UN Panel investigating South Korean sanctions violations

The U.N. Panel of Experts has released its latest report, and for the first time since it began publishing them in 2009, it is now investigating South Korea for violating the sanctions. One area the Panel is looking into is its imports of North Korean coal for ten months, in violation of UNSCR 2371, while its Coast Guard dragged out an “investigation” of those imports, allowed the smuggling ships to come and go freely without seizing them, and later charged a few small-time scapegoats.

37. The Panel continued its investigation of prohibited coal exports by the Democratic People’s Republic of Korea in 2017 via transshipment35 through Russian Far Eastern ports, including Kholmsk.36 On 10 December 2018, the Republic of Korea indicted four of its nationals and five commodity trading companies for illegally importing coal and pig iron (see table 1). The motive reportedly cited by the Public Prosecutors’ Office was “profit from arbitrage, using the fact that the prices of North Korean coal and other materials are low due to their difficulty to be traded internationally”.37

This may not be the full extent of South Korea’s imports of North Korean coal, either:

35. The Panel’s investigations into coal brokering and export chains highlight the significant amounts of revenue for the Democratic People’s Republic of Korea as well as profit for commodity traders seeking commissions or arbitrage from such deals. The Wise Honest shipment was worth $2,990,000, according to its contract (see annex 17). Regarding the shipment’s export documentation and brokering chain, Indonesia stated that it had recovered “cargo documents and clearance received from a Russian cargo ship intending to conduct an STS transfer around Balikpapan waters in East Kalimantan”. The Panel requested further clarification and/or documentation, which has not been received to date. Indonesia also named a company of the Republic of Korea, Enermax, as the “final destination/recipient of the coal upon the STS transfer of the coal in Balikpapan” (see annex 16). On 3 December 2018, Enermax informed the Panel that it had been investigated by its national authorities and that there was no import of coal.31 The contract for the shipment named the sellers as Hong Kong Nova International Trade Company, an entity selling cigarette-manufacturing machinery. The company informed the Panel that it “had no idea where the contract came from nor why it has our company’s seal” (see annex 18).

The Panel also warned Seoul about its exports of fuel to Kaesong without notifying the 1718 Committee (see UNSCR 2397, paragraph 5). The Moon administration risibly claimed that this was not a violation because the fuel wasn’t really for North Korean use. The Panel is hearing none of it.

13. The Panel sent a letter to the Republic of Korea regarding August media reports of a transfer of petroleum products to Kaesong for a planned inter-Korean liaison office. The ROK replied, “in the process of carrying out the [inter-Korean] projects, the ROK personnel used the petroleum products exclusively for the implementation of the projects, while ensuring that no transfer of economic values to the DPRK occurs.” The ROK explained that “among 338,737 kg of petroleum products used for the implementation of the joint projects from January 2018 to November 2018, 4,039 kg were unused and brought back to the ROK.” The Panel notes that the specific language of paragraph 5 of resolution 2397 (2017) requiring Member States to notify the Committee of any transfer to the DPRK of refined petroleum products is by territory as opposed to possession and does not differentiate between temporary and permanent transfers, or under whose control the items will be after transfer.

In terms of volume and value, this is a de minimis amount of fuel. What Seoul is clearly trying to do here is push the boundaries and test U.S. and UN reactions to this violation, to establish a precedent for progressively larger violations. In rejecting that argument, the Panel is reading the resolutions to mean what they plainly say — that there is no ethnic exemption to the resolutions, and that “to the DPRK” means “to the DPRK.” Moon Jae-in is a lawyer. His government is filled with lawyers and other intelligent people who can read resolutions and obtain competent legal advice. If they’re still violating the sanctions two years into this administration, it can only be because they choose to. The more interesting question is whether they’re motivated by naivete, sympathy, terror, or some combination of these things. Depending on the answer, it suggests that Seoul may already be under Pyongyang’s effective political hegemony.

As I’ve said more than once, if South Korea — the very country the UN’s sanctions are designed to protect — gets away with violating the sanctions, any U.S. appeal to other states to comply with them becomes a punchline. And if no one but us complies with the sanctions, the U.S. won’t have sufficient leverage to slow, stop, and reverse Kim Jong-un’s violations of every norm of human civilization, or to confront his threats to peace and freedom everywhere from Kuala Lumpur to Hollywood to Al-Kibar, without resorting to the use of force. Letting sanctions fail would be a license for Kim Jong-un to nuke up, to proliferate, to assassinate, to steal, to counterfeit, to rape and murder, to starve the poor, to extort and censor Americans in their own country, and ultimately, to dominate South Korea and smother it in fear, poverty, and darkness. Moon Jae-in came into office with the expressed intent to undermine sanctions by reopening Kaesong and Kumgang, putting his government in a direct conflict with core U.S. national security interests. Sanctions have now stopped him from doing that for almost two of his five years in office. With his approval rating now below 50 percent and falling, and with the economy steadily losing altitude, Moon cannot afford to expose his country’s banks and conglomerates to sanctions risks. Here’s hoping our erstwhile allies in Seoul missed their window to betray us.