Select Committee on Trade and Industry Seventh Report



20. In the wake of the violent disturbances in the second half of 2000 in the Israel Occupied Territories of the West Bank and Gaza, and the deployment against civilian insurgents of Israeli military forces and their military equipment, attention has turned to the extent to which UK-supplied military equipment may have been used by Israeli forces. We sought written information in December 2000 on a number of individual licences recorded in the 1997, 1998 and 1999 Annual Reports. We also raised the matter in oral evidence on 30 January 2001, and thereafter sought further details on four individual licences.

21. UK defence trade with Israel is very small, of less than £1 million a year according to the Annual Reports. Most, but by no means all, exports licensed in the past three years have been of components or technology. The UK has not sold main equipment such as tanks, aircraft, warships or technology since May 1997. It has sold small arms and ammunition.

22. A written answer of 14 November 2000 stated that "the Government have ...long had concerns that CS gas exported from the UK has been used by the Israeli Security Forces against Palestinians and Israeli Arabs" and that it had "refused all applications for permanent licences to export CS gas to Israel".[37] One such licence has been refused, in mid-2000. A temporary licence was granted in 1998 for exhibition purposes; the items have been returned to the UK.

23. Following the outbreak of violence in the West Bank and Gaza in September 2000, attempts have been made to discover if any licensed equipment of UK origin has been used there or in southern Lebanon. Efforts were made in the autumn to obtain assurances from the Israeli authorities. Mr Hain's letter to Dr Starkey of 19 December 2000 refers to an assurance received on 29 November 2000 that "no equipment or components licensed for export from the UK are used against civilians in the Occupied Territories or in southern Lebanon".[38] The FCO forwarded to the Foreign Affairs Committee on 9 January 2001 a "letter of assurance" dated 29 November 2000 from the Israeli Ministry of Defence, stating over the signature of the Deputy Director General, Foreign Affairs, Arms Control and Regional Security at the Ministry of Defence, that "no UK-originated equipment nor any UK-originated systems/sub-systems/components are used as part of the IDF's [Israeli Defence Force's] activities in the Territories".[39] A Written Answer of 18 January 2001 refers to an assurance having been received from the Israeli Government that "no equipment or components licensed for export from the UK have been used against civilians during the recent disturbances".[40] The paper sent to the Committees dated 22 January 2001 reports that the Israeli Government have given an assurance that "no UK-originated equipment, sub-systems or components are used as part of the Israeli Defence Forces' activities in the Occupied Territories." [41]

24. The letter of 29 November 2000 leaves some matters in doubt —

  • whether South Lebanon is covered by the Israeli Government's assurances, and if so since when;

  • whether police and other internal security forces are covered by the assurances;

  • whether general military use [eg in "defensive" positions in S Lebanon] is covered or just use against civilians in specified areas.

25. Mr Hain's letter to Dr Starkey of 19 December states that "we are not, however, simply relying on an assurance from the Israeli government. Our defence section and other staff in the Embassy in Tel Aviv have been active in checking that neither British made equipment nor components have been used during the recent events in the occupied territories".[42] The FCO paper states that they have been "actively monitoring" the equipment used, presumably to see if equipment visibly used includes the type of equipment in which UK components or spares have been fitted. The FCO paper warns that such materials "are embedded in other systems and are therefore not very visible".[43] The Foreign Secretary told us candidly that there was a limit to the extent to which the whereabouts of such equipment duly licensed for export could subsequently be verified.[44] We sought from the Government details of the nature and type of equipment with which some of the imaging equipment listed in Annual Reports was intended to be used. This confirmed that the items are intended for use in a range of lethal equipment. We sought from the Government details of the nature and type of equipment with which some of the imaging equipment listed in Annual Reports was intended to be used. This confirmed the impression that odd bits of printed circuitry or of optical equipment could be anywhere; it is unlikely that the IDF themselves would have any means of being absolutely certain.

26. We are unclear how far simple deployment of a piece of equipment with UK content in southern Lebanon would have been regarded as constituting a breach of the criteria. The FCO state that they have always judged whether equipment would be used "aggressively" in Southern Lebanon and would refuse applications where this was the case.[45] No specific end-use condition was attached since if it had been judged that there was a danger that the item would be misused in contravention of the criteria, the licence would have been refused.[46] No licences for military goods are listed as having been refused. In the absence of any explicit end-use restrictions on exports to Israel, which might for example have covered any deployment in Southern Lebanon, the Israeli Forces would have been free to use UK-supplied equipment and components in Southern Lebanon. The Foreign Secretary told us that he did not recall " ever being confronted with a decision which raised this question...".[47] It is our judgement that officials processing export licence applications for military equipment to Israel should have drawn to the attention of Ministers the possibility of the equipment being used in the occupation of Southern Lebanon, and have thereby required an explicit policy decision on such applications, possibly in the form of specific end-use conditions.

27. We obtained from the Government details of a number of individual and open licences granted for export to Israel over the past three years. We raised with the Foreign Secretary the grant of two Open Individual Export Licences granted in 1998 and 1999 for military vehicles and military vehicle components. Once granted, firms are free to use the licence to export goods without further permission. The Government was at that time relatively relaxed about such exports to Israel, although it was in occupation of Southern Lebanon. On 2 March 2001 the Foreign Secretary informed us in writing that the Government had decided that certain categories of equipment previously subject to OIELs should now be covered by SIELs, allowing for applications to be judged "case-by-case for specific quantities of the relevant equipment for export to named end-users".[48] The Foreign Secretary had told us in oral evidence that "there may well be such open licences where it may be more prudent and appropriate in the future to handle the matter by standard individual licences".[49] We welcome the Foreign Secretary's caution on the future use of open licences for other than the safest destinations. The example of Zimbabwe also reinforces the need for such caution.


28. We have over the past two years made several inquiries about licences granted for the export of Military List items to Morocco. In 1999 the FCO provided at our request a note on how general policy considerations operated in respect of export licence applications for Morocco, in relation to human rights and the Western Sahara. The FCO memorandum stated that "we take every care not to license equipment if there is a clear risk that it might be used by Morocco to assert its claim by force ".[50] In our February 2000 Report on the 1997 and 1998 Annual Reports, we briefly set out some of the results of our inquiries and recorded that we would be seeking further details of some of the licences granted in 1998.[51] In our July 2000 Report we drew on some concerns we had on licences granted for Morocco to come to wider conclusions. We have also received evidence from War on Want and the Western Sahara Campaign.[52]

29. The published list of refusals printed with our February 2000 Report records the refusal of licence application 546084 for Morocco on 28th August 1998, for goods rated ML 2 and ML 5 in the Military List. This was recorded on page 66 of the 1998 Annual Report. The list of appeals against refusals printed with this Report shows that a licence was issued on 12th July 1999 for goods for Morocco rated ML 2, ML 5, ML 22 and PL 5017.[53] The Government provided us in October 2000 with a confidential note on this case, as part of its response to our now standard annual request for details of appeals and refusals. Following the public oral evidence given by the Foreign Secretary on 30 January 2001, the Written Answer of 1 March 2001,[54] and the memorandum submitted to us on 1 March 2001,[55] we can confirm that the 1998 licence application covered the refurbishment of 30 105mm guns and the supply of 6 further guns. The company appealed against the refusal in September 1998, asserting that in its view, refurbishment would not breach the ceasefire regime.

30. Despite accepting advice from officials that refurbishment under MINURSO supervision would be technically acceptable, the then Minister of State, Derek Fatchett, twice maintained his objection to the licence, in October and December 1998. In February 1999 it was agreed to consult the UN in New York. There were a number of meetings between FCO and UN officials over the next few months. In April 1999 the UN told FCO officials that refurbishment could be considered as neutral. In June 1999 the UN Department for Peace Keeping Operations confirmed that refurbishment would not be in breach of existing arrangements and that MINURSO would monitor refurbishment of the guns. In July 1999 the relevant Minister of State, Geoff Hoon, accepted the company's appeal in relation to the refurbishment of the existing guns, but not the supply of new guns.

31. The Foreign Secretary told us in public oral evidence—

     "the United Nations in both Western Sahara and New York confirmed the refurbishment was within the terms of the ceasefire agreement and they were willing to supervise the refurbishment. They assessed the project as force neutral. On that basis, with the full agreement of the United Nations, we proceeded to grant the appeal. However, involved in the same application was a proposal for the supply of fresh guns and we rejected that. There is no licence for the export of weaponry....I think if they [the UN] had resisted the application, we would, on appeal, have upheld our own refusal, but the ground for our refusal was rather removed by the UN removing any objection to it."[56]

32. We fully appreciate the difficulty in which Ministers were placed by the United Nations coming to the conclusion that refurbishment of the guns in question was force-neutral. The UK must have regard for the duly authorised international authority in making licensing decisions, as we note below in relation to the ECOWAS moratorium in West Africa. It is, however, for UK Ministers and not the UN Secretariat to decide on arms export licences. We have at least as much confidence in the judgement of Ministers in such cases as we do in that of the UN. We would have shared the reluctance of Minsters to agree to the proposed refurbishment. If it had remained right in their judgement that the licence should be refused, despite the views of the UN, the appeal against refusal could and should have been turned down, even if that ran a distant risk of judicial review.


33. In response to our July 2000 Report, the Government agreed to "pursue any opportunity to establish a common interpretation" of the June 1989 EU embargo on China, which has always been operated on the basis of differing national interpretations of its scope. The Government Response noted that "several previous attempts to reach a common interpretation of the embargo have been unsuccessful."[57] The Foreign Secretary told us that the issue had been pursued, but warned that a common agreement might lead to a less rigorous embargo than currently applied by the UK as "we resist more than most of our partner states".[58] That is not the impression given by the US General Accounting Office study of 1998, which we quoted in our July 2000 Report. The UK exports "non-lethal" military items, whereas we understand that some EU countries have a ban on all Military List items. We have for example pursued in written questions a licence granted in 1999 for sub-assemblies and spare parts for previously supplied naval equipment . The Government confirmed that the equipment does have a potential military capability.[59] July 2000 we recommended consideration of a stricter interpretation of the arms embargo on China than that currently operated by the UK. If it is now the case that other EU nations are relaxing their interpretation of the 1989 embargo, that lends force to the need for a common interpretation.


34. The UK apparently exports significant volumes of arms and dual-use goods to Taiwan. The export figures for 1999 are very slight, but licences for goods worth £180 million were given. The policy was established in a Written Answer in April 1995, confirmed in a June 1998 Written Answer, referring to case by case consideration, and giving "greater weight" in future to the implications for regional security tension "rather than focussing narrowly on Taiwan's military capability as hitherto".[60] We obtained a list of Military List SIELs granted to Taiwan in 1999, provided in October 2000. We then sought a statement on the operation of the policy in general, and in particular in relation to (a) aircraft and aero-engine spares, and (b) spares for one item of equipment with potential implications for regional conflict. The Government noted in response that it did not apply to Taiwan the terms of the EU arms embargo on China, presumably meaning that it could licence goods to Taiwan which it would not licence for China. In the case of the specific item of equipment referred to, it had been judged that it would only be used defensively in Taiwan's own territory and by the Army in civil disaster relief. In oral evidence, the Foreign Secretary emphasised his anxiety to make sure that nothing "upset the balance of forces".[61] There is no EU regime on exports to Taiwan. Some EU states are reported to have exported warships and other major items of equipment in the recent past.


35. The second annual Report on the Code refers to the importance of member States exchanging information on national interpretations of embargoes. The Foreign Secretary told us that sometimes it was suspected that some countries were in effect operating an embargo on certain countries.[62] Our inquiries over the past two years have turned up a number of cases of embargoes or special export regimes whose terms are vague, either through oversight or as part of a deliberate policy of fudge. We have reported in this and our other Reports on licences granted or refused for exports to a number of countries where we have expressed concern at the absence of a clear and common EU regime. On Cyprus,[63] for example, the UK responded to the June 1996 United Nations Security Council Resolution 1062 expressing concern at the military build-up on the island by imposing a limited embargo, on the lines of the regime applied to China. Some other EU Member states apply a more or less complete ban. Others do not have specific policies; reports in the trade press suggest that some may be more permissive than the UK. We conclude that vigorous efforts to procure a common interpretation, at the very least among the member states of the EU, of "limited" arms embargoes would engender a greater atmosphere of mutual confidence.

37  HC Deb, 14 November 2000, col 608w Back

38  Ev, p 36 Back

39  Ev, p 37 Back

40  HC Deb, 18 January 2001, col 317w Back

41  Ev, p 36, para 6 Back

42  Ev, p 37 Back

43  ibid, para 7 Back

44  Q 102 Back

45  Ev, p 35, para 4 Back

46  Ev, pp 36 & 37 Back

47  Q 99 Back

48  Ev, p 38 Back

49  Q103 Back

50   HC 540, p 88, para 3 Back

51  HC 225, paras 10 and 41 Back

52  HC 540, p 92-3; HC 225, p 73 Back

53  Ev, p 26 Back

54  HC Deb, 1 March 2001, cols 735-6w Back

55  Ev, pp 41ff Back

56  Qq 116, 120 Back

57  Cm 4872, p 6 Back

58  Qq 104-5 Back

59  Ev, p 40, 9 Back

60  HC Deb, 4 April 1995, col 979w; ibid, 4 June 1998, col 349w Back

61  Q 107 Back

62   Q 66 Back

63  Ev, p 32 Back

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