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Textiles, Fuel, Cargo Inspection Among Tougher Sanctions on North Korea

Thursday, September 14, 2017
Sandler, Travis & Rosenberg Trade Report

The United Nations Security Council has unanimously approved a resolution imposing tighter sanctions on North Korea following its most recent nuclear weapons test and its violation of eight UNSC resolutions dating back to 2006. A UNSC press release states that the new sanctions, which bring to 90 percent the amount of North Korean exports that are now fully prohibited, include the following.

- ban on imports of North Korean textiles, including fabrics and partially completed apparel, beginning in 90 days (approximately Dec. 11)

- call for closer inspections of cargo ships that may be carrying prohibited cargo to or from North Korea

- limit on the direct or indirect supply, sale, or transfer of refined petroleum products to North Korea to 500,000 barrels between Oct. 1 and Dec. 31 and two million barrels annually thereafter

- ban on the direct or indirect supply, sale, or transfer of all condensates and natural gas liquids to North Korea

- general restriction on the amount of crude oil each UN member can supply, sell, or transfer to North Korea to the amount it provided in the previous 12 months

- ban on UN members providing work authorizations for North Korean nationals unless certain criteria are met

- ban on the opening, maintenance, and operation of all joint ventures with North Korean entities or individuals and requirement for existing JVs to be closed within 120 days

According to the press release, the textile import ban is expected to reduce North Korean revenues by $800 million. U.S. Ambassador to the UN Nikki Haley added that the resolution will reduce North Korea’s supply of gas, diesel, and heavy fuel oil by nearly 50 percent and ban exports of products that could be used as a substitute for those fuels. Other officials indicated that additional sanctions are possible unless North Korea ceases its nuclear weapons and missile testing and other provocations.

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