On 12th February a news release advised that the Isle of Man had updated its Libyan sanctions, with the entry for vessel “Capricorn” replaced by an entry under its new name, “Nadine”.
In a new podcast series, Agnes Frimston and Ben Horton interview Chatham House experts about the critical underlying issues which are shaping modern society. The first episode features Patricia Lewis on cybersecurity for nuclear weapons systems, and Inderjeet Parmar on the future of the US-led liberal world order.
This Order, SI 2018/165, comes into force on 5th March. It updates the list of goods requiring an export licence in the UK. These changes are described as technical and minor in nature – for the most part they seek to clarify existing controls, and there is a new definition on “biological agents” and the deletion of the definition for “adapted for use in war”. The changes reflect those made to the EU Common Military List, and those made under the Wassenaar Arrangement, an international export control agreement.
As a follow-up to the Baker McKenzie webinar mentioned in a previous blog post, the US Department of Labor maintains a seemingly user-friendly website with a list of goods and their source countries which it has reason to believe are produced by child labour or forced labour in violation of international standards, currently comprising 139 goods from 75 countries.
11th February 2018
TERROR SUSPECT AND CAREER CRIMINAL WITH 17 ALIASES WORKING AT HEATHROW AIRPORT
On 10th February, the Mirror claimed that Mohamed Abdullahi Mohamud was able to access the runway at Heathrow despite being on an official terror watch list. He was given a security pass and allowed to start working as a kitchen porter in a first-class lounge without a full background check.
UK TO RELEASE FINDING ON ISLE OF MAN AND BUSINESS JETS IMPORTS
As the EU Parliament announces a new investigation that will, in part, concern itself with how VAT on the import of business aircraft via the Isle of Man, Manx Radio on 10th February reports that the findings from a UK government inquiry into the importation of business jets and yachts in the Island will be published in the spring. HM Treasury is said to have confirmed this in response to a question from MP (and former chair of the Treasury Select Committee) Dame Margaret Hodge. Manx Radio says that a Freedom of Information request last year showed almost £800 million has been refunded in VAT on aircraft imports since 2011.
MANDATORY REGISTER OF ULTIMATE BENEFICIAL OWNERS IN THE CZECH REPUBLIC AS OF 1ST JANUARY
On 10th February, White & Case published an article saying that Czech law requires that “ultimate beneficial owners” of companies and trust funds be recorded in a central register, in the interest of bringing increased transparency to the ownership structures of legal entities.
UK PARLIAMENT QUESTION ON SANCTIONS BREACHES
On 10th February the European Sanctions Blog reported on the answer to a written question in the House of Commons. This included the information that a total of 118 suspected breach cases were reported to HM Treasury’s Office of Financial Sanctions Implementation (OFSI) during 2017, and the approximate aggregate value of [those] suspected breaches was £117 million. Furthermore, as of April 2017, a total of 84 suspected breaches were reported to OFSI since it gained the ability to impose monetary penalties under the Policing and Crime Act 2017.
PBS TV PROGRAMME ON THE 2016 TURKISH COUP
On 7th February, the Washington Institute published an article including video about a PBS investigation in the US which examines the events leading up to Turkey’s 2016 coup crisis and the country’s ongoing struggles since. The website includes a special screening of the programme and a conversation with its producers. In the programme, experts and senior officials weigh in on trends that led to Turkey’s 2016 coup crisis and its ongoing struggles to balance democratic values, the war in Syria, and conflicts with Kurds at home and next door.
TERRORIST GROUP ENGAGEMENT IN CRIME AND SURVIVAL
On 29th November, 2 members of the Department of Political Science at Penn State University in the US published an article that asked: what impact does engagement in crime have on terrorist group survival? They investigated the impact of crime on terrorist group survival using cross-sectional data on 578 terrorist groups observed between 1970 and 2007, and found that engagement in crime reduces a group’s chance of demise by around 50% and extends its lifespan by around 7 years on average. Terrorist groups involved in narcotics are less likely to end by police or military force, but are also less likely to win political concessions. They found that groups involved in extortion live the longest and are also less likely to end by force or by splintering.
ANALYSIS OF US FOREIGN FIGHTERS
In October 2017, START – the National Consortium for the Study of Terrorism and Responses to Terrorism at the University of Maryland – published a summary, infographic brief of its analysis of foreign fighters who departed, or attempted to depart, the US to take part in conflicts overseas. 288 individuals were included in the database 1980-2016. It highlights such things as how travel from the US became much more dispersed following the rise of ISIS in 2013. ISIL/Al-Qaida was the group attracting the largest number of potential fighters (50%), with even more is Al-Qaida in the Arabian Peninsula (AQAP) is included. 14% were aiming to join Al-Shabaab, 10% the Taliban. 16% were labelled as aiming to join “other” groups, unspecified. The median age was 23. Radicalisation via the Internet was said to be a factor in 95% of cases, ad 47% were able to travel thanks to online relationships with travel facilitators.
FOREIGN FIGHTERS IN LIBYA
In January 2018, the Washington Institute offered a briefing that claims to offers a deeper understanding of the foreign-fighter phenomenon, its evolution, and its potential trajectories. The brief says that over the past 7 years of revolution and civil war, Libya has experienced a massive influx of foreign fighters. This development, it contends, deserves attention not just for the domestic menace it poses but also because Libya offers a potential future jihadist hub amid the 2017 collapse of Islamic State centres in Iraq and Syria; and particularly worrisome in the Libyan theatre have been the outsize role of Tunisian fighters and a rise in recruitment in continental Africa.
NEXT STAGE IN THE BATTLE AGAINST THE ISLAMIC STATE
On 8th February, a policy brief from the Washington Institute proposed that focused targeting of jihadist funds, the use of biometric data, and continued co-operation among UN member states all constitute promising answers to threats posed by the group. It says that the group has even claimed responsibility for terrorist attacks it did not carry out; and the group no longer produces some of the online magazines for which it became famous around the world. Despite these setbacks, the UN Secretary-General concluded in his latest report that it present s real threat. It argues that “frustrated travelers” — meaning individuals who attempted to travel to conflict zones but were unsuccessful and remain radicalised — as well as foreign terrorist fighter returnees and those fighters who relocate to other battlefields will become more relevant as ISIL’s pool of recruits diminishes. It also says that sustaining relationships with regional affiliates and followers and supporting sympathizers around the world cost money, and despite losing access to massive oil income, the Islamic State continues to find ways to finance its insurgent and terrorist activities. It says that UN member states report that ISIL moves money across the Middle East by means of the hawala system and cash couriers, as it did before the fall of its caliphate. Outside Syria and Iraq, such as in Libya, ISIL continues to raise funds through extortion and checkpoints, as well as imposing taxes on human smuggling and trafficking networks. The group also takes advantage of legitimate businesses, using them as fronts, as well as “clean” individuals able to deal with the formal financial system. As reconstruction efforts begin in territories liberated from the Islamic State, officials fear the group may be well placed to defraud reconstruction efforts and investment in the local economy, especially through front companies in the construction and other industries. It concludes by saying that Islamic State still poses serious terrorist threats, but it is slowly becoming a more limited and less reliable financial backer of its affiliates and operatives.
IRAN PRESIDENT ORDERS ARMED FORCES TO SELL ALL ENERGY AND BUSINESS ASSETS
On 6th February, Bloomberg reported claims that President Hassan Rouhani has said that Iran’s armed forces, some of which are under US sanctions, must divest from energy assets and other businesses to help save the Persian Gulf nation’s economy. Armed forces, together with the largest state pension fund and other branches of the government, must withdraw from all their commercial holdings, Rouhani said at a news conference.
On 10th February, the Washington Post reported on the bombing by US aircraft of a little-known Chinese terrorist group, East Turkestan Islamic Movement (ETIM) – aka the Turkistan Islamic Party (TIP). A USAF spokesman said that the Taliban and ETIM were commingled on the facilities that were bombed, and often work together, adding that “anybody that is an enemy of Afghanistan, we’re going to target them”. The ETIM comprises ethnic Uyghur militants who want to form a separate state in or near the western Xinjiang region of China, and were formerly based in Pakistan.
On 30th January, Baker McKenzie provided an online webinar on this important topic, and best practices to avoid or mitigate the risks. The forced labour aspect has been stated to be a top priority for US Customs and Border Protection, and the further restrictions on involvement of North Korea and North Korean labour only makes the topic a higher profile one.
The webinar began by pointing out that a US ban on imported goods made with forced labour (including child labour) has been in effect for almost 90 years. However, 2 changes to the law in the last 2 years have radically changed the enforcement landscape:
- the Trade Facilitation & Trade Enforcement Act of 2016 closed a loophole in the forced labour ban which had largely prevented effective enforcement; and
- the Countering America’s Adversaries Through Sanctions Act (CAATSA) established a presumption that goods made by North Korean labourers, regardless of location, are made with forced labour.
Following the first of these, US CBP starting issuing orders.
The webinar posed the question, one that boards and management should be asking themselves – “How do you know this product was not produced, in whole or in part, with forced labour?”.
It points out that a number of other statutes and international standards are increasing the pressure on, and scrutiny of, compliance with human rights requirements; and that a company may be liable for human rights and forced labour abuses by third parties.
This was one of a planned series of trade-related webinars in 2018, see –