NETHERLANDS/IRAN: IMPLEMENTING IRAN SANCTIONS

C O N F I D E N T I A L SECTION 01 OF 02 THE HAGUE 000355

SIPDIS

SIPDIS

STATE FOR ISN AND EUR/WE
STATE ALSO FOR EB/ESC/TFS, S/CT, EUR/PGI
TREASURY FOR TFFC AND OFAC

E.O. 12958: DECL: 04/01/2018
TAGS: PREL MNUC KNNP IR UNSC NL
SUBJECT: NETHERLANDS/IRAN: IMPLEMENTING IRAN SANCTIONS

REF: A. GIAQUE GAERC EMAIL 4/18/08


B. SECSTATE 34974

C. SECSTATE 29464

D. SECSTATE 29096

E. THE HAGUE 299

Classified By: CHARGE D'AFFAIRES MICHAEL F. GALLAGHER FOR REASONS 1.5(B
) AND (D)


1. (C) SUMMARY: On April 22, Charge D'Affaires discussed Iran
sanctions with MFA Director for the Middle East and North
Africa, Baroness van Lynden-Leijten, who confirmed continuing
Dutch support for robust implementation of UNSC resolution

1803. At the same time, the Netherlands wants to keep the
dialogue option open. Earlier, Emboffs delivered reftels
B-D, and had received assurances of Dutch intent to implement
Iran sanctions. END SUMMARY.

STRONG COMMITMENT TO IRAN SANCTIONS
--------------


2. (C) Van Lynden-Leijten told Charge on April 22 that with
regards to Iran, the international community needs to be
"beating them with a stick" and show them we are "not pussy
footing around." At the same, the Netherlands wants to keep
the option of dialogue open. Reviewing ref A points on EU
negotiations, Van Lynden-Leijten noted that the Netherlands
is part of the EU group favoring "robust" sanctions. The EU
deliberations on Iran are "done" and there is an agreement in
principle. Asked whether she saw any signs of positive
change in Iran, Van Lynden-Leijten said there were no clear
signs but that it was important to continue with the
"two-track" approach of dialogue and sanctions. (Comment:
While Van Lynden-Leijten supported the U.S. approach on
1803, she also alluded to U.S. extraterritorial laws, asking
how the U.S. overlooked German, Swiss and Italian economic
activities with Iran. End comment.)


3. (C) In an earlier discussion, Dutch MFA officials Loek ten
Hagen, Department of Middle East and North Africa Affairs,
and Jeroen Boender, Department of Political Affairs, stated
that the Slovenian EU presidency has been slow to implement

1803. The Dutch are willing to impose sanctions beyond 1803
if Iran does not comply, but unlike the British, the Dutch do
not want to go beyond the 1803 sanctions without an
additional UNSC resolution.


IMPLEMENTATION OF UNSC resolutions 1737, 1747, 1803
-------------- --------------


4. (C) Dutch implementation of the financial restrictions of
UNSC 1803 (reftel D) are discussed in reftel E. During
April, Poloff held follow-up discussions on reftels B-D with
Ten Hagen and Boender. Boenders and Ten Hagen reviewed
implementation of the student visa provisions of UNSC 1737
and the financial limitations, dual use, asset freeze and
travel ban provisions of UNSC 1803.


5. (C) On student visas, the Netherlands primarily implements
the limits through denial of visas to pursue certain
technical studies. The Dutch will also finalize new rules in
the coming weeks. The Dutch intend to follow the "British
model." First, they will implement stricter limits on access
to nuclear facilities. Second, they will identify technical
studies barred to Iranian citizens without permission of the
intelligence service. Boender indicated the Dutch
universities were cooperating with the government's efforts.


6. (C) Regarding financial limitations, the Dutch can
implement many of the requirements immediately. The Dutch
have no ongoing export promotion projects to stop. The Dutch
will bar any government programs that lead to new
investments. However, the Dutch will not close their trade
office Tehran. The office has a limited role, and urges
investors to "exercise caution." Export credits will in
effect be closed, although there are some ongoing
transactions supported by credits. Given the cumbersome
nature of the new checks, the Dutch expect no new
transactions.


THE HAGUE 00000355 002 OF 002



7. (C) Ten Hagen and Boender echoed concerns of the Dutch
Finance ministry (reftel E),that shutting down Bank Markazi
(Iran's central bank) would be "one step too far." Adding
the current list of banks to the sanctions list was difficult
as it affected 1.5 billion euros in trade and outstanding
debt. However, the Dutch double checked and found Bank
Melli's "hand in the cookie jar" despite the fact that 99% of
its business was legitimate. Trade with Iran is declining.
According to a business contact, it's "almost impossible" to
find a bank to support a deal.


8. (C) Regarding dual use items, embassy shared reftel points
with ten Hagen and Boender at the MFA and Kees Jan Steenhoek,
Senior Policy Adviser at the Ministry of Economic Affairs.
Boender noted that the Netherlands already has a strict
licensing procedure in place for dual use items. However,
following the British model -- pushing for a full ban --
might be difficult for the Netherlands to support.


9. (C) The travel ban and asset freeze are relatively easy to
implement, according to Boender, you just need to "add the
names" to legislation.
Gallagher