Select Committee on European Union Forty-Ninth Report


ECONOMIC AND FINANCIAL RELATIONS BETWEEN THE EUROPEAN COMMUNITY AND IRAQ

Letter from the Chairman to the Rt Hon Peter Hain MP, Minister for Europe, Foreign and Commonwealth Office

UNNUMBERED: DRAFT COUNCIL REGULATION AMENDING COUNCIL REGULATION (EC) NO 2465/96 CONCERNING THE INTERRUPTION OF ECONOMIC AND FINANCIAL RELATIONS BETWEEN THE EUROPEAN COMMUNITY AND IRAQ. REGULATION ON THE IMPLEMENTATION OF UN SECURITY COUNCIL RESOLUTION 1409 (2002)

UNNUMBERED: DRAFT COUNCIL COMMON POSITION 2002/. . ./CFSP CONCERNING THE DEROGATIONS FROM THE EMBARGO WITH REGARD TO IRAQ AND REPEALING COMMON POSITION 96/741/cfsp. COMMON POSITION ON THE IMPLEMENTATION OF UN SECURITY COUNCIL RESOLUTION 1409 (2002)

  Sub-Committee C considered these documents at their meeting on 20 June and agreed to clear both of them.

  Nevertheless, we would be most grateful to be informed what measures are in place to prevent illegal exports and imports across land borders, and in particular via Syria and Jordan and with what degree of success.

  We would also like clarification of the status of the escrow account that is referred to several times in the draft Council Regulation. Who has (or will) set up this account and who places money in it?

24 June 2002

Letter from The Rt Hon Peter Hain MP, Minister for Europe, to the Chairman

  Thank you for your letter of 24 June informing me that your Committee has agreed to clear these documents from scrutiny. I am grateful for your Committee's expeditious consideration of the material.

  In your letter you ask what measures are in place to prevent illegal exports and imports across land borders, and in particular via Syria and Jordan and with what degree of success. Iraq's imports under the Oil for Food programme which are transported overland must arrive in Iraq at one of four designated border checkpoints where UN agents verify that the goods have UN authorisation. We expect neighbouring states to abide by their binding obligations under UN resolutions to implement and enforce UN sanctions including by ensuring adequate border policing. To this end, where possible, we share information we receive about breaches of sanctions by third countries with the country concerned. We have raised possible breaches of sanctions with Syria and Jordan. In the case of Syria, in addition to bilateral approaches, we have sought to apply diplomatic pressure by raising their illegal import of Iraqi oil at the Un sanctions committee.

  You also ask for clarification of the status of the escrow account referred to in the draft Council regulation. This account was opened with BNP-Paribas pursuant to UN resolution 986 (1995) which established the Oil for Food programme. It is administered by the UN secretariat. Payments for Iraqi oil purchased under the OFF programme must be made into the account. The funds held in the account are then used to fund OFF exports to Iraq, payment being released once the UN agents have confirmed that the goods in question have arrived in Iraq.

8 July 2002


 
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