Index of "International Narcotics Control Strategy Reports"
Index of "Treaties and Legal Information" ||
Electronic Research Collections Index ||
International Narcotics Strategy Report, April 1993
US Department of State
Bureau of International Narcotics Matters
Department of State Publication 10047
Released April 1993
The Report is for sale by the Government Printing Office,
Superindendent of Documents. Stock No.: 044-000-02370-9
This segment of the report covers Chemcial Controls, and Financial
Crimes and Money Laundering, Country Reports.
[EDITOR'S NOTE: Charts referenced to in brackets [ ] are
available only in hard copy of report.]
The procurement of chemicals necessary to manufacture drugs is one
of the few points where clandestine, criminal drug trafficking
intersects with legitimate commerce. Regulation of legitimate
commerce to deny traffickers the chemicals they need is one of our
most valuable tools in the battle against drug criminals.
To be effective, however, regulation must be uniform and
universal, it must not impose undue burdens on those involved in
legitimate commerce, and it must produce results that justify the
burdens it does impose. Otherwise, traffickers can turn to
unregulated sources of supply, and industry will resist the full
cooperation required for effective regulation.
In 1991, the US-chaired Chemical Action Task Force (CATF)
developed and gained widespread acceptance of a set of measures to
be incorporated into national chemical regulatory regimes. These
measures build on the chemical control provisions of Article 12 of
the 1988 United Nations Convention Against Illicit Traffic in
Narcotic Drugs and Psychotropic Substances, and their adoption
would generally exceed the requirements of the chemical control
provision of the Convention. In 1992, a number of countries
incorporated measures recommended by the CATF into their chemical
control systems. The European Community amended its chemical
regulation to conform to them. This became binding on Community
members on January 1, 1993. Japan, in mid-1992, adopted a
chemical regulatory regime based on the CATF measures. The Andean
cocaine producing countries and many other Latin American
countries have chemical regulatory regimes based on the CATF
measures and the more comprehensive Organization of American
States Model Chemical Regulations. Asian heroin producers have
partial systems incorporating some of the CATF recommmendations.
The challenge now is building the administrative structures to
implement these regimes; and the establishment of effective lines
of communication between governments to exchange the information
they collect, thereby enabling authorities to confirm the
legitimate end-use of proposed transactions in regulated
chemicals. Industrialized countries are best able to do this,
although most have not done so. Drug producing countries will
In 1992, work was begun on both aspects of the problem by two
working organized as a result of a conference on chemical control
held in Lyon, France in September 1991. An international working
group, led by the International Narcotics Control Board, has
prepared a set of practical guidelines based on the CATF measures
for governments to follow in drafting and implementing chemical
regulatory regimes. A second working group, chaired by the
French, has developed methods to share information contained in
the chemical data bases of individual governments and
To build on this base, information sharing between regulatory
agencies must expand. Material and training assistance must be
provided to less developed countries so they can implement their
systems and participate in this international effort. Procedures
must be established to identify changes that may be required in
chemical regulatory regimes to attack new methods of utilizing
chemicals and new diversion techniques, and to bring under control
chemicals being used as substitutes for regulated chemicals. A
policy framework has been established to accomplish these
objectives; the spirit of international cooperation, particularly
in the CATF, that facilitated building this framework must
continue to achieve them.
The central elements of any system to prevent the diversion of
precursor and essential chemicals from legitimate commerce to
illicit drug manufacture are the ability to verify the legitimate
end use of a proposed transaction in a regulated chemical, and the
authority to suspend a transaction if the legitimate end use
cannot be verified. Since the vast majority of chemicals diverted
to illicit drug manufacture move in international commerce,
verification requires the cooperation and exchange of information
between governments in chemical shipping, transit and receiving
countries. The shipping country must be able to confirm with the
receiving country the integrity of the buyer and the legitimate
requirement for the regulated chemical before it permits an export
shipment. Transit countries must prevent diversion from
authorized shipping channels while chemicals are on their
territories. Receiving countries should ascertain the competence
and integrity of chemical importers, as well as the purpose for
which the chemicals are being imported.
To participate effectively in this system, governments must have
compatible chemical control regimes that regulate the same
chemicals, collect the same information on proposed transactions,
and provide mechanisms for rapidly sharing this information.
The implementation of this system requires the full cooperation of
industry, which is being asked to participate in a governmental
program to prevent a crime. Not only must industry supply the
information required by competent authorities to verify the
legitimacy of transactions, it plays a vital role in identifying
and alerting authorities to suspect transactions. Close
cooperation between industry and enforcement authorities,
therefore, is essential.
The 1988 U.S. Chemical Diversion and Trafficking Act (CDTA)
provides the USG the enforcement authorities required to control
chemical diversion. Many other governments, primarily in Western
Europe, have until recently lacked these authorities and drug
criminals have been able to turn to them as sources of supply.
1992 Chemical Control Developments
The March 1992 INCSR reported that the US-chaired Chemical Action
Task Force (CATF), as mandated by the Group of Seven
Industrialized Nations (G-7), had developed a practical and
feasible set of measures to stem the diversion of chemicals to
illicit drug manufacture. These measures build on those contained
in Article 12 of the 1988 United Nations Convention against
Illicit Traffic in Narcotic Drugs and Psychotropic Substances.
They include provisions for regulating transactions in chemicals,
including record keeping, administrative surveillance, vigilance
by private operators, import and export licensing, and the
authority to suspend or seize shipments in the case of suspect
transactions. There are also procedures for sharing of
information between competent national enforcement authorities,
including the U.S., to verify the legitimacy of proposed
The twenty-seven members of the CATF, representing the major
chemical producing and transit countries, the major drug producing
countries and concerned United Nations and regional organizations,
have endorsed the measures ("the CATF recommendations"). They
were endorsed by the G-7 at its 1991 London Economic Summit.
In 1992, the USG continued its lead role in the CATF. Action was
completed on some important CATF recommendations, and significant
progress was made on others.
At its April 1992 meeting, the Commission on Narcotics Drugs of
the United Nations approved by the required two-thirds majority
the addition of ten chemicals to the tables of chemicals
controlled under the terms of the 1988 UN Convention against
Illicit Traffic in Narcotic Drugs and Psychotropic Substances.
This increases to twenty-two the number of chemicals controlled by
the Convention. The ten additional chemicals had been identified
by the CATF following extensive study by its Chemicals Working
Group. The USG as a party to the Convention and the CATF
Secretariat country prepared the documentation and submitted the
recommendation for their addition to the United Nations.
Two working groups established by a U.S. sponsored conference on
chemical control held in Lyon, France in September 1991, completed
their work in January 1993. The Secretariat of the International
Narcotics Control Board (INCB) chaired the first working group to
develop guidelines for chemical exporting, importing and transit
countries to follow in investigating shipments of regulated
chemicals. The guidelines are intended primarily to assist
countries with limited or no experience in establishing chemical
diversion control systems.
The second working group, under French chairmanship, studied the
form and content of the various international data bases in order
to develop procedures for exchanging regulatory and law
enforcement information between them. The group concluded it
would not be feasible to establish a new, centralized data base
that would include regulatory and intelligence information now
contained in the data bases of individual countries and
international organizations. Accordingly, it proposed the
establishment of an international data sharing network, and
recommended that the INCB serve as the gateway to the network.
A major effort was made in 1992 to have chemical regulatory
regimes based on the CATF recommendations established at the
national level. These regimes will provide the network of
compatible chemical control regimes necessary to effective
international chemical control. Chemical diversion control is
most effective when it is exercised prior to the shipment.
Denying a shipment keeps chemicals subject to diversion out of
international commerce where the opportunities for diversion
multiply during transit. It also relieves governments further
down the transaction chain from the difficult, dangerous and
expensive tasks of storing and disposing of frequently volatile
chemicals seized when diversion is discovered.
Therefore, initial emphasis has been placed on the leading
chemical producing countries with the following results.
-- The U.S. has added two chemicals to those regulated by the
CDTA so that all 22 CATF recommended chemicals are covered.
Legislation is pending in Congress to incorporate into the CDTA
other CATF recommendations. These include the registration of
handlers of precursor chemicals, and the inclusion of brokers and
dealers in the definition of regulated persons.
-- The Council of the European Communities on March 31, 1992,
amended the European Community (EC) chemical regulation to conform
with the CATF recommendations. This regulation became binding on
all EC members on January 1, 1993.
-- Japan, a CATF member, in mid-1992 adopted laws and regulations
incorporating the CATF recommendations.
Illicit drug producing countries have also moved swiftly to adopt
chemical regulatory regimes. The cocaine producing countries of
Latin America have been in the forefront in adopting regimes based
the CATF recommendations and the more comprehensive Organization
of American States (OAS) Model Chemical Regulations. Asian heroin
producing countries are moving more slowly. India and Pakistan
have some controls on acetic anhydride, a key chemical in heroin
manufacture, but other precursor and essential chemicals remain
uncontrolled. Thailand recognizes the need and value of chemical
control and is moving to establish a system based on the CATF
An emerging area of concern are the countries of Eastern Europe
and the newly independent states of the former Soviet Union. Many
of them have the capability to produce the precursor chemicals
used in the manufacture of synthetic drugs and the essential
chemicals used in heroin and cocaine manufacture, but lack the
administrative structures necessary to monitor or regulate this
DEA organized a conference in June 1992 to sensitize Eastern
European authorities to the problem. The European Community,
threatened most directly by synthetic drugs from the Eastern
Europe, has included prevention of chemical diversion among the
areas of cooperation included in the association agreements it has
signed with Czechoslovakia, Hungary and Poland.
The CATF met in plenary session May 13-14, 1992, in Washington,
D.C. to review progress in the adoption and implementation of its
recommendations, and to decide on its future role. The meeting
noted two fundamental factors central to a successful system to
prevent the diversion of chemicals to illicit drug manufacture:
-- Regulation must be universal. As long as there are unregulated
source countries for chemicals, drug criminals can turn to them to
obtain the chemicals they require.
-- The adoption of a chemical regulatory regime alone is
insufficient; there must be an administrative structure to
implement the regime. Such a structure includes properly trained
and equipped personnel; specified enforcement procedures; well-
established channels of communication between government and
industry, and internationally between enforcement agencies.
Although the cost of the bureaucratic structure required for
chemical control is relatively low, it can be beyond the means and
experience of many countries.
The foundation for achieving universal regulation has been laid.
There is a recognition that chemical regulation is feasible and
desirable, and there is an accepted set of measures to be
incorporated into a chemical regulatory system. The CATF has
served as a catalyst for this.
The effective implementation of these regulatory systems has not
been achieved, although progress has been made, particularly in
the Andean countries. Seizures of cocaine essential chemicals in
these countries have not increased significantly, but there are
anecdotal reports that cocaine traffickers are having more
difficulty meeting their chemical requirements, indicating less
overall availability of chemicals due to tighter regulatory
But they are getting chemicals, either through direct importation
and subsequent diversion or smuggling from neighboring countries,
or through recycling of chemicals. The regulatory systems being
adopted to identify and prevent fraudulent shipments before they
are made are not yet effective. The CATF recognized at its May
1992 Plenary Meeting that the implementation of these systems is
best achieved by appropriate national and international
The CATF also recognized that its objectives of gaining policy-
level recognition of chemical regulation as important counter-
narcotics tool, and in developing feasible measures for a
cooperative international chemical control system had been
achieved. The CATF, which has explicitly stated that it should
not be institutionalized, proposed to phase out in 1993 and
request appropriate United Nations organizations to assist in
promoting adoption of chemical regulatory systems by those
countries that have not done so, and assist those that have, as
required, with material and training assistance. This would
maintain the momentum the CATF has developed in gaining widespread
acceptance of chemical diversion control, and strengthen the
central role of the United Nations
in this effort.
Regional organizations have taken the lead in organizing and
conducting seminars and training programs to promote and implement
chemical regulatory systems. In 1992, the OAS conducted two
policy seminars to promote such systems and two training courses.
One policy seminar was held in Mexico City, May 6-8, 1992, and the
second in Buenos Aires, Argentina, September 22-25, 1992. Each
dealt with the measures needed to implement complementary chemical
regulatory regimes to prevent chemical
A delegation from the Commission of the European Communities
attended the Buenos Aires OAS seminar to explain the EC chemical
regulation, and to invite Latin American governments to work with
it in a cooperative program to ensure the legitimacy of chemical
transactions between EC countries and Latin America to prevent
The OAS training courses were held in Caracas, Venezuela and
Buenos Aires, Argentina. These are workshop programs for
enforcement officials conducted by U.S. Drug Enforcement
Administration and Royal Canadian Mounted Police experts. They
and the policy seminars were funded by the United Nations
International Drug Control Program from funds earmarked by the
The Pompidou Group, a Council of Europe organization founded to
promote intra-European cooperation on counternarcotics issues,
organized a meeting in September 1992, in Strasbourg, France, to
promote chemical diversion cooperation with East European, Baltic
and newly independent states governments. Twenty-one countries
and concerned international organizations attended. The meeting
highlighted the gap between Western European governments and the
others in their adoption of chemical control regimes and their
ability to implement them. Follow-up meetings are being organized
to mobilize Western European initiatives to address the gap.
The United Nations International Drug Control Program is
developing a pilot project, financed by the United Kingdom, to
assist a country to establish an effective chemical regulatory
regime. The project will cover all aspects of the regime from the
writing of laws and regulations to training of personnel for their
The adoption of chemical control regimes by major chemical
producing and transit countries, as well as the cocaine producing
countries of Latin America, is providing the legal framework to
stem chemical diversion to cocaine producing regions. The Asian
heroin producing countries do not have comparable systems, but
chemical producing countries still have the ability to monitor and
regulate shipments to heroin producing areas. The fact is,
however, that with the exception of the control exercised by the
USG under the US Chemical Diversion and Trafficking Act, much
commerce in cocaine and heroin essential chemicals remains
unregulated. Traffickers continue to receive supplies from
sources in Western Europe and Asia.
There is a lead time for regulatory systems to become effective.
1993 will be a year for implementing the recently adopted systems.
Western European sources should begin to close down, and
traffickers will turn increasingly to secondary sources such as
Eastern Europe, South America and Asia. Other countries with a
basic chemical industry can produce many of the essential
chemicals required for heroin and cocaine production.
Smuggling of essential chemicals into drug producing countries
from neighboring countries is a growing problem as the drug
producing countries become more effective in regulating their own
chemical trade. It is a particular concern when the adjacent
countries have chemical industries. Domestic commerce must be
regulated to ensure that locally manufactured chemicals are used
legitimately and not smuggled into neighboring countries.
Policy level attention, therefore, will continue to be required to
urge the adoption and implementation of chemical control regimes
by secondary chemical source countries and countries where
smuggling could originate. At the same time, action must be taken
to counter trafficker responses to more effective chemical
Already, traffickers are reacting to increasing controls by
recycling and, in a few documented cases, synthesizing chemicals,
and seeking new refining techniques that require different or
fewer chemicals. Solvents used in cocaine production, such as
ether, can be recycled five to seven times by relatively simple,
but dangerous, distillation techniques. (Cocaine traffickers are
little concerned about the welfare of lab workers.)
Synthesis involves the manufacture of a cocaine or heroin
essential chemical from other chemicals. It is a more much
complex process than recycling and will be possible only by more
Trafficker responses increase the urgency of effective chemical
regulation. Recycling means traffickers must be denied the
initial supplies of chemicals they require. New refining
techniques that require fewer chemicals create the same
requirement. Enforcement agencies and international organizations
must continue to be vigilant to the substitution of new chemicals
for regulated chemicals, or their synthesis from unregulated
chemicals. And they must move quickly to have the newly
identified chemicals included in the international network of
controls. The key to this will continue to be inclusion in the
chemicals covered by the 1988 UN Convention, coupled with the
flexibility in national laws to add newly identified chemicals
quickly to their lists of chemicals regulated.
(Note: Chemical control is a rapidly evolving area as countries
adopt and implement regulations based on their obligations under
the 1988 UN Convention, and their membership in the CATF, the OAS
and the EC. (See chart on page 20.) These country reports are
based on the most current information available for major drug
producing and chemical manufacturing and trading countries.)
The European Community has taken the lead in mandating the
measures to be incorporated into national chemical regulatory
systems of member states, in initiating channels of communication
with other chemical source countries and drug source countries,
and in assisting less developed countries implement their chemical
On March 31, 1992, the Council of the European Communities amended
the EC Chemical Regulation to incorporate the CATF
recommendations. This regulation became binding on the twelve EC
member countries on January 1, 1993. Among the control measures
included is the requirement that exports of certain essential
chemicals to cocaine and heroin producing areas, and chemical
transit countries, be contingent on prior notification to the
receiving state so it may disapprove the transaction, when the
receiving state requests this procedure. The EC has written 35
governments offering to establish such a requirement. As of mid-
October, it had received favorable responses from 14.
An EC delegation participated in the September 1992 OAS seminar in
Buenos Aires to brief Latin American governments on the EC
chemical control regulation. In June 1992, an EC expert visited
Southeast Asia to brief eight governments on the new EC chemical
regulation, to assess the situation and to lay the groundwork for
future cooperation. The EC is now planning a multi-country
training workshop on chemical controls for Southeast Asian
countries that will culminate in the signing of a formal
cooperation agreement with the Association of Southeast Asian
The EC also has earmarked $250,000 to provide chemical control
training for East European countries in 1993.
Belgium is primarily a transit country for European chemical
exports. As an EC member it was obliged to adopt chemical
controls in accordance with the EC chemical regulation. Belgium
is also a CATF member and has reported to the Task Force that it
has in place regulations based on the CATF recommendations.
France is an EC member and obliged to adopt the EC chemical
regulation. It had used its existing chemical control regulations
to cooperate in international efforts to prevent chemical
diversion. In the CATF, France chaired the Legal and Regulatory
Issues Working Group which developed the control measures that are
the basis of the CATF recommendations. In 1992, it chaired a
multilateral working group to develop procedures for the
information sharing required to implement the CATF
Germany is the world's leading manufacturer of pharmaceuticals,
and produces or sells virtually all types of precursor and
essential chemicals. The three leading chemical manufacturing
companies in terms of sales volume are German. Until now, Germany
has relied largely on voluntary measures requiring industry
cooperation to ensure the legitimacy of transactions in regulated
chemicals and to prevent diversion. Most companies cooperate with
this program. Germany has an arrangement with Colombia to provide
prior notification of transactions in five essential and precursor
As an EC member, Germany was obliged to adopt the EC chemical
regulation on January 1, 1993, which includes mandatory controls.
Germany is also a member of the CATF and has reported to the CATF
that it was increasing its budget in order to implement the
statutory export control system on regulated chemicals as of
January 1, 1993. However, chemicals produced in Germany continue
to be found in cocaine laboratories in the Andean countries.
Italy had in effect prior to January 1, 1993, chemical control
laws including the provisions of the new EC chemical regulation.
Under these laws, chemical shipments to, through and from Italy
are closely monitored. Italy is a member of the CATF and chaired
its Chemicals Working Group.
The Netherlands is a major transit and brokering country for
European chemical exports. It is an EC and CATF member and has
adopted chemical controls in accordance with the EC chemical
regulation and the CATF recommendations. The Dutch chemical
industry has in place a code of conduct to help identify
Spain, as an EC member, is adopting chemical controls in
accordance with the EC chemical regulation. It also is a CATF
Sweden, a member of the CATF, has established a working group to
study the CATF recommendations and the EC chemical regulation with
the intention of enacting new legislation early in 1993 which will
be harmonized as much as possible with the EC regulation. As part
of the Nordic initiative between police and customs authorities,
Sweden participates in a monitoring program for imports and
exports of the CATF recommended chemicals plus six others. It has
little chemical trade with heroin and cocaine producing countries.
Switzerland is a member of the CATF. Since June 1, 1991, it has
had a domestic precursor chemical control regime in force covering
46 chemicals, including most of those recommended by the CATF.
The Swiss Federal Council decided on March 9, 1992, to accept the
CATF recommendations, and the government intends to conform the
existing regime with the CATF recommendations and the new EC
chemical regulation. With regard to its exports, Switzerland
intends to follow the CATF recommendations.
Turkey has laws and regulations controlling trade in acetic
anhydride, a key chemical in heroin manufacture. It is not a
member of the CATF, but participated in the February 1992 CATF
meeting in Kuala Lumpur, Malaysia focusing on the application of
the CATF recommendations in heroin producing areas. At the
meeting, the Turkish delegation reported that it was confident
that controls on licit imports of acetic anhydride were preventing
diversion. The chemical, however, was entering the country
through illegal importation using mislabeling of contents and
altered manifests, and smuggling, primarily from Syria. Turkey
has not ratified the 1988 UN Convention and does not regulate
other essential chemicals covered by the Convention. Trade in
these chemicals is small. Turkey did respond positively to the EC
offer of prior notification of shipments of heroin and cocaine
The United Kingdom, as an EC member, was obliged by January 1,
1993, to adopt chemical control procedures in accordance with the
EC chemical regulation. It had successfully used existing
legislation to detect and eliminate domestic labs manufacturing
synthetic drugs. HMG collaborated in preparing the EC regulation
to incorporate the CATF recommendations, and has worked with its
EC partners in formulating a directive governing intracommunal
trade in precursor and essential chemicals. As a CATF member, it
has been active in promoting the objectives of the CATF. It
played the leading role in organizing, funding and chairing the
February 1992 CATF meeting in Kuala Lumpur, Malaysia, focusing an
the application of the CATF recommendations in areas where heroin
is produced. It organized a seminar in September 1992 under the
aegis of the Council of Europe's Pompidou Group to present the
CATF recommendations to member states who did not participate in
the Task Force, as well as to East European governments.
Argentina has a highly developed petrochemical industry and is a
major South American producer of precursor and essential
chemicals. It has in place chemical control legislation based on
the OAS Model Chemical Regulations and cooperates in OAS
initiatives to promote chemical regulation. In 1992, it hosted an
OAS policy-level seminar for chemical producing countries and a
training workshop for enforcement personnel. Argentina is a CATF
member that responded positively to the EC offer to provide prior
notification of cocaine essential chemicals.
Argentine chemicals, however, continue to reach Bolivian cocaine
traffickers. Joint Argentine-DEA investigations have revealed
that chemicals have been purchased legally in Argentina and then
transported to front companies in Bolivia. Chemicals are also
believed to be purchased for domestic use and smuggled into
Bolivia has three laws addressing the control of precursor and
essential chemicals. These laws incorporate the basic elements of
the CATF recommendations and the OAS Model Chemical Regulations.
It also has signed a bilateral agreement with the USG to
facilitate chemical regulation by exchanging information on
transactions in key cocaine essential chemicals. The Government
of Bolivia is an active participant in the CATF and it responded
positively to the EC offer to provide advance notification of
shipments of regulated chemicals.
Progress is being made in implementing these control regimes. The
lead agency, the National Bureau for Registration, Control, and
Regulation of Controlled Chemicals and Precursors, is receiving
USG (INM) technical and financial assistance. It has planned and
executed several major operations resulting in large lab seizures.
The agency also maintains a registry of all companies dealing in
regulated chemicals. To date, the records of over 800 companies
are being maintained in the registry, and a team of 20 civilian
investigators makes unannounced inspections of these companies and
their warehouses to determine if any regulated chemicals are being
diverted for illegal purposes. The U.S. Coast Guard is helping
the GOB establish a port safety program, including commerce
controls such as inspections for illegal chemicals. Despite these
advances in controlling licit commerce to prevent chemical
diversion, Bolivia remains vulnerable to chemical smuggling from
neighboring countries, primarily Argentina, Brazil and Chile.
Brazil is South America's largest chemical manufacturing country,
as well as a major country for the transit to Andean cocaine
producing regions of chemicals from non-Brazilian sources. It is
a member of the CATF, and it responded positively to the EC's
offer of prior notification of EC member shipments of regulated
Brazil has imposed some limited control over domestically
manufactured chemicals, but none over imported chemicals.
Chemicals destined for cocaine manufacture in other countries can
be exported easily, or they can be imported for domestic
consumption in Brazil and smuggled across Brazil's long Western
borders with Colombia, Peru and Bolivia.
Chemical control legislation consistent with the OAS Model
Chemical Regulations has been pending in the Brazilian Congress
for over a year. It may be passed in 1993, but the bureaucratic
structure to administer it will need to be established.
Under current legislation, chemical operators are reporting, on a
voluntary basis, any suspicious transactions involving ethyl
ether, acetone and acetic anhydride. Suspicious shipments can be
suspended. The law also requires firms handling regulated
chemicals to be registered and to maintain records on all
transactions involving them.
Chile is a major supplier of the essential chemicals used for
cocaine manufacture in Bolivia. It has little legislative
authority to combat this trade. The government recognizes the
problem and is moving to combat it. Comprehensive
counternarcotics legislation, including chemical control
provisions based on the OAS Model Chemical Regulations, is pending
in the Chilean Congress.
Colombia has chemical control legislation in place consistent with
the OAS Model Chemical Regulations. It also remains the world's
leading supplier of cocaine hydrocloride to the world markets.
Much of this is refined in Colombia from cocaine base flown in
from Bolivia and Peru, indicating traffickers are obtaining the
chemicals they require. The chemicals are legitimately imported
and subsequently diverted, illegally imported by mis-labeling, use
of front companies, etc, or smuggled in via land and sea routes.
The United States was the principal chemical supplier to Colombia
until 1989, when U.S exports dropped precipitously following
implementation of the U.S. Chemical Diversion and Trafficking Act.
Colombian traffickers were able to turn to other sources,
primarily in Western Europe, to replace the U.S. supplied
The Colombian Government is seeking to implement its chemical
legislation but lacks the resources to do so. It actively
participates in international chemical control initiatives such as
the CATF, where it contributes significant insights from the
perspective of a chemical importing and drug producing country.
Colombia has signed a bilateral chemical control agreement with
the USG and responded positively to the EC offer to provide prior
notification of shipments of cocaine essential chemicals. Germany
already provides prior notification of exports of five precursor
and essential chemicals. In return, Colombia sends Germany a
monthly copy of approved import licences for German vendors.
Ecuador has chemical control legislation based on the OAS Model
Chemical Regulations. It has been an active member of the CATF.
It has signed a bilateral agreement with the US to facilitate
regulation of chemical commerce with the United States and
responded positively to the EC's offer of prior notification of EC
member exports of regulated chemicals.
However, Ecuador lacks the administrative and enforcement
structure to fully implement these controls and to prevent the
smuggling of diverted cocaine essential chemicals to Colombia.
The Government of Ecuador has included enhanced chemical control
mechanisms in its 1992-97 National Plan developed by the National
Drug Council. It is actively seeking USG assistance in its
implementation. Among the proposed chemical control measures is a
survey of the legitimate requirements of domestic industry for
regulated chemicals to prevent the importation of excess amounts
that can be smuggled into Colombia.
Peru has in force chemical laws consistent with the OAS Model
Chemical Regulations. It has a bilateral chemical control
agreement with the US and has responded positively to the EC offer
of prior notification of shipments in regulated chemicals. Under
our bilateral agreement, US and Peruvian enforcement agencies are
informally exchanging information on a limited number of
chemicals. The government lacks the regulatory and enforcement
capacity to fully enforce its laws or to participate completely in
cooperative regulatory mechanisms with chemical source countries.
Cocaine essential chemicals, therefore, remain available to
traffickers, either through diversion from legitimate commerce or
smuggling from neighboring countries.
Venezuela has chemical control legislation before Congress based
on the OAS Model Chemical Regulations. It is using existing
authorities to cooperate with international efforts to prevent the
use of Venezuela as conduit for cocaine essential chemicals en
route to Colombia. In February 1992, Venezuela and the US
cooperated in seizing 68 metric tons of the cocaine essential
chemical methyl ethyl ketone being transported overland to Bogota.
In March 1992, Venezuela and the US signed a bilateral chemical
control agreement to facilitate further cooperation.
MEXICO AND CENTRAL AMERICA
Mexico has an important chemical industry. Diversion from this
industry is the primary source of chemicals used in the
manufacture of Mexican heroin. Mexico is not considered a major
source of chemicals for illicit drug manufacture in other
Mexico is not a member of the CATF, but it has adopted chemical
control regulations based on the OAS Model Chemical Regulations.
In May 1992, the OAS conducted a seminar in Mexico City on
Trafficking of Precursor and Essential Chemicals in Central
America and Mexico. The seminar dealt with the measures required
in the region to minimize chemical diversion in the context of the
1988 UN Convention and the OAS Model Chemical Regulations. Mexico
and DEA have begun sharing information on chemical control
procedures and chemical shipments. DEA also has assigned an
officer full time to our Embassy in Mexico City with the sole
function of tracking and liaison with Mexican authorities on
precursor and essential chemical diversion control.
Panama has chemical control laws consistent with chemical control
objectives of the 1988 UN Convention. It is not a significant
chemical manufacturing country, and chemical control is a
secondary enforcement priority to drug interdiction and money
laundering. However, under a bilateral chemical control agreement
with the US, the government has cooperated fully in providing
information on companies suspected of transporting precursor and
essential chemicals through Panama for illicit purposes.
The Bahamas is not a major chemical producing or transit country.
It is not a member of the CATF. In 1992, the government did
implement regulations to control the importation and exportation
of precursor and essential chemicals as called for in Article 12
of the 1988 UN Convention. The regulations cover the 22 chemicals
listed in the Convention plus an additional 25 substances known to
be used in illicit drug manufacture.
The Dominican Republic regulates its limited trade in precursor
and essential chemicals under provisions of the Drug and Substance
Control Law of 1988, as amended in 1990. In order to import,
manufacture, or use drug related chemicals, a company must obtain
a license from the Ministry of Public Health and Social
Assistance. Records of all licenses and import/export
certificates are maintained by the Ministry and are shared with
USG officials as required for investigative purposes. The
Dominican Republic is not a member of the CATF.
Jamaica does not have legislation regulating the use of precursor
and essential chemicals. However, Jamaica has a sophisticated
import/export monitoring and information-retention computer
program under Jamaica Promotions (JAMPRO). Through JAMPRO,
Jamaica has initiated a chemical control program patterned after a
DEA program that monitors the flow of drug-related chemicals into
and within the country. Jamaica is not a member of the CATF.
India manufactures seven of the most important heroin essential
chemicals. The Government has controls on acetic anhydride within
50 kilometers of the Pakistani border and 100 kilometers of the
Burmese borders. Export of the chemical is banned. Internally,
the Government is establishing a requirement for companies to
report their utilization of acetic anhydride. These controls have
reduced but not eliminated smuggling across both borders. There
also is some regulation of acetone, diethylether and chloroform,
but the Government's general attitude is that essential chemicals
have a wide range of legal industrial uses and any attempt to to
regulate them will create additional problems. This facilitates
the supply of essential chemicals to illicit domestic drug
manufacture. India is a member of the CATF and in discussions
there it has noted that the Government intention to privatize much
chemical production capacity further complicates regulation.
Pakistan in 1991 placed controls on imports of acetic anhydride, a
key heroin essential chemical, and criminalized its unlicensed
import, manufacture and use. The Pakistani delegation to the CATF
heroin chemical meeting in Kuala Lumpur stated that acetone and
acetic acid are subject to the same controls, although they are
not on the restricted list. There is limited domestic production
of these three chemicals, but it is not as rigorously regulated.
Smuggling is believed to provide most of the chemicals required by
the heroin labs in the tribal areas along the Pakistan/Afghan
border. India is the primary source, although some chemicals may
come from Central Asia and and Western and Eastern Europe
Burma has not enacted specific chemical control legislation, but
the country's narcotics legislation provides the necessary
authority for action against trafficking and possession of
precursor and essential chemicals. In 1992, authorities seized
1237 gallons of acetic anhydride. Enforcement efforts are
hampered by the fact that most chemicals used illicitly in the
country are smuggled in from India and China, rather than imported
commercially and diverted. A Burmese delegation attended the
Kuala Lumpur heroin chemical meeting and stressed the country's
problems with smuggling. Burma responded positively to the EC
offer of prior notification of shipments of heroin and cocaine
Malaysia is not a member of the CATF but it hosted a CATF expert
meeting on heroin chemicals in February 1992. It has not adopted
chemical controls in accordance with the CATF recommendations, but
it does control by licensing the importation and distribution of
acetic anhydride. Since heroin production is negligible in
Malaysia, there is little domestic diversion. There is evidence
that acetic anhydride may be sold or exchanged with traffickers in
Thailand and Burma. Some acetic anhydride produced in Indonesia
also reportedly passes through Malaysia en route to heroin
traffickers in Thailand and Burma.
Singapore is not signatory to the 1988 UN Convention. However, it
prohibits the domestic possession, consumption or sale of the
chemicals listed in the Convention except under strictly
controlled license. With these controls, chemical diversion does
not appear to be a serious problem within Singapore. Similiar
controls are not imposed on the resale and transhipment of
precursor and essential chemicals to third countries, but
authorities cooperate with Embassy Singapore's DEA Country Office
to monitor such activity in accordance with the U.S. Chemical
Diversion and Trafficking Act. Singapore accepted the EC offer of
prior notification of shipments of heroin and cocaine essential
Thailand is a member of the CATF and has reported to the Task
Force that is establishing a working group to draw up steps to
implement the CATF recommendations. At present, there are few
controls over precursor and essential chemicals, and only a
limited ability to enforce the controls that do exist. Heroin
essential chemicals acetic anhydride and acetyl choride are
included among controlled substances in the 1979 Narcotics Act.
Ether and chloroform are controlled under the 1952 Commodities
Control Act and cannot be shipped without a permit into the
While a few significant chemical seizures were made in 1992,
authorities have difficulty differentiating between chemicals
intended for legitimate industrial use and those intended for
illicit drug manufacture. There is also evidence that traffickers
are synthesizing heroin-essential chemicals from unregulated
chemicals. Smuggling is an additional problem. Thai authorities
have reported to the CATF two principal suspected routes for
smuggling into northern Thailand, from China via Burma and from
India via Burma.
China, under a law adopted in 1988, regulates the sale,
distribution and import/export of certain precursor and essential
chemicals, including three listed in 1988 UN Convention. During
the first half of 1992, the government seized 41,952 kilograms of
drug-related chemicals. The government is considering a proposal
to put under control the other chemicals listed in the Convention.
China is a member of the CATF and has participated in most of its
meetings, including the special February 1992 CATF Heroin Chemical
Meeting in Kuala Lumpur, Malaysia.
The chemicals covered by the 1988 law include acetic anhydride, a
key heroin chemical. In addition to domestic controls, acetic
anhydride produced or sourced in China cannot be legally exported.
There are reports of smuggling to traffickers outside China,
particularly heroin traffickers in the Golden Triangle.
Hong Kong is not a major chemical or drug manufacturing area. It
regulates to varying degrees eight of the 22 chemicals listed in
the 1988 UN Convention. Four of these are precursor chemicals
used in the manufacture of synthetic drugs and they are controlled
under the Pharmacy and Poisons Ordinance. Four are essential
chemicals used in heroin and cocaine manufacture. The most
important is acetic anhydride, controlled stringently under the
1975 Acetylating Substances Ordinance. This ordinance played a
major role in surpressing heroin manufacture in Hong Kong.
Hong Kong is a free port and a major regional transit point for
chemicals in the area. Some licensing control is exercised over
this trade, but verification of legitimate end-use is not
required, so subsequent diversion is possible. Hong Kong
participated in the February 1992 CATF Heroin Chemical Meeting
where its delegation reported that in 1990 Hong Kong imported
110,105 tons of the 22 chemicals listed in the 1988 UN Convention,
and re-exported 78,647 tons or 71 percent. One hundred percent of
the acetic anhydride imported was re-exported to China. The U.S.
was the source of 73 percent of this.
Japan, a major chemical producer, has achieved great progress in
the past year in chemical control. It is a member of the CATF,
and at the February 1992 CATF Heroin Chemical Meeting in Kuala
Lumpur announced it intended to adopt the CATF recommendations by
mid-year. In May of 1992 the precursor chemical control law was
enacted accomplishing this. Since then, responsibility for
monitoring precursor and essential chemical transactions has been
transferred from the the Ministry of Health and Welfare to the
Ministry of International Trade and Industry (MITI) which has
rigorously enforced the new requirements. Embassy Tokyo's DEA
Country Office has had excellent cooperation from MITI in
recording and tracking movements of regulated chemicals.
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