TERRORISM FINANCE: EU PROBLEMS DESIGNATING FOUR

C O N F I D E N T I A L SECTION 01 OF 05 BRUSSELS 000517 NOFORN SIPDIS STATE FOR EEB/ESC/TFS, S/CT, IO, L, AND EUR E.O. 12958: DECL: 04/05/2019 TAGS: ETTC KTFN PTER EFIN PREL PINR UNSC KCRM KJUS KHLS, EUN, PK, IN SUBJECT: TERRORISM FINANCE: EU PROBLEMS DESIGNATING FOUR LET OPERATIVES (DEMARCHE RESPONSE AND SUBSEQUENT ACTIONS) REF: A. 2008 STATE 61363 ¶B. SNYDER-JALLORINA EMAIL 10/22/2008 ¶C. LAMBERT-SNYDER EMAIL 5/29/2008 ¶D. 2008 STATE 131885 ¶E. BRUSSELS 41 ¶F. BRUSSELS 101 ¶G. BRUSSELS 492 ¶H. BRUSSELS 494 ¶I. BRUSSELS 493 Classified By: USEU Econ Minister-Counselor Peter H. Chase for reasons 1.4 (b),(d),(e). ¶1. (U) Action Request: Please see paragraph 3. ¶2. (C//NF) SUMMARY AND COMMENT: The European Commission designated four members of Lashkar-e-Tayyiba (LeT) (Ref D) on March 6. This case illustrates three dilemmas impeding U.S.-EU cooperation in countering terrorist financing through UNSCRs 1267 and 1373: -- (a) The EU is currently unwilling to designate Al-Qaida / Taliban linked terrorists on an autonomous (UNSCR 1373) basis. Certain EU member states insist such terrorists first be designated by the UN 1267 committee, and only then added to the EU's UNSCR 1267 designations. This amounts to a policy that "only the UN can say who is Al-Qaida or Taliban and when to take preventive measures." -- (b) A related issue is the EU's increasing caution against adopting U.S. domestic designations via its autonomous designations track. The EU declined our invitation to designate these LeT individuals before the UN listing, which finally occurred only after the Mumbai attacks. -- (c) The EU will no longer adopt new UN Al-Qaida / Taliban designations until they receive the committee's grounds for the decision in hand, which they view as an inherent UN pre-requisite (per UNSCR 1822 reforms) and moreover EU due process requirement (per Kadi and Al Barakaat case judgments). ¶3. (C//NF) On the first issue, USEU recommends that Washington advocate our position on the relationship between UNSCRs 1267 and 1373 in the May 29 U.S.-EU Terrorist Financing Troika meeting. If we convince the Presidency and EU institutional participants of the merits of our position, they could advocate with the rest of the EU that they reconsider the position taken under the French EU Presidency. If this approach fails, we may have to lobby hard in member state capitals to overcome this. The second issue should be explored informally and off-the-record between U.S. and EU sanctions legal experts to see what, if anything, the USG can do to increase the likelihood of EU acceptance of our designations, including through enhanced information-sharing (Ref E). The third issue could be handled by the USG placing holds on future 1267 designations until the statement of case and narrative summary are ready for simultaneous roll-out with the UN designation. Otherwise we can expect the EU to fail to implement such designations until the reasons are provided, diminishing the odds of freezing assets. Septel will provide further analysis referencing other problematic cases. END SUMMARY AND COMMENT. ¶4. (C) This cable formally updates information sent Ref B, which contained the EU French Presidency's formal response to Ref A (see end of cable below). The French Presidency response remains relevant to EU decisions on several other U.S. autonomous designations of Al Qaida / Taliban-linked terrorists (Refs H-J). -------------- BRUSSELS 00000517 002 OF 005 Chronology of U.S.-EU Issues over Four LeT Individuals' Designation -------------- Testing the 1373 vs. 1267 Waters -------------- ¶5. (C) In May 2008, USEU informally drew EU attention to the U.S. domestic designation of the four LeT individuals. A Council Secretariat sanctions staffer informally replied that the four could not be considered for autonomous EU listing because they were linked to the UN-designated Al-Qaida or the Taliban. Therefore the UN would need to list them first, at which point the separate EU law implementing UNSCR 1267 would include them automatically. ¶6. (C) USEU countered that such an interpretation could pose problems in cases where there was political disagreement at UN level, but where Member State governments had sufficient grounds to suspect an Al Qaida / Taliban link for autonomous designation. Wouldn't failure to list quickly under the EU's autonomous process imply a critical gap between the two EU terrorist sanctions legislations? (NOTE: One EU law implements UNSCR 1267 on Al-Qaida/Taliban; the other implements UNSCR 1373 on autonomous terrorist designations. END NOTE.) The Council staffer conceded this point, but doubted the Council "could consider the listing of persons who are clearly members of (or linked to) a 1267 listed group." ¶7. (C) A Commission sanctions staffer, however, separately supported USEU's position, interpreting the EU laws as permitting Al Qaida / Taliban designations under the EU autonomous track prior to UN action. He noted LeT itself was first listed autonomously under the EU autonomous track ("Common Position 931"),then changed to the 1267 track after the group's UN designation. Although he was unaware of any precedent for designating UN-listed groups under the EU's autonomous track authorities, he read CP 2001/931/CFSP Recital 4 and Regulation (EC) No 2580/2001 Recital 15 as "clauses intended to preclude designation" under the autonomous track "in those cases where the 1267 Committee has effectively designated the individual, entity or group proposed for designation. Reason: we want to have legal instruments that leave no doubt as to the correct procedures for exemptions, (redress,) etc., which should include the relevant UN body if there is a UN designation." (NOTE: A Czech Presidency contact recently concurred with this interpretation. From his prior experience, the EU used to allow terrorist designations first via CP 931, then move names to the 1267 track after UN action. He promised to share concerns over the apparent shift in the CP 931 working party political approach with the relevant Czech authorities. END NOTE.) ¶8. (C) In June 2008, USEU formally invited the EU to join us in autonomously listing the four LeT individuals (Ref A). In July 2008, the Council Secretariat sanctions staffer reiterated his prior stance: "Having checked with our Legal Service, they confirmed that in fact groups or persons listed under 1267 would not be listed under CP 931. The same would go for groups or persons which could be potentially listed under 1267 because of a pending proposal. However, such a decision should be made by Member States and not simply taken by us. Therefore they suggested circulating the proposals and let Member States decide in the context of the next review" (by the CP 931 working group, which designates terrorists by consensus). The Council Secretariat dutifully forwarded Ref A to the CP 931 group for consideration. Water Runs Cold -------------- BRUSSELS 00000517 003 OF 005 ¶9. (C) On October 10, 2008, the French EU Presidency formally replied to Ref A via letter (Ref B, transcribed below),confirming the informal position of the Council Secretariat's sanctions unit and Legal Services. The same stance was applied to two more cases (Refs H and I),whereby potential UNSCR 1267 Al-Qaida/Taliban listings were first designated by the U.S. under our domestic procedures due to delays at UN level. ¶10. (C) USEU continued to informally push back, suggesting that this change in EU terrorist designation policy could prove dangerous: Al Qaida and Taliban are top terrorist threats involving the highest shared U.S.-EU foreign policy and national security priorities. The French EU Presidency response implied such terrorists could only be targeted if agreed by UNSC consensus, even should the EU agree the targets warranted autonomous listing. Tragedy Intervenes: Mumbai -------------- ¶11. (C) USEU's concerns gained poignancy with interlocutors when the Mumbai attacks occurred, one month after the EU formally declined to autonomously list the four LeT individuals. The Commission continues to share USEU's opinion that EU law does not preclude autonomous EU action against Al Qaida / Taliban. If the Council continues to disagree, the Commission is willing to threaten new legislation to close the imagined gap definitively. Council Secretariat legal and sanctions contacts have since conceded that the EU should review this policy interpretation. The Council Secretariat has already discussed this point, but without great detail, with the Czech EU Presidency. Meanwhile, Ref J potentially fits the same category. UN Listing: Necessary But Not Sufficient -------------- ¶12. (C) The UN finally designated the four LeT individuals in December 2008 (Ref G). A Commission sanctions staffer alerted visiting U.S. sanctions experts on February 4 that he had discovered the UN listing took place without accompanying statements of reasons. The UN subsequently provided the reasons for the designation via the Czech EU Presidency to the Commission, which then initiated the necessary legislation. On March 6 the Commission finally published the designation in the EU's Official Journal, officially adding the four LeT individuals to the EU's UNSCR 1267 implementation list. Thus any assets held by these LeT individuals in EU countries lacking domestic UNSCR 1267 implementation authority would not have been frozen until nearly a year after the USG took action. -------------- - Text of French EU Presidency Demarche Response (LET individuals, RIHS, Gulf-based AQ, and Venezuela-based Hizballah) -------------- - ¶13. (SBU) USEU English translation; French original follows: Begin USEU English Translation Brussels, 9 October 2008 Madam, Following your letters of 11, 19 and 27 June requesting the European Union to take position on a number of recent designations by the United States of persons and entities suspected of supporting terrorism, I would like to inform you BRUSSELS 00000517 004 OF 005 of the following considerations, subsequent to a discussion inside the competent Council working group charged with these issues. Concerning the four people linked to the LET, the three people linked to the Gulf-based Al Qaida, and the Kuwait-based entity, it appears to be persons and entities who are susceptible to belong to the list established following the resolution 1267 of the UN Security Council. The constant practice, when dealing with the implementation of the resolution 1373 of the UNSC through the European listing of terrorist persons and entities has always been to keep the two sanctions regimes distinct. In this context, the working group considered that these requests were not in its field of competence. On the other hand, concerning the request on the two persons and entities based in Venezuela presumably supporting Hezbollah, the Presidency would appreciate if any additional information could be communicated to the delegations in order to allow a thorough examination in the framework of the criteria of the Common Position 2001/931/CFSP. In this context, elements concerning the exact legal base for the designation of these people and entities would be extremely useful. The Presidency thaks the U.S. Mission, Sincerely Yours End nglish translation; Begin French text: Brxelles, le 09 octobre 2009 Madame, Faisantsuite a vos lettres des 11, 19 et 27 juin dernir demandant a l'Union europeenne de prendre psition sur une serie de designations recentespar les Etats-Unis de personnes et entitessoupconnes de soutenir le terrorisme, je souhate vous informer des considerations suivantes, suite a une discussion du groupe de travail competent du Conseil saisi de cette question. Concernant les quatre personnes lies au LET ainsi que les trios personnes lies a Al Qaida basees dans la region du Golfe et l'entite basee au Koweit, il semble qu'il s'agit de personnes et entites susceptibles de relever de la liste etablie en vertu de la resolution 1267 du Conseil de securite des Nations Unies. La pratique constante s'agissant de la mise en oeuvre de la resolution 1373 du CSNU au travers de la liste europeenne des personnes et entites terroristes a toujours ete de maintenir la distinction entre les deux regimes de sanctions. Dans ce contexte, le groupe de travail a estime que ces demandes n'avaient pas vocation a relever de sa competence. S'agissant par contre de la demande relative aux deux personnes et aux deux entites bases au Venezuela presumes soutenir le Hezbollah, la Presidence souhaiterait que soit porte a la connaissance des delegations toute information complementaire permettant un examen approfondi au regard des criteres de la position commune 2001/931/PESC. Dans ce contexte, des elements sur la base juridique exacte de designation de ces personnes et entites seraient de la plus haute utilite. La Presidence remercie la Mission des Etats-Unis aupres de l'Union europeenne et saisit cette occasion pour lui renouveler les assurances de sa tres haute consideration. Presidence du groupe PC 931 BRUSSELS 00000517 005 OF 005 End French Text. MINIMIZE CONSIDERED MURRAY .