According to a December 15, 2009 report by the Wisconsin Project on Nuclear Arms Control, “lax enforcement of US sanctions is allowing Chinese companies to continue to ship goods to the United States even after being hit with an import ban for proliferation to Iran.” The Wisconsin Project report notes that there have been several instances in which two Chinese companies, sanctioned for arming Iran, have managed to evade import bans. One of the companies, China Precision Machinery Import-Export Corporation (CPMIEC), supplied missile technology to Iran and was sanctioned under the Iran Nonproliferation Act and, later, Executive Order 12938, subjecting CPMIEC to an import ban that remains in effect today. CPMIEC was also penalized under Executive Order 13382, which froze CPMIEC’s assets under US jurisdiction and banned transactions between CPMIEC and US parties. Nonetheless, the Wisconsin Project reports that US companies have been importing prohibited goods from two CPMIEC subsidiaries since 2006 and that “the US government has never provided the names or addresses of any such CPMIEC subsidiaries, making it difficult for American buyers to figure out their identities and comply with the law.” The report also notes that LIMMT Economic and Trade Company, Ltd. has also managed to circumvent US trade restrictions. LIMMT has been the subject of US government sanctions—including Executive Order 13382 and Executive Order 12938, which banned LIMMT from importing goods into the United States—for its proliferation-related trade with Iran. The Wisconsin Project report alleges that LIMMT, like CPMIEC, uses aliases in order to export to customers in the United States. According to the Wisconsin Project, “without adequate personnel and resources devoted to enforcing nonproliferation sanctions, it is difficult to see how the prohibitions against even ‘serial proliferators’ like CPMIEC and LIMMT can be real deterrents [and] these prohibitions will continue as mostly symbolic gestures, and the companies helping Iran will continue to evade them.”
Register Now As you are not an existing subscriber please register for your free daily legal newsfeed service.Register
If you have any questions about the service please contact firstname.lastname@example.org or call Lexology Customer Services on +44 20 7234 0606.
Report finds Chinese companies evading US sanctions, import bans
- White & Case LLP
- Christopher F. Corr, Nicole E. Erb and Richard J. Burke
- China, USA
- February 26 2010
If you are interested in submitting an article to Lexology, please contact Andrew Teague at email@example.com.
PHD, a division of The Fuel Logistics Group (Pty) Ltd