On 12 June 2018 and following the United States withdrawal from the Joint Comprehensive Plan of Action (Iran Nuclear Deal) on 8 May 2018, the UN Secretary General released his fifth report on the implementation of Security Council Resolution 2231 (2015). The UN Secretary General is required to report to the Security Council on the implementation of the resolution every six months. Therefore, this 5th report provides an assessment on the implementation of the resolution since the issuance of the 4th report on 8 December 2017.
Key Findings included:
13 new proposals submitted through the Procurement Channel bringing the total number of submissions to 37
6 cases of illicit procurement activity, which would have required advanced approval by the UN Security Council
Component parts of missile launches fired by the Houthis at Saudi territory were manufactured in Iran, and features of the missiles were consistent with the Qiam-1
Usage of the Procurement Channel
There were 13 proposals submitted through the Procurement Channel to participate in or permit activities with Iran for nuclear or non-nuclear civilian end uses. This figure is up from 8 proposals submitted in the previous reporting period and brings the total number of proposals submitted since Implementation Day (16 January 2016) to 37. Of these 37, 24 proposals have been approved by the Council, 3 have been disapproved, 7 have been withdrawn by the proposing state, and 3 are currently under review.
While more frequently used than in the first year, the number of submissions demonstrates that activity in the procurement channel remains quite low in comparison to expectations, and this is partly due to a lack of awareness by sellers, and in some cases national authorities of its existence.
Procurement of Nuclear-related Dual Use Items
Information was submitted from 2 member states (the United Arab Emirates (UAE) and the United States of America about attempts by Iran to procure apparently-controlled dual-use items outside of the authorised channels Notably four shipments were seized by the UAE while in transit to Iran. The items involved 40 cylindrical segments of tungsten, 1 inductively coupled plasma mass spectrometer, 10 capacitors, and 1 titanium rod. As these materials are control list items governed by the Nuclear Supplier Group Guidelines of Nuclear Related Dual-Use Equipment, they would have required advanced approval by the Security Council in line with the provisions of paragraph 2 of Annex B of resolution 2231 (2015).
U.S. authorities informed the Secretariat that two commodities – carbon fibre and aluminium alloys again governed by the Nuclear Supplier Group Guidelines of Nuclear Related Dual-Use Equipment had been transferred to Iran over the last year without prior approval of the Security Council as would have been required for such items.
Iran responded to the accusation by stating that it was the responsibility of the exporting state to seek approval through the procurement channel. While this is true, the response negates the fact that Iran is required to issue end user certificates for all such items before they are imported to the country so that the Iranian government cannot claim that it was not aware of the imports. As such, the statements in the UNSGs report assert that Iran has violated UNSCR2231 and the JCPOA, albeit in a relatively narrow and technical way.
Ballistic Missile related transfers
In examining 5 of 11 ballistic missile launches (22 July and 4 November 2017, and 19 December 2017 and 5 and 30 January 2018) by Yemen’s Houthi rebels at Saudi territory, the Secretariat found that some component parts in the debris of launches had been manufactured in Iran. Specifically, the Secretariat found that the features of the 5 missiles examined are consistent with those of the Iranian Qiam-1 short-range ballistic missile.
This latter finding supports that of the UN Panel of Experts on Yemen in January 2018, which reported that the Borkan-2H short-range ballistic missile fired at King Khaled International Airport in Riyadh, Saudi Arabia, in November 2017 “was a derived lighter version, designed specifically by the manufacturers of the Qiam-1” missile.
The Secretariat further assessed that the logo on the jet vane actuators matches that of the Iranian entity Shahid Bagheri Industries (S.B.I.), an Iranian entity linked to composite rocket fuel and missile technology. The Secretariat also observed that a printed circuit board was marked with SHIG 6081, where SHIG is an abbreviation for the Shahid Hemmat Industrial Group, reportedly responsible for Iran’s liquid fuelled ballistic missiles.
To read the full report, please click here. The next report of the Secretary General will be issued in December 2018.
On 12 June 2017, the VCDNP, with support from King’s College London, organised an event entitled “JCPOA Procurement Channel: Status and Lessons Learned.” The event was chaired by Laura Rockwood, VCDNP Executive Director, with opening remarks by the Ambassador of the European Union (EU) to the International Organisations in Vienna Didier Lenoir. The speakers included officials actively engaged in the Procurement Channel from the UN Secretariat, the EU External Action Service (EEAS) and the Islamic Republic of Iran. The event was organised under the auspices of the VCDNP’s newly launched European Non-Proliferation and Security Initiative (ENSI); Ian Stewart, who directs the ENSI, also participated.
The event focused attention on an underutilised mechanism of the Joint Comprehensive Plan of Action (JCPOA) intended to ensure that trade in nuclear-related items is consistent with the principles and requirements of the agreement: the JCPOA Procurement Channel.
In her welcoming remarks, Laura Rockwood noted that, a year and a half into the implementation of the JCPOA, it was timely to consider whether the Procurement Channel was living up to its expectations. It was with this in mind that the VCDNP had organised the event.
The JCPOA Procurement Channel includes measures intended to ensure that while Iran is able to benefit from regular trade in the field of single and dual‑use items of nuclear relevance, such items cannot be diverted to support a nuclear programme in Iran inconsistent with the JCPOA. The Procurement Channel is run by the Procurement Channel Working Group (PWG) which is coordinated by the EEAS, and has seven participating States: United Kingdom; the United States of America; France; Germany; Russia; China; and Iran. The channel is designed to receive proposals from States interested in exporting goods to Iran. The PWG has 20 working days (extendable to 30 days) to consider the proposals on any one export good. The PWG operates by consensus and once their decision has been made it is sent to the Security Council for its final decision. The Security Council has five days to make its decision, which is then communicated to the proposing State in the form of a written letter.
In his remarks, Erik Marzolf, Senior Political Affairs Officer in the Security Council Affairs Division of the UN Secretariat, outlined that the JCPOA, was endorsed by the Security Council through resolution 2231 (2015), just six days after the agreement was reached by the E3/EU+3 and Iran. This resolution terminated the provisions of all previous Security Council resolutions on the Iranian nuclear issue and replaced prohibitions with certain restrictions, including on nuclear-related transfers to Iran.
He noted that resolution 2231 generated a distinct working mechanism which differs from that which existed during the sanctions period. In particular, there was no longer a dedicated committee of the Security Council charged with overseeing implementation. Instead, all tasks are directly undertaken by the Security Council and one of its members (on a rotating basis) acts as the facilitator. This year it is Italy, last year it was Spain. The specific role of the Secretariat is to support the facilitator and to report every six months to the Security Council on the implementation of resolution 2231. The Procurement Channel is a system derived and endorsed by the resolution and administratively supported by the UN Secretariat.
Mr. Marzolf noted that the Secretariat acts as the point of contact for States in submitting proposals to the Procurement Channel. He emphasized that the Secretariat is not involved in the substantive review of the proposals. States are encouraged to submit proposals through UN Missions in New York, using the templates available on the UN website in all six official languages. Once proposals have been received, the UN Secretariat is tasked with translating them into English before providing the proposals to the PWG for its consideration. Translations are usually completed within a 24 to 48 hour time period. The proposals are handled in the participating States capitals and the EEAS in Vienna serves as the coordinator. The duration of the review process ranges from 42 and 58 calendar days and to date averages 47 days. Once the outcome of the review is determined, the Secretariat informs the Member State of the decision of the Council. Mr. Marzolf indicated that all proposals submitted thus far had been processed in due time with consideration given to confidentiality.
Klemen Polak of the EU External Action Service and coordinator of the PWG noted that trade with Iran had entered a new era as a result of the JCPOA. The Procurement Channel, he said, had been quickly set up, with the necessary administrative items, such as templates, available as of Implementation Day. The Procurement Working Group has met every third week in Vienna since then and is the only working group under the JCPOA that has regular scheduled meetings.
Mr. Polak also mentioned the need to balance transparency with confidentiality, given that the information provided through the Procurement Channel could involve potential commercial sensitivities. In the spirit of transparency he highlighted that the PWG reports every six months to the Security Council on its review of the proposals. Mr. Polak concluded that to date a positive trend could be seen and it appeared that the Procurement Channel was working properly and that the PWG had provided sufficient information and guidelines for States to submit proposals. He also noted that of the proposals received to date, most included items on the dual-use list, which includes manufacturing equipment such as for the automobile industry. Though the Procurement Channel is working he recognized that it is still a new mechanism and more work needs to be done, especially on a national basis within each participating State.
Dr. Behzad Saberi, Counselor, Permanent Mission of the Islamic Republic of Iran to the International Organisations in Vienna who represents his country in the Procurement Working Group, reflected on the functioning of the Procurement Channel from an Iranian perspective. He noted that the Procurement Channel was one of the last measures to be agreed on in the JCPOA negotiations, due to mutually exclusive principled positions of different parties which were only brought to agreement through creative solutions and flexibility shown by all sides. He clarified that it had taken some time for Iran to set up the internal mechanisms necessary for the issuance of the end user certificates required under the Procurement Channel, and further explained that Iran had now established the Atomic Energy Organisation of Iran as the certifying authority for nuclear items and the Ministry of Industry, Trade and Mine as the certifying authority for non-nuclear civilian end users.
Dr. Saberi noted that the working mechanisms of the Procurement Channel were indeed set up effectively, and with a positive working spirit, but that, to date, too few cases had been referred through the Channel than expected. He elaborated on a number of reasons why he thought the use of the Channel had not yet yielded a greater output. These included, inter alia: (a) the considerable time that inevitably had been needed for setting up the arrangements and working methods related to the Procurement Channel in (and among) the Working Group, the UN, Iran and other participants of the Working Group. He mentioned that before the JCPOA Implementation Day there existed other more pressing priorities, and that therefore serious work on the necessary preparations for the Procurement Channel began only afterwards; (b) the novelty of the mechanism, meaning that States, industries (both in Iran and in the exporting countries), banks and financial institutions would require some time to become aware of the new possibilities and learn how to use it; (c) the fact that cases resulting from commercial transactions could naturally take some time to negotiate; (d) uncertainties among the private sector about re-engaging with Iran, as a result of the “shenanigans, sabotages and actions” by certain governments and interest groups who have retained their mind-set of sanctions and pressure; and (e) the fact that the appetite on the demand side seems to be less than expected. In this regard he highlighted that, for a country that had been under sanctions for a number of years, industries had had to learn either to indigenize the needed technology and become independent from foreign supply, or to modify their production lines to obviate the need for sanctioned items. Therefore, it will take time for such industries to gain trust in the efficiency and sustainability of this new network and to re-structure their planning to include items that may not have been available from abroad before the JCPOA. In his final remarks, he stressed the need for the Procurement Channel to be seen as available to all and as a reliable mechanism. In building this trust, more proposals could filter in through the channel in the future.
The overall sense from the three speakers was that the mechanisms were well‑established but underutilised. Ambassador Lenoir Didier of the EU Delegation in Vienna described the JCPOA as a bright force in an uncertain era and commented that the improving Iranian economy was a positive sign for the JCPOA’s viability. Nonetheless, the JCPOA’s challenges were noted. Ambassador Lenoir highlighted that the JCPOA – and the Procurement Channel in particular – was a technically complex and politically sensitive agreement, which required daily engagement among officials. All speakers noted the positive trend of the channel but also were not blind to the current shortfalls. However, the common belief that the JCPOA and the Procurement Channel are a success and in the best interest of all prevailed, and the speakers highlighted their own entities serious commitment to achieving the results defined in the agreement.
During the discussion period, the question of whether the Procurement Channel was necessary was raised. It was suggested that the Procurement Channel provides a useful additional mechanism for all parties to maintain confidence that Iran, and the other members of the E3/EU+3, are maintaining their commitments to the JCPOA. Further, it was suggested that, given broader geopolitical uncertainties, such additional confidence building measures would be useful in maintaining the JCPOA in the years ahead.
Another participant emphasized the technical nature of the Procurement Channel process, highlighting that the Channel only looks at the technical aspects of the mechanisms and proposals. As long as proposals are consistent with the JCPOA and resolution 2231, there is no reason why such proposals should not be approved. Referring to the 10 year timeframe for the Channel, the participant noted that little outreach could be done in such a short period. Thus, in encouraging States to submit proposals, it is important to recognize that no one State will be “black listed” or shunned should a proposal be denied, but rather the State would be encouraged to re-submit a proposal that is within the technical guidelines defined in both the JCPOA and resolution 2231 so that it could be accepted by the Procurement Working Group and the Security Council.
In concluding, Ian Stewart observed that mechanisms like the Procurement Channel would help to sustain the JCPOA over the next decade, but that it was incumbent on the E3/EU+3, Iran and other parties to secure a longer-term resolution of the issues that the JCPOA sought to address. He noted that, with the newly launched ENSI at the VCDNP, the Center hoped to play a useful role in this context through the organisation of further follow-on events and activities.
More information on the Procurement Channel can be found here.
This event was also featured on the EEAS website here.
North Korea’s development of weapons of mass destruction, missile delivery systems and conventional military equipment continues despite ever increasing international sanctions. It is known that North Korea relies upon trade in and through China to bypass sanctions. A key knowledge gap relates to what apparatus North Korea maintains in China, especially the border region, to facilitate this. An initial study by King’s College London identified a number of findings:
The presence of extensive procurement networks in the Chinese border regions are significant to both North Korea’s economy and support to its military-related programmes, including WMD.
It is assessed that North Korea employs a covert system in its attempts to prevent the activities between North Korea-based entities and suppliers being identified.
The majority of those entities identified in the China border regions were located in Dandong, although significant numbers were also identified in Dalian and Shenyang. The research to date also found potential presence of North Korean-associated companies in other locations within the Chinese border provinces.
Within the cities of Dandong, Dalian and Shenyang many of the entities were found to be collocated suggesting centres for North Korean-related trade, and close proximity to logistic centres.
The nationality of the majority of people identified and associated with the entities in this report are assessed to fall into three basic categories;
Chinese (citizens) business people who trade with North Korean.
Ethnic Koreans of which there are over 2 million who are Chinese citizens living in the border provinces of Jilin, Liaoning and Heilongjiang.
North Korean persons living and/or working in the border regions within China.
From open source information this study has identified a large number of networks/groups that North Korea could potentially use in support of proliferation-related procurement. However, this is considered to be only part of the potential number of entities that exist.
Most of the entities/companies included in international sanctions lists are based in North Korea. So far, of the entities and people identified in this study only two appear in any sanctions list, these being;
Korea Ryonha Machinery Joint Venture Corporation (UNSCR 1718)
Dandong Hongxiang Industrial Development Company Ltd. (US)
A number of companies and individuals identified have been included in UNSCR 1718 PoE reports with the assertion that they have aided North Korean proliferation activity, but have not been included in any sanctions list.
Although this initial study has not identified any new policy recommendations, it has shown that the extent of the problem is potentially far greater than many have previously considered. To have effective sanctions against North Korean proliferation activity cooperation with, and support to, Chinese authorities should be considered.
Many consider the North Korean ideology of Juche (self-reliance) to include science and technology as one of its three priority pillars alongside ideology and the military. Given its prominence, in the late 1990’s the DPRK formulated a plan for science and technology development that included investment and scientific exchanges with foreign countries. North Korea continues to be one of the most closed nations, and acquiring information relating to scientists and their work is no exception. Some technological fields, such as nuclear and military arms technology are considered to be relatively well advanced, but very little is understood regarding any current chemical and biological weapons programmes.
The study by King’s College London aimed to identify where possible scientists that have been recognised through awards and honours for their work in support of North Korea’s ideology and objectives. Specifically those that may be involved in or have conducted research work in support of the DPRK’s suspected chemical and/or biological weapons programmes. Analysis was also conducted in an attempt to identify persons that worked at entities and/or locations suspected of being involved in chemical and/or biological weapons programmes. The findings included;
The Order of Kim Il-sung is the highest order of North Korea, along with the Order of Kim Jong-il. Recipients can be individuals or organizations, who have contributed “outstanding services to the Republic of the Korean nation and communism”.
The People’s Scientist is an award by the People’s Prize Awarding Commission that works directly under the Cabinet of North Korea.
The names of some of the recipients are available but in many cases details of their role, profession and parent organisation are not reported.
The overwhelming trend is not to name scientists associated to nuclear or missile-related programmes who have received awards.
According to a study by ScienceCentral, analysis of publications from North Korea indexed in the Web of Science Core Collection found 318 articles from North Korea mostly in collaboration with other countries. The study also identified that most research results by North Korean researchers have been published in journals in North Korea.
Analysis of data acquired by KCL of over 29,000 papers published in North Korea identified a total of 33 of potential interest. 24 were identified against a list of key terms and a further 9 were identified as topics of potential interest.
In most cases there was no additional information about the authors of these papers, or their parent organisations.
Entity/location analysis of data extracted from open source websites has identified approximately 1200 people linked to entities or locations that are of possible concern. Of those identified, some are award recipients.
Due to its dual use applications chemical and biological research, development and production those involved are possibly more likely to have some public recognition.
On 20 July 2015, the fifteen members of the UN Security Council unanimously passed Security Council Resolution 2231 (S/RES/2231). This resolution endorses a long-term plan agreed by the international community to provide enhanced international monitoring of Iran’s nuclear program and modifications to Iran’s proliferation-sensitive nuclear activities in exchange for relief from sanctions.
The full text of Resolution 2231 can be accessed here.
The UN also maintains a website dedicated to UNSCR2231. It can be accessed here.
What is the Joint Comprehensive Plan of Action?
The Joint Comprehensive Plan of Action (JCPOA) is the long-term plan agreed between Iran and China, France, Germany, Russia, the United States, United Kingdom and European Union (known as the P5+1 or E3+3). It contains a detailed set of obligations to be undertaken by Iran and the E3+3 over the next 25 years in order to manage Iran’s nuclear programme, reduce sanctions on Iran, and improve international cooperation between Iran and the E3+3. The JCPOA will also permit Iran to legally purchase equipment for its nuclear programme under what is known as the procurement channel.
Resolution 2231 and the JCPOA place requirements on all parties involved in the negotiations on Iran’s nuclear programme, and indeed on all other nations. Implementation will be monitored by the United Nations Security Council. The European External Action Service will also play a key role in coordinating the implementation of Resolution 2231 and the JCPOA. The International Atomic Energy Agency (IAEA) will continue to monitor Iran’s obligations under its nuclear safeguards agreement with the IAEA.