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which the European shipping nations have been at loggerheads with the United States for many years. I doubt whether the United States could seriously expect the Community, against this background, to accept their wording on this point.
the words or on charter to their nationals' raise other problems of a mainly practical nature. The fact is that the liner shipping to Iran, like elsewhere, depends upon regularity of service. Once business is allowed to go elsewhere there can be little prospect of getting it back. The long term interests of British shipowners therefore depend upon preventing their business being diverted to their (non sanctions applying) competitors. There is no doubt, for example, that the Soviet Union's merchant marine which has considerable spare capacity due to the restrictions currently imposed at US ports, would be ready and able to step in and pick up contracts.
Another area where UK shipping would be substantially affected, if it were covered by sanctions, would be in the 'cross trades between third countries and Iran. It is not entirely clear to me whether the Community is committed on this point, since the draft Resolution if passed by the UN would have been of general application by all states in contrast to the more limited scope of the present exercise. There is no doubt, however, that the overall scope of the sanctions would be greatly widened if the shipping of those countries applying sanctions were prohibited from engaging in cross trading to Iran. The point to bear in mind is that the UK, as a major shipping country, has more to lose than any of the other countries concerned and it would therefore be unwise of us to take the lead. I note from the Record of the last meeting of the Working Party on Iran that this category of sanctions 'give rise to quite intricate problems. It is clear that our Community partners have consi- derable doubts. So should we, and we should also bear in mind Ministers' undertaking to Parliament not to go further than our competitors, and not to hand business to them.
4. To sum up, the brief for officials, concerned in drafting the Orders for Parliament, and in comparing these drafts with the provisions of our Community partners in the Working Group should seek if possible to limit the shipping sanctions, firstly to end-to-end shipping by UK flag ships and, if that fails, to
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