“Questions remain unanswered”: Senate Committee report

May 16, 2016 by Michael Danby
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The Senate Foreign Affairs, Defence and Trade Committee has released its report on its inquiry into the ‘Partial Suspension of Sanctions Against Iran’…writes Michael Danby.

Michael Danby

Michael Danby

Together with Deputy Labor Leader Tanya Plibersek and others in the Labor Party, I pushed strongly for this inquiry. I provided two written submissions and gave oral testimony at a public hearing in Sydney.

The committee uncovered much useful information and made some important recommendations. Among other things, it was highly critical of the Government’s approach in lifting various sanctions against Iran and doing so without adequate explanation or consultation.

The committee’s report to the Senate said that it –

“is deeply concerned by certain aspects of the partial suspension of sanctions against Iran. Questions have been raised—and remain unanswered—about the justification for the shift in policy towards Iran, the reasons for sanctions being lifted against some entities and not others, and the mechanisms in place to reimpose sanctions in the event that Iran breaches its international obligations”.

The committee expressed the view “that the Australian Government must proceed with caution in its relations with Iran and, specifically, on the issue of sanctions”.

It also expressed concern “that in emulating the European Union, too great an emphasis has been placed on potential commercial gains rather than addressing the risk that Australian funds could be inadvertently used to support terrorist activities and violations of human rights in Iran”.   And further that, “Business seeking to trade with Iran will need to exercise strict due diligence and extreme caution to ensure that Australian goods, services or funds do not inadvertently contribute to terrorism or the repression of minorities”.

In a key recommendation, the Senate Foreign Affairs References Committee recommended that –

“the Australian Government undertake a review of all sanctions it has removed in relation to Iran to determine whether such removal is compatible with Australia’s interests, values and principles, and not just whether it follows the approach of the European Union. This should include considering the approach that the United States has taken on sanctions with respect to Iran.”

In my oral evidence at the public hearings I announced –

“I predict that if there is a change of government there will be a reorientation of Australian foreign policy, from my understanding, towards the United States’ more sceptical view rather than Europe’s more beneficent view of this relationship with Iran.”

B’nai B’rith, the Jewish Community Council of Victoria, journalist and former Australian diplomat Rebecca Weisser and the Executive Council of Australian Jewry were some of those who made submissions to the inquiry, and Peter Wertheim, Executive Director of ECAJ, Joshua Koonin of B’nai B’rith and Ms Weisser all testified at the public hearings. I would like to thank all those who made submissions and gave evidence to the inquiry.

Background

In the wake of the nuclear deal with Iran – formally known as the Joint Comprehensive Plan of Action (‘JCPOA’) – the United Nations Security Council passed resolution 2231 which endorsed the JCPOA and provided that, on ‘Implementation Day’, a number of Security Council resolutions that had imposed UN sanctions on Iran would be terminated. The termination of those resolutions is however subject to what is known as ‘snapback’ – meaning that the resolutions will be re-imposed if Iran is in significant default, there has been a formal complaint, and the Security Council declines to continue the termination of the resolutions.

Implementation Day was 16 January 2016 – the date that the International Atomic Energy Agency released its report confirming that Iran had met its initial obligations under the JCPOA.

The day after Implementation Day, the Australian Government, without any advance notice or public consultation, suspended most of its substantive autonomous sanctions against Iran, particularly its economic sanctions. The upshot of this is that, subject to a range of exceptions, Australian persons and entities are no longer banned from trading with, or entering into business relationships with, Iran or Iranian individuals or entities. More specific details can be found on the Department of Foreign Affairs and Trade (‘DFAT’) website which notes that, “Australia will continue to enforce sanctions on arms and related material, certain metals, software and nuclear-related equipment, as well as persons and entities related to these areas”.

The Australian Government’s rationale for its removal of such sanctions (as communicated through DFAT) was that it was following the approach of the European Union (‘EU’) under the JCPOA and it didn’t want Australian business to be at a competitive disadvantage given that the countries of Europe would no longer be prevented from doing business with Iran. Australia was not a signatory to the nuclear agreement with Iran and is therefore under no obligation to alter its sanctions on Iran.

The EU is a party to the JCPOA along with China, France, Germany, Russia, the United Kingdom, the United States and Iran.

Under the JCPOA, among other things, the EU and the U.S. were to remove certain sanctions on Iran. However, in contrast to the EU, the JCPOA provided that the U.S. would still retain most of its primary sanctions and thus effectively maintain its trade embargo against Iran.

Arguments and submissions

DFAT argued that the Australian Government’s removal of sanctions on Iran was in line with UN Security Council resolution 2231, which “calls upon” all states “to take such actions as may be appropriate to support the implementation of the JCPOA”.

I argued that such a provision has no binding effect (“calls upon” is more of a request) and that the provision is so general and broad as to enable states to decide for themselves what is “appropriate” and in “support” of the JCPOA. In my supplementary rebuttal of DFAT’s submission, it was noted that resolution 2231 makes it clear that the provisions of the JCPOA are only for implementation by the parties to it, and that such provisions do not set any precedents for states that are not parties. Accordingly, as Australia is not a party to the JCPOA, it should be free to take whatever approach it likes in relation to sanctions on Iran.

It was important to make this point because the Foreign Minister, Julie Bishop, had intimated in a press conference, that Australia was required by the UN to lift the sanctions on Iran that it had. She said – “Australia has also lifted sanctions in accordance with the UN obligations [emphasis added]”.  This is plainly nonsense.

Why, I asked, did Australia decide to follow the EU on Iran sanctions, when as a mature democracy we can make our own considered decisions on these matters. If Australia is seeking international guidance in this regard, then the better role model would be the U.S. The conundrum for Bishop is that the U.S. maintains sanctions on over 225 individuals and entities associated with Iran, whilst the number for Australia is 91.

The U.S. takes into account the whole range of bad behaviour engaged in by Iran and not just its nuclear weapons ambitions. U.S. Treasury expert, Adam Szubin, explained the U.S. approach as follows:

“Upon “Implementation Day,” when phased relief would begin, the United States will lift nuclear- related secondary sanctions targeting third-country parties conducting business with Iran, including in the oil, banking, and shipping sectors. …

As we phase in nuclear-related sanctions relief, we will maintain and enforce significant sanctions that fall outside the scope of this deal, including our primary U.S. trade embargo. Our embargo will continue to prohibit U.S. persons from investing in Iran, importing or exporting to Iran most goods and services, or otherwise dealing with most Iranian persons and companies. Iranian banks will not be able to clear U.S. dollars through New York, hold correspondent account relationships with U.S. financial institutions, or enter into financing arrangements with U.S. banks. Nor will Iran be able to import controlled U.S.-origin technology or goods, from anywhere in the world. In short, Iran will continue to be denied access to the world’s principal financial and commercial market. The JCPOA provides for only minor exceptions to this broad prohibition. …

As we address the most acute threat posed by Iran, its nuclear program, we will be aggressively countering the array of Iran’s other malign activities. The JCPOA in no way limits our ability to do so, and we have made our posture clear to both Iran and to our partners. This means that the United States will maintain and continue to vigorously enforce our powerful sanctions targeting Iran’s backing for terrorist groups such as Hizballah. … We will also continue our campaign against Hizballah’s sponsors in Iran’s Islamic Revolutionary Guard Corps-Quds Force; Iran’s support to the Houthis in Yemen; its backing of Assad’s regime in Syria; and its domestic human rights abuses. We will also maintain the U.S. sanctions against Iran’s missile program and the IRGC writ large.”

In support of a more cautious approach to lifting sanctions on Iran, many submitters referred to Iran’s egregious record in relation to human rights, lack of freedoms, interventions in other countries’ affairs, support for terrorism and threat to global peace and security.

An excellent summation was given by Mr Peter Wertheim in his oral testimony on behalf of the Executive Council of Australian Jewry. He said –

“The present [Australian] government has argued that things have changed fundamentally since Australia’s autonomous sanctions against Iran were introduced. Iran has installed a new president and has entered into the JCPOA concerning the future of its contentious nuclear program, and this has been endorsed by resolution 2231. However, there has been no change to Iran’s supreme leader, no change to the regime’s guiding theocratic ideology and form of government, and no change to its money laundering and terrorism financing activities and its arming and training of the military wings of Hezbollah and Hamas, which are designated as terrorist organisations by Australia.

There has also been no change to Iran’s illegal deployment of the Islamic Revolutionary Guard Corps outside Iran’s borders in Syria and Lebanon, and no change in its bellicosity and aggression towards the neighbouring Sunni Arab gulf states. Above all, there has been no change to the Iranian regime’s genocidal posture towards and threats against Israel, and no change to Iran’s shameful fostering of Holocaust denial and other forms of anti-Semitism, which the major political parties in Australia decried at the start of the sanctions process in 2008. Nor has there been any change to Iran’s appalling human rights record. Iran continues to carry out public executions at the rate of two to three people per day. More than half of these executions go unannounced by the regime. Minors continue to be included among those who are executed.   The executions are often carried out in a conspicuously barbaric fashion that prolongs the death agony of the person being executed. Iran continues to persecute, harass, intimidate and arbitrarily arrest, torture and imprison – often for sentences of indeterminate length – political activists, members of ethnic and religious minorities, trade unionists, gays and artists.”

It is a great shame that the Government took the approach it did. It seems to be a case of undue haste and the pursuit of economic interests, coupled with the desire to repatriate asylum seekers from Iran, being considered more important than our values and principles and the threat to global peace and security posed by the Iranian regime.

The Hon Michael Danby is Labor Federal Member for Melbourne Ports and Shadow Parliamentary Secretary to the Leader of the Opposition

Comments

2 Responses to ““Questions remain unanswered”: Senate Committee report”
  1. Eleonora Mostert says:

    You forgot to mention the testing of missiles… oops, I could have sworn they broke the agreement at least three times from what I understand.

    • Russell Goldberg says:

      For a link to all documents related to the inquiry, including submissions, transcript of the public hearings and the final report, see –
      http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Foreign_Affairs_Defence_and_Trade/Iran

      If you read some of these, you will see that the issue of Iran’s ballistic missile activity was extensively raised. Some examples are mentioned below.

      In the final report covering the committee’s view and recommendations, the committee noted –

      “… Iran is a theocratic and totalitarian regime with a dismal record of human rights and international engagement. Its recent testing of ballistic missiles is of considerable concern. …” (paragraph 4.2)

      “During the inquiry, deep concern was expressed over Iran’s domestic and international behaviour. … The committee also notes Iran’s continued aggression towards its neighbours, most notably Israel, and the conduct of ballistic missile tests which threaten the stability of the region. …” (paragraph 4.6)

      Michael Danby’s initial submission summed up the whole range of Iran’s bad behaviour and noted in part as follows –

      “Iran is a major sponsor of terrorism (including through its proxy Hezbollah); is a destabilising influence in the Middle East (particularly in relation to Syria, Yemen, Saudi Arabia, Bahrain, Lebanon, Iraq and the Palestinian territories); … continues to engage in ballistic missile launches and development and asserts its right to do so ; has a history of deceiving and not cooperating with the International Atomic Energy Agency and the international community in relation to its nuclear program; promotes Holocaust denial; threatens to wipe out another UN member state (Israel); continues to make belligerent comments against the U.S., such as “death to America”; recently had arms shipments originating from it seized by both the Australian and U.S navies ; is allegedly involved in cyberattacks against U.S. financial institutions and infrastructure ; continues to engage in hostile and threatening behaviour ; and is intent on substantially expanding its military capability (such as plans to purchase around $8 billion worth of jets, anti-aircraft missile systems and other military hardware from Russia , and recent statements by the Iranian Defense Minister that Iran intends “to increase the precision-striking power of its weapons systems”, is “boosting the destructive and penetration power of different weapons’ warheads” and that “We should strengthen ourselves to the level that we can prevent failure and acquire victory over our enemies” ). (paragraph 2.1)

      He posed the question at the end of his submission –

      “Will the Australian Government reconsider the suspension of some or all of its sanctions against Iran, or impose other sanctions against Iran, in view of Iran’s continued activity in relation to ballistic missile development and ballistic missile tests? The U.S. has imposed further sanctions on Iran as a result of this ballistic missile activity . Such activity is possibly in contravention of UN Security Council Resolution 2231 (2015) or contrary to the spirit of that resolution.” (paragraph 8.1)

      In his supplementary submission he commented –

      “… Whilst it is too early to assess how Iran will proceed under the JCPOA, Iran has already shown its defiance by engaging in ballistic missile tests. U.S. President Barack Obama has recently criticised Iran for undermining the spirit of the nuclear agreement, including through Iran’s continued support of Hezbollah, its launching of ballistic missiles and other provocative behaviour. And there are more recent reports that Iran has test launched the Simorgh space launch vehicle, the technology for which may enable the development of intercontinental ballistic missiles with the capability of delivering nuclear weapons.” (paragraph 6)

      In his oral testimony he said –

      “I point to the Australian government’s failure during this process since the signing of JCPOA to now, including the lifting of sanctions, to make comments on the shooting in October-December last year and March of this year of the ballistic missiles that caused such fear within the region. Last Tuesday, 18 April, Iran launched Simorgh ICBM, which the United States identified as having nuclear-carrying capabilities just last Tuesday, 18 April. In my view the committee should support the concerns of our most important security ally, the United States, about these missile tests. I would regard it as appropriate that the Australian government make statements to that effect, as we would have done prior to the nuclear treaty being signed at each of these kinds of incidents.” (p.12)

      There are many other references to ballistic missiles, but the above should give a sense of the importance given to this issue.

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