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DE RUEHTC #0244/01 1041505
ZNR UUUUU ZZH
O 141505Z APR 09
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 2746
INFO RUEAIIA/CIA WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RHEBAAA/DEPT OF ENERGY WASHDC PRIORITY
RUEKJCS/SECDEF WASHINGTON DC PRIORITY
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UNCLAS THE HAGUE 000244 
 
SENSITIVE 
SIPDIS 
 
STATE FOR ISN/CB, VCI/CCA, L/NPV, IO/MPR 
SECDEF FOR OSD/GSA/CN,CP> 
JOINT STAFF FOR DD PMA-A FOR WTC 
COMMERCE FOR BIS (BROWN AND DENYER) 
NSC FOR LUTES 
WINPAC FOR WALTER 
 
E.O. 12958: N/A 
TAGS: PARM PREL CWC
SUBJECT: CWC:  INDUSTRY CLUSTER MEETINGS, APRIL 1-2, 2009 
 
REF: A. THE HAGUE 99 
     ¶B. FACILITATOR'S DRAFT DECISION ON 2A/2A* LOW 
        CONCENTRATIONS (03/25/09) 
     ¶C. STATE 30848 
 
This is CWC-20-09. 
 
¶1. (U) SUMMARY:  Two of the three Industry Cluster 
consultations at the OPCW on April 1-2 saw a 
continuation of discussions from the last Industry 
Cluster in February (ref A).  Little progress was 
made on either Schedule 2A/2A* low concentrations 
or enhancements to declarations of Other Chemical 
Production Facilities (OCPFs).  The third 
consultation focused on a presentation by the 
Technical Secretariat assessing the revised OCPF 
site selection methodology introduced in 2008. 
While many delegations called for the resumption of 
consultations on finalizing the OCPF site selection 
methodology, no one has come forward to take on the 
Herculean task of facilitating the consultations. 
Full details follow.  END SUMMARY. 
 
------------------------------- 
OCPF SITE SELECTION METHODOLOGY 
------------------------------- 
 
¶2. (U) On April 1, Algerian Ambassador Benchaa Dani 
(Vice Chair for Industry Issues) chaired the first 
of three Industry Cluster meetings and announced 
that this would be his last meeting as Vice Chair. 
The Director-General (DG) welcomed the chance to 
discuss the results in 2008 of his modified site 
selection methodology for other chemical production 
facilities (OCPFs).  Citing his report from 
February (EC-5/DG.8), the DG reported that the 
results of the new methodology were as expected but 
noted that his assessment was only a progress 
report rather than a definitive conclusion on the 
methodology.  The DG said that the Technical 
Secretariat (TS) would need at least another year 
to fully analyze the effects of the modified 
methodology, suggesting that the results for 2009 
might not necessarily reflect those for 2008. 
 
¶3. (U) Stian Holen (Head, Policy and Review Branch) 
and Tsuyoshi Okuyama (Senior Policy Officer, PRB) 
made a presentation of the modified methodology, 
included statistics and tables included in the DG's 
February report.  Holen stressed that the 
methodology is an interim measure but that the TS 
will continue to use it to collect data for further 
monitoring and better evaluation.  German 
Ambassador Werner Burkart agreed with the DG's 
assessment that the methodology achieved its 
intended aim of shifting OCPF inspections to States 
Parties with more OCPFs and focusing on those sites 
of higher relevance, as reflected in their A14 
score.  Burkart also agreed that the TS should 
continue monitoring the methodology within 1-2 
years with the aim of developing a permanent 
methodology.  South Africa, Mexico, the Netherlands 
and U.S. Del echoed Germany's support for the TS to 
continue using and monitoring the methodology. 
 
¶4. (U) China stated that while the modified 
methodology is an improvement, it still needs 
further refinement.  China noted that it had 
received 13 OCPF inspections in 2008 compared to an 
average of two inspections per year under the 
previous methodology, and stressed the need for 
consultations on OCPF site selection methodology to 
resume as soon as possible.  China expressed hope 
that further improvements to the methodology would 
Qthat further improvements to the methodology would 
augment any enhancements to OCPF declaration forms 
and the introduction of sub-codes for bulk 
chemicals in eliminating all sites of lesser 
relevance.  Italy echoed China's call to resume 
consultations, noting that Italy had also been 
subject to more inspections under the modified 
methodology. 
 
¶5. (U) In response to questions raised by Spain, 
Okuyama noted that no States Parties reached the 
cap of 20 inspections for OCPFs and Schedule 3 
facilities in 2008.  He also said that the 
reinspection rate was kept at 5%, as under the 
previous methodology.  Responding to clarification 
requested by South Africa, Holen noted that the 
spread of inspections between sites of high, medium 
and low relevance (37%, 30% and 33%, respectively, 
in 2008) was a result of the methodology rather 
than an intended target.  Holen stressed that the 
methodology remains random and that all sites, 
regardless of relevance, are eligible for 
inspection. 
 
¶6. (U) Near the end of the meeting, Dani said that 
most delegations appeared to support the modified 
methodology and the TS's continued use of it.  Dani 
suggested two options for proceeding:  restarting 
consultations (as requested by China and Italy), 
and allowing the DG to present new initiatives to 
further improve the methodology.  The DG adamantly 
responded that the TS has no initiatives to 
introduce and will rather continue to monitor the 
current methodology.  He countered that States 
Parties should take up their responsibility of 
deciding on the final factor to be included in the 
site selection methodology.  Germany and South 
Africa both supported the DG's comments and echoed 
Dani's appeal for a facilitator to take up 
consultations on the final factor as soon as 
possible. 
 
¶7. (U) At the request of delegations, Okuyama made 
a brief presentation on the A14 value and how it is 
determined.  Holen promised to make both 
presentations from the meeting available on the 
OPCW's external server. 
 
------------------------- 
2A/2A* LOW CONCENTRATIONS 
------------------------- 
 
¶8. (U) Facilitator Giuseppe Cornacchia (Italy) 
opened his consultations on low concentrations for 
2A/2A* chemicals by introducing his recently- 
circulated draft decision (ref B, posted on the 
OPCW's external server).  Cornacchia explained that 
the preambular paragraphs were taken mostly from 
the previous facilitator's draft decision while the 
three operative paragraphs reflected his assessment 
of positions after the last few rounds of 
consultations.  He noted that not all thresholds 
were reflected in his draft decision but explained 
that he had not included the lower and upper 
extremes in an attempt to close the gap and move 
toward a compromise.  Cornacchia called on all 
delegations for continued flexibility. 
 
¶9. (U) Cornacchia recalled that in February Canada 
(supported by the UK, Germany and Italy) had 
requested the TS's analysis of sites declarable at 
different thresholds to be broken down between BZ 
and PFIB sites.  However, Cornacchia reported that 
the TS was unable to provide the requested 
breakdown due to confidentiality constraints.  He 
explained that the TS's data was based on 
inspection reports and the small number of sites 
made it impossible to present the data in an 
anonymous manner.  Again citing confidentiality 
concerns, Cornacchia also reported that the TS was 
Qconcerns, Cornacchia also reported that the TS was 
unable to provide information on the number of 
sites disposing PFIB onsite versus those disposing 
it offsite, as Germany had requested in February. 
 
¶10. (U) U.S. Delrep encouraged other delegations to 
shift their focus from technical to political 
aspects in order to reach a compromise.  Delrep 
thanked Cornacchia for his draft decision, noting 
it provided a good basis for discussion and offered 
a potentially viable solution.  The Netherlands 
echoed the U.S. call for moving away from technical 
discussions and stated that a decision is now a 
matter of political will.  Australia also welcomed 
the facilitator's draft and asked for an assessment 
of the impact of different thresholds, suggesting 
that States Parties voluntarily provide such 
information themselves.  Germany followed by asking 
how many sites would be declared at various 
thresholds (i.e., 5%, 10% and 20%) and stating it 
would happily provide the information and 
suggesting that the TS could release results 
anonymously to protect confidentiality. 
 
¶11. (U) The UK agreed with Germany's proposal but 
stressed that any survey should also show how many 
sites might no longer be declarable at various 
thresholds.  Italy, South Africa, China and South 
Korea also supported the idea of having a survey of 
the impact of different thresholds.  Bill Kane 
(Head, Industry Verification Branch) responded that 
the TS could produce and circulate a questionnaire 
for States Parties to answer voluntarily. 
 
¶12. (SBU) With momentum gathering behind the impact 
survey, Japan threw on the brakes by stating that 
delegations needed to discuss and consider the 
objective of a threshold.  Japan stated that the 
Convention stipulates that a threshold should be 
based on ease of recovery and that the focus of 
thresholds is one of industry regulation rather 
than non-proliferation or enhancing visibility of 
"dangerous" sites.  Japan noted that it was not 
against the questionnaire in principle; however, it 
asked how the survey results would be used.  Russia 
also questioned the legality of circulating such a 
questionnaire and suggested that States Parties 
were unlikely to provide information voluntarily. 
After more discussion on the survey, Cornacchia 
announced that he would consult informally with 
delegations on how to proceed and take up the issue 
at the next consultation in May. 
 
¶13. (U) Cornacchia then shifted discussion to his 
draft decision.  Delegations quickly went through 
the preambular paragraphs raising a few questions 
and suggesting minor changes.  After discussion on 
the specific thresholds suggested in the first 
operative paragraph, delegations agreed with the UK 
suggestion that no number be written but that it be 
left open-ended and filled in once a threshold was 
agreed.  Delegations decided on a similar 
arrangement for the dates for implementation and 
review listed in operative paragraphs two and 
three, respectively. 
 
¶14. (SBU) While the consultation did not make much 
progress, South African delegate Marthinus van 
Schalkwyk reinforced his comments from February 
(reported in ref A) by saying that the issue of 
choosing a threshold boils down to the number of 
inspections that States Parties are willing to 
take.  He said that a lower threshold would mean 
more inspections for some States Parties due to 
Qmore inspections for some States Parties due to 
their having to declare more facilities.  Van 
Schalkwyk suggested that some States Parties were 
trying to avoid a few extra Schedule 2 inspections 
while insisting on increasing OCPF inspections. 
 
----------------------------- 
OCPF DECLARATION ENHANCEMENTS 
----------------------------- 
 
¶15. (U) Facilitator Marthinus van Schalkwyk's 
(South Africa) consultation on enhancing OCPF 
declarations began with a presentation by Bill Kane 
(Head, IVB) on the TS's proposed values for the new 
"R" variable to be included in the A14 site 
selection algorithm.  Kane's presentation 
reiterated the information included in the TS's 
non-paper distributed to delegations in advance of 
the consultation.  Kane explained that the values 
were based on an intuitive sense of different 
sites' relative risk rather than on a purely 
mathematical basis. 
 
¶16. (U) U.S. Delrep noted that the proposed "R" 
value seemed to focus on shifting more sites of 
lesser relevance into the lower risk category 
rather than pushing sites of greater relevance into 
the higher risk category.  Kane responded that the 
net effect would be to highlight higher risk sites 
by increasing the number of lower risk sites. 
Addressing the spread of OCPF inspections among 
higher-, medium- and lower-risk sites, Kane said 
that the TS does not aim for a specific allocation 
between the three categories.  However, he did 
admit that the change in A14 values due to "R" 
would only serve to reduce a site's probability of 
being selected for inspection and that this could 
result in a larger proportion of higher- and 
medium-risk sites being selected. 
 
¶17. (U) Drawing on guidance (ref C), Delrep also 
noted the analysis of the seven U.S. OCPF sites 
inspected in 2008 showed that the additional 
declaration questions would not have resulted in 
more relevant sites being inspected.  Delrep went 
on to request the TS conduct a survey of all 118 
OCPFs inspected in 2008 to determine the net effect 
of the proposed declaration changes.  Other 
delegations and van Schalkwyk agreed the U.S. 
proposal would be useful, and Kane said he would 
try to present the results at the next Industry 
Cluster consultation in late May. 
 
¶18. (U) The UK and Germany suggested reducing the 
number of additional questions on declaration forms 
by focusing only on plant characteristics and 
asking whether sites have batch or continuous 
processes.  Germany also noted it would be best to 
focus on production processes, rather than on 
purification or other concomitant processes.  Kane 
agreed that in the case of a plant with a batch 
reactor and continuous downstream it would be 
better to focus on the batch production 
characteristic.  However, drawing on its own 
experience, Switzerland noted a clear advantage to 
having three boxes for each question (i.e., batch, 
continuous or both; and dedicated, multi-purpose or 
both) in order to reduce any possible confusion on 
how to answer questions for sites with mixed 
characteristics and equipment. 
 
¶19. (U) China raised the need for clear definitions 
of terms used, suggesting that by checking the 
wrong box on the declaration form a site's 
selection probability could vary by up to five 
times.  Referring to a previous German comment on 
timely declarations, India stated that timeliness 
and accuracy of declaration information is more 
important than focusing on plant characteristics or 
the types of production equipment used.  Van 
Schalkwyk agreed that timely and correct 
QSchalkwyk agreed that timely and correct 
declarations are important and said he hoped that 
budget consultations would help sharpen minds and 
provide incentive to reach agreement on improving 
the OPCW declaration regime. 
 
¶20. (U) Switzerland stated it already has added 
both the voluntary SITC-based subcodes and the 
questions on site characteristics and production 
equipment to its OCPF declaration forms.  The Swiss 
delegate noted that Swiss industry had not been 
confused or burdened by the modifications.  China 
suggested that States Parties with a larger number 
of facilities might have a different experience to 
that of Switzerland.  Responding to a question 
raised by U.S. Delrep, the Swiss delegate said 
based on a study of their 35 declarable OCPFs, 
Switzerland did not expect the new data to result 
in a change in the number of inspections 
Switzerland would receive. 
 
¶21. (U) Iran intervened to state that neither 
process nor equipment characteristics are included 
in the Convention and that any changes to the 
intent of the Convention clearly went beyond the 
OPCW's mandate.  The Netherlands responded that 
improvements to the OCPF inspection regime are not 
outside of the Convention, and van Schalkwyk 
reminded delegations that the Verification Annex 
has been amended twice already, reflecting that 
industry is not static and that technical changes 
are possible.  Iran went on to say that, despite TS 
claims to the contrary, differentiation between 
site characteristics would not resolve fundamental 
problems with OCPF inspections.  Iran stated that 
the relevance of facilities to the object and 
purpose of the Convention is the issue and insisted 
that the focus should be on correcting errors in 
declarations, insuring timely submission of 
information and training national authorities on 
proper declaration methods. 
 
¶22. (U) Van Schalkwyk concluded the consultation by 
noting that the increase globally in OCPFs 
represents a challenge to the OCPW's verification 
regime.  He noted that the proposed OCPF 
declaration enhancements are an attempt to provide 
a technical fix.  Van Schalkwyk also reiterated the 
link between his consultation and the OPCW's annual 
budget, stating that lack of progress in his 
consultation would have implications for budget 
negotiations in the autumn. 
 
----------------------------------------- 
MEETING WITH INDUSTRY VERIFICATION BRANCH 
----------------------------------------- 
 
¶23. (U) Following the Industry Cluster 
consultations, visiting Commerce officer Hung Ly 
and Delrep met with Bill Kane (Head, IVB) and 
Violeta Fernandez (Senior Industry Officer, IVB) to 
discuss issues related to recent industry 
inspections in the United States.  Ly noted some 
timing problems during sequential inspections, and 
Fernandez said they would look at options to 
alleviate time constraints, including the 
possibility of adding an extra team member on 
sequential inspections.  Ly also offered to have a 
Commerce representative brief new inspection 
personnel on the unique way in which the U.S. 
delineates plant sites; Kane agreed that a 1-2 hour 
briefing on the margins of the Executive Council 
session in July could be beneficial, especially 
considering the high turnover in both Inspectorate 
and Verification divisions since the last such 
briefing. 
 
¶24. (U) Turning to sampling and analysis (S&A), Ly 
said that difficulties in shipping S&A equipment by 
Qsaid that difficulties in shipping S&A equipment by 
air necessitated relying on road transport, meaning 
that S&A equipment would not reach a site on the 
West Coast until at least a day or two after an 
inspection started.  Ly noted previous TS guidance 
that inspections could not start until all 
inspection equipment was on site, and he asked if 
this reflected current TS thinking and if there was 
any legal basis for it.  Kane suggested that an 
inspection could begin without the S&A equipment, 
as long as the analysis could be done at the end of 
the inspection; he promised to discuss the matter 
with the Legal Advisor and the Policy and Review 
Branch. 
 
¶25. (U) BEIK SENDS. 
 
GALLAGHER