SE-37 TRADE CONTROLS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79S01011A000900010010-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 6
• Document Creation Date: December 9, 2016
• Document Release Date: February 28, 2000
• Sequence Number: 10
• Content Type: OUTLINE

 Approved For Release 2000/08/29 : CIA-RDP79S0101lA000900010010-9
The US-UK munitions list is used as "Referenoe" by COCOM
members to guide the enforcement of their own parallel embargoes. Warships.
tankers, float docks and ice breakers over 2 000 horsepower
Merchant vesselsg (ec-aept tankers), dredges, and foe breakerrunder 2, L I?
horsepower are on I/L II. All COC014 members now embargo for Communist China
all items on the International Munitions Lists, the US Atomic Ewa Commission
List, and on I/L is II, and III. All COCOM members apply a selective embargo
for Communist China to items on US lists other than US I (identical with
IA I), short supply items on the US Positive List,` U5 Non-Positive List items,
and items on the UK Supplementary List. Of 36 broad categories on the UK
Supplementary List, COGOM countries have accepted for embargo to China 12
categories; the remaining categories are now being considered for embargo.
A five-power conference, held in Washington in July and-August
1952 and attended by representatives of M, UK France, Canada, and Japan
resulted in the establiebment of a China Coi=ittee (CEI1COM) within the
COCOM structure, which now serves as the principal forum for the discussion
of Far Eastern security trade control problems.
The informal COCA agreement to deny bareboat chartering of
non-Bloc vessels to the Sloop in circumvention of sale controls, has affected
but by no means obviated the ability of the USSR, and particularly of Poland
among the Satellites, to augment greatly the ocean-going fleet serving the Bloc.
(b) United Nations
Pursuant to the Resolution of the UN General Assembly, of 18 May
1951, forty-five nations have applied selective embargoes on the shipment to
Communist China of the following categories of goodss
(1) Arms, ammmenition, and Implements of war
(2) Atomic energy materials
(3) Petroleum
(4) Transportation mteriale of strategic value
(5) Items useful in the production of arms, ammunition,
and implements of war
3. ],e, feral McN~e~eg of Other Ton-Bloc Countries
The embargoes on the China trade of Canada and Japan have matched
the US controls in coverage and effectiveness, although same SOAP controls
have been discontinued in the latter country since the end of the occupation
in April 1952. The UK, which originally joined the US in imposing the ban
on arms shipments to China in January 1948, raga next in terms of control
coverage. All other non-Soviet industrial countries have adopted some measures
-3-
Approved For Release 2000/08/29: CIA-RDW1%47900900010010-9
 Approved For Release 2000/08/29 : CIA-RDP79S0101lA000900010010-9
restricting the movement of strategic goods to Commmumist China, with the UN
resolution and the COCOM lists serving as guides. Most significant was the
imposition of stricter controls, in July 1951, on the movement of strategic
commodities from Hong Kong to Communist China.
Costa Rica has similar controls as the US on the chartering of
Vessels to the Soviet Bloc. Panama, Costa Rica, Honduras, and Liberia have
regulations similar to the US prohibition of flag vessels calling at Communist
25X6A Chinese ports. Japan controls the allocation of its shipping, while in short
supply, by a registration requirement for the establishment of new liner
services. In the absence of further formal regulations, it is the avowed
policy of the Japanese Government not to permit chartering to!Bloc interests.
In the late fall of 1951, the UK arranged to have British oil companies
collaborate - on a voluntary basis and insofar as existing contracts would
not be affected - with US-controlled oil companies in enforcing a denial of
bunkers to vessels carrying strategic cargoes in the trade with Communist China,
B. E~CTWlV S OF F2 FORCEr NT OF C0NT OL
US regulations are strictly applied and are effective in denying US-controlled
.trade and shipping services to mist China. Western European controls are
effectively enforced with respect to the export of strategic ocumodities for
Communist China, but differences in control coverage among the various countries,
the lack of transit-trade and trans-shipment controls, and the haphazard
nature of transport controls leave available many avenues for circumvention
and control evasions.
US consuls, pursuant to instructions issued at the request of the govern-
ments of Penama,.Costa Rica, Honduras, and Liberia, have cooperated in the
enforcement of their shipping regulations by determining routings of suspect
vessels and assisting in the actual seizure of ship's papers.
There are no formal controls over the bunkering of vessels returning from
Communist China; even in the case of the US, the problems of application of
controls to cases of "triangular routing" (e.g. an Intermediate call by a
vessel at Yokohama prior to requesting bunkers at Singapore following an
original China-bound voyage) are still under study. In pursuing their -policy
of collaboration with US bunker aontrcln
25X6A 25X6A
carried aboard non-Bloc vessels for a Communist Chinese destination.- Bloc-
controlled vessels originally denied bunkers by both US and UK companies
have been supplied in Pakistan and Indonesia from government stocks ro by
the companies under local government pressure.
The number of British-flag vessels on China runs (i.e. vessels over
1,000 GRT) continues to increaae,and for 1953 increased China services were
being planned by Dutch, Danish, Norwegian, Finnish, and French shipping firms.
0. CIRCUM{ ENTX0N OF C0111TKOL
India, Pakistan, Burma, Ceylon, and Indonesia have continued to trade
Approved For Release 2000/08/29 CIA-RDE7RW101lA000900010010-9
 Approved For Release 2000/08/29 : CIA-RDP79S0101lA000900010010-9
The first three categories Include such important items as rai1Wsy
material, machine tools, motor vehicles, and tires. The instruments and
apparatus include industrial and other electrical and electronic equipment,
also of strategic interest. it may be presumed that these cargoes, as a
whole, included at least a high proportion of the recorded exports of
Western Turope, which were not shipped to China from Western ports, and
they probably included goods exported from the Went to Turopean ConinuniSt
countries and then re-exported to China in order to evade the stricter
Western European controls on direct exports to China.
The transportation of some strategic cargoes and virtually all non-
strategic trade for Communist China by sea has released the capacity of the
Trans-Siberian railroad for the carriage of strategic cargoes chiefly
bound for the support of the Korean war.
Cce mist Chinese imports by smuggling from other Far Lantern poipts
occupy an important position chiefly where lighter-Weight and smaller-size
commodities such as antibiotics, dyes, eta., are concerned. This traffic
is accomplished by smuggling between Hong Kong and Macao specifically, and
by means of the China-coast junk traffic in general.
-6-
Approved For Release 2000/08/29: CIA-F L7 FA000900010010-9