Body
We are once again getting leaks about a pending UN Panel of Experts Report. If the earlier reports are any indication, the document will provide useful detail on North Korea’s efforts to circumvent the sanctions regime. But it will also set in train a highly politicized debate among the Five Parties, including particularly the Chinese. Should the report be released (rather than simply leaked)? Should anything be done about the findings? And should the mandate of the Panel be further extended given lack of progress on returning to nuclear and missile negotiations?
We covered the last report in some detail (Part 1, Part 2, Part 3) but it is worth a brief update and reminder of the history. A political Security Council Committee—consisting of the members of the Security Council itself–was established to oversee the implementation of sanctions in October 2006 after the first nuclear test and the passage of UN Security Council Resolution 1718 (2006). After the passage of Resolution 1874 in June 2009, this “1718 Committee” was also given the task of overseeing the wider set of sanctions included in that resolution; the Committee maintains a very useful website with full access to all documents, including national reports.
The Panel of Experts was appointed in August 2009 to provide staff assistance and expertise to the 1718 Committee in carrying out its expanded work agenda. Another resolution (UNSCR 1928 of June 2010),extended the mandate of the Panel until June 2011 and yet another (UNSCR 1985, June 2011) extended it until June 12, 2012. The Panel was required provide a final report to the Committee “no later than thirty days prior to the termination of its mandate” and to submit to the Council its final report “upon termination of the Panel’s mandate.” Unless extended, the news reports we are seeing center on this final report.
In addition to providing reports that detail the effectiveness of the sanctions regime, the Panel has also published technical “Implementation Assistance Notices” to assist member countries in meeting their obligations under the sanctions regime; the third of these, issued in December 2011, for example, outlined obligations with respect to luxury goods trade banned under UNSC 1874.
What are we now hearing? Reuters, which broke the story based on access to the draft report, initially focused on the luxury goods trade. AP also covered the story.
Anecdotal reports from visitors to Pyongyang confirm the report’s key findings: that the luxury goods ban is porous because of conflicting definitions of luxury goods and failure to coordinate. Benzos, watches, booze, $200 tap-dancing shoes.
But the report also contains some more explosive findings even if the information is old, because they implicate Chinese laxity and its continuing role as a transshipment center:
- In April 2012, France reported to the committee that it had inspected and seized an illicit shipment of arms-related materiel in November 2010 originating from the DPRK and destined for Syria.
- Although the report does not find anything with respect to nuclear cooperation, it refers to a recent statement by the speaker of Myanmar's new parliament, Thura Shwe Mann, on the signing of a memorandum of understanding with Pyongyang during a 2008 visit to North Korea. The agreement allegedly included weapons cooperation that would be banned under both 1718 and 1874.
With respect to the sanctions themselves, the April 16 Security Council statement on the missile launch included a directive to designate “additional groups and items” under 1718 and 1874. On May 2, additional items and companies were added to the sanctions lists. The three companies targeted are profiled below to give some sense of the nature of the trading and financial entities involved and the shape-shifting, whack-a-mole nature of the sanctions game.
1. AMROGGANG DEVELOPMENT BANKING CORPORATION
Description: Amroggang, which was established in 2006, is a Tanchon Commercial Bank-related company managed by Tanchon officials. Tanchon plays a role in financing KOMID's sales of ballistic missiles and has also been involved in ballistic missile transactions from KOMID to Iran's Shahid Hemmat Industrial Group (SHIG). Tanchon Commercial Bank was designated by the Committee in April 2009 and is the main DPRK financial entity for sales of conventional arms, ballistic missiles and goods related to the assembly and manufacture of such weapons. KOMID was designated by the Committee in April 2009 and is the DPRK's primary arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons. The Security Council designated SHIG in resolution 1737 (2006) as an entity involved in Iran’s ballistic missile programme.
Location: Tongan-dong, Pyongyang, DPRK
A.K.A.: AMROGGANGDEVELOPMENT BANK; AMNOKKANG DEVELOPMENT BANK
2. GREEN PINE ASSOCIATED CORPORATION
Description: Green Pine Associated Corporation (“Green Pine”) has taken over many of the activities of the Korea Mining Development Trading Corporation (KOMID). KOMID was designated by the Committee in April 2009 and is the DPRK's primary arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons. Green Pine is also responsible for approximately half of the arms and related materiel exported by the DPRK.
Green Pine has been identified for sanctions for exporting arms or related material from North Korea. Green Pine specializes in the production of maritime military craft and armaments, such as submarines, military boats and missile systems, and has exported torpedoes and technical assistance to Iranian defence-related firms.
Location: c/o Reconnaissance General Bureau Headquarters, Hyongjesan-Guyok, Pyongyang, North Korea; Nungrado, Pyongyang, DPRK
A.K.A.: CHO'NGSONG UNITED TRADING COMPANY; CHONGSONG YONHAP; CH'O'NGSONG YO'NHAP; CHOSUN CHAWO'N KAEBAL T'UJA HOESA; JINDALLAE; KU'MHAERYONG COMPANY LTD; NATURAL RESOURCES DEVELOPMENT AND INVESTMENT CORPORATION; SAEINGP'IL COMPANY
3. KOREA HEUNGJIN TRADING COMPANY
Description: The Korea Heungjin Trading Company is used by KOMID for trading purposes. We suspect it has been involved in supplying missile-related goods to Iran’s Shahid Hemmat Industrial Group (SHIG). Heungjin has been associated with KOMID, and, more specifically, KOMID’s procurement office. Heungjin has been used to procure an advanced digital controller with applications in missile design. KOMID was designated by the Committee in April 2009 and is the DPRK's primary arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons. The Security Council designated SHIG in resolution 1737 (2006) as an entity involved in Iran’s ballistic missile programme.
Location: Pyongyang, DPRK
A.K.A.: HUNJIN TRADING CO., KOREA HENJIN TRADING CO., KOREA HENGJIN TRADING COMPANY
