UNCLAS SECTION 01 OF 09 THE HAGUE 002707

SIPDIS

SENSITIVE

STATE FOR AC/CB, NP/CBM, VC/CCB, L/ACV, IO/S
SECDEF FOR OSD/ISP
JOINT STAFF FOR DD PMA-A FOR WTC
COMMERCE FOR BIS (GOLDMAN)
NSC FOR CHUPA
WINPAC FOR LIEPMAN

E.O. 12958: N/A
TAGS: PARM PREL RS CWC
SUBJECT: CHEMICAL WEAPONS CONVENTION (CWC): WRAP-UP FOR
THE EIGHTH CONFERENCE OF STATES PARTIES (CSP-8)

REF: STATE 295421

This is CWC-113-03.

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SUMMARY
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1. (U) The U.S. accomplished all of its primary objectives
at the Oct. 20-24 OPCW Eighth Conference of States Parties
(CSP-8). The Conference approved the U.S. request for an
extension of its 45% destruction deadline to December 2007
and extended in principle the U.S. 100% destruction deadline.
There was agreement on the 2004 OPCW budget with an increase
of 6.7%, retention of the 2001 cash surplus, and future
consideration of steps for retention of Article IV/V
surpluses. Action plans on universality and on national
implementation under Article VII were also approved. The
ICRC request to address the CSP was not/not approved.
Finally, on the issue of the ILO decision regarding former
Director-General (DG) Bustani, the Conference Chairperson
(Ariffin/Malaysia) issued a statement by which the Conference
approved a proposal instructing the OPCW's lawyers to attempt
to negotiate a settlement and, if settlement efforts failed,
reserving to the OPCW the right to seek reconsideration by
the ILO Administrative Tribunal of the amount of damages
awarded. End Summary.

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U.S. EXTENSION REQUEST
--------------


2. (U) The U.S. and Russia came to agreement on our
respective CW destruction extension requests. The CSP
approved the U.S. request to extend its intermediate 45% CW
destruction deadline to December 31, 2007 as well as Russia's
20% CW deadline to April 29, 2007. The Conference also took
a decision to extend Russia's 45% and 100% destruction
deadlines "in principle." In order to satisfy WEOG and other
States Parties' concerns regarding the United States'
intermediate 45% deadline going beyond the final deadline of
April 29, 2007, the U.S. agreed also to extend its final
destruction deadline "in principle".


3. (U) The primary source of disagreement between the U.S.
and Russia was the matter of including site-visits as a
condition for supporting each other's extension requests.
The U.S., as well as a number of WEOG m

embers, believe that
site-visits are an important transparency feature that ought
to be maintained as a condition for approving Russia's 20%
extension request as well as for its "in principle" extension
requests. However, concerns over reciprocity resulted in the
U.S. accepting Russia's condition of no site visits for
either side, as well as discontinuing extra-Convention CW
destruction program reporting requirements.


4. (U) At the eleventh hour, the French insisted, as a
condition for joining consensus, that text from paragraph 28,
Part IV(A) of the Verification Annex, dealing with a State
Party's requirement to report to the Executive Council (EC)on
its final phase of destruction activity, be inserted in the
decision document. The French stated that the added text
would provide reassurance to concerned States Parties that
Russia's 100% CW "in principle" extension meets the same
transparency measures applied to an approved date positive
for extension. The French also stated that the added text
lessens the ambiguity many WEOG members believe exist with
the extension "in principle" concept.

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2004 OPCW BUDGET
--------------


5. (U) The Conference adopted a 73,153,390 Euro budget for
2004 in its Decision on the Programme and Budget and Working
Capital Fund (C-8/DEC/CPR.17). This came on the final day of
CSP-8, only hours after the Director-General, the Director of
Administration (Schulz/US), the budget facilitator
(Beerworth/Germany), and U.S. and other key contributors
hammered out a package that also included a Decision on
Withholding Distribution of the 2001 Cash Surplus
(C-8/DEC/CRP.8/Rev.1) and a note by the Director-General
(C-8/DG.6). The DG's Note explains how he proposes to
deliver the full core program of OPCW activities while also
providing an additional 250,000 Euros for International
Cooperation and Assistance, all within a 6.7% overall budget
increase (below his earlier bottom line of 7.36%). All
requirements established in guidance were met, including
language in the budget decision document concerning
consultants, indications of where reductions will be made to
reach the 6.7% budget level, and a clear marker laid
concerning our desire for more emphasis on OCPF inspections
in future years.


6. (U) This package calls for establishing a special
account funded by withholding the remainder of the 2001 cash
surplus with a separate CSP decision. Of the surplus, 1.355
million Euros is to cover the costs of implementing the
previous CSP's tenure decision; and a further 250,000 Euros
will finance the ICA increase to be returned back to the
surplus through efficiency savings in the course of 2004.
The DG is authorized to draw on the rest of the surplus to
maintain the ICA and inspection programs or for other
exceptional needs, subject to prior approval by the Executive
Council, and is to report on the use of the funds to the
Ninth CSP.


7. (U) On Article IV and V Income, the Conference requested
the Executive Council and the Director-General to examine
ways to enhance financial stability and facilitate smoother
program delivery. This decision drew on the EC's decision to
study Article IV and V funding options including the possible
establishment of a Program Stabilization Fund.

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ARTICLE VII - NATIONAL IMPLEMENTATION ACTION PLAN
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8. (U) The Conference adopted the Plan of Action recommended
by the October 21 special session of the Executive Council.
At the start of the CSP, India and Iran had threatened to
block consensus on the document. As approved by Washington,
Ambassador Javits, the facilitator (Consuelo Femenia/Spain)
and members of the U.S. delegation met with Indian and
Iranian delegation members to reach agreement on two critical
issues: 1) that "it is imperative" that member states
fulfill obligations under Article VII by the CSP-10 deadline,
and 2) that the Conference, at CSP-10, will "consider and
decide upon appropriate measures, if necessary" to address a
States Party's failure to meet this obligation. The Indian
and Iranian delegation were amenable to this implementation
as an important obligation without the direct or indirect
reference to Article XII, thus leaving the option open for
the Conference to, as the situation calls for, decide upon
further assistance, extension of timeline or punitive
measures.

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UNIVERSALITY ACTION PLAN
--------------


9. (U) The CSP endorsed the Universality Action Plan adopted
by the second Special session of the EC convened during the
Conference. The final text, worked out in two intense
informal discussions late in the week, includes the two key
elements sought by the USG, designating "points of contact"
by States Parties for the effective promotion of
universality, and calling on the Technical Secretariat to
prepare a comprehensive annual document that will "set
indicative targets for increased membership."


10. (U) The Conference noted the DG's report on
implementation of the CSP-7 recommendation on ensuring the
universality of the Convention. It accepted South Korea's
proposal not to adopt a similar recommendation in 2003 in
light of the adoption of a more concrete Action Plan by the
EC.

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REQUESTS TO ATTEND/ADDRESS CSP-8
--------------

11. (SBU) Iraq and Libya were granted non-speaking,
observer status for the Conference. Prior to the opening of
the CSP, Amb. Javits met with the CSP-7 Chairman
(Djoudi/Algeria) to emphasize the U.S. objection to the
request from the ICRC to address the Conference (reftel).
Javits noted that the States Parties had a full agenda for
CSP-8. The Chairman suggested a compromise by which the ICRC
would be allowed to speak "if time allows," recognizing that
there would be no time available. Javits objected to the
proposal, stressing the point that acceding to the ICRC
request even in principle would set a bad precedent. The
OPCW would not be able to deny other NGOs or international
organizations the right to address future Conferences.
Should the States Parties wish to hear from the ICRC or some
other body, stressed Javits, then the member states can
invite that organization to speak. The General Committee
agreed to deny the ICRC request.

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BUSTANI JUDGMENT
--------------


12. (U) The Conference addressed the Bustani issue late on
October 24th. Through a statement delivered by the
Conference Chairperson, the Conference approved a proposal
instructing the OPCW's lawyers to attempt to negotiate a
settlement, and, if settlement efforts failed, reserving to
the OPCW the right to seek reconsideration by the ILO
Administrative Tribunal of the amount of damages awarded.
Following Conference approval of the Chair's proposal, the
Brazilian representative stated that he could not associate
himself with the proposal, and claimed that ILOAT awards are
required to be implemented immediately under international
law.


13. (U) Brazil asserted that failure to make immediate
payment was a violation of international law, and strongly
implied that the OPCW and the Conference were guilty of such
a violation. The Brazilian representative requested that his
statement be included in the Conference Report. Canada noted
that it was concerned by the fundamental question of the
Tribunal's jurisdiction, but concluded it would not block
consensus in view of the general support for the Chair's
proposal. Ambassador Javits then delivered the USG response,
cleared in Washington, refuting the implication that the
OPCW's conduct could in any sense be viewed as a violation of
international law. He noted that the process outlined by the
Chair is fully consistent with existing legal procedures and
that it would be premature and imprudent for the OPCW to make
any payment decision, before all proper options could be
explored, including reducing the damages. Ambassador Javits
also noted the rashness implicit in Mr. Bustani's filing of
an execution order with the ILOAT on Monday, October 20,
before the Conference had even had time to address the
matter. Ambassador Javits further stated his understanding
that the Chairperson's statement regarding the OPCW
"reserving for itself" the right to seek a review meant that
the Organization will indeed return to the ILO on the issue
of material damages should the negotiations fail, to which
there was no objection stated. The Ambassador requested that
his statement also be added to the Conference Report.


14. (U) The following are the results of other agenda items.

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AGENDA ITEM ONE - OPENING OF THE SESSION
--------------


15. (U) CSP-7 Chairman Djoudi opened the session. The
Conference approved the participation of nine NGOs and two
chemical industry associations. The ICRC was included in the
list of "international organizations, specialized agencies,
and other international bodies" attending the CSP.

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AGENDA ITEM TWO - ELECTION OF THE CHAIRMAN
--------------


16. (U) The conference elected by acclamation as
Chairperson Ambassador Noor Farida Arrifin of Malaysia.

-------------- --------------
AGENDA ITEM THREE - ELECTION OF VICE CHAIRMEN AND OTHER
OFFICERS
-------------- --------------


17. (U) The CSP elected the following ten States Parties as
Vice-Chairs: Bosnia, Guatemala, India, Japan, Mexico,
Nigeria, Poland, South Africa, Switzerland and the United
States. Ambassador Djoudi was elected Chairman of the
Committee of the Whole.

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AGENDA ITEM FOUR - ADOPTION OF THE AGENDA
--------------


18. (U) The Agenda was adopted without debate.

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AGENDA ITEM FIVE - ORGANIZATION OF WORK AND ESTABLISHMENT OF
SUBSIDIARY BODIES
-------------- --------------


19. (U) The agenda item was adopted without debate.

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AGENDA ITEM SIX - APPOINTMENT OF THE CREDENTIALS COMMITTEE
-------------- --------------


20. (U) The following ten members of the Credentials
Committee were elected to hold office until the next CSP:
Austria, Cameroon, Cuba, Czech Republic, Jordan, Namibia,
Pakistan, Portugal, Ukraine and Uruguay.

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AGENDA ITEM SEVEN - STATEMENT BY THE DIRECTOR-GENERAL
-------------- --------------


21. (U) In his opening statement, DG Pfirter said
destruction activities were continuing at "a good pace" and
noted that on average one new State Party had acceded to the
CWC every month over the preceding year. He alluded to calls
from the Staff Council to suspend implementation of the
previous CSP's decision to impose tenure limits on OPCW staff
until the ILO Administrative Tribunal ruled on the suits
brought by a number of OPCW inspectors whose contracts had
not been renewed. The DG noted that implementation had
already begun and that any move to suspend further action
would have to be taken by the CSP, which had made the initial
decision. No States Party moved to suspend implementation.

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AGENDA ITEM EIGHT - GENERAL DEBATE
--------------


22. (U) Ambassador Javits delivered the U.S. statement,
which has been included on the OPCW Internet site for the
Conference. A total of 38 other delegations made statements.
Most noteworthy were statements from Arab delegations
(Algeria, Qatar) alleging that Israel had extensive chemical
and other WMD stocks, and the statement from Panama that
referred to the issue of San Jose Island.

-------------- --------------
AGENDA ITEM NINE - STATUS OF IMPLEMENTATION OF THE CONVENTION
-------------- --------------


23. (U) The Conference noted the Report on National
Implementation Measures (C-8/DG.5 dated 18 September 2003)
after agreeing to minor corrections to the text as requested
by Belgium and Iran. Iran noted that Annex 1 did not
correctly reflect the contents of its Note Verbale to the TS
and requested that it be revised to show that its legislation
covers all areas key to enforcement and that the text of its
measures to date has been provided.

24. (U) The Conference noted the Report by the DG on
Implementation of the Regime governing the Handling of
Confidential information by the Technical Secretariat in 2002

SIPDIS
(EC-32/DG.16 C-8/DG.1, dated 12 March 2003), presented to the
Conference in accordance with paragraph A.3 of the
Confidentiality Annex.

SIPDIS


25. (U) The Conference noted the Note by the DG on a
non-exhaustive list of illustrative examples of chemical
weapons that meet the definitions contained in Article II,
subparagraphs 1(b) and 1(c) of the Convention (C-8/DG.2,
dated 10 April 2003).

--------------
AGENDA ITEM TEN - REPORT OF THE OPCW FOR 2002
--------------


26. (U) The Conference approved the draft report of the
OPCW on the implementation of the Chemical Weapons Convention
in 2002 (EC-34/4/C-8/CRP.1, dated September 2003). The
German Delegation requested that the draft report be amended
to reflect that the FRG submitted Article 10 declarations
during 2002. The German amendment was also approved by the
Conference.

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AGENDA ITEM ELEVEN - REPORT OF THE EXECUTIVE COUNCIL
-------------- --------------


27. (U) The Conference noted the report of the Executive
Council on the performance of its activities in the period
from 17 July 2002 to 27 June 2003 (EC-34/3 C-8/3, dated 23
September 2003). The report was introduced by the EC
Chairman, Ambassador Petr Kubernat of the Czech Republic, who
also introduced the recommendations of the Council that
required the attention of the Conference, including those
made after the cut-off date for the above report.


28. (U) Among the noteworthy items recommended after the
cut-off date for the above referenced report, is the report
of the visit by the EC Chairman and by the States Parties
Experts Group to the Gorniy CW destruction facility and to
construction sites in Kambarka and Shchuch'ye in the Russian
Federation on 6-10 October 2003. In his introduction, the
Chairman specifically referenced the report's observation
that Russia's efforts to destroy 20% of its Category 1
chemical weapons stockpiles by the 29 April 2007 deadline it
has proposed may be hindered by delays caused, inter alia, by
slippages in construction schedules and in construction
starting dates, by financial constraints, and, possibly, by
the need to provide social infrastructure to local
populations in advance of the construction of CWDF's.


29. (SBU) The Conference approved the request by "another
States Party" for an extension of its 45% destruction
deadline.


30. (U) The Conference granted final approval to the
procedures for revising the technical specifications for
approved equipment, approved provisionally by the 31st
Executive Council (EC-31/DEC.8, dated 12 December 2002). The
final approval is contained in C-8/DEC/CRP.6, dated 10
October 2003.


31. (U) The Conference adopted a decision (on "Boundaries
of Production") on understandings regarding declarations
under Article VI and Parts VII and VII of the Verification
Annex to the Convention (C-8/DEC/CRP.13/Rev.1, dated 22
October 2003).


32. (U) At an October 24 Special Session, the Executive
Council considered and deferred a decision on the issue of
Captive Use until its next regular session. The Indian,
Chinese and Russian Federation delegations blocked consensus
on grounds that last-minute changes to the text made by the
facilitator (Rudduck/UK) as a result of sidebar discussions
during the Conference would need to be reviewed by technical
experts in capitals. Late changes made to the text clarify
the exclusion of transient chemicals from declaration,
drawing upon text already approved in the Boundaries of
Production decision text approved by the Conference. The
facilitator did not circulate a text prior to the session to
allow for sufficient review by States Parties, opting instead
to include announcement of the changes during his statement
to the EC.


33. (U) The Conference noted the audited financial
statements of the OPCW for the year 2002, including the
response of the DG to the External Auditor's report
(EC-33/DG.5 C-8/DG.3, dated 10 June 2003). These audited
financial statements, and the External Auditor's report and
opinion, were forwarded by the Council to the Conference with
its comments (subparagraph 17.2 of EC-34/5, dated 26
September 2003), in accordance with Financial Regulation
13.10.


34. (U) The Conference noted the report of the Office of
Internal Oversight (OIO) for the period from 1 January to 31
December 2002, and the accompanying note by the
Director-General (EC-34/DG.4, dated 17 June 2003; Corr.1,
dated 18 August 2003; and Corr.2 dated 19 September 2003)
transmitted to the Conference by the 34th Executive Council
Session. The Conference also noted the comments of the
Council at its 34th Session on the work carried out by the
OIO (paragraph 16 of EC-34/5, dated 26 September 2003). The
Brazilian Delegation specifically requested to note the
comments of the 34th Session on the work carried out by the
OIO. The Brazilian Delegation also requested an additional
sentence to the Conference Report be added that mandated that
the Conference "review the matter of recruitment and
appointments." Ambassador Javits objected to the Brazilian
proposal, stressing that there had been no such agreement by
the Conference. Canada spoke in support of Ambassador
Javits, and the Brazilian request was
not adopted.


35. (U) The Conference approved the amendments to the
Financial Regulations that the DG had submitted to it through
the Council (C-8/DEC/CRP.10 dated 16 October 2003).


36. (U) The Conference noted the Note by the DG on the use
of the Working Capital Fund, which the Council had forwarded
to it (EC-34/DG.12, dated 12 September 2003).

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AGENDA ITEM TWELVE - ELECTION OF MEMBERS OF THE EXECUTIVE
COUNCIL
-------------- --------------


37. (U) CSP-8 elected the following States Parties to the
Executive Council to serve a term of two years commencing on
12 May 2004:

African Group:
Algeria, Kenya, Morocco, South Africa

Asian Group:
Iran (Islamic Republic of), Malaysia, Pakistan, Sri Lanka

Eastern European Group:
Russian Federation, Serbia and Montenegro, Ukraine

Latin American Group and the Caribbean:
Cuba, Panama, Peru, Uruguay

Western European and Others Group:
Greece, Netherlands, New Zealand, Norway, Spain

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AGENDA ITEM THIRTEEN - PROGRAMME AND BUDGET OF THE OPCW
-------------- --------------


38. (U) The Conference did not agree to the DG's proposal
to increase the number of Article VI inspections
(EC-34/DG.11, dated September 4, 2003), from 132 to 150, to
be conducted in 2003 resulting from cost-savings achieved by
the Technical Secretariat's optimization and efficiency
efforts. Consensus on this issue was blocked by the Germans,
who are concerned that such an increase would set a precedent
for the Technical Secretariat to conduct activities at levels
exceeding the negotiated program of work. It emerged, during
the course of discussion, that after the EC had told the DG
not to proceed with these inspections and forwarded the issue
to the CSP for consideration, six additional inspections
above the approved level were conducted.

--------------
AGENDA ITEM FOURTEEN - SCALE OF ASSESSMENTS
--------------


39. (U) After a substantial amount of last-minute
confusion, the Conference adopted the use of the forthcoming
2004 UN scale of assessments modified for differences in
membership, as the basis for the OPCW 2004 scale. The U.S.
delegation appreciated the expert advice on scale issues
provided by IO/S on short notice.

-------------- ---
AGENDA ITEM FIFTEEN - FOSTERING OF INTERNATIONAL COOPERATION
FOR PEACEFUL PURPOSES
-------------- ---


40. (U) The facilitator (Suarez/Mexico) reported orally to
the EC that there is not yet agreement on what proposal
should be submitted to the Conference, as requested at CSP-7.
As such, the item was not raised at CSP-8. The Conference
noted the statements by Iran, India and Pakistan on this
matter, and referred this issue to the Council for its
further consideration, with a view to the Council forwarding
a proposal at CSP-9 for consideration and approval.

-------------- --------------
AGENDA ITEM SIXTEEN - AGREEMENTS ON THE PRIVILEGES AND
IMMUNITIES OF THE OPCW
-------------- --------------


41. (U) The Conference adopted the decision on the draft
agreement between Bosnia and Herzegovina and the OPCW on the
privileges and immunities of the OPCW (C-8/DEC/CRP.1, dated
25 September 2003).


42. (U) The Conference adopted the decision on the draft
agreement between the Republic of Burundi and the OPCW on the
privileges and immunities of the OPCW (C-8/DEC/CRP.2, dated
25 September 2003).


43. (U) The Conference adopted the decision on the draft
agreement between the Republic of Cyprus and the OPCW on the
privileges and immunities of the OPCW (C-8/DEC/CRP.3, dated
25 September 2003).


44. (U) The Conference adopted the draft decision on the
draft agreement between the Slovak Republic and the OPCW on
the privileges and immunities of the OPCW (C-8/DEC/CRP.4,
dated 25 September 2003).


45. (U) The Conference considered and adopted the decision
on privileges and immunities agreements between the OPCW and
States Parties (C-8/DEC/CRP.5, dated 7 October 2003).


46. (U) The U.S. delegation made a statement from the floor
noting that these agreements, like others previously adopted,
go well beyond the status, privileges, and immunities
required by the Convention and well beyond what the U.S.
would be prepared to accept in its own bilateral agreement
with the OPCW.

-------------- --------------
AGENDA ITEM SEVENTEEN - ENSURING THE UNIVERSALITY OF THE
CONVENTION
-------------- --------------


47. (U) The Conference noted the report by the DG on the
implementation of the recommendation of CSP-7 on ensuring the
universality of the Convention (C-8/DG.4, dated 1 August
2003).
-------------- --------------
AGENDA ITEM EIGHTEEN - REPORTS OF SUBSIDIARY BODIES
-------------- --------------


48. (U) Conference action under the heading "Reports of
Subsidiary Bodies" was handled in perfunctory fashion. The
Conference adopted the Report of the Credentials Committee
noting that representatives from 116 States Parties and
states participating on a provisional basis were represented
at the Conference. Other subsidiary bodies were not called
upon to report.

--------------
AGENDA ITEM NINETEEN - ANY OTHER BUSINESS
--------------


49. (U) See Bustani discussion in paragraphs 12 and 13.


50. (U) In General Committee ("Bureau") discussions, the
U.S. made the point that it might be more advantageous for
each CSP to elect the officers for the subsequent CSP,
particularly the Chairman. The U.S. provided the text of the
proposed amendment of Rule 34 for consideration.

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AGENDA ITEM TWENTY - DATE AND DURATION OF THE NEXT REGULAR
SESSION OF THE CSP
-------------- --------------


51. (U) The Conference decided to hold its ninth session
from November 29 to December 3 or, if facilities were
unavailable for that week, for the period December 6-10.

-------------- --------------
AGENDA ITEM TWENTY-ONE - ADOPTION OF THE REPORT OF THE CSP
-------------- --------------


52. (U) The report was adopted by the Conference.

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INFORMAL CONSULTATIONS WITH TS ON OPTIMIZING VERIFICATION
-------------- --------------


53. (U) The U.S. met with a team of approximately ten
Technical Secretariat Verification and Inspectorate
Directorate personnel (headed by Dr. Reeps, Director of
Verification) to discuss specific questions regarding the
TS's and U.S.'s concept for verification. Both sides were

SIPDIS
encouraged with the fact that, conceptually, our ideas on
what is required for verification are closely aligned, and
both concepts provided a good opportunity to reduce existing
TS inspector manpower levels at operating U.S. CW destruction

SIPDIS
facilities.


54. (U) It was agreed that we must take a "systems approach"
to verification with the goal of better understanding the
inter-relationship between verification activities at
chemical weapon storage facilities and chemical weapon
destruction facilities. From this understanding we are
confident that we can identify and focus on activities (or
reference points) that are absolutely essential for
verification.


55. (U) Aside from general questions presented to the TS on
their concept paper, del emphasized the following points with
regard to the evaluation criteria we would apply in
determining the suitability of the concepts being considered;
1) maintaining effective verification of other States
Parties; 2) ensuring the concept does not disrupt CW
destruction operations; 3) any quantitative measurements
decided upon must not lead to potential CWDF compliance
issues; 4) final verification system determinations will be
made on a facility-by-facility basis and; 5) establishment of
an effective and efficient verification process, not simply
the notion of an "across-the-board" manpower reduction of
plus-or-minus 30%. The TS proposed that the next near-term
steps include an "expert" workshop to work through questions
on the specific elements of each other's verification
proposals, and a site visit or visits to a U.S. facility or
facilities to develop verification system concept case
studies.


56. (U) Javits sends.
SOBEL