CWC: INDUSTRY SPECIFIC MEETINGS ON THE MARGINS OF

UNCLAS THE HAGUE 001025

SENSITIVE
SIPDIS

STATE FOR ISN/CB, VCI/CCA, L/NPV, IO/MPR,
SECDEF FOR OSD/GSA/CN,CP>
JOINT STAFF FOR DD PMA-A FOR WTC
COMMERCE FOR BIS (ROBERTS AND DENYER)
NSC FOR FLY
WINPAC FOR WALTER

E.O. 12958: N/A
TAGS: PARM PREL CWC
SUBJECT: CWC: INDUSTRY SPECIFIC MEETINGS ON THE MARGINS OF
THE CONFERENCE OF STATES PARTIES

REF: A. THE HAGUE 1015

B. THE HAGUE 1021

C. THE HAGUE 977

This is CWC-62-08.

--------------
SUMMARY
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1. (SBU) Before and during the Conference of the
States Parties (CSP 13),Doug Brown, visiting
Director of the Treaty Compliance Division of the
Bureau of Industry and Security, Department of
Commerce, met with a number of officials on industry-
specific issues. This cable follows the wrap up
report for the Conference (ref A) and other sidebar
meetings on a variety of topics (ref B).

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Meeting with Bill Kane, Industry Verification
--------------


2. (SBU) On November 27, Commerce Director Doug Brown
and Delrep met with Bill Kane (Head, Industry
Verification Branch of the Technical Secretariat) to
discuss issues related to industry inspections in the
U.S. Kane asked whether the U.S. might entertain the
idea of sequential inspections to sites more than 150
miles apart; Brown said that this would be evaluated
on a case by case basis and would be dependent on
location, terrain, and other factors. Brown noted
that the U.S. has received an unusually high number
of Schedule 3 inspections this year. Kane explained
that, given the overall number and location of
Schedule 3 plant sites, soon only the U.S. and China
will have Schedule 3 sites that have not yet been
inspected. Brown noted that the number of Other
Chemical Production Facility (OCPF) inspections in
the U.S. has also risen this year; Kane pointed out
that China, Japan, and others with sizeable chemical
industries have also seen an increase. There was
some discussion of the fact that the U.S. and others
could reach their OCPF/Schedule 3 inspection cap in
the coming years.


3. (SBU) On OCPF site selection, Kane pointed out
that previous consultations had failed to reach
agreement and that the Director-General (DG) --
partly at U.S. urging -- had then implemented a new
methodology, based on factors that were within the
Secretariat's purview to change. Kane and Brown
discussed the possibility of member states revisiting
the third selection factor (States Parties'
proposals) after the Technical Secretariat (TS) has
presented its analysis of the first year using the
new methodology, and agreed that it is important that
all States Parties with relevant chemical industries
experience an increase.


4. (SBU) Brown raised the U.S. experience with
sampling and analysis on Schedule 2 inspections, and
recommended that the inspection teams move beyond
simply citing the treaty as justification for
sampling, and begin presenting a sound rationale for
why/where they have decided to take a sample. He
noted that industry representatives are far more
receptive to OPCW inspections when they see
thoughtful analysis and justification from the
inspection teams. Brown also pointed to the benefit
the Secretariat could experience in engaging in such
a dialogue, as they would be pressed for such
reasoning on Schedule 3 or challenge inspections.


5. (SBU) Kane replied that the purpose of the "start-
up" phase of sampling and analysis was to give the
Qup" phase of sampling and analysis was to give the
Secretariat practical experience, and that a major TS

concern with discussing the rationale for sampling
was that it would then be seen as negotiable, which
contradicts the Secretariat's interpretation of the
treaty. Brown suggested that it might be useful to
consider an agreement between the TS and the U.S.
National Authority that justification would be
provided on U.S. inspections for the benefit of both
parties.


6. (SBU) On the issue of "false positives" on
sampling and analysis inspections, Kane noted that
the Secretariat does its best to simulate possible
chemistry at the site (through both a literature
search and lab work) to prepare inspection teams for
possible results. Brown said that, despite the U.S.
site having been pressured into running the OPCW
software in "open mode" on the last inspection, the
Department of Commerce expects to insist upon
"blinded mode" next time. He also shared the
concerns Commerce has with the possibility that the
OPCW will begin taking a "semi-quantitative" approach
to sampling and analysis, a suggestion Kane said came
from Germany in an attempt to address the issue of
false positives. Kane suggested that perhaps someone
from Commerce could explore this further with the TS
before it is deployed.


7. (SBU) Brown also raised the U.S. proposal to use
one "catch all" product group code for chemicals of
lower relevance, as introduced during the November
Industry Cluster consultations (ref C). Kane said
that the TS concern was that this moves in the
direction of providing less information on the sites,
and that these chemicals are common enough that their
identification is unlikely to reveal confidential
business information. Finally, Brown noted that the
Secretariat should, in general, be looking at and
evaluating features of sites more carefully on
industry inspections.

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Meetings with Gary Mallard, Head of the OPCW
Laboratory
--------------


8. (U) On December 2, Brown and Delreps met with Gary
Mallard (Head, OPCW Lab) to follow up on an earlier
discussion of "false positives" in OPCW analysis of
samples taken on Schedule 2 inspections. Mallard
demonstrated the analytical software on a laptop, and
said that the TS hopes to have new software by mid-
January that will allow access to an extended
spectral library from "blinded mode". He clarified
that with the new software, the TS will conduct all
sampling and analysis in "blinded mode" with recourse
to the database. Mallard also explained that the
point of a quantitative analysis of undeclared
scheduled chemicals would be to confirm that these
chemicals were only present in trace amounts as
impurities and did not exceed the declaration
threshold. He admitted that the uncertainty on
concentration measurement would be quite high (plus
or minus 10%),but thought that a valid distinction
could still be made between impurities and chemicals
that should have been declared.


9. (U) Mallard reiterated that most false positives
are due to the presence of routine degradation
products, and commented that the Policy-making Organs
Qproducts, and commented that the Policy-making Organs
lacked the political will to include spectra for
these chemicals. Delrep noted that the U.S. Del was
only aware of one State Party (India) currently
blocking these spectra from being added; Mallard
replied that there was likely to be resistance even
within the Western Group (WEOG).

--------------

Meeting with Giuseppe Cornacchia on Low
Concentrations
--------------


10. (SBU) On December 4, Brown and Delrep were
approached by Italian delegate Giuseppe Cornacchia,
the new facilitator for Low Concentrations.
Cornacchia implied that the U.S. was almost isolated
on this issue, and noted that even Iran favors a
lower concentration limit (1%),which seemed to him
to belie Iran's non-proliferation stance at the OPCW.
Cornacchia also indicated his exasperation with the
Japanese position on the issue. Brown reiterated the
rationale for the U.S. position and the difficulty
the U.S. would have in implementing anything other
than its proposed solution of 10%. In reply,
Cornacchia questioned how U.S. regulations could be
considered to be compliant with the Convention. He
noted that the issue of low concentrations had
implications for other issues, and pressed the U.S.
to consider moving to a limit of 5%. In closing, he
said that, following his first round of
consultations, he sensed flexibility from a number of
interested States Parties, but no commitment yet.

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Bilateral Meeting with the Indian Delegation
--------------


11. (SBU) On December 5, Brown, ISN/CB Office
Director Mikulak, and Delreps met with the Indian
delegation to discuss industry-related issues.
Indian participants were Mr. V.S. Sampath (Secretary,
Department of Chemicals and Petrochemicals, Ministry
of Chemicals and Fertilizers),Ms. Ajanta Dayalan
(Joint Secretary of the National Authority),and Dr.
Pankaj Sharma (Indian delegation in The Hague). The
Indian delegation expressed its willingness to
broaden the dialogue on chemical industry, and not
limit discussions simply to treaty obligations. (DEL
COMMENT: U.S. Del initiated these bilaterals to gain
a better understanding of Indian reluctance on a
number of issues and in the hope of moderating these
positions over time. END COMMENT.)


12. (SBU) Sampath explained that in the Indian
government, the National Authority (NA) is attached
to the Cabinet Office, rather than to a specific
ministry. In response to a question regarding NA
communication with chemical industry, he said that
the NA outreach is similar to that used by the U.S.,
but explained that India has a number of different
chemical associations for different types of
chemicals, as well as at the federal and state
levels. The main association, however, is the Indian
Chemistry Council. Because conflicts can occur
between smaller associations, the Indian NA cannot
confine its outreach to one umbrella association.
Outreach is also conducted through state-level
workshops, which can be particularly effective in
states where a greater percentage of industry is
concentrated.


13. (SBU) Mikulak asked what industry issues were of
particular importance to India. Dayalan listed the
enhancement of OCPF declarations, the OPCW Central
Analytical Database, and OCPF site selection as the
main topics of interest, adding that principled
issues related to risk assessment and the number and
Qissues related to risk assessment and the number and
frequency of inspections were important as well.
Mikulak noted that global chemical industry has
undergone significant changes since the treaty was
signed, as has the global security environment, and
that the future non-proliferation role of the
Organization was very important. Dayalan pointed to
the continuing application of the original treaty
provisions regardless of changes or completion of

chemical weapons destruction, and listed Articles X
and XI as areas of the Convention that could use
further development.


14. (SBU) Mikulak explained that an area of
increasing/future importance for the U.S. is the idea
of using the OPCW as a forum for discussion of issues
related to chemical safety and security. He noted
the importance and utility of exchanging information
and benefiting from others' experience. Delrep
Weekman added that these issues are important to all
regional groups, and that the time seems right to
expand this discussion, and to this end perhaps even
to use the Open Ended Working Group on Terrorism more
effectively. He outlined the U.S. redlines on the
role of the OPCW in this respect, offering assurance
that the U.S. does not see the OPCW Technical
Secretariat taking on an increased role or
responsibility in this area. Weekman also noted that
there could be opportunities for work within an
Article X or XI framework, and that the OPCW Office
of Special Projects was also exploring this.


15. (SBU) Dayalan stated that this issue would
require careful consideration, as safety and security
is a State Party responsibility. She also cautioned
that issues tend to gain their own momentum and that,
while the goal was laudable, it might prove very
difficult to keep the Technical Secretariat from
assuming a more independent role. She suggested
working bilaterally instead.


16. (SBU) On the subject of the inclusion of
additional spectra (for analytical derivatives and
degradation products of scheduled chemicals) in the
OPCW Central Analytical Database (OCAD),Dayalan
stated India's view that the OCAD should only contain
scheduled chemicals. She noted that the OCAD
currently contains only 5,000 of the estimated
100,000 possible scheduled chemicals, and that the
OPCW should focus on filling this gap before
attempting to add chemicals not covered in the
Convention. She also explained India's "compromise
solution" to use only scheduled chemicals on Article
VI inspections and develop a separate database for
use on challenge inspections or investigations of
alleged use that could contain other chemicals.
Mikulak asked what the Secretariat's reaction to this
had been; Dayalan said the TS was still considering
the proposal. (DEL NOTE: Prior to EC-54, OPCW Head
of Laboratory Gary Mallard shared a copy of a TS
proposal based on this suggestion with the U.S. Del.
Del expressed U.S. concerns, shared by the UK, at
this approach and worked to ensure the TS did not
circulate the document. END NOTE)


17. (SBU) Mikulak noted that the U.S. has concerns
with TS sampling and analysis procedures, but
believes it is essential for the OCAD to include
analytical derivatives for scheduled chemicals. He
noted that, in fact, the OCAD already contains some
analytical derivatives that are not scheduled
chemicals themselves. He noted the Technical
Secretariat's desire to introduce additional
analytical derivatives that would improve their
analytical capabilities for scheduled chemicals.


18. (SBU) Dayalan responded that the CWC Schedules of
Q18. (SBU) Dayalan responded that the CWC Schedules of
Chemicals already contain precursors and "marker
chemicals." She explained that, as opposed to
analytical derivatives, these marker chemicals
indicate the presence of specific toxic substances.
Mikulak suggested that India and the U.S. exchange
papers on this topic, and that it would be helpful if
India was willing to identify these chemicals for the
U.S. (DEL COMMENT: U.S. experts do not understand
what the Indians mean by "marker chemicals" on the

schedules that are neither agents nor precursors.
END COMMENT)


19. (SBU) On current attempts to focus OCPF
inspections on more relevant facilities, Sampath
noted that one view is that OCPFs themselves are not
relevant, as the focus of OCPF inspections is the
facility as opposed to the chemical being produced.
Dayalan added that the Secretariat paper on this
topic was confusing and had nothing to do with the
issue at hand.


20. (U) Javits sends.
CULBERTSON