TNAG-2029-FCO40-2891-Hong-Kong-freezing-of-Kuwaiti-and-Iraqi-assets-1990 — Page 234

Mr Burns

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P A Penfold, WIAD

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16 August 1990 See Below

IRAQ/KUWAIT: IMPLEMENTATION OF UK SANCTIONS IN THE DEPENDENT TERRITORIES

1. A meeting chaired by WIAD was held on 15 August to clarify procedures for the implementation in the Dependent Territories of sanctions against Iraq and Kuwait. We emphasised our own and the US concern that our DTs should not be weak links in the sanctions chain. HMG would have to answer internationally to any sanctions busting that took place in our territories.

The

2. Legal Advisers briefed the meeting on the two Orders in Council passed last week which affected the DTS. Treasury had already taken action prior to the UN Security Council resolution to control the transfer of Iraqi/Kuwaiti assets. This measure had now by Order in Council been extended to all DTs except Gibraltar and Bermuda which had enacted their own legislation. The second Order in Council extended to the DTS the UN trade embargo; under this Order the power to issue licences, which in the UK rests with the DTI, was vested in the Governor. It was now essential that DT governments be given as much guidance as possible from the Bank of England and the DTI to ensure that their policies on the granting of permission for credit transfers and on the issue of licences were consistent with those of the UK.

3. The Bank of England representatives pointed out that Bank of England guidelines on permission for credit transfer had already been issued to DTs. Governors should be encouraged to distribute these guidelines as widely as possible. The Bank of England's Emergency Unit was willing to advise on difficult cases which fell within grey areas'. DT governments could contact them directly on particularly urgent cases.

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4. The DTI representative informed the meeting that the DTI had not yet prepared a similar guidance note, but one would be drawn up. However they were prepared to provide on a weekly basis a detailed list of general

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