VZCZCXYZ0036
OO RUEHWEB

DE RUEHC #7384 1811702
ZNR UUUUU ZZH
O 300241Z JUN 09
FM SECSTATE WASHDC
TO USMISSION USUN NEW YORK IMMEDIATE 6689-6691

UNCLAS STATE 067384 
 
SIPDIS, SENSITIVE 
 
C O R R E C T E D C O P Y  (CLEARANCE) 
 
 
E.O. 12958: N/A 
TAGS: EFIN ECON PREL PARM KNNP
SUBJECT: U.S. DESIGNATION OF NAMCHONGANG TRADING 
CORPORATION AND HONG KONG ELECTRONICS 
 
REF: CHALMERS-HARRIS EMAIL, JUNE 29, 2009. 
 
¶1. (U) This is an action request.  Please see paragraph 3. 
 
 
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      REPEAT  GREEN  LIVE MSG 
SUMMARY AND BACKGROUND 
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¶2. (SBU) The United States will designate two North 
Korean entities under E.O. 13382 (Blocking the Property 
of Weapons of Mass Destruction Proliferators and their 
Supporters) on June 30, 2009 at 12:00 P.M.  The 
designations are consistent with the aims of UNSCRs 1718 
and 1874 and add to continuing U.S. efforts to prevent 
North Korean entities of proliferation concern from 
accessing financial and commercial markets that could 
aid the regimes efforts to develop nuclear weapons and 
the missiles capable of delivering them.  USUN should 
provide P5+2 counterparts with advance notice of these 
actions no earlier than 9:00 AM on June 30 and no later 
than 12:00 PM.  Both entities (Namchongang Trading 
Corporation and Hong Kong Electronics) were included in 
the package of designations submitted by the United 
States on June 19 to the UNSCR 1718 Sanctions Committee 
for designation pursuant to UNSCR 1874. 
 
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ACTION REQUEST/OBJECTIVES 
------------------------- 
 
¶3. (SBU) USUN is requested to pursue the objectives 
listed below.  A Department Media Note and a Department 
of the Treasury Media Note on the designations will be 
released simultaneously with the designation at 12:00PM, 
June 30, 2009.  USUN may draw on the final version of 
the media notes (reftel) and the press guidance and 
additional background in paragraph 4. 
 
-- Inform P5+2 officials of the U.S. designations under 
E.O. 13382 and draw from the following background, 
including identifier information: 
 
¶1. NCG is a North Korean nuclear-related company in 
Pyongyang that has been involved in the purchase of 
aluminum tubes and other equipment specifically suitable 
for a uranium enrichment program since the late 1990s. 
Identifier information is as follows:  Namchongang 
Trading Corporation, (a.k.a. NCG, a.k.a. Namchongang 
Trading, a.k.a. Nam Chon Gang Corporation, a.k.a. 
Nomchongang Trading Co.), Pyongyang, North Korea. 
 
¶2. Hong Kong Electronics, located in Kish Island, Iran, 
has provided support to North Koreas Tanchon Commercial 
Bank and Korea Mining Development Trading Corporation, 
which were both designated by the UNSCR 1718 Sanctions 
Committee.  Identifier information is as follows: HONG 
KONG ELECTRONICS (a.k.a. Hong Kong Electronics Kish Co), 
Sanaee St., Kish Island, Iran [NPWMD] 
 
-- Note that the designations are consistent with the 
aims of UNSCRs 1718 and 1874 and add to continuing U.S. 
efforts to prevent North Korean entities of 
proliferation concern from accessing financial and 
commercial markets that could aid North Koreas efforts 
to develop nuclear weapons and the missiles capable of 
delivering them. 
 
-- Remind P5+2 officials that entities designated under 
E.O. 13382 are prohibited from engaging in all 
transactions with any U.S. person and are subject to a 
U.S. asset freeze. 
 
-- Urge P5+2 officials to investigate whether these 
entities have a presence in their jurisdiction and, if 
so, request that they take steps to prevent asset flight 
and ensure that persons or entities within their 
territory do not engage in transactions with these 
entities. 
 
-- If asked whether these designations mean that the two 
top U.S. priorities under UNSCR 1874 for designations in 
the 1718 Committee are Namchongang Trading Corporation 
and Hong Kong Electronics, note that a) the U.S. 
believes it is important that the 1718 Committee 
designate these two entities given their role in North 
Koreas WMD programs, b) stress that our domestic 
designations are conducted on a parallel track, and that 
c) we expect to designate additional entities as well. 
We want to continue our discussions in the 1718 
Committee to reach agreement on the designation of 
additional individuals, entities and goods before the 
July 12 deadline. 
 
¶4. (U) ISN Press Guidance. June 30, 2009. 
 
Designation of Two Additional North Korean Entities 
Pursuant to Executive Order 13382 
 
Q:  What is the significance of these designations and 
why now? 
 
A: These designations target two key elements of North 
Koreas nuclear and missile network and will help to 
disrupt North Koreas ability to procure, develop, and 
proliferate WMD capabilities. 
 
A: The United States is sending a clear message, in 
conjunction with our efforts at the United Nations, that 
North Koreas nuclear and missile tests and 
proliferation activities are unacceptable and that there 
are consequences for these actions. 
 
Q: Will these designations have any impact? 
 
A: These measures will highlight the proliferation- 
related activities in which these firms are engaged and 
reduce their ability to engage in business activities 
worldwide.  Namchongang Trading Corporation and Hong 
Kong Electronics will be placed on the U.S. Department 
of Treasurys Specially Designated Nationals and Blocked 
Persons List maintained by the Treasury Departments 
Office of Foreign Assets Control (OFAC), which is used 
by financial institutions worldwide to screen 
transactions.  The ultimate result will be limiting 
their access to the international financial system. 
 
Q: Will these designations impact ordinary North Korean 
people? 
 
A: No, these measures are targeted at entities involved 
in WMD proliferation. 
 
Q:  Will the U.S. propose that these entities also be 
designated under UNSCR 1874? 
 
A:  UNSCR 1874 tasked the Security Councils DPRK 
Sanctions Committee (the 1718 Committee) with 
designating new individuals, entities, and goods within 
thirty days of the resolutions adoption (i.e., by July 
12).  Committee deliberations are ongoing.  We hope the 
1718 Committee will approve a robust package of 
designations before the deadline set by the Security 
Council. 
 
IF PRESSED: Committee deliberations are strictly 
confidential (and ongoing). We will not discuss what 
names have been proposed by the United States or other 
committee members. 
 
¶Q. Will the U.S. designate the additional entities? 
 
A: The U.S. has an ongoing process in place to continue 
to identify entities and individuals of proliferation 
concern for designation under E.O. 13382. 
 
IF ASKED: 
Q:  Do we think North Korea is transferring WMD to 
Burma? 
 
A: We do not comment on intelligence matters or military 
operations. 
 
If pressed: the United States will enforce UNSCR 1874. 
We expect that other UN member states will do the same. 
 
Additional Background:  On Tuesday, June 30, the 
Department of State will designate North Koreas 
Namchongang Trading Corporation under Executive Order 
13382 for its support to North Koreas nuclear program. 
At the same time, the Department of Treasury will be 
designating Hong Kong Electronics (located in Kish 
Island, Iran) under E.O. 13382 for its support to the 
Korea Mining Development Trading Corporation (KOMID) and 
Tanchon Commercial Bank, two previously designated North 
Korean entities. 
 
E.O. 13382 was signed by the president on June 29, 2005. 
It is an authority aimed at freezing the assets of 
proliferators of weapons of mass destruction and their 
supporters.  Designations under E.O. 13382 prohibit all 
transactions between the designees and any U.S. person 
and freeze any assets of the designees that are in the 
United States or in the possession or control of U.S. 
persons. 
 
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REPORTING DEADLINE 
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¶5.  (U) Please report any response within seven days of 
receipt of this cable.  Please slug replies for ISN, T, 
TREASURY, and EAP/K.  Please use SIPDIS caption on all 
responses. 
 
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POINT OF CONTACT 
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¶6.  (U) Questions may be directed to ISN/CPI Jennifer 
Chalmers, 202-647-9715. 
 
¶7.  (U) Department thanks USUN for its assistance. 
CLINTON