners on how to respond to these violations of UN Security Council Resolutions.”65

Previous Committee Reports

None.

57 See the EU Fact Sheet.

58 See Council reinforces EU sanctions against North Korea of 18 February 2013 for details.

60 The Korea National Insurance Company (KNIC) GmbH (alias Korea Foreign Insurance Company), its managing director and three members of staff, and two members of staff at the KNIC headquarters in Pyongyang.

61 See (36971) — and (36972) —: Third Report HC 342–iii (2015–16), chapter 45 (9 September 2015).

62 For the full text, which includes a number of subsequent statements by UN member state representatives and the text of UNSCR 2270 (2016), see Statement.

65 See statement.




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Prepared 30 March 2016