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export-controls 01 March 2018

EU and US pile on pressure with further sanctions on DPRK

On 27 February, the EU Council upped its sanctions against North Korea (‘DPRK’) by implementing the restrictions in UN Security Council Resolution 2397, which contains the toughest UN sanctions yet against Pyongyang. Resolution 2397 was agreed in December 2017 in the light of Pyongyang’s ‘flagrant disregard’ for previous UN Security Council resolutions concerning its ongoing nuclear and ballistics weapons programme. The EU has already implemented some of the restrictions in Resolution 2397, in January adding 16 people and one entity, the Ministry of the People’s Armed Forces (‘MPAF’), to its list of those sanctioned.

The most recent measures transposed into EU legislation include:

  • An export ban on all refined petroleum products, with the exception of 500,000 barrels per year (reduced from two million);
  • a ban on imports from the DPRK of food and agricultural products, machinery, electrical equipment, earth and stone, and wood;
  • a ban on exports to the DPRK of all industrial machinery, transportation vehicles, and expansion to all iron, steel and other metals;
  • sanctions against vessels suspected of being involved in the breach of UN sanctions; and
  • the requirement to repatriate all DPRK workers abroad within 24 months.

A ban on the export of crude oil contained in Resolution 2397 was introduced by the EU in October 2017.

The UK is also updating its sanctions against DPRK through The Export Control (North Korea Sanctions) Order 2018, which brings the UK into line with EU trade restrictions against North Korea outlined in Council Regulation (EU) no 2017/1509, amended by Council Implementing Regulation (EU) No 2018/87. The order revokes articles 4 to 16 of the Export Control (North Korea Sanctions and Iran, Ivory Coast and Syria Amendment) Order 2017 (SI 2017/18).

On 23 February, the US government announced the ‘toughest ever’ sanctions package against North Korea, in a move which the US Treasury described as ‘aimed at disrupting North Korean shipping and trading companies and vessels to further isolate the regime and advance the U.S. maximum pressure campaign.’

Designated parties include ‘one individual, 27 entities, and 28 vessels located, registered, or flagged in North Korea, China, Singapore, Taiwan, Hong Kong, Marshall Islands, Tanzania, Panama, and Comoros,’ said the Treasury Department’s Office of Foreign Assets Control (‘OFAC’).

OFAC also issued an advisory which includes details of the ‘deceptive shipping practices’ undertaken by North Korea to evade sanctions, including:

  • Physically altering vessel identification
  • Ship to ship transfers at sea to conceal the origin or destination of cargo and
  • Falsifying cargo and vessel documents
  • Disabling and manipulating collision avoidance systems, including AIS (automatic identification systems)

The advisory includes an overview of sanctions related to the maritime industry, and a list of North Korean vessels ‘capable of engaging in ship to ship transfers of petroleum’.

 

For more information on the EU’s measures see:
http://www.consilium.europa.eu/en/press/press-releases/2018/02/26/north-korea-eu-aligns-sanctions-with-latest-un-security-council-resolution/

Export Control (North Korea Sanctions) Order 2018 can be found here:
http://www.legislation.gov.uk/uksi/2018/200/contents/made

For the US sanctions see:
https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20180223.aspx