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It is easy to understand why the UN would wish to restrict nuclear proliferation by using sanctions. Speaking at the Greek British Shipping Forum recently, it was a chance to share views. When commerce talks about managing sanctions, it usually means coping and not making a mistake. Authorities and regulators do not talk about managing or harmonizing sanctions, so they tend to multiply, resulting in ever more complexity and expense for industry. For insurers and brokers, there is a fundamental need for due diligence amidst a constantly evolving regulatory backdrop.
Much has been said about the use of AIS, but duplicated vessel monitoring without enforcement cannot deliver the UN’s aim of stopping oil to North Korea. Somewhat inexplicably, the more reliable LRIT data, which is available to flag states who could intervene, is hardly mentioned.
A useful comparison could be made with the Somalian emergency which required a naval presence, embarked legal advisers, and a unified will to work against pirates in the interests of world trade. With North Korean sanctions, there is no naval presence, indirect legal enforcement, variable will and the result works against world trade as legitimate operators are faced with more checks and complications.
Insurers and brokers are subject to a strict liability regime that has strong measures against inadvertent breaches but seems to produce little effective action against those who deliberately evade the rules. Insurers have no constabulary powers, and without political and/or military support they are not able to resolve political problems.
These elements do not bode well. In maths, if an equation produces the wrong outcome, it is reworked. If, as seems likely, the use of sanctions has reached the limits of effectiveness, a neutral assessment might deduce it is time for regulators to readdress the strategic calculation. For now, if you think compliance is expensive, try non-compliance.