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U.N. Charter: Chapters 6 and 7

In 1990, shortly after Saddam Hussein’s forces entered Kuwait on the 2^nd August, the United Nations Security Council adopted Resolution 660 condemning the attack and calling for the immediate recall of Iraqi troops. Shortly afterwards, on the 4^th August 1990, the Security Council approved Resolution 661, the first of a wave of Resolution, which imposed wide-ranging sanctions on Iraq and Iraqi-controlled Kuwait, including: punitive economic sanctions, largely targeted at the finance and oil and gas sectors; an arms embargo; and other trade restrictions. All of these Resolutions were passed under Chapter 7 of the UN Charter, which authorises action for peacekeeping and against acts of aggression. After the fall of Saddam Hussein in 2003, a further Resolution, 1483, was adopted, against under Chapter 7, reducing most of the trade restrictions, but freezing assets and designating entities related to Saddam Hussein and his former government, such as The Central Bank of Iraq and TDG Ltd. (a UK registered company). The arms embargo, Iraqi obligations to restore Kuwaiti citizens and property, and disarmament obligations were maintained.

Ban Ki-moon’s Recommendation

Many of the outstanding issues with regards to UN sanctions on Iraq relate to missing Kuwaiti people and property, whilst many others have been resolved. The oil and gas sanctions were officially lifted in 2010 when the administration of the country’s oil resources was returned to the Iraqi government. Ban Ki-moon’s recommendation is to address the outstanding humanitarian issue of missing Kuwaiti persons and property. This issue would cease to be implemented under Chapter 7 of the U.N. Charter (Nb. ‘Action with Respect to Threats to the Peace, Breaches of the Peace, and Acts of Aggression’) and instead the UN would use Chapter 6 of the Charter, which regulates the ‘Pacific Settlement of Disputes’. Thus, the only Chapter 7 issue outstanding would then be the compensation package of $11 billion owed to Kuwait by Iraq.

What this means for UK Trade

It is a common misconception that UK businesses should not be exporting to, or investing in, Iraq. Restrictions on arms still exist, as do restrictions on designated entities, under UN, EU and US sanctions. At the same time, there are numerous opportunities in the country and UKTI focusses in particular on, amongst others: the oil and gas; telecommunications and security sectors.[1] UK businesses should consult the UKTI website and relevant designated entity lists for further information.