A merican Club Circular No. 03/1 9 1 JANUARY 11, 2019 CIRCULAR NO. 03/19 TO MEMBERS OF THE ASSOCIATION Dear Member: DEMOCRATIC PEOPLE’S REPUBLIC OF KOREA (DPRK) (NORTH KOREA) – ENFORCEMENT OF UN, US AND EU SANCTIONS This Circular follows up on Circulars 01/18 of January 3, 2018 and 11/18 of March 9, 2018 regarding economic sanctions against the Democratic People’s Republic of Korea (DPRK). It reminds Members of the significant risks entailed in evading US sanctions against the DPRK, and the comprehensive international sanctions regime against the DPRK which the United Nations Security Council introduced in 2017. Enforcement of sanctions generally, and against the maritime industry specifically, has intensified since 2017. This document draws attention to some of the measures which governments are taking to enforce sanctions, and warns of the serious consequences of trading with the DPRK and DPRKrelated interests. In addition, it should always be remembered that, in compliance with US sanctions prohibitions, and in accordance with its rules, the American Club does not provide cover for any DPRK vessels or for any trade involving the DPRK. Enforcement Since 2017, the United Nations Security Council has combined with some of its prominent members to step up surveillance of any maritime activity that arouses a suspicion of sanctions evasion. Concomitantly, there are now even more restrictive measures on the DPRK and DPRK-related activities. As a result of the heightened surveillance of shipping activities in the Yellow Sea, East China Sea and Sea of Japan, surveillance agencies will continue to detect and identify ships which engage in trading activities with the DPRK and foreign-flagged vessels and their owners linked to the DPRK that have been sanctioned for a global port entry bans and assets freezes. Surveillance photographs of foreign-flagged vessels and the people connected with them have resulted in their inclusion on the US Department of the Treasury’s OFAC SDN List and listing by the United Nations Security Council 1718 Committee as designated entities and individuals, subject to a UN asset freeze and travel ban. Photographs reveal the extent to which some shipowners involved in both DPRK sanctions evasions and related transnational organised crime syndicates are prepared to go, including attempts to conceal the ship’s identity by covering or overwriting its legitimate IMO number and name while also turning off the AIS transmitter to hide its track from view on AIS system trackers. A merican Club Circular No. 03/ 19 2 Such ships invariably conceal their identity to hide the unlawful transfer of coal and liquid cargoes in STS operations with DPRK vessels and foreign-flagged or stateless vessels that have been designated by the United States and the UN for earlier violations. The UN Panel of Experts on DPRK sanctions has documented these ships’ activities and the people associated with them. The UN reports are publicly accessible, 1 and they have been disclosed to or read by maritime authorities. In some cases, this has resulted in the withdrawal of registration services to ships engaging in such activities, and some of these ships were detained at their next port of call under the auspices of a global port entry ban on such ships. The United States Treasury Department has so far designated individuals and entities along with 28 ships involved in DPRK sanctions evasion. Any shipowner, charterer or manager involved in these activities