VZCZCXYZ0002
OO RUEHWEB

DE RUEHC #6229 3440055
ZNR UUUUU ZZH
O 100054Z DEC 09
FM SECSTATE WASHDC
TO RUEHDS/USMISSION USAU ADDIS ABABA IMMEDIATE 0000
INFO RUEHDS/AMEMBASSY ADDIS ABABA IMMEDIATE 0000
RUCNDT/USMISSION USUN NEW YORK IMMEDIATE 0000
RUEHBS/USEU BRUSSELS IMMEDIATE

UNCLAS STATE 126229 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PREL AORC ODIP
SUBJECT: DEMARCHE REQUEST: NYC TO IMPOSE TAX ON AU 
PROPERTIES 
 
¶1.  (U) This is an action request. 
 
¶2.  (SBU) Background.  The City of New York notified the U.S. 
Mission to the United Nations (USUN) on December 2 that both 
the European Union (EU) and African Union (AU) Observer 
Missions to the UN are obliged to pay municipal property tax. 
 After examining the City's claims, the Office of the Legal 
Adviser agrees the two missions are not clearly entitled to a 
tax exemption.  The EU's situation can likely be remedied 
with a new executive order.  Since the AU's privileges and 
immunities stem from different statutory authorization, the 
Department may need to pursue a technical legislative fix in 
addition to a new executive order.  We believe Congress will 
look favorably upon a technical fix of this nature, although 
it will take some time to pass the new legislation.  The City 
plans to notify the EU and AU of their new tax liability 
during the week of December 7. 
 
¶3.  (SBU) Using the points contained in para 4, AF PDAS 
Donald Yamamoto will provide advance notice of the City's 
intent to the AU Perm Rep in New York at 5:00 p.m. on 
Wednesday, December 9.  End Background. 
 
¶4.  (SBU) Action Request:  Acting no earlier than PDAS 
Yamamoto's delivery of notice to the AU Permanent 
Representative, post is instructed to demarche the African 
Union Commission at the highest appropriate level using the 
points in para 5, and deliver the non-paper contained in para 
6 which explains the legal circumstances of this situation. 
Post should not provide a written copy of the points 
contained in para 5.  End Action Request. 
 
¶5.  (SBU) Talking points: 
 
-- We understand the City of New York may soon notify your 
Mission to the United Nations in New York that the AU Mission 
to the UN is subject to municipal property taxation by the 
City. 
 
-- Our legal counsel advised us on Friday, December 4, that, 
under existing legislation and the relevant executive order, 
the AU Observer Mission to the UN is not entitled to claim a 
tax exemption, therefore we are unable to contest the City's 
determination. 
 
-- The Department is researching options to restore the AU 
Observer Mission's tax exempt status.  The Bureau of African 
Affairs intends to pursue the most expeditious remedy that 
will resolve the situation. 
 
-- I want to be clear that the present situation does not 
affect the personal privileges and immunities enjoyed by the 
AU Mission's staff, which will continue unchanged. 
 
-- Please be assured that we are working to evaluate this 
situation as quickly as possible.  We will keep you updated 
as the process proceeds. 
 
-- In the meantime, if your Mission receives a notice or a 
bill from the City of New York, we understand that you are 
not required to make immediate payment as the City is seeking 
tax payments only prospectively. 
 
-- If Raised:  The EU's Mission was formed at a much earlier 
date, and its privileges and immunities are authorized by 
different legal instruments.  We are not certain how we will 
address the EU's situation, which is different from that of 
the African Union Mission. 
 
¶5.  (SBU) Non-paper: 
 
Non-paper on the Privileges and Immunities of the UN Observer 
Mission of the African Union Relevant to New York City 
Property Tax 
 
22 U.S.C. section 288f-2 provides, in pertinent part, as 
follows: 
 
Section 288f-2.  Organization of African Unity; extension of 
privileges, exemptions, and immunities 
 
(a) The provisions of this subchapter may be extended to the 
African Union . . .  in the same manner, to the same extent, 
and subject to the same conditions, as they may be extended 
to a public international organization in which the United 
States participates pursuant to any treaty or under the 
authority of any Act of Congress authorizing such 
participation or making an appropriation for such 
participation. 
 
(b) Under such terms and conditions as the President shall 
determine, consistent with the purposes of this subchapter, 
the President is authorized to extend, or enter into an 
agreement to extend, to the African Union Mission to the 
United States of America, and to its members, the privileges 
and immunities enjoyed by diplomatic missions accredited to 
the United States, and by members of such missions, subject 
to corresponding conditions and obligations. 
 
-- Subsection (a) thus authorized the President to extend to 
the African Union (AU) the benefits of the International 
Organizations Immunities Act (IOIA), which include immunity 
from property tax only when such tax is imposed by the 
federal government, not by a state. The President exercised 
this authority when he issued Executive Order 13377 on April 
13, 2005.  In relevant part, this EO states: "The African 
Union is hereby designated as a public international 
organization entitled to enjoy the privileges, exemptions, 
and immunities provided by the International Organizations 
Immunities Act."  As a result, the AU's Observer Mission to 
the UN and its personnel enjoy all the privileges and 
immunities of the IOIA.  These benefits do not, however, 
include an exemption from New York City property tax. 
 
-- Subsection (b), which was added to the statute in 2007, 
authorized the President to extend privileges and immunities 
to the newly established bilateral mission of the AU to the 
United States equivalent to those enjoyed by the bilateral 
diplomatic missions of foreign States.  This the President 
did by Executive Order 13444, on September 12, 2007, which 
provides in pertinent part: "By the authority vested in me as 
President by the Constitution and the laws of the United 
States of America, including section 7(a)(2) of the 
Department of State Authorities Act of 2006 (Public Law 
109-472), I hereby extend to the African Union Mission to the 
United States of America, and to its members, the privileges 
and immunities enjoyed by diplomatic missions accredited to 
the United States, and by members of such missions, subject 
to corresponding conditions and obligations."  As a result of 
this special legislation and order, the AU's bilateral 
mission in Washington enjoys, inter alia, exemption from 
virtually all forms of 
real property tax, something its UN Observer Mission in New 
York does not. 
 
-- Because 22 U.S.C. section 288f-2 does not give the 
President the authority to extend the same benefits to the AU 
Observer Mission as are enjoyed by the AU bilateral mission, 
the statute would have to be amended to achieve that end. 
Once an amended statute gives the President additional 
authority, he would be in a position to issue a new Executive 
Order giving those privileges and immunities, including 
exemption from property taxation, to the AU's Observer 
Mission in New York. 
CLINTON