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Cablegate: Regional Chamber Officials Continue to Push Back On Iran

VZCZCXRO5764
OO RUEHAG RUEHBC RUEHDE RUEHDIR RUEHKUK RUEHLZ
DE RUEHDF #0021 1141411
ZNR UUUUU ZZH
O R 231411Z APR 08
FM AMCONSUL DUSSELDORF
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0136
INFO RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCNIRA/IRAN COLLECTIVE
RUCNFRG/FRG COLLECTIVE
RHMFIUU/DEPT OF JUSTICE WASHINGTON DC
RUEHDF/AMCONSUL DUSSELDORF 0152

UNCLAS DUSSELDORF 000021

SIPDIS

SIPDIS

PASS: P, T, E, EEB, NEA/IR, ISN, EUR/AGS

E.O. 12958: N/A
TAGS: EFIN ECON PTER PGOV KNNP ETTC MNUC PREL IR GM
SUBJECT: REGIONAL CHAMBER OFFICIALS CONTINUE TO PUSH BACK ON IRAN
SANCTIONS

REF: BERLIN 333

Sensitive but Unclassified -- Not for Internet Distribution

1. (SBU) As part of the Mission's ongoing dialogue with the
German business community on Iran-related issues, EMIN, CG and
Pol/Econoff met with a senior Duesseldorf Chamber of Commerce
(IHK) official on April 17, who expressed "fear" that the German
government and the Federal Agency of Economics and Export
Controls (BAFA) are "overreacting" on sanctions. Expressing
doubt that sanctions will ever influence Iranian behavior, the
official stated that they "affect German businesses more." EMIN
countered that the U.S. and Germany have been pursuing a
dual-track approach towards Iran since 2006 and that economic
sanctions are an important tool that supplements our ongoing
diplomacy efforts.

2. (SBU) The official, alluding to recent (inaccurate) German
press reports that claim the USG looks the other way when
American firms trade with Iran, noted that the Chamber wants to
see all firms held to the same standard. Exceptions to current
rules, he said, create an uneven playing field. EMIN responded
that the USG investigates every allegation of a U.S. company
illegally doing business in Iran -- including through
foreign-owned subsidiaries -- and appreciates leads from all
sources. Although the U.S. does not exercise extraterritorial
control over foreign-owned subsidiaries of U.S. companies, a
U.S. parent company could be held accountable if it knowingly
permitted a subsidiary to engage in trade of prohibited goods
with Iran. EMIN requested that the Chamber contact the Mission
with any information on U.S. businesses that appeared to be in
violation of U.S. laws and regulations so that the case can be
investigated.

3. (SBU) Comment: These remarks reflect a rather widespread,
and misguided, sentiment among small and medium sized
enterprises in Germany, of whom the Chamber of Commerce
Duesseldorf represents a significant number. In March, EMIN
engaged in a two-hour discussion on Iran sanctions with the
German (federal) Chamber of Commerce in Frankfurt, in which
representatives of German companies working in Iran trotted out
similar arguments and allegations. As in this case, we rarely
hear of any concrete evidence (other than that consumer goods
with American logos are available in some Iranian shops), and
have never received any leads, despite actively soliciting them.
Chamber officials are focused first and foremost on protecting
market share and employment levels in their district, and
Iranian trade is a significant factor for some of their members.
Our sense is that this segment of the business community does
not feel that they should be responsible for implementing
foreign policy. Mission Germany and ConGen Duesseldorf continue
to engage the business community to address misperceptions and
to sensitize them to the threat posed by a nuclear-armed Iran.

4. (U) This message was coordinated with Embassy Berlin.

BOYSE

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