THE FINANCING OF WMD PROLIFERATION: CONDUCTING RISK ASSESSMENTS

On 30th October, the Center for a New American Security published a report by (friend of the blog) Dr Jonathan Brewer.  In the accompanying article, he says that despite the threat from the financing of proliferation of nuclear and other WMD, only a handful of governments and companies are taking meaningful steps to counter it.  The report outlines the various sources of the threat, the international control framework, and how authorities and financial sector actors fit into the countering proliferation finance regime.  Effective partnership between them is essential, he says, to identifying and countering the threat.  The report describes how authorities and financial institutions should conduct proliferation financing risk assessments, a necessary first step to take to protect themselves, and the indicators to take into account and procedures to follow, and offers a points-based blueprint for measuring specific levels of proliferation finance risk, which financial institutions could use as benchmarks against which to monitor their customers and their businesses.

https://www.cnas.org/publications/reports/the-financing-of-wmd-proliferation

cnas

FATF: MALAYSIA AML/CFT EVALUATION FOLLOW-UP REPORT

On 31st October, FATF published the 3rd update report following the mutual evaluation report (MER) of 2015.  This report analyses Malaysia’s progress in addressing the technical compliance deficiencies identified in the MER.  To reflect this progress, the FATF has re-rated Malaysia on the following Recommendations –

  • 32 – Cash couriers from largely compliant to compliant
  • 34 – Guidance and feedback from largely compliant to compliant

The report also looks at whether Malaysia’s measures meet the requirements of FATF Recommendations that have changed since the MER, taking into account any new measures since the MER.  The FATF agreed to re-rate the following Recommendations –

  • 5  – Terrorist financing offence from  largely compliant  to compliant
  • 7 – Targeted financial sanctions related proliferation from partially compliant to compliant

The FATF maintains the ratings of “Largely Compliant” for Recommendation 8 and “Compliant” for Recommendations 18 and 21.

The report says that Overall, Malaysia has made progress in addressing the technical compliance

deficiencies identified in its MER and has been re-rated on 4 Recommendations, so that only 2 Recommendations remain PC.  Malaysia has addressed the deficiencies identified under R.7 including the revised requirement of R.7 and its Interpretive Note, and has been re-rated as Compliant with R.7.  Equally, Malaysia has addressed the minor deficiencies identified under R.5, R.32 and R.34 to be re-rated as Compliant on all 3.  Malaysia remains largely compliant with the revised R.8 and maintains a compliant rating with the revised R.18 and R.21.

The re-ratings result in the following –

malay

http://www.fatf-gafi.org/media/fatf/documents/reports/fur/FUR-Malaysia-2018.pdf

US INDICTS 10 CHINESE OVER SCHEME TO STEAL AEROSPACE TECH

EurActiv on 31st October reported that the US has indicted 10 Chinese, including 2 intelligence officers, over a 5-year scheme to steal technology from US and French aerospace firms by hacking into their computersThis came 20 days after the DoJ obtained the unprecedented extradition of a senior Chinese intelligence official from Belgium to stand trial in the US for running the alleged state-sponsored effort to steal US aviation industry secrets.  The DoJ said the Chinese Ministry of State Security, through its Jiangsu province unit, engineered the effort to steal the technology underlying a turbofan engine used in US and European commercial airliners.

https://www.euractiv.com/section/china/news/us-indicts-10-chinese-over-scheme-to-steal-aerospace-tech/

HOW THE WEST’S RESEARCH AIDS CHINA’S MILITARY

Real Clear Defense on 30th October published an article on how the Chinese military gains access to research in Western countries.  It says that while this military–academic onslaught has largely flown under Western radars, China has made little effort to keep it secret at home.  It relates one story involving a “student” among those of the estimated 2,500 scientists and engineers “selected” by the Chinese military to study and work abroad in the last decade.  Examples of this phenomenon, and of the People’s Liberation Army’s broader expansion of research with universities outside China, are detailed in areport, “Picking Flowers, Making Honey: the Chinese Military’s Collaboration with Foreign Universities”, released by ASPI.

https://www.realcleardefense.com/articles/2018/10/30/how_the_wests_research_aids_chinas_military_113922.html

The report itself, from the Australian Strategic Policy Institute is at –

https://www.aspi.org.au/report/picking-flowers-making-honey

Its recommendations include, in respect of export controls –

  • The Government should consider further controlling technology transfer to certain end users. Transfers of controlled technology to PLA members and civilians heavily engaged in military research should be restricted regardless of their geographical location;
  • The Government should create a list of entities posing national security risks that are subject to special export licence requirements, modelled on the US Entity List;
  • The government should help universities train and provide resources for staff with export control compliance duties;
  • Work continuously with experienced scientists in emerging technology fields to determine whether and how emerging technologies should be controlled; and
  • Ensure that universities are fully complying with controls relating to the intangible transfer of technology in their collaboration with the PLA.

BEARER SHARES NOW FULLY ABOLISHED IN BULGARIA

On 30th October, CMS Cameron McKenna Narbarro Olswang LLP published an article saying that on 23rd October, amendments to the Bulgarian Commerce Act came into force, which entirely repeal bearer shares in Bulgaria.  According to this amendment, all existing joint-stock companies and partnerships that have issued bearer shares must substitute them with registered shares.

http://www.cms-lawnow.com/ealerts/2018/10/bearer-shares-now-fully-abolished-in-bulgaria?cc_lang=en