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New US Sanctions Imposed on N. Korean Firm Allegedly Selling Missiles to Yemen - 2003-07-25

the trading ban against Changgwang Sinyong will also apply to the government in Pyongyang as well

The United States is imposing new trade sanctions against North Korea stemming from a shipment of Scud missiles bound for Yemen intercepted at sea last December. Yemen was allowed to take possession of the missiles and will not be penalized for its role in the transaction.

The sanctions, announced Friday in the U.S. government's official journal the Federal Register, will apply to the North Korean export company Changgwang Sinyong, and more broadly to the North Korean government under the 1979 U.S. Export Administration Act.

The action will have the practical effect of extending an existing ban on U.S. dealings with Changgwang Sinyong, which would have expired in about two years, until March of 2007.

The company has functioned as the overseas sales agent for the North Korean missile industry and has been cited previously for violations of both the 1979 export act and a similar U.S. law penalizing foreign firms that sell missiles and weapons-of-mass destruction technology to Iran.

The latest penalty stems from a shipment of 15 Scud missiles found hidden beneath sacks of cement aboard a North Korean ship last December that was stopped by a Spanish Navy anti-terrorism patrol in the Arabian sea.

The vessel was turned over to the United States Navy, and U.S. officials determined that the shipment was bound for Yemen.

The incident triggered an intensive round of U.S.-Yemeni diplomatic contacts and an eventual Bush administration decision to allow the missile delivery to go forward.

Briefing reporters, State Department spokesman Richard Boucher said the decisions to permit the shipment and not to penalize Yemen under the U.S. law, were made in light of what he said was "excellent" state of U.S. relations with that government, which promised at the time to cease its missile relationship with Pyongyang.

"We have assurances that this was the last part of the shipment, and there will be no further shipment," he said. "And in consideration of our relationship, our cooperation on terrorism, and consistent with the law, we're not imposing sanctions on Yemen for this activity at this time."

Because North Korea does not have a market economy, the trading ban against Changgwang Sinyong will also apply to the government in Pyongyang as well.

Among other things, parties cited as violators may not do business with the United States government or be licensed to purchase high-technology U.S. goods.