COUNTERPROLIFERATION TASK FORCE PAPERS FOR UAE

S E C R E T SECTION 01 OF 05 STATE 021428 SIPDIS E.O. 12958: DECL: 03/06/2019 TAGS: PARM PREL KNNP MNUC AE SUBJECT: COUNTERPROLIFERATION TASK FORCE PAPERS FOR UAE REF: ABU DHABI 226 Classified By: ISN C.S. Eliot Kang for reasons 1.4 b,c and d -------------- ACTION REQUEST -------------- ¶1. (U) Post is requested to deliver the three Counterproliferation Task Force (CTF) papers in para two to appropriate UAEG officials. Word versions of these papers will be sent via email to Post along with the CTF agenda. End action request. ¶2. (S//REL UAE) Begin CTF Papers: -------------- U.S. ) UAE Counterproliferation Task Force (CTF) Meeting Abu Dhabi, UAE March 19, 2009 Export Controls -------------- Export Control Law We want to commend you on passage of your export control law and stand ready to assist you as you implement it by providing expert level consultations and export control training. We understand that implementing a law can be a challenge, and we welcome a discussion on the status of your efforts on implementation. We have several questions related to your export control law that we would like to discuss with you. -- What has been your experience to date implementing the law? Have you received any requests for export controlled items? If so, can you describe how many, what types, and the intended destination of the items? -- When will the UAE issue implementing regulations, and when will they be publicly available? Will the regulations cover re-exports, transit, transshipment, finance, and brokering? -- We understand that your government is in the process of assigning responsibility for the export control law. What part of your government will be assigned this authority and how will it work with other relevant parts of your government to ensure that the law is effectively implemented and enforced? -- We understand that your government was in the process of updating the national export control list to ensure that it covers all items in the four export control regimes? What is the current status? If not yet in effect, what steps need to be taken to update the control list? -- What is the process for updating the control list over time to ensure it continues to meet international standards? -- How does the UAE plan to educate industry on the provisions of the export control law? Have you initiated any steps or training programs? �00A;-- How does the law provide authority to freeze financial assets related to the financing of proliferation-related exports or transshipments? -- What's the status of your prosecution of the attempted illegal export of zirconium? Are there other similar public cases? -- What information has been publicly released by your government about this case? -- How are you utilizing the control list to target strategic items transshipped in the UAE? -- What authorities does the law provide for disposition of commercial cargo seized under the law? At the March 19 Counterproliferation Task Force meeting, we will propose, as a follow-on to September 2007 workshop on export controls, that we hold another round of expert-level discussions related to the UAE law. The purpose of the workshop is to exchange ideas on best practices on the STATE 00021428 002 OF 005 implementation of export control laws including the drafting of regulations, organizing and staffing a licensing authority, industry outreach, and other areas you would find helpful. At the September 2007 workshop, U.S. export control officials met with members of your Ministries of Justice, Foreign Affairs, Economy, as well as other Ministries that have responsibilities for the implementation of your export control law. We could also include U.S. legal experts to discuss options, under the export control law, for disposal of seized cargo. Export Control-Related Training The United States is committed to providing export control training for your authorities. We would like to know what your training priorities are and how the United States can assist you in that regard. The United States is prepared to conduct training workshops in a number of areas provided below. We believe that the June 2008 training session that was sponsored by your Ministry of Justice was a success, and we look forward to many more successful exchanges. Licensing: Licensing workshops would focus on the basics of organizing and managing an export control licensing system, as well as providing the knowledge, skills, and abilities needed to begin development of a professional corps of licensing officials. The workshops would also stress the importance of updating the control list in order for it to be consistent with international standards. Discussions would also include the rules about when a license is required, procedures for obtaining a license, and timetables for making a license decision. More advanced workshops would include licensing topics, such as catch-all controls, assessing end users/end-uses, technology controls, government review and dispute resolution, transshipment and re-export licensing issues. Industry-Government Relations: Industry-Government workshops would discuss how to effectively develop a transparent system that ensures that industry fully understands the requirements of the export control law. Discussions would focus on educating the business community about the importance of export controls ) including nonproliferation issues, control lists ) especially what constitutes a dual-use item,, how to apply for export licenses, classification of commodities, and compliance with catch-all provisions. Enforcement: Enforcement workshops would build upon the June 2008 two-day prosecutorial training for judges and prosecutors responsible for WMD proliferation-related cases as well as the half-day of investigations training that was conducted for your law enforcement officers. Discussions would include shared experiences, best practices, and challenges in investigating and prosecuting export control violations including the auditing of corporate records during investigations of incidents as well as advanced investigation topics such as undercover operations. Inspection - Interdiction: These workshops would discuss the targeting and examination of imported, exported and transshipped cargo, focusing on the detection of WMD, conventional weapons and related materials that are co-mingled in legitimate manifested cargo. This training will demonstrate targeting techniques and non-intrusive inspection techniques that may be employed to identify contraband and avoid disruption of legal trade. Identifying WMD-Related and Dual-Use Goods These workshops would include discussions on procedures to follow when officials find suspicious items and would cover how to identify dual-use items. Workshops will also familiarize customs inspectors and others associated with enforcing or implementing export controls on WMD-related materials as identified by the international export control regimes and aim to give students a "trained eye" to help them recognize these materials. These workshops also serve the personnel who license transfers of controlled items, in which case the emphasis focused more on understanding the civil and WMD uses of items and less on visual identification of the items. Other related workshops are aimed at familiarizing officials to proliferation threats and the role of nuclear export controls, and training is focused on nuclear/dual-use commodity identification, and end-use and end-user analysis. STATE 00021428 003 OF 005 -------------- U.S. ) UAE Counterproliferation Task Force (CTF) Meeting Abu Dhabi, UAE March 19, 2009 Options for Disposition of Interdicted Cargoes -------------- We would like to discuss with you some possible options for disposition of WMD-related cargoes that you lawfully interdict. We understand that you have also discussed this issue with other parts of the U.S. Government, and we stand ready to assist in a way that makes the most sense to you and are prepared to work it in whatever channel you prefer. We are prepared to engage supplier or intermediary states to have cargoes of concern recalled, or to facilitate the transfer of cargoes. We also can offer assistance for disposal of cargoes, including technical assistance to physically dispose of hazardous cargoes. Consideration of all of these options would, of course, depend on whether they are consistent with Emirati law, as well as any applicable international law and authorities. We therefore would welcome discussion on whether your laws and authorities would permit pursuing these options. You also may recall that we proposed establishing a working group to consider disposition options. Our proposal still stands, and we welcome your thoughts on this matter. We would be prepared to bring our legal experts to discuss the U.S. authorities in this regard once this working group is convened. Possible Options Diplomatic Assistance with Supplier Recalls: USG can make diplomatic requests to supplier and intermediary governments and firms asking that they recall interdicted cargoes. Diplomatic approaches, as well as their probability for success, will differ depending on (a) whether the supplier or intermediary country is an ally or cooperative state; (b) whether the transfer involves a commodity that is controlled under international export control regimes or violates UNSCRs; and (c) whether the commodity is clearly linked to WMD or is a dual-use item with WMD applications. Funding for and Technical Assistance with Physical Disposal: If there is authority under Emirati domestic law and any applicable international law and authorities for the UAE to seize the interdicted cargo, the USG may be able to provide technical assistance with the physical disposal of interdicted cargoes, to include technical assistance for the destruction/neutralization of cargoes determined to be hazardous or for which there is little or no likelihood that other legitimate uses or recipients can be found in a reasonable amount of time, to the extent consistent with Emirati domestic law and any applicable international law and authorities. USG Removal, Transfer, and/or Storage of Interdicted Cargoes: If there is authority under Emirati domestic law and any applicable international law and authorities for the UAE to seize the interdicted cargo, the USG may be able, consistent with U.S. law and subject to the availability of appropriated funds, to facilitate other actions to dispose of such cargo. Disposal options include removing the cargo from Emirati territory; taking physical possession of the cargo for storage at a U.S. facility or in the U.S. itself; and facilitating the sale or transfer of the cargo to a party other than the supplier or originally intended end-user. -------------- U.S. ) UAE Counterproliferation Task Force (CTF) Meeting Abu Dhabi, UAE March 19, 2009 U.S. ) UAE Counterproliferation Cooperation -------------- We appreciate the strong ongoing cooperation between our countries in confronting the proliferation of weapons of mass destruction, related materials, and the exploitation of the international financial system by proliferators. We also applaud your efforts in passing and implementing an export control law ) a critical element of your national security. For our discussion on March 19, we have listed various proliferation cases that we have discussed with you in the past. In general, we would like to discuss the results of your investigations. In addition, we hope to explore issues associated with the disposition of cargo in general and consider possible solutions. Please see the separate paper on the Options for Disposition of Interdicted Cargoes. STATE 00021428 004 OF 005 Interdictions M/V ANNA E (January 2008 shipment of anhydrous hydrogen fluoride). In January 2008, the USG approached Emirati officials in diplomatic channels to share information regarding a shipment of anhydrous hydrogen fluoride (AHF) from Laem Chebang, Thailand to Bandar Abbas, Iran via Dubai. The cargo was shipped by Thai shipping firm Power Marine, Ltd. to an unknown Iranian end user. AHF is a chemical weapons precursor and is controlled by the Australia Group. It also has nuclear applications, and can be used to produce uranium hexafluoride, the feed-stock for Iran,s centrifuge uranium enrichment program. Emirati authorities seized the cargo, and it remains in UAEG custody. Upon further investigation, the USG received information that the cargo was of South Korean origin. South Korean officials provided the USG with information indicating that the Thai firm Waris Unitrary purchased the AHF from the South Korean firm Foo Sung Corporation. Waris Unitrary provided false end user information indicating that the cargo would be used in Thailand and would not be re-exported. The USG has demarched Thai officials on several occasions requesting that the cargo be recalled. While Waris Unitrary is willing to work with the UAEG to have the shipment recalled, they have been slow in taking steps toward this end. The USG recently demarched Thailand once again, requesting that the cargo be recalled. However, Thai officials noted that they lack the authority to compel Waris Unitrary to recall the shipment. M/V SINOTRANS QINGDAO (2007 shipment of steel tubes from China,s North Wanxing International Corporation to Iran,s Defense Industries Organization). In September 2007, the USG provided information to Emirati authorities about a shipment of steel tubes from China,s North Wanxing International Corporation to Iran,s Defense Industries Organization (DIO). DIO is an entity designated in United Nations Security Council Resolution (UNSCR) 1737 for its involvement in Iran,s nuclear and missile-related activities. Emirati authorities offloaded the cargo and provided photos. The USG subsequently demarched China and requested the shipment be recalled. However, Chinese officials stated that the cargo violated neither Chinese laws nor China,s obligations under applicable UN Security Council resolutions. As of March 2009, the cargo remains in Dubai. YM ENERGY (2007 shipment of chromium-alloy cold-drawn seamless steel tubes from China to Iran). In September 2007, the USG provided information, via diplomatic channels, to Emirati authorities regarding a shipment of chromium-alloy cold-drawn seamless steel tubes from China to Iran aboard the Liberian-flagged vessel YM ENERGY. The cargo was shipped by China,s Yang Ming Marine Shipping, and was destined for Iran,s Shahid Hemmat Industrial Group (SHIG),which is responsible for Iran,s liquid-propellant missile program. SHIG is designated in UNSCR 1737 for its involvement in Iran,s missile program. Emirati authorities offloaded the cargo, and continue to detain it. The USG has demarched China, requesting that the cargo be recalled. However, the cargo remains in the UAE. Chemical and Biological We remain extremely concerned that Iran and Syria are using companies in the UAE to evade U.S. trade prohibitions as well as the export control regulations of other countries to acquire chemical and biological warfare (CBW)-useful equipment and technology. Part of their modus operandi is to hide procurement under the guise of legitimate pharmaceutical or other transactions. Below, we have listed the cases that we have discussed with you beginning in 2004. Cinnagen: In 2004 and 2006, we alerted your government that the Iranian entity Cinnagen, Inc. was establishing a factory in the UAE in order to evade the U.S. embargo on trade with Iran and to possibly acquire U.S.-origin equipment or technology. Al Mazroui Medical and Chemical Supplies: In 2005 and 2006, we shared with your government information concerning the UAE firm Al Mazroui Medical and Chemical Supplies, (AMMCS) provision of biological warfare-useful equipment for Syrian scientific research organizations and their intermediary. Your State Security Directorate responded in August 2005 by requesting further information on AMMCS, activities. We do not have additional information to provide on this case. STATE 00021428 005 OF 005 Petro Plast International LLC: In 2007, we shared with your government that the UAE company Petro Plast International LLC assisted in the transfer of glass-lined chemical reactors and condensers from China to Iran. Our understanding is that in September 2007, your government requested an investigation into the trans-shipment these items. Missile Korean Mining Development Corporation (KOMID): In July 2008, we shared with you information indicating that North Korea,s primary weapons trading firm, the Korean Mining Development Corporation (KOMID),was working to acquire a visa so that its representative could travel to the UAE. Our information indicated that the individual seeking this visa had been associated with KOMID,s assistance to Iran,s missile program and we are concerned that he was traveling to the UAE to promote missile-related cooperation between KOMID and your government. We also raised our concerns that a delegation from the UAE traveled to North Korea from August 16-20 for meetings with KOMID. We understood that this delegation included an individual named Mohammad Ahmad Hassan Abdulla al Mehairi, who is an officer in the UAE armed forces. Noor Aerospace Technologies: In April 2008, we raised with you our concerns that the UAE-based aerospace firm Noor Aerospace Technologies was working to supply the Iran Aircraft Manufacturing Industries (HESA) with several types of jet engines and that HESA plans to use these engines in unmanned aerial vehicle (UAV) applications. We understood that Noor Aerospace Technologies intended to falsify export licensing documents identifying these engines and their ultimate destination to facilitate their transfer to Iran. We believe the jet engines to be supplied by Noor Aerospace Technologies were controlled by the Missile Technology Control Regime (MTCR) and prohibited from being transferred to Iran under UNSCR 1737. Golden Triangle Testing Equipment: In July 2008, we informed you that the UAE firm Golden Triangle Testing Equipment L.L.C. had expressed interest in procuring fifty Swiss-origin machine tools on behalf of an Iranian end-user. The machines sought by Golden Triangle Testing Equipment are controlled by the Nuclear Suppliers Group (NSG) and the Wassenaar Arrangement and well-suited to manufacturing ballistic missile components such as impellers and turbine blades. Alkaen Equipment and Industrial Supplies LLC: In December 2008, we informed you that the UAE-based firm Alkaen Equipment and Industrial Supplies LLC provided Iran's Farazeh Equipment Distributor Company (FEDCO) with approximately $150,000 worth of products, including crystal oscillators, supplied by the Swiss firm Quartzcom Ltd. FEDCO has supplied sensitive goods to entities affiliated with Iran's ballistic missile and unmanned aerial vehicle program. Crystal oscillators are not controlled but can be used in ballistic missile and unmanned aerial vehicle applications. We believe that Alkaen was used as an intermediary in order to conceal from Swiss export control officials that the end user was Iranian entity. In response to a request from your government, we are working to determine whether there are additional details that we can provide you regarding this transaction. End CTF Papers. -------------- POINT OF CONTACT -------------- ¶3. (U) Department point of contact for follow-up is Chris Herrington ISN/CPI 647-5035. CLINTON