The UN Security Council Sanctions Regime on the DPRK and Challenges for Implementation Stephanie Kleine-Ahlbrandt, DPRK Panel of Experts 2017 ASEAN Regional Forum (ARF) Inter-sessional Meeting (ISM) on Non-Proliferation and Disarmament (NPD) Auckland, New Zealand: 8-9 March 2017
Overview 1.UN Security Council Sanctions related to the DPRK 2.Expansion of UN sanctions regime through resolutions 2270 & 2321 (2016) 3.Panel of Experts 2017 Final Report findings 4.How do Member States Implement?
1. UN Security Council Sanctions related to the DPRK
DPRK Sanctions Regime Security Council Report Report Direct Panel of Experts 1718 Committee Assist/Report UN Member States, UN Bodies and Interested Parties
Goals of sanctions v to facilitate a peaceful and comprehensive solution v to persuade the DPRK to return to the Treaty on the Non- Proliferation of Nuclear Weapons (NPT) v to halt its nuclear weapons and ballistic missile programs by agreeing to the complete, verifiable, and irreversible denuclearization of the Korean Peninsula v Legal basis: Under Article 41 of Chapter 7 of the UN Charter , the Security Council may require all member states to implement measures short of the use of military force to give effect to its decisions Targeted measures are not intended to have adverse humanitarian consequences
DPRK Sanctions Regime UN Security Council Resolutions concerning the DPRK 30 November 2016 2 March 2016 S/RES/2321 (2016) 7 March 2013 S/RES/2270 (2016) S/RES/2094 (2013) 22 January 2013 S/RES/2087 (2013) 12 June 2009 S/RES/1874 (2009) 14 October 2006 S/RES/1718 (2006) UNSCRs concerning the Panel’s Mandate 24 March 2016 S/RES/2276 (2016) 4 March 2015 S/RES/2207 (2015) 5 March 2014 S/RES/2141 (2014) 7 March 2013 S/RES/2094 (2013) 12 June 2012 S/RES/2050 (2012) 10 June 2011 S/RES/1985 (2011) 7 June 2010 S/RES/1928 (2010)
DPRK Panel of Experts gather, examine and analyze information • Investigations: from States, relevant UN bodies and other interested parties, in particular on incidents of non-compliance; Recommendations : make recommendations on actions • which the Council, Committee or Member States may consider to improve implementation; Reporting : report to the 1718 Committee and the Security • Council (twice per year: midterm and final report); Outreach to Member States to explain sanctions measures • and encourage correct implementation; assist the 1718 Committee • Assistance to the Committee: in carrying out its mandate and functions;
DPRK Sanctions Regime 1. 2. 3. 4. Financial Commodity/ Interdiction and Arms sanctions and Sectoral bans Transportation embargo vigilance measures
2. Expansion of the UN sanctions regime through resolutions 2270 and 2321 (2016)
UN Resolution 2321 (2016) builds on 2270 (2016) 1. Imposes additional financial measures impacting the DPRK’s ability to access the international financial system for prohibited activities 2. Strengthens and expands sectoral sanctions on exports from the DPRK 3. Imposes new sanctions on the DPRK’s illicit transportation activities , including new mandatory inspection of cargo 4. Imposes other measures (aimed at non-proliferation) -
1. Expanded scope of targeted financial sanctions 1. Strengthened asset freeze: now also applies to economic resources owned or controlled by the Government of the DPRK, the Worker’s Party of Korea and any individual / entity working on their behalf or at their direction, with certain exemptions for DPRK diplomatic missions and other case-by-case exemptions 2. Scope of other targeted financial sanctions expanded by requiring States to i. close representative offices of designated entities and prohibit States’ participation in JVs or any other business arrangements with designated individuals and entities; and ii. expel non-nationals for working on behalf of or at the direction of designated individuals or entities.
2. New activity-based financial prohibitions and vigilance measures Require all States to expel individuals working on behalf of • DPRK banks or FIs; Require closure of foreign bank offices, accounts, and • subsidiaries in the DPRK; Require the expulsion of DPRK banking and financial officials • located outside the DPRK; Limit the number of bank accounts to one per DPRK • diplomatic mission and consular post, and one per accredited DPRK diplomat and consular office; Prohibit DPRK from using real property it owns or leases in a • State’s territory for any purpose other than diplomatic or consular activities; Prohibit all public and private support for trade with the DPRK • (such as export credits, guarantees and insurance).
3. Expanded sectoral sanctions • Prohibitions on trade of gold, titanium ore, vanadium, rare earth materials, coal, iron, iron ore, copper, nickel, silver and zinc, aviation fuel, as well as new helicopters and vessels; • Setting of a binding cap on DPRK coal exports and tightening conditions under that cap (the procurements may not involve any individuals or entities associated with the nuclear, ballistic missile, or other prohibited programs and activities).
4. Expanded transport restrictions 1. Prohibiting leasing, chartering or provision of crew services to the DPRK; 2. Mandatory inspection of all cargo destined for or originating from the DPRK (including personal luggage and checked baggage) 3. Prohibiting insurance and re-insurance services to DPRK vessels; 4. Prohibiting procurement of vessel or aircraft crewing services from the DPRK; 5. Requiring states to de-flag any vessel owned, controlled, or operated by the DPRK; 6. Introducing procedures for states to designate vessels based on reasonable grounds that they have been related to prohibited programmes or activities.
5. Other measures (proliferation) 1. Arms Embargo (binding conventional and WMD catch-all) a. Expanded list of prohibited dual-use items with WMD-related applications to include an additional 18 items; b. Created list of additional dual-use items that have conventional arms-related applications, to be prohibited for transfer to the DPRK. 2. Restricting scientific and technical cooperation involving the DPRK in certain sensitive fields 3. Exercising vigilance over the practice of DPRK nationals sent to work in other States to earn hard currency for the DPRK’s nuclear and ballistic missile programs as well as using bulk cash to evade sanctions 5. Restricting entry into, or transit through other States’ territories of DPRK government and military officials if they are associated with prohibited programs 6. Calls upon Member States to reduce the number of staff at DRPK diplomatic missions and consular posts
3. Panel of Experts 2017 Final Report
Panel of Experts 2017 Report Findings • In 2016, the DPRK engaged in: • Nuclear tests (2) and ballistic missile launches (some 20) • Trade in prohibited goods to a wide array of countries including in lucrative military technologies • Trade in banned minerals including by designated entities despite the new sectoral bans • More sophisticated sanctions evasion techniques • DPRK diplomats & embassies playing a key role in prohibited activities and cases of sanction evasion • While Member States have successfully blocked OMM vessels, other vessels are engaging in circumvention techniques (including through identity fraud) with the support of the DPRK maritime administration
Maritime transport of prohibited items aboard the Jie Shun
Panel of Experts Report Findings • DPRK banks (including designated banks) maintain correspondent bank accounts and representative offices abroad • DPRK banks operate abroad through front companies that are not registered as financial institutions but function as such • DPRK banks form partnerships with foreign companies • DPRK diplomatic missions provide support to network’s financial operations • The DPRK also uses bulk cash and gold to circumvent the formal financial sector.
Panel of Experts Report Findings • The networks behind this activity consist of a core of agents who are highly experienced and well trained in mobilizing money, people and goods, including arms and related materiel, across borders. • DPRK networks’ ability to conceal financial activity by using foreign nationals and entities allows them to continue to conduct financial transactions through top global financial centers including Hong Kong, New York and Singapore. • The business conducted by some of these networks generates significant revenue. Most of the financial activity investigated by the Panel was denominated in US dollars, euros and renminbi .
4. How do Member States implement?
Implementation Member States are required to supply information regarding any non-compliance with the sanctions measures and to submit national implementation reports in a timely manner. The 1718 Committee and the Panel will engage in outreach activities; to foster a better understanding of the DPRK sanctions regime; and to hold special meetings to address Member States’ capacity challenges The Committee will provide guidance to international organizations and States on how to proceed when implementing sanctions.
Member States implementation DPRK Panel of National Experts’ Implementation independent Reports (NIRs) investigations Reports on Information on inspection, non- seizure and compliance disposal
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