13 October 2014
Alibaba's compliance challenge, part II: Iranian nuclear procurers
At least five Iranian companies designated by the European Union and other sanctions regimes for supporting Iran’s nuclear programme are advertising as suppliers on the NYSE-listed Alibaba Group’s Internet trading platform alibaba.com, Project Alpha has discovered.
A listing on alibaba.com belonging to EU-sanctioned company Raad Automation
The EU has designated four of the five Iranian companies – Ashtian Tablo, Neka Novin, Raad Automation and Yasa Part – for their involvement in construction or procurement activities for Iran’s uranium enrichment programme. A fifth entity, the Iranian Offshore Engineering and Construction Company, was originally sanctioned by the EU for involvement in the construction of Iran’s Fordow uranium enrichment facility, but was then re-listed under different criteria after successfully challenging its designation in court.
As well as being subject to EU sanctions, each of these five companies are also designated under various other autonomous sanctions regimes, including those of the US, Canadian, Japanese and Australian governments.
As Project Alpha has suggested, Alibaba Group should quickly introduce proactive screening mechanisms to prevent sanctioned entities from listing on the company’s various sites.
UPDATE: As of 9 October, Iranian Offshore Engineering and Construction Company, Neka Novin, Raad Automation and Yasa Part are no longer on alibaba.com. Ashtian Tablo remains, however.
UPDATE: As of 13 October, Ashtian Tablo is no longer on alibaba.com.
1. Electrical switchgear supplier Ashtian Tablo was sanctioned by the EU for involvement in construction of Iran’s underground uranium enrichment facility at Fordow. Ashtian Tablo has also been sanctioned by Japan, Canada and Australia.
2. Oil/gas company the Iranian Offshore Engineering and Construction Company, was originally sanctioned by the EU for involvement in the construction of the Fordow nuclear facility and re-listed after a court appeal as a financial supporter of the Iranian government. IOEC has also been designated by the Australian, Canadian and Japanese governments.
3. Electrical equipment supplier Neka Novin was sanctioned by the EU for ‘involvement in procurement of specialist equipment and materials with direct application in Iran’s nuclear programme.’ Neka Novin has also been sanctioned by the US, Canadian, and Japanesegovernments.
4. Frequency inverter supplier Raad Automation, also known as Raad Iran was sanctioned by the EU for buying inverters for Iran’s uranium enrichment programme. It has also been sanctioned by the Japanese government.
5. Trading company Yasa Part was sanctioned by the EU for ‘dealing with procurement activities related to the purchase of materials and technologies necessary to nuclear and ballistic programmes.’ Yasa Part is also subject to US, Japanese and Canadian sanctions.