Status of International Nonproliferation and Counterterrorism Efforts in the South Caucasus by The Fund for Peace

Status of International Nonproliferation and Counterterrorism Efforts in the South Caucasus

Threat Convergence Fact Sheet Series

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Contents

WMD Non-Proliferation Initiatives

Export Control Laws and Projects in Place

Counterterrorism Initiatives

International Anti-Terrorism Instruments

Anti-Money Laundering and Countering Terrorism Finance Initiatives

U.S. Multilateral Initiatives

Key Resources and Endnotes

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WMD Nonproliferation Activities

Nuclear Nonproliferation Treaty

Comprehensive Test Ban Treaty (not yet entered into force)

Chemical Weapons Convention (1993)

Biological Toxin Weapons Convention (1972)

International Atomic Energy Agency

Convention on the Physical Protection of Nuclear Material (1980)

Joint Convention on the Safety of Spent Fuel Management and on the safety of Radioactive Waste Management (1997)

Convention on Nuclear Safety (1994)

International Convention for the Suppression of Acts of Nuclear Terrorism (2005)

9 Nov 2004 Add. 1

CSA/AP

S Azerbaijan

28 Oct 2004 Add. 1

CSA/AP

SP Georgia

24 Oct 2004

CSA/AP

Romania

27 Oct 2004 Add. 1

CSA/AP

Turkey

1 Nov 2004 Add. 1 1 Feb 2008

CSA/AP

UNSCR 1540 Reports submitted1

Armenia

Abbreviations

Additional Protocol in Force

Signatory

CSA

Comprehensive Safeguards Agreement in force

State Party

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Export Control Laws and Projects in Place

Armenia

The Armenian Parliament adopted a law on the export control of dual-use items and technologies and their transit across the territory of the Armenia on 24 September 2003. An inter-departmental Commission for the export control of dual-use items and technologies enforces export controls and regulates the transit of dual-use items across the territory of Armenia. Any support to non-state actors involved in WMD proliferation is prohibited under Armenian law. Armenia adopted a dual-use control list in 2007 and has since harmonized the Armenian list with the EU dual-use control list. The Criminal Code of Armenia, adopted in 2003, criminalizes actions prohibited by WMD nonproliferation treaties, including the development, production, acquisition, transfer, smuggling and sale of weapons of mass destruction or relevant components, technologies and devices. Additionally, the Criminal Code prohibits the smuggling of weapons, narcotics, radioactive and explosive materials.

Azerbaijan

Azerbaijan’s export control law came into force on 26 October 2004. The law stipulates that conventional, nuclear, chemical and biological weapons, materials, devices, technologies and any services thereto pertaining, as well as dual-use goods are subject to export control. It remains unclear whether the government of Azerbaijan has compiled a comprehensive list of controlled items. For more information, please see the Azerbaijani Law on Export Control (in Russian).1 Azerbaijan has received extensive technical assistance from the United States to develop a robust export control system. In 2007, the U.S. funded training of Azeri border guards and customs officials on dualuse commodity identification, international export control, border security and interdiction techniques. The U.S. government also assisted Azeri authorities in the implementation of the export control law by funding training, software development for tighter control and regulation implementation. In January 2005, a DOE/NNSA team traveled to Baku to conduct a workshop on nuclear commodity identification, commodities subject to export control, and Azeri legislation in the field of export control. In February 2004, U.S. government agencies sponsored workshops on transit controls for freight forwarders, maritime nuclear commodity identification, and export control legislation standards. Despite progress made, the U.S. Department of State notes that Azeri export control legislation “still lacks comprehensive controls on transit and transshipments”, and export licensing for dual-use items has yet to be fully implemented. Additionally, law enforcement officials and freight forwarders receive inadequate training in the sphere of trade controls. Corruption and insufficient resources increase vulnerability, and sensitive cargo often goes unchecked. The Azeri government has not made sufficient progress in investigating and prosecuting those found to be in violation of export controls. For more information, please see the State Department’s Country Assessments and Performance Measures for Azerbaijan, 2006.2

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Export Control Laws and Projects in Place

Georgia

Georgia’s Law on the Export Control of Weapons, Military Equipment and Dual-Use Items was adopted on 28 April 1998. The law stipulated that conventional, nuclear, chemical and biological weapons, materials, devices and technologies are subject to export controls, and that an export license can only be obtained for the export of nuclear material if the recipient country provides guarantees that the materials will be used exclusively for peaceful purposes and will be subject to all IAEA safeguards. By 2002, the Georgian government had compiled a list of 26 groups of dual-use items subject to export control. This list includes controlled items from the Nuclear Suppliers Group (NSG) control lists. In January 2003, the Export Control law was amended to specify the licensing authorities for weapons and dual-use goods. The United States has provided technical and training assistance to Georgia in the development of an export control system. In April 2005, the DOE organized a series of export control workshops in Tbilisi and along the Georgian-Azerbaijani border. In September 2004, a NNSA team conducted a series of training courses on nuclear commodity identification for Georgian customs and border patrol officials. In April 2004, DOE specialists held an end-use/end-user workshop in Tbilisi for Georgian government officials, which covered export control standards, export license reviews, and proliferation methods. For more information, please see the NTI page on Export Control Developments in Georgia.3

Romania

Romania’s initial export control law4 was enacted in 1992 under Government Decision no. 594. This law established a national export control authority (ANCEX), licensing and authorization procedures, and control lists identifying sensitive and dual use technologies. This law was enhanced to comply with EU safeguards in 2003. Romania responds to requests from states within the region seeking assistance to fulfill the legal and regulatory requirements of UNSCR 1540. As a result, Romania provides technical assistance to its neighbors and has formed the “Border Defense Initiative,” a regional project that seeks to prevent the spread of dangerous biological, chemical, nuclear, and radiological materials. Furthermore, Romania has contributed to the IAEA’s Nuclear Security Fund since 2002.

Turkey

Located between the Caucasus, the Middle East, and Europe, Turkey is a major player in the effort to prevent WMD trafficking. After the collapse of the Soviet Union, Turkey experienced several incidents involving the trafficking of nuclear or radioactive materials. However, Turkey is a member of all international export control regimes and is working to improve its safeguards. Turkey employs a twotiered export control system5 for sensitive and dual use goods which requires licensing from relevant agencies and registration with the Undersecretariat for Foreign Trade (UFT). Furthermore, exports that are not declared sensitive or dual use are required to register with the UFT if their potential end-use raises suspicions. In January 2007, the UFT began requiring end-use certificates to ensure that dual-use exports don’t wind up in the wrong hands. Finally, several articles in “The new Turkish Criminal Code No:5237” illegalize the transfer or use of nuclear weapons and materials, including Article 174 which covers “Possessing and Exchanging Dangerous Materials without Permission.” Given its critical role in the prevention of WMD proliferation, the United States has taken on a substantial role in helping to improve Turkey’s safeguards. Between 2003 and 2006, Turkey received $3 million in export control assistance from the United States, the largest total given to any nation by the United States. Turkey is a participant in the Proliferation Security Initiative and has received training to enhance the capacity of customs agents to interdict nuclear trafficking.

Endnotes 1. 2. 3. 4. 5.

http://disarmament2.un.org/committee1540/Datasheets/Azerbaijan%20Law%20on%20Export%20Control.doc http://www.state.gov/p/eur/rls/rpt/92785.htm http://www.nti.org/e_research/profiles/Georgia/export_control.html http://www.nti.org/db/1540/pdfs/1540_romania_20041027.pdf http://www.nti.org/db/1540/pdfs/1540_turkey_20041101.pdf

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Counterterrorism Initiatives (UNSCR 1373 & 1624)*

Pursuant to U.N. Security Council Resolutions 1373 (http://www.un.org/sc/ctc/countryreports/Creports.shtml) and 1624 (http://www.un.org/sc/ctc/1624.html).

CTC Cooperation

UNSCR 1373 Reports submitted

UNSCR 1624 Reports submitted

UNODC Terrorism Prevention Branch activities

CTC assistance received 2001-2007

1) S/2002/162 2) S/2003/146 3) S/2003/1044 4) S/2005/366 5) S/2006/1028

S/2006/1028

• Participated in a workshop on the Implementation of the Universal Instruments against Terrorism. Organized in cooperation with the CIS Executive Committee and co -funded by the OSCE (Minsk, Belarus, January 2008). • Participated in a workshop for legal experts of CSTO Member States on the criminal law aspects of the implementation of the Universal counter-terrorism Instruments, (Moscow, Russia, October 2007). • Participated in the second subregional expert workshop on International Cooperation on Counter- Terrorism, Corruption and the Fight against Transnational Organized Crime (Antalya, Turkey, February 2007). • Participated in a workshop on the legislative implementation of universal instruments against terrorism and regional experiences in promoting international cooperation against terrorism for the members of the Commonwealth of Independent States (Moscow, Russia, November 2005) • Participated in a workshop for Central Asia and the Caucasus on international cooperation against terrorism and transnational organized crime, organized in cooperation with the Government of Turkey (Antalya, Turkey, February 2004)

CTC assistance received 1998-2006

1) S/2001/1325 2) S/2002/1022 3) S/2003/1085 4) S/2004/964 5) S/2006/802

S/2006/802

• Participated in a workshop on the Implementation of the Universal Instruments against Terrorism. Organized in cooperation with the CIS Executive Committee and co -funded by the OSCE (Minsk, Belarus, January 2008). • Participated in the second subregional expert workshop on International Cooperation on Counter- Terrorism, Corruption and the Fight against Transnational Organized Crime (Antalya, Turkey, February 2007). • Participated in a workshop on the legislative implementation of universal instruments against terrorism and regional experiences in promoting international cooperation against terrorism for the members of the Commonwealth of Independent States (Moscow, Russia, November 2005)

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Counterterrorism Initiatives (UNSCR 1373 & 1624)

CTC Cooperation

UNSCR 1373 Reports submitted

UNSCR 1624 Reports submitted

UNODC Terrorism Prevention Branch activities

CTC assistance received 2002-2005

1) S/2002/3 & Add.1 2) S/2002/1185

• Participated in the second subregional expert workshop on International Cooperation on Counter- Terrorism, Corruption and the Fight against Transnational Organized Crime (Antalya, Turkey, February 2007). • Participated in a workshop on the legislative implementation of universal instruments against terrorism and regional experiences in promoting international cooperation against terrorism for the members of the Commonwealth of Independent States (Moscow, Russia, November 2005) • Participated in a workshop for Central Asia and the Caucasus on international cooperation against terrorism and transnational organized crime, organized in cooperation with the Government of Turkey (Antalya, Turkey, February 2004)

CTC assistance received 2003-2008

1) S/2001/1339 2) S/2002/949 3) S/2003/1015 4) S/2005/62 5) S/2006/254

S/2006/254

• Participated in the Subregional workshop for Central and South-Eastern Europe on Cooperation Against Terrorism and Organized Crime (Budapest, Hungary, November 2008) • Participated in the Euro-Mediterranean Workshop on the Mechanisms of International Cooperation in Criminal Matters Pertaining to Counter-terrorism (Rabat, Morocco, May 2008) • Hosted the Second Subregional Expert Workshop on International Cooperation on Counter-terrorism, Corruption and the Fight Against Transnational Organized Crime, (Bucharest, Romania, November 2006) • Participated in the Expert Workshop on International Cooperation on Counter-terrorism, Corruption and the Fight Against Transnational Crime, (Zagreb, Croatia, March 2005)

CTC assistance received 2003-2008

1) S/2001/1304 2) S/2002/948 3) S/2003/856 4) S/2004/832 5) S/2006/147

See: S/2006/147

• Provides technical counter-terrorism assistance to countries on request (date of last assistance: Nov. 14, 2009) • Provides monetary support for counter-terrorism assistance • Participated in the Euro-Mediterranean Workshop on the Mechanisms of International Cooperation in Criminal Matters Pertaining to Counter-terrorism (Rabat, Morocco, May 2008) • Hosted the second subregional expert workshop on International Cooperation on Counter- Terrorism, Corruption and the Fight against Transnational Organized Crime (Antalya, Turkey, February 2007). • Hosted the first workshop for Central Asia and the Caucasus on International Cooperation against Terrorism and Transnational Organized Crime (Antalya, Turkey, February 2004)

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International Antiterrorism Instrumentsa

Convention on Offences and Certain Other Acts Committed On Board Aircraft (1963)

Convention for the Suppression of Unlawful Seizure of Aircraft (1970)

Convention for the Suppression of Unlawful Acts Against the Safety of Civil Aviation (1971)

Convention on the Prevention and Punishment of Crimes against Internationally Protected Persons, including Diplomatic Agents (1973)

International Convention Against the Taking of Hostages (1979)

Convention on the Physical Protection of Nuclear Material (1980)

Protocol for the Suppression of Unlawful Acts of Violence at Airports Serving International Civil Aviation, supplementary to the Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation (1988)

Convention for the Suppression of Unlawful Acts Against the Safety of Maritime Navigation (1988)

Protocol for the Suppression of Unlawful Acts Against the Safety of Fixed Platforms Located on the Continental Shelf (1988)

Convention on the Marking of Plastic Explosives for the Purpose of Detection (1991)

International Convention for the Suppression of Terrorist Bombings (1997)

International Convention for the Suppression of Acts of Nuclear Terrorism (2005)

Amendment to the Convention on the Physical Protection of Nuclear Material

Protocol of 2005 to the Convention for the suppression of unlawful acts against the safety of maritime navigation

Protocol of 2005 to the Protocol for the suppression of unlawful acts against the safety of fixed platforms located on the continental shelf

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Anti-Money Laundering and Countering Terrorism Finance Initiatives

International Convention for the Suppression of Terrorist Financing

Implementation of FATF 40+9 recommendations

Armenia

Until 2004, Armenia had no mechanisms for AML/CTF, according to the Central AsiaCaucasus Institute.1 In 2004, Armenia established an AML/CTF framework and opened an FIU in 2005. Armenia was identified by the US Department of the Treasury in the 2007 National Money Laundering Strategy2 as a country with shell companies implicated in SARs filed between 1996 and 2004.3

Azerbaijan

Azerbaijan’s progress in developing an AML/CTF framework was considerably slower than that of Armenia and Georgia, and this framework remained at a level below international standards through 2006. Money laundering was criminalized in 2006, but there were no investigations or prosecutions underway and no FIU, according to the Central Asia-Caucasus Institute.4 In February 2009, Azerbaijan adopted an AML/CTF law and has since made “progress (…) in addressing many of [the] concerns” expressed by MONEYVAL.5

Georgia

Georgia’s anti-money laundering (AML) law came into effect in 2004. Soon thereafter, the Georgian Financial Intelligence Unit (FIU) and specialized units within Georgian law enforcement institutions helped prosecute 26 cases of money laundering. The trials ended in 15 convictions. Many casinos, long suspected of being money laundering fronts, were closed. However, according to the Central Asia-Caucasus Institute,6 ensuring compliance with anti-money laundering/counter-terrorism financing (AML/CTF) standards and legislation remained challenging due to political instability and endemic corruption, and suspicious activity reports (SARs) were rarely filed. Georgia was identified by the US Department of the Treasury in the 2007 National Money Laundering Strategy7 as a country with shell companies implicated in SARs filed between 1996 and 2004.8

Romania

Romania has made significant progress in the AML/CTF field. Romania’s AML/CFT Law (No. 652) was adopted in 2002 and provides a sound legal framework that complies with international standards. This framework was strengthened in 2004 with the adoption of Law no. 535 on Preventing and Fighting Terrorism. The Romanian Financial Intelligence Unit takes on a large role in the implementation of the AML/CFT system, but may be relatively understaffed. The July 2008 third round MONEYVAL evaluation report9 found that Romania was “compliant” or “largely compliant” in 23 of 40 recommendations and 2 of 9 special recommendations.10

Turkey

Turkey has passed a number of laws to improve its AML/CTF framework, but it is not yet apparent whether these will prove effective. A new AML law was introduced in 2005 and a stand-alone terrorist financing charge was introduced in 2006. Turkey’s ability to track cross-border movements of cash has been enhanced. The FATF-GAFI’s February 2007 evaluation report11 found Turkey to be either “partially compliant” or “noncompliant” in 25 of 40 recommendations and 8 of 9 special recommendations.

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U.S. Multilateral Initiatives

Container Security Initiative

Proliferation Security Initiative

Nuclear Smuggling Outreach Initiative

Megaports Initiative (National Nuclear Security Administration)

Armenia

Participant

Joint action plan signed in 2008 (see NSOI Armenia fact sheet1)

Azerbaijan

Participant

Georgia

Participant

Joint action plan signed in 2007 (see NSOI Georgia fact sheet2)

Romania

Participant

Turkey

Participant

Endnotes 1. 2.

http://www.nsoi-state.net/media/pdf/Armenia%20fact%20sheets.pdf http://www.nsoi-state.net/media/pdf/Georgia%20fact%20sheets.pdf

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Key Resources

• • • • • • • • • •

National Reports to the UN Security Council 1540 Committee: http://www.un.org/sc/1540/nationalreports.shtml Container Security Initiative: http://www.cbp.gov/xp/cgov/trade/cargo_security/csi/ FATF 40 Recommendations on Money Laundering: http://www.fatf-gafi.org/ document/28/0,3343,en_32250379_32236930_ 33658140_1_1_1_1,00.html FAFT 9 Recommendations on Terrorist Financing: http://www.fatf-gafi.org/ ___document/9/0,3343,en_32250379_32236920_ 34032073_1_1_1_1,00.html FATF Proliferation Financing Report: http://www.fatf-gafi.org/dataoecd/14/21/41146580.pdf US Megaports Initiative: http://nnsa.energy.gov/nuclear_nonproliferation/1641.htm MONEYVAL: http://wwww.coe.int/moneyval Proliferation Security Initiative: http://www.state.gov/t/isn/c10390.htm UN Security Council Counter-terrorism Committee: http://www.un.org/sc/ctc/ UN Office of Drugs and Crime (UNODC) Terrorism Prevention Branch: http://www.unodc.org/unodc/en/terrorism/ index.html

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About The Fund for Peace

he Fund for Peace is an independent, nonpartisan, 501(c)(3) non-profit research and educational organization that works to prevent violent conflict and promote sustainable security.

Conflict Early Warning and Assessment

Transnational Threats

We have worked in over 50 countries with a wide range of partners in all sectors: governments, international organizations, the military, nongovernmental organizations, academics, journalists, civil society networks, and the private sector.

We promote sustainable security through research, training and education, engagement of civil society, building bridges across diverse sectors, and developing innovative technologies and tools for policy makers. A leader in the conflict assessment and early warning field, the Fund for Peace focuses on the problems of weak and failing states. Our objective is to create practical tools and approaches for conflict mitigation that are useful to decision-makers.

The Fund for Peace offers a wide range of initiatives focused on our central objective of promoting sustainable security, the ability of a state to solve its own problems peacefully without an external military or administrative presence. Our programs fall into three primary thematic areas: Conflict Early Warning and Assessment; Transnational Threats; and Sustainable Development, Sustainable Security.

The Fund for Peace adopts a holistic approach to the issues stemming from weak and failing states. We work at both the grassroots level with civil society actors and at policy levels with key decision makers.

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Sustainable Development, Sustainable Security

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CR-11-07-TC