AUSTRIA: 2006 COUNTRY REPORT ON TERRORISM

UNCLAS SECTION 01 OF 06 VIENNA 003584

SIPDIS

SIPDIS

DEPT FOR S/CT (RHONDA SHORE) AND EUR/AGS (SAINT ANDRE)

E.O. 12958: N/A
TAGS: PTER ASEC KCRM KPAO KHLS AEMR EFIN AU
SUBJECT: AUSTRIA: 2006 COUNTRY REPORT ON TERRORISM

REF: STATE 175925


1. Per reftel, Post is submitting the 2006 Country Report on
Terrorism for Austria. Embassy POC for this report is
Economic-Political Officer Dayna R. Robison, office phone:
43-1-31339-2196 and email: RobisonDR(at sign)state.gov. Post
emailed the updated Intellipedia version of this report to
the Department on December 20, 2006.

Summary
--------------


2. Summary. Austria is a constructive ally in the fight
against terrorism. In 2006, it allocated twelve million
euros for counterterrorism measures and strengthened its
export controls on weapons and dual-use goods. Austria held
the EU Presidency during the first half of 2006, and held a
series of high-profile talks. In May, Austria hosted a
conference of Justice and Interior Ministers from the EU,
U.S., and Russia, who signed a declaration to increase
cooperation against terrorism. President Bush attended the
U.S.-EU Summit in June. Austria has a comprehensive legal
framework to combat money laundering and terrorism financing
and has achieved compliance with FATF's nine Special
Recommendations. In 2006, Austria maintained three police
instructors at the Iraqi police academy in Jordan. It has
380 UNDOF peacekeepers in the Golan Heights, seven UNTSO
observers in Jerusalem, and four liaison officers at the ISAF
headquarters in Kabul. Austria also has troops and police
representatives in the Balkans. During 2005 and the first
half of 2006, the Interior Ministry stopped nine shipments of
dual-use goods that were destined for Iran, Saudi Arabia,
Pakistan, and North Korea. End Summary.

General Assessment
--------------


3. Austria continues to be a constructive ally in the fight
against terrorism and a leader in implementing regional
anti-terrorism strategies. It follows a two-tiered strategy
of protection and prevention in its fight against terrorism.
Terrorist acts are prosecuted in accordance with Austria's
general criminal statutes and Austria has a comprehensive
legal framework in place to combat money laundering and
terrorist financing.


4. A top priority for Austria, given current demographic
trends in Europe, is to maintain a productive and fruitful
intercultural and religious dialogue with its Muslim
community, in particular. These and related efforts, such as
providing educational, linguistic, and vocational assistance,
are part of Austria's strategy to promote social and economic
integration, prevent the isolation of ethnic and religious
groups, and stop radicalization.


5. Austrian authorities believe the likelihood of a
terrorist attack in Austria is low. According to a recent
poll, only 17 percent of Austrians fear a terrorist attack in
Austria. According to a 2006 report on counterterrorism by
the Interior Ministry's Federal Office for the Protection of
the Constitution and for Counterterrorism (BVT),extremists
could use Austria for "logistical support activities" in the
medium term. The BVT report warns that second and third
generation Muslim immigrants, who feel marginalized or are
not well-integrated into society, are vulnerable to
radicalization.


6. As a percentage of the population, Austria has the second
largest share of Muslims in its population of all EU members,
behind France. There are approximately 340,000 Muslim
citizens or legal residents in Austria, or 4.2 percent of the
population, according to a 2001 census. The government views
the Austrian Muslim community as moderate and highly
cooperative. Resident Austrian Muslims are primarily of
Turkish (about 120,000) and Bosnian (about 50,000) descent.
According to the census, the largest concentrations of
Muslims are in the Austrian province of Vorarlberg (8.4
percent) and in Vienna (7.8 percent),which is home to one
third of the Austrian Muslim population. Austria is also
home to approximately 16,500 Chechen refugees. A
controversial study published by the Interior Ministry in May
2006 claimed that 45 percent of Muslims living in Austria are
unwilling to integrate.


7. During its Presidency of the European Union from January
to July 2006, Austria encouraged the Member States to
implement the EU's anti-terrorism agenda. Key objectives
include improving efforts against terrorism financing,
improving the exchange of law enforcement information within

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the EU, and strengthening EUROPOL. In May, Austria hosted a
ministerial conference on "The Role of Internal Security in
Relations Between the EU and Its Neighbors." The
participants, including U.S. Attorney General Alberto
Gonzales and Department of Homeland Security Deputy Secretary
Michael P. Jackson, signed the "Vienna Declaration on
Security Partnership." This document called for increased
cooperation in the fight against terrorism, organized crime,
corruption, and illegal migration and the need to further
develop the dialogue between religions and cultures.


8. In May, the Austrian Presidency presented a media
communications strategy for preventing radicalization and
recruitment at the bi-annual U.S.-EU dialogue on
counterterrorism. In June, President Bush, Secretary of
State Condoleezza Rice, and other senior U.S. officials
attended the U.S.-EU Summit in Vienna. Counterterrorism
discussions focused on the implementation of biometric
standards and on preventing terrorist financing,
radicalization, and recruitment.


9. Austria continues to promote inter-cultural dialogue as
an integral part of its counter-terrorism strategy. In
April, the government hosted the second European Conference
of Imams in Vienna. In May, the Austrian government convened
a "Dialogue Between Cultures and Religions" for high-ranking
government and religious leaders from around the world. The
government is planning a follow-up conference on Islam in
April 2007. That conference will focus on the role of women.


10. Austrian officials remain highly responsive to U.S.
requests for proliferation-related interventions, both
diplomatically and in terms of concrete law enforcement
action. During the reporting period, government agencies
continued to sensitize customs officials and the business
community to proliferation-related trading schemes, and
encouraged intensified monitoring of commercial shipments.


11. In November, terrorism hit closer to home in Austria
when Iraqi insurgents kidnapped a Kuwait-based Austrian
contract worker, who was accompanying a food convoy on its
way to the Iraqi city of Nassiriya.

Sanctuary Assessment/Terrorist Groups
--------------


12. Austria is not a known sanctuary for terrorist groups.
The BVT closely monitors the movements in Austria of
individuals they suspect of having terrorist connections.
The BVT stepped up surveillance on a number of suspected
Islamic extremists, following the July 2005 terrorist attacks
in London. Such suspects mostly adhere to the radical views
of terrorist organizations in Egypt, Iraq, Pakistan, and
Turkey. In 2006, the BVT continued to monitor four radical
imams. However, Austrian authorities maintain that
radicalized Muslims do not pose an immediate security threat
in Austria and assess their threat potential as low compared
to other groups in Europe. Austria's official Muslim
community has condemned terrorist attacks in Europe and
continues to support ongoing inter-religious dialogue in
Austria.


13. In 2005, Austria introduced stricter immigration laws to
strengthen enforcement of the 2003 Dublin Convention. This
discourages "asylum shopping" and allows the government to
return serial asylum seekers to the EU country where they
first applied for asylum. The new law includes tighter
counterterrorism measures against foreign visa holders, who
are suspected of having terrorist links, of sympathizing with
terrorist acts, or engaging in extremist preaching or
incitement. During the first half of 2006, Austrian Interior
Minister Liese Prokop confirmed that the number of asylum
applicants dropped 32 percent as a result of the new law.
Meanwhile, authorities have noted an increase in applicants
attempting to conceal their transit routes through the EU.


14. In Spring 2006, the BVT responded to press allegations
that it failed to arrest a key suspect in the 2004 Madrid
terrorist bombings, who attempted to enter Austria in April

2004. The BVT clarified that Austrian border police
questioned Abdelmajid Bouchard of Morocco after he illegally
tried to enter Austria from Hungary. The border police
subsequently deported him to Hungary because there was no
international arrest warrant for him at that time.


15. There were few violent incidents this year in Austria
and the authorities attributed most of the incidents to
individuals with right wing, xenophobic, or anti-American
tendencies. These resulted in minor property damage, but no

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causalities. In June, police discovered four fake bombs in
Vienna's first district prior to the visit by President Bush.

Domestic Counterterrorism Actions
--------------


16. In 2005, Austria introduced a legislative package that
earmarked 105 million euros for terrorism prevention measures
and research through the year 2013. It allocated twelve
million euros for 2006.


17. In March 2006, Austria amended its export control
legislation to further restrict transfers of chemicals,
software, and weapons, and to prevent these sensitive
dual-use goods from falling into the terrorist hands. This
action further harmonizes Austrian law with EU and
multilateral export control regimes.


18. During 2005 and the first half of 2006, the Interior
Ministry investigated 921 suspected cases of nonproliferation
and stopped nine shipments of dual-use goods that were
destined for Iran, Saudi Arabia, Pakistan, and North Korea.
This included a friction-testing device for Iran that was
disguised as a pharmaceutical shipment. In December 2006,
according to press reports, Austrian authorities were
investigating the Graz-based firm Daniel Frosch Export (DFE)
on allegations that it delivered accelerators, capacitors,
and condensers to Iran's nuclear program.


19. In August, an Austrian news magazine reported that the
Interior Ministry's Threat Response Center dissolved a
Vienna-based Islamic terror cell in December 2005. The cell
reportedly consisted of five Pakistani men with Austrian
citizenship. Reports alleged that they had connections to
the terrorists responsible for the failed 2006 attacks in
London.


20. October 2006, an Austrian administrative court rejected
an appeal by convicted terrorist Mohammed Abdul (a.k.a. Adel
Sayed Mohammed Abdel) of Egypt to renew his asylum status.
Authorities in Egypt believe Abdul has ties to the Al-Qa'ida
leadership. An Egyptian military tribunal twice convicted
and sentenced him, in absentia, to death for terrorist
activities. Abdul's status in Austria, however, remains
unclear. Austria subscribes to the Geneva Human Rights
Convention and is unlikely to deport Abdul to Egypt or to any
country with the death penalty.

Efforts Against Terrorist Financing and Money Laundering
-------------- --------------


21. Disrupting terrorist financing is an integral part of
Austria's counterterrorism strategy. Austria has a
comprehensive legal framework in place -- in the Austrian
Code of Criminal Procedure, Associations Act, Banking Act,
and Customs Law -- to combat money laundering and terrorism
financing. Austria is a member of the Financial Action Task
Force Against Money Laundering (FATF),and has implemented
and achieved a good level of copliance with all of FATF's
nine Special Recommenations. These measures require
financial institutions and related professionals (e.g.
lawyers, notaries, real estate agents, accountants, casino
owners, etc.) to disclose uspicious financial transactions
and overseas trnsfers of financial payments. Austria
requires all financial transfer and foreign exchange
busineses to obtain a license from the Financial Market
Authority, and has outlawed hawala banking.

22 Austria closely follows EU policies to fight terorist
financing. Austria actively participates i the EU
Clearinghouse mechanism, which designate terrorist
financiers under UNSCR 1373. During 2006, Austria fulfilled
its obligations to freeze assets, pursuant to UNSC
resolutions and EU Clearinghouse designations, but did not
initiate any freezing actions independently. In 2006, the
government began to implement the EU Third Money Laundering
Directive, which will make changes to several laws to further
tighten disclosure requirements on entities that are involved
in financial transactions.


23. In May 2006, Austria signed the Council of Europe
Convention on the Prevention of Terrorism (ETS No. 196) and
the Convention on Laundering, Search, Seizure, and
Confiscation for the Proceeds from Crime and on the Financing
of Terrorism (ETS No. 198). The government is working on
ratifying these agreements as well as the amended Convention
on the Suppression of Terrorism (ETS No. 190),which Austria
signed in May 2003.


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24. In 2004, the Austrian Financial Intelligence Unit and
the BVT received 24 reports of suspected terrorist financing
transactions. These did not result in any convictions.
Figures for 2005 and 2006 are not yet available.


25. In 2004, according to the most recent statistics, money
laundering investigators in Austria received over 1,500
reports and subsequently reported criminal offenses to the
police in 147 cases. Austria also froze accounts worth 27.9
million euros in 2004, according to press reporting, because
of money laundering suspicions. Money laundering in Austria
has connections primarily to fraud and to other criminal
activity, such as drug smuggling and human trafficking.


26. In April, the Austrian EU Presidency hosted a joint
EU-Gulf countries cooperation seminar in Brussels on
Combating Terrorist Financing. Some 100 participants
attended from the EU, U.S., Bahrain, Kuwait, UAE, Oman,
Qatar, and Saudi Arabia. The agenda focused on strengthening
international cooperation among financial intelligence units,
non-profit organizations, and formal and informal banking
systems.


27. In June, Austria hosted a U.S.-EU workshop on terrorist
financing. Approximately 120 representatives from the U.S.,
EU member state governments, and the private financial sector
participated in the conference. The meeting focused on
identifying best practices for ensuring private sector
compliance with financial sanctions. Austria identified two
issues at the conference for future action: the need to
establish a private sector advisory group in connection with
the UN, and the need to establish best practice guidelines
for government officials, who work on sanctions
implementation.

International Cooperation
--------------


28. Austria continued to make modest, but important
contributions to stability in the Middle East and
Afghanistan. In 2006, Austria maintained three instructors
to train Iraqi police at the International Police Training
Center in Jordan. Austria has 380 UNDOF peacekeepers in the
Golan Heights and seven UNTSO/UNIFIL observers working out of
Jerusalem. Four Austrian liaison officers currently serve in
the International Security Assistance Force (ISAF)
headquarters in Kabul.


29. Austria continued efforts to intensify international
police cooperation within the "Salzburg Forum," a recurring
meeting of regional Interior Ministers from Austria, the
Czech Republic, Slovakia, Poland, Hungary, and Italy.
Austria further maintained its lead role in the EU Central
Asian Border Security Initiative (CABSI) and in the Vienna
Initiative on Central Asia (VICA) project. These programs
provide funding, equipment, and technical expertise to
strengthen border security and reduce trafficking of illicit
goods in Central Asia.


30. In December 2006, Austria finalized the Treaty of Pruem
(also dubbed "Schengen III") and was one of the first EU
countries to grant access to its police database to the six
other EU countries that are party to the Treaty. The
signatories hope that access to this information, which
includes DNA, fingerprints, and vehicle data, will help
identify terrorism suspects.


31. Achieving peace and stability in the Western Balkans is
a continuing, key goal of Austria's foreign policy. At the
end of 2006, Austria maintained 579 peacekeepers in Kosovo
(KFOR). An additional 30 Austrian police officers operated
in the area under UNMIK. Austria has 311 troops in Bosnia
(EUFOR). In June, Austria convened a three-day workshop of
experts from Europe, the Western Balkans, Russia, the United
Nations Office of Drugs and Crime (UNODC),and the U.S. to
discuss strategies for fighting drug trafficking along the
Balkan route.


32. In May, Austria participated in Operation Combined
Endeavor, an annual multilateral military exercise that the
U.S. European Command sponsors. The exercise focused on
achieving C4 (command, control, communications, and
computers) interoperability among nations.


33. Austria participates in all major non-proliferation
regimes, including the Australia Group, the Wassenaar
Arrangement (with headquarters in Vienna),and the Missile
Technology Control Regime (MTCR). Vienna is the seat of the
United Nations Office on Drugs and Crime (UNODC) and is a

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"major donor" to the UNODC, with an annual pledge of
approximately $500,000.

Cooperation with the U.S.
--------------


34. Austria hosted several high-profile meetings on
counterterrorism with senior U.S. officials during its EU
Presidency. In May, Austria hosted U.S. Attorney General
Alberto Gonzales and Department of Homeland Security Deputy
Secretary Michael P. Jackson at a meeting of Justice and

SIPDIS
Interior Ministers from the EU and Russia. In May, Austria
also co-chaired the biannual U.S.-EU dialogue on
counterterrorism (COTER),where it presented a media
communications strategy to counter terrorist radicalization
and recruitment. In June, President Bush, Secretary of State
Condoleezza Rice, and other senior U.S. officials visited
Vienna for the U.S.-EU Summit. Central themes of the Summit
included securing international borders, developing biometric
standards, and preventing WMD proliferation, terrorist
financing, and radicalization and recruitment.


35. Austrian authorities continue to react quickly and
competently to U.S. requests for protection of U.S.
facilities and personnel in the country. The Regional
Security Office (RSO) enjoys a strong working relationship
with Austrian police intelligence units concerning potential
terrorist threats against USG personnel and facilities in
Austria. The degree of support and assistance that the
Austrian authorities provided during the visits of President
Bush and Secretary of State Rice in June 2006 reinforced the
strength of this relationship. RSO also has a functional
liaison with the Nuclear, Biological, and Chemical Defense
Unit of the Austrian Army for timely support in the event of
a nuclear, chemical, or biological attack on Embassy
facilities. Austrian authorities routinely provide
appropriate and quick security support in connection with
anti-U.S. demonstrations near the embassy. In 2006,
demonstrators near the Embassy mainly protested the war in
Iraq, allegations of torture in U.S. military prisons, and
globalization.


36. Post's Legal Attach Office (Legat) has an excellent
working relationship with its Austrian counterparts and
continues to nominate and facilitate training for Austrian
officials at the FBI National Academy. In February 2006, the
director of Austria's Federal Criminal Office (BKA) met with
FBI officers in Washington, San Diego, and New York to
discuss counterterrorism, homeland security, and
transnational organized crime. In April, the Legat hosted a
terrorist finance seminar in Budapest for EU law enforcement
services, including the Austrian BVT. In October, Austria's
Deputy Director for National Security attended a two-week
leadership course at the FBI.


37. The DHS/ICE office in Vienna also continues to work
closely with Austrian law enforcement authorities on joint
investigations, including in the areas of money laundering
and preventing the transfer of WMD and licensable technology
through the region. With direct flights between Vienna and
the United States, the ICE office works with Austrian border
control officials on passport and identity fraud issues on
almost a daily basis.


38. Austria's view toward the HSPD-6 Initiative regarding
the exchange of terrorist screening data remains positive.
Talks with the U.S. progressed this year on concluding a
Memorandum of Understanding (MOU). In November 2006, a team
from the Department of State and the Department of Homeland
Security's Terrorist Screening Center visited the Ministry of
Interior to discuss the proposed MOU. Austria prefers a
simple agreement that would not be legally binding or require
Parliamentary approval. Data protection is another concern,
especially regarding information sharing with third
countries. Austrian officials fear that a new agreement will
jeopardize the level of good cooperation that already exists
with the U.S. for sharing this information.


39. Sharing passenger name record (PNR) data has
traditionally been a sensitive issue for Austria because of
data privacy concerns. Austria reluctantly supports the EU's
draft PNR agreement, but does not actively advocate
broadening its scope.


40. In February, Austria pledged to implement the EU
directive on telecommunications data retention. However,
Austria extended the implementation period to 36 months to
allow small internet providers time to make the necessary
technical changes.

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Renditions Allegations
--------------


41. In November 2006, a report by the EU Parliament on
suspected U.S. renditions in Europe criticized Austria for
not cooperating with its investigation into the possible
kidnappings of an Egyptian physician in 2002, and an East
African computer specialist in early 2003. Both were
long-term residents of Austria. The report alleges that U.S.
authorities abducted the men. Under scrutiny from the media
throughout 2006, the Austrian foreign ministry stressed that
it repeatedly addressed the issue of renditions with the
U.S., including during the June 2006 U.S.-EU Summit in
Vienna. Austria supports the EU position that international
law and human rights standards must be respected and that
illegal renditions are unacceptable. During the Summit,
Austria also called on the U.S. to close the Guantanamo
military prison.

The Road Ahead
--------------


42. The U.S. will continue to support Austrian
counterterrorism efforts, deepen law enforcement cooperation,
and promote a better understanding of U.S. counterterrorism
policy in Austria. Facilitating meetings of U.S. and
Austrian authorities and sponsoring public speaking events on
counterterrorism-related topics remain top priorities. Post
will continue the successful trend of working with Austrian
law enforcement officials to prevent the transfer of
armaments and of sensitive dual-use technologies through the
region.
MCCAW