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Ref. code: 25595601040297BDA
EXPORT CONTROL OF DUAL-USE ITEMS:
A COMPARATIVE STUDY OF THAI AND
FOREIGN LAWS
BY
MS. PIYANAT UAMDUANG
A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF
THE REQUIREMENTS FOR THE DEGREE OF
MASTER OF LAWS IN BUSINESS LAW (ENGLISH PROGRAM)
FACULTY OF LAW
THAMMASAT UNIVERSITY
ACADMIC YEAR 2016
COPYRIGHT OF THAMMASAT UNIVERSITY
Ref. code: 25595601040297BDA
EXPORT CONTROL OF DUAL-USE ITEMS:
A COMPARATIVE STUDY OF THAI AND
FOREIGN LAWS
BY
MS. PIYANAT UAMDUANG
A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF
THE REQUIREMENTS FOR THE DEGREE OF
MASTER OF LAWS IN BUSINESS LAW (ENGLISH PROGRAM)
FACULTY OF LAW
THAMMASAT UNIVERSITY
ACADMIC YEAR 2016
COPYRIGHT OF THAMMASAT UNIVERSIT
Ref. code: 25595601040297BDA
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Thesis Title EXPORT CONTROL OF DUAL-USE ITEMS:
A COMPARATIVE STUDY OF THAI AND
FOREIGN LAWS
Author Ms. Piyanat Uamduang
Degree Master of Laws
Major Field/Faculty/University Business Laws (English Program)
Faculty of Law,
Thammasat University
Thesis Advisor Professor Jumphot Saisoonthorn, Ph.D.
Academic Years 2016
ABSTRACT
The terrorists attack on 9 September 2001 in the United States the World
Trade Center and the Pentagon by the hijacked airplanes caused a great number of
casualties. As a result, terrorism has affected and become a new important problem in
global community.
Terrorists have developed complex processes to procure materials and
equipment for producing or obtaining WMD. Therefore, to prevent WMD
proliferation and terrorism, many developed states are trying to encourage other states
to develop their own effective export control measures for any material or technology
that can be used to develop WMD in order to prevent harm that may be caused to
peace and security of global community. Thus, “Dual-Use Items (DUI)” which are
referred to goods, software and technology that can be used for both civilian and
military applications and/or can contribute to the proliferation of WMD, are subject to
control under domestic export laws of each state. Thus, the United Nations Security
Council (UNSC) adopted the Resolution 1540 in 2004 requires all member states to
adopt domestic laws to prevent the proliferation of WMD by controlling concerned
activities namely export, re-export, transit, transshipment, brokerage, provision of
fund and service related to WMD or related materials which could be used for the
design, development, production or use of nuclear, chemical and biological weapons
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specified by relevant multilateral treaties. Many states in Asia, as members of the
United Nations, have developed domestic laws focused on export control measures of
DUI such as Japan, Singapore and Malaysia etc. to fulfil its obligations under such
Resolution.
As for Thailand, the Cabinet endorsed UNSCR 1540 since 10 August 2004
and the Thai government considered formulating national export control law
following the adoption of such Resolution. The export control law of DUI was
prescribed by the Ministry of the Commerce under the title of “The Ministerial
Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015),” on 16 October 2015, ten years
after the endorsement of Resolution 1540. This Ministerial Notification will take
effect on 1 January 2018. However, this Law has no provision regarding export
permission measures of DUI. Thus, this may cause unclear practices in operation of
the exporters. Moreover, this Ministerial Notification does not cover brokerage and
intangible technology transfer. Likewise, this Law is issued under “Export and
Import of Goods Act B.E.2522 (1979)” under which penalty is not specified on the
basis of intention and knowledge of violator.
This thesis mainly focuses on the enforcement of the Ministerial Notification
Specifies Dual-Use Items as Goods Requiring Permission and Complying the Export
Measures B.E.2558 (2015) and the draft Trade Control on Weapons of Mass
Destruction Related Items approved by the Cabinet in comparison with export control
laws of DUI of Japan, Singapore and Malaysia in order to increase the effectiveness
of export control system to prevent the proliferation of WMD together with to
facilitate the permission process of controlled activities and to reduce difficulties
caused to the operations of the entrepreneurs.
Keywords: Dual-Use Items, Weapon of Mass Destruction, DUI, WMD
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ACKNOWLEDGEMENTS
This thesis is a part of Master of Laws in Business Laws (English
Program), Faculty of Law, Thammasat University that could not have been achieved
and completed without support, assistance and encouragement of many people.
Firstly, I would like to express my deepest gratitude to my advisor,
Professor Jumphot Saisoonthorn for his valuable comments and suggestions on the
first draft of this thesis, until the completion. Without his support, I would not have
been able to complete my thesis. Furthermore, I would like to express my sincere
gratitude to Justice Nopporn Bhotirungsiyakorn, Professor Dr. Amnat Wongbandit,
and Associate Professor Nartnirun Junngam for devoting their valuable time to be my
thesis committee and providing instructions, guidance and advice which assisted me
in completing this thesis.
Also, I would like to express my special thanks to Thai Yamaha Motor
Company Limited for providing me an invaluable opportunity to study and obtain
legal knowledge and experiences in this course. Likewise, I would like to extend
special thanks to my superior, Mr. Phongstorn Ermongkonchai and Mr. Chaidej
Navyvichit, for their kind support and encouragement.
In addition, I would like to thank Ms. Sudarat Pongpitak for initial idea
that inspired me to start this thesis.
Finally, I would like to thank my beloved family and my friends for
support, motivation and encouragement that provided energy to me for completion of
this thesis.
MS. Piyanat Uamduang
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TABLE OF CONTENTS
Page
ABSTRACT (1)
ACKNOWLEDGEMENTS (3)
LIST OF TABLES (11)
LIST OF FIGURES (12)
LIST OF ABBREVIATIONS (13)
CHAPTER 1 INTRODUCTION 1
1.1 Background and Problems 1
1.2 Hypothesis 5
1.3 Objectives of Study 6
1.4 Scope of Study 6
1.5 Methodology 7
1.4 Expected Result 7
CHAPTER 2 BACKGROUND AND NATUREOF EXPORT CONTROL ON 8
DUAL-USE ITEMS
2.1 Concept of Export Control of Dual-Use Items 8
2.1.1 Definition of Weapons of Mass Destruction and 9
Dual-Use Items
2.1.1.1 Weapons of Mass Destruction (WMD) 9
2.1.1.2 Means of Delivery 9
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2.1.1.3 Related Materials 9
2.1.1.4 Dual-Use Items 10
2.1.2 Examples of Dual-Use Items 10
2.1.2.1 Category 0 Nuclear Materials, Facilities 11
and Equipment
2.1.2.2 Category 1 Materials, Chemical, Microorganisms 13
and Toxins
2.1.2.3 Category 2 Materials Processing 16
2.1.2.4 Category 3 Electronics 21
2.1.2.5 Category 4 Computers 24
2.1.2.6 Category 5 Telecommunications and 25
Information Security
2.1.2.7 Category 6 Sensors and Lasers 26
2.1.2.8 Category 7 Navigation and Avionics 27
2.1.2.9 Category 8 Marine 29
2.1.2.10 Category 9 Aerospace and Propulsion 30
2.1.3 Activities Subjected to Control 31
2.1.3.1 Export 31
2.1.3.2 Re-Export 31
2.1.3.3 Transit 31
2.1.3.4 Transshipment 31
2.1.3.5 Brokerage 32
2.1.3.6 Technology Transfer 32
2.1.4 The Importance of Penalties for Violation 32
2.2 International Laws on Export Control of Dual-Use Items 33
2.2.1 The International Non-Proliferation Agreement 33
2.2.1.1 Treaty on the Non-Proliferation of 33
Nuclear Weapons (NPT)
2.2.1.2 Biological Weapons Convention (BWC) 34
2.2.1.3 Chemical Weapons Convention (CWC) 35
2.2.2 United Nations Security Council Resolution 1540 36
2.2.3 The Multilateral Export Control Regimes 37
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2.2.3.1 Nuclear Suppliers Group (NSG) 38
2.2.3.2 Australia Group (AG) 38
2.2.3.3 Missile Technology Control Regime (MTCR) 39
2.2.3.4 Wassenaar Arrangement (WA) 39
CHAPTER 3 EXPORT CONTROL OF DUAL-USE ITEMS 41
IN FOREIGN COUNTRIES
3.1 Japan 44
3.1.1 Laws and Regulations 45
3.1.1.1 Foreign Exchange and Foreign Trade Act (1998) 45
3.1.1.2 Cabinet Orders 45
3.1.1.3 Ministerial Order 46
3.1.2 Transaction Subject to Control 46
3.1.3 Classification of Controlled Items 46
3.1.3.1 List Control 46
3.1.3.2 Catch-all Control 48
3.1.3.3 Technology Transfer Control 49
3.1.3.4 Special Control for Restricted Country 50
3.1.4 Permission 50
3.1.4.1 Individual Permission 50
3.1.4.2 Bulk Permission 50
3.1.4.2.1 General Bulk Export License or 51
Bulk License for White Countries
3.1.4.2.2 Special General Bulk Export License or 51
Bulk License for Combination of Items
and Destination
3.1.4.2.3 Special Bulk Export License or 52
Bulk License for the Same Customer
3.1.4.2.4 Special Bulk Export License for 52
Repair and Replacement
3.1.2.2.5 Special Bulk Export License for 52
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Oversea Subsidiaries
3.1.5 Offences, Penalty and Sanction 53
3.1.5.1 Offence and Penalty 53
3.1.5.2 Administrative Sanction 54
3.1.5.3 Warning 54
3.1.6 Internal Compliance Program (ICP) 54
3.2 Singapore 57
3.2.1 Laws and Regulations 57
3.2.1.1 Strategic Goods (Control) Act (“SGCA”) 58
3.2.1.2 Strategic Goods (Control) Regulations (“SGCR”) 58
3.2.2 Transaction Subject to Control 58
3.2.3 Classification of Controlled Items 58
3.2.3.1 List Control 58
3.1.3.1.1 Munitions List 59
3.1.3.1.2 Dual-Use List 59
3.2.3.2 Catch-all Control 59
3.2.3.3 Technology Transfer Control 59
3.2.3.4 Special Control for Restricted Country 59
3.2.4 Permission 60
3.2.4.1 Individual Permission 60
3.2.4.2 Bulk Permission 60
3.2.4.2.1 Bulk License for Specific Entities 60
3.2.4.2.2 Bulk License for Country of Destination 60
3.2.5 Offence, Penalty and Sanction 61
3.2.6 Internal Compliance Program (ICP) 62
3.3 Malaysia 63
3.3.1 Laws and Regulations 64
3.3.1.1 Strategic Trade Act 2010 65
3.3.1.2 Strategic Trade (Strategic Items) (Amendment) 66
Order 2017
3.3.1.3 Strategic Trade (Restricted End-Users and 67
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Prohibited End-User) Order
3.3.1.4 Strategic Trade Regulation 2010 67
3.3.2 Transaction Subject to Control 67
3.3.3 Classification of Controlled Items 68
3.3.3.1 List Items (List Control) 68
3.3.3.1.1 Military Items List 68
3.3.3.1.2 Dual-Use Items List 69
3.3.3.2 Unlisted Items (Catch-all Control) 70
3.3.3.3 Technology Transfer Control 71
3.3.3.4 Special Control for Restricted Country 71
3.3.4 Permission 72
3.3.4.1 Single-Use Permit 72
3.3.4.2 Bulk Permit 72
3.3.4.3 Multiple-Use Permit 73
3.3.4.4 Special Permit 73
3.3.5 Permit for Brokering 73
3.3.6 Offence, Penalty and Sanction 74
3.3.7 Internal Compliance Program (ICP) 81
CHAPTER 4 EXPORT CONTROL ON DUAL-USE ITEMS IN THAILAND 83
4.1 Applicable Export Control System in Thailand 85
4.1.1 Laws and Regulations 86
4.1.2 Transaction Subject to control 86
4.1.3 Classification of Controlled Items 87
4.1.3.1 List 1 or List of Dual-Use Items 87
4.1.3.2 List 2 or HS Code List 88
4.1.4 Permission 88
4.1.4.1 E-Classification 88
4.1.4.2 E-Certification 88
4.1.4.3 E-Licensing 88
4.1.5 Offence, Penalty and Sanction 89
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4.1.6 Internal Compliance Program (ICP) 89
4.2 Draft Trade Control of WMD Related Items Act 90
4.2.1 Laws and Regulations 90
4.2.2 Transaction Subject to control 91
4.2.3 Classification of Controlled Items 91
4.2.3.1 List 1 or List of Dual-Use Items 91
4.2.3.2 List 2 or HS Code List 92
4.2.4 Permission 92
4.2.4.1 E-Classification 92
4.2.4.2 E-Certification 93
4.2.4.3 E-Licensing 93
4.2.5 Offence, Penalty and Sanction 93
4.2.6 Internal Compliance Program (ICP) 98
4.3 Problems on Export Control of Dual-Use Items in Thailand 99
4.3.1 Non-Compliance with UN Resolution 1540 on 99
the Control of Technology Brokering
4.3.2 Non-Compliance with UN Resolution 1540 on 99
the Control of Technology Transfer
4.3.3 Export Control System 101
4.2.3 Penalty and Sanction 102
CHAPTER 5 CONCLUSIONS AND RECOMMENDATIONS 104
5.1 Conclusions 104
5.2 Recommendations 105
5.2.1 Establishing Export Control for Brokering and 105
Technology Transfer
5.2.2 Categories Export License to be Individual License and 106
Bulk License
5.2.3 Establishing Internal Control Program (ICP) 107
5.2.4 Infliction of the Penalties of Each Offences Based on 107
Ground of Intention and Knowledge of Violator
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5.2.5 Establish Administrative Penalties for Violation 108
without Intention.
REFERENCE 109
BIOGRAPHY 113
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LIST OF TABLES
Tables Page
3.1 List Control of Japan 47
3.2 Catch-all control 48
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LIST OF FIGURES
Figures Page
2.1 Structure of ECCN of EU’s DUI List 10
2.2 Pressure Tubes 11
2.3 Heat Exchangers (Stream Generators) 12
2.4 Titanium Alloys 13
2.5 Aluminium Alloys 14
2.6 Carbon Fiber 15
2.7 Turning Machine 16
2.8 Machining Center 17
2.9 CNC Lathe 18
2.10 Pressure Transducers 19
2.11 Chemical Reaction Vessels 20
2.12 Analogue to Digital Converter 21
2.13 Capacitors 22
2.14 Frequency Changers 23
2.15 Computers and Related Equipment 24
2.16 Optical Fiber Communication Cables 25
2.17 Sensors 26
2.18 Navigator 27
2.19 Accelerometers 28
2.20 Robot Designed for Underwater Use 29
2.21 Unmanned Aerial Vehicles (UAVs) 30
2.18 Navigator 27
3.1 Export Control Procedure in Japan 56
3.2 Permission of DUI under Singapore Laws in Briefing 63
3.3 Permission of DUI under Malaysia Laws in Briefing 82
3.4 Permission of DUI under Thai Laws in Briefing 90
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LIST OF ABBREVIATIONS
Symbols/Abbreviations Terms
AG Australia Group
BWC Biological Weapons Convention
CWC Chemical Weapons Convention
DUI Dual-Use Items
ICCPR International Covenant on Civil
and Political Rights
ICP Internal Compliance Program
METI Ministry of Economy, Trade and Industry
of Japan
MOC Ministry of Commerce of Thailand
MTCR Missile Technology Control Regime
NPT Treaty on Non-Proliferation of
Nuclear Weapons
NSG Nuclear Suppliers Group
TCWMD Trade Control on Weapons of Mass Destruction
Related Items Act
UN United Nations
UNSC United Nations Security Council
WA Wassenaar Arrangement
WMD Weapons of Mass Destruction
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CHAPTER 1
INTRODUCTION
1.1 Background and Problems
After 9/11 attacks on 9 September 2001 the major terrorism in the United
States where the terrorists attacked the World Trade Center, the twin towers in
Manhattan and the Pentagon, the headquarters of the Department of Defense in
Arlington, United States, by the commercial airplanes hijacked by the members of
Al-Qaeda, an international terrorist group1 caused a great number of casualties
2.
As a result, terrorism has affected and become a new important problem in global
community. From such incident, the world has experienced terrorist attacks and
terrorism has brought loss, damage, pain, sorrow, terror, and insecurity to all states
whether directly or indirectly. At present, the threat of terrorism becomes more
serious; because, terrorists attempt to attack the states with the “Weapons of Mass
Destruction (WMD)” such as missiles, nuclear weapons, biological weapons, and
chemical weapons3 to inflict a great number of casualties.
Currently, terrorists have developed complex processes to procure
materials and equipment for producing or obtaining WMD; because, using WMD for
military or terrorism purposes could have severe impact for humankind, global
environment4 and international security that could cause psychological effect to the
public. From the history of terrorism, there are many ways that terrorists used for
attacks such as bombing, chemical terrorism or bioterrorism.
1 911 Memorial & Museum, ‘FAQ About 9/11: What Happened on 9/11?’
<https://www.911memorial.org/faq-about-911> accessed 18 November 2016.
2 Becky Little, Brian Clark Howard, Brian Handwerk, ‘National Geographic: Remembering 9/11 in
Picture on the 15th Anniversary’ (9 September 2016)
<http://news.nationalgeographic.com/2016/09/september-11-pictures-remembrance/> accessed
11 October 2016.
3 United Nations Office for Disarmament Affair, ‘Weapon of Mass Destruction’
<https://www.un.org/disarmament/wmd/missiles/> accessed 16 January 2017.
4 Anna Wetter, ‘Enforcing European Union Law on Exports of Dual-Use Goods’ (1st edn, Oxford
University Press 2009) 1.
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Examples of terrorism occurred in the past are as follows.
1) Terrorists used nerve gas called “Sarin” attacked a Tokyo subway
station in Japan since 1995 which killed twelve persons and injured more than
5,000 persons;5
2) Terrorists attacked Bali, a tourist island of Indonesia by bombs in 2002
which killed 202 persons and injured more than 200 persons;6
3) Terrorists attacked the train in Madrid by bombs which killed 191
persons and injured almost 2,000 persons;7 and
4) Terrorists attacked Paris by guns and bombs in 2015. In this incident,
three suicide bombers attacked the Bataclan Concert Hall in Paris which killed 136
persons8 and injured more than 350 persons.
9
Therefore, to prevent WMD proliferation and terrorism, many developed
states are trying to encourage other states to develop their own effective export
control measures for any material or technology that can be used to develop WMD in
order to prevent harm that may be caused to peace and security of global
community10
. Thus, “Dual-Use Items (DUI)” which are referred to goods, software
and technology that can be used for both civilian and military applications and/or can
contribute to the proliferation of WMD,11
are subject to control under domestic export
laws of each state. Moreover, terrorism in the past proved that only international
5 History.com Staff, ‘Tokyo Subways are attacked with Sarin Gas’ (2009)
< http://www.history.com/this-day-in-history/tokyo-subways-are-attacked-with-sarin-gas > accessed
1 January 2017.
6 History.com Staff, ‘Terrorists Kill 202 in Bali’ (2010).
< http://www.history.com/this-day-in-history/terrorists-kill-202-in-bali > accessed 1 January 2017.
7 History.com Staff, ‘Terrorists Bomb Trains in Madrid’ (2010)
< http://www.history.com/this-day-in-history/terrorists-bomb-trains-in-madrid > accessed 1 January
2017.
8 Institute for Economics and Peace, ‘Global Terrorism Index 2016’, 13.
< http://economicsandpeace.org/wp-content/uploads/2016/11/Global-Terrorism-Index-2016.2.pdf >
accessed 1 January 2017.
9 ABC News, ‘Paris attacks: More than 120 killed in concert hall siege, bombings and shootings;
suspected terrorists dead’ (15 November 2015) <http://mobile.abc.net.au/news/2015-11-14/paris-
attacks-120-dead-in-shootings-explosions/6940722> accessed 1 Jan 2017.
10 United Nations Security Council Resolution 1540 (2004), Intro.
11 European Commission, ‘Dual-Use Export Controls’ < http://ec.europa.eu/trade/import-and-export-
rules/export-from-eu/dual-use-controls/ > accessed 16 January 2017.
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treaties and agreements cannot prevent the proliferation of WMD. Consequently, the
United Nations Security Council (UNSC) adopted the Resolution 1540 in 2004
requiring all states to pass and enforce its domestic laws on export control of WMD12
that include DUI to prevent proliferation of WMD and to promote international
stability by inflicting both criminal and administrative penalties for any violation of
such laws.
Base on the United Nations Security Council Resolution 1540 (UNSCR
1540) mentioned above, many states in Asia, as members of the United Nations, have
developed domestic laws focused on export control measures of DUI such as Japan13
,
Singapore14
and Malaysia15
etc. to fulfil its obligations under such Resolution.
As for Thailand, the Cabinet endorsed UNSCR 1540 since 10 August
200416
and the Thai government considered formulating national export control law
following the adoption of such Resolution. The first export control law of DUI was
prescribed by the Ministry of the Commerce under the title of “the Ministerial
Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015),” on 16 October 2015, ten years
after the endorsement of Resolution 1540. This Ministerial Notification will take
effect on 1 January 2018, two years after its publication in the Royal Gazette.17
This Ministerial Notification covers the controlled activities namely
export, re-export, (bringing in) transit and transshipment of DUI18
from Thailand; but,
12 United Nation Security Council Resolution 1540 (2004), Art 3.
13 Foreign Exchange and Foreign Trade Act.
14 Strategic Goods (Control) Act, Cap. 300.
15 Strategic Trade Act 2010.
16 United Nations Security Council, ‘Security Council Established Pursuant to Resolution 1540 (2004):
Note to Verbale Dated 5 November 2004 from the Permanent Mission of Thailand to the United
Nations Addressed to the Chairman of the Committee [S/AC.44/2004/(02)/71], Art 2.1.
17 The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015), Ministry of Commerce, Section 2.
18 Ibid, Section 3.
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does not cover brokerage and intangible technology transfer19
. UNSC Resolution
1540 requires all member states to adopt domestic laws to prevent the proliferation of
WMD by controlling concerned activities namely export, re-export, transit,
transshipment, brokerage, provision of fund and service related to WMD or related
materials which could be used for the design, development, production or use of
nuclear, chemical and biological weapons specified by relevant multilateral
treaties20
those are included technology transfer.
Thus, Thailand as a member of the United Nations (UN) is obligated to
fulfil the obligations under such Resolution by adopting national export control law
covering DUI, technology transfer and any activities related to WMD namely export,
re-export, transit, transshipment and brokerage to prevent the proliferation of WMD
and to strengthen export control enforcement of the state.21
Besides, the bigger
economies such as the United States, the United Kingdom, Japan, including such
Asean counties as Singapore and Malaysia, all have adopted domestic laws on export
control of DUI. Likewise, other Asean members such as Vietnam, Philippines and
Indonesia are in the process of adopting such laws on the basis of UNSC Resolution
1540.22
Hence, it is important for Thailand to have the national law on export
control of DUI specifically concerning non-proliferation of WMD to implement
UNSC Resolution 1540.
Nevertheless, during the grace period of the Ministerial Notification
Specifies Dual-Use Items as Goods Requiring Permission and Complying the Export
Measures B.E.2558 (2015), the Cabinet of Thailand approved the concept of “Trade
Control on Weapons of Mass Destruction Related Items (TCWMD)” on 4 October
19Tamotsu Aoi, ‘Historical Background of Export Control Development in Selected Countries and Regions’ (2016) 17.
20 United Nations Security Council Resolution 1540 (2004), Definitions.
21 Ibid, Art 3.
22 George Tan, ‘Emerging Export Control Regimes in Asean & Best Practice for ICP: Challenges and
Pitfalls’ 6. < http://supportoffice.jp/outreach/2011/malaysia/1-3_Mr._Tan_Brayan_Cave.pdf >
accessed 17 January 2017.
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2016 to control export, re-export, transit, transshipment and brokerage of all goods
that can be used to develop WMD including DUI to prevent proliferation of WMD.
After such approval, the draft TCWMD will be considered by the Office of the
Council of State before proposing to National Legislative Assembly for
consideration.23
Therefore, this thesis studies the enforcement of the Ministerial
Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015) and the draft Trade Control on
Weapons of Mass Destruction Related Items approved by the Cabinet in comparison
with export control laws of DUI of Japan, Singapore and Malaysia in order to increase
the effectiveness of export control system to prevent the proliferation of WMD
together with to facilitate the permission process of controlled activities and to reduce
difficulties caused to the operations of the entrepreneurs.
1.2 Hypothesis
The Ministerial Notification Specifies Dual-Use Items as Goods Requiring
Permission and Complying the Export Measures B.E.2558 (2015) does not covered
all requirements under UNSC Resolution 1540 because its enforcement does not
cover brokerage and intangible technology transfer. Furthermore, there is no provision
regarding export license measures that could be applied. Likewise, this Ministerial
Notification is issued under “Export and Import of Goods Act B.E.2522 (1979)24
”
under which penalty is not specified on the basis of intention and knowledge of
violator. Therefore, this thesis suggests that it is an appropriate for Thailand to have
the “Trade Control on Weapons of Mass Destruction Related Items Act” that covers
DUI, intangible technology transfer and any activity related to WMD in order to
ensure security and to protect the benefits of the state in compliance with international
agreements and to protect Thai entrepreneurs against non-tariff trade barriers by other
23 Thai Cabinet Resolution on “Draft of Trade Control on Weapons of Mass Destruction Related Items”
dated 4 Oct 2016.
<http://www.ofm.mof.go.th/images/stories/pdf/98907_591004.pdf> accessed 5 October 2016.
24 Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and Complying
the Export Measures B.E.2558 (2015), Ministry of Commerce, Intro Para 2.
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states. In this Act, the Thai government should specify the penalty of each offense
based on intention and knowledge of the violator. Likewise, Thailand should take
export control measures for DUI for trade management such as export license
procedure, technology transfer procedure and internal control program for exporters
etc. in order to ensure that DUI are controlled and the entrepreneurs and their staffs
are able to understand and comply with Thai export control laws.
1.3 Objectives of Study
1.3.1 To examine and analyze the principles and scope of export control
of DUI.
1.3.2 To examine and analyze international law on export control of DUI.
1.3.3 To examine and analyze Thai laws on export control on DUI in
comparison with foreign laws in order to develop Thai export
control laws to comply with international obligations, to build
confidence among investors to invest in Thailand, to promote
Thailand to be a safe country for trade and investment and to protect
Thai entrepreneurs against non-tariff trade barriers by other
countries.
1.4 Scope of Study
Referring to the provisions of UNSC Resolution 1540 that “requires all
member states to take and enforce effective measures to establish domestic controls
and law enforcement over WMD and related materials which could be used for the
design, development, production or use of WMD that are covered by relevant
multilateral treaties”25
, this thesis will focus only on “Dual-Use Items (DUI) which
are goods and technologies having both civilian and military applications26
in order to
understand the principles of export control of DUI. This thesis will study the
background, international law, foreign laws, and Thai laws in light of such
international law and in comparison with such foreign laws.
25 United Nation Security Council Resolution 1540 (2004), Art 3.
26 The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015), Ministry of Commerce, Section 3.
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1.5 Methodology
The methods used in this thesis are based on documentary research which
are involved the study and analysis of textbooks, legal articles, law journals,
international law, foreign and Thai laws, including the information obtained from
conducting internet researches and government publications.
1.6 Expected Result
1.6.1 To understand the principles and scope of export control of DUI.
1.6.2 To establish international law on export control of DUI.
1.6.3 To improve Thai law regarding export control of DUI to ensure
compliance with international obligations and to build confidence
among investors to invest in Thailand, to promote Thailand to be a
safe country for trade and investment and to protect Thai
entrepreneurs against non-tariff trade barriers by other countries.
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CHAPTER 2
BACKGROUND AND NATURE OF EXPORT CONTROL
OF DUAL-USE ITEMS
2.1 Concept of Export Control of Dual-Use Items
Nowadays, terrorists have and continue to attempt to attack many states
with WMD to inflict greater numbers of casualties and threaten to cause loss, damage,
pain, death, sorrow, terror, and insecurity to the public. To achieve such objectives of
terrorism, terrorists are trying to develop complex processes to procure materials and
equipment for producing or obtaining WMD by using DUI as a composition.
From the incident mentioned above, proliferation of WMD could have
extreme impact on humankind and global environment. Thus, it is the obligation of
each state to prevent WMD proliferation and terrorism by developing its own systems
to build up efficient export control of DUI to eliminate the risk that such DUI will be
used for a part of WMD.
Scopes of DUI export control are generally specified by international
cooperation and national laws that cover list of controlled items, classification,
controlled activities, export measures, authorities, enforcement mechanism, penalties
and sanctions applied to the violation of export control laws including provisions on
restricted customers, users and destination on export control of DUI.
Non-proliferation of WMD and DUI export control could create an
essential contribution in the global community to fight against terrorism by reducing
risk of terrorists or any non-state actor for gaining access to WMD or related materials
from illegal export of DUI. Therefore, any state subject to establish measures for
international cooperation and domestic laws to control and prevent the increase of
WMD and their means of delivery including related materials, equipment and
technology for contribution and maintenance of international peace and security.
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2.1.1 Definition of Weapons of Mass Destruction and Dual-Use Items
UNSC Resolution 1540 requires the member states of the United Nations
to establish national control to prevent the proliferation of nuclear, chemical, or
biological weapons that could be called “WMD” including their means of delivery
and related materials27
which include DUI.
According to the items subject to control under UNSC Resolution 1540,
the definitions of such items are as follows.
2.1.1.1 Weapons of Mass Destruction (WMD)
Weapons of Mass Destruction (WMD) refers to all types of weapons such
as nuclear, chemical, biological weapons which could cause harm to a large number
of people or cause serious damage to the environment, including wire-guided missile
system, missiles or any other unmanned control system of such weapons.28
2.1.1.2 Means of Delivery
Means of Delivery refers to missiles, rockets and other unmanned systems
which are designed for the use of delivery of nuclear, chemical, or biological
weapons.29
2.1.1.3 Related Materials
Related Materials refer to any material, equipment, and technology which
is controlled by multilateral treaties and arrangements, or national control list and
these materials could be used for the purposes of design, development, production or
use for nuclear, chemical and biological weapons and their means of delivery.30
27 United Nation Security Council Resolution 1540 (2004), Art 3.
28 The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015), Ministry of Commerce, Section 3.
29 United Nation Security Council Resolution 1540 (2004), Definitions 1.
30 Ibid.
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Product Group A. System, Equipment & Component
B. Test, Inspection & Product Equipment
C. Materials
D. Software
E. Technology
2.1.1.4 Dual-Use Item
Dual-Use Item refers to a product, technology and software which can be
used for civilian and military applications and/or can contribute to the increase of
WMD.31
2.1.2 Examples of Dual-Use Items
This thesis categorizes DUI based on EU List because it has been adopted
by international agreements on export control of DUI including WA, MTCR, NSG,
AG and CWC. 32
Furthermore, it has been used as a model of controlled list of DUI
for many states outside EU such as Singapore, Malaysia and Thailand. Under the
controlled list, there are four digits and one letter used for classification and
identification of DUI that are selected from Category, Product Group and Type of
Control called “Export Control Classification Number (ECCN)”.
Figure: 2.1 Structure of ECCN of EU’s DUI List
The categorization of DUI based on EU List are separated as 0-9 namely.
31 European Commission, ‘Trade: Dual-Use Export Control’ < http://ec.europa.eu/trade/import-and-
export-rules/export-from-eu/dual-use-controls/ > accessed 18 Nov 2016. 32 Regulation (EC) No. 1334/2000, Art 3 and Annex I, 1.
Category Number 0-9
Type of Controls 0 National Security Reasons
1 Missile Technology Reasons
2 Nuclear Nonproliferation Reasons
3 Chemical & Biological Weapons Reasons
X X X XX
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2.1.2.1 Category 0 Nuclear Materials, Facilities and Equipment
Figure 2.2 Pressure Tubes33
Pressure Tubes have been used in the pressure gauge for civilian
purpose34
or applied for Nuclear Reactor as a container of fuel elements for military
purpose.35
Pressure Tubes is in Category 0, Product group A “Systems, Equipment
and Components” and Type of Control 001.36
Then, Export Control Classification
Number (ECCN)37
of Pressure Tubes is 0A001.38
Figure 2.3 Heat Exchangers (Steam Generators)39
33 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 4.
34 Ibid.
35 Ibid.
36 Regulation (EC) No. 1334/2000, Annex I, 24.
37 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
“ECCN” consist of a set of digits and a letter e.g. 3A001, 5B992, 1C350 used to identify and classify
controlled items.”
38 Regulation (EC) No. 1334/2000, Annex I, 24.
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Heat Exchangers have been used to be coolant for civilian purpose40
or
applied for Nuclear Reactor as coolant circuit for military purpose.41
Heat Exchangers is in Category 0, Product group A “Systems, Equipment
and Components” and Type of Control 001.42
Then, Export Control Classification
Number (ECCN) of Heat Exchangers is 0A001.
2.1.2.2 Category 1 Materials, Chemicals, Microorganisms and
Toxins
39 Sunry Petroleum Equipment Co., Ltd., ‘Stream Heat Exchanger’
< http://www.sunrypetro.com/steam_heat_exchanger.html > accessed 17 June 2017.
40 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 4.
41 Ibid.
42 Regulation (EC) No. 1334/2000, Annex I, 24.
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Figure 2.4 Titanium Alloys43
Titanium Alloys have been used as materials for making machinery,
vehicles, driver or medical equipment for civilian purpose44
or applied as a component
of rotor structure of centrifuge for military purpose.45
Titanium Alloys are in Category 1, Product group C “Materials” and Type
of Control 002.46
Then, Export Control Classification Number (ECCN) of Titanium
Alloys is 1C002.
Figure 2.5 Aluminium Alloys47
43 Star Enterprises, ‘Titanium Alloys’ <http://www.starentps.com/titanium.html> accessed 17 June
2017.
44 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 5.
45 Ibid.
46 Regulation (EC) No. 1334/2000, Annex I, 47.
47 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. <https://csis-
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Aluminium Alloys have been used in air craft industry for civilian
purpose48
or used for Centrifuge Rotors for military purpose.49
Aluminium Alloys are in Category 1, Product group C “Materials” and
Type of Control 002.50
Then, Export Control Classification Number (ECCN) of
Aluminium Alloys is 1C002
Figure 2.6 Carbon Fiber51
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf>
accessed 17 June 2017.
48 Ibid
49 Ibid.
50 Regulation (EC) No. 1334/2000, Annex I, 47.
51 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. <https://csis-
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Carbon Fiber has been used in sporting goods industry such as golf clubs,
tennis racket,52
bicycle frames, helmets and surfboards etc., automotive part such as
racing car chassis, hoods, mufflers and steering wheels etc., and aerospace
engineering53
for civilian purpose or utilized in a centrifuge and a production of
missile and convention arms54
for military purpose.
Carbon Fiber is in Category 1 and 9, Product group C “Materials” and
Type of Control 010, 210 and 110.55
Then, Export Control Classification Number
(ECCN) of Carbon Fiber is 1C010, 1C210 and 9C110.
2.1.2.3 Category 2 Materials Processing
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf>
accessed 17 June 2017.
52 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 5.
53 Charlie Tacchi, Zack Peters, Cody Van Beek and Philip Tran, ‘Carbon Fiber’
<http://srjcstaff.santarosa.edu/~yataiiya/E45/PROJECTS/Carbon%20Fiber.pdf >
54 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
55 Regulation (EC) No. 1334/2000, Annex I, 47.
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Figure 2.7 Turning Machine56
Turning Machines have been used for making machinery parts or
automotive parts for civilian purpose57
or used for making parts of atomic bomb or
Centrifuge for military purpose.58
Turning Machine is in Category 2, Product group B “Test, Inspection and
Production Equipment” and Type of Control 201.59
Then, Export Control
Classification Number (ECCN) of Turning Machine is 2B201.
Figure 2.8 Machining Center60
56 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 5.
57 Ibid.
58 Ibid.
59 Regulation (EC) No. 1334/2000, Annex I, 76.
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Machining Centers have been used in many industries e.g. automotive,
aerospace, electronics for civilian purpose61
or applied for producing U-enrichment
components for military purpose.62
Machining Center is in Category 2, Product group B “Test, Inspection and
Production Equipment” and Type of Control 001 and 201.63
Then, Export Control
Classification Number (ECCN) of Machining Center is 2B001 and 2B201.
Figure 2.9 CNC Lathe64
60
Direct Industry, ‘DMG Mori: 3-axis machining center / vertical / high-precision / high-performance
DMC 650 V’ < http://www.directindustry.com/prod/dmg-mori/product-5973-1312747.html > accessed
17 June 2017.
61 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
62 Ibid.
63 Regulation (EC) No. 1334/2000, Annex I, 76 and 85.
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CNC Lathes have been used in many industries e.g. automotive, aerospace,
electronics for civilian purpose65
or applied for producing U-enrichment components
for military purpose.66
CNC Lathe is in Category 2, Product group B “Test, Inspection and
Production Equipment” and Type of Control 001.67
Then, Export Control
Classification Number (ECCN) of CNC Lathe is 2B001.
Figure 2.10 Pressure Transducers68
64 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017. 65 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
66 Ibid.
67 Regulation (EC) No. 1334/2000, Annex I, 76.
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Pressure Transducers have been used in semiconductor manufacturing,
chemical processing engineering tests etc. for civilian purpose69
or used as a
component part of pressure measurements of UF6 during gas centrifuge process for
military purpose.70
Pressure Transducers is in Category 2, Product group B “Test, Inspection
and Production Equipment” and Type of Control 230.71
Then, Export Control
Classification Number (ECCN) of Pressure Transducers is 2B230.
Figure 2.11 Chemical Reaction Vessels72
68 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
69 Ibid.
70 Ibid.
71 Regulation (EC) No. 1334/2000, Annex I, 89.
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Chemical Reaction Vessels have been used in petrochemical,
pharmaceuticals, oil and gas industries for civilian purpose73
or used as a component
part of Synthesizing Chemicals for military purpose.74
Chemical Reaction Vessels is in Category 2, Product group B “Test,
Inspection and Production Equipment” and Type of Control 350.75
Then, Export
Control Classification Number (ECCN) of Chemical Reaction Vessels is 2B350.
2.1.2.4 Category 3 Electronics
Figure 2.12 Analogue to Digital Converter76
72 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017. 73 Ibid.
74 Ibid
75 Regulation (EC) No. 1334/2000, Annex I, 90.
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Analogue to Digital Converters have been used in many industries e.g.
automotive, electronics, computer and aerospace for civilian purpose77
or applied for
high speed data conversion of missile for military purpose.78
Analogue to Digital Converter is in Category 3, Product group A “System,
Equipment and Components” and Type of Control 001 and 101.79
Then, Export
Control Classification Number (ECCN) of Analogue to Digital Converter is 3A001
and 3A101.
Figure 2.13 Capacitors80
76 Department of Foreign Trade of Thailand, ‘Examples of WMD-Related Strategic Commodities’
<http://web.dft.go.th/Portals/2/ContentManagement/Document_Mod638/8%20Examples%20of%20W
MD -Related%20Strategic%20Commidities%20(Eng)@25541019-1121508107.pdf >
77 Ibid.
78 Ibid.
79 Regulation (EC) No. 1334/2000, Annex I, 110.
80 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
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Capacitors have been used as a component part of engine ignition system,
or radar and lasers for civilian purpose81
or used to store the energy to be discharged
by the switching device to the detonator for military purpose.82
Capacitors is in Category 3, Product group A “System, Equipment and
Components” and Type of Control 201.83
Then, Export Control Classification
Number (ECCN) of Capacitors is 3A201.
Figure 2.14 Frequency Changers84
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017. 81 Ibid.
82 Ibid.
83 Regulation (EC) No. 1334/2000, Annex I, 116.
84 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
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Frequency Changers have been used as a component part of testing
electronic equipment85
for civilian purpose or used as a component of driving high-
speed gas centrifuge motors for military purpose.86
Frequency Changers is in Category 3, Product group A “System,
Equipment and Components” and Type of Control 225.87
Then, Export Control
Classification Number (ECCN) of Frequency Changers is 3A225.
2.1.2.5 Category 4 Computers
Figure 2.15 Computer and Related Equipment88
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
85 Ibid.
86 Ibid. 87 Regulation (EC) No. 1334/2000, Annex I, 122.
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Computers and Related Equipment have been used as a component part of
vehicles or other equipment89
for civilian purpose or used as a component part of
vehicles or weapons for military purpose.90
Computer and Related Equipment is in Category 4, Product group A
“System, Equipment and Components” and Type of Control 001.91
Then, Export
Control Classification Number (ECCN) of Computer and Related Equipment is
4A001.
2.1.2.6 Category 5 Telecommunications and
“Information Security”
88 Narong Nanthavichit, ‘Hardware and Solfware: Mainboard’, 1 April 2004.
< http://www.brr.ac.th/oldweb/knowledge/hardware/mainboard/images/boardatx.jpg > accessed
17 June 2017.
89 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 6.
90 Ibid.
91 Regulation (EC) No. 1334/2000, Annex I, 130.
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Figure 2.16 Optical Fiber Communication Cables92
Optical Fiber Communication Cables have been used as a component part
of telecommunication system93
for civilian purpose or used as a component part of
telecommunication systems for military purpose.94
Optical Fiber Communication Cables is in Category 5, Product group A
“System, Equipment and Components” and Type of Control 001.95
Then, Export
Control Classification Number (ECCN) of Optical Fiber Communication Cables is
5A001.
2.1.2.7 Category 6 Sensors and Lasers
Figure 2.17 Sensors96
92 Claire Swedberg, ‘Copper Vs. Fiber’ [Electrical Contractor] April 2013.
< http://www.ecmag.com/section/systems/copper-vs-fiber > accessed 20 June 2017.
93 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Items’ (2013) [Thailand Board of
Investment] 7.
94 Ibid.
95 Regulation (EC) No. 1334/2000, Annex I, 138.
96 Tenco Technology, ‘Working Principle of Optical Sensor’ 22 Oct 2016.
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Sensors have been used as a component part of camera, magnetometers97
and car for civilian purpose or used as a component of weapons or arms for military
purpose.98
Optical Sensors is in Category 6, Product group A “System, Equipment
and Components” and Type of Control 002.99
Then, Export Control Classification
Number (ECCN) of Optical Sensors is 6A002.
2.1.2.8 Category 7 Navigation and Avionics
Figure 2.18 Navigator100
< http://www.tenco-tech.com/article.php?id=89 > accessed 20 1June 2017. 97 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
98 Ibid.
99 Regulation (EC) No. 1334/2000, Annex I, 152.
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Navigators have been used as a component part of satellite navigation
system, electronic streak cameras or flight control system and guidance sets101
both
for civilian or military purposes.
Global Navigation Satellite System is in Category 7, Product group A
“System, Equipment and Components” and Type of Control 005.102
Then, Export
Control Classification Number (ECCN) of Global Navigation Satellite System is
7A005.
Figure 2.19 Accelerometers103
100 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
101 Ibid.
102 Regulation (EC) No. 1334/2000, Annex I, 182.
103 National Nuclear Security Administration, Department of Energy of United States of America,
‘International Nonproliferation Export Control Program: Control Lists and Approaches’. < https://csis-
prod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_LodenPresentation.pdf >
accessed 17 June 2017.
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Accelerometers have been used as a component part of car airbag
deployment, vibration monitoring or laptops104
for civilian purpose or used as function
switch or tracking position during flight which is a component of Missile for military
purpose.105
Accelerometers is in Category 7, Product group A “System, Equipment
and Components” and Type of Control 001 and 101.106
Then, Export Control
Classification Number (ECCN) of Accelerometers is 7A001 and 7A101.107
2.1.2.9 Category 8 Marine
Figure 2.20 Robot Designed for Underwater Use108
104 Ibid.
105 Ibid.
106 Regulation (EC) No. 1334/2000, Annex I, 180 and 183.
107 Ibid. 108 David Murphy, ‘Deep Sea Coral Reefs More Accessible with Touch-Sensitive Underwater Robotic
Platform’ March 2015. < https://www.kaust.edu.sa/en/news/robotic-diver-expands-underwater-research
> accessed 15 June 2017.
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"Robots" designed for underwater use have been used in researching or
survey activities such as monitoring environmental damages109
, geographical survey
of deep sea and mapping for civilian purpose or used for survey or tracking position
such as underwater de-mining, search and rescue operation for military purpose.110
"Robots" designed for underwater use is in Category 8, Product group A
“System, Equipment and Components” and Type of Control 002.111
Then, Export
Control Classification Number (ECCN) of "Robots" designed for underwater use is
8A002.112
2.1.2.10 Category 9 Aerospace and Propulsion
Figure 2.21 Unmanned Aerial Vehicles (UAVs)113
109 Allison Barrie, ‘Robots Battle for Underwater Supremacy’ [Daily News] 26 July 2013.
< www.military.com/daily-news/2013/07/26/robots-battle-for-underwater-supremacy.html > accessed
20 June 2017.
110 Ibid.
111 Regulation (EC) No. 1334/2000, Annex I, 194.
112 Ibid. 113 Skyline UAV, ‘RMAX UAV Helicopter’
< http://www.skylineuav.com.au/fleet/yamaha-rmax-uav-helicopter/ > accessed 10 June 2017.
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UAVs have been used in agricultural industry such as spraying, seeding,
frost mitigation and variable rate dispersal etc.114
, in other industry such as aerial
photography, mapping, aerial survey and geographical survey115
for civilian purpose
or used for surveillance, target acquisition and reconnaissance for military purpose.116
UAVs is in Category 9, Product group A “System, Equipment and
Components” and Type of Control 012.117
Then, Export Control Classification
Number (ECCN) of UAVs is 9A012.118
2.1.3 Activities Subjected to Control
Export control of DUI is expanded to cover the following activities.
2.1.3.1 Export
114 Yamaha Motor Australia, Yamaha RMAX Type II G/ Type II: Agricultural Use’
< http://rmax.yamaha-motor.com.au/agricultural-use > accessed 19 June 2017.
115 Yamaha Motor Australia, ‘Yamaha RMAX Type II G/ Type II: Industrial Use’
< http://rmax.yamaha-motor.com.au/industrial-use > accessed 19 June 2017.
116 Gheorghe Udeanu, Alexandra Dobrescu and Mihaela Oltean, ‘Unmanned Aerial Vehicle in Military
Operations’, [Scientific Research and Education in the Air Force-AFASES 2016]
< http://www.afahc.ro/ro/afases/2016/RP/UDEANU_DOBRESCU_OLTEAN.pdf > accessed 19 June
2017.
117 Regulation (EC) No. 1334/2000, Annex I, 201.
118 Ibid.
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Export means the transfer of goods or items from the exportation state to
other state.119
2.1.3.2 Re-Export
Re-Export means the export of goods or items that has been imported into
the state.120
2.1.3.3 Transit
Transit means the transport of goods or items through the state from the
port or place of entry to the port or place of exit, whereby the beginning and ending
points of transportation are outside the state, regardless whether there is any
transshipment, warehousing, changing of container or made of transportation
involved.121
2.1.3.4 Transshipment
Transshipment means transshipment of goods or items from one mode of
transport to another within the same port or place such as ship to ship or airplane to
airplane, where the points of origin and destination are outside the state.122
2.1.3.5 Brokerage
Brokerage means negotiation or arrangement of deals involving the
transfer of items between third states.123
119 Anna Wetter, Enforcing European Union Law on Exports of Dual-Use Goods (1st edn, Oxford
University Press 2009) Glossary.
120 Ibid.
121 Department of Foreign Trade, Ministry of Commerce, Thailand.
122 Ibid.
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2.1.3.6 Technology Transfer
Technology Transfer means of transfer technology whether it is tangible or
intangible technology from the exportation state to other state or from the resident to
non-resident.
Therefore, any person who would like to conduct activities mentioned
namely export, re-export, transit, transshipment, brokerage or transfer of technology
concerning DUI are controlled under the DUI export control laws and required to
obtain permission in compliance with the export measures prior to conduct of such
activities.
2.1.4 The Importance of Penalties for Violation
To prevent illegal exports of DUI and the increase of WMD,
administrative sanctions and criminal penalties such as prohibition of export, fine and
imprisonment especially heavy fines and long prison sentences should be applied to
the violation of DUI export control laws. Any person who is engaged in the controlled
activities; in violation of such export control laws is subject to penalties because there
sanctions or penalties could stop the violator from similar offences in order to protect
the general public. Moreover, If the violator is a member of terrorism organization,
the conviction could also obstruct other illegal activities of terrorists.
Moreover, UNSC Resolution 1540 dictates all members of the United
Nations to formulate proper laws to control export, re-export, transit, transshipment
and to establish proper control system of funds and services related to the activities
mentioned above as well as to apply proper criminal penalties or administrative
sanctions for violation of such control measures.124
Based on aforesaid reasons,
appropriate penalties or sanctions applied to the violation of export control of DUI are
very important.
123 Anna Wetter, Enforcing European Union Law on Exports of Dual-Use Goods (1st edn, Oxford
University Press 2009) Glossary.
124 United Nation Security Council Resolution 1540 (2004), Art 3.
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2.2 International Laws on Export Control of Dual-Use Items
Currently, goods, technology and software which are classified as DUI are
used not only for civilian applications but also for military purposes. Therefore, the
increase of growth of international trade on DUI will increase the risks that such DUI
will be used to develop WMD or other illegal activities.
In preventing the proliferation of WMD, there is international cooperation
on non-proliferation and export control system of DUI as follows.
2.2.1 The International Non-Proliferation Agreement
After the Cold War, international non-proliferation agreements went
through improvement and reinforcement in order to maintain security and stability of
global community. There are three major international non-proliferation agreements
namely,
1) Treaty on the Non-Proliferation of Nuclear Weapons (NPT)
2) Biological Weapons Convention
3) Chemical Weapons Convention
2.2.1.1 Treaty on the Non-Proliferation of Nuclear Weapons
(NPT)
The objective of NPT is to promote non-proliferation and disarmament of
nuclear weapons together with peaceful uses of nuclear energy.125
This Treaty was
adopted in 1968 and entered into force in 1970. Total of 191 states have joined the
Treaty including the five nuclear-weapon States126
i.e. the United States, Russia,
China, France and the United Kingdom.127
Thus, the Treaty establishes a safeguard
125
United State Delegation to the 2010 Nuclear Nonproliferation Treaty Review Conference, ‘Treaty
on the Non-Proliferation of Nuclear Weapons’ <http://www.state.gov/documents/organization/141503.pdf> accessed 18 Nov 2016.
126 United Nations Office for Disarmament Affairs, ‘Treaty on the Non-Proliferation of Nuclear
Weapons (NPT)’ <https://www.un.org/disarmament/wmd/nuclear/npt/> accessed 18 Nov 2016.
127Arms Control Association, ‘The Nuclear Nonproliferation Treaty (NPT) at a Glance’
<https://www.armscontrol.org/factsheets/nptfact> accessed 15 July 2017.
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system to prevent the use of fissile material for weapons. This safeguard system is
under the responsibility of the International Atomic Energy Agency (IAEA) the uses
of nuclear energy for the peaceful purposes. Under the safeguard system, there are an
international organization taking change of inspections conducted by IAEA to verify
the compliance with this Treaty.128
2.2.1.2 Biological Weapons Convention (BWC)
BWC is the first multilateral disarmament treaty which prohibits the
development, production and stockpiling of WMD especially biological and toxin
weapons.129
This Convention was adopted in 1972 and entered into force in 1975.
Total of 175 states has joined the Treaty.130
Under this Convention, the state parties warrant to provide annual reports
by using standard agreed templates comprising the required information such as
specific activities related to BWC that have to include information of research center
and laboratory, vaccine production, national biological defense research and
development programs, the affirmation of past activities in offensive and/or defensive
biological research and development programs, information on outbreaks of infectious
toxin and diseases including similar toxin occurrences, information of legislation,
regulation and others etc.131
2.2.1.3 The Chemical Weapons Convention (CWC)
128 Ibid.
129 United Nations Office for Disarmament Affairs, ‘Biological Weapons: The Biological Weapons
Convention’ <https://www.un.org/disarmament/wmd/bio/> accessed 18 Nov 2016.
130 Arms Control Association, ‘Biological Weapons Convention Signatories and States-Parties’ 25 July
2016 <http://www.armscontrol.org/factsheets/bwcsig> accessed 18 Nov 2016.
131 United Nations Office for Disarmament Affairs, ‘Biological Weapons: The Biological Weapons
Convention’ <https://www.un.org/disarmament/wmd/bio/> accessed 18 Nov 2016.
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CWC is the multilateral disarmament treaty which prohibits the
development, production, stockpiling, transfer or use of WMD especially chemical
weapons.132
This Convention was adopted in 1992133
and entered into force in 1997.
Total of 192 states has joined the Convention.134
Under this Convention, the
Organization for Prohibition of Chemical Weapons (OPCW) has been established to
encourage the peaceful use of chemistry together with to ensure and to verify the
destruction of chemical weapons under CWC.
According to the Convention, all state parties agree to disarm chemical
weapon by eliminating and destroying the stockpiles of such weapons. The chemistry
will be used only for the benefit of mankind.135
The unique provision of the CWC concerns the challenge of inspection in
the case that a state party doubt about compliance with this Convention by another
state party. Such state party which is the accuser could request the Director-General of
the OPCW to send an inspection team to inspect the suspected state based on the
CWC's challenge inspection procedures according to which all state parties commit
themselves to this inspection under rule 'anytime, anywhere' with no right to refuse
such inspection.136
2.2.2 United Nations Security Council Resolution 1540
132 United Nations Office for Disarmament Affairs, ‘Chemical Weapons’
<https://www.un.org/disarmament/wmd/chemical/> accessed 18 Nov 2016.
133 Ibid.
134 Arms Control Association, ‘Chemical Weapons Convention Signatories and States-Parties’
<https://www.armscontrol.org/factsheets/cwcsig> accessed 18 Nov 2016.
135 United State Department of State, ‘Convention on the Prohibition of the Development, Production,
Stockpiling and Use of Chemical Weapons and on Their Destruction (CWC)’
<https://www.state.gov/t/avc/trty/127917.htm> accessed 18 Nov 2016. 136 Ibid.
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The increase of WMD such as nuclear, chemical and biological weapons is
the obstruction to the maintenance of international peace and security. There are the
potentials that terrorists may possess, acquire, develop or use such WMD for
terrorism activities. Thus, UNSC Resolution 1540 was adopted on April 28, 2004
under Chapter VII of the United Nations Charter in order to affirm that the increase of
WMD as well as the means of delivery is the threat to international peace and security
and thus dictates the members of the United Nations to take proper and effective
actions against such threat and to fulfil all other obligations related to arms control
and disarmament for the prevention of the proliferation of WMD in all aspects.137
This Resolution lays down obligations for all members of the United
Nations to take steps decided by itself to prevent the increase of WMD and the means
of delivery by requiring prohibition of non-state actors to obtain, possess, apply,
manufacture, develop and transfer of WMD and related materials for terrorism
purposes138
as follows.
1) To refrain from providing any support to any individual or entity that
tries to develop, acquire, produce, possess, deliver, transfer, apply or
use WMD or related materials;
2) To establish and execute proper and efficient laws which prohibit any
individual or entity to develop, acquire, produce, possess, deliver,
transfer, apply or use WMD or related materials;
3) To establish and execute efficient measures for national control to
prevent the proliferation of WMD and related materials such as
safeguard of DUI in production, storage, transport, transfer or use; and
to legislation of proper national laws used for trade management on
export, re-export, transshipment, transit, brokering and transfer of
technology that may contribute to proliferation of WMD;
4) To establish cooperation to eliminate illegal trafficking of WMD and
related materials.
137 United Nation Security Council Resolution 1540 (2004) 1.
138 Ibid, 3-4.
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Likewise, this Resolution affirms that members of the United Nations have
obligations to support and strengthen the multilateral treaty the objective of which is
to eliminate or prevent proliferation of WMD by establishing national laws and
regulations in compliance with the commitment under such multilateral non-
proliferation treaties.139
For legal status of United Nations Security Council Resolution, the power
of United Nations Security Council to pass resolution is provided for in Article 24 of
the United Nations Charter140
. Then, the members of United Nations bound by Article
25141
and 48142
to implement obligations under United Nations Security Council
Resolution 1540.
2.2.3 The Multilateral Export Control Regimes
The multilateral export control regime is the voluntary groups of supplier
states that have the objectives to restrict the trade on controlled items including DUI
only for peaceful proposes. Under each regime, the members have the commitments
to ensure that their activities shall not contribute to proliferation of WMD. Thus, there
are guidelines and controlled items that will balance the trade and the security of
global community. However, such guidelines and controlled items will be
implemented only by the legislation of national export control laws of each state.
2.2.3.1 Nuclear Suppliers Group (NSG)
139 Ibid, 1-4.
140 The Charter of United Nations, Article 24.
“In order to ensure prompt and effective action by the United Nations, its Members confer on the Security Council primary responsibility for the maintenance of international peace and security, and
agree that in carrying out its duties under this responsibility the Security Council acts on their behalf.”
141 Ibid, Article 25.
“The Members of the United Nations agree to accept and carry out the decisions of the Security
Council in accordance with the present Charter.”
142 Ibid, Article 48. “1. The action required to carry out the decisions of the Security Council for the maintenance of
international peace and security shall be taken by all the Members of the United Nations or by some of
them, as the Security Council may determine.
2. Such decisions shall be carried out by the Members of the United Nations directly and through
their action in the appropriate international agencies of which they are members.”
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The Nuclear Suppliers Group (NSG) is a cooperation of nuclear exporters
which is a voluntary association founded in 1975 that has no formal measures to
enforce all members on the compliance. Currently, there are 48 members.143
All
members are seeking to contribute to non-proliferation of nuclear by implementing
two guidelines adopted by consensus. The first guideline controls the export of items
designed or used for nuclear purposes and the second controls DUI and related
technology. Both guidelines are consistent with relevant international non-
proliferation agreements. Examples of DUI List of NSG are machine tools, vacuum
pumps, pressure transducers, frequency changers or generators, switching devices and
vibration test systems etc. However, the determinations on export of items are taken
by each state based on national export permission and requires importers to declare
non-proliferation and physical security assurances.144
2.2.3.2 Australia Group (AG)
This cooperation is an informal voluntary export control arrangement
founded in 1985 seeking to ensure that any export does not contribute to the
proliferation of biological and chemical weapons. It sets export guidelines and six
common control lists. The lists are included dual-use chemical manufacturing,
chemical weapons precursors, biological agents and biological equipment.145
Currently, there are 41 members146
which are also the parties to the Chemical
Weapons Convention and the Biological Weapons Convention.
2.2.3.3 Missile Technology Control Regime (MTCR)
This cooperation is a voluntary export control arrangement founded in
1987 having the objective to limit the proliferation of ballistic missile, unmanned
143 Nuclear Treat Initiative, ‘Nuclear Suppliers Group NSG’ 31 January 2017
<http://www.nti.org/learn/treaties-and-regimes/nuclear-suppliers-group-nsg/> accessed 18 Feb 2017.
144 Nuclear Suppliers Group, ‘About The NSG’ <http://www.nuclearsuppliersgroup.org/en/about-us>
accessed 18 Nov 2016.
145 The Australia Group, ‘Home’ < http://www.australiagroup.net/en/index.html> accessed 18 Nov
2016.
146 The Australia Group, ‘Statement by the Chair of the 2015 Australia Group Plenary’ 5 June 2015
< http://www.australiagroup.net/en/agm_june2015.html > accessed 18 Nov 2016.
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delivery systems capable of delivering WMD and other related items that could be
used for WMD attacks. Members of the MTCR have to establish national export
control measures for ballistic missiles and related items that appear on the MTCR.
Under the MTCR, there are two categories of controlled items, Category I
is the most sensitive because it is “a strong presumption to deny” such transfer in
accordance with the MTCR guidelines. It includes complete missiles, rockets and
related items. Category II could be applied for civilian uses which include items to
construct Category I systems and Non-Category I systems.
The members are required to obtain as assurance from the recipient that
such items will be used only for the purposes declared in the dealing time and will not
transfer the items to a third party without permission. Currently, the member can be
counted to 35.147
2.2.3.4 Wassenaar Arrangement (WA)
This arrangement calls for cooperation of export control system which was
established in 1996 to contribute to the international security concerning the transfer
of conventional arms, DUI and technologies and also to prevent the use of such items
by terrorists. WA is the first system of multilateral export control designed to cover
both conventional weapons and sensitive dual-use items. All parties agree that items
on a Munitions List and List of DUI and Technologies shall be controlled in order to
prevent unauthorized transfer or re-transfer of such items. Wassenaar Arrangement is
designed for both regional and international security and stability. In order to promote
transparency and responsibility of conventional arms and sensitive DUI the parties
147 The Partners of the Missile Technology Control Regime, ‘Joint Statement agreed by consensus
during the Reinforced Points of Contact 2017 to celebrate the 30th anniversary of the MTCR’ 13 April
2017 < http://mtcr.info/> accessed 18 Nov 2016.
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exchange information concerning transfers and licenses for the items.148
Currently,
Wassenaar Arrangement are consisting of 41 parties.149
148 The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and
Technologies, ‘About Us’ < http://www.wassenaar.org/about-us/> accessed 18 Nov 2016.
149 The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and
Technologies, ‘National Contacts’ < http://www.wassenaar.org/participating-states/> accessed 18 Nov
2016.
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CHAPTER 3
EXPORT CONTROL OF DUAL-USE ITEMS
IN FOREIGN COUNTRIES
As mentioned in the previous Chapter, all members of the United Nations
are required to establish and implement national legislation and export control system
to prevent any non-state actor to acquire, possess, develop, manufacture, transport,
transfer or use WMD and their means of delivery to comply with the UNSC
Resolution 1540.150
Thus, DUI which are goods, software and technology that can be
used for producing, developing or using in missile, nuclear, chemical or biological
weapons will be focused and controlled under national export control laws of each
member.
This Chapter will focus on national export control laws of certain dual-use
items of Asian countries namely Japan (the world’s third largest economy151
),
Singapore and Malaysia (the two Asean members with export control law of dual-use
items in place) that are the members of United Nations and bound by Articles 25 and
48 of the Charter of the United Nations to implement obligations under UNSC
Resolution 1540.
The reasons why Japan, Malaysia and Singapore are chosen in this chapter
are as following.
1) Japan, Singapore and Malaysia are the members of United Nations and
thus are bound by. Then, the UN Security Council Resolution 1540 (2004) adopted by
the Security Council on 28 April 2004 under the Chapter VII of Charter of the United
Nations. In response to the United Nations Security Council’s decisions, Article 25 of
the Charter of the United Nations requires the members of the United Nations to
accept and carry out the decisions of the Security Council in accordance with the
150 United Nations Security Council Resolution 1540, Art 3 (d).
151 BBC News, ‘Japan Country Profile’ <http://www.bbc.com/news/world-asia-pacific-14918801>
accessed 18 May 2017.
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Charter of the United Nations.152
Specifically, Article 48 of the Charter requires the
members of United Nations to carry out the decisions of the Security Council for
maintaining international peace and security.153
Therefore, Japan, Singapore and
Malaysia as the members of the United Nations are obligated to accept and carry out
the Security Council’s decisions including Security Council Resolutions 1540 (2004)
by establishing its national export control measures with an aim to prevent the
proliferation of WMD or any related materials and to enforce such export control laws
over DUI in the same manner as Thailand does.
2) For Japan, the third largest economy of the world154
, its export control
system was established since 1949,155
which is considered a long time for the
establishment and implementation of export control law and regulations. Furthermore,
Toyota, Honda, Nissan, Suzuki and Mazda, the famous Japanese companies in
automobile industries, are in top fifteen of largest global automobile companies in the
world156
that possess the component parts namely analogue to digital converter used
for GPS system, capacitor, accelerometer used for car airbag deployment, sensor,
engine, motor, and valve which are dual-use items under export control laws and the
export, re-export, transit, transshipment, brokering and technology transfer of such
parts are controlled by export control law of Japan and the laws of other countries
which adopted UNSC Resolution 1540. Therefore, use of such dual-use items
manufactured or sold from a Japanese company will affect the reputation of Japan and
152 The Charter of United Nations, Article 25. “The Members of the United Nations agree to accept and carry out the decisions of the Security
Council in accordance with the present Charter.”
153 Ibid, Article 48.
“1. The action required to carry out the decisions of the Security Council for the maintenance of
international peace and security shall be taken by all the Members of the United Nations or by some of
them, as the Security Council may determine.
2. Such decisions shall be carried out by the Members of the United Nations directly and through their
action in the appropriate international agencies of which they are members.”
154 BBC News, ‘Japan Country Profile’ <http://www.bbc.com/news/world-asia-pacific-14918801>
accessed 18 May 2017.
155 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 1. <http://www.cistec.or.jp/english/export/Overview4th.pdf> accessed 18 June 2016.
156 Worldatlas, ‘The World’s Biggest Automobile Companies: Volkswagen, Toyota, and Hyundai are
the three leading passenger car manufacturers in the world.’ <
http://www.worldatlas.com/articles/which-are-the-world-s-biggest-automobile-companies.html >
accessed 12 June 2017.
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will be sanctioned by non-tariff barrier from other countries. For these reasons,
government agencies of Japan are using their best efforts to develop their export
control system for activities subject to control to prevent proliferation of WMD in
compliance with UNSC Resolution 1540. Moreover, Japanese investors have played
significant roles in Thai manufacturing and trading businesses157
because they are the
top foreign investors in Thailand especially in automotive and electronic industries158
Thailand is used by such Japanese investors as a global manufacturing base and
contain component parts of products can be used for both civilian and military
applications such as analogue to digital converter used for GPS system, capacitor,
accelerometer used for car airbag deployment, sensor, engine, motor, and valve etc.
Thus, such Japanese companies are required to comply with Japanese Law of dual-use
items in this matter even though they are established outside Japan bases on Japanese
nationality of such companies. This expresses the efficient enforcement of export
control law on dual-use items of Japan.
3) Singapore, the leader of Regional Operating Headquarters159
and trading
hub160
in Asean, has established its export control of dual-use items since 2002 based
on the mindfulness of impact on locally business and economy.161
If Thailand would
like to become international trading headquarters in Asean,162
Singapore will be the
major competitor. Thus, the government of Thailand should study the export control
law of Singapore for comparison.
157
Peter Burke and Nattha Srisomwong, ‘The Japanese Oversea Investment Report: Thailand’
(International Financial Law Review) 29 March 2017 <http://www.iflr.com/Article/3673595/The-
Japanese-Overseas-Investment-Report-2017-Thailand.html> accessed 12 June 2017.
158 Board of Investment of Thailand, ‘Statistics of Oversea Investment: Monthly in 2016 (January –
September) <http://www.boi.go.th/upload/summarize_1609_47177.pdf> accessed 12 June 2017.
159 Centennial Asia, ‘Move to make Thailand Asean trade hub’ 18 November 2014
< http://www.centennialasia.com/move-to-make-thailand-asean-trade-hub-18-november-2014/ >
accessed 1 June 2017
160 Supanee Phupisut, ‘Move To Make Thailand Asian Trade Hub’ (The Nation) 18 November 2014
< http://www.nationmultimedia.com/news/business/EconomyAndTourism/30247967 >
161 George Tan, ‘Singapore’s Journey Towards Its Implementation of Strategic Trade Controls’
< http://www.str.ulg.ac.be/wp-content/uploads/2016/03/6.-Singapore%E2%80%99s-Journey-Towards-
its-Implementation-of-Strategic-Trade-Controls.pdf > accessed 1 June 2017.
162 Patricia Mongkhonvanit, ‘International Headquarters & International Trading Center: Scope of
business and special tax measures for IHQ and ITC’
<http://www.boi.go.th/upload/content/02%20International%20headquarter%20and%20international%2
0trading%20center%20(English%20Version)_90051.pdf > accessed 1 June 2017.
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4) Malaysia, the 2nd
of Regional Operating Headquarters and automotive
industry is 3rd
in Asean,163
always competes with Thailand in trading hub and
automotive industry in Asean. Thus, it will be the advantageous point if the
government of Thailand will consider the export control law of dual-use items of
Malaysia to develop Thai export control system to facilitate trade and investment and
to prevent proliferation of WMD.
From the reasons mentioned above, it is necessary for Thailand to study
and compare the export control laws of dual-use items of Japan, Singapore and
Malaysia for benchmarking best practice to develop national export control system.
3.1 Japan
Japan is a member of the United Nations and a party to all multilateral
non-proliferation treaties (NPT, BWC, CWC) and regimes (NSG, AG, MTCR,
WA).164
Under UNSC Resolution 1540 that requires the member states to establish
national control to prevent proliferation of nuclear, chemical, or biological weapons
that could be called “WMD” including their means of delivery and related materials165
which include DUI, Japan as a UN member has the obligations to comply with
Articles 25166
and 48167
of the Charter of UN. However, Japan has enacted national
163 Sunetra Chantaburi, ‘Automotive Industry: Thailand has highest capability in Asean’
<http://www.aseanthai.net/mobile_detail.php?cid=4&nid=5720> accessed 12 June 2017.
164 Yann Aubin and Arnaud Idiart, Export Control Law and Regulations Handbook: A Practical Guide
to Military and Dual-Use Goods, Trade Restrictions and Compliance (Kluwer Law International,
2007).
165 United Nation Security Council Resolution 1540 (2004), Art 3.
166 Charter of United Nations, Art 25. “The Members of the United Nations agree to accept and carry out the decisions of the Security
Council in accordance with the present Charter.”
167 Charter of United Nations, Art 48.
“1. The action required to carry out the decisions of the Security Council for the maintenance of
international peace and security shall be taken by all the Members of the United Nations or by some of
them, as the Security Council may determine.
2. Such decisions shall be carried out by the Members of the United Nations directly and through
their action in the appropriate international agencies of which they are members.”
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export control laws calles “the Foreign Exchange and Foreign Trade Control Act”
since 1949.
3.1.1 Laws and Regulations
The export control system of Japan is complicated. Legal framework of
Japan is considered to be based on the Foreign Exchange and Foreign Trade Act.
Pursuant to this Act, there are subordinate legislations namely Export Control Order
and Foreign Exchange Order issued by the Cabinet known as Cabinet Orders.
3.1.1.1 Foreign Exchange and Foreign Trade Act (1998)
This Act is enacted for the first time in 1949 after World War II providing
legal framework for controlling foreign exchange and foreign trade transactions.
Currently, this Act applies only to control of weapons and dual-use items. Thus, any
person who intends to export the goods168
or transfer technology169
specified by
Cabinet Order to a foreign country or a foreign person must obtain permission from
the Ministry of Economy, Trade and Industry of Japan (METI).
Although dual-use items specified in the Control List are exported or
transferred to the subsidiaries outside Japan by Japanese resident, such resident as an
exporter is likewise required to obtain permission from the METI under this Act.170
3.1.1.2 Cabinet Orders
3.1.1.2.1 The Export Control Order issued by the Cabinet
under Article 48 of Foreign Exchange and Foreign Trade Act is designed to
make the control list of goods.171
168 The Foreign Exchange and Foreign Trade Act, art 48.
169 Ibid, art 25.
170 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016.
171 Ibid, art 48 (1)
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3.1.1.2.2 The Foreign Exchange Order issued by the Cabinet
under Article 25 of Foreign Exchange and Foreign Trade Act is designed to
make the control list of technologies.
3.1.1.3 Ministerial Order
Other than Export Control Order and Foreign Exchange Order issued by
the Cabinet, there are the Ministerial Order specifying the specification and
interpretations of the controlled goods and technologies such as the Ordinance of the
Ministry of Economy, Trade and Industry and Ordinance of the Ministry of Finance.
3.1.2 Transaction Subject to Control
Under the Foreign Exchange and Foreign Trade Act, transactions subject
to control are export and re-export of goods172
, transfer of technologies173
,
transshipment of goods and brokering transactions related to goods or technologies.174
However, transit of goods is not defined and is not covered within the
scope of such Act.
3.1.3 Classification of Controlled Items
Under the export control laws of Japan, controlled items are separated as
List Control and Catch-All Control.
3.1.3.1 List Control
List Control of Japan is consistent with the list specified by international
regimes (NSG, AG, MTCR, WA)175
; but, classification number of each item under
this List are specified by Japan and are not similar to that of the other countries.176
172 Ibid, art 48.
173 Ibid, art 25.
174 <http://www.meti.go.jp/policy/anpo/securityexportcontrol3.html> accessed 10 June 2016.
175 Toshikazu Okuya, ‘Importance of Export Control & Japan’s Export Control’, 2016.
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Under the export control system of Japan, goods or technology that are
specified in List Control have are required to obtain the export license prior to export
to foreign countries.177
As mentioned above, the export of goods or transfer of technology under
list control to subsidiaries located in foreign countries are also required to comply
with export license measures of Japan.178
Under List Control, many items including components and parts that are
subject to apply for export license are controlled by multiple categories and such List
is updated once a year.179
Then, an exporter needs to follow up the revision of List
Control.
Table 3.1 List Control of Japan180
Category Japanese Classification181
International Regime
1 Military
Items Arms WA/ Munitions
2
Dual-Use Items
Nuclear Items NSG
3 Chemical Weapons AG
3-2 Biological Weapons AG
4 Missiles MTCR
5 Advanced Materials WA Cat. 1
6 Material Processing WA Cat. 2
7 Electronics WA Cat. 3
8 Computers WA Cat. 4
9 Communication/ Information Security WA Cat. 5
10 Sensors and Lasers WA Cat. 6
11 Navigation/ Avionics WA Cat. 7
12 Marine WA Cat. 8
13 Aerospace/ Propulsion WA Cat. 9
14 Other ML Items Except for WA/ Munitions
176 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015)
177 Export Trade Control Order, Art 1. 178 Toshikazu Okuya, ‘Importance of Export Control & Japan’s Export Control’, 2016. 179 Ibid, 21. 180 Center for Information on Security Trade Control of Japan, ‘Overview of Japan’s Export Control
(4th edn’, 2015) 181 Ibid, 11.
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15 Sensitive Items WA very sensitive
3.1.3.2 Catch-all Control
Although the export items are not specified in the List Control, exporter
has the obligation to apply for an export license based on the following criteria.182
1) Such items will be applied for development of WMD.
2) End-user of such items may be related to the proliferation of WMD or is
specified in the Foreign End-User List.183
3) METI has the authority to consider that the export items could apply for
design, manufacturing, developing or using of WMD and to require an exporter to
apply for the export license.
Catch-all Control of WMD, however, is not apply to 27 white countries
namely Argentina, Australia, Austria, Belgium, Bulgaria, Canada, Czech Republic,
Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, South Korea,
Luxemburg, Netherlands, New Zealand, Norway, Poland, Portugal, Spain, Sweden,
Switzerland, United Kingdom and United States of America.184
White countries here refer to those which mentioned above.
Table 3.2 Catch-all Control List of Japan185
Category Japanese Classification International Regime
16 Catch-all
Control
Items other than Categories
1-15 as mentioned above. -
3.1.3.3 Technology Transfer Control
182 Center for Information on Security Trade Control of Japan, Overview of Japan Export Control Legal
Framework, 2010.
183 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016.
184 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 14.
185 Ibid, 13.
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The controlled list of technologies is under the Foreign Exchange Order
issued by the Cabinet under Article 25 of Foreign Exchange and Foreign Trade Act
that are separated into three cases as follows.
3.1.3.3.1 Technology Transfer from Japan to
Foreign Company
In Japan, any person who would like to transfer technology specified in the
controlled List from Japan to other countries is required to obtain permission.
However, such permission is not applied in the case that the person would like to use
such technologies by himself in other countries.186
3.1.3.3.2 Technology Transfer within Japan
In the case that a person who is a resident of Japan would like to transfer
technologies controlled by the List under the Foreign Exchange Order to a non-
resident in Japan, the resident is also required to obtain the permission.187
3.1.3.3.3 Technology Transfer in Foreign Country
In the case that the person who is a resident of Japan would like to transfer
technologies controlled by the List under the Foreign Exchange Order to a non-
resident in foreign countries, the resident is required to obtain
permission.188
Nevertheless, such permission is not applied to a case where such
technology originates outside Japan and its transactions are accomplished outside
Japan.189
3.1.3.4 Special Control for Restricted Country
186 The Foreign Exchange and Foreign Trade Act, Art 25.
187 Ibid.
188 Ibid.
189 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 12-13.
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For export control system, there are some restricted countries to which the
government of Japan decides to prohibit exportation of dual-use items such as Iran,
North Korea and Russia.
3.1.4 Permission
In Japan, export permission will be issued by the Minister of Economy,
Trade and Industry (METI), if METI considers that the export items do not contribute
to the proliferation of WMD.190
For such permissions, there are two categories of
export license of dual-use items.
3.1.4.1 Individual Permission
For individual permission under export control law of Japan called
“Individual Export License”, an exporter will apply for this License based on each
transaction. 191
In case that the export is required to obtain the permission based on
Catch-all Control, this License will be applied. The validity of this License, is six
months after the date of issuance for export period.192
3.1.4.2 Bulk Permission
Permission for multiple exports of dual-use items in Japan called “Bulk
Export License”, allows an exporter who obtains such License to expert dual-use
items under the conditions of permission193
such as destination of exportation, end-use
and end-user.
190 Center for Information on Security Trade Control of Japan, Overview of Japan Export Control Legal Framework, 2010.
191 Ibid.
192 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 23.
193 Center for Information on Security Trade Control of Japan, Overview of Japan Export Control Legal
Framework, 2010.
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Bulk Export License will be issued in the case that an exporter has the
good internal control system that are considered in compliance with the requirements
of Internal Compliance Program (ICP) of METI.
Currently, Bulk Export License is classified into five types194
and the
validity of each type of Bulk Export License is different as follows.
3.1.4.2.1 General Bulk Export License195
or Bulk License
for White Countries196
An exporter who obtains this License could export specific dual-use items
to 27 white countries namely Argentina, Australia, Austria, Belgium, Bulgaria,
Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary,
Ireland, Italy, South Korea, Luxemburg, Netherlands, New Zealand, Norway, Poland,
Portugal, Spain, Sweden, Switzerland, United Kingdom and United States of
America.197
The validity of this License is 3 years after the date of issuance.198
3.1.4.2.2 Special General Bulk Export License199
or
Bulk License for Combination of Items and
Destination200
An exporter who obtains this License could export specific dual-use items
to foreign countries other than white countries. However, the exporter is prohibited to
export such dual-goods items to the restricted countries. The validity of this License is
3 years after the date of issuance.201
194 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 25-26. 195 Ibid. 196 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016. 197 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 14. 198 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016. 199 Ibid, 25. 200 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016. 201 Ibid.
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3.1.4.2.3 Special Bulk Export License202
or Bulk License for
the Same Customer203
An exporter who obtains this License could export specific dual-use items
to a specific customer who is a business partner repeated. The validity of this License
is 2 years after the date of issuance.204
3.1.4.2.4 Special Bulk Export License for Repair and
Replacement205
An exporter who obtains this License could re-export specific dual-use
items to a specific customer in order to return such items to the country of exportation
for repair or replacement.206
The validity of this License is 2 years after the date of
issuance.207
3.1.4.2.5 Special Bulk Export License for
Oversea Subsidiaries208
An exporter who is a manufacturer and obtains this License could export
specific dual-use items to subsidiaries in foreign countries repeatedly.209
The validity
of this License is 3 years after the date of issuance.210
202 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 25.
203 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016.
204 Ibid.
205 Center for Information on Security Trade Control of Japan, Overview of Japan Export Control Legal
Framework, 2010.
206 Ibid.
207 Ibid.
208 Ibid.
209 Toshikazu Okuya, Importance of Export Control & Japan’s Export Control, 2016.
210 Center for Information on Security Trade Control of Japan, Overview of Japan Export Control Legal
Framework, 2010.
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3.1.5 Offence, Penalty and Sanction
An Exporter who violates export control laws of Japan is subject to penalty
based on each offense.
3.1.5.1 Offence and Penalty
3.1.5.1.1 Export or Brokerage of Goods or Technologies
Related to WMD without Permission
A violator shall be punished by imprisonment not exceeding 10 years or
fine not exceeding 10,000,000 Yen, or both; but, in case that the five times of price of
export items more than 10,000,000 Yen, such fine shall be up to five times of the
price of such items.211
3.1.5.1.2 Export or Brokerage of Goods or Technologies
Related to Convention Arms without Permission
A violator shall be punished by imprisonment not exceeding 7 years or
fine not exceeding 7,000,000 Yen, or both; but, in case that the five times of price of
export items more than 7,000,000 Yen, such fine shall be up to five times of the price
of such items.212
3.1.5.1.3 Transfer Technologies without Permission
A violator shall be punished by imprisonment not exceeding 5 years or
fine not exceeding 5,000,000 Yen, or both; but, in case that the five times of price of
export items more than 5,000,000 Yen, such fine shall be up to five times of the price
of export items.213
211 Foreign Exchange and Foreign Trade Act, art 69-6 (2).
212 Foreign Exchange and Foreign Trade Act, art 69-6 (1).
213 Foreign Exchange and Foreign Trade Act, art 69-9 (3).
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3.1.5.1.4 Obtain Permission Illegally
A violator shall be punished by imprisonment not exceeding 3 years or
fine not exceeding 1,000,000 Yen, or both; but, in case that the three times of price of
export items more than 1,000,000 Yen, such fine shall be up to three times of the
price of export items.214
3.1.5.1.5 Failure to Comply with The Notification Issued
by the METI
A violator shall be punished by imprisonment not exceeding 6 months or
fine not exceeding 500,000 Yen.215
3.1.5.1.6 Attempted Violation of Export Control Laws
Attempted violation is subject to be punished.
3.1.5.2 Administrative Sanction
For a violation of a petty offense a violator shall be punished by
administrative sanctions which is prohibition of export not more than 3 years.
3.1.5.3 Warning
Certain, the METI has the authority to issue a warning which is served
upon a violator when the violation is not so serious.
3.1.6 Internal Compliance Program (ICP)
The METI has the authority to issue compliance check list to the
companies who have registered ICP. Exporters have to answer questions and provide
214 Foreign Exchange and Foreign Trade Act.
215 Foreign Exchange and Foreign Trade Act.
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self-checking on their export control compliance status.216
Registration of ICPs is one
requirement for obtaining a special bulk license.217
For ICPs, an exporter has to prepare the internal control as follows.218
(1) Organization
(a) Corporate export control organization
(b) Role and responsibility of each unit
(2) Control procedures
(a) Item classification
(b) Transaction screening
(c) Shipment control
(3) Operation and maintenance
(a) Internal audit
(b) Training and education
(c) Documents control
(d) Instruction and guidance to subsidiaries
(e) Incident reports and prevention of recurrence
Figure 3.1 Export Control Procedure in Japan219
216
Center for Information on Security Trade Control of Japan, Overview of Japan’s
Export Control (4th edn, 2015) 34.
217 Center for Information on Security Trade Control of Japan, Overview of Japan
Export Control Legal Framework, 2010.
218 Center for Information on Security Trade Control of Japan, Overview of Japan’s
Export Control (4th edn, 2015) 34.
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3.2 Singapore
219 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 44. <http://www.cistec.or.jp/english/export/Overview4th.pdf> accessed 18 June 2016.
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Under the UNSC Resolution 1540 that requires the member states of the
United Nations to establish national control to prevent proliferation of nuclear,
chemical, or biological weapons that could be called “WMD” including their means
of delivery and related materials220
which include DUI, Singapore, as a UN member
has implemented the obligations under Articles 25221
and 48222
of the Charter of the
United Nations by enacting national export control laws following the adoption of
Resolution 1540 called “Strategic Goods (Control) Act” since 2003.223
Currently, there is the strategic goods control system operated under the
Strategic Goods (Control) Act in Singapore.
Strategic Goods refer to goods including software and technology which
have both civilian and military applications, which can be used for development,
production, or use in nuclear, chemical and biological weapons, or missiles capable of
delivering these weapons; and also conventional arms and military equipment.224
3.2.1 Laws and Regulations
For Singapore Export Control System, there are two legislative
frameworks used for controlling the export of dual-use items.
3.2.1.1 Strategic Goods (Control) Act (“SGCA”)
220 United Nation Security Council Resolution 1540 (2004), Art 3.
221 Charter of United Nations, Art 25.
“The Members of the United Nations agree to accept and carry out the decisions of the Security
Council in accordance with the present Charter.”
222 Charter of United Nations, Art 48.
“1. The action required to carry out the decisions of the Security Council for the maintenance of
international peace and security shall be taken by all the Members of the United Nations or by some of them, as the Security Council may determine.
2. Such decisions shall be carried out by the Members of the United Nations directly and through
their action in the appropriate international agencies of which they are members.” 223 Chen Yongquan, ‘Strategic Goods Control: Traders as Our Partners’
224 Singapore Customs, Strategic Goods Control and Self-Compliance.
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This Act specifies all transactions subject to control including Control List
and Catch-all Control, authority and international cooperation.225
3.2.1.2 Strategic Goods (Control) Regulations (“SGCR”)
This Regulations specify the conditions of export permission, revocation
and suspension including requirements of internal control of exporter226
3.2.2 Transactions Subject to Control
Controlled transactions under Singapore laws include export, re-export,
transshipment, bring-in transit, intangible transfer of technology and brokering.227
3.2.3 Classification of Controlled Items
Goods and technology specified in the Strategic Goods Control List
attached to the Strategic Goods (Control) Order 2016 are subject to control under the
Strategic Goods (Control) Act. The Strategic Goods Control includes items from the
four multilateral export control regimes namely AG, MTCR, NSG and WA.228
There are two controlled types under Singapore laws as follows.
3.2.3.1 List Control
List Control of Singapore is prepared on the basis of the export control
lists used by the EU, United States, Australia, Hong Kong and other countries which
applies to all transactions regarding strategic goods which is divided into as two sub
lists as follows.229
3.2.3.1.1 Munition List
225 Singapore Customs, Singapore’s Strategic Goods Control System.
226 Singapore Customs, Strategic Goods Control and Self-Compliance.
227 Singapore Customs, Singapore’s Strategic Goods Control System.
228 Ibid. 229 Ibid
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Munition List of Singapore prepared from the Munitions List of WA that
are goods and technology designed for military purposes.230
3.2.3.1.2 Dual-Use List
Dual-Use List of Singapore prepared on the basis of Dual-Use List of EU
comprising the list of all export control regimes namely MTCR, NSG, AG and WA in
categories 0-9.
3.2.3.2 Catch-all Control
Under the SGCA, “catch-all” covers all goods and technology that are
intended, known or suspected to be used in relation to weapons of mass destruction
(WMD).231
3.2.3.3 Technology Transfer Control
Transfer of intangible technology in Singapore is required to obtain
permission if it is strategic goods, software or technology under Dual-Use List or any
software/technology under Catch-all Control.
3.2.3.4 Special Control for Restricted Countries
As a member of the United Nations, Singapore implements the
Resolutions adopted by the United Nations Security Council in its domestic laws.
Thus, the restricted countries under such Resolution are prohibited for exportation.
3.2.4 Permission
In Singapore, export permission is divided into as two categories as
follows.
3.2.4.1 Individual Export Permission
230 George Tan, Export Controls.
231 Singapore Customs, Singapore’s Strategic Goods Control System.
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Individual Permit must be applied for by exporters who intend to export,
re-export, transship or bring in transit dual-use goods and their related technology and
it will be approved on a transaction – by - transaction basis which means that
individual permit will be approved based on each shipment.232
3.2.4.2 Bulk Export Permission
Bulk Permit is suitable for exporters who usually export dual-use goods to
multiple end users or destination countries and could comply with ICP. Validity of
Bulk Permit is up to three years. Bulk Permission in Singapore Law is divided into
two types as follows.233
3.2.4.2.1 Bulk License for Specific Entities
This License will be approved for multiple products that will be exported
to specific consignees or end-users and applied to export, re-export, transshipment
and intangible transfer of technology.234
3.2.4.2.2 Bulk License for Countries of Destination
This License will be approved for multiple products that will be exported
to specific destination and applied to export, re-export, transshipment and intangible
transfer of technology
3.2.5 Offence, Penalty and Sanction
The penalties and sanctions in the cases of violation of export control of
dual-use items in Singapore are provided for in the Strategic Goods Control Act.
3.2.5.1 Offence and Penalty
232 Singapore Customs, Strategic Goods Control and Self-Compliance (2016).
233 Ibid. 234 Ibid.
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3.2.5.1.1 Misassumption
1) For the first time of violation, a violator shall be punished by fine not
exceeding $100,000 or 3 times of the value of the goods or technology related to the
violation or by imprisonment not exceeding 2 years or by both; or
2) For the second time of violation, the violator shall be punished by fine
not exceeding $200,000 or 4 times of the value of the goods or technology related to
the violation or by imprisonment not exceeding 3 years or by both.
3.2.5.1.2 False Declarations
A violator shall be punished by fine not exceeding $50,000 or by
imprisonment for a term not exceeding 12 months or by both.
3.2.5.1.3 Failure to Comply with Conditions of Permit
A violator shall be punished by fine not exceeding $50,000 or by
imprisonment for a term not exceeding 12 months or by both.
3.2.5.1.4 Refusal or Failure to Keep or Submit Record
A violator shall be punished by fine not exceeding $10,000 or by
imprisonment for a term not exceeding 6 months by both.
3.2.6 Internal Compliance Program (ICP)
In Singapore, there is an Internal Compliance Program which is one
requirement of Bulk License Approval.
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For ICPs, an exporter will prepare the internal control as follows.235
1) Company’s Commitment Statement
2) Strategic Goods Officer/ Committee
3) Product Classification
4) End User Screening
5) Product Screening
6) End Use Screening
7) End Destination Screening
8) Transaction Screening
9) Shipping Control
10) Reporting and Emergency Notification
11) Record Keeping
12) Regular Training/ Education
13) Audit
14) Guidance to Subsidiary & Business Partners
Figure 3.2 Permission of DUI under Singapore Laws in Briefing236
235 George Tan, Export Controls. 236 George Tan, ‘Export Control’ (2013), [Singapore Manufacturing Federation] 8.
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3.3 Malaysia
Under UNSC Resolution 1540 which requires member states of the United
Nations to establish national control to prevent proliferation of nuclear, chemical, or
biological weapons that could be called “WMD” including their means of delivery
and related materials237
which include DUI, Malaysia as a UN member has
implemented the obligations under Articles 25238
and 48239
of the Charter of the
United Nations by enacting national export control laws following the adoption of the
Resolution 1540 called “the Strategic Trade Act 2010”. This Act has been effective
since 1 April 2011, after its publication in the Gazette since 10 June 2010.
240
The Strategic Trade Act, 2010 its designed to control export, transit,
transshipment and brokering of strategic items, including arms and related materials
237 United Nation Security Council Resolution 1540 (2004), Art 3.
238 Charter of United Nations, Art 25. “The Members of the United Nations agree to accept and carry out the decisions of the Security
Council in accordance with the present Charter.”
239 Charter of United Nations, Art 48.
“1. The action required to carry out the decisions of the Security Council for the maintenance of
international peace and security shall be taken by all the Members of the United Nations or by some of
them, as the Security Council may determine.
2. Such decisions shall be carried out by the Members of the United Nations directly and through
their action in the appropriate international agencies of which they are members.”
240 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 2.
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that could be used for the purposes of design, development, production and delivery
of WMD in accordance with UNSC Resolution 1540 and NPT, CWC and BWC.
In this Act, Strategic Items include “Military Items” in Part I and “DUI” in
Part II of the Strategic Items Order.241
Thus, Strategic Items refer to goods including software and technology
which have both civilian and military applications that can be used for development,
production, or use in nuclear, chemical and biological weapons, or missiles which are
capable of delivering these weapons; and also conventional arms and military
equipment. 242
3.3.1 Laws and Regulations
For Malaysia, there are some related laws used to control the Strategic
Items apart from the Strategic Trade Act 2010 as follows.243
1) Animals Act 1953
2) Atomic Energy Licensing Act 1984
3) Chemical Weapons Convention Act 2005
4) Customs Act 1967
5) Pesticides Act 1974
6) Plant Quarantine Act 1976
241 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 1. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
242 Strategic Trade Act 2010, Sections 2 and 7.
“Section 2 strategic items means any items prescribed as strategic items under section 7”
Section 7
(1) The Minister may, by order published in the Gazette, prescribe any items as strategic items for the purposes of this Act.
(2) If any question arises as to whether any item is or is not included in a class of items
appearing in an order made under subsection (1), such question shall be decided by the
Controller.”
243 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 1. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
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7) Prevention and Control of Infectious Diseases Act 1988
8) Protection of New Plant Varieties Act 2004
9) Poisons Act 1952
10) Malaysian Communications and Multimedia Commission Act 1998
However, if there is any conflict or inconsistency between ten related laws
mentioned above and the Strategic Trade Act 2010 regarding the prevention of the
proliferation of WMD, the Strategic Trade Act 2010 shall prevail and any conflict or
inconsistency provision of other laws shall be superseded.244
A part from the Strategic Trade Act 2010, there are also other relevant four
laws used for controlling the export of dual-use items.245
3.3.1.1 Strategic Trade Act 2010
Strategic Trade Act 2010 of Malaysia is an important export control law
that specifies Authority of Government Agencies246
, transactions subject to control247
,
definition of Strategic Items including DUI248
, permission249
, registration250
and
enforcement.251
In case this Act is in conflict or inconsistent with other laws on export
control of Strategic Items, this Act shall prevail.252
244 Ibid, 1.
245 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 3.
246 Strategic Trade Act 2010, Part II.
247 Ibid, Part III.
248 Ibid, Part I.
249 Ibid, Part IV.
250 Ibid.
251 Ibid, Part V.
252 Ibid, Section 3.
“(1) The provisions of this Act shall be in addition to, and not in derogation of, the provisions of any
other written law, including the related laws, relating to the prevention of the proliferation of weapons
of mass destruction and their delivery systems. (2) In the event of any conflict or inconsistency between the provisions of this Act and those of any
other written laws, including the related laws, the provisions of this Act shall prevail and the
conflicting or inconsistent provisions of the other written laws shall, to the extent of the conflict or
inconsistency, be deemed to be superseded.”
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3.3.1.2 Strategic Trade (Strategic Items) (Amendment)
Order 2017
Strategic Trade (Strategic Items) Order specifies the items that will be
controlled under Strategic Trade Act 2010 as “Strategic Items” issued by the Minister
of International Trade and Industry of Malaysia.253
For the Strategic Items in the
Order, are separated into two parts as follows.254
1) Part I: Military Items List which are specified into twenty-two categories
as M1-M22.255
2) Part II: Dual-Use Items List which are specified into ten categories as
following.256
- Category 0: Nuclear Materials, Facilities and Equipment
- Category 1: Special Materials and Related Equipment
- Category 2: Materials Processing
- Category 3: Electronics
- Category 4: Computers
- Category 5: Telecommunication and Information Security
- Category 6: Sensors and Lasers
- Category 7: Navigation and Avionics
- Category 8: Marine
- Category 9: Aerospace and Propulsion
3.3.1.3 Strategic Trade (Restricted End-Users and Prohibited
End-Users) Order
253 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 1. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
254 Ibid.
255 Strategic Trade (Strategic Items) (Amendment) Order 2017.
256 Ibid.
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Strategic Trade (Restricted End-Users and Prohibited End-Users) Order
issued by Minister of the Ministry of International Trade and Industry of Malaysia.
This Order specifies the countries restricted end-user or prohibited end-
user.257
Examples of countries restricted end-user are Afganistan, Congo, Eritria, Iran,
Iraq, Ivory Coast, Lebanon, Liberia, Libya, North Korea, Rwanda, Somalia, Sudan.258
For prohibited end-user are Democratic People’s Republic of Korea and Iran.259
3.3.1.4 Strategic Trade Regulations 2010
This Regulations specify the conditions of export permission, forms,
procedures, payable fees and any related matter including enforcement.260
3.3.2 Transaction Subject to Control
Transactions subject to control under Malaysia export control system
pursuant to the Strategic Trade Act 2010 are as follows.261
1) Export262
2) Bring in transit263
3) Transship264
257 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items 2012’, 1. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016. 258 Official Portal of the Ministry of International Trade and industry, ‘Prohibited and Restricted End
User List’ < http://www.miti.gov.my/index.php/pages/view/3420 > accessed 15 June 2017.
259 Ibid.
260 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 3. 261 Ibid, 5-10.
262 Strategic Trade Act 2010, Section 2.
“export” means—
(a) to take or cause to be taken out of Malaysia any items by land, sea or air, or to place any items in a
conveyance for the purpose of such items being taken out of Malaysia by land, sea or air; or (b) to transmit technology by any means to a destination outside Malaysia, and includes any oral or
visual transmission of technology by a communications device where the technology is contained in a
document the relevant part of which is read out, described or otherwise displayed over the
communications device in such a way as to achieve a similar result.
263 Strategic Trade Act 2010, Section 2.
“bring in transit” means to bring items from any country into Malaysia by and, sea or air, where the
items are to be taken out from Malaysia on the same conveyance on which they are brought into
Malaysia or any other conveyance and whether or not such items are landed or transshipped in
Malaysia, but does not include the passage through Malaysia in accordance with international law of a
foreign conveyance carrying any items.
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4) Brokering265
5) Intangible technology Transfer266
3.3.3 Classification of Controlled Items
Malaysia has adopted the same concept as that found in the EU List267
which are consistent with the international export control regimes. Thus, Strategic
Items subject to control under the Strategic Trade Act 2010 of Malaysia are separated
as follows.268
3.3.3.1 Listed Items (List Control)
Listed Strategic Items are separated into two lists as follows.269
3.3.3.1.1 Military Items List
In Part I of Strategic Trade (Strategic Items) (Amendment) Order 2017 of
Malaysia, Military Items List which is divided into twenty-two categories as M1-
M22.270
The items in this list are weapons that are used for military purposes.
3.3.3.1.2 Dual-Use Items List
264 Strategic Trade Act 2010, Section 2.
“tranship” means to remove items from the conveyance on which they were brought into Malaysia and
to place the items on the same or another conveyance for the purpose of taking them out of Malaysia
where these acts are carried out on a through bill of lading, through airway bill or through manifest.”
265 Strategic Trade Act 2010, Clause 2.
“brokering” means the activity of a person who, either on his own behalf or acting as an agent on
behalf of another person—
(a) negotiates, arranges for or facilitates the purchasing, financing, conveying, sale or supply of items; or
(b) buys, sells or supplies such items.
266 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 7.
267 Sudarat Pongpitak, ‘Investment Promotion for Dual-Use Goods’ (2013) 16.
268 Strategic Trade (Strategic Items) (Amendment) Order 2017.
269 Strategic Trade (Strategic Items) (Amendment) Order 2017.
270 Ibid.
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In Part II of the Strategic Trade (Strategic Items) (Amendment) Order
2017 of Malaysia, Dual-Use Items List is divided into ten categories271
as follows.
- Category 0: Nuclear Materials, Facilities and Equipment
- Category 1: Special Materials and Related Equipment
- Category 2: Materials Processing
- Category 3: Electronics
- Category 4: Computers
- Category 5: Telecommunication and Information Security
- Category 6: Sensors and Lasers
- Category 7: Navigation and Avionics
- Category 8: Marine
- Category 9: Aerospace and Propulsion
Category Codes specified each item in the List prescribed in the Strategic
Trade (Strategic Items) (Amendment) Order 2017 contain 5 characters namely one
character from technical category, one character from the product group, one
character from the regime origin and the remaining two character from the number of
items which are different from HS Codes of Customs Harmonized System.272
The meaning of Category Codes of Listed Items could be explained as
follows.273
1) The first character is from the Technical Category based on ten
categories of Dual-Use Items List
2) The second character is from the Product Group namely
A: Systems, Equipment Components;
271 Ibid
272 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 5. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
273 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 12.
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B: Test, Inspection and Product Equipment
C: Materials
D: Software
E: Technology
3) The third character is from the Regime Origin namely
0: Wassenaar or NSG Trigger List
1: MTCR
2: NSG Dual-Use List
3: AG
4: CWC
4) The fourth and Fifth are from the number of items
Examples of Category Code or Export Control Classification Number
(ECCN) include 1C118 (Titanium-stabilized duplex stainless steel)274
, 1C350
(Triethanolamine)275
and 1C216 (Maraging Steel)276
etc.
3.3.3.2 Unlisted277
Items (Catch-all Control)
Under the Strategic Trade Act 2010, although the items are not prescribed
in the Military Items List or Dual-Use Items List, they may be controlled by this Act
under the following criteria.278
1) To be informed by the relevant Authorities that the items may be used
for any restricted activity; or
274 Ibid, 13.
275 Ibid, 14.
276 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 7. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
277 Strategic Trade Act 2010, Section 2.
“Unlisted Items” means items that may be used in a restricted activity but are not prescribed as
strategic items under section 7.
278 Ibid, Section 12(1).
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2) To know or having reason to believe that the items may be used for
any
restricted activity.
Thus, the permission for export, transit, transshipment of Unlisted Items
has been applied prior to the conduct of such controlled activities.279
3.3.3.3 Technology Transfer Control
The transfer of intangible technology from Malaysia to the destination
outside Malaysia including any oral or visual transmission of technology by any
communication device280
are required to obtain permission if it is related to strategic
goods, software or technology under Dual-Use Items List or any software/technology
which is Unlisted under the Strategic Trade Act 2010.281
3.3.3.4 Special Control for Restricted Country
As a member of the United Nations, Malaysia implements the Resolutions
adopted by the UNSC in domestic laws. Thus, the restricted countries under such
Resolutions are prohibited for exportation or for any controlled activity. For example,
Democratic People’s Republic of Korea and Iran are Prohibited End-User List under
UN Resolution 1718 and 2231 respectively; or Afganistan, Congo, Eritria, Iran, Iraq,
Ivory Coast, Lebanon, Liberia, Libya, North Korea, Rwanda, Somalia, Sudan are
Restricted End-User under UN Sanction List.282
3.3.4 Permission
279 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 7. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
280 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 7.
281 Strategic Trade Act 2010, Sections 2, 7, 8 and 9.
282 Official Portal of the Ministry of International Trade and industry, ‘Prohibited and Restricted End
User List’ < http://www.miti.gov.my/index.php/pages/view/3420 > accessed 15 June 2017.
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According to the Malaysia Export Control System, an exporter has the
duty to review and determine whether his/her/its products are under the controlled of
Strategic Trade Act 2010 or is required to obtain a permission or license prior to
export. In this regard, there are four types of permission namely Single-Use Permit,
Multiple-Use Permit, Bulk Permit and Special Permit.283
3.3.4.1 Single-Use Permit
Single-Use Permit applies to one time export, transit or transshipment to
one country or one destination specified in the permit. This Permit has the period of
validity for 6 months.284
3.3.4.2 Bulk Permit
Bulk Permit must applies to multiple exports or transshipments of the
permitted items to one country or one destination specified in the permit.285
This
Permit has the period of validity for 2 years.286
Application for Bulk Permit will be
considered only in the case that the applicant company has Internal Compliance
Program (ICP) in place.287
3.3.4.3 Multiple-Use Permit
283 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 19.
284 Ibid.
285 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 2. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
286 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 19. 287 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 10. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
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Multiple-Use Permit applies to multiple exports or transshipments of the
permitted items to different countries or different destinations specified in the
Permit.288
This Permit has the period of validity for 2 year.289
However, application
for Multiple-Use Permit will be considered only in the case that the applicant
company has Internal Compliance Program (ICP) in place.290
3.3.4.4 Special Permit
Special Permit applies to one time export, transit or transshipment to one
country or one destination that the end-user is a Restricted End-User291
under the
Strategic Trade (Restricted End-Users and Prohibited End-Users) Order 2010. This
Permit has the period of validity for 1 year.292
3.3.5 Permit for Brokering
To operate brokering activities of the Strategic Items under Strategic Trade
Act 2010 in Malaysia, a person who is a broker is required to register and obtain the
Permit for Brokering such Strategic Items prior to the conduct of activities.293
This
Permit has the period of validity for 1 year.294
3.3.6 Offence, Penalty and Sanction
288 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 2. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
289 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 19.
290 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 10. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
291 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 2. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
292 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 19.
293 Strategic Trade Act 2010, Section 11 and 19.
294 Ministry of International Trade and Industry of Malaysia, ‘Strategic Trade Act 2010: Frequently
Asked Questions’, 11. <
http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/FAQ.pdf?mid=280 > accessed 1
October 2016.
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The offences, penalties and sanctions in cases of violation of export
control laws of DUI of Malaysia are mainly based on the provision of the Strategic
Trade Act 2010.
3.3.6.1 Offence and Penalty
Under the Strategic Trade Act 2010, the severities of penalties are applied
depended on the intention and knowledge of violators. Especially in case where a
violation causes casualties, the violator who is the natural person shall be punished by
a death sentence or life imprisonment. If the violator is a juristic person, it shall be
punished by fine of minimum amount of Ringgit Malaysia 30,000,000.295
3.3.6.1.1 Intentional export, transit, transshipment
without a Permit296
1) For Arms and Related Materials297
If the result of violation causes death, the violator who is the natural
person shall be punished by a death sentence or life imprisonment. If the violator is a
juristic person, it shall be punished by fine of a minimum amount of Ringgit Malaysia
30,000,000.298
In any other case, the violator who is the natural person shall be punished
by imprisonment at least 10 years or with a fine at least of Ringgit Malaysia
10,000,000. If the violator is a juristic person, it shall be punished by fine
of a minimum amount of Ringgit Malaysia 20,000,000.299
2) For other Strategic Items and Unlisted Items300
295 Strategic Trade Act 2010, Section 9(4)(a)(i)(A).
296 Strategic Trade Act 2010, Section 9(4)(a)(i) and 9(4)(b)(i).
297 Ibid, Section 9(4)(a)(i).
298 Ibid, Section 9(4)(a)(i)(A).
299 Ibid, Section 9(4)(a)(i)(B).
300 Section 9(4)(b)(i).
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The violator who is the natural person shall be punished by imprisonment
at least 10 years or fine at least of Ringgit Malaysia 10,000,000 or both. If the violator
is a juristic person, it shall be punished by fine of a minimum of amount Ringgit
Malaysia 20,000,000.301
3.3.6.1.2 Unintentionally export, transit, transshipment
without a Permit302
1) For Arms and Related Materials303
The violator who is the natural person shall be punished imprisonment at
least 5 years or with a fine at least of Ringgit Malaysia 5,000,000. If the violator is a
juristic person, it shall be punished by fine of a minimum amount of Ringgit Malaysia
10,000,000.304
2) For other Strategic Items and Unlisted Items305
The violator who is the natural person shall be punished by imprisonment
at least 5 years or fine at least of Ringgit Malaysia 5,000,000 or both. If the violator is
a juristic person, it shall be punished by fine a minimum amount of Ringgit Malaysia
10,000,000.306
3.3.6.1.3 Export, transit, transshipment Strategic Items to
Restricted End-User without a Special Permit307
1) Intentional export, transit, transshipment of Arms or Related Material308
301 Ibid.
302 Ibid, Section 9(4)(a)(ii) and 9(4)(b)(ii).
303 Ibid, Section 9(4)(a)(ii).
304 Ibid.
305 Ibid, Section 9(4)(b)(ii).
306 Ibid.
307 Ibid, Section 9(5).
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If the result of violation causes death, the violator who is the natural
person shall be punished by a death sentence or life imprisonment. If the violator is a
juristic person, it shall be punished by fine of a minimum amount of Ringgit Malaysia
30,000,000.309
In any other case, the violator who is the natural person shall be punished
by imprisonment at least 10 years or with a fine at least of Ringgit Malaysia
10,000,000. If the violator is a juristic person, it shall be punished by fine
of a minimum amount of Ringgit Malaysia 20,000,000.310
2) Intentional export, transit, transshipment of other Strategic Items and
Unlisted Items311
The violator who is the natural person shall be punished by imprisonment
at least 10 years or fine at least of Ringgit Malaysia 10,000,000 or both. If the violator
is a juristic person, it shall be punished by fine of a minimum amount of Ringgit
Malaysia 20,000,000.312
3) Unintentional export, transit, transshipment of Arms or Related
Material313
The violator who is the natural person shall be punished by imprisonment
at least 5 years or with a fine at least of Ringgit Malaysia 5,000,000. If the violator is
308 Ibid, Section 9(5)(a)(i).
309 Ibid, Section 9(5)(a)(i)(A).
310 Ibid, Section 9(5)(a)(i)(B).
311 Ibid, Section 9(5)(b)(i).
312 Ibid.
313 Ibid, Section 9(5)(a)(ii).
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a juristic person, it shall be punished by fine of a minimum amount of Ringgit
Malaysia 10,000,000.314
4) Unintentional export, transit, transshipment of other Strategic Items and
Unlisted Items315
The violator who is the natural person shall be punished by imprisonment
at least 5 years or fine at least of Ringgit Malaysia 5,000,000 or both. If the violator is
a juristic person, it shall be punished by fine of a minimum amount of Ringgit
Malaysia 10,000,000.316
3.3.6.1.4 Export, transit, transshipment of Strategic Items
to prohibited End-User317
1) Intentional export, transit, transshipment of Arms or Related Material318
If the result of violation causes death, the violator who is the natural
person shall be punished by a death sentence or life imprisonment. If the violator is a
juristic person, it shall be punished by fine of a minimum amount of Ringgit Malaysia
30,000,000.319
In any other case, the violator who is the natural person shall be punished
imprisonment at least 10 years or with a fine at least of Ringgit Malaysia 10,000,000.
If the violator is a juristic person, it shall be punished by fine of a minimum amount of
Ringgit Malaysia 20,000,000.320
2) Intentional export, transit, transshipment of other Strategic Items and
314 Ibid.
315 Ibid, Section 9(5)(b)(ii).
316 Ibid.
317 Ibid, Section 9(6).
318 Ibid, Section 9(6)(a)(i).
319 Ibid, Section 9(6)(a)(i)(A).
320 Ibid, Section 9(6)(a)(i)(B).
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Unlisted Items321
The violator who is the natural person shall be punished by imprisonment
at least 10 years or fine at least of Ringgit Malaysia 10,000,000 or both. If the violator
is a juristic person, it shall be punished by fine of a minimum amount of Ringgit
Malaysia 20,000,000.322
3) Unintentional export, transit, transshipment of Arms or Related
Material323
The violator who is the natural person shall be punished by imprisonment
at least 5 years or with a fine at least of Ringgit Malaysia 5,000,000. If the violator is
a juristic person, it shall be punished by fine of a minimum amount of Ringgit
Malaysia 10,000,000.324
4) Unintentional export, transit, transshipment of other Strategic Items and
Unlisted Items325
The violator who is the natural person shall be punished by imprisonment
at least 5 years or fine at least of Ringgit Malaysia 5,000,000 or both. If the violator is
a juristic person, it shall be punished by fine of a minimum amount of Ringgit
Malaysia 10,000,000.326
3.3.6.1.5 Operation of brokering of Strategic Items
without permit327
1) Brokering of Arms or Related Material328
321 Ibid, Section 9(6)(b)(i).
322 Ibid.
323 Ibid, Section 9(6)(a)(ii).
324 Ibid.
325 Ibid, Section 9(6)(b)(ii).
326 Ibid.
327 Ibid, Section 11(2).
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If the result of violation causes death, the violator who is the natural
person shall be punished by a death sentence or life imprisonment. If the violator is a
juristic person, it shall be punished by fine of a minimum amount of Ringgit Malaysia
30,000,000.329
In any other case, the violator who is the natural person shall be punished
by imprisonment at least 10 years or with a fine at least of Ringgit Malaysia
10,000,000. If the violator is a juristic person, it shall be punished by fine
of a minimum amount of Ringgit Malaysia 20,000,000.330
2) Brokering of other Strategic Items and Unlisted Items331
The violator who is the natural person shall be punished imprisonment at
least 5 years or with a fine at least of Ringgit Malaysia 5,000,000. If the violator is a
juristic person, it shall be punished by fine of a minimum amount of Ringgit Malaysia
10,000,000.332
3.3.6.1.6 Provision of technical assistance for use in
connection with a Restricted Activity333
If the result of violation causes death, the violator who is the natural
person shall be punished by a death sentence or life imprisonment. If the violator is a
328 Ibid, Section 11(2)(a).
329 Ibid, Section 11(2)(a)(i).
330 Ibid, Section 11(2)(a)(ii).
331 Ibid, Section 11(2)(b).
332 Ibid.
333 Ibid, Section 10 (1) “No person shall provide any technical assistance within or outside Malaysia if
such technical assistance is intended for use in connection with a restricted activity.
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juristic person, it shall be punished by fine of a minimum of amount Ringgit Malaysia
30,000,000.334
In any other case, the violator who is the natural person shall be punished
imprisonment at least 10 years or with a fine at least of Ringgit Malaysia 10,000,000.
If the violator is a juristic person, it shall be punished by fine of a minimum amount of
Ringgit Malaysia 20,000,000.335
3.3.6.1.7 Failure to Provide Information in the
Statement336
For offence of failure to provide information in the statement as a result of
the submission of false information or misleading information in any application,
report or other document for any purpose under the requirement of Strategic Trade
Act 2010 or other relevant laws, the violator who is the natural person shall be
punished by fine not exceeding 1,000,000 Ringgit Malaysia or by imprisonment for a
term not exceeding 2 years or both. If the violator is a juristic person, it shall be
punished by fine of a minimum amount of Ringgit Malaysia 2,000,000.337
3.3.7 Internal Compliance Program (ICP)
334 Ibid, Section 10(2)(a).
335 Ibid, Section 11(2)(b).
336 Strategic Trade Act 2010 Section 40 (1) “A person who submits false or misleading information in
any application, report or other document for any purpose under this Act or the related laws commits
an offence and shall, on conviction, be punished with a fine not exceeding one million ringgit or with
imprisonment for a term not exceeding two years or with both, and in the case of a body corporate, be
punished with a minimum fine of two million ringgit.
337 Strategic Trade Act 2010, Section 40.
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In Malaysia, there is Internal Compliance Program (ICP) which is the
required by Bulk Permit and Multiple-Use Permit. 338
ICP is the required internal procedures used for ensuring related operations
of a company who is an applicant to apply for Bulk Permit and Multiple-Use
Permit.339
ICP has been established in order to satisfy and ensure that efficient internal
control is in place.340
The key requirements of ICP are as follows.341
1) Company’s Commitment Statement
2) Strategic Goods Officer/ Committee at management level
3) Export control policy and procedure of the company
4) Screening processes such as product classification, product screening,
transaction screening, end-destination screening, end-user screening,
end-use screening and shipping-control
5) Reporting and emergency notification
6) Record Keeping, proper keeping period of document related to all
transaction of Strategic Items is at least six years.342
7) Regular Training/ Education
8) Audit
Figure 3.3 Permission of DUI under Malaysia Laws in Briefing343
338 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 2. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
339 Ministry of International Trade and Industry of Malaysia, ‘Export Control Internal Compliance
Program: Internal Compliance Program-A Guide’, 1.
<http://www.miti.gov.my/miti/resources/STA%20Folder/PDF%20file/Internal_Compliance_Program_
ICP_Guide.pdf >
340 Ibid. 341 Cynthia Lian, Shearn Delamore & Co, ‘Malaysia: Transit and Transhipment of Dual-Use Items
2012’, 2. < https://www.worldecr.com/wp-content/uploads/2012/07/Malaysia.pdf > accessed 1
December 2016.
342 Ibid.
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343 Strategic Trade Secretariat, Ministry of International Trade and Industry of Malaysia, ‘Facilitating
Trade in A Secure Trading Environment: What SME’s Need to Know on Strategic Trade Act 2010’,
24.
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CHAPTER 4
EXPORT CONTROL ON DUAL-USE ITEMS IN THAILAND
Before the issuance of the Ministerial Notification Specifies Dual-Use
Items as Goods Requiring Permission and Complying the Export Measures B.E.2558
(2015), Ministry of Commerce,, there were many export control laws of Thailand
adopted (enforced) relevant government agencies to control arms and armament, war
implements, chemical materials, toxic chemicals, chemical precursors,
microorganism, pathogen, animal toxin, radio communication equipment, Uranium,
Thorium, Plutonium and other by-products which could be used or applied for WMD
as follows.
1) Under the responsibility of Defence Industrial Department, Ministry of
Defence, there are 3 laws to control arms and armament, war implements, chemical
materials as follows.
a. The Act Controlling the Exportation of Arms, Armament and War
Implement, B.E.2495 (1952);
b. The Royal Decree Controlling the Exportation of Arms, Armament
and War Implement, B.E.2535 (1992), (No.2) B.E.2552 (2009);
c. Arms Control Act, B.E.2530 (1987).
Under the laws mentioned above, Ministry of Defence is responsible for
controlling of production, possession, importation, exportation and transfer of arms
and munitions by having the authority to approve the license based on the
consideration of end-user verification and purchase contract.
2) Under the responsibility of Department of Industrial Works, Ministry of
Industry, there is only the Hazardous Substance Act, B.E.2535 (1992) to control toxic
chemicals and chemical precursors.
Under this law, Ministry of Industry is responsible for controlling of
importation and exportation of toxic chemicals and any hazardous chemicals by
having the authority to approve license and setting inspection measures.
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3) Under the responsibility of Department of Medical Sciences, Ministry
of Public Health, there is only Pathogen and Animal Toxin Act, B.E.2558 (2015) to
control microorganism, pathogen and animal toxin.
4) Under the responsibility of Office of the National Broadcasting and
Telecommunications Commission, there is Radio Communication Act, B.E.2498
(1955) to control radio communication equipment.
5) Under the responsibility of Office of Atoms for Peace, Ministry of
Science and Technology, there is the Atomic Energy for Peace Act, B.E.2504 (1961)
to control Uranium, Thorium, Plutonium and other by-products that was repealed by
the Nuclear Energy for Peace Act, B.E.2559 (2016) issued in 2016 to control nuclear,
other radioactive materials and nuclear facilities.
6) Under the responsibility of Department of Foreign Trade, Ministry of
Commerce, there is the Export and Import of Goods Act, B.E.2522 (1979) to control
other goods which are not control by the other government agencies. Nevertheless, no
any applicable list of Dual-Use Items has been publicized.
7) Under the responsibility of the Customs Department, Ministry of
Finance, there is the Customs Act, B.E.2557 (2014) to control import, export, transit,
transshipment and re-export of goods under the customs law and other laws under the
control of related government agencies which empower to the Customs Departments.
The laws mentioned above are designed to control arms, armaments, war
implements, chemical materials, toxic chemicals, chemical precursors,
microorganism, pathogen, animal toxin, radio communication equipment and
Uranium, Thorium, Plutonium and other items which are weapons or could be used or
applied for WMD directly. However, there had been no applicable export control law
of DUI in Thailand until the Thai Cabinet endorsed the UNSCR 1540 (2004) on 10
August 2004. After such endorsement, the Cabinet has implemented the plans for
Thailand to comply with UNSCR 1540 since 20 July 2010 and the Ministry of
Commerce has been assigned to be the authorized agency to set Trade Management of
Dual-Use Items (TMD) including List of DUI. Then, the Ministerial Notification
Specifies Dual-Use Items as Goods Requiring Permission and Complying the Export
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Measures B.E.2558 (2015), Ministry of Commerce, was issued to implement the
UNSCR 1540 (2004) in 2015. Such Ministerial Notification is issued the provision of
Sections 5 (2), 5 (6) and 25 of the Import and Export of Goods pursuant to Act B.E.
2522 (1979) which is the first national export control law of DUI of Thailand and
executed by the Department of Foreign Trade, Ministry of Commerce. Thus, this
thesis studies and focuses on export control law of DUI under the responsibility of the
Department of Foreign Trade, Ministry of Commerce.
4.1 Applicable Export Control System in Thailand
The UNSCR 1540 (2004) on the prevention of proliferation of WMD
adopted by the UNSC on 28 April 2004 under the Chapter VII of Charter of the
United Nations.344
In response to the UNSC’s decisions, Article 25345
of the Charter
of the United Nations requires the members of the United Nations to accept and carry
out the decisions of the UNSC in accordance with the Charter of the United Nations
and Article 48346
of such Charter requires the members of the United Nations to carry
out the decisions of the UNSC for the maintenance of international peace and
security. Therefore, the members of the United Nations including Thailand is
obligated to accept and carry out the UNSC’s decisions including UNSCR 1540
(2004).
In implementing the UNSC Resolutions 1540 (2004) under Articles 25 and
48 of the Charter of the United Nations that requires Thailand and other members to
establish its national export control measures with an aim to prevent the proliferation
of WMD or any related materials including to set up and enforce export control laws
over DUI, Thailand, by the Minister of the Ministry of Commerce and upon
344 United Nations Security Council Resolution 1540.
345 The Charter of United Nations, Article 25.
“The Members of the United Nations agree to accept and carry out the decisions of the Security
Council in accordance with the present Charter.”
346 Charter of United Nations, Art 48.
“1. The action required to carry out the decisions of the Security Council for the maintenance of
international peace and security shall be taken by all the Members of the United Nations or by some of
them, as the Security Council may determine.
2. Such decisions shall be carried out by the Members of the United Nations directly and through
their action in the appropriate international agencies of which they are members.”
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authorization by the Cabinet, issued the Ministerial Notification Specifies Dual-Use
Items as Goods Requiring Permission and Complying the Export Measures B.E.2558
(2015) by virtue of the provisions of Sections 5 (2), 5 (6) and 15 of Import and Export
of Goods Act B.E. 2522 (1979) which is the first national export control law on DUI.
4.1.1 Laws and Regulations
In Thailand, the Ministerial Notification Specifies Dual-Use Items as
Goods Requiring Permission and Complying the Export Measures B.E.2558 (2015) is
the first specific laws on export control of DUI.
Section 3 of the Ministerial Notification mentioned above defines the
“Dual-Use Goods” to mean goods which can be used for both commercial and
military applications, in design, development, manufacture, utilization, modification,
storage, transport or by an act in any way in order to acquire weapon of mass
destruction. Likewise, the terms “weapon of mass destruction” means nuclear
weapon, chemical weapon, biological weapon or any other weapon, which can cause
harm to a large number of casualty or cause serious damage to environment, including
guidance system with rocket, missile or any other unmanned air system of these
weapons.347
4.1.2 Transaction Subject to Control
This Ministerial Notification is issued pursuant to the provisions of
Sections 5 (2), 5 (6) and 15 of the Import and Export of Goods Act B.E. 2522
(1979). Therefore, the transactions subject to control are export, re-export of dual-
use goods, (bringing in) transit348
which include transit and transshipment of related to
such goods.
347 The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015) Section 3.
348 Export of Goods Act B.E. 2522 (1979)
“Bringing in Transit” refers to activities that goods with an origin and final destination outside of
country are passing through Thailand regardless of whether there is any warehousing, changing of
mode of transport, changing of container for transportation involved. It is prohibited to use such goods
within the country.
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However, the Ministerial Notification Specifies Dual-Use Items as Goods
Requiring Permission and Complying the Export Measures B.E.2558 (2015) does not
cover intangible technology transfer which are any software or the electronic
transmission of DUI via e-mail, fax, computer or server are not specified under
“Controlled Activities” in this Ministerial Notification. Likewise, the scope of goods
defined in the Ministerial Notification Specifies Dual-Use Items as Goods Requiring
Permission and Complying the Export Measures B.E.2558 (2015) covers tangible
goods only.349
Moreover, there is no provision on brokering both in the Import and
Export of Goods Act B.E. 2522 (1979) and in the Ministerial Notification.
4.1.3 Classification of Controlled Items
Under the Ministerial Notification Specifies Dual-Use Items as Goods
Requiring Permission and Complying the Export Measures B.E.2558 (2015),
controlled lists are as follows.
4.1.3.1 List 1 or List of Dual-Use Items
List 1 is prepared based on the EU List that is consistent with the goods
under the Multilateral Export Control Regimes namely NSG, AG, MTCR, WA and
CWC comprising nine categories as follows.350
Category 0: Nuclear material, Facilities and Equipment
Category 1: Special Material and Related Equipment
Category 2: Materials Processing
Category 3: Electronics
Category 4: Computer
Category 5: Telecommunications and “Information Security”
Category 6: Sensors and Lasers
Category 7: Navigation and Avionics
Category 8: Marine
Category 9: Aerospace and Propulsion
349 Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and Complying
the Export Measures B.E.2558 (2015) Section 3. 350 Ibid, List of Dual-Use Items.
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4.1.3.2 List 2 or HS Code List
List 2 is prepared based on the HS Code of controlled goods.
4.1.4 Export Permission
At present, the Ministry of Commerce of Thailand has established the
system of Trade Management of Dual-Use Items and plans to apply this system to the
activities controlled by the Import and Export of Goods Act B.E. 2522 (1979) and the
Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015) such as export, re-export, transit
and transshipment; however, no any legislation or applicable laws has been
publicized.
4.1.4.1 E-Classification
The Ministry of Commerce announced in the seminar that this system is
used for classifying and verifying dual-use goods.351
4.1.4.2 E-Certification
This system used for certifying that the goods in List 2 (HS Code List) of
the Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission
and Complying the Export Measures B.E.2558 (2015) are not for dual-use goods.352
4.1.4.3 E-Licensing
This system is used for verifying End-Use and End-User before approve
export license. Currently, there is no legislation or applicable law.
351 Department of Foreign Trade, Trade Management of Dual-Use Items: TMD/ Trade Control of
Weapons of Mass Destruction Related Items: TCWMD, 25 May 2016.
352 Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and Complying
the Export Measures B.E.2558 (2015), Section 5.
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4.1.5 Offences, Penalties and Sanctions
4.1.5.1 Export without License353
Violator shall be punished by imprisonment not exceeding ten years or
fine equivalent to five times of the value of exported goods, or both. Moreover, such
goods including containers and vehicles used in connection with this violation shall be
confiscated.354
4.1.5.2 Failure to Comply with The Notification Issued by
Ministry of Commerce or Ministry of Finance
Violator who failed to comply with the Notifications shall be punished by
imprisonment not exceeding 1 year or fine not exceeding 20,000 Baht, or both. 355
4.1.6 Internal Compliance Program (ICP)
Currently, there is no applicable law or legislation regarding internal
compliance program in Thailand; but, the Department of Foreign Trade, Ministry of
Commerce has announced a plan to issue the ICP in compliance with the Ministerial
Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying with the Export Measures B.E.2558 (2015) which is the requirement of
Bulk Permission. ICP has been established in order to satisfy and ensure that efficient
internal control is in place. The key requirements of ICP in each entity should be.356
1) Commitment of Top Management
2) Trade Screening for End-Use and End-User
3) Training
4) Record Keeping
5) Auditing
353 Import and Export of Goods Act B.E. 2522 (1979), Section 7.
354 Ibid, Section 20. 355 Ibid, Section 22.
356 Department of Foreign Trade, Ministry of Commerce of Thailand, “Trade Management of Dual-Use
Items: TMD (Trade Control on Weapons of Mass Destruction Related Items: TCWMD), 29.
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6) Penalties and Reporting
Figure 4.1 Permission of DUI under Thai Laws in Briefing
4.2 Draft Trade Control of WMD Related Items
During the grace period of the Ministerial Notification Specifies Dual-Use
Items as Goods Requiring Permission and Complying with the Export Measures
B.E.2558 (2015), no clear regulations are applied under this Ministerial Notification.
However, the Thai government has announced a plan to enact the new export control
law of DUI called “Draft Trade Control of WMD Related Items or TCWMD” and the
principles of this Draft are approved by the Cabinet since 4 October 2016 to control
export, re-export, transit, transshipment and brokering all goods that can be applied
for WMD including DUI for preventing proliferation of WMD. After such approval,
the draft TCWMD will be considered by the Office of the Council of State before
proposing to National Legislative Assembly for enactment.
4.2.1 Laws and Regulations
The new draft export control law of DUI called the “Draft-Trade Control
of WMD Related Items”
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4.2.2 Transaction Subjected to Control
Controlled transactions under the Draft Trade Control of WMD Related
Items include export, re-export, transshipment, bring-in transit and brokering.357
However, intangible technology transfer which are any software or the
electronic transmission of DUI via e-mail, fax, computer or server are not specified
under “Controlled Activities” in the new Draft.358
Then, the scope of goods in the
definition of this laws still focuses on tangible goods only. It does not cover intangible
technology transfer.
4.2.3 Classification of Controlled Items
Currently, the Draft controlled items or List of Dual-Use Items has not
been announced. Nevertheless, the Department of Foreign Trade should use same
scheme with that of the Ministerial Notification Specifies Dual-Use Items as Goods
Requiring Permission and Complying with the Export Measures B.E.2558 (2015) that
could be specified the controlled lists as follows.359
4.2.3.1 List 1 or List of Dual-Use Items
List 1 is prepared based on the EU List that is consistent with the goods
under the Multilateral Export Control Regimes namely NSG, AG, MTCR, WA and
CWC comprising nine categories as follows.360
Category 0: Nuclear material, Facilities and Equipment
Category 1: Special Material and Related Equipment
Category 2: Materials Processing
Category 3: Electronics
Category 4: Computer
357 Draft of Trade Control of WMD Related Items Act, Section 3 “Controlled Activities”.
358 Ibid.
359 Department of Foreign Trade, Ministry of Commerce of Thailand, “Trade Management of Dual-Use
Items: TMD (Trade Control on Weapons of Mass Destruction Related Items: TCWMD), 20.
360 Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and Complying
with the Export Measures B.E.2558 (2015), List of Dual-Use Items.
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Category 5: Telecommunications and “Information Security”
Category 6: Sensors and Lasers
Category 7: Navigation and Avionics
Category 8: Marine
Category 9: Aerospace and Propulsion
4.2.3.2 List 2 or HS Code List
List 2 is prepared based on HS Code of controlled goods including
Munitions List and other List specified by characteristic of goods.361
4.2.4 Export Permission
Currently, the Draft export permission has not been announced.
Nevertheless, the Department of Foreign Trade should use same scheme with that of
the Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission
and Complying with the Export Measures B.E.2558 (2015) to control related
activities such as export, re-export, transit, transshipment, brokering and financing
that could be specified the type of export permission as follows.362
4.2.4.1 E-Classification
The Ministry of Commerce announced in the seminar that this system is
used for classifying and verifying Dual-Use Goods.363
361 Department of Foreign Trade, Ministry of Commerce of Thailand, “Trade Management of Dual-Use
Items: TMD (Trade Control on Weapons of Mass Destruction Related Items: TCWMD), 20. 362
Department of Foreign Trade, Ministry of Commerce of Thailand, “Trade Management of Dual-Use
Items: TMD (Trade Control on Weapons of Mass Destruction Related Items: TCWMD), 24. 363 Department of Foreign Trade, Trade Management of Dual-Use Items: TMD/ Trade Control of
Weapons of Mass Destruction Related Items: TCWMD, 25 May 2016.
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4.2.4.2 E-Certification
This system used for certifying that the goods in HS Code List of the new
Draft does not cover Dual-Use Goods.364
4.2.4.3 E-Licensing
This system is used for verifying End-Use and End-User before approving
export license. Currently. There is no legislation or applicable law.
4.2.5 Offences, Penalties and Sanctions
In the Draft, the provisions regarding penalties are specified in Chapter 6
as follows.365
4.2.5.1 Export, transit, transship and brokering without
the Permission
The violator shall be punished by imprisonment not exceeding 10 years or
fine not exceeding 10,000,000 Baht or both.366
Furthermore, the Dual-Use Goods
including the container or package in this matter shall be confiscated.367
364The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015), Article 5.
365 New Draft of Trade Control of WMD Related Items Act approved by the Cabinet on 4 October
2016, Section 39-52.
366 Ibid, Section 39 para 1.
367 Ibid, Section 39 para 3.
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4.2.5.2 Intentional export, transit, transshipment and brokering
without Permission to design, develop, utilize, modify,
store, deliver, support or act in any way in order to
acquire WMD or use it to cause harm to any person
The violator shall be punished by imprisonment not exceeding 20 years or
fine not exceeding 20,000,000 Baht or both.368
Furthermore, the Dual-Use Goods
including the container or package in this matter shall be seized.369
4.2.5.3 Violation of the measures with the aim to control the
proliferation of goods related to WMD issued under
Section 9(3)
The violator shall be punished by imprisonment not exceeding 15 years or
fine not exceeding 15,000,000 Baht or both.370
Furthermore, the Dual-Use Goods
including the container or package in this matter shall be confiscated.371
4.2.5.4 Violation of the measures with the aim to control
the proliferation of goods related to WMD issued under
Section 9(3) in order to design, develop, utilize, modify,
store, deliver, support or act in any way to acquire WMD
or use it to cause harm to any person
The violator shall be punished by imprisonment not exceeding 25 years or
fine not exceeding 25,000,000 Baht or both.372
Furthermore, the Dual-Use Goods
including the container or package in this matter shall be confiscated.373
4.2.5.5 Violate the measure for Controlled Activities with the aim
to control the proliferation of goods related to WMD
issued under Section 10
368 Ibid, Section 39 para 2.
369 Ibid, Section 39 para 3.
370 Ibid, Section 40 para 1. 371 Ibid, Section 40 para 3. 372 Ibid, Section 40 para 2. 373 Ibid, Section 40 para 3.
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The violator shall be punished by imprisonment not exceeding 12 years or
fine not exceeding 12,000,000 Baht or both.374
4.2.5.6 Violation of the measures for Controlled Activities with
the aim to control the proliferation of goods related to
WMD issued under Section 10 in order to design, develop,
utilize, modify, store, deliver, support or act in any way to
acquire WMD or use it to cause harm to any person
The violator shall be punished by imprisonment not exceeding 22 years or
fine not exceeding 22,000,000 Baht or both.375
4.2.5.7 Intentional export, transit, transshipment and brokering
without the Permission in order to design, develop, utilize,
modify, store, deliver, support or act in any way to
acquire WMD or use it to cause harm to any person and
the result cause the death
The violator shall be punished by life imprisonment or imprisonment not
exceeding 30 years and fine not exceeding 50,000,000 Baht.376
4.2.5.8 Violation of the measures with the aim to control the
proliferation of goods related to WMD issued under
Section 9(3) in order to design, develop, utilize, modify,
store, deliver, support or act in any way to acquire WMD
374 Ibid, Section 41 para 1.
375 Ibid, Section 41 para 2.
376 Ibid, Section 42.
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or use it to cause harm to any person and the result cause
the death
The violator shall be punished by life imprisonment or imprisonment not
exceeding 30 years and fine not exceeding 50,000,000 Baht.377
4.2.5.9 Violation of the measures for Controlled Activities with
the aim to control the proliferation of goods related to
WMD issued under Section 10 in order to design, develop,
utilize, modify, store, deliver, support or act in any way to
acquire WMD or use it to cause harm to any person and
the result cause the death
The violator shall be punished by life imprisonment or imprisonment not
exceeding 30 years and fine not exceeding 50,000,000 Baht.378
4.2.5.10 Submission of false information or misleading
information in order to obtain the permission or
any certification for Controlled Activities, End-Use
or End-User under Section 9
The violator shall be punished by imprisonment not exceeding 20 years or
fine not exceeding 20,000,000 Baht or both.379
4.2.5.11 Obstruction of the Authority who has the duties under
Section 32 and 35 or Failure to provide facilitation
The violator shall be punished by imprisonment not exceeding 1 year or
fine not exceeding 50,000 Baht or both.380
377 Ibid.
378 Ibid.
379 Ibid, Section 43.
380 Ibid, Section 44.
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4.2.5.12 Permission by owner of license, certificate or any other
document to allow any person to use license, certificate
or any other document issued under Section 9 for
Controlled Activities related to WMD which is not
his/her/its activities
The violator shall be punished by imprisonment not exceeding 10 years or
fine not exceeding 10,000,000 Baht or both.381
4.2.5.13 Failure to renew within the due date
The violator shall be punished by fine not exceeding 2,000 Baht.382
4.2.5.14 Use of the license or any other document issued under
Section 9 expired
The violator shall be punished by fine not exceeding 2,000 Baht.383
4.2.5.15 Provision of false statements or submission of
explanation, account, information, document or
any evidence under Section 32 (4) and (5)
The violator shall be punished by fine not exceeding 50,000 Baht.384
4.2.5.16 Liabilities of director manager or any persons
responsible for385
the operations of the entity
The penalty provisions in this Draft will include a presumption that the
managing director, manager or any persons responsible for the operations of the entity
found to be in violation of this Draft; if a violation by such legal entity is due to an
order or performance of any person, or a neglect of order or, a neglect of a duty as
381 Ibid, Section 45.
382 Ibid, Section 46.
383 Ibid, Section 47.
384 Ibid, Section 46.
385 Ibid, Section 51.
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required as a managing director or of any person who is responsible for carrying out
the business of such entity, such person shall be penalized according to the provisions
prescribed for such violations.
4.2.6 Internal Compliance Program (ICP)
Currently, there is no official announcement of Internal Compliance
Program (ICP) under this Draft; but, the Department of Foreign Trade, Ministry of
Commerce will use same scheme as the plan issued to comply with the Ministerial
Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying with the Export Measures B.E.2558 (2015) which is the requirement of
Bulk Permission. ICP has been established in order to satisfy and ensure that efficient
internal control is in place.
The key requirement of ICP in each entity should be.386
1) Commitment of Top Management
2) Trade Screening for End-Use and End-User
3) Training
4) Record Keeping
5) Auditing
6) Penalties and Reporting
4.3 Problem on Export Control of Dual-Use Items in Thailand
After examining Thai laws on export control of DUI regarding the
background, international law, foreign laws namely Japan, Singapore and Malaysia
comparing with Thai laws, the Author found the problems as follows.
4.3.1 Non-Compliance with UN Resolution 1540 on the Control of
Brokering
386 Department of Foreign Trade, Ministry of Commerce of Thailand, “Trade Management of Dual-Use
Items: TMD (Trade Control on Weapons of Mass Destruction Related Items: TCWMD), 29.
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Referring to the activities subjected to control under Thai laws, there is no
provision on brokering both in the Import and Export of Goods Act B.E. 2522 (1979)
and in the Ministerial Notification. Thus, this Ministerial Notification does not covers
the requirements of UNSCR 1540 because its enforcement does not cover brokering
and intangible technology transfer that are Controlled Activities under UNSCR 1540.
Comparing with the other countries namely Japan, Singapore and Malaysia
as mentioned in the previous Chapter, all countries have the control provisions of
brokering transactions related to DUI.
Thus, Thailand as a UN member state is required to comply with the
Resolution by establishing “Export Control Measure” that covered DUI and
technology transfer.
4.3.2 Non-Compliance with UN Resolution 1540 on the Control of
Technology
Referring to the definition of “Dual-Use Goods” under this Notification
that refers to goods which can be used for both commercial and military applications,
in design, development, manufacture, utilization, modification, storage, transport or
act in any way in order to acquire weapon of mass destruction,387
there is no other
regulations issued under the Ministerial Notification Specifies Dual-Use Items as
Goods Requiring Permission and Complying with the Export Measures B.E.2558
(2015) which control transaction of brokering and technology transfer. Thus, this
Ministerial Notification does not covers the requirements of UNSCR 1540 because its
enforcement does not cover brokering and intangible technology transfer that are
Controlled Activities under UNSCR 1540.
Comparing with the other countries namely Japan, Singapore and Malaysia
as mentioned in the previous Chapter, all countries have the control provisions of
technology transfer.
387The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015), Section 3.
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For Japan, the controlled list of technologies is under the Foreign
Exchange Order issued by the Cabinet under Article 25 of Foreign Exchange and
Foreign Trade Act that are separated into three cases as follows.
(1) Technology Transfer from Japan to Foreign Company that any person
who would like to transfer technology specified in the controlled List from Japan to
other countries is required to obtain permission. However, such permission is not
applied in the case that the person would like to use such technologies by himself in
other countries.388
(2) Transfer within Japan that a person who is a resident of Japan would
like to transfer technologies controlled by the List under the Foreign Exchange Order
to a non-resident in Japan, the resident is also required to obtain the permission.389
(3) Technology Transfer in Foreign Country that the person who is a
resident of Japan would like to transfer technologies controlled by the List under the
Foreign Exchange Order to a non-resident in foreign countries, the resident is required
to obtain permission.390
Nevertheless, such permission is not applied to a case where
such technology originates outside Japan and its transactions are accomplished
outside Japan.391
For Singapore, the transfer of intangible technology in Singapore is
required to obtain permission if it is strategic goods, software or technology under
Dual-Use List or any software/technology under Catch-all Control.
For Malaysia, the transfer of intangible technology from Malaysia to the
destination outside Malaysia including any oral or visual transmission of technology
388 The Foreign Exchange and Foreign Trade Act, Art 25.
389 Ibid.
390 Ibid.
391 Center for Information on Security Trade Control of Japan, Overview of Japan’s Export Control
(4th edn, 2015) 12-13.
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by any communication device392
are required to obtain permission if it is related to
strategic goods, software or technology under Dual-Use Items List or any
software/technology which is Unlisted under the Strategic Trade Act 2010.393
Therefore, Thailand as a UN member state is required to comply with the
Resolution by establishing “Export Control Measure” that covered DUI and
technology transfer.
4.3.3 Export Control System
Referring to the Ministerial Notification Specifies Dual-Use Items as
Goods Requiring Permission and Subject to Comply with the Export Measures
B.E.2558 (2015), which cover the dual-used items that may have impact on big
industries as follows.
1) Automotive
2) Steel
3) Electronics
4) Semiconductors
5) Computer
6) Telecommunications
7) Chemical and pharmaceutical
8) Medical
This Ministerial Notification shall come into force on 1 January 2018394
.
However, there is no regulation under or related to this Notification that. Therefore,
exporters could not prepare themselves for the compliance.
After studying export control laws on Dual-Use Items in Thailand and
comparing then with those of Japan, Singapore and Malaysia, there is no specific laws
392 Mohamed Shahabar Abdul Kareem, ‘The Strategic Trade Act (STA) 2010: Facilitating Trade in A
Secure Trading Environment’, 7.
393 Strategic Trade Act 2010, Sections 2, 7, 8 and 9.
394 Ibid, Section 2.
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regarding the export license measures in Thailand that exporters are subject to apply
for the permission prior to export DUI395
under Ministerial Notification mentioned
above. Thus, there are unclear procedures that may create an obstacle to exporters to
comply with such laws.
4.3.4 Penalty and Sanction
In case of violation, the penalties for having no export license or for failure
to comply with such Ministerial Notification is too high and not consistent with the
act of violator because violator is subject to be liable under the provision of section 22
of Import and Export of Goods Act B.E. 2522 (1979) to be punished by imprisonment
not exceeding ten years or fine equivalent to five times of the value of exported
goods, or both whether by intention or mistake. Comparing applicable laws of
Thailand with Japan, Singapore and Malaysia, there are some differences between
those and those of Thailand. All countries except Thailand consider the penalty of
each offense based on the ground of intention and knowledge of violator.
For Japan, the violator who export or brokerage of goods or technologies
related to WMD without permission shall be punished by imprisonment or fine with
the rate of penalty higher than the violator who export or brokerage of goods or
technologies related to convention arms. Likewise, the administrative sanction will be
applied for a violation of a petty offense that a violator shall be punished by
prohibition of export not more than 3 years. Certain, the METI has the authority to
issue a warning which is served upon a violator when the violation is not so serious.
For Singapore, to commit the offence regarding false declarations or
failure to comply with conditions of permit, the violator shall be punished by
imprisonment or fine with the rate of penalty higher than the offence regarding refusal
or failure to keep or submit record.
For Malaysia, the violator who intended to export arms and related
materials without the permit shall be punished by a death sentence or life
395 Ibid, Section 4 and 5.
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imprisonment, if the result of violation causes death. But, in any other case, the
violator shall be punished by imprisonment at least 10 years or with a fine at least of
Ringgit Malaysia 10,000,000.
Thus, from the author’s point of view, the penalty and sanction of Thailand
is not appropriate.
Although Thailand has ratified the International Covenant on Civil and
Political Right (ICCPR) adopted by the United Nations General Assembly (UNGA)
since 1996, death penalty could be imposed in case of most serious crimes. Death
penalty in cases that the violators have intention to kill or result of the offences are the
loss of life is not in conflict with the right to life under Article 6 of the ICCPR. Then,
provisions of each offences and penalties under the new Draft Trade Control of WMD
Related Items Act are more appropriate than those in the Ministerial Notification.
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CHAPTER 5
CONCLUSION AND RECOMMENDATIONS
5.1 Conclusion
This thesis focuses on export control laws of DUI in Thailand that are
controlled by the Ministerial Notification Specifies Dual-Use Items as Goods
Requiring Permission and Complying with the Export Measures B.E.2558 (2015).
As compared to the laws of Japan, Singapore and Malaysia, it can be
concluded that the Thai Ministerial Notification Specifies Dual-Use Items as Goods
Requiring Permission and Subject to Comply with the Export Measures B.E.2558
(2015) does not cover the requirements of UNSC Resolution 1540 because its
implementation does not cover brokering and intangible technology transfer.
Furthermore, Thailand has no provisions regarding export permission
measures of DUI. Thus, this may cause unclear practices in operation of the exporters.
Based on the study in Chapter 3 of this thesis, Japan, Singapore and Malaysia have
the export permission measures and the types of permission are categorized as
Individual Permission and Bulk Permission that are convenient for exporters to apply
and comply with such measures. Comparing with the laws of Japan, Singapore and
Malaysia, Thailand should establish export control measures of DUI for trade
management such as export license procedure, technology transfer procedures and
internal control program for exporters etc. in order to ensure that the dual-goods are
controlled and the entrepreneurs and their staffs are able to understand and comply
with the Thai export control laws.
Moreover, the Ministerial Notification Specifies Dual-Use Items as Goods
Requiring Permission and Complying with the Export Measures B.E.2558 (2015) is
prescribed under the “Export and Import of Goods Act B.E.2522 (1979)” in which the
penalty in case of violations of this Notification have to be based on Section 22 of
such Act. Thus, if there are a violation of this Notification whether by intention or
mistake, violator shall be punished by imprisonment not exceeding ten years or fine
equivalent to five times of the price of exported goods, or both, and the goods
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including containers and vehicles used in connection with such violation shall be
confiscated. Comparing the laws of Thailand with those of Japan, Singapore and
Malaysia, all countries except Thailand consider the penalty of each offense based on
the ground of intention and knowledge of violator. This is the significant differences
that Thai government should consider for developing Thai laws to encourage the
investors to operate DUI business in Thailand.
Therefore, this thesis suggests that it be an appropriate time for Thailand to
enact the “Trade Control on Weapons of Mass Destruction Related Items Act” that
covers dual-use goods, intangible technology transfer and any activities related to
WMD in order to ensure security and to protect the benefits of the state in compliance
with international agreements and to protect Thai entrepreneurs from non-tariff trade
barriers in other countries.
5.2 Recommendations
From the analysis mentioned above and the author’s perspectives, this
thesis would like to provide the recommendations as follows.
5.2.1 Establishment of Export Control for Brokering and Technology
Transfer
The Ministerial Notification controls only export of Dual-Use Goods396
from Thailand; but, it does not cover brokering and technology transfer397
that
Resolution 1540 requires all member states to take and enforce effective measures to
establish domestic controls over WMD related materials, equipment and technology
covered by relevant multilateral treaties which could be used for the design,
development, production or use of WMD.398
Therefore, Thailand as a UN member
state is required to comply with the Resolution by establishing “Trade Control on
Weapons of Mass Destruction Related Items Act” that covered DUI, technology
transfer and any activities of WMD namely export, re-export, transshipment, transit
396The Ministerial Notification Specifies Dual-Use Items as Goods Requiring Permission and
Complying the Export Measures B.E.2558 (2015), Ministry of Commerce, s 3. 397Tamotsu Aoi, Historical Background of Export Control Development in Selected Countries and
Regions (2016) 17. 398 United Nation Security Council Resolution 1540 (2004), Definitions 1.
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and brokering in order to prevent the proliferation of WMD and to strengthen export
control enforcement of Thailand.
5.2.2 Categories of Export License as Individual License and
Bulk License
Under the Trade Control on Weapons of Mass Destruction Related Items
Act, the Thai government should formulate regulations for technology or software
transfer and export license issuance on controlled transactions namely export, re-
export, transshipment, bringing in transit and brokering by adopting Japanese laws
because export permission under the Japanese laws is issued by item and shall be
based on the country of destination together with the recipient entity; then, export
license should be separated into two types of license as follows.
5.2.2.1 Individual License
For Individual License, the permission is based on a transaction.
5.2.2.2 Bulk License
For Bulk License the permission is valid for multiple transactions into with
the specified period in which exporter is required to establish proper internal control
system based on the requirements of Internal Compliance Program (ICP) designed by
the Department of Foreign Trade.
Bulk License should be categorized as three types as follows
1) Bulk License for combination of items and destination that an exporter
who obtains this License could export specific dual-use items to
foreign countries. However, the exporter is prohibited to export such
dual-goods items to the restricted countries specified by the Thai
government.
2) Bulk License for the same customer that an exporter who obtains this
License could export specific DUI to specific customer who is business
partner repeatedly.
3) Bulk License for overseas subsidiaries that an exporter who is the
manufacturer and obtains this License could export specific DUI to
subsidiaries in foreign countries repeatedly
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5.2.3 Establishment of Internal Control Program (ICP)
Referring to Internal Compliance Program (ICP), this thesis suggests that
the Thai government should require exporters to establish then own internal program
for export control covering management policy, export control of organization, export
procedures, record of shipment confirmation, internal audit, training, record keeping
procedures and penalties of violation etc. that are necessary for Bulk License
Approval. Due to the fact that ICP is a voluntarily commitment provided by an
exporter to support the government authorities by ensuring that internal controls and
procedures are proper and satisfactory to the government that the exporter has the
proper screening procedures such as items classification, customer screening, end-use
or end-user verifying and transactions screening to certify that any DUI exported by
an exporter is not related to the proliferation of WMD before the approval of bulk
license to allow the exporter carrying its business to facilitate trade of government.
5.2.4 Infliction of the Penalties for Each Offences Based on Ground of
Intention and Knowledge of Violator.
Under the Ministerial Notification, the penalties for having no export
license is too high and not consistent with the act of violator because violator is
subject to liable under the provision of Section 22 of Import and Export of Goods Act
B.E. 2522 (1979) that violator shall be punished by imprisonment not exceeding ten
years or fine equivalent to five times of the price of exported goods, or both whether
by intention or mistake.
The penalties are likely to be significant because the penalties for having
no export license or should be consistent with the act of violator. Then, the Draft
Trade Control of WMD Related Items Act should be revised with respect to penalties
of any offence in case where the result of violation causes death to any person to be
the death penalty for the violator. Although Thailand, as a member of United Nations
and the International Covenant on Civil and Political Rights (ICCPR) has obligations
to abolish death penalty, paragraph 2 of Article 6 of the ICCPR states that the
sentence of death may be imposed only for the “most serious crimes” in countries that
have not abolished the death penalty.
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However, the penalty provisions in this Draft will include a presumption
that the managing director, manager or any person responsible for the operations of an
entity found to be in violation of this Draft; if a violation by such legal entity is due to
an order or performance of any person, or a neglect of order or, a neglect of a duty
required as a managing director or of any person who is responsible for carrying out
the business of such entity, such person shall be penalized according to the provisions
prescribed for such violations. Then, the government authorities have to consider and
set the penalty for each offence based on the ground of intention and knowledge of
violator. Although the representatives of legal entity are presumed innocent until
proven guilty, all directors listed in the company registration would be named as
defendants and each of them needs to prove to the satisfaction of the court that such
offense was committed without their knowledge or consent. Due to the fact that such
presumption of liability was a heavy legal burden for the representatives of the entity
who were forced to produce evidence to prove their innocence, the Thai government
should reconsider the penalties under the Draft of Trade Control of WMD Related
Items Act and setting each offence and penalty clearly. Nevertheless, violators are
subject to penalties or sanctions, which may vary depending on the case.
5.2.5 Establishment of Administrative Penalties for Violation without
Intention.
When a violation is not so serious or in case where of a minor technical
offense is committed without the intention, only an administrative sanction may be
imposed on the violator. Therefore, the Department of Foreign Trade should have the
authority to take administrative measures such as revocation of a permit and to
prohibit a person who has engaged in the transactions violating this law with the
intention from the exporting and transferring technology for 2 years.
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REFERENCES
Books
Anna Wetter. Enforcing European Union Law on Exports of Dual-Use Goods Oxford:
Oxford University Press, 2009.
Daniel H. Joyner. International Law and the Proliferation of Weapons of Mass
Destruction. Oxford: Oxford University Press, 2009.
Jumphot Saisoonthorn. International Law, (The Project for the Promotion of
Textbooks and Teaching Materials) Faculty of Law. Bangkok: Thammasat
University, 2016.
Kari M. Meesen, Prof. Dr. International Law of Export Control Jurisdiction Issues.
London: Graham & Trotman Ltd, 1992.
Olivia Bosch and Peter Van Ham. Global Non-Proliferation and Counter-Terrorism
The Impact of UNSCR 1540. London: Brookings Institution Press, 2007.
The Weapons of Mass Destruction. Weapons of Terror Freeing the World of Nuclear.
Biological and Chemical Arms. Sweden: EO Grafiska, Stockholm, 2006.
Yann Aubin and Arnaud Idiart. Export Control Law and Regulations Handbook A
Practical Guide to Military and Dual-Use Goods Trade Restrictions and Compliance.
The Netherlands: Kluwer Law International,2007.
Electronic Media
Cynthia Lian, Shearn Delamore & Co, “Malaysia: Transit and Transhipment of Dual-
Use Items 2012”,https://www.worldecr.com/wpcontent/uploads/2012/07/Malaysia.pdf
Department of Foreign Trade of Thailand, ‘Examples of WMD-Related Strategic”,
http://web.dft.go.th/Portals/2/ContentManagement/Document_Mod638/8%20Exampl
es%20of%20WMD-Related%20Strategic%20 Commidities%20(Eng) @25541019-
1121508107.pdf.
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110
European Commission, “Trade: Dual-Use Export Control”,
http://ec.europa.eu/trade/import-and-export-rules/export-from-eu/dual-use-controls/.
Ministry of International Trade and Industry of Malaysia, “Strategic Trade Act 2010:
Frequently Asked Questions”, http://www.miti.gov.my/miti/resources/STA%2
0Folder/PDF%20file/FAQ.pdf?mid=280.
National Nuclear Security Administration, Department of Energy of United States of
America, “International Nonproliferation Export Control Program: Control Lists and
Approaches”,
https://csisprod.s3.amazonaws.com/s3fspublic/legacy_files/files/attachments/150624_
LodenPresentation.pdf.
Nuclear Threat Initiative. “United Nations Security Council Resolution 1540
Database”, http://www.nti.org/db/1540/ Official Portal of the Ministry of International
Trade and industry, “Prohibited and Restricted End User List”,
http://www.miti.gov.my/index.php/pages/view/3420.
Proliferation Security Initiative (PSI) , http://cns.miis.edu/inventory/pdfs/psi.pdf.
Star Enterprises, “Titanium Alloys”, http://www.starentps.com/titanium.html
Sunry Petroleum Equipment Co., Ltd., “Stream Heat Exchanger”
http://www.sunrypetro.com/steam_heat_exchanger.html
Wassennaar Agreement, http://www.wassenaar.org/introduction/index.html.
กระทรวงการตา่งประเทศ. “ข้อมลูเก่ียวกบัการตอ่ต้านการก่อการร้ายของไทย” ,
http://www.mfa.go.th/web/791.php.
กรมการค้าตา่งประเทศ. “การควบคมุการสง่ออกของไทย” ,
http://www.dft.moc.go.th/the_files/$$11/level14/2_Thailand%E2%80%99s_Export_C
ontrol_System_TH.pdf.
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_________________. “สาระส าคญัของพระราชบญัญตัิการสง่ออกไปนอกและการน าเข้ามาใน
ราชอาณาจกัรซึ่งสินค้า พ.ศ. 2522”,
http://www.dft.go.th/Seminar/law/Pholawbor2522.pdf.
Other Materials
Center for Information on Security Trade Control of Japan, Overview of Japan’s
Export Control (4th edn, 2015).
Charter of United Nations
Chen Yongquan, “Strategic Goods Control: Traders as Our Partners”.
Department of Foreign Trade, “Trade Management of Dual-Use Items: TMD/ Trade
Control of Weapons of Mass Destruction Related Items: TCWMD”.
Draft Trade Control of WMD Related Items Act approved by the Cabinet on 4
October 2016.
George Tan, “Export Controls”.
Import and Export of Goods Act B.E. 2522
Ministerial Notification of Ministry Specifies Dual-Use Items as Goods Requiring
Permission and Complying the Export Measures B.E.2558 (2015).
Mohamed Shahabar Abdul Kareem, “The Strategic Trade Act (STA) 2010:
Facilitating Trade in A Secure Trading Environment”.
Regulation (EC) No. 1334/2000.
Singapore Customs, “Strategic Goods Control and Self-Compliance”.
Singapore Customs, “Singapore’s Strategic Goods Control System”.
Sudarat Pongpitak, “Investment Promotion for Dual-Use Items” (2013).
United Nation Security Council Resolution 1540 (2004
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BIOGRAPHY
Name Ms. Piyanat Uamduang
Date of Birth August 19, 1984
Educational Attainment
2009-2013: Bachelor of Laws,
Thammasat University
2009-2013: Master of Laws (Criminal Laws),
Thammasat University
Work Position Litigation and Legal Compliance Specialist
(as Senior Manager Level)
Thai Yamaha Motor Co., Ltd.
Publications 2013: “Scope of Terrorism Offenses”
2017: “Export Control of Dual-Use Items: A
Comparative Study of Thai and Foreign Laws”
Work Experiences 2008-2011: Attorney
S&I International Bangkok Office Co., Ltd.