ITALY SAYS IRAN MAY REALLY NEED SPEED BOATS

C O N F I D E N T I A L ROME 002257 SIPDIS NP/ECNP, NP/ECS, NEA/NGA, EUR/PRA, EUR/WE E.O. 12958: DECL: 05/09/2012 TAGS: PREL PARM ETTC IR IT UN EXPORT CONTROLS SUBJECT: ITALY SAYS IRAN MAY REALLY NEED SPEED BOATS CONFIDENTIAL PAGE 02 ROME 02257 091415Z REF: STATE 64844 CLASSIFIED BY: CLASSIFIED BY ECOUNS KAREN MILLIKEN; REASON 1.5 B/D. ¶1. (C) ACTION REQUEST AND SUMMARY. ITALY WILL INVESTIGATE REFTEL POTENTIAL SALE OF HIGH-SPEED BOATS TO IRAN BUT, AT LEAST PRELIMINARILY, DOES NOT NECESSARILY AGREE THAT THE SALES WOULD EITHER VIOLATE ITALIAN LAW OR WOULD COME WITHIN THE PURVIEW OF WASSENAAR'S MUNITIONS LIST. MFA'S NONPROLIFERATION COORDINATOR SAYS THAT ITALY WOULD NOT ALLOW THE SALES IF IT FOUND THE BOATS TO BE WARSHIPS. ON THE OTHER HAND, HE SAID, IRAN HAS A LOT OF COAST TO PATROL AND SOME NEIGHBORS WHO NEED WATCHING. SEE ACTION REQUEST PARA 4. END ACTION REQUEST AND SUMMARY. ¶2. (C) THE GOI WILL INVESTIGATE REFTEL'S POTENTIAL BOAT AND BOAT ENGINE SALES TO IRAN IN THE CONTEXT OF APPLICABLE NONPROLIFERATION OBLIGATIONS AND INTERESTS, MFA'S NONPROLIFERATION COORDINATOR UGO DE MOHR TOLD ECONOFF ON MAY ¶8. DE MOHR EXPLAINED THAT ITALY, NOTWITHSTANDING ITS VAST TRADE RELATIONS WITH IRAN, STEADFASTLY EMBARGOES SALES TO IRAN OF WEAPONS AND SENSITIVE DUAL USE GOODS AND TECHNOLOGIES. REVIEWING REFTEL TALKING POINTS, HOWEVER, HE SAID HE COULD NOT AGREE THAT THE SALES WOULD NECESSARILY EITHER VIOLATE ITALIAN LAW OR REQUIRE ACTIVATION OF THE WASSENAAR PROCESS. ¶3. (C) DE MOHR SAID THAT ITALIAN LAW REQUIRES A WEAPONS/ SENSITIVE DUAL USE EMBARGO AGAINST IRAN UNDER "CATCH HUMAN RIGHTS" PROVISIONS UNTIL IRAN COMPLIES WITH APPLICABLE UNITED NATIONS RESOLUTIONS BUT ADDED, "I AM NOT IN A POSITION TO CONFIDENTIAL PAGE 03 ROME 02257 091415Z SAY, HOWEVER, THAT THE PROPOSED SALES ARE CONTROLLED, THAT THEY SHOULD BE CONSIDERED AS INTENDED FOR MILITARY PURPOSES." HE SAID MFA WOULD TALK TO THE COMPANIES SPECIFIED REFTEL -- FABBIO BUZZI DESIGN AND ISOTTA FRANCHINI -- AND SHARE ITS FINDINGS WITH POST. ¶4. (C) IN CLOSING, DE MOHR NOTED THAT "ANYTHING, EVEN A PAIR OF SHOES, CAN BE INTERPRETED AS DUAL USE. IRAN YOU KNOW HAS A LOT OF COAST TO PATROL AND SOME NEIGHBORS WHO BEAR WATCHING." ACTION REQUEST. DE MOHR WAS NOT THE RECIPIENT OF LAST YEAR'S DEMARCHE IN WHICH WE ASKED MFA TO PREVAIL UPON THE IRANIANS TO STEP UP MONITORING OF OIL TANKERS IN ITS WATERS FOR POSSIBLE SMUGGLING OF IRAQI OIL IN CONTRAVENTION OF UN SANCTIONS. ITALY CARRIED THAT MESSAGE TO IRAN, AND IRAN EVIDENTLY DID INCREASE SURVEILLANCE OF ITS WATERS. WE EXPECT THAT OTHER MFA OFFICES, THE IRANIANS, OR THE COMPANIES INVOLVED WILL POSIT THIS KIND OF PATROLLING FUNCTION AS A LEGITIMATE END-USE FOR THESE SPEED BOATS. WE WOULD APPRECIATE BENEFIT OF DEPARTMENT'S COUNTER-ARGUMENTS. SEMBLER CONFIDENTIAL > 2002ROME02257 - Classification: CONFIDENTIAL