United
Nations


Security Council
Distr.
GENERAL

S/1995/1017
7 December 1995

ORIGINAL: ENGLISH




LETTER DATED 7 DECEMBER 1995 FROM THE CHAIRMAN OF THE SECURITY
COUNCIL COMMITTEE ESTABLISHED BY RESOLUTION 661 (1990)       
CONCERNING THE SITUATION BETWEEN IRAQ AND KUWAIT ADDRESSED TO
THE PRESIDENT OF THE SECURITY COUNCIL


  I have the honour to refer to paragraph  7 of Security Council  resolution
715 (1991), by which the Council:

  "Requests the Security Council Committee established under resolution  661
(1990)  concerning the  situation  between  Iraq  and  Kuwait,  the  Special
Commission and  the Director  General of the  [International Atomic  Energy]
Agency  to develop  in cooperation  a  mechanism  for monitoring  any future
sales  or supplies  by  other  countries to  Iraq of  items relevant  to the
implementation of  section C  of resolution  687 (1991)  and other  relevant
resolutions,  including  the  present  resolution  and  the  plans  approved
hereunder;".

  I  am  transmitting  herewith,  with  the  concurrence  of  the  Executive
Chairman  of  the  Special  Commission  and  the  Director  General  of  the
International  Atomic  Energy  Agency  (IAEA),  a  report  prepared  by  the
Committee  established  by  Security  Council  resolution  661  (1990),  the
Special Commission  and  the Director  General  of  IAEA that  contains  the
provisions for the mechanism for export/import  monitoring under paragraph 7
of Security Council resolution 715 (1991) of 11 October 1991.

  The report  is also  accompanied by the  text of a  letter, dated 17  July
1995, which  was addressed to  me by the  Executive Chairman  of the Special
Commission. This indicates the general principles  that will be followed  in
implementing the  export/import mechanism in Iraq  and it  is transmitted to
the Council for purposes of information.

  It is  hoped that it  will be possible  for the  Council to take  an early
decision  on the  report  transmitted  herewith, so  that  preparations,  as
necessary, may  be pursued at the  national level for the implementation, at
the appropriate time, of  the export/import mechanism.  Such a decision will
also allow the  Special Commission and  IAEA, which  the report proposes  be
mandated to implement




95-39303 (E)   071295/...
*9539303*
 the mechanism, to proceed with those preparations which, until now, it  has
not yet undertaken, pending a mandate.


(Signed)  Tono EITEL               
Chairman of the Security Council Committee
established by resolution 661 (1990)
concerning the situation between
Iraq and Kuwait








Annex I

Provisions for the mechanism for export/import monitoring 
under paragraph 7 of Security Council resolution 715 (1991)
of 11 October 1991

Report prepared by the Committee established by Security
Council resolution 661 (1990), the Special Commission   
and the Director General of the International Atomic    
Energy Agency


I.  OBJECTIVE

1.  By  paragraph 7 of  its resolution  715 (1991) of  11 October 1991,  the
Security Council:

  "Requests the Security Council Committee established under resolution  661
(1990)  concerning  the  situation  between  Iraq  and  Kuwait, the  Special
Commission  and the Director  General of  the [International  Atomic Energy]
Agency, to  develop in  cooperation a  mechanism for  monitoring any  future
sales  or supplies  by  other  countries to  Iraq of  items relevant  to the
implementation of  section C  of resolution  687 (1991)  and other  relevant
resolutions,  including  the  present  resolution  and  the  plans  approved
hereunder".

The present  report is  submitted to the  Security Council pursuant  to that
request.

2.  The export/import mechanism (hereafter  "the mechanism") is one  element
of   the  Special   Commission's  and   IAEA's  plans   (S/22871/Rev.1   and
S/22872/Rev.1 and  Rev.1/Corr.1), approved  by  Security Council  resolution
715 (1991),  for ongoing monitoring  and verification  of Iraq's undertaking
not  to reacquire proscribed  weapons capabilities.   Such  monitoring is of
indefinite duration  and is to continue  until the  Security Council decides
that it should be terminated.

3.  Paragraph 7 of resolution 715 (1991) makes provision for the  monitoring
of sales or supplies  by other countries to Iraq of items covered by the two
plans after  the sanctions imposed by  resolution 661 (1990)  on those items
have been  reduced or  lifted pursuant  to paragraph  21  of resolution  687
(1991).  The  mechanism should provide important  data, which will serve  as
one of  the main  tools for  ensuring that  Iraq does  not reconstitute  its
weapons of mass  destruction programmes.  It is evident, therefore, that the
mechanism must be in  place before any decisions  are taken by  the Security
Council to  reduce  or lift  sanctions  on  items  covered by  the  relevant
resolutions and the plans.

4.   It follows  that there  will be  a period  of time  after the  Security
Council adopts the mechanism  before it reduces or  lifts sanctions on items
covered by the mechanism.  For as long as these  items remain subject to the
sanctions under resolution 661 (1990), the Committee  established under that
resolution  shall  continue  to  perform  its  present  functions,  and  any
requests for  the sale  of such  items to  Iraq, as  essential for  civilian
needs, should  be addressed  in accordance  with existing  procedures.   The
Committee shall seek the advice  of the Commission or IAEA, as the case  may
be, on the disposition  of the request.  If  authorization is granted by the
Committee,  the Commission and  IAEA will  be so informed to  enable them to
make the necessary arrangements to monitor the items in Iraq.

5.   The  mechanism  takes  account of  the requirements  of paragraph  7 of
resolution 715 (1991), and of certain  elements in the plans  approved under
that resolution including  a requirement  for timely  information about  any
sale  or supply to Iraq by  other States of items covered by the plans.  The
mechanism also takes account of the continued embargo on the sale or  supply
to Iraq  of items  prohibited  by paragraphs  8  and  12 of  resolution  687
(1991). 

6.  The mechanism  is not a regime  for international licensing,  but rather
for the  timely provision of  information by States  in which companies  are
located which  are contemplating sales or  supplies to Iraq of items covered
by  the plans. 1/   Iraq's  obligations, comprehensively spelled  out in the
plans, are further detailed in the mechanism.

7.   Even  without inspecting  every import  into  Iraq,  it is  feasible to
establish an effective and  credible mechanism.  It must be robust enough to
deter Iraq and  suppliers 2/  from potential breaches.   The mechanism  must
also be  augmented by  the ability  of the  Commission and  IAEA to  conduct
unrestricted inspections throughout  Iraq.  No other existing  export/import
control has such  supplementary ground inspection  rights.  Nevertheless, to
be workable,  the mechanism must  also be sufficiently  simple so  as not to
place  an undue reporting  burden on  Governments.  The aim  is to encourage
companies and  Governments to  report all  of interest,  while keeping  data
volume manageable for all concerned.

8.   Each  Government shall determine what  measures it has to  take to give
effect  internally to  the  notification requirements  under  the  mechanism
(e.g. requiring  national licences).  Each  Government shall  remain free to
enact prohibitions  or controls on exports  that go  beyond the requirements
of the Security Council resolutions and the mechanism.

9.  The mechanism aims  to secure timely notification of  the export to Iraq
of  any   items  identified  in  the   plans  for   ongoing  monitoring  and
verification.   Both Iraq  and the  Governments of  suppliers shall  provide
these notifications  in  advance of  shipment.    These notifications  shall
identify the supplier, give  a description of the  item or items  (including
technology)  and provide  the name  of  the end-user  or consignee  and  the
expected date of  dispatch/shipping.   Other information, when available  to
the  Government of the  supplier, which  should assist  in administering the
mechanism, shall  also be included  in the  standardized notification  forms
referred  to in paragraph  14 below.   The notifications  are imperative, as
they make it possible to monitor  the supply to Iraq of all items covered by
the  plans,  both non-proscribed  dedicated-use  items  and  dual-use  items
(i.e., those  items  that can  be used  for either  permitted or  proscribed
purposes).   Iraq  shall also  report the  export  of  items subject  to the
plans, whether such items are in the original or modified  form, so that the
Commission and IAEA can maintain full accounting for all monitored items.

 10.   If an item, the  import of which  should have been notified under the
mechanism but was not,  is found in Iraq, the import would constitute a case
of non-compliance  with the monitoring regime  established by  the plans for
ongoing monitoring  and verification.   The  steps to  be taken in  cases of
non-compliance  are  defined  in  paragraphs  22   to  24  of  the   Special
Commission's plan and  paragraphs 36 to  39 of the  IAEA plan.   The  strong
presumption  would  be  that  the  item  had  been  procured  for prohibited
purposes and so,  as such, would be subject  to disposal in accordance  with
the  measures  provided for  in  paragraphs  8  and 12  of  Security Council
resolution 687 (1991).


II.  SCOPE

11.  The annexes to the plans for  ongoing monitoring and verification,  and
any appendices thereto, identify the items  and technologies which Iraq,  as
importer, and the Government of the supplier, as exporter, shall notify.   A
compendium of definitions of terms used in the  annexes shall be provided to
Governments.  This compendium shall have the same status as the annexes.

12.  For  purposes of monitoring  within Iraq  and reporting  by Iraq,  such
monitoring and reporting covers all items  and technologies provided for  in
the  plans  and their  annexes,  including  appendices,  whether  identified
generically or specifically.

13.  For Governments of suppliers,  their notification obligations shall  be
limited to the items and technologies  that are specifically identified.  3/
The annexes also identify  items the export  of which to Iraq is  prohibited
under the  Security Council's resolutions.  The procedures to be followed in
respect of such items are contained in paragraphs 24 and 25 below.

14.  Standardized  export/import notification forms shall be made  available
by the  Commission and IAEA to  Governments.   Supplementary information and
clarifications regarding  completion of the forms  and other  aspects of the
monitoring  regime  shall  be  provided  by   the  Commission  and  IAEA  to
Governments in circular notes of  an advisory character.   These notes shall
be  used to give,  for example, details  on the  practical implementation of
the mechanism, such as the timing for submission of notifications.

15.   Should experience over time  demonstrate the need, or new technologies
so require, the annexes  may be amended in accordance with the plans,  after
appropriate consultations  with interested States and,  as laid  down in the
plans, notification to the Security Council.


III.  CHARACTERISTICS OF THE MECHANISM

16.   Resolution 715 (1991) foresees  a unified  monitoring mechanism, under
the  Security   Council.    A   single  address   for  communications   from
Governments,  including  the  completed notification  forms,  would  greatly
simplify  the  task  of  Governments.   A  joint  unit, constituted  by  the
Commission and IAEA, shall be established  at United Nations Headquarters in
New York, where  the largest number  of Governments  are represented.   This
Unit shall receive,  for action by the Commission  or IAEA, as the case  may
be, all communications from Governments. Action  by the Commission and  IAEA
shall  be coordinated  closely,  especially where  the items  concerned come
under the provisions of both plans  for ongoing monitoring and verification,
and any following correspondence on  such items shall be  shared between the
Commission and IAEA.  The notifications Iraq is required to submit shall  be
delivered to  the Baghdad  Monitoring and  Verification Centre, which  shall
serve both  the Commission and  IAEA, for onward  transmission to the  Joint
Unit in New York.

17.  In all relevant areas,  a comprehensive exchange of information between
the Commission  and IAEA  shall take place.   The capability to draw  on the
resources  of  the  Commission  and  IAEA  in  their  respective  spheres of
competence may be essential, in certain  instances, for the determination of
the potential uses of a particular item subject to notification and thus  of
its  correct characterization  under the  plans  and the  mechanism.   It is
important that the Commission and IAEA  have this independent capability  in
order  to avoid  any possible  claims of  partiality.   In a  similar  vein,
recognizing  that information  provided  in notifications  may,  in  certain
instances,  be  proprietary  and  sensitive  for  commercial  reasons,   the
information provided shall be treated as  confidential and restricted to the
Commission  and IAEA,  to the  extent  that  this is  consistent with  their
respective responsibilities  under Security Council  resolution 715  (1991),
other relevant resolutions and the plans.

18.     The  information  provided  shall   be  stored   both  manually  and
electronically and collated with other information derived from  inspections
and declarations, in order  to assess the extent  of Iraq's compliance.   It
is important for implementation of the overall monitoring process as it:

  (a)  Provides information on denied exports, thereby  acting as a means of

identifying possible proscribed activities;

  (b)  Allows inspectors  to tag notified equipment  as it is  imported into
the country;

  (c)  Allows inspectors to verify the location of imported materials;

  (d)  Alerts  inspectors to  the locations  of new  facilities relevant  to
monitoring;

  (e)   Monitors the quantities of  materials imported, in order to identify
any increase in  import which may  be out  of proportion  to commercial  and
other non-proscribed requirements.

The information shall also provide an essential tool for the designation  of
sites,  facilities,  activities,  materials  and  other  items  in Iraq  for
inspection purposes.

19.   The notification  procedure must  be swift  and, as  far as  possible,
while being consistent with the terms set down by the Security Council,  not
impede Iraq's legitimate right to import  or export items for non-proscribed
uses.   To that  end, these notification  forms shall apply  to transactions
involving any  type of  reportable item  (dual-use items  or proscribed  and
non-proscribed  dedicated-use  items,  as  determined  under  the  Council's
resolutions).   Two separate  sets of  forms are envisaged; one  for Iraq to
complete  and the  other for  the Government  of the  supplier to  complete.
Each  transaction shall  have a  unique  designator  number assigned  by the
Joint  Unit,  to  be  used  where available  in  all  correspondence.   This
obviates  the requirement  to  repeat information.  Substantive  changes  to
earlier statements shall be  transmitted to the Joint  Unit by Iraq  and the
Government of the supplier as those changes become known to them.

20.   Each form  shall be  in two  parts, with  an acknowledgement  section.
Iraq  should facilitate  the process  by  filing  notifications as  early as
possible in  the transaction.  The  onus shall  be on Iraq to  ensure that a
supplier understands its part in the notification process.   In this regard,
Iraq shall inform the  supplier of the unique designator number assigned  by
the Joint  Unit on  the basis of  Iraq's initial notification.   This  would
help to  avoid confusion arising,  for example,  from differing descriptions
of the exported item by Iraq and by the supplier.

21.   The forms themselves  shall be developed  by the  Commission and IAEA,
bearing in mind standardized  international practice in respect of commodity
description  and  coding  in  international  trade.    The  forms  shall  be
available in English and French  and shall be submitted to the Joint Unit in
either  one  of  these  languages  so  as  to  facilitate  and expedite  the
processing of the forms.

22.   In  order to  facilitate the  work of  the Joint  Unit and  monitoring
inspections,  Iraq shall  maintain  files with  the  relevant  documentation
(e.g. contracts,  shipping documents,  letters of credit, etc.)  for imports
of  all items subject to notification by it.  These files shall be available
to the Commission or  IAEA, as the case  may be,  upon request.  Full  files
shall  be kept at the points  of entry and by the  Iraqi National Monitoring
Directorate.  Copies of relevant documentation  shall accompany each item as
it  is transported  between its  point of  entry and  the site  of  end-use.
Relevant  technical documentation  shall also  be  available at  the end-use
site for inspection by the Commission or IAEA, as the case may be.

23.   In the event  that a difference arises between  the Commission or IAEA
and the Government of  a supplier on whether  a particular export is subject
to notification,  or whether  it is  prohibited under  the plans  or on  any
other  substantive  matter  arising  in  the  course  of  implementing   the
mechanism,  every effort  shall be  made  to  settle the  difference through
confidential consultations between the Commission or  IAEA, on the one hand,
and the Government, on the other.   In the event that  such consultations do

not resolve the difference,  the matter may be referred by the Commission or
IAEA, or the Government concerned, to  the Security Council or the Sanctions
Committee, as appropriate.


IV.  SPECIAL CASES

24.    The  Commission's  plan  for   ongoing  monitoring  and  verification
identifies  items, the acquisition of  which by Iraq is  prohibited save for
certain limited exceptions 4/  with respect to which Iraq must obtain  prior
consent from  the Commission.   Where  such consent is  obtained, Iraq  must
communicate  that   consent  to  the  supplier,   to  be   attached  to  the
notification by  the Government of the  supplier referred to  in paragraph 9
above.  A  special case relates to the  emergency import of vaccines,  where
such import  by Iraq may  take place with  simultaneous notification to  the
Commission.    In  such  circumstances,  the  Commission  shall  notify  the
supplier, the name  of which must be provided  to the Commission  by Iraq in
its  simultaneous  notification, of  its  consent.    In  cases where  these
requirements  are not met,  Governments shall be  obliged to  provide to the
Joint Unit,  referred to in paragraph 16 above, any  information notified to
them,  by a supplier  located on  their territories,  concerning attempts by
Iraq  to  acquire from  that  supplier  items  prohibited  under the  plans.
Governments will  be encouraged also to  provide any  other information they
may have on such attempts.

25.  The IAEA  plan for ongoing monitoring and verification, as approved  by
the Security  Council, requires  both Iraq  and exporting  States to  secure
prior approval from IAEA or the Sanctions Committee, as the case  may be, of
transfers  to Iraq,  in particular  prior  to the  lifting of  sanctions. 5/
Once sanctions  are lifted,  these provisions  would be  superseded by  this
mechanism.

26.  Attempts  might be made to supply Iraq with items subject  to the plans
in total circumvention of  the mechanism.  In  this respect, Governments may
have at their disposal national information concerning unauthorized  exports
to  Iraq  which  should  have  been  notified  under  the  mechanism.    The
Commission  and  IAEA  shall  exercise  their  rights,  under  the  relevant
Security  Council resolutions  and the  plans, to  conduct no-notice on-site
inspections  at any Iraqi point of entry or elsewhere in Iraq and to require
Iraq,  where necessary,  to impound  items until  such time  as the unopened
consignment can be inspected.

27.    There  may   also  be  attempts  to   supply  Iraq  with  such  items
clandestinely through transshipment.  By this  method, goods could leave the
country  of  origin  without  the  supplier   showing  Iraq  as  the   final
destination.    Goods under  transshipment are  usually  deemed for  customs
purposes to be transit goods; they are not considered to have been  imported
into  the  country of  transshipment.    In order  to  close  this  possible
loophole,  the country of transshipment  shall take action in the event that
it  receives  information  that  Iraq  has  become  indicated  as  the final
destination after  the goods  were exported  from their  country of  origin.
Where this  has occurred, the transshipment  country shall  notify the Joint
Unit of all shipments of such items.

28.  Where  it comes to  the attention of a Government  that the destination
of goods subject to  notification, which are  located in a bonded  warehouse
on its territory,  has been changed  to Iraq,  that Government shall  inform
the Joint Unit accordingly.

29.   Data  available to  the Commission  and to  IAEA may,  in some  cases,
indicate that Iraq is  importing dual-use items in amounts in excess of that
required for non-proscribed internal consumption or  export.  Likewise, such
data  may indicate the import of  items of a  quality and nature that is not
justified  for use in Iraq's  non-proscribed programmes.  In  such cases the
Commission and IAEA, shall, in the first instance, inform the Government  of
Iraq,  through the Joint  Unit, of  its findings  and call upon  it to cease

entering into any arrangements for procurement  of these items.  Thereafter,
the Joint Unit shall, by a circular note to all States,  recommend that they
not enter  into any  new  commitments to  provide  Iraq  with the  items  in
question until further notice.   Should it  prove necessary and in order  to
decide upon  appropriate measures, the Commission  or IAEA, as  appropriate,
shall  enter  into  confidential  consultations  with  the  Governments   of
suppliers with outstanding contracts to provide such items.


Notes

  1/   Both the  Commission's and  IAEA's plans,  however, envisage  special
cases where  the import  by Iraq  of  clearly defined  items requires  prior
consent; see paras. 24 and 25.

  2/  Any entity  involved in a  transaction covered by the mechanism  which
becomes aware that the ultimate destination of a controlled item is Iraq.

  3/    These items  and  technologies  are  identified  in  the March  1995
revision of the annexes  to the Commission's plan as follows:  chemical,  in
paras.  1, 2, 10,  12 and  13 of  annex II;  biological, in the  appendix to
annex  III; and, missiles,  in paras. 1 and  2 of annex IV.   In the nuclear
area, they  are identified in the  March 1995 revision of  annex III of  the
IAEA plan.  If,  in the future, the annexes  are revised, in accordance with
the  procedures in  para.  15 of  the  present  report,  and such  revisions
involve a  renumbering of  the paragraphs  just  indicated, the  renumbering
will be communicated to all States by means of a circular note.

  4/   See S/22871/Rev.1,  sect. C,  Provisions related  to chemical  items,
para. 32, and sect. D, Provisions related to biological items, para. 38.

  5/  See S/22872/Rev.1 and Rev.1/Corr.1,  Introduction, para. 9, and  sect.
C, Obligations of Iraq, paras. 23, 25 and 26.







Annex II

Letter dated 17 July 1995 from the Executive Chairman of
the United Nations Special Commission addressed to the 
Chairman of the Security Council Committee established 
by resolution 661 (1990) concerning the situation      
between Iraq and Kuwait


  I  have  the  honour  to  refer  to the  proposal  for  the  mechanism for
export/import monitoring  under paragraph 7  of Security Council  resolution
715 (1991),  which has  been  submitted to  the Sanctions  Committee by  the
Special  Commission and  by the  International Atomic Energy  Agency (IAEA),
and which is currently  under consideration by it.  In connection with  that
proposal, certain delegations  have requested information on the  modalities
that  will be  followed  by  the Special  Commission and  IAEA in  Iraq when
implementing that mechanism in Iraq.

  The Security Council  has, on a number  of occasions, confirmed  that sole
responsibility for  carrying  out their  mandates  in  Iraq rests  with  the
Special Commission and IAEA  (e.g., statement to the press by the  President
of the Council  of 24 September  1991 and statement by the  President of the
Council of  28 February 1992 (S/23663)).   Nevertheless,  the Commission and
IAEA have  kept the  Council fully  informed of  their activities  and their
modus operandi.    In  keeping  with this  practice,  it  may be  useful  to
indicate the general principles that would  be followed in implementing  the
mechanism in Iraq.

  An Office of export/import specialists will  be established in the Baghdad
Monitoring  and Verification  Centre and  will  serve as  an  administrative
clearing-house  for  communications  from  Iraq  regarding the  notification
forms that it is required  to submit.  This Office and the Centre will  also
implement inspections  within Iraq  to ensure  that the  mechanism is  being

complied with.  These inspections  will be  as vigorous  as is necessary  to
ensure  that no  violations of  the  export/import  regime occur.   In  this
regard, the Commission and  IAEA intend to rely  on their full  rights under
the   relevant  Security  Council  resolutions,  including  resolutions  687
(1991),  707 (1991)  and 715  (1991), the plans  for ongoing  monitoring and
verification  (S/22871/Rev.1   and  S/22872/Rev.1   and  Rev.1/Corr.1),  the
privileges  and immunities as set  forth in the  exchange of letters between
the United Nations  and Iraq of  6 and  17 May 1991  and the decision to  be
taken by the Security Council approving the mechanism.
  
  Inspections under  the mechanism will take  place not only at the declared
end-user  sites, where notified  items will  be tagged,  as appropriate, and
entered into  the site protocols, but  will also be  conducted anywhere else
in Iraq  where there is reason  to believe that  notified items or  dual-use
items in respect of which there should have  been notification may be found.
To  ensure Iraqi compliance, the  monitoring will be carried out in whatever
ways  yield  the most  effective  results,  whether  by monitoring  end-user
sites, or border crossings or  other locations.  For example, if information
available to the Commission and experience proves  this to be effective, the
Commission may  station its  personnel at  key points,  including points  of
entry  and of  customs inspection  in Iraq.    The  extent to  which various
inspection rights will be  exercised in Iraq will depend, inter alia, on the
degree of Iraqi cooperation  in carrying out the  mechanism and the findings
of  the  Commission  and  IAEA  regarding   the  Iraqi  customs  and  import
procedures.

  I believe that, when the Sanctions Committee is  in a position to  forward
the proposal for  the mechanism to  the Security Council, as  the tripartite
proposal called for  in paragraph 7 of resolution  715 (1991), it should  be
accompanied,  for purposes of  information, by  this letter  setting out, in
general  terms, the  modalities which  it is  intended will  be  followed in
implementing the mechanism.


                                               (Signed)  Rolf EKEUS
                                                  Executive Chairman of the
                                              United     Nations     Special
Commission


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