E.O. 13382 DESIGNATIONS OF TWO SWISS ENTITIES

S E C R E T STATE 047923

SIPDIS


E.O. 12958: DECL: 03/21/16
TAGS: PARM PREL ETTC EFIN PGOV MNUC

SUBJECT: E.O. 13382 DESIGNATIONS OF TWO SWISS ENTITIES

REF: 05 STATE 120771

CLASSIFIED BY ISN FRANCIS C. RECORD, ACTING, REASONS: 1.4
(B),(C),AND (D).


1. (U) This is an action request. Embassy Bern and US
Mission to the EU please see paragraph 3. Embassies
Beijing, Moscow, Seoul, and Tokyo, please see paragraph 5.


2. (U) Background: On June 28, 2005 the President issued
Executive Order (E.O.) 13382 allowing the U.S. to block or
"freeze" the assets of weapons of mass destruction (WMD)
proliferators and their supporters (reftel). The E.O.
authorizes the Secretary of the Treasury, in consultation
with the Secretary of State and the Attorney General, and
other relevant agencies to designate individuals or
entities determined to be owned or controlled by, or
acting or purporting to act for or on behalf of, directly
or indirectly, those entities or individuals identified in
the Annex of the E.O. or subsequently designated pursuant

to the E.O. In addition, the E.O. authorizes the
Secretary of the Treasury, in consultation with the

SIPDIS
Secretary of State, the Attorney General, and other

SIPDIS
relevant agencies to designate individuals or entities
determined to have provided, or attempted to provide,
financial, material, technological or other support for,
or goods and services in support of, individuals or
entities identified in the Annex to the E.O. or
subsequently designated pursuant to the E.O. Persons that
are designated under the Order are denied access to U.S.
financial and commercial systems, and U.S. persons,
wherever located, are prohibited from engaging in
transactions with them. Two entities that are located in
Switzerland are being designated as a result of their
relationship with Korea Ryonbong General Corporation,
which is identified in the E.O. Annex. The designations
will be published on OFAC's List of Specially Designated
Nationals and Blocked Persons (SDN List)on March 28, 2006.


3. (U) Action Request for Embassy Bern and US Mission to
EU. Washington requests Posts deliver the Points in
paragraph 4 on Tuesday, March 28 two hours prior (local
time) to 10:30am EST. Washington requests the US Mission
to the EU to use the points with Ambassadors from all EU
countries and the EU leadership. Points in paragraph 4 may
be left as a non-paper.


4. (S/Rel Switzerland,EU)

Begin Talking Points for Switzerland and EU Member States

-- In the spirit of olr security cooperation, we are
informing you that the U.S. Department of the Treasury
will be announcing the designation of two Swiss entities
under Executive Order 13382 (E.O. 13382),thereby blocking
their assets and property within U.S. jurisdiction and
prohibiting U.S. persons from engaging in transactions
with them. These designations will be published on the
Office of Foreign Assets Control's (OFAC) consolidated
List of Specially Designated Nationals and Blocked Persons
(SDN List) on March 28, 2006 and subsequently published in

the Federal Register. The SDN List can be found at
www.treas.gov/offices/enforcement/ofac/sdn.

-- In June 2005, President Bush signed Executive Order
13382 (Blocking Property of Weapons of Mass Destruction
Proliferators and Their Supporters).

-- The Order allows the U.S. to block or "freeze" the
property and assets subject to U.S. jurisdiction of
weapons of mass destruction (WMD) proliferators and their
supporters. Persons that are designated under the Order
are denied access to U.S. financial and commercial
systems, and U.S. persons, wherever located, are
prohibited from engaging in transactions with them.

-- We would like to notify you in advance that the U.S.
Government will designate the following two entities
pursuant to on March 28, 2006.

1) Kohas AG, which acts as a technology broker in Europe
for the North Korean military and has procured goods with
weapons-related applications.

2) Jakob Steiger, as President of Kohas AG, acts or
purports to act for or on behalf of Korea Ryonbong General
Corporation. Jakob Steiger has been involved in
activities of proliferation concern on behalf of North
Korea since his company's founding in the late 1980s.

-- The Korea Ryonbong General Corporation was named in
June 2005 in the Annex to E.O. 13382 and the Korea
Ryengwang Trading Corporation was designated on October
21, 2005 because it is owned or controlled by, or acts or
purports to act for or on behalf of the Korea Ryonbong
General Corporation.

-- As a subsidiary of the Korea Ryonbong General
Corporation, the Korea Ryengwang Trading Corporation owns
nearly half of the shares of Kohas AG and Jakob Steiger
owns the remaining half.

-- These designations are part of the ongoing effort by
the U.S. government to combat WMD trafficking by blocking
the property of entities and individuals that engage in
proliferation activities and their support networks.

-- The Executive Order is not targeted specifically at any
state or region, but at entities and individuals around
the world that are engaged in WMD proliferation and/or in
providing support or services for such proliferation
activities.

-- USEU Only: -- Designation of these Swiss entities is
the first such action directed against entities outside of
Iran, North Korea, and Syria under the provisions in E.O.
13382.1

-- The United States will continue to take the actions
necessary to disrupt and dismantle the networks that
support proliferation and expose proliferators' activities
to the international community such that others can take
similar action, pursuant to their own legal authorities,
to deny them access to their financial systems.

-- We request that you not make public this action until
after its official USG release scheduled for local time
corresponding to 1030 EST.

For Switzerland only

-- Beginning as early as 2001, the U.S. raised concerns
with your government about Kohas AG serving as a
proliferation-related broker for the North Korean
military. Additionally, we were informed by your Economic
Ministry that the activities of Kohas AG and its owner
were well known and should have been shut down years ago.

-- Your government investigated Kohas AG and told us that
they had not exported goods to North Korea that required
export licenses. Again, we reiterated our concerns in
2002 that, while not requiring export licenses,

proliferation-related items were shipped that should have
been addressed by your catch-all export controls.

-- To enhance further our bilateral security cooperation,
we urge your government to take strong and immediate
action against proliferators such as Kohas AG.

End Talking Points for Switzerland and EU Nations


5. (U) Action request for Embassies Beijing, Moscow,
Seoul, and Tokyo. Washington requests that Posts deliver
the points in paragraph 6 to appropriate host country
government officials on Tuesday, March 28 two hours prior
(local time) to 10:30am EST. The points in paragraph 6 may
be left as a non-paper.


6. (S/REL China, South Korea, Japan, Russia)

Begin Talking Points for Six Party Talks Nations

-- Because of our close cooperation on stopping WMD
proliferation networks and our shared objectives in the
Six-Party Talks, we wish to inform you of an announcement
related to such efforts that will be made in Washington on
March 28, 2006.

-- In June 2005, President Bush signed Executive Order
13382 (Blocking Property of Weapons of Mass Destruction
Proliferators and Their Supporters).

-- The Order allows the U.S. to block or "freeze" the
property and assets of weapons of mass destruction (WMD)
proliferators and their supporters, which come within U.S.
jurisdiction. Persons that are designated under the Order
are denied access to the U.S. financial and commercial
systems, and U.S. persons, wherever located, are
prohibited from engaging in transactions with them.

-- We would like to notify you that the U.S. will
designate the following two entities on March 28, 2006
pursuant to E.O. 13382:

1) Kohas AG, which acts as a technology broker in Europe
for the North Korean military and has procured goods with
weapons-related applications.

2) Jakob Steiger, as President of Kohas AG, acts or
purports to act for or on behalf of Korea Ryonbong General
Corporation. Jakob Steiger has been involved in
activities of proliferation concern on behalf of North
Korea since his company's founding in the late 1980s.

-- The Korea Ryonbong General Corporation was named in
June 2005 in the Annex to the E.O. and the Korea Ryengwang
Trading Corporation was designated on October 21, 2005
because it is owned or controlled by, or acts or purports
to act for or on behalf of the Korea Ryonbong General
Corporation.

-- As a subsidiary of the Korea Ryonbong General
Corporation, the Korea Ryengwang Trading Corporation owns
nearly half of the shares of Kohas AG and Jakob Steiger
owns the remaining half.

-- The designations will be published on the Office of
Foreign Assets Control's (OFAC) consolidated List of
Specially Designated Nationals and Blocked Persons (SDN
List) on March 28, 2006 and subsequently published in the
Federal Register. The SDN List can be found at
www.treas.gov/offices/enforcement/ofac/sdn.

-- These designations are part of the ongoing effort by
the U.S. government to combat WMD trafficking by blocking
the property of entities and individuals that engage in
proliferation activities and their support networks.

-- The Executive Order is not targeted specifically at any
state or region, but on entities around the world that are
engaged in WMD proliferation and/or in providing support
or services for such proliferation activities.

-- Designation of these Swiss entities is the first such
action directed against entities outside of Iran, North
Korea, and Syria under the provisions in E.O. 13382.

-- The United States will continue to take the actions
necessary to disrupt and dismantle the networks that
support proliferation and expose proliferators' activities
to the international community such that others can take
similar action, pursuant to their own legal authorities,
to deny them access to their financial systems.

-- We encourage your public support for this effort and
also hope that you will continue to expand your national
authorities to take steps against similar proliferation-
related entities.

-- We request that you not make public this action until
after its official USG release scheduled for local time
corresponding to 1030 EST.

If asked about impact on the Six Party Talks:

-- The Executive Order is not targeted specifically at
North Korea, but on entities around the world that are
engaged in WMD proliferation and/or in providing support
or services for such proliferation activities. North
Korean proliferation entities and their supporters fall
into this category.

-- As such, designations under the Order are a necessary
step for dealing with the global proliferation threat and
are also complementary to the objectives of the Six Party

Talks.

End Talking Points for Six Party Talks Nations.
RICE


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