Joint Proposal for a COUNCIL REGULATION amending Regulation (EC) No 329/2007 concerning restrictive measures against the Democratic People’s Republic of Korea
Date: 2013-03-08
Institutions: European Commission, High Representative of the Union
Subjects: North Korea, economic sanctions, international sanctions, trade restriction

EUROPEAN 
COMMISSION 

HIGH REPRESENTATIVE OF THE
EUROPEAN UNION FOR
FOREIGN AFFAIRS AND
SECURITY POLICY

Brussels, 8.3.2013  
JOIN(2013) 3 final 

2013/0078 (NLE) 

Joint Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 329/2007 concerning restrictive measures against the 
Democratic People’s Republic of Korea 

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(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

EXPLANATORY MEMORANDUM 

Council  Regulation  (EC)  No  329/2007  of  27  March  2007  gives  effect  to  measures 
provided for in Council Decision 2010/800/CFSP of 22 December 2010 concerning 
restrictive  measures  against  the  Democratic  People's  Republic  of  Korea  ("North 
Korea").  

On  18  February  2013,  the  Council  adopted  Decision  2013/88/CFSP  amending 
Decision 2010/800/CFSP concerning restrictive measures against North Korea which 
provides for additional restrictive measures.  

These  additional  measures 
include  an  additional  criterion  for  autonomous 
designation  by  the  Union,  prohibitions  on  supply  of  additional  goods  relevant  to 
North  Korea's  weapons  of  mass  destruction  related  programmes,  prohibitions  in 
relation  to  gold,  precious  metals  and  diamonds,  newly  printed  or  minted  North 
Korean banknotes, and public bonds,  

The measures also include prohibitions on the opening of new branches, subsidiaries, 
or representative offices of North Korean banks in the territories of Member States, 
and the establishment of new joint ventures.  

Moreover,  in  accordance  with  paragraph  13  of  United  Nations  Security  Council 
(UNSC)  Resolution  2087  (2013),  no  claims  in  connection  with  the  performance  of 
any  contract  or  transaction  affected  by  measures  decided  on  pursuant  to  relevant 
UNSC Resolutions or measures of the Union in accordance with relevant decisions 
of the UNSC or covered by the present Regulation, are to be granted to designated 
persons or entities or any other person or entity in North Korea. 

In view of Article 215 TFEU, further action by the Union is needed to give effect to 
these measures. 

The  High  Representative  for  Foreign  Affairs  and  Security  Policy  and  the 
Commission  should  therefore  propose  to  amend  Regulation  (EC)  No  329/2007 
accordingly.  

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2013/0078 (NLE) 

Joint Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 329/2007 concerning restrictive measures against the 
Democratic People’s Republic of Korea 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on European Union, and in particular Article 215 (1), thereof, 

Having  regard  to  the  joint  proposal  from  the  High  Representative  of  the  Union  for  Foreign 
Affairs and Security Policy and the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

Council  Regulation  (EC)  No  329/20071  gives  effect  to  measures  provided  for  in 
Decision 2010/800/CFSP.  

On  18  February  2013,  the  Council  adopted  Decision  2013/88/CFSP  amending 
Decision  2010/800/CFSP  concerning  restrictive  measures  against  the  Democratic 
People's Republic of Korea2 which provides for additional restrictive measures against 
the Democratic People's Republic of Korea (hereinafter referred to as ‘North Korea’). 
Decision  2013/88/CFSP  gives  effect  to  additional  measures  required  by  United 
Nations  Security  Council  (UNSC)  Resolution  2087  (2013)  and  further  autonomous 
measures of the Union.  

The additional measures include an additional criterion for autonomous designation by 
the  Union  of  persons  and  entities  subject  to  restrictive  measures,  namely  persons 
involved  in,  including  through  the  provision  of  financial  services,  the  supply  to  or 
from  North  Korea  of  arms  and  related  material  of  all  types,  or  of  items,  materials, 
equipment,  goods  and  technology  which  could  contribute  to  North  Korea's  nuclear-
related,  ballistic  missile-related  or  other  weapons  of  mass  destruction  related 
programmes. 

Furthermore, the measures prohibit the sale, supply, transfer to North Korea of certain 
other  goods  relevant  to  North  Korea's  weapons  of  mass  destruction-related 
programmes,  in  particular  its  ballistic-missile  sector,  especially  certain  types  of 
aluminium. 

Decision  2013/88/CFSP also  prohibits the sale, purchase, transportation  or brokering 
of gold, precious metals and diamonds to, from or for the Government of North Korea 
and the delivery of newly printed or minted or unissued North Korean banknotes and 
coinage to or for the benefit of the Central Bank of North Korea, as well as the sale or 
purchase  of  North  Korea  public  or  public-guaranteed  bonds.  Furthermore,  Decision 
2013/88/CFSP  clarifies  that  where  the  Council  has  provided  for  a  prohibition  on 

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OJ L 88, 29.3.2007, p1 

OJ L 46, 19.2.2013, p28 

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financial  services,  this  includes  the  provision  of  insurance  and  re-insurance  services. 
This necessitates a technical amendment to the Regulation.  

(6) 

Decision  2013/88/CFSP  prohibits  the  opening  of  new  branches,  subsidiaries,  or 
representative offices of North Korean banks in the territories of Member States, the 
establishment  of  new  joint  ventures,  or  the  taking  of  an  ownership  interest  by  the 
North  Korean  banks,  including  the  Central  Bank  of  North  Korea,  with  banks  within 
the jurisdiction of Member States.  

(7)  Moreover, in line with paragraph 13 of UNSC Resolution 2087 (2013), it is necessary 
to  establish  that  no  claims  in  connection  with  the  performance  of  any  contract  or 
transaction  affected  by  these  measures  shall  be  granted  to  designated  persons  or 
entities or any other person or entity in North Korea. 

(8) 

Regulation (EU) No 329/2007 should therefore be amended accordingly, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Regulation No 329/2007 is amended as follows: 

(1) 

Article 2 is replaced by the following: 

"Article 2 

1. 

It shall be prohibited:  

(a) 

to  sell,  supply,  transfer  or  export,  directly  or  indirectly,  the  goods  and 
technology, including software, listed in Annexes I, Ia and Ib, whether or not 
originating in the Union, to any natural or legal person, entity or body in, or for 
use in North Korea;  

(b) 

to participate, knowingly and intentionally, in activities the object or effect of 
which is to circumvent the prohibition referred to in point (a). 

2. 

Annex  I  shall  include  all  items,  materials,  equipment,  goods  and  technology, 
including software, which are dual-use items or technology as defined in Regulation 
(EC) No 428/2009.* 

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

Annex Ib shall include certain key components for the ballistic-missile sector, such 
as certain types of aluminum used in ballistic-missile related systems. 

3. 

It shall be prohibited to purchase, import or transport the goods and technology listed 
in Annexes I, Ia and Ib from North Korea, whether the item concerned originates or 
not in North Korea. 

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* OJ L 134, 29.5.2009, p. 1."  

(2) 

In Article 3(1), point (b) is replaced by the following: 

"(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 

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Annexes I, Ia and Ib, including in particular grant, 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, North Korea;” 

(3) 

The following Articles 4a and 4b and are inserted: 

1. 

It shall be prohibited: 

"Article 4a 

(a) 

(b) 

(c) 

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

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

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 North Korea, its public bodies, corporations and 
agencies,  the  Central  Bank  of  North  Korea  and  any  person,  entity  or  body 
acting  on  their  behalf  or  at  their  direction,  or  any  entity  or  body  owned  or 
controlled by them.  

2. 

Annex  VII  shall  include  gold,  precious  metals  and  diamonds  subject  to  the 
prohibitions referred to in paragraph 1. 

Article 4b 

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

(4) 

The following Article 5a is inserted: 

"Article 5a 

1. 

It shall be prohibited for credit and financial institutions falling within the scope of 
Article 16 to do any of the following:  

(a) 

(b) 

to open a new representative office in North Korea or to establish a new branch 
or subsidiary in North Korea;  

to establish a new joint venture with a credit or financial institution domiciled 
in North Korea or with any credit or financial institution referred to in Article 
11a(2).  

2. 

It shall be prohibited:  

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(5) 

"1. 

2. 

(a) 

(b) 

(c) 

to  authorise  the  opening  of  a  representative  office  or  the  establishment  of  a 
branch or subsidiary in the Union of a credit or financial institution domiciled 
in  North  Korea  or  of  any  credit  or  financial  institution  referred  to  in  Article 
11a(2);  

to  conclude  agreements  for,  or  on  behalf  of,  a  credit  or  financial  institution 
domiciled  in  North  Korea  or  for,  or  on  behalf  of,  any  credit  or  financial 
institution  referred  to  in  Article  11a(2)  pertaining  to  the  opening  of  a 
representative  office  or  the  establishment  of  a  branch  or  subsidiary  in  the 
Union;  

to  grant  an  authorisation  for  taking  up  and  pursuing  the  business  of  credit 
institution  or  for  any  other  business  requiring  prior  authorisation,  by  a 
representative  office,  branch  or  subsidiary  of  a  credit  or  financial  institution 
domiciled in North Korea or of any credit or financial institution referred to in 
Article  11a(2),  if  the  representative  office,  branch  or  subsidiary  was  not 
operational before 19 February 2013.  

(d) 

to  acquire  or  to  extend  a  participation,  or  to  acquire  any  other  ownership 
interest, in a credit or financial institution falling within the scope of Article 16 
by any credit or financial institution referred to in Article 11a(2)."  

In Article 6, paragraphs 1 and 2 are replaced by the following:  

All  funds  and  economic  resources  belonging  to,  owned,  held  or  controlled  by  the 
persons,  entities  and  bodies  listed  in  Annex  IV  shall  be  frozen.  Annex  IV  shall 
include  the  persons,  entities  and  bodies  designated  by  the  Sanctions  Committee  or 
the UN Security Council in accordance with paragraph 8(d) of UNSCR 1718 (2006).  

All  funds  and  economic  resources  belonging  to,  owned,  held  or  controlled  by  the 
persons, entities and bodies listed in Annex V shall be frozen. Annex V shall include 
persons,  entities  and  bodies  not  listed  in  Annex  IV,  who,  in  accordance  Article  5 
points (b) and (c) and (d) of Council Decision 2010/800/CFSP**have been identified 
by the Council as:  

(a) 

(b) 

(c) 

as  responsible  for  North  Korean  nuclear-related,  other  weapons  of  mass 
destruction-related  or  ballistic  missile-related  programmes,  as  well  as  persons 
or  bodies  acting  in  their  name  or  on  their  instructions  and  entities  owned  or 
controlled by them; or 

as providing financial services or the transfer to, through or from the territory 
of  the  Union,  or  involving  nationals  of  Member  States  or  entities  organized 
under  their  laws,  or  persons  or  financial  institutions  in  the  territory  of  the 
Union,  of  any  financial  or  other  assets  or  resources  that  could  contribute  to 
North  Korean  nuclear-related,  other  weapons  of  mass  destruction-related  or 
ballistic  missile-  related  programmes,  as  well  as  persons,  or  bodies  acting  in 
their name or on their instructions and entities owned or controlled by them.  

involved in, including through the provision of financial services, the supply to 
or  from  North  Korea  of  arms  and  related  material  of  all  types,  or  of  items, 
materials,  equipment,  goods  and  technology  which  could  contribute  to  North 
Korea's  nuclear-related,  ballistic  missile-related  or  other  weapons  of  mass 
destruction related programmes, to North Korea.  

Annex V shall be reviewed at regular intervals and at least every 12 months. 
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** OJ L 341, 23.12.2010, p. 32."  

(6) 

The following Articles 9a and 9b are inserted: 

1. 

It shall be prohibited: 

"Article 9a 

(a) 

to sell or purchase public or public-guaranteed bonds issued after 19 February 
2013, directly or indirectly, to or from any of the following:  

(1)  North  Korea  or  its  Government,  and  its  public  bodies,  corporations  and 

(2) 

(3) 

(4) 

(5) 

agencies;  

the Central Bank of North Korea; 

a credit or financial institution domiciled in North Korea or any credit or 
financial institution referred to Article 11a paragraph 2 ;  

a natural person or a legal person, entity or body acting on behalf or at 
the direction of a legal person, entity or body referred to in (i) or (ii);  

a legal person, entity or body owned or controlled by a person, entity or 
body referred to in (i), (ii) or (iii);  

(b) 

(c) 

to provide brokering services with regard to public or public-guaranteed bonds 
issued  after  19  February  2013  to  a  person,  entity  or  body  referred  to  in  point 
(a);  

to assist a person, entity or body referred to in point (a) in order to issue public 
or  public-guaranteed  bonds,  by  providing  brokering  services,  advertising  or 
any other service with regard to such bonds.  

Article 9b 

No claims in connection with any contract or transaction the performance of which 
has been affected, directly or indirectly, in whole or in part, by the measures imposed 
under this Regulation, including claims for indemnity or any other claim of this type, 
such as a claim for compensation or a claim under a guarantee, notably a claim for 
extension  or  payment  of  a  bond,  guarantee  or  indemnity,  particularly  a  financial 
guarantee  or  financial  indemnity,  of  whatever  form,  shall  be  satisfied,  if  they  are 
made by:  

(a)  designated persons, entities or bodies listed in Annex IV and V;  

(b) 

(c) 

any  other  North  Korean  person,  entity  or  body,  including  the  Government  of 
North Korean, its public bodies, corporations and agencies;  

any person, entity or body acting through or on behalf of  one of the persons, 
entities or bodies referred to in points (a) and (b).  

The  performance  of  a  contract  or  transaction  shall  be  regarded  as  having  been 
affected  by  the  measures  imposed  under  this  Regulation  where  the  existence  or 
content of the claim results directly or indirectly from those measures.  

In any proceedings for the enforcement of a claim, the onus of proving that satisfying 
the  claim  is  not  prohibited  by  paragraph  1  shall  be  on  the  person  seeking  the 
enforcement of that claim.  

1. 

2. 

3. 

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4. 

(7) 

(8) 

This  Article  is  without  prejudice  to  the  right  of  the  persons,  entities  and  bodies 
referred to in paragraph 1 to judicial review of the legality of the non-performance of 
contractual obligations in accordance with this Regulation." 

The text as set out in Annex I to this Regulation is inserted as Annex Ib. 

In Articles 3(1) and 3a, references to 'Annexes I and Ia' are replaced by references to 
'Annexes I, Ia and Ib '. 

(9) 

The text as set out in Annex II to this Regulation is inserted as Annex VII." 

Article 2 

This Regulation shall enter into force on the date of its publication in the Official Journal of 

the European Union. 

This Regulation is binding in its entirety and directly applicable in all Member States. 

Done at Brussels,  

For the Council 
The President 

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ANNEX I 

"ANNEX Ib 

Goods referred to in the second subparagraph of Article 2  

Certain  key  components  for  the  ballistic-missile  sector,  such  as  certain  types  of  aluminum 
used in ballistic-missile related systems 

7601 

7602  

7603 

7605 

7606 

7609  

7614 

7604 

7608 

Unwrought aluminium 

Aluminium waste and scrap 

Aluminium powders and flakes 

Aluminium wire 

Aluminium plates, sheets and strip, of a thickness exceeding 0,2 mm 

Aluminium tube or pipe fittings (for example, couplings, elbows, sleeves) 

Stranded wire, cables, plaited bands and the like, of aluminium, not electrically 
insulated 

Aluminium bars, rods and profiles 

Aluminium tubes and pipes" 

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ANNEX II 

"ANNEX VII 

List of gold, precious metals and diamonds referred to in Article 4a  
HS Code 

Description 

7102 

7106 

7108 

7109 

7110 

7111 

7112 

Diamonds, whether or not worked, but not mounted or set  

Silver (including silver plated with gold or platinum), unwrought or in semi-
manufactured forms, or in powder form  

Gold  (including  gold  plated  with  platinum),  unwrought  or  in  semi-
manufactured forms, or in powder form 

Base  metals  or  silver,  clad  with  gold,  not  further  worked  than  semi-
manufactured.  

Platinum, unwrought or in semi-manufactured forms, or in powder form  

Base metals, silver or gold, clad with platinum, not further worked than semi-
manufactured. 

Waste and scrap of precious metal or of metal clad with precious metal; other 
waste and scrap containing precious metal or precious-metal compounds, of a 
kind used principally for the recovery of precious metal" 

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