“Sanctions on luxury goods can really hurt political elites”

Auditing officer John Hoppers explains why certain international trade bans are aimed at dictatorial regimes.

In the service of the Ministry of Foreign Affairs, Dutch Customs monitors compliance with sanctions legislation and the Strategic Goods Decree. Auditing officer John Hoppers explains why trade restrictions also apply to certain luxury goods. “Think, for example, of racing horses, exclusive sports cars and yachts.”

“The international community can impose strict trade restrictions on all kinds of entities, such as persons, businesses, regimes and countries”, John Hoppers, auditing officer, begins. “Nine times out of ten, it’s the United Nations who adopt a resolution in that respect. The European Union can then follow such a resolution and translate it into a regulation, which in the Netherlands is then ratified pursuant to the Dutch Sanctions Act 1977. The Ministry of Foreign Affairs is responsible for the policy of such regulations; Customs is responsible for the enforcement side.”

“In many cases, sanctions aim to hit the rulers of a certain country or area because, to put it euphemistically, they show behaviour that is not experienced as particularly pleasant by the rest of the world. They violate human rights, for instance, they destabilise the political and military situation in their region or they have nuclear aspirations. By means of trade barriers, the UN tries to induce these kinds of leaders and their entourage to change course.”

“Sanctions are mainly aimed at trying to stop the distribution of so-called strategic goods. This refers to military goods but also to dual-use goods, which can be put to civil but also to military use. In other words, all kinds of objects which a regime could use to suppress its own people or to threaten and attack neighbouring countries. Both categories of goods are described in detail on lists that are often appended to sanctions ordinances. If a particular good is on such a list, it cannot be exported to the destination in question. Customs conducts very strict checks; for instance, we have risk profiles on our systems. If a customs officer encounters goods intended for a sanctions country – or a declaration thereof – all alarm bells go off. This colleague will then notify a specialist in his region, who in his turn will notify our Central Import and Export Office. When it suspects the cargo is suspicious, the office will stop the shipment and it will send someone from the national POSS* team to the market party that declared or wants to export the goods, as soon as possible. I conduct such business visits on a regular basis. I discuss my findings with our account manager and then we have various options. In the case of a serious violation, we can seize a cargo in consultation with the public prosecutor and start a criminal investigation.”

“What a lot of people don’t know is that all kinds of luxury goods also often fall under sanctions legislation. They too are on a list, which can differ considerably, depending on the sanctions country. The aim is to take away certain goods from the top layer within such a society. Examples include stimulants such as expensive wines and other exclusive drinks.”

* POSS team: Precursors, Strategic goods and Sanctions legislation

This interview also appeared in our recently issued overview ‘Dutch Customs in 2019’. Click here to read the full publication.

Navigate further, and also read ‘Expensive drinks for Damascus’.

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