Identifier
Created
Classification
Origin
06PARIS4218
2006-06-20 08:43:00
SECRET
Embassy Paris
Cable title:  

AUSTRALIA GROUP: 2006 INFORMATION EXCHANGE (IE)

Tags:  PREL PARM ETTC AS FR CBW 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
S E C R E T SECTION 01 OF 08 PARIS 004218 

SIPDIS

STATE FOR ISN/CB, INR, EUR, EAP, EUR/WE

E.O. 12958: DECL: 06/16/2026
TAGS: PREL PARM ETTC AS FR CBW
SUBJECT: AUSTRALIA GROUP: 2006 INFORMATION EXCHANGE (IE)

Classified By: ESTH/NP COUNSELOR ROBERT W. DRY FOR REASONS 1.4 (B),(D)
, (E) AND (H).


-----------
(U) SUMMARY
-----------

S E C R E T SECTION 01 OF 08 PARIS 004218

SIPDIS

STATE FOR ISN/CB, INR, EUR, EAP, EUR/WE

E.O. 12958: DECL: 06/16/2026
TAGS: PREL PARM ETTC AS FR CBW
SUBJECT: AUSTRALIA GROUP: 2006 INFORMATION EXCHANGE (IE)

Classified By: ESTH/NP COUNSELOR ROBERT W. DRY FOR REASONS 1.4 (B),(D)
, (E) AND (H).


--------------
(U) SUMMARY
--------------


1. (C) The following describes highlights of the Information
Exchange (IE) portion of the annual meeting of the Australia
Group (AG),which met in Paris, June 12-15, 2006 (Report on
AG Plenary provided septel). The IE included 48
presentations by 13 AG member states, and 2 presentations
were provided in the Joint Session by 2 member states. The
US provided 20 of the 50 presentations. These presentations
focused on chemical and biological warfare (CBW) programs of
concern, trends and developments in CBW proliferation,
prospective new members, looking ahead, summary of IE
outcomes, and recommendations for the IE report to the
Plenary. All papers referred to below were provided by the
chair (Australia) separately and are available to concerned
agencies upon request. All IE documents received will be
available online at the WINPAC Threat Reduction Monitoring
Group,s Australia Group site on Intelink. The IE held a
joint session with the enforcement experts meeting to enhance
the transparency of information between the two communities
over two days of meetings. The enforcement experts meeting
focused on intangible transfers of technology. END SUMMARY.

--------------
(U) INTRODUCTION
--------------


2. (C) The Chairman opened the Information Exchange Session
with a review of past IE efforts and thanked the membership
for their continued support and commented on the value of the
information exchange for all our efforts to stem the
proliferation of CBW programs worldwide.

--------------
(U) EMERGING TECHNOLOGIES
--------------


3. (S) The US presented on microreactor technology.


4. (S) The UK presented the paper 'Developments in Chemical
Microreactor Technology.' This paper updated the UK paper
from the AG meeting in 2005 on the emergence of this new
technology. Since that time the scientific discipline and
related industrial applications have progressed. This paper

informed the membership on those advances, advised of the
possibilities for misuse and made suggestions for countering
the threat presented by this technology. The paper discussed
the technological advantages, limiting factors, potential
factors that could contribute to CW proliferation,
difficulties for use in CW applications, and considerations
for control. The UK suggested that the AG monitor
developments of microreactors and consider steps to develop
appropriate safeguards to address potential proliferation.
This paper is available online.


5. (S) The US presented on disposable bioreactors.


6. (S) New Zealand commented that the AG needed to be aware
of this technology and be prepared to act on potential
proliferation concerns.


7. (S) The UK presented the paper 'Fentanyls - A Cause for
Concern?" The paper described fentanyls as a highly potent
narcotic analgesic belonging to the opiate family that is
used extensively for analgesia and anaesthesia. It discussed
the Russian Special Forces use of fentanyls in the October
2002 Dubrovka Theatre hostage rescue operation intending to
subdue a group of 50 Chechen rebels but resulting in the
deaths of the rebels and 129 civilians. The use of fentanyls
and their analogues are not included in the schedules of the
CWC, and according to the UK,s assessment was not contrary
to Russia,s obligations under the Convention. The use of
fentanyls has increased the awareness of these chemicals and
may lead to small scale use on the battlefield, which the UK
judges would be prohibited under the CWC. Fentanyls and
their derivatives are controlled nationally and coordinated
internationally by the International Narcotics Control Board
(INCB). Information on the INCB is provided in an annex to
this paper. Both papers are available online.


8. (S) The UK provided a paper entitled, 'Non-Lethal
Warfare: Chemical Incapacitants.' The UK paper notes
non-lethal warfare capabilities are being pursued by a number
of countries and have the potential to be used by the
military and law enforcement agencies in numerous scenarios,
including urban environments and peacekeeping operations.
Non-lethal weapons cover a broad spectrum to include kinetic
devices, barriers, electrical devices such a TASER guns,
directed energy weapons such as lasers, and various
chemicals. Chemical incapacitants can cause sensory
irritation-such as sneezing, coughing, or
lachrymation-disabling physical effects-such as vomiting or
cramps-or sensory nervous efforts-such as sedation,
anesthesia, and sleep. There is considerable interest and
research being done to find incapacitating agents that are
potent and fast acting without the side effects that threaten
human life. The UK judges that the acquisition of non-lethal
warfare capabilities will continue to increase in the next
ten years. This paper is available online.

--------------
(U) REGIONAL CBW OVERVIEWS
--------------


9. (S) Portugal presented a paper entitled, 'The Threat
Represented by the WMD Proliferating Countries.' Portugal
judges that proliferating countries, despite enforcement by
international counterproliferation mechanisms, have adopted
new methods that allow them to be successful in acquiring
goods that can be applied to WMD programs. Portugal suggests
monitoring diplomats suspected of coordinating illicit
procurement as well as front companies and organizations;
reinforcing information sharing at the AG to include as much
actionable information as possible; and monitoring shipping
companies, busy ports, and banking institutions. This paper
is available online.


10. (S) Italy presented on the current status of Libya,s CW
destruction, which was generally consistent with US
information. Italy described Libya,s views for conducting
its CW destruction, focusing on Libya,s desire to install
incinerators at Jufra, the CW storage area, and then
dismantle and relocate them to Tripoli for civilian hazardous
waste disposal. Italy also discussed the status of the
conversion of Libya,s former CWPF at Pharma 150, which
should be finished by August 2006. This conversion is
intended for the packaging of imported drugs for HIV,
tuberculosis, and malaria and will be commissioned in
September 2006. No paper was distributed.


11. (S) The US presented on Libyan CBW.


12. (S) Slovakia presented a paper on two suspicious cases
of dual-use materials proliferation in 2005. During 2005,
the Slovak Information Service received information about
Libya,s interest in procurement of dual-use materials.
Libyan military attach to Slovakia Abdulla Ali BEN OUN
contacted a Slovak citizen engaged in arms trade asking him
to procure boron and polybutadienes ending in hydroxyl
groups. The Slovak mediator immediately considered using a
forged end-user certificate. The second case presented was
on Abbas SADEK, a Slovak citizen of Lebanese origin, who was
officially engaged in procurement of various commodities,
including unidentified chemicals. SADEK was said to be in
contact with OPCW inspectors and experts from Qatar and Saudi
Arabia in December 2005 but no further information was
revealed to determine if any controlled materials were
procured. This paper is available online.


13. (S) The US presented on Iran BW.


14. (S) Germany presented a PowerPoint presentation entitled
'Iran,s Level of Self-sufficiency: Does Iran Still Need
Foreign Assistance for Running a BW Program?' Germany
concluded that Iran is in possession of BW relevant agents
and that it has the scientific knowledge to work on a BW
program. They also concluded that Iran has developed a
dual-use production industry and is en route to becoming
self-sufficient, though it may still need to import freeze
dryers and centrifuges. Iran has acquired dual-use knowledge
that is relevant for BW production and has built dual-use
production facilities. Germany asserted that it is no longer
a question whether Iran is capable of producing BW agents,
but whether it is willing to do so. This PowerPoint
presentation is available online.


15. (S) France presented a paper entitled 'Activities of the
Nature Bio Technology Company.' In the paper, France
suggests that the Nature Bio Technology Company could
produce, within six-months, an industrial production
capability of 1,000 tons of Bacillus thuringiensis (BT)
because of its fermenter capacity. France estimates that the
Iranian Health Ministry needs up to 200 tons of BT for
indigenous malaria control and that 800 tons will be exported
to Sudan and South Africa. The BT was experimentally
produced by the Biological Research Center (BRC) belonging to
the Iranian Research Organization of Science and Technology
(IROST). The production line previously underwent
small-scale tests within IROST. This pilot production was
reportedly conducted on the Shahriyar Research Center of
IROST. This production program of BT allows Iranians to
improve their skills in fermentation and lyophilization
technologies, useful in offensive BW programs. This paper is
available online.

16. (S) New Zealand presented on Iran BW. New Zealand
commented that although there was little evidence of Iran,s
offensive program, there is plenty of information on its
defensive work. Cuba, Russia, India, and China aid Iran,s
defensive work. New Zealand is concerned with Iran,s
biodefense connections to IROST, the Iranian Republican Guard
Corp (IRGC),and the Defense Industry Organization (DIO).
New Zealand noted the possibility that Iran,s defensive work
could be a parallel project to offensive development.
Wellington is most worried about Imam Hussein University and
its development of toxins from shiga, cholera, anthrax, and
clostridium bacteria.


17. (S) The US presented on Iran CW.


18. (S) The Netherlands presented a paper entitled 'Iran:
Involvement of the Special Industries Group in Sulfuric Acid
Projects.' According to the Netherlands, the Iranian Special
Industries Group (SIG) falls under DIO, which is subordinate
to the Ministry of Defense. SIG was responsible for
controlling several entities involved in the CW program.
After Iran acceded to the CWC, SIG entities have been
involved in other projects where they actively seek new
customers. The Netherlands assesses that there is no
evidence that SIG is currently involved in offensive CW work.
The paper discusses two cases involving SIG,s procurement
of sulfuric acid plants, neither of which the Netherlands
assesses have any applicability to CW. Sulfuric acid is
common in the mining and petrochemical industry and is
already available domestically. The Netherlands assesses
that SIG,s involvement with these sulfuric acid plants is
the first time that SIG has been procuring for non-military
related projects and may indicate further commercialization
of SIG. This paper is available online.


19. (S) Germany presented a PowerPoint presentation entitled
'Cooperation Iran-Syria: Traces for a CW Program or
Development of Civil Chemical Infrastructure?' Germany
presented on a Jane,s Defense Weekly article from October
26, 2005 that alleged that Iran was assisting Syria to pursue
an 'innovative chemical warfare program' by establishing 4-5
CW precursor production facilities. Iran would provide the
construction design and equipment to annually produce tens to
hundreds of tons of precursors for VX, sarin, and mustard.
Engineers from Iran,s DIO were to visit Syria and survey
locations for the plants, and construction was scheduled from
the end of 2005-2006. Past Iranian deals with Syria involved
ethylene glycol, sodium sulfide, and hydrochloric acid, which
Germany proposed could produce sulfur mustard. Previous
contacts between Iran and the Syrian defensive organizations
include a June 2005 antifreeze production line, the transfer
in September 2005 of 1500 graphite anodes, the transfer in
January 2003 of 100kg of Obidoxime Chloride, filter, gloves,
etc., and the transfer in 2003-4 of ND-CAM detectors.
Germany,s general assessment of these activities is that
there is no indication of an independent CW-precursor
production in Syria, and Iran has strongly limited know-how
in chemical plant engineering. Germany also has no recent
information on Syrian attempts to procure nerve agent
precursors. Germany assesses that Syria is building an
infrastructure for basic chemicals, the Syrian Army or
Scientific Studies and Research Centre (SSRC) is procuring
dual-use chemicals for sulfur mustard (including sodium
sulfide),there is cooperation between the Iranian and Syrian
defensive organizations, and there is long-standing
cooperation between Iran and Syria on NBC-related matters.
This PowerPoint presentation is available online.


20. (S) The Netherlands presented a paper entitled
'Proliferation-Relevant Applications of Monoethylene Glycol.'
The Netherlands began the paper by listing common
monoethylene glycol (MEG) applications and noted that it is
not on any control lists domestically or internationally.
The Netherlands recently commissioned an independent
scientific study on the possible application of MEG in the
production of CW because an unidentified Dutch company
recently supplied shipments of MEG to the Syrian Ministry of
Industry. The Syrian Ministry of Industry certified the
chemicals were to be used in the production of urethane and
antifreeze. The Netherlands noted that the Syrian Ministry
of Industry allegedly serves as a front organization for
procurement efforts of the SSRC under the Syrian Ministry of
Defense. The Netherlands said that the MEG can be converted
to 2-chloroethanol, which can be used for the production of
VX and sulfur mustard. In the past, SSRC had a need for MEG
given the supply of ten tons of MEG by the Iranian DIO in

2002. The Netherlands discussed how to make 2-chloroethanol
using MEG. The Netherlands commented that they are not at
this time recommending the inclusion of MEG on any AG control
lists, but welcome comments from other AG members on MEG
trade to countries of concern. This paper is available
online.


21. (S) The US presented on Syria CW.

22. (S) France presented a PowerPoint presentation on Syrian
cooperation with Russia. France presented on an unspecified
joint project between the Syrian Environmental Studies
Research Centre (ESRC) and the Oriental Petrochemical
Industry (VNKHK) of Russia. The ESRC would own 49 percent
and the Russian company would own 51 percent. The people
involved in the joint project were Mahmod Saleh Soliman and
Mustafa Tiaess from the ESRC, and Arkadiy Vinogradov from
VNKHK. France also talked about a publication from 1998
describing a project between Mustafa Tiaess and Anatoliy
Kuntsevich, the former Soviet chemical warfare expert, on
activated carbon. France noted that Kuntsevich was suspected
to have provided Syria with precursors prior to his death.
This PowerPoint presentation was not given out at the meeting.


23. (S) The US presented on Syria BW.


24. (S) Argentina noted the distribution of a paper entitled
'Biological Weapons Programs - An Overview.' The papers
contain an annex with a table that highlights Argentina,s
assessments on BW proliferation concerns. The countries
include: Iran, Iraq, Syria, Egypt, Libya, Cuba, North Korea,
Pakistan, India, and China. The paper and annex is available
online.


25. (S) Argentina noted the distribution of a paper entitled
'Chemical Weapons Programs - An Overview.' The papers
contain an annex with a table that highlights Argentina,s
assessments on CW proliferation concerns. The countries
include: Iran, Iraq, Syria, Egypt, Libya, North Korea,
Pakistan, India, and China. The paper and annex is available
online.


26. (S) New Zealand commented on possible Iranian-Syrian
cooperation. New Zealand assesses that the cooperation is
mainly driven by Iran,s desire for increased strategic
importance in the region. New Zealand also assesses that
Iran,s biotechnology sector is far more advanced than
Syria,s, and Iran does not mind sharing its knowledge with
Syria.


27. (S) The US presented on Albania CW and Russia CBW.


28. (S) Canada interjected a comment regarding Russian
transparency related to the CWC and BTWC. Canada noted that
since former President Yeltsin,s announcement in 1992 of the
existence and termination of the Russian BW program. Russia
in 1992 submitted Confidence Building Measures (CBM)
documentation to the BTWC, which detail numerous institutes
involved in offensive BW programs. Since that time, Russia
has repeatedly denied ever having an offensive BW program.
Canada encouraged Russia to open MOD institutes to AG member
states in an effort to answer questions regarding Russia,s
current activities and past Soviet activities. Canada noted
that Russian transparency would be increased if it submitted
an updated CBM. Russia has failed to acknowledge public
statements made by former Russian CW researchers on
Novichok, CW agents. Canada mentioned that current
Russian CW experts are still restricted from traveling
abroad. Canada continues to have concerns regarding Russian
compliance in the CWC.


29. (S) The US presented on Pakistan CBW.


30. (S) France presented a paper entitled 'Pakistan
Cooperation with China.' France stated that since the
beginning of 2004, Pakistan has been dealing with the Chinese
company, Polytechnologies Inc. to acquire a production plant
of military grade activated carbon with a capacity of 500
tons per year. This project also would supply analysis
equipment to certify the activated carbon, protection means
to handle toxic chemicals during the certification tests, and
some chemicals used for these tests- cyanogen chloride,
hydrocyanic acid, phosgene, and dimethyl methyl phosphonate
(DMMP). France noted that when Pakistan receives these
elements, Pakistan will be able to indigenously produce
efficient filters for individual and collective protection
against chemical warfare agents. Moreover, they will have a
certification laboratory for military grade activated carbon.
France mentioned that via this cooperation, Pakistan is also
trying to acquire knowledge of toxic chemical production and
a 200Kg quantity of DMMP, a major precursor for sarin, soman
and VX. This paper is available online.


31. (S) US presented on India CBW.


32. (S) Australia gave a presentation on South East Asia CBW
Proliferation. Australia does not believe that any country
in South East Asia appears to be developing an offensive CBW
capability. Australia has concerns with the area because of
the possibility of proliferation and potential terrorist
access. Australia noted that South East Asia lacks export
control legislation, the motivation to enact legislation, and
a capability to enforce export controls. Australia noted that
the busiest ports are Singapore and in Malaysia, and they
have uneven enforcement of export controls. Australia noted
that ports in Cambodia and Brunei may be next. Regional
terrorist groups are interested in CBRN capabilities, but
they are assessed to have low technological sophistication.
For these terrorist groups, the initial acquisition of
virulent pathogens and chemicals pose the greatest challenge.
Australia commented that Jemaah Islamiyah (JI) prefers
methods that induce mass casualty outcomes, rather than
disruption, but Australia assesses that JI,s interest in BW
related attacks may have been reduced by recent safehouse
raids. Australia has concerns with the security of CBW
materials in the area because security is less stringent than
the West. The Philippines and Indonesia are upgrading
biocontainment facilities to BL3 at the Research Institute
for Tropical Medicine and the Research Institute for
Veterinary Science, respectively. New Zealand raised its
concerns over the proliferation of high biosecurity
containment facilities to these countries, except for
Singapore. New Zealand,s general concerns stem from an
assessment that these facilities are poorly maintained,
poorly funded and are lacking in procedures and processes to
guarantee the security of highly pathogenic organisms.


33. (S) The UK presented a paper entitled 'Production of AG
listed Dual-Use Chemical Manufacturing Equipment in Non-AG
Countries in Asia.' The UK judges that producers of AG
listed dual-use chemical manufacturing equipment have been
identified in China, India and Taiwan and that these
countries have sufficiently large and developed chemical
industries to justify a market for indigenous manufacturers
of this type of equipment. Additionally, Bangladesh,
Indonesia, Malaysia, Pakistan, Philippines, Singapore,
Thailand and Vietnam have a limited number of civil
requirements for dual-use chemical manufacturing equipment.
No manufacturers of this type of equipment have been
identified in these countries. Myanmar and the DPRK (N.
Korea) may have legitimate civil requirements for some
dual-use chemical equipment, though the UK cannot accurately
assess their requirements for this type of equipment. This
paper and its supporting tables are available online.


34. (S) The US presented on DPRK CBW and China CBW.


35. (S) The UK presented a paper on China,s Research
Institute of Chemical Defense (RICD) that they assess is an
institute of concern. Canada commented on China,s joint
project with France to build a BL-4 facility in Wuhan but
asked if any member had specific information regarding the
location of this facility. The US commented that it would
investigate this issue and raise it with Canada
intersessionally. This paper was not distributed at the
meeting.

--------------
(U) TOXIC EVENTS
--------------


36. (S) Australia presented information concerning toxic
events in Australia in 2005. On 21 February 2005, 57 people
were affected by an unknown toxic exposure at the Melbourne
airport. Forty seven of the 57 were hospitalized with
symptoms of nausea, vomiting, throat tightness, and shortness
of breath. There were no indications of toxic release, and
subsequent testing (at 3 hrs and at 5 hrs after the first
symptoms appeared),including after the HVAC system returned
to normal operation, showed no evidence of contaminants.
Australia commented that only ten to fifteen were credible
casualties because they reported symptoms at a time
consistent with the chain of events. Australia assessed that
the event was most likely chemically, rather than
biologically, caused, because the victims recovered quickly,
there were no abnormalities in their blood (NFI),and there
were no long term effects; however, Australia has not
identified a chemical that would cause the symptoms, and
there was no specific information that Melbourne,s airport
was a potential target. A full investigation of possible
causes for the event did not reveal suspect toxic substances
and the event was declared unexplainable. There were several
white powder events during June at the Indonesian embassy in
Canberra as well as one event at Parliament House also in
June 2005. No toxic material was detected in the white
powder. The Australians assessed that these events were
related to the trial of an Australian citizen convicted in
Indonesia on drug trafficking charges. The last confirmed
powder incident that tested positive for at least Bacillus
thuringiensis occurred in 2004 at the Sydney airport. The
presentation highlighted the disruptive effect that even a
low-grade CBW-related incident could cause.

--------------
(U) TERRORISM AND OTHER NONSTATE ISSUES
--------------

37. (S) The US presented on CBW terrorism.


38. (S) Canada presented on terrorist CBW capabilities.
Canada assesses that anthrax, ricin, and botulinum toxin (bot
tox) are the most sought after agents, but there has been no
success in their production due to a lack of resources and
expertise. Most jihadist internet recipes are crude and
incomplete or technically inaccurate as to affect the quality
and quantity of product. In contrast to most recipes, a
comprehensive terrorist botulinum toxin manual in mainly
English with some Arabic was found on the web. The SITE
Institute recovered the approximately 25-paged manual and
posted it on the web at www.siteinstitute.org. Canadian
defense experts found the manual is too technically detailed
for most terrorists, but it is the most accurate found to
date. It compiles information from various sources including
the Journal of Medical Science, the US FDA, Protein
Purification Protocols, and other open sources. The manual
contains six chapters: 1) Finding Clostridium
botulinum/isolation and purification, 2) Conditions for toxin
production, 3) isolation and purification, 4) Mouse toxin
assay, 5) Storage and stability and, 6) Weaponization. The
instructions on finding Clostridium botulinum are sparse, and
there are omissions or vague guidelines on liquefaction and
selecting pure isolates and anaerobic growth conditions. The
instructions on protein purification using ammonium sulfate
precipitation are inefficient but could work because they are
technically accurate. There are some errors in math and
figures quoted, especially with regard to toxicity and growth
times, but experienced microbiologists could decipher the
instructions and could potentially produce 664 lethal human
oral doses, if optimally disseminated. The author suggested
novel mechanisms for dissemination, including dissolving the
toxin in detergent and water and using a nebulizer to
disperse the suspension. The author notes that 0.5-5 microns
is the optimal particle size for dissemination, and he also
suggests a method for producing a dusty form of bot tox and
for poisoning food and water. The Canadians assess the
author has a reasonable understanding of microbiology and
probably has some formal education. The author understands
English well, but he probably retyped the information from
other English-language sources. In conclusion, the Canadians
noted that the manual is the most comprehensive jihadist
toxin production manual produced to date, and a skilled
person could produce some bot tox, but the individual would
need to produce multiple batches for anything beyond a
small-scale attack. The Canadians assess that the improvised
spray solution would not be efficient at producing
casualties, and the isolation of Clostridium botulinum from
soil would pose the most daunting challenge.


39. (S) Italy presented a PowerPoint presentation on
'Emerging Zoonoses Could Influence AG Lists?' The focus of
the presentation is the hazard posed by zoonotic disease as
they jump from animals to human-to-human disease. Many
zoonotic diseases, such as rabies, are appropriate for
terrorist purposes because of their high morbidity and
mortality. Insect vectors make disease monitoring and
surveillance difficult. Zoonoses have an expanding host
range, and Italy cited SARS, vCJD, HIV, Ebola, and influenza
as recent examples of agents that have crossed into the human
population. The presentation notes animal diseases
notifiable to the World Organization for Animal Health (OIE)
and those noted by the WHO. Italy presented the EU,s
monitoring data for several zoonotic diseases, and noted that
very few of the agents that cause these diseases are on the
AG control lists. Italy specifically discussed avian
influenza, West Nile Virus, and rabies incidents and
outbreaks. Italy,s considerations when weighing the threat
posed by zoonotic diseases are that 75 percent of emerging
diseases have zoonotic origin, foodstuffs should be the
preferred method of dissemination by nonstate actors, acts of
terrorism would most likely be small-scale, and new hazardous
microorganisms could be used as BW. Italy concluded that the
AG should continuously monitor and update its control lists
or design new criteria for the addition of new agents. This
paper and its supporting tables are available online.

--------------
(U) DENIALS AND TREND ANALYSIS
--------------


40. (S) Australia presented on CBW denial and catch-all
trends. Iran is consistently the country with the highest
number of CW/BW denials. Iran is also responsible for most
catch-all denials, which are mostly BW-applicable. Since
1991 overall denials have risen from less than five in 1991
to a peak of 35 in 1995, to a low again in 1999 of ten to a
peak of almost 55 in 2003, with a decline to 44 in 2004.
While specific denials are down, the continued rise of
catch-all denials since 1996 is of interest, perhaps
indicating new proliferation risks, changes in proliferant
behavior, and/or the need to evaluate the control lists.
Iran, Pakistan, Syria, India, and the DPRK continue to
represent the greatest share of CW denials and Iran, India,
Pakistan, and Syria dominate the catch-all denials. In 2005,
Iran represented the majority of all BW denials. Precursors
constitute the bulk of CW denials, particularly potassium and
sodium cyanide (tabun precursors),sodium sulfide, thionyl
chloride (mustard precursors) and sodium fluoride (sarin).
BW denials are for equipment specifically fermenters, freeze
dryers, and incubators. Overall denial processing time has
increased recently, and despite our efforts, proliferators
continue to seek controlled technology. The increase in
catch-alls may mean that the AG control list should be
updated.

--------------
(U) TRADE IN AG-CONTROLLED ITEMS
--------------


41. (S) France presented a paper entitled, 'Problems
Relating to the Export of Used Dual-Use Chemical
Manufacturing Equipment.' France assesses that trade in used
chemical manufacturing equipment can circumvent export
controls of dual-use items. Some trade and export companies
are not always familiar with European legislation on the
export of dual-use items and do not apply for export
licenses. France suggested affixing proof marks, or
markers, which state the equipment is subject to export
controls, to the equipment at the end of the manufacturing
process. Such markers could aid in immediate recognition of
the sensitivity of certain products and enhance traceability.
France concluded that the issue of export controls of used
chemical manufacturing equipment calls for in-depth
examination and global action. Although at first glance this
market appears to be a marginal one, it nonetheless presents
vulnerability that should definitely be taken into account.
During the joint Information Exchange-Enforcement Session the
following morning, Canada supported France,s proposal on
marking dual-use equipment and recommended that this proposal
be explored by AG members in the future. France will
follow-up intersessionally on their proposal to affix marks
to AG controlled equipment.

--------------
(U) PROSPECTIVE NEW MEMBERS
--------------


42. (S) The Chair invited members to comment on Russia,s
interest in becoming a member of the Australia Group. The UK
commented on their concerns regarding Russian transparency
about its CBW programs. The UK doubts the accuracy of the
Russian CWC declaration, and efforts to clarify concerns have
been unsuccessful. The UK assesses that Russia maintains a
CW program and makes agents that can defeat defensive
measures that are not declared to the OPCW. The UK was
concerned about the possibility that incapacitants, like
those used in the Dubrovka Theater, may be a part the
offensive CW program. The UK thinks that Russia may have a
CW mobilization capability and stores precursor chemicals.
The UK believes that Russia,s export control enforcement is
feckless. Russia,s CW infrastructure was the largest ever
assembled, and that although work with the ISTC has mitigated
many risks, the UK nonetheless harbors several concerns about
past and current activities. The UK also is concerned that
Russia,s offensive BW program may continue, and several
questions remain because of a lack of access to Russian
military facilities. The UK mentioned that there were a
number of occasions where Russia demonstrated poor export
control (NFI). Russia,s BW program was the largest in
history, involving thousands of scientists, so the potential
for proliferation is enormous. ISTC initiatives have helped
mitigate some of the threat, but there are a number of
outstanding issues. In conclusion, the UK stated that they
remain concerned about the transparency of past CW and BW
programs, whether the programs have continued, Russia,s
behavior and compliance with arms control regimes, and the
effectiveness of Russian export controls.


43. (S) The Chair asked the plenary to note the arguments
in favor of continued caution over Russia,s prospective
membership. See septel for Australia Group statement on
Russian and Croatian membership.

--------------
(U) OTHER MATERIALS
--------------


44. (S) Spain distributed a paper that was not presented
entitled 'Iran Strategies for the Procurement of Dual-use
Materials, Equipment, and Technologies.' The paper concluded
that proliferating countries such as Iran have changed their
procurement strategies because of the difficulties in
procuring material for WMD programs. The trends are directed
toward the use of front companies and intermediaries abroad,
but this will result in a rise in the real cost of the goods
and a decrease in the reliability of equipment. As an
alternative to these procurement methods, proliferating
countries will seek to set up networks that are not connected
to the governments. One may see front companies and
intermediaries involved in the same commercial transactions.
This paper is available online.

--------------
(U) LOOKING AHEAD
--------------


45. (S) Romania commented that an updated version of the
CD-ROM describing AG members, export controls was not
available because Romania was still waiting on input from AG
members. The Chair reported to the plenary to encourage
members to provide updated information on their export
controls as soon as practicable.


46. (S) The Chair of the IE sought ideas for the 2007 IE.
Biosecurity, specifically in South East Asia, and emerging
technologies, such as chemical microreactors and disposable
bioreactors, were again flagged for discussion during the
meeting. The Chair recommended to the plenary that
biosecurity, specifically in South East Asia, and emerging
technologies, such as chemical microreactors and disposable
bioreactors, be considered for next year,s agenda.


--------------
(U) JOINT INFORMATION-ENFORCEMENT EXCHANGE
--------------


47. (S) The US presented on CW internet message boards.


48. (S) Japan gave a PowerPoint presentation on several
case studies involving suspicious cargo transfers from China
to Pakistan through Japan. The four cases presented occurred
in 2005, and the three ships involved were the Bolan, the
Islamabad, and the Khairpur. All were Pakistani owned
vessels. The first Bolan transfer was of 600 tons of
ferrosilicon and an unknown quantity of anhydrous sodium
sulfate from NORINCO to a Pakistan ordinance factory. The
Islamabad had 196 boxes of detonators and 175 boxes of
ammunition, also from NORINCO. The second Bolan transfer
involved a rubber vulcanization machine, 1,215 tons of sodium
sulfide, and 110 tons of ferrosilicon from Tianjin Foreign
Trade Chemical and Medical Products Company to an unknown
consigner in Pakistan. The Khairpur had a cargo of sodium
sulfide, caustic soda, aluminum chloride, zinc chloride, and
aluminum hydroxide. The Japanese Coast Guard inspected all
of these ships, and notified the authorities of the results,
but no enforcement action was taken because cargoes could not
be opened without the consent of the shippers, and the
Japanese Coast Guard believed there was a high probability
that the shippers would deny permission. Japan needs a legal
basis to take action to suspend or stop the transit or
transshipment of items. Japan is working on domestic
measures to deal with these issues to include transit,
transshipment, and brokering.


49. (U) For additional information on the 2006 AG
information exchange or copies of presentations, where
available, contact Christian Westermann, Department of State
(INR/SPM),Washington, DC 20520; e-mail
westermanncp2@state.sgov.gov or cwestermann@state.ic.gov or
(202) 647-8230 or SECURE 978-2011. This cable has been
coordinated with Embassy Paris and the AG U.S. Delegation.

STAPLETON
Please visit Paris' Classified Website at:
http://www.state.sgov.gov/p/eur/paris/index.c fm

STAPLETON