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US DEPARTMENT OF STATE
BUREAU OF INTERNATIONAL NARCOTICS MATTERS

INTERNATIONAL NARCOTICS CONTROL STRAGEGY REPORT
APRIL 1994



CHEMICAL CONTROLS


Introduction

The regulation of commerce in major precursor and essential chemicals to prevent their diversion to illicit drug manufacture became increasingly accepted during 1993.  At the same time, the difficulty of effective action to deny chemicals to traffickers became more apparent.

A precursor chemical is one used in the manufacture of synthetic drugs, and in the manufacturing process it becomes part of the resulting drug.  An essential chemical is one used in the refining of coca and opium into cocaine and heroin.

Synthetic drugs can be manufactured in relatively simple labs requiring small quantities of chemicals.  Therefore, the labs can be set up close to the drug markets, and traffickers can obtain most precursor chemicals by diversion from domestic commerce.  Since most precursor chemicals used in synthetic drug manufacture are legitimately used in the manufacture of pharmaceuticals, they are traded in pharmaceutical quantities and regulated domestically by many countries as pharmaceuticals, facilitating diversion control.  The 1961 Single Convention, as amended by the 1972 Protocol, the 1971 Convention on Psychotropic Substances and the 1988 United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988 UN Convention) provide the framework for international cooperation in the regulation of precursor and essential chemicals.

Unlike precursor chemicals, essential chemicals have extensive commercial uses.  Hydrochloric acid, for example, which is used in the refining of coca and opium, is one of the most widely traded chemicals in the world.  There are multiple sources for essential chemicals and they are in constant movement throughout the world in vast quantities.  The 1988 UN Convention provides the framework for international cooperation in their regulation.

Effective, cooperative chemical diversion control has the following advantages. 

--By denying the raw materials for synthetic drug manufacture, and the chemicals required for cocaine and heroin manufacture, chemical diversion control stymies synthetic drug manufacture and has an impact on cocaine and heroin manufacture equal to denying coca or opium.

--It is cost-effective, requiring a relatively modest administrative structure.

--It exposes law enforcement personnel to less danger than most other enforcement strategies.
 
International attention and cooperative efforts are imperative to prevent the diversion of essential chemicals--those chemicals which are most recently regulated and most subject to diversion by virtue of the large volume of international commerce in them.  Furthermore, international cooperation in implementing universal systems to prevent diversion of essential chemicals is indispensable to preclude traffickers from turning to chemical suppliers in countries without adequate regulations.

1993 Chemical Control Developments

The essential elements of a chemical diversion control strategy are the verification of the legitimate end-use of a proposed transaction in a regulated chemical before shipment, and the authority to suspend the transaction if legitimate end-use cannot be confirmed.  While simple in concept, realization of effective diversion control must overcome three fundamental hurdles, particularly with regard to international commerce in essential chemicals having widespread commercial uses.

--The feasibility of regulating international commerce in commercial chemicals in a manner that will prevent diversion without requiring a large and expensive enforcement structure, or unduly burdening legitimate commerce, must be demonstrated and accepted.

--Common procedures for diversion control must be developed and agreed upon.

--These procedures must be uniformly and universally implemented.

We entered 1993 halfway over the second hurdle and ended it on the other side.  Article 12 of the 1988 UN Convention provides the framework for international cooperation in chemical diversion control.  In 1990, the Group of Seven Economic Summit Partners accepted the US proposal to mandate a Chemical Action Task Force (CATF) to develop practical procedures for governments to follow in controlling chemical diversion as called for in Article 12.

Twenty-four governments, representing the major chemical producing, chemical transit and drug producing countries,  and three concerned international organizations, participated in the CATF (Argentina, Australia, Belgium, Bolivia, Brazil, Canada, China, Colombia, Ecuador, France, Germany, Hungary, India, Italy, Japan, The Netherlands, Pakistan, Peru, Spain, Sweden, Switzerland, Thailand, United Kingdom, United States, the Commission of the European Union, the International Narcotics Control Board, and the Organization of American States).  The US Deputy Attorney General chaired the CATF, and the USG provided its secretariat.

With USG leadership, the CATF successfully obtained its objectives.  It developed a consensus that regulation of commercial chemical transactions was feasible, and it agreed upon recommended procedures building on the chemical control provisions of the 1988 Convention for a common approach to regulation.
 
The April 1993 meeting of the United Nations Commission on Narcotic Drugs (CND) adopted a resolution introduced by the United States and co-sponsored by many CATF member governments calling upon all governments to establish effective measures to implement the chemical control provisions of the 1988 UN Convention, "taking into consideration the recommendations contained in the final report of the Chemical Action Task Force."

The same resolution requested the United Nations International Drug Control Program (UNDCP) "to provide financial, technical and material assistance, including training, and to coordinate assistance that international and regional organizations may provide, in the implementation of chemical control regimes."  It also calls upon governments "to contribute fully to and utilize the databases that are being established [by the International Narcotics Control Board (INCB) and other national and international organizations] to prevent the diversion of chemicals, subject to their domestic law."

The adoption of the US resolution by the Commission on Narcotic Drugs and its subsequent approval by the United Nations Economic and Social Council achieved the following:

--promoted uniformity in chemical regulation by urging governments to consider fully the CATF recommended procedures as they establish the chemical control measures required by the 1988 UN Convention;

--recognized the need for financial, technical and material assistance, including training to implement chemical control regimes; 

--strengthened the central role of UN organizations in chemical control by

     --requesting UNDCP to provide chemical control assistance and to coordinate the assistance provided by others, and

     --noting the central role that the INCB has in accumulating and disseminating the information required for effective chemical diversion control; 

     --allowing the CATF to phase out as an organization, thereby avoiding institutionalization of an ad hoc bureaucracy.

In effect, the resolution documented the international community's success through cooperation in the CATF and the CND in overcoming the first two hurdles to effective regulation to prevent chemical diversion from international commerce, laid the foundation for the crucial phase of concrete implementation of chemical control regimes based on the CATF recommendations, and eliminated the expense of an on-going task force and more meetings.  In the implementation phase, the United States will increase its emphasis on multilateral cooperation in chemical diversion control, and on providing assistance to developing countries subject to the requirement that they establish and implement control regimes.
 
Implementation of Chemical Controls

Even before adoption of the US resolution by the CND, considerable progress had been made in the implementation of chemical controls.  In 1989, the United States implemented the 1988 Chemical Diversion and Trafficking Act, which authorizes an excellent system for chemical diversion control based on the verification of legitimate end-use prior to shipment of regulated chemicals.  In 1993, two additional chemicals were included in the US law's provisions, thereby bringing under US regulation all chemicals included in the 1988 UN Convention and recommended for control by the CATF.

In 1990, the Organization of American States (OAS) approved a strict model chemical regulation negotiated under the auspices of the Inter-American Drug Control Commission (CICAD).  A program to assist governments to adopt the regulation was launched in 1991.  Currently, the Andean cocaine producing countries and other important Latin American countries have adopted legislation based on the OAS model and the CATF recommendations.

Developed chemical producing countries are adopting comparable systems.  Japan, in 1992, adopted chemical regulations in conformity with the CATF recommendations.  On January 1, 1993, the European Union (EU) chemical regulation conforming with the CATF recommendations came into effect.  It is binding on the twelve EU member states, which, together with the United States, represent the world's largest chemical manufacturing and trading countries.

In addition to the Commission on Narcotic Drugs resolution, the United States in 1993 undertook a number of bilateral and multilateral initiatives to promote and assist the adoption and implementation of effective chemical control regimes based on the CATF recommendations.

In June 1993, the Drug Enforcement Administration (DEA) hosted a major Conference on Chemical Operations in Rome with participation by police, customs and regulatory officials from 49 governments in Western and Eastern Europe, the Newly Independent States of the former Soviet Union, Latin America, and Asia.  The Commission of the European Union provided $65,000 to help fund the conference and assisted with its organization.  The conference's primary objective was to identify the urgent actions that governments must undertake now to translate the chemical control regimes which governments are adopting into an international network of cooperation that will effectively stem chemical diversion.

In September 1993, DEA, with INM funding, organized a two-day senior level chemical control seminar and a five-day training course on the practical aspects of implementing a chemical control regime for the countries of Southeast Asia.  The seminar and training course were held in Bangkok with the cooperation of the Government of Thailand.  The Governments of France and Germany provided enforcement officials to instruct on the chemical control regimes being adopted by EU countries in accordance with the EU chemical regulation.
 
The USG in 1993 continued through its contribution to UNDCP to fund chemical training activities conducted by the OAS.  In February 1993, a subregional chemical control seminar was held in San Pedro Sula, Honduras for the countries of Central America, Mexico, Panama, and the Dominican Republic.  A training seminar/workshop was held for the English-speaking countries of the Caribbean, Belize, Guyana, and Suriname in Trinidad and Tobago in May 1993.  The OAS and UNDCP jointly sponsored a training course for sixty Ecuadorean officials in Quito in September 1993.  The Royal Canadian Mounted Police and DEA provided instructors for the course.  In addition to the training provided, the OAS courses are used for the testing by enforcement personnel of laboratory equipment developed by UNDCP for the identification of precursor and essential chemicals.

Chemical Sources and Diversion Patterns

Only the US system based on the Chemical Diversion and Trafficking Act has been in force long enough to be effective in identifying and suspending transactions in chemicals liable to diversion.  This has resulted in the following:

--disapproval of sixty percent of Colombian importers of US-origin chemicals;

--fifty percent cut in US essential chemical exports to Colombia;

--twenty-five percent of Latin American importers of US-origin chemicals disapproved; and 

--twenty-three shipments totalling 2000 metric tons halted.

As the impact of the US law was felt, the inevitable happened, and Andean cocaine traffickers turned to other sources of supply, primarily European, to replace the essential chemicals the United States had been providing.  The European control systems have not been in effect long enough to alter substantially this situation, although they have been used to suspend some suspected shipments based on information shared between DEA and European enforcement agencies.

Cocaine traffickers obtain their chemicals through a variety of routes.  As diversion is a clandestine activity, it is impossible to determine the magnitude of each route.  The following are some of the most common.

--Chemicals are imported legally into the drug producing country with a valid license issued either to a front company, or to a legitimate company, and subsequently diverted.  In this case the importing country does not adequately investigate the legitimate end-use of the chemicals before issuing its import license, and the exporting country makes no independent effort to ensure legitimate end-use, accepting the import license at face value.
 
--Chemicals are imported into a neighboring country, diverted by traffickers, and smuggled into drug manufacturing countries.  Venezuela, Ecuador and Chile are conduits to Colombia, Peru and Bolivia for smuggled chemicals.  This is because the conduit countries do not adequately investigate legitimate end-use before allowing imports, nor do the exporting countries ensure the legitimate end-use of regulated chemical exports before authorizing shipment.

--Chemicals are manufactured in neighboring countries, diverted from domestic commerce, and smuggled into drug producing countries.  Brazil, sharing common borders with Colombia, Peru and Bolivia, is an important source.  Argentina, sharing a border with Bolivia, is a source of chemicals for that country.  Inadequate internal controls make this type of diversion and smuggling possible.

In addition, traffickers are re-cycling chemicals.  By a relatively simple distillation process, solvents used in drug manufacture can be re-cycled five to seven times.

The United States has not been a major supplier of essential chemicals to Southeast and Southwest Asia heroin manufacture and the traditional sources remain.  These include diversion of legal chemical imports from Asia and Europe, and smuggling from China, India and Thailand into Burma, and from India and Afghanistan into Pakistan.

Heroin manufacture in the Golden Triangle of Southeast Asia is centered in Burma.  Smuggling directly from chemical manufacturing countries such as China and India is believed to be the major source of chemicals for this manufacture.  Chemicals are also smuggled through Thailand into Burma or legally imported into Thailand, diverted, and then smuggled into Burma.  There is some diversion from legal imports into Burma, although this is believed to be a less significant source.

Heroin manufacture in the Golden Crescent of Southwest Asia is centered in the Northwest Frontier Province of Pakistan.  Smuggling, either from Afghanistan or India, is considered the principal source of essential chemicals for this manufacture.  The chemicals smuggled into Pakistan from Afghanistan probably originate in Western and Eastern Europe and are transported in a reverse flow on the overland smuggling routes for heroin to these areas.  The chemicals smuggled from India are primarily of Indian manufacture.  Pakistani production, and imports of essential chemicals into Pakistan, are limited and monitored by the Pakistani Government.  Although the effectiveness of the monitoring has not been tested, the amount of local production and legitimate imports is relatively small, supporting the assumption that smuggling is the traffickers' primary source of chemicals.

Chemical Diversion Law Enforcement Response

The challenge to chemical diversion control now is to make effective the control regimes that have been adopted, and to expand chemical control to alternative source countries.  The key to effective implementation of control regimes is for governments to exercise forcefully the authorities contained in their own laws and regulations to identify and suspend suspicious shipments.
 
It is the responsibility of chemical exporting countries to undertake active efforts to insure that regulated chemicals which they export are to be used for legitimate purposes.  Chemical importing countries have a corresponding responsibility to cooperate actively by verifying the legitimate end-use of regulated chemicals before issuing licenses for their importation.  However, it must be emphasized that major responsibility in this process rests with the exporting country, and that the exporting country cannot rely on mere issuance of an import permit to determine that a transaction is legitimate.

At the same time, greater emphasis needs to be placed on stressing upon importing countries their responsibility for end-use verification, while recognizing that in many cases this will require training and material assistance to establish systems for this purpose.  

The cases of chemical source countries sharing borders with drug producing countries, most notably Brazil and Argentina in South America, and China and India in Asia, are particularly difficult.  Not only must they regulate exports to ensure international transactions in regulated chemicals are not subject to diversion, they must regulate domestic commerce to prevent internal diversion and subsequent smuggling into drug producing countries.  

These needs require a coordinated and cooperative international response.  Individual efforts leave loopholes that will rapidly be exploited.  Some encouraging progress has been made.  UNDCP, following up on the 1993 US-sponsored CND resolution that requested it provide training and other assistance in the implementation of chemical regimes, is organizing a pilot chemical control project in Southeast Asia.  The British Government is providing $420,000 to fund the project.  Its objective is to assist Southeast Asian countries with a complete package of model chemical control legislation, and with training and material assistance for its implementation.  The first workshop in the project was held in Bangkok February 21-25, 1994, with British and Swiss experts conducting the session.

To assist in identifying mala fide importers, information exchange between chemical exporting countries needs to be improved.  DEA has been successful in opening informal channels of communication in Europe, but a regular information exchange mechanism has not yet been established.  Some European governments are concerned about sharing confidential commercial information.  The USG is working with the EU Commission and individual governments in diplomatic and law enforcement channels to develop a system that will address these concerns while still providing for the information exchange necessary for effective diversion control.



COUNTRY REPORTS


The country reports cover chemical control regimes in the major source countries for chemicals used in the production of cocaine and heroin.  The countries included in this section are those with large chemical manufacturing and trading industries that have significant chemical trade with drug-producing areas, and those considered to be the sources of chemicals diverted from domestic commerce and illegally smuggled into neighboring drug-producing countries.  Many other countries manufacture and trade in precursor and essential chemicals, some of which are diverted to illicit drug manufacture, but they are not considered major source countries at this time.  These designations will be reviewed annually.

Because of the important role drug-producing countries have in narcotics chemical control, a separate section reports on the status of chemical control in countries relying on chemical diversion for the significant manufacture of cocaine and heroin.

Major Source Countries

Europe

Germany and the Netherlands are considered the two major European source countries for chemicals used in the illicit production of narcotics.  As members of the European Union (EU), they are bound by the EU chemical regulations conforming to requirements of the 1988 UN Convention and the recommendations of the Chemical Action Task Force.  These regulations impose specific record keeping and reporting requirements for listed chemicals, establish a system of authorizations for imports and exports of listed chemicals and authorize government officials to refuse the authorization.  As with comparable US chemical regulations, the EC regulations do not specify procedures for making records available to foreign law enforcement authorities, including the United States.  Information sharing is a function of routine law enforcement cooperation on a case-by-case basis.

Germany 

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.  Germany is a party to the 1988 UN Convention which provides for the establishment and maintenance of a system, including records, to monitor international trade in the twenty-two precursor and essential chemicals included in the Convention.

Although Germany has adopted the EU chemical regulation that came into effect in January 1993, it continues to rely largely on the voluntary cooperation of its chemical industry to ensure the legitimacy of transactions in regulated chemicals, and to prevent their diversion.  This system appears to work well with regard to German chemical manufacturers.

However, there exist in Germany, mainly in Hamburg, chemical brokers who operate basically outside of this voluntary program.  These brokers obtain chemicals from German and non-German sources, and in some instances the chemicals are shipped from third countries, thereby making control problematical.  Some chemicals obtained from these brokers may continue to be diverted to cocaine laboratories in the Andean countries.

There is no formal US/FRG chemical control agreement.  In the latter half of 1993, US/FRG bilateral law enforcement cooperation and information sharing in chemical control for the first time produced concrete results.  It is hoped that this will become a pattern in the future.  Germany was an active member of the CATF.  The FRG has an arrangement with Colombia to provide that country with prior notification of transactions in five essential and precursor chemicals.  It is unclear if this arrangement covers brokered transactions shipped from third countries.

The Netherlands

The Netherlands has a large chemical industry.  It is also a major brokering and transit country for European-origin, primarily German, chemicals.  The Netherlands is a party to the 1988 UN Convention

Rotterdam, the world's largest port, is a major chemical shipping and storage facility.  DEA believes that a major portion of the chemicals diverted to illicit cocaine manufacture is shipped from the Netherlands as a result of transactions by Dutch and German brokers.

The Netherlands has a tradition of maintaining the confidentiality of commercial transactions.  Therefore, it is reluctant to share information on chemical transactions on the assumption that the vast majority are legitimate, and that the information could place Dutch-regulated companies at a competitive disadvantage.  Late in 1993, however, informal cooperation between DEA and Dutch investigative authorities did increase with limited concrete results.  It is hoped that this will become a pattern for the future.

Latin America

Argentina.

Argentina has requirements for the control and registration of essential and precursor chemicals based on the OAS Model Chemical Regulation.  These exceed the requirements of the 1988 UN Convention for regulating international commerce, including requirements for record keeping, licensing of imports and exports, and the authority to suspend shipments.  Argentina is also a party to the 1988 UN Convention.

The principal problem in Argentina is not chemicals entering international commerce, but the diversion of chemicals from Argentine domestic commerce and their smuggling into Bolivia.  The Drug Secretariat is examining a legal proposal to allow police to inspect destination company purchases and legitimate requirements, but it is being careful to avoid controls which would impede free commerce.
 
There are no formal procedures for the Argentine Government to grant US authorities access to its records on chemical transaction, nor for the US to grant similar access to USG records to the Argentines.  The Drug Secretariat's investigations into chemical diversion, its cooperation with DEA attempts to do so, and its sharing of information could be improved.

Brazil

Brazil remains a major transit country for chemicals from the United States and Europe and from its own chemical industry for use in the illegal production of cocaine in the neighboring Andean countries of Colombia, Peru and Bolivia.

Brazil does not have comprehensive chemical control legislation.  Administrative law 15 (Portaria 15) controls the sale of ether, acetone and acetic anhydride.  The law was issued by the Ministry of Health.  There is a provision in the pending comprehensive narcotics legislation that would give law enforcement officials the ability to conduct investigations regarding possession, export, import, storage, etc., of specific chemicals used in the production of illicit drugs.  The chemical portions of the legislation are modeled on the OAS Model Chemical Regulation.  Prospects for passage of this legislation are problematical.

Brazil is a party to the 1988 UN Convention.  The Federal Police Narcotics Division (DPF/DRE) maintains an updated list of manufacturers or importers of regulated chemicals who are to report transactions to them.  Such reporting is strictly voluntary.  While there is no legislation that makes it illegal to buy unlimited quantities of chemicals, some judges have, in some cases, been able to find enough leeway for prosecution under legislative provisions that make it illegal to produce or manufacture narcotics.

The DPF/DRE cooperates with the USG to the extent that it can, given its resources and existing legislation.  It does share the information it collects through the voluntary reporting system mentioned above.

Mexico

Mexico has a significant chemical industry.  Diversion from domestic commerce of locally manufactured chemicals is the probable source of chemicals used in the refining of Mexican opium into heroin.  Mexico is also an importer and transit point for chemicals.  Mexico is a party to the 1988 UN Convention.

Mexico does not have adequate laws and regulations to prevent chemical diversion.  However, draft legislation based on the OAS Model Chemical Regulation has been submitted to the Mexican Congress for consideration during its current session.  This legislation imposes record-keeping and reporting requirements for listed chemicals, establishes a system of authorizations for imports and exports of listed chemicals and authorizes government officials to refuse the authorization.
 
In an effort to improve controls over the flow of chemicals into and through Mexico, the Government has formed a task force consisting of representatives from the Secretariats of Agriculture, Treasury, Commerce, Defense, Environment, Customs,and Health.  In addition, the US Embassy and the National Institute for the Fight Against Drugs have formed a precursor chemical task force which initiated regular meetings in December 1993.  This will facilitate information exchange between US and Mexican authorities.

Asia

China

China is a party to the 1988 UN Convention.  Under a law adopted in 1988, China regulates the sale, distribution and import/export of certain precursor and essential chemicals.  As of April 1, 1993, these restrictions include all of the chemicals listed in the 1988 UN Convention.  Also, on April 1, 1993, a regulation was enacted placing all licensing of controlled chemicals under the Ministry of Foreign Trade and International Cooperation (MOFTEC).  MOFTEC is required to inform the national narcotics control commission about each request to ship controlled chemicals.  There are no formal procedures for making Chinese Government records on chemical transactions available to US law enforcement authorities.

China was a member of the Chemical Action Task Force (CATF) and participated in most of its meetings.  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 of heroin essential chemicals to traffickers outside China, particularly heroin traffickers in the Golden Triangle.  Chinese-origin potassium permanganate, either shipped directly or through European brokers, has been found in cocaine labs of the Andean countries.  Chinese produced ephedrine has also been used by Mexican traffickers in the manufacture of methamphetamine.

India

India manufactures most of the important heroin essential chemicals.  India is a a party to the 1988 UN Convention.

The Indian Government has some regulations on acetone, diethylether and chloroform, and stricter controls on acetic anhydride, a key heroin essential chemical.  In 1993, the acetic anhydride controls were extended to the entire country.  Previously, they had applied only within 50 kilometers of the Pakistani border and 100 kilometers of the Burmese border.  In addition, acetic anhydride is considered a controlled substance under the Narcotic Drugs and Psychotropic Substances Act, a criminal statue.  Persons found in violation of the law are subject to substantial fines and/or imprisonment.  Companies involved in the manufacture, sale and distribution of acetic anhydride are required to maintain daily records on all acetic anhydride transactions which will be available for review by the Narcotics Control Bureau.  There are no formal procedures to share Indian Government records on chemical transactions with US law enforcement authorities.
 
During the first nine months of 1993, authorities seized 16,226 liters of acetic anhydride.  However, there have been no seizures along the Indo-Burmese border since 1991, and acetic anhydride diverted from Indian domestic commerce and smuggled into Burma and Pakistan is considered an important raw material for heroin production in those countries.

Principal Cocaine and Heroin Producing Countries With Significant Chemical Diversion

Latin America

Bolivia

Bolivia is the world's second largest producer of coca leaf after Peru, and the second largest producer of cocaine HCL after Colombia.  Much of the coca leaf is converted to cocaine base in country by Colombian-controlled organizations and then shipped to Colombia for final processing into cocaine HCL.  Bolivia is not a major producer of chemicals, and the chemicals required for these activities are smuggled in from neighboring countries, or diverted from legitimate commerce in Bolivia.

Bolivia has chemical control laws on the books incorporating elements of the OAS Model Chemical Regulation.  These exceed the provisions of the 1988 UN Convention with regard to the number of chemicals regulated and the reporting and record keeping requirements.  There is also a bilateral US/Bolivian agreement on exchanging information on transactions in key essential chemicals used in the manufacture of cocaine.

There are, however, legal and administrative weaknesses that severely hamper effective implementation of chemical controls.  The 1988 Bolivian Coca and Controlled Substances Law (Law 1008) does not give the National Directorate for Chemical Control and Registration any authority to sanction or fine companies or entities which violate the regulatory controls imposed by the Directorate.  Solutions are being explored to give the Directorate these authorities, and to increase cooperation between the Directorate and other enforcement agencies to enhance chemical investigative capabilities.  The USG has been actively supporting these efforts.

Colombia

Colombia has adopted chemical controls laws and regulations based on the OAS Model Chemical Regulation.  The OAS model meets the requirements of the 1988 UN Convention, and imposes specific record keeping and reporting requirements for regulated chemicals, establishes a system of authorizations for imports and exports of regulated chemicals, and empowers government officials to refuse the authorizations.  Colombia has signed a bilateral chemical control agreement with the United States calling for cooperation in controlling a limited number of key chemicals, and it responded positively to the EU offer to provide prior notification of shipments of cocaine essential chemicals.  It also has a bilateral arrangement with Germany to receive prior notification of exports of five precursor and essential chemicals.
 Nevertheless, sufficient chemicals are available to traffickers for Colombia to remain the world's largest producer of cocaine.  Most of these chemicals must be imported in bulk quantities.  Others are smuggled in via Venezuela, Brazil and Ecuador.  Effective implementation of chemical import licensing systems that would verify legitimate end-use before issuance of licenses would have an immediate impact on bulk shipments and, thereby, help deny traffickers a major source of chemicals used in their illicit drug manufacture.

Peru

In 1993, the Peruvian Ministers of Interior and Industry gave added policy emphasis to chemical control as an effective counternarcotics measure, personally attending a well-publicized seminar for official and industry representatives.  Implementing regulations were issued in 1993 for the July 1992 chemical control decree, the Ministry of Industry's controlled chemicals office was reorganized, and a joint working group consisting of officials of industry, the National Police and the Peruvian Customs Service was established to improve contact between regulatory and enforcement officials concerned with chemical control.

Peru and the United States signed a bilateral chemical control agreement in May 1990, which entered into force through an exchange of diplomatic notes in February 1992.  Since the end of 1990, the USG and GOP had informally exchanged information on five major essential chemicals using procedures comparable to those established formally in the agreement.  The bilateral agreement covers the same five chemicals and formalizes the information exchange arrangements.

During 1993, the USG initiated limited financial assistance with international narcotics control funds under the bilateral US/Peru narcotics control project agreement.  Initial funding support, and technical advice and assistance by DEA, is being provided for computer software and systems designed to complement assistance provided by the OAS.  The OAS assistance has provided computer hardware for use in implementing the chemical control regulatory system, and for the design of a technical study to better define the extent of licit use of the most significant controlled chemicals.

Peru participated in the CATF, has given continuing support for implementation of its recommendations and for continuation of its responsibilities under the aegis of UNDCP.  Peru states that it intends to incorporate the CATF recommendations into its chemical control laws and regulations, and to conform them to the OAS Model Chemical Regulation.

The GOP list of controlled chemicals includes those whose control is internationally agreed to be significant.  GOP laws and regulations provide a method for maintaining records of transactions in controlled chemicals, but its institutional capabilities limit its administrative ability to ensure compliance with all of these requirements, and to make effective use of information reaching it from other countries.  Permits or declarations of imports and exports of listed chemicals are required.  GOP officials have the authority to seize or suspend shipments of listed chemicals if there is reason to suspect they are to be diverted to illegal use.
 
The GOP Ministry of Industry, Regulatory and National Police and Customs enforcement officials concerned with chemical control maintain an effective liaison relationship with the DEA Lima Country Office and the Narcotics Affairs Section of Embassy Lima.  These GOP offices exchange information fully and freely with the Embassy, and through it with other USG law enforcement authorities, as required.


Asia

Burma

Burma has narcotics legislation providing the necessary authority for action against trafficking and possession of precursor and essential chemicals, and occasionally there have been significant seizures.  In 1993, the GOB seized 1325 gallons of acetic anhydride, including a single 1,000-gallon seizure in November.  This quantity of an essential chemical could have been used in production of some four metric tons of heroin.  The GOB has not enacted separate chemical control legislation or become a party to international agreements for maintaining records on precursor and essential chemicals.  Such measures would have a limited impact on heroin manufacture since most of the chemicals required are smuggled into Burma from India and China.

Pakistan

Pakistan's laws are substantially in compliance with the chemical control provisions of Article 12 of the 1988 UN convention.  In 1991, the GOP placed controls on imports of acetic anhydride and criminalized its unlicensed import, manufacture, transport, and use.  There have been no arrests so far under these regulations.

There is only one manufacturer of acetic anhydride in Pakistan; its production, distribution and consumption are closely monitored by the GOP.  Imports are also controlled and monitored.  The GOP asserts that a system of record-keeping and reporting requirements for internal commerce in acetic anhydride is now in place.  However, the adequacy of the system has not been tested.

DEA and GOP counternarcotics agencies consider that most of the illicit acetic anhydride used in the conversion of raw opium to heroin is smuggled into Pakistan, chiefly from India.  Some may also enter through Eastern Europe via Afghanistan; not much is diverted from licit domestic use. 

The implementation of the record keeping system essentially accomplishes one of the main goals of the bilateral agreement between the Pakistan Customs Service and the Embassy Narcotics Affairs Section.  The second goal--preparation of a plan to interdict smuggling of acetic anhydride--has still not been met.

Pakistan is a party to the 1988 UN Convention that calls for maintenance of records of transactions in 22 precursor and essential chemicals.  It has not established procedures to make available its transaction records.  We do not, however, anticipate difficulties in obtaining such records as needed.  The US/Pakistani bilateral narcotics agreement signed last year provides for such information sharing.


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