About Damn Time: Treasury sanctions 2 N. Korean companies, 18 ships over Chong Chon Gang (updated)

More than a year after Panamanian authorities uncovered a massive shipment of Cuban weapons on its way to North Korea, in clear violation of multiple U.N. Security Council resolutions, the U.N. and Treasury have finally done something about it. That something could contain the makings of one part of an effective sanctions strategy, but it will still probably disappoint some powerful members of Congress in both parties.

As I noted yesterday, and after public criticism by former head U.N. sanctions expert Martin Uden that the U.N. had been slow to respond to the Chon Chong Gang incident, the U.N. Sanctions Committee finally got around to designating a single entity — Vladivostok-based Ocean Maritime Management (OMM), the shipping agent for the arms deal. The U.N. failed to designate other involved entities, including Singapore-based Chinpo Shipping, conveniently co-located with the local North Korean embassy, or any of the Cuban entities involved in the deal.

I wrote yesterday morning that the U.N.’s decision would probably force Treasury to designate OMM, and that prediction was proven correct within hours of my posting. Treasury also designated Chongchongang Shipping Company, evidently a one-ship enterprise, but it declined to strike at Kim Jong Un’s Chinpo.*

At this hour, there’s still no word from Vladimir Putin about whether he intends to comply with U.N. sanctions, close down OMM, and force it to move to Conakry or Dar-es-Salaam under a new name.

The more interesting part of yesterday’s Treasury announcement was treated as an afterthought in reports from Reuters, The Wall Street Journal, and Yonhap — the designation of 18 North Korean merchant ships. A cursory examination of NK News’s North Korea shipping tracker, however, reveals that this is a significant percentage of North Korea’s merchant fleet.

Better yet, one of the ships designated was the OMM-linked M/V Mu Du Bong, which sits stranded in a Mexican port after returning from Cuba. The designation signals that the U.S. government may ask Mexican authorities to search the ship, as I urged in this post.

The authority for the designations was Executive Order 13551, which authorizes sanctions against —

(ii) any person determined by the Secretary of the Treasury, in consultation with the Secretary of State:

    (A) to have, directly or indirectly, imported, exported, or reexported to, into, or from North Korea any arms or related materiel;

   (B) to have, directly or indirectly, provided training, advice, or other services or assistance, or engaged in financial transactions, related to the manufacture, maintenance, or use of any arms or related materiel to be imported, exported, or reexported to, into, or from North Korea, or following their importation, exportation, or reexportation to, into, or from North Korea;

The designation of a ship makes it difficult for the vessel obtain insurance, repairs, fuel, and other bunkering services that it needs to operate. Similar sanctions have been reasonably effective against the Iranian tanker fleet. The inclusion of the vessels’ IMO numbers will make it difficult for North Korea to evade sanctions by constantly reflagging its ships, something it is notorious for.

The vast majority of North Korea’s shipping traffic is with China. It remains to be seen whether these ships will continue to ply their trade across the Yellow Sea. It will be worth watching that shipping tracker carefully in the coming weeks.

Expect North Korea to adapt by switching off the transponders on its ships. An interesting question I haven’t researched (but perhaps commenter David knows) is whether a U.S. Navy vessel encountering a Treasury-designated vessel on its way to, say, Bandar Abbas with its transponder and its lights switched off has a right to search it at sea.

In February, Hugh Griffiths and Lawrence Dermody of the Stockholm International Peace Research Institute wrote a very interesting analysis of how sanctions against North Korean shipping companies could be an effective tool against smuggling and proliferation.

Treasury’s action raises the number of designated North Korean entities from 43 to 63, still far less than Zimbabwe or Belarus, whether you measure that in terms of raw numbers or the significance of the designations themselves. Yesterday’s designations closed that gap just a bit, and sent the message that at least North Korea isn’t absolutely immune from all its bad acts — just that genocide stuff.

If expanded, sanctions against North Korean ships could make it more difficult (but not impossible) to smuggle arms by relying on third-country vessels. And of course, there’s always Chinese airspace. If enforced aggressively, shipping sanctions could complement expanded financial sanctions to pressure North Korea and deny it one means to proliferate.

The Administration’s failure to designate any Cuban entities, however, will not please the eight members of Congress who recently signed a letter to our U.N. Ambassador, noted genocide-prevention expert Samantha Power, calling on her to push the Security Council to designate “Cuban officials and entities involved in arms smuggling to North Korea.” 

Whether Power pushed for sanctions against North Korea’s Cuban vendors isn’t clear, but it’s clear the U.N. isn’t going to impose them. The Panel of Experts’ report on the Chong Chon Gang incident didn’t find the evidence against Cuban entities to be as strong as it was against North Korea, mainly because the Cubans didn’t cooperate with the POE, and because it wasn’t their ship that was caught in the act. It’s a well-recognized principle in the law** that when a party hides evidence, fact-finders are entitled to make adverse inferences about just what party is hiding. And designating North Korea’s co-conspirators sends an important message to governments like those in Ethiopia, Somalia, Congo, and Tanzania, which were named in previous U.N. POE reports as suspected North Korean arms clients.

Most of the letter’s signatories are members of the House Foreign Affairs Committee. All but one, Rep. Albio Sires of New Jersey, are Republicans. Sires is also one of Congress’s strongest advocates of human rights in North Korea, and is said to be a close ally of New Jersey’s senior senator, Robert Menendez, the Chairman of the Senate Foreign Relations Committee. Both Sires and Menendez are conservative Cuban-American Democrats.

(While I’m on the topic of Menendez, I have to ask whether the ultra-conservative bloggers who may have been taken in by a Cuban government smear operation against Menendez would really prefer to have Barbara Boxer as Chair of SFRC. Don’t get me wrong — Boxer has a great reputation on human rights, but on national security issues, she isn’t nearly as tough-minded as Menendez. For that matter, neither was Richard Lugar — not by a mile.)

The Chong Chon Gang incident was an opening for North Korea human rights activists to reach out to Cuban-Americans in both parties. The Cuban-American contingent in Congress is one of the most powerful on the Hill, and also includes rising Republican star Senator Marco Rubio, and firebrand Congresswoman Ileana Ros-Lehtinen. And if powerful constituencies matter, last week’s revelation that North Korea is selling rockets to Hamas won’t help Pyongyang’s position on Capitol Hill.

The letter is the latest sign that Congress is increasingly uncomfortable with the pace of the Obama Administration’s enforcement of U.N. sanctions against North Korea. In light of these new developments, these members of Congress should consider calling for additional EO 13551 designations of the Cuban entities involved in Chong Chon Gang.

I’ve pasted a list of Treasury’s new designations below the fold.

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* The Editor preemptively apologizes for this.

** The obvious exception is that in criminal cases, no adverse inference can be drawn from a suspect’s invocation of his right to remain silent. 

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Update, 1 Aug 2014: It’s starting to look good for my prediction that the Cuban-American reaction would be fierce. Capitol Hill Cubans has a furious reaction to Cuba’s omission from the list of designated entities.

The following entities have been added to OFAC’s SDN List:

CHONGCHONGANG SHIPPING COMPANY LIMITED (a.k.a. CHONG CHON GANG SHIPPING CO. LTD; a.k.a. CHONGCHONGANG SHIPPING CO LTD), 817, Haeun, Donghung-dong, Central District, Pyongyang, Korea, North; 817, Haeun, Tonghun-dong, Chung-gu, Pyongyang, Korea, North; Identification Number IMO 5342883 [DPRK].

OCEAN MARITIME MANAGEMENT COMPANY LIMITED (a.k.a. EAST SEA SHIPPING COMPANY), Dongheung-dong Changgwang Street, Chung-ku, PO Box 125, Pyongyang, Korea, North; Donghung Dong, Central District, PO Box 120, Pyongyang, Korea, North; No. 10, 10th Floor, Unit 1, Wu Wu Lu 32-1, Zhong Shan Qu, Dalian City, Liaoning Province, China; 22 Jin Cheng Jie, Zhong Shan Qu, Dalian City, Liaoning Province, China; 43-39 Lugovaya, Vladivostok, Russia; CPO Box 120, Tonghung-dong, Chung-gu, Pyongyang, Korea, North; Bangkok, Thailand; Lima, Peru; Port Said, Egypt; Singapore; Brazil; Identification Number IMO 1790183 [DPRK].

The following vessels have been added to OFAC’s SDN List:

AM NOK GANG (a.k.a. AP ROK GANG) General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8132835 (vessel) [DPRK].

BAEK MA KANG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7944683 (vessel) [DPRK].

CHONG CHON GANG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7937317 (vessel) [DPRK].

DAI HONG DAN General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7944695 (vessel) [DPRK].

DOK CHON General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7411260 (vessel) [DPRK].

HWANG GUM SAN 2 General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8405270 (vessel) [DPRK].

HYOK SIN 2 Bulk Carrier Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8018900 (vessel) [DPRK].

JANG JA SAN CHONG NYON HO Bulk Carrier Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8133530 (vessel) [DPRK].

JON JIN 2 Bulk Carrier Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8018912 (vessel) [DPRK].

MU DU BONG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8328197 (vessel) [DPRK].

O UN CHONG NYON HO General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8330815 (vessel) [DPRK].

PHO THAE General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7632955 (vessel) [DPRK].

PI RUY GANG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8829593 (vessel) [DPRK].

PO THONG GANG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8829555 (vessel) [DPRK].

RAK WON 2 General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 8819017 (vessel) [DPRK].

RYONG GANG 2 General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7640378 (vessel) [DPRK].

RYONG GUN BONG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification 8606173 (vessel) [DPRK].

TAE DONG GANG General Cargo Democratic People’s Republic of Korea flag; Vessel Registration Identification IMO 7738656 (vessel) [DPRK].

9 Comments

  1. You say, “And if powerful constituencies matter … .” Wait a minute. I thought we agreed, our strong sanctions on Iran, stronger than those on North Korea, aren’t the result of any “lobby”.

  2. I dunno. What’s the significance of April 2013?

    But you really schooled me on the “lobby”. I learned that it does not drive our Mideast policy. There has to be some reason for the harsher sanctions on Iran than on North Korea, but it ain’t no “lobby”. Oil? Maybe, but it’s not at all clear how sanctioning Iran worse than North Korea helps the oil industry.

    Well, maybe we’ll ramp up the North Korea sanctions enough that this question becomes moot.

  3. I think AIPAC is an important factor in Iran sanctions. But AIPAC couldn’t be a factor if not for the fact that Iran is run by theocratic, despotic, terrorist troglodyte fuckwads who’ve taught most Americans to loathe and distrust them, and rightfully so.

  4. I think that the answer is “NO” but I might’ve missed something. The Law of the Sea Convention only allows search of a foreign vessel on the High Seas for slavery, piracy, radio “piracy”,and statelessness. So a ship without lights or a ship on the SDN List does not automatically qualify. But statelessness now is defined to include a ship that switches between national flags, and that appears possible for fugitive DPRK vessels. A foreign warship has a right to board to establish nationality of the merchant vessel, and one can imagine a possibility here.

    Of course,the DPRK would call it an outrageous act of war, and spit vociferously. But inasmuch as China has just claimed the right to board and search all vessels in its hugely enhanced claim in the South China Sea, it is unlikely to protest an inspection by the USA elsewhere on the High Seas.

    My major doubt lies with the possibility that there are some sanctions laws and regulations, from the UN or the Treasury that I am missing. Still, given the fuss that was made with the Turkish Gaza “fleet”, I doubt our Navy has the sand to board such a ship and take on the possibility of an armed opposition.

    Thanx for the opportunity to pinch hit, and I’m only sorry to have reached base on a walk.

  5. Thanks, David. I knew I could count on you. With respect to Glans’s point, I’m sure the US wouldn’t invoke the authority of a treaty it hasn’t signed or ratified, but I recall reading that the piracy and statelessness exceptions you describe were a matter of customary international law anyway, even before UNCLOS. True?

  6. Piracy and slavery are “customary” grounds to intercept. Piracy is actually a poorly defined term, while customary international law is a vague and constantly developing concept. I believe most countries (including the USA) would claim that UNCLOS states customary law of the sea as to boarding practice even if the USA hasn’t ratified it, thereby covering statelessness and flag games and radio piracy in addition to the customary piracy and slavery.

    We know about Somali piracy, but there’s also a legalistic definition that a pirate is a ship without a national flag allegiance … and pirates are legally everyone’s enemy, and so can be boarded at will anywhere. It’s a flexible concept, but with serious consequences, including death for any sloppy boarders.

    There may be other grounds for search. George Bush and most Western countries entered into an “Initiative” (the PSI) that allows the boarding of a vessel if it is believed to be carrying weapons of mass destruction. This is based on a (reasonable but not entirely accepted) theory that a State doesn’t have to wait to have its national waters violated but can act pre-emptively. Now, these rights aren’t yet “customary” but have an ambiguous status.

    As one knows domestically, an alert policeman can generally create grounds for a search, within or without the letter of the law. The question internationally is always the kick-back, and whether the government wishing to search has the courage to do so when a zero result will cause cat-calling from the hostile peanut gallery.

    Spain did that to a NorK ship once (because, as in your example, the ship’s name was obscured and it had been notorious for changing its flag of allegiance,) found nothing and got blasted.

    I think that the new listing mayn’t result in searches, but it could create a Flying Dutchman syndrome, with the UN/US warning states into which such blacklisted NorK ships are bound that they cannot give them any financial comity at all,…so resulting in a refusal to enter, and the ships circling endlessly in the South Pacific Gyre!

  7. Seems like any actual threat of seaborne WMDs would be met with elimination of all potential targets… And the ocean is a vast and lonely place, with many tales untold, except those predetermined to bring political value to the tellers…

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