Identifier
Created
Classification
Origin
06THEHAGUE1987
2006-09-12 11:52:00
UNCLASSIFIED
Embassy The Hague
Cable title:  

CHEMICAL WEAPONS CONVENTION (CWC): WRAP-UP FOR

Tags:  PARM PREL CWC 
pdf how-to read a cable
VZCZCXYZ0000
OO RUEHWEB

DE RUEHTC #1987/01 2551152
ZNR UUUUU ZZH
O 121152Z SEP 06
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6770
INFO RUEAIIA/CIA WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RHEBAAA/DEPT OF ENERGY WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC PRIORITY
UNCLAS THE HAGUE 001987 

SIPDIS

SIPDIS

STATE FOR ISN/CB, VCI/CCB, L/ACV, IO/S
SECDEF FOR OSD/ISP
JOINT STAFF FOR DD PMA-A FOR WTC
COMMERCE FOR BIS (GOLDMAN)
NSC FOR DICASAGRANDE
WINPAC FOR WALTER

E.O. 12958: N/A
TAGS: PARM PREL CWC
SUBJECT: CHEMICAL WEAPONS CONVENTION (CWC): WRAP-UP FOR
WEEK ENDING SEPTEMBER 8


This is CWC-79-06.

--------------------
BUDGET CONSULTATIONS
--------------------

UNCLAS THE HAGUE 001987

SIPDIS

SIPDIS

STATE FOR ISN/CB, VCI/CCB, L/ACV, IO/S
SECDEF FOR OSD/ISP
JOINT STAFF FOR DD PMA-A FOR WTC
COMMERCE FOR BIS (GOLDMAN)
NSC FOR DICASAGRANDE
WINPAC FOR WALTER

E.O. 12958: N/A
TAGS: PARM PREL CWC
SUBJECT: CHEMICAL WEAPONS CONVENTION (CWC): WRAP-UP FOR
WEEK ENDING SEPTEMBER 8


This is CWC-79-06.

--------------
BUDGET CONSULTATIONS
--------------


1. (U) The first budget consultations after the summer break
were held on September 5. The first intervention was made by
the Malaysian delegate who provided delegations with the
"NAM" position on the budget. This included: concerns about
the low level of funding for ICA, concerns about the
redistribution of industry inspections, a desire to
reorganize the order of work so that the core objectives
could be reopened and discussed before the budget is examined
program by program, and the strong assertion that setting
policy through the budget process would be unacceptable.
Iran, Cuba (the soon to be Chair of the NAM),Algeria,
Pakistan, Nigeria, India, Brazil, and Mexico subsequently
made interventions to support the NAM view as enunciated by
Malaysia. (Comment: This development is clearly troubling as
it is the first time according to other dels present that a
regional group has laid out a position in informal
consultations on the budget. It also could prove to be
problematic as it was clear that most of the NAM's points
were essentially driven by Iran. End Comment)


2. (U) Japan asked why the why the rental subsidy in table
23 on page 71 had increased by 400%. The Technical
Secretariat responded that there was a typographical error in

SIPDIS
table 23 and that the figures in the 2007 column for
dependency allowance and rental subsidy had been transposed,
as had the figures in the same column for medical care
benefits and death and disability benefits.


3. (U) Iran suggested that all of the items in appendix 7
should be included in the regular budget and not be in a
separate appendix. They also said they were very concerned
about the distribution proposed for Article VI inspections
and saw no need for the creation of two new P-2 positions in
ICA to support Article VII implementation. Iran observed
that if the amount budgeted for the two P-2 positions was
removed, the ICA budget would be less in 2007 than it was in

2006. Iran objected to the reference to the "significant

challenges" presented by the tenure policy in paragraph 4.79.
The Iranians also asked for a list showing the nationalities
of all temporary staff listed in table 22, in order to ensure
that equitable geographic distribution was considered in the
hiring of temporary staff. They also said they were opposed
to the continued use of temporary staff in human resources
and would asked for a list of all consultants engaged by the
TS.

SIPDIS


4. (U) The Netherlands asked about the plan to devolve
training in the TS and what future role the Training Division
would play. The Dutch also asked if there were any
provisions in the budget for the ten-year anniversary
commemoration of the OPCW. Budget chief Rick Martin said
that the goal in devolving training was to get individual
managers more involved in training decisions and to save
money. He noted that some divisions, such as the
Inspectorate, had been designing their own training for some
time. Ron Nelson, Director of Administration, added that the
Training Committee, which is chaired by the Deputy Director
General, would closely monitor the devolution process to
ensure that it was effective. Martin said there was no money
earmarked for the ten-year anniversary in the budget, but
that there was a trust fund for voluntary contributions.


5. (U) Italy asked if the transition assistance for
departing TS employees was new and if there would be any
changes in the travel office. Martin said that some
transition assistance was provided for out of the Human
Resources budget but that this year the TS had decided to
specifically earmark 30,000 euros in the budget for
transition assistance. Nelson said that the TS was currently
reviewing tenders to procure a new travel agent which would
hopefully dramatically improve the quality of travel services
provided. He also said that the TS had hired someone to
revamp the TS internal travel monitoring and voucher system.



6. (U) Although the consultation was supposed to cover the
Office of Confidentiality and Security, there was not enough
time. The facilitator announced that the OCS budget would be
examined at a later date.


7. (U) Budget consultations covering the Inspectorate and
Verification division budgets were held on the morning of
September 7. The primary focus of the consultation was the
significant increase in the number of OCPF inspections
planned in 2007. Horst Reeps, Director of the Verification
Division, strongly defended the TS plan to significantly
increase the number of OCPF inspections. He began the
consultation by noting that 80% of the TS inspection activity
was focused on CW inspections.


8. (U) The TS, according to Reeps, was asking for an
additional 20 industry inspections for 2007 over 2006. He
justified the decrease in the number of schedule 1 and 2
inspections by noting that on average schedule 1 facilities
had been inspected six times and that the average for
schedule 2 facilities was two inspections. Reeps said that
with the 2007 budget proposal, schedule 1 facilities would be
inspected every 1.8 years as opposed to every 1.2 years under
the 2006 budget. He said that about half of schedule 3
facilities had not yet been inspected so the TS had not
proposed reducing the number of schedule 3 inspections. In
terms of OCPF inspections, Reeps highlighted the fact that of
5000 OCPF sites, only 400 will have been inspected by the end
of 2006. He also pointed out that the declarations for OCPF
facilities were not as detailed as the declaration forms for
scheduled chemical facilities. For all of these reasons, the
TS feels a need to increase the number of OCPF inspections in

SIPDIS
order to raise the confidence level of SPs.


9. (U) Del rep noted that there was no "discount factor"
built into the Article IV and V income projections for 2007,
as there had been for previous years. Del rep asked if this
was because the TS was more confident about the projections
for Article IV and V inspection activity. Ichihiro Akiyama,
Director of the Inspectorate, said that because there were no
new CWDF facilities going online and the TS had finalized all
of its optimization activities in the U.S., the TS was much
more confident in its projections. Budget director Martin
added that he too was confident with the income projections
for Article IV and V activity.


10. (U) India referred to the NAM position and asserted that
they still believed that the budget consultations were not
the proper forum to address dramatically increasing the
number of OCPF inspections, as this was essentially a policy
and not a budget issue. The Germans countered that the CWC
verification annex requires the TS to provide a breakdown of
industry inspections and therefore the budget consultations
were the appropriate forum to discuss the distribution of
industry inspections. Japan supported Germany. The UK also
supported Germany and added that the First Review Conference
Report also called for increasing the number of OCPF
inspections.


11. (U) Iran said that they too supported the NAM position
and were opposed to discussing a "political issue" such as
the distribution of industry inspections in the budget
consultations. Iran said they would also like more
information on the cost of sampling analysis. They also said
they opposed 5000 inspector days being set aside for
training, especially for training related to challenge
inspections. Cuba and Brazil also supported the NAM position
on OCPF inspections.


12. (U) Mexico also opposed discussing redistributing
Article VI inspections in the budget context. They also
suggested that given the problems that possessor states were
having in meeting deadlines that perhaps some of the money
budgeted for Article VI inspections could be better spent on
Article IV and V inspections.


13. (U) South Africa said that they too associated
themselves with the NAM position on the budget. South Africa

said that it was clear that delegations were uneasy with the
significant increase in OCPF inspections, but that perhaps a
more detailed discussion of the issue would serve to put some
delegations more at ease on the issue.


14. (U) China said that further discussion was needed on the
OCPF issue and asked if any violations had been detected to
date at any OCPF facilities. Reeps responded that no
violations had occurred to date involving OCPF facilities.


15. (U) France, Australia, and Austria supported the
increase in OCPF inspections. The Netherlands asked if there
were additional costs associated with sampling analysis and
if the size of inspection teams had to be increased. Akiyama
said that inspection teams would have to be larger when
sampling analysis was conducted but that other costs were
only marginally higher.


16. (U) The afternoon budget consultation focused on the
core objectives on the budget. Despite the fact that the NAM
delegations had requested the consultation, no delegation
proposed any changes to the core objectives or performance
indicators. Iran said that they had instructions from
capital that the key outcomes for 2007 found in column 3 on
page 18-19 should be deleted. No other delegation supported
this and most of the WEOG delegations present and Japan
opposed deleting the outcomes. The DDG and the facilitator
also supported the retention of the outcomes, but noted that
after reviewing the entire budget delegations may want to
consider revising or making changes to the outcomes. Iran
again said they would like to have the outcomes column
deleted from pages 18-19.

--------------
REPAYMENT PLAN CONSULTATIONS
--------------


17. (U) Consultations to review a draft decision document
(dated August 29, 2006) on creating a repayment mechanism to
regularize payments of arrears were held on Sept 6.
Approximately 30 delegations attended the meeting. The
facilitators had hoped to get delegates to briefly review the
decision text and then seek approval of the text at a
subsequent meeting. But the meeting quickly devolved into a
drafting exercise with no clear outcome. There is still a
reasonable prospect that a decision text will be ready in
time for the EC in November, but it will clearly take more
than one or even two additional consultations to reach an
agreement.


18. (U) Delegations were generally pleased with the
preambular language in the draft text, though Iran did
suggest moving all of PP 5 to replace all of OP 7. There was
no clear consensus on this suggestion. Iran also said that
the phrase "linked to other measures" found in OP 3 was too
vague and suggested that a more explicit reference regaining
voting rights should be made. Germany and Australia
suggested that OP 3 could be deleted, as they did not want to
highlight the word "voluntary." Iran pushed back and said
that would like to keep the reference to "voluntary" because
no SP could be forced into entering a repayment program with
the TS, but that if the first word in OP 2 were changed from
"Invite" to "Encourage," Iran could agree to delete OP 3.


19. (U) The UK suggested that repayment period in OP 4 be
reduced from six years to four years and that the words "by
the CSP" be added at the end of OP 4c (i). The UK had told
us privately that they intended to push for the reduction in
the allowable repayment period as a tactical move in order to
have something to give away should Iran and others ask for
more painful changes later in the negotiations. Iran asked
that OP 4a be deleted claiming that it was too onerous for
SPs to explain the reasons they had fallen into arrears.


20. (U) Del rep pushed back and said that SPs needed to know
why an SP fell into arrears in order to justify to their
capitals why repayment plans and the eventual return of
voting rights should be approved. Del rep also supported the
UK's tactical call for reducing the repayment period to four

years. South Africa, Pakistan, and Algeria supported the
deletion of OP 4a and maintaining a six year window for
repayment. Del rep indicated that the U.S. could be flexible
on the payment period, but would have to have some
explanation for the reasons an SP fell into arrears before
being able to approve a repayment plan. The UK supported the
U.S. There was no consensus, but a compromise is likely
achievable at the next consultation.


21. (U) Iran called for the deletion of OP 6c and OP 7.
Germany, the UK, and Australia said that they could accept
the deletion of OP 6 c but would like to retain OP 7. Iran
said that perhaps a compromise could be found on OP 7. The
UK suggested that the word "approval" be deleted from OP 6 as
it would prejudge the outcome of negotiations on any
repayment plan. Italy supported the UK. China suggested
that any references to the return of voting rights should be
removed from OP 6 and put in a separate OP to avoid
confusion. South Africa said they would like to see OP 6b
deleted and OP 7 redrafted.


22. (U) On OP's 8 and 9, Germany suggested that rather than
granting an exception to financial regulation 5.6 they would
favor amending financial regulation 5.6. The facilitator
noted that in previous consultations most delegations had
opposed revising the financial regulations and preferred to
grant one time exceptions to the regulation. Iran and South
Africa suggested deleting OP 8 as it was redundant. Japan
and the U.S. proposed retaining OP 8.


23. (U) The facilitators will likely review the suggestions
made by delegations and attempt to craft some form of
compromise language before the next consultation, which has
not yet been scheduled. Del believes that an eventual
compromise will be found, as most NAM delegations do not want
to be seen blocking an initiative that would benefit poorer
countries. Del will endeavor to prevent the requirements of
any repayment plan from becoming so watered down as to be
unenforceable and at the same time ensure that Iran and
others are not able to push through language that would force
the U.S. to become the lone spoiler of a repayment plan.

--------------
CONFIDENTIALITY

SIPDIS
--------------


24. (U) Facilitator Betsy Sanders held a September 5
informal consultation on the topic of how to handle long-term
storage of classified materials held by the TS. Luis
Cavalheiro of the TS presented his update, "Non-paper on the
Development and Implementation of Guidelines Regarding the
long-Term Handling of Confidential Material." In response to
delegations' questions during the spring 2006 consultation,
Cavalheiro noted that the questions of document "ownership,"
status of electronic copies of official documents, or the
legal status of electronic originals had been referred to the
Office of the Legal Advisor (OLA). Noting that 73 percent of
the TS holdings were related to Article VI inspections, the
TS emphasized the importance of deciding what materials

SIPDIS
should be kept, and what should eventually be destroyed.


25. (U) Canada asked about the practices of other
international organizations regarding retention/storage of
classified materials, noting that these could guide us in our
deliberations. OLA's Isaac Minta noted that the OPCW's
Policy on Confidentiality (OPOC) laid out guidelines that
should provide the basic criteria. Cavalheiro deferred,
noting that the OPOC had not touched on the destruction of
information. He also noted that the OPCW receives a mixture
of commercial and governmental information, making the TS
holdings unique.


26. (U) Canada also questioned whether delegations were
clear on what we were trying to address. There are four
considerations: a) space management, b) TS repository as
historical record, c) format of repository - electronic
(takes up little space) or paper; legal status of electronic
records, and d) CWC implementation, especially verification,
and what might be needed and over how long a period.

Pakistan agreed, and said that the most important task
delegations faced was deciding what should be kept and for
how long.


27. (U) Italy asked who owned the information: the
submitting SP or the TS? Germany, supported by Romania and
South Africa, added that the SP owns any information it
submitted and must give its concurrence for destruction.
Italy also noted that material such as initial declarations
should be retained indefinitely. The Netherlands added that
delegations rely on the TS as a repository of information,
able to retrieve historical documents and decisions to inform
delegates on the history of negotiations. Iran indicated
that perhaps it could accept electronic copies as record
copies.


28. (U) The facilitator attempted to lead a discussion of
the types of Article VI information held by the TS with a
view to whether it should be retained indefinitely, ten
years, or five years. Because the TS table had been designed
for another purpose, the discussion bogged down. The TS
promised to provide a more specific table of types of
information held in storage for the next (October)
consultation.


29. (U) Javits sends.
ARNALL