BRAZIL: ADDITIONAL INFORMATION ON IRANIAN

C O N F I D E N T I A L SECTION 01 OF 02 BRASILIA 000752

SIPDIS

SIPDIS

E.O. 12958: DECL: 01/11/2017
TAGS: PREL BR
SUBJECT: BRAZIL: ADDITIONAL INFORMATION ON IRANIAN
PRESENCE AT ARMS SHOW

REF: BRASILIA 705

Classified By: POLITICAL COUNSELOR DENNIS HEARNE. REASONS: 1.4 (B)(D).


1. (C) Per reftel, Mission officers have received additional
and sometimes conflicting information in recent days on the
events surrounding the closing of the Iranian Defense
Industries (DIO) stand at the Latin American Air and Defense
(LAAD) show in Rio on 16-17 April, following the realization
by the Brazilian government and event organizers that the DIO
display was in violation of UNSCR 1747 strictures.
Specifically, it has been difficult for mission officers to
determine the nature of Brazilian government intervention in
the affair, i.e., did the Brazilian foreign or defense
ministeries actually order the closing of the stand directly
or engage with the Iranian Government at any time, or stand
back and leave the closing of the DIO booth to the show's
UK-based events organizing firm, Reed Ltd.?


2. (C) PolCouns has been in contact with British Embassy DCM
Hugo Shorter throughout the DIO-related events, and received
from Shorter on 27 April what we believe is the most detailed
accounting of the episode attainable. The key points of
Shorter's account follow:

--Shorter said that he was contacted by phone at around 1800
on Monday, 16 April, by an official of the Reed events
organizing company who was in Rio preparing for LAAD's
official opening on 17 April. The Reed executive was alarmed
to find an Iranian DIO stand preparing to open at LAAD, a
violation of UNSCR 1747. Shorter was clear in saying that
this alert from the Reed man in Rio was the first information
the British Government had received on Iranian participation
in LAAD.

--Shorter immediately contacted the Brazilian Ministry for
External Relations (MRE) about the development. MRE
Assistant Secretary for International Organizations (and new
UN Permrep-designate) Maria Luiza Viotti called Shorter back
around 2000 in the evening and stated: (1) the MRE had been
unaware of the Iranian presence at LAAD, (2) Brazil's
Ministry of Defense had been informed that evening by MRE and
the Brazilian Chief of Defense Staff had indicated the
Iranian stand would be shut down.

--On the morning of 17 April, Shorter was contacted by Reed
and told Reed directors had ordered the immediate closing of
the Iranian stand. Shorter said it was his understanding
that Reed had taken the action based on corporate decisions
and contact from the Brazilian Defense Ministry. (Note: We
have heard similar accounts from the French and Israeli
ambassadors here, though they indicate a more passive MRE
role vis-a-vis Reed in ordering the closing of the DIO stand.
End note.) Shorter said the British Embassy Defense attache
was at LAAD and reported that some DIO models and brochures
remained out on the floor when the show opened at 1000 am,
but the DIO stand had its electricty shut off and "CLOSED"
signs posted on it before noon, and was clearly out of
commission shortly thereafter.

--During the day on April 17 Shorter spoke twice with Maria
Narazeth Farani, Chief of Staff to Foreign Minister Amorim.
He asked whether the MRE had protested the issue to the
Iranian Government or taken any additional action. Farani
told Shorter adamantly that the GOB had fulfilled its
obligations under the UNSCR by contacting its Defense
Ministry and the event organizer to order the closing of the
DIO stand. Shorter subsequently learned from MRE senior
contacts that Brazil's ambassador in Tehran had been called
in by the GOI to hear its official protest at being invited
to an event and then being shut down, but the GOB Ambassador

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had noted that any invitation had been issued well before
UNSCR 1747 and the GOI must have been aware of the
resolution's ramification. Iran's ambassador in Brasilia
also met with MRE officials to lodge a protest. Both
diplomatic actions were at the Iranians' initiative, not the
GOB's, Shorter noted.

--In a follow-up meeting on 27 April with Santiago Mourao,
the director of the MRE's Directorate for Arms Control and
Sensitive Technology, Shorter asked whether the GOB had taken
or would pursue any action on seizures of DIO assets. Mourao
said Brazil's Central Bank financial crimes investigations
unit (COAF) had not located any DIO financial assets in
Brazil. With regard to the models and brochures at the DIO
stand in Rio, Mourao said these were regarded as financially
inconsequential by the GOB, and had not been seized. Mourao
said the GOB may forward a report on the assets to the UN
sanctions committee.

--Mourao stoutly defended GOB responses in the case, saying
the GOB had worked to shut down the DIO stand as soon as it
was aware of its presence at LAAD. He said the Iranians
should be held responsible for the event, but also noted the
GOB had no indication the GOI had deliberately staged the
event to provoke or embarrass Brazil. The GOB's positions on
Iran's nuclear program are well-known and documented at the
IAEA and the UN, and Iran could have been under no illusion
that the GOB would not honor UNSC requirements, Mourao said.

--In sum, Shorter said the foreign ministry clearly had not
blocked the closing of the DIO stand, though its actions in
coordinating the closure perhaps could have been more direct
and proactive, and it has taken no action on asset seizures.

Chicola