German Firms Still Ship Dual-Use Goods to Iran

Germany’s multi-billion euro bilateral trade relationship with Iran continues unabated, even as evidence mounts that the Islamic Republic is determined to build a nuclear weapons capability.

The Jerusalem Post has obtained an uncensored list from late 2011, showing hundreds of German and Iranian enterprises in a flourishing trade relationship.

This is despite Iran’s construction of Fordow, a medium-level uranium enrichment facility buried into the side of a mountain near Qom, and the fact that the German equipment could be used to build more underground nuclear facilities.

Some businesses have asked that their names be removed from the list to avoid damage to their reputations.

One company named is Baden-Württemberg-based engineering giant Herrenknecht AG, which appears to be delivering heavy tunneling equipment to Iran – some of which is promoted as having the capability of “drilling down to depths of 6,000 meters.”

In response to Post inquiries, an unidentified representative of the company wrote via email on Friday that it has “comprehensively ensured that Herrenknecht excavation engineering and services solely reach projects which clearly pursue civil applications [metro tunnel construction, sewage pipes and water supply lines].”

After such projects are completed, it cannot be determined if Iran intends to or already has used the equipment for its nuclear facilities.

Merchandise that can be used for military and civilian purposes falls under the rubric of “dual-use” goods and may require approval from Germany’s Federal Office of Economics and Export Control (BAFA)

In response to Post questions, BAFA spokesman Volker Anders wrote via email on Friday that the agency cannot comment because “administrative law does not allow [the disclosure of] industrial and business secrets.”

Herrenknecht had told the Post that its transactions with Iran were approved by BAFA.

When asked if his office had explicitly approved them, Anders responded that BAFA issued approval for seven dual-use deals in 2011 worth a total of about 860,000 euros. The spokesman declined to name the companies and said that statistics for the January to June 2012 period were not available.

Anders added that BAFA approved 579 applications in 2011 regarding industrial goods that were affected by sanctions against the Islamic Republic. The value of these German-Iranian deals amounted to a little over 65 million euros.

Tommy Steiner, a senior research fellow at the Institute for Policy and Strategy at the Interdisciplinary Center, Herzliya, told the Post on Sunday: “Since the 1960s, Germany has been a steadfast ally of Israel and contributed to Israel’s national security. One would hope that the German authorities would apply rigid scrutiny to dual-use equipment and technology that meets the criteria of sanctions enforcement.”

The revelations have surfaced at a tricky moment for German diplomacy with Iran over its nuclear program. The Federal Republic is a member of the so-called the P5+1 — the five permanent members of the UN Security Council, plus Germany — and German diplomat Helga Schmid led last week’s technical nuclear negotiations in Istanbul with representatives of Iran’s government.

Late last month, Germany’s Federal Statistical Office said that bilateral trade with Iran in 2011 totaled nearly 4 billion euros (with about 3b. euros in German exports and 778m. euros in Iranian imports).

Asked by the Post whether its business activities in Iran imperiled international security and Israel, the unnamed Herrenknecht representative said, “We would never do something that could hurt or place the Jewish state in danger.”

The company added: “We distance ourselves from every condescending, cynical or vile statement toward the Jewish people or the State of Israel.”

Though EU sanctions have been in place since 2010 to bar oil and gas technology trade with the Islamic Republic, Herrenknecht participated in Iran’s most important oil trade show in 2012.

To participate in the Iran oil show, companies are required to send their registration fees to Bank Mellat – which the EU and US had sanctioned due to its involvement in nuclear proliferation.

Herrenknecht declined to answer Post questions about financial transactions with Bank Mellat.

The list showed that Merck KGaA, the giant Hesse-based chemical and pharmaceutical company, has long been active in Iran. Merck spokesman Steffen Mueller remained largely tight-lipped about its work with Iran, writing in an email that the company adheres to all existing trade conditions.

The list also has an entry from Linde Material Handling GmbH.

Linde spokesman Detlef Sieverdingbeck wrote via email that the company delivered roughly 30 forklifts to Iranian customers in 2011, with revenue totaling 800,000 euros. He said that since December, the company has not accepted new orders from Iran because of political conditions. It is unclear if the Linde forklifts have been used in nuclear-related construction work.

Saba Farzan, a leading German-Iranian journalist who has written extensively about the Islamic Republic, told the Post on Sunday: “The world has seen the Iranian regime for three long decades using lies and betrayal whenever dealing with the international community – especially visible in this crisis over Iran’s nuclear weapons program. So how could any company around the world doing trade with this regime seriously believe that goods delivered will be used with responsibility? “Of every single innocent item, this regime has the capability to turn it into something useful for its nuclear weapons program – and with that something dangerous for the entire world,” she said.

Farzan added: “Every company that is until this day doing trade with the Islamic Republic should be reminded that profit should not exclude social responsibility.

Social responsibility toward Iran’s civil society, which works courageously toward achieving freedom, respect for human rights and democracy. To me as a German- Iranian, it is mind-blowing – why on earth are our businesses such huge trade partners of this terrible regime?” Herrenknecht declined to comment about its social responsibility policies.

Farzan added, “It is my country, Germany, that has offered me the freedom that the country of my childhood has taken away from me and millions of other Iranians. I want my country, Germany, to be on the right side of history. This terror regime will fall, no doubt about it. Can we speed up its downfall? We certainly can. The best way to guarantee that is through ending our trade relations with it.

“We need to do that for the sake of the Iranian people, the security of Israel, the region and the rest of the world, and for our own conscience,” Farzan said.