Team POSS Precursors Strategic Goods Sanctions Transit-Transhipment . Transit-Transhipment WA Practical Workshop Vienna, 27-28 June 2016 1

Increased focus on transit and trans-shipment Commitments under international law for conventional arms: ATT; UNSCR embargoes. International obligations for dual-use items : UN Security Council Resolution 1540 (2004), UNSCR sanctions Discussions in regional fora and non-proliferation regimes (e.g. WA, NSG Good Practice Guide) ATT-OP

Transit controls: Looking for a needle in a haystack So here we see what the problem is with transit controls, it is like looking for a needle in a haystack. But still we try our best. First let me explain about the difference between military and dual use goods. 3

Military transit controls The controls on the export from and transit through the Netherlands of military goods is based on the General Customs Law, the Decree on strategic goods and the Implementation order on strategic goods. In principle transit of military items through the Netherlands requires a license 4 4 4

Transit military items Shipments originating or destined for Australia, Japan, New-Zealand, Switzerland, Member States of the European Union or NATO allies trans-shipped in the Netherlands require a transit license Transit shipments originating from or destined for the countries mentioned above do not require a transit-license. For such shipments there is a notification requirement. Trans-shipment: both on the same or on a different type of transport 5 5

Ad-hoc license requirement Indications that a consignment may not be under effective control of the country of origin Destination appears to change Required by international law or agreement Essential interests of national security 6 6

Overview transit military items EU MS/NATO+  EU MS/NATO+  transit NL  notification requirement  trans-shipment NL  licence requirement (General licence nr. NL008) EU MS/NATO+  3rd country  transit NL  notification requirement  trans-shipment NL licence requirement (General licence nr. NL007) 3rd country  EU MS/NATO+  transit NL  notification requirement  trans-shipment NL  licence requirement (General licence nr. NL 008) 3rd country  3rd country  transit NL  licence requirement  trans-shipment NL  licence requirement 7 7

General transit licenses NL008: - Shipments destined for EU MS or NATO partner, Australia, Japan, New-Zealand or Switzerland. - Regardless the origin - Applies to almost all military items NL007: - Shipments originated from EU MS or NATO partner, Australia, Japan, - Destination is another country than those mentioned above - Limited number of military items: Exclusion of, inter alia, weapons, munitions and complete systems. 8 8

Dual use transit controls Based on EU regulation 428/2009 definition (art 2.7) controls (art 6) 9 9 9

Definition of Transit in EU dual-use reg. 428/2009 “Transit” shall mean a transport of non Community dual-use items entering and passing through the customs territory of the Community with a destination outside the Community Consignee in country B Exporting country A Entering / passing through EU 10

Dual use transit controls - controls Prohibition possibility if the items in transit are or may be intended for use in a WMD-programme (art 6.1) National possibility to require a license before prohibiting the transit (art 6.2) National possibility to extend the transit controls to military end use concerns if the destination is subject to an arms embargo, or if the items are not listed in the control lists (art 6.3) 11

Information sharing A prerequisite for meaningful risk management Multifaceted Inter- and intra-governmental Transport sector Common information should be available to enforcement authorities the full length of the supply chain

Challenges Harmonisation between customs legislation and export control legislation Identifying shipments of concern – risk analysis Problem ownership Who should apply for a licence? What happens with items that have been prohibited? Who pays for costs incurred? Who is responsible for a transaction If a transit or trans-shipment is stopped: What happens next? Who can be investigated and prosecuted? Where to find evidence? Over-dependence on electronic systems 13 13 13

Case example Information of a shipment through the Netherlands of chemicals to a (cover) company in a country of concern. National and International (interagency) cooperation, communication and information sharing Container unloaded Chemicals seized; destroyed 14

“Knowledge is of two kinds “Knowledge is of two kinds. We know a subject ourselves, or we know where we can find information on it” Samuel Johnson (1709 - 1784) Klaas Leenman Netherlands Customs, Team POSS +31618607748 k.leenman@belastingdienst.nl 15 15