S.I. 2006/3327: memoranda from the Foreign and Commonwealth Office

North Korea (United Nations Measures) (Overseas Territories) Order 2006 (S.I. 2006/3327)

The Committee has requested a memorandum from the Foreign & Commonwealth Office on the following points:

(1) Article 2(1) defines "prohibited luxury goods" as meaning the goods listed in Schedule 4 as amended from time to time. Article 3, after paragraph (d), contains a declaration that the Governor may amend the list in Schedule 4 in accordance with any EC Regulation giving effect to the Security Council Resolution. Explain -

(a)  the purpose and intended effect of the underlined words;

The purpose of the underlined words is to define prohibited luxury goods as comprising the Schedule 4 list of goods as amended from time to time in its application to each territory, with the intended effect of indicating that the prohibited goods may change from time to time. The power in Article 3 is a power to amend the list for the relevant territory and not to amend Schedule 4 to the Order. If it is considered that greater clarity is necessary, an appropriate amendment will be made.

(b)  the purpose and intended effect of the declaration;

The purpose of the declaration is to provide a power to enable the Governor of a territory to amend the list of prohibited luxury goods set out in Schedule 4 as it applies to that territory. The intention is to reflect any alteration to the list set out in an EC Regulation giving effect to the Security Council Resolution, which for the sake of uniformity between the United Kingdom and its Overseas Territories will be mirrored in the Overseas Territories.

(c)  what authorises the Order to empower the Governor to amend Schedule 4;

The Order does not authorise a Governor to amend Schedule 4, but only the list of goods contained in Schedule 4 in its application to the territory of which he is Governor. The EC Regulation, which will implement aspects of the Resolution, contains an Annex listing luxury goods, and will be the sole source of a common list for the purposes of the Resolution once the Regulation is in force. The provisions in the Order are intended to mirror the EC list.

(d)  the derivation of the list in Schedule 4 and what is meant by "high-quality", "high-end" and "luxury" as those expressions are used in that Schedule.

The list in Schedule 4 derives from the EC Regulation intended to give effect to aspects of the Security Council Resolution. The words in question have not been defined in the EC Regulation and will require interpretations to be made by the enforcement authorities in Member States and in the UK's Overseas Territories.

(2) Explain the intended effect of ""export" includes "shipment" as "stores"" in article 2(1) and how that effect is achieved.

The intended effect of the definition of "export" to include shipment as stores, is to prevent restricted or prohibited goods being shipped as stores on a vessel or aircraft and thereby being exported under what might be a loop-hole. This is a long-standing provision in such Orders.

(3) Explain the meaning of "a person or body to whom this Order applies" in the definition of "procurement" in article 2(1).

As Article 8 is worded to prohibit "procurement", this wording in the definition of "procurement" is intended to clarify that "procurement" means "procurement", as defined, by a person or body to whom the Order applies.

Foreign & Commonwealth Office

30 January 2007

Second memorandum:

The Committee has requested a further memorandum on the following points:

(1)  Provide the full text of Resolution 1718(2006) referred to in the preamble.

The full text of Resolution 1718(2006) is attached.[1]

(2)  Provide the full text of the EC Regulation referred to in the Department's answer. If it is still in draft, provide the full text of the latest draft and indicate the stages remaining before adoption can take place.

The full text of the draft EC Regulation is attached.¹ The adoption of the Regulation has been delayed due to a dispute between Spain and the United Kingdom over the inclusion of a competent authority for Gibraltar in Annex II. We have just heard to-day that a solution has been found which should allow the Regulation to be adopted. After agreement in RELEX, the draft Regulation will go to COREPER then to the Council for adoption. Once the Regulation has been adopted, specific reference to it will be made (by amending SI 2006/3327), which had been the original intention, until the dispute intervened.

(3)  In answer to the Committee's previous question 2, the Department states that the words ""export" includes shipment as stores" is a long-standing provision in orders of this nature. The Committee notes that such orders generally also include definitions of "shipment" and "stores" (see for example S.I. 2004/347). Explain why no equivalent definitions were included in this Order.

We endeavour to standardise, and the omission of these definitions was inadvertent due to an oversight for which we apologise. We will add the definitions to this Order when we amend it, and will ensure consistency in future Orders.

(4)  The Department has not answered the Committee's previous question 3. What is the meaning of the words "a person or body to whom this Order applies" in the definition of "procurement"? What purpose is served by including those words in the definition?

We regret that our response did not sufficiently answer the question. The meaning of the words "a person or body to whom this Order applies" relates to article 1(5) which provides that any person in the territory or any person or body (specified in Article 1(5)(a) or (b)) elsewhere may commit the offence under article 8(3) of being knowingly concerned in procurement. The words in question were intended to limit procurement to procurement by any such person or body, to make it clear that the procurement prohibited was not to be read more widely. To define procurement without such qualification might be taken to mean that any procurement from Iran to anywhere by any person was being prohibited, which would not appear competent within the scope of this Order, which is part of the law of each of the territories to which this Order extends and does not apply more widely. This is however the first occasion when procurement has been the subject of a sanctions measure, and consequently defined for the first time. If it is considered that the words in question are unnecessary due to Article 8(3) taken with Article 1(5), they can be deleted when the Order is amended.

Foreign & Commonwealth Office

12 February 2007