Council Regulation (EU) 2017/1509 of 30 August 2017 concerning restrictive measures against the Democratic People's Republic of Korea and repealing Regulation (EC) No 329/2007

CHAPTER I

Definitions

Article 1

This Regulation shall apply:

(a) within the territory of the Union;

(b) on board any aircraft or any vessel under the jurisdiction of a Member State;

(c) to any person inside or outside the territory of the Union who is a national of a Member State;

(d) to any legal person, entity or body, inside or outside the territory of the Union which is incorporated or constituted under the law of a Member State;

(e) to any legal person, entity or body in respect of any business done in whole or in part within the Union.

Article 2

For the purposes of this Regulation, the following definitions apply:

(1) ‘branch’ of a financial or credit institution means a place of business which forms a legally dependent part of a financial or credit institution and which carries out directly all or some of the transactions inherent in the business of financial or credit institutions;

(2) ‘brokering services’ means: (a) the negotiation or arrangement of transactions for the purchase, sale or supply of goods and technology or of financial and technical services, including from a third country to any other third country; or (b) the selling or buying of goods and technology or of financial and technical services, including where they are located in third countries for their transfer to another third country;

(3) ‘claim’ means any claim, whether asserted by legal proceedings or not under or in connection with a contract or transaction, and includes in particular: (a) a claim for performance of any obligation arising under or in connection with a contract or transaction; (b) a claim for extension or payment of a bond, financial guarantee or indemnity of whatever form; (c) a claim for compensation in respect of a contract or transaction; (d) a counterclaim; (e) a claim for the recognition or enforcement, including by the procedure of exequatur, of a judgment, an arbitration award or an equivalent decision, wherever made or given;

(4) ‘competent authorities’ refers to the competent authorities as identified on the websites listed in Annex I;

(5) ‘contract or transaction’ means any transaction of whatever form and whatever the applicable law, whether comprising one or more contracts or similar obligations made between the same or different parties; for this purpose ‘contract’ includes a bond, guarantee or indemnity, particularly a financial guarantee or financial indemnity, and credit, whether legally independent or not, as well as any related provision arising under, or in connection with, the transaction;

(6) ‘credit institution’ means a credit institution as defined in point (1) of Article 4(1) of Regulation (EU) No 575/2013 of the European Parliament and of the Council (¹), including branches thereof, as defined in point (17) of Article 4(1) of that Regulation, located in the Union, whether its head office is situated within the Union or in a third country;

(7) ‘diplomatic missions, consular posts and their members’ has the same meaning as in the 1961 Vienna Convention on Diplomatic Relations and the 1963 Vienna Convention on Consular Relations, and also includes missions of the DPRK to international organisations hosted in the Member States and DPRK members of those missions;

(8) ‘economic resources’ means assets of every kind, whether tangible or intangible, movable or immovable, actual or potential, which are not funds but can be used to obtain funds, goods or services, including vessels, such as maritime vessels;

(9) ‘financial institution’ means (a) an undertaking, other than a credit institution, which carries out one or more of the activities listed in points (2) to (12), (14) and (15) of Annex I to Directive 2013/36/EU of the European Parliament and of the Council (²), including the activities of currency exchange offices (bureaux de change); (b) an insurance undertaking as defined in point (1) of Article 13 of Directive 2009/138/EC of the European Parliament and of the Council (³), insofar as it carries out life assurance activities covered by that Directive; (c) an investment firm as defined in point (1) of Article 4(1) of Directive 2004/39/EC of the European Parliament and of the Council (⁴); (d) a collective investment undertaking marketing its units or shares; (e) an insurance intermediary as defined in point (5) of Article 2 of Directive 2002/92/EC of the European Parliament and of the Council (⁵) where it acts with respect to life insurance and other investment-related services, with the exception of a tied insurance intermediary as defined in point (7) of that Article; (f) branches, when located in the Union, of financial institutions as referred to in points (a) to (e), whether their head office is situated in a Member State or in a third country;

(10) ‘freezing of economic resources’ means preventing the use of economic resources to obtain funds, goods or services in any way, including, but not limited to, by selling, hiring or mortgaging them;

(11) ‘freezing of funds’ means preventing any moving, transfer, alteration, use of, access to, or dealing with funds in any way that would result in any change in their volume, amount, location, ownership, possession, character, destination or other change that would enable the use of the funds, including portfolio management;

(12) ‘funds’ means financial assets and benefits of every kind, including but not limited to: (a) cash, cheques, claims on money, drafts, money orders and other payment instruments; (b) deposits with financial institutions or other entities, balances on accounts, debts and debt obligations; (c) publicly and privately-traded securities and debt instruments, including stocks and shares, certificates representing securities, bonds, notes, warrants, debentures and derivatives contracts; (d) interest, dividends or other income on or value accruing from or generated by assets; (e) credit, right of set-off, guarantees, performance bonds or other financial commitments; (f) letters of credit, bills of lading, bills of sale; (g) documents evidencing an interest in funds or financial resources;

(13) ‘insurance’ means an undertaking or commitment whereby one or more natural or legal persons are obliged, in return for a payment, to provide one or more other persons, in the event of the materialisation of a risk, with an indemnity or a benefit as determined by the undertaking or commitment;

(14) ‘investment services’ means the following services and activities: (a) reception and transmission of orders in relation to one or more financial instruments; (b) execution of orders on behalf of clients; (c) dealing on own account; (d) portfolio management; (e) investment advice; (f) underwriting of financial instruments and/or placing of financial instruments on a firm-commitment basis; (g) placing of financial instruments without a firm-commitment basis; (h) any service in relation to the admission to trading on a regulated market or trading on a multilateral trading facility;

(15) ‘payee’ means a natural or legal person who is the intended recipient of the transfer of funds;

(16) ‘payer’ means a person who holds a payment account and allows a transfer of funds from that payment account, or, where there is no payment account, that gives a transfer-of-funds order;

(17) ‘payment service provider’ means the categories of payment service provider referred to in Article 1(1) of Directive 2007/64/EC of the European Parliament and of the Council (⁶), natural or legal persons benefiting from a waiver pursuant to Article 26 of Directive 2007/64/EC and legal persons benefiting from a waiver pursuant to Article 9 of Directive 2009/110/EC of the European Parliament and of the Council (⁷), providing transfer-of-funds services;

(18) ‘reinsurance’ means the activity consisting in accepting risks ceded by an insurance undertaking or by another reinsurance undertaking or, in the case of the association of underwriters known as Lloyd's, the activity consisting in accepting risks, ceded by any member of Lloyd's, by an insurance or reinsurance undertaking other than the association of underwriters known as Lloyd's;

(19) ‘services incidental to’ means services rendered on a fee or contract basis by units mainly engaged in the production of transportable goods, as well as services typically related to the production of such goods;

(20) ‘shipowner’ means the registered owner of a seagoing ship, or any other person such as the bareboat charterer who is responsible for the operation of the ship;

(21) ‘technical assistance’ means any technical support related to repairs, development, manufacture, assembly, testing, maintenance, or any other technical service, and may take forms such as instruction, advice, training, transmission of working knowledge or skills or consulting services; including verbal forms of assistance;

(22) ‘territory of the Union’ means the territories of the Member States to which the Treaty is applicable, under the conditions laid down in the Treaty, including their airspace;

(23) ‘transfer of funds’ means: (a) any transaction at least partially carried out by electronic means on behalf of a payer through a payment service provider, with a view to making funds available to a payee through a payment service provider, irrespective of whether the payer and the payee are the same person and irrespective of whether the payment service provider of the payer and that of the payee are one and the same, including: (i) a credit transfer as defined in point (1) of Article 2 of Regulation (EU) No 260/2012 of the European Parliament and of the Council (⁸); (ii) a direct debit as defined in point (2) of Article 2 of Regulation (EU) No 260/2012; (iii) a money remittance as defined in point (13) of Article 4 of Directive 2007/64/EC, whether national or cross border; (iv) a transfer carried out using a payment card, an electronic money instrument, or a mobile phone, or any other digital or IT prepaid or postpaid device with similar characteristics; and (b) any transaction by non-electronic means, such as in cash, cheques or accountancy orders, with a view to making funds available to a payee irrespective of whether the payer and the payee are the same person.

(24) ‘a vessel crewed by the DPRK’ means: (a) a vessel whose manning is controlled by: (i) a natural person of DPRK nationality; or (ii) a legal person, entity or body incorporated or constituted under the law of the DPRK; (b) a vessel entirely manned by DPRK nationals.

CHAPTER II

Export and import restrictions

Article 3

It shall be prohibited:

(a) to sell, supply, transfer or export, directly or indirectly, the goods and technology, including software, listed in Annex II, whether or not originating in the Union, to any natural or legal person, entity or body in, or for use in the DPRK;

(b) to sell, supply, transfer or export aviation fuel, directly or indirectly, as listed in Annex III to the DPRK or transport to DPRK aviation fuel on board the flag vessels or aircraft of Member States, whether or not originating in the territories of Member States;

(c) to import, purchase or transfer, directly or indirectly, the goods and technology listed in Annex II from the DPRK, whether or not originating in the DPRK;

(d) to import, purchase or transfer, directly or indirectly, gold, titanium ore, vanadium ore and rare-earth minerals, as listed in Annex IV, from the DPRK, whether or not originating in the DPRK;

(e) to import, purchase or transfer, directly or indirectly, coal, iron and iron ore, as listed in Annex V, from the DPRK, whether or not originating in the DPRK;

(f) to import, purchase or transfer, directly or indirectly, from DPRK petroleum products, as listed in Annex VI, whether or not originating in the DPRK; and

(g) to import, purchase or transfer, directly or indirectly, copper, nickel, silver and zinc, as listed in Annex VII, from the DPRK, whether or not originating in the DPRK;

Part II of Annex II shall include other items, materials, equipment, goods and technology which could contribute to the DPRK's nuclear-related, ballistic-missile-related or other weapons of mass destruction-related programmes.

Part III of Annex II shall include certain key components for the ballistic-missile sector.

Part IV of Annex II shall include weapons of mass destruction-related items, materials, equipment, goods and technology designated, pursuant to paragraph 25 of UNSCR 2270 (2016).

Part V of Annex II shall include weapons of mass destruction-related items, materials, equipment, goods and technology designated, pursuant to paragraph 4 of UNSCR 2321 (2016).

Part VI of Annex II shall include weapons of mass destruction-related items, materials, equipment, goods and technology designated pursuant to paragraph 4 of UNSCR 2371 (2017).

Part VII of Annex II shall include conventional arms-related items, materials, equipment, goods and technology designated, pursuant to paragraph 5 of UNSCR 2371 (2017).

Part VIII of Annex II shall include weapons of mass destruction-related items, materials, equipment, goods and technology designated, pursuant to paragraph 4 of UNSCR 2375 (2017).

Part IX of Annex II shall include conventional arms-related items, materials, equipment, goods and technology designated, pursuant to paragraph 5 of UNSCR 2375 (2017).

Annex III shall include the aviation fuel referred to in point (b) of paragraph 1.

Annex IV shall include the gold, titanium ore, vanadium ore and rare-earth minerals, referred to in point (d) of paragraph 1.

Annex V shall include the coal, iron and iron ore, referred to in point (e) of paragraph 1.

Annex VI shall include the petroleum products referred to in point (f) of paragraph 1.

Annex VII shall include the copper, nickel, silver and zinc, referred to in point (g) of paragraph 1.

Article 4

Article 5

It shall be prohibited to sell, supply, transfer or export, directly or indirectly, to the DPRK any item, except food or medicine, if the exporter knows or has reasonable grounds to believe that:

(a) the item is destined directly or indirectly for the DPRK's armed forces; or

(b) the export of the item could support or enhance the operational capabilities of the armed forces of a State other than the DPRK.

Article 6

By way of derogation from Article 5, the competent authorities of the Member States may authorise the sale, supply, transfer or export of an item to the DPRK, or the import, purchase or transport of an item from the DPRK, where:

(a) the item does not relate to the production, development, maintenance or use of military goods, or development or the maintenance of military personnel, and the competent authority has determined that the item would not directly contribute to the development of the operational capabilities of the DPRK's armed forces or to exports that support or enhance the operational capabilities of armed forces of a third country other than the DPRK;

(b) the Sanctions Committee has determined that a particular supply, sale or transfer would not be contrary to the objectives of UNSCR 1718 (2006), 1874 (2009), 2087 (2013), 2094 (2013), 2270 (2016) or 2321 (2016); or

(c) the competent authority of the Member State is satisfied that the activity is exclusively for either humanitarian or livelihood purposes which will not be used by DPRK persons, entities or bodies to generate revenue, and is not related to any activity prohibited by UNSCR 1718 (2006), 1874 (2009), 2087 (2013), 2094 (2013), 2270 (2016) or 2321 (2016), provided that the Member State notifies the Sanctions Committee in advance of such a determination and informs the Sanctions Committee of measures taken to prevent the diversion of the item for any prohibited purpose.

Article 7

It shall be prohibited:

(a) to provide, directly or indirectly, technical assistance and brokering services related to goods and technology listed in the EU Common List of Military Equipment or in Annex II, and related to the provision, manufacture, maintenance and use of goods listed in the EU Common List of Military Equipment or in Annex II, to any natural or legal person, entity or body in, or for use in the DPRK;

(b) to provide, directly or indirectly, financing or financial assistance related to goods and technology listed in the EU Common List of Military Equipment or in Annex II, including in particular grants, loans and export credit insurance, as well as insurance and reinsurance, for any sale, supply, transfer or export of such items, or for any provision of related technical assistance to any natural or legal person, entity or body in, or for use in the DPRK;

(c) to obtain, directly or indirectly, technical assistance related to goods and technology listed in the EU Common List of Military Equipment or in Annex II, and to the provision, manufacture, maintenance and use of goods listed in the EU Common List of Military Equipment or in Annex II from any natural or legal person, entity or body in, or for use in the DPRK;

(d) to obtain, directly or indirectly, financing or financial assistance related to goods and technology listed in the EU Common List of Military Equipment or in Annex II, including in particular grants, loans and export credit insurance, for any sale, supply, transfer or export of such items, or for any provision of related technical assistance from any natural or legal person, entity or body in, or for use in, the DPRK.

Article 8

Article 9

Article 10

It shall be prohibited:

(a) to sell, supply, transfer or export, directly or indirectly, luxury goods as listed in Annex VIII, to the DPRK;

(b) to import, purchase or transfer from the DPRK, directly or indirectly, luxury goods, as listed in Annex VIII, whether or not originating in the DPRK.

Article 11

It shall be prohibited:

(a) to sell, supply, transfer or export, directly or indirectly, gold, precious metals and diamonds as listed in Annex IX, whether or not originating in the Union, to or for the Government of the DPRK, its public bodies, corporations and agencies, the Central Bank of the DPRK and any person, entity or body acting on their behalf or at their direction, or any entity or body owned or controlled by them;

(b) to import, purchase or transport, directly or indirectly, gold, precious metals and diamonds, as listed in Annex IX, whether or not originating in the DPRK, from the Government of the DPRK, its public bodies, corporations and agencies, the Central Bank of the DPRK and any person, entity or body acting on their behalf or at their direction, or any entity or body owned or controlled by them;

(c) to provide, directly or indirectly, technical assistance or brokering services, financing or financial assistance, related to the goods referred to in points (a) and (b), to the Government of the DPRK, its public bodies, corporations and agencies, the Central Bank of the DPRK and any person, entity or body acting on their behalf or at their direction, or any entity or body owned or controlled by them.

Article 12

It shall be prohibited to sell, supply, transfer or export, directly or indirectly, newly printed or unissued DPRK denominated banknotes and minted coinage, to or for the benefit of the Central Bank of DPRK.

Article 13