TFIZ01: KUWAIT-CONCERNED ABOUT LEGAL ASPECTS OF

C O N F I D E N T I A L KUWAIT 001082 SIPDIS TASK FORCE 1 FOR EB ACTION OFFICER STATE FOR EB/ESC AND NEA E.O. 12958: DECL: 03/25/2013 TAGS: ECON EFIN ETTC PREL SUBJECT: TFIZ01: KUWAIT-CONCERNED ABOUT LEGAL ASPECTS OF UNFREEZING IRAQI ASSETS REF: STATE 74249 Classified By: AMBASSADOR RICHARD JONES FOR REASONS 1.5 (B) and (D) ¶1. (U) This is an action message -- see paragraph 4. ¶2. (C) In a March 24 meeting with Kuwaiti Minister of State for Foreign Affairs (and Acting Finance Minister) Shaykh Dr. Mohammed Sabah Al-Salem Al-Sabah, Ambassador raised issue of unblocking frozen Iraqi government assets in Kuwait for use in humanitarian efforts, noting that the U.S. had already decided to do this. The Minister asked what the lgal basis was for the U.S. move, since the funds had been frozen pursuant to a UN Secutity Council Resolution. He also suggested that actions to unblock frozen assets could lead to lawsuits against governments by third parties seeking to collect on unpaid Iraqi debts. What provisions had been made for this eventuality? Ambassador presented the MinState a non-paper drawn from reftel talking points and promised to convey the Minister's questions to Washington for review. 3.(C) On March 23, Ambassador met with Kuwaiti Central Bank Governor Shaykh Salem Al-Sabah and presented him with points in reftel. Shaykh Salem said he knew Kuwait still held frozen Iraqi assets, and agreed to see if he could confirm the current value of those accounts. ¶4. (C) Action Request: Post would welcome guidance on legal aspects of the unfreezing actions raised by MinState Al-Sabah. JONES