Out of Control: The loopholes in UK controls on the arms trade | Exports

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Out of Control is the second investigation that Oxfam has undertaken into UK involvement in the international arms trade and the effectiveness of UK arms export controls. Unregulated or ineffectively regulated supplies of arms can exacerbate armed conflict, producing enormous human suffering and undermining development including Oxfam's own work. Oxfam seeks the effective regulation of all arms supplies to reduce this suffering and increase the prospects of sustainable development. Out of Control investigates current loopholes in arms export controls that are exploited to allow the unregulated transfer of small arms to sensitive destinations - countries where they may contribute to human rights abuses, prolong existing conflict or waste resources needed to fight poverty. These loopholes have not been closed either by the tighter arms export guidelines introduced by the UK government in July 1997 or the subsequent EU Code of Conduct agreed in June 1998. In essence, this report looks at the part of the arms trade that still remains largely Out of Control.
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    Out of Control The loopholes in UK controls on the arms trade December 1998 © Oxfam GB, 1998    Contents Acknowledgements...................................................................................... ii  Executive Summary................................................................................... iii 1 Introduction.............................................................................................. 1 1.1 Purpose of the report.......................................................................................2 2 Arms brokering .......................................................................................................3 2.1 Brokering arms to sensitive destinations: case studies.................................4   2.1.1 Sandline and Sierra Leone..................................................................4 2.1.2 Peter Bleach and Border Technology and Innovation (BTI)..........6 2.1.3 Mil-Tec and Rwanda and Zaire.........................................................8 2.2 The July 1998 White Paper on Strategic Export Controls -an end to brokering?............................................................................................................10 2.3 Recommendations..........................................................................................12 3 Licensed Production ............................................................................................13 3.1 UK involvement in licensed production: case studies................................14 3.1.1 Heckler & Koch.................................................................................14 3.1.2 Land Rover and Otokar....................................................................18 3.2 UK export controls on licensed production.................................................18 3.3 Recommendations..........................................................................................21 4 Ineffective End Use Controls.................................................................. 22   4.1 Abuse of end-use controls: case studies ............................................22 4.1.1  Oxfam's end-user certificate...........................................................22 4.1.2  Occidental Airlines and Kent International Airport....................23 4.1.3  The Scott Report..............................................................................24 4.2 End-use monitoring systems currently in operation................ 26 4.3 Recommendations........................................................................ 27 5 Conclusion................................................................................................ 28   Tables Table 1............................................................................................................................15 Table 2............................................................................................................................16 i    Acknowledgements Many people have contributed helpful advice and criticism during the writing of this report. In particular, we would like to thank - Robin Ballantyne, Brian Johnson-Thomas, and Heather Rodgers.   ii    OUT OF CONTROL The loopholes in UK controls of the arms trade EXECUTIVE SUMMARY Out of Control   is the second investigation that Oxfam has undertaken into UK involvement in the international arms trade and the effectiveness of UK arms export controls. Unregulated or ineffectively regulated supplies of arms can exacerbate armed conflict, producing enormous human suffering and undermining development including Oxfam’s own work. Oxfam seeks the effective regulation of all arms supplies to reduce this suffering and increase the prospects of sustainable development. Oxfam’s first report Small Arms, Wrong Hands , published in April 1998,   focused on UK controls on legal sales. It revealed export licences being granted - including since May 1997 when the Labour government introduced its ethical foreign policy - to a large number of countries where human rights abuses, armed conflicts and poverty raised the question whether such exports were ethical. As importantly, it revealed the mechanics of secrecy of a system that meant that it was impossible for parliamentarians, the media or the public to confidently answer this question. Out of Control   investigates current loopholes in arms export controls that are exploited to allow the unregulated transfer of small arms to sensitive destinations - countries where they may contribute to human rights abuses, prolong existing conflict or waste resources needed to fight poverty. These loopholes have not been closed either by the tighter arms export guidelines introduced by the UK government in July 1997 or the subsequent EU Code of Conduct agreed in June 1998. In essence, this report looks at the part of the arms trade that still remains largely Out of Control  . The three principle loopholes investigated in this report are: 1. arms brokered by UK companies without ever passing through the UK 2. arms produced overseas under licence from UK companies 3. the failings of end-use monitoring and control Through a combination of existing case studies and specially commissioned research, Out of Control   identifies the involvement of UK citizens and UK companies in each area, and highlights the need for the UK government to take action to regulate these markets. Arms brokering Arms brokering is where an agent in one country arranges a deal between an arms supplier in a second country and a customer in a third. Currently, UK companies do not have to apply for export licences or any other official approval to broker arms from one foreign country to another because the arms never enter the UK and so are not covered by existing arms export controls. In addition, arms brokering was not included in the new EU Code of Conduct on arms sales agreed in June 1998. As a result British brokering companies are involved in the supply and shipment of arms to sensitive destinations - destinations to iii
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