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### Viewing cable 06COPENHAGEN352, ANTI-ISRAEL CLAUSES - LESS THAN MEETS THE EYE

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
06COPENHAGEN352 | 2006-03-21 05:27 | 2011-05-19 00:00 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy Copenhagen
Appears in these articles: http://www.aftenposten.no/spesial/wikileaksdokumenter/article3965559.ece

`

    VZCZCXYZ0001
    PP RUEHWEB

    DE RUEHCP #0352/01 0800527
    ZNR UUUUU ZZH
    P 210527Z MAR 06
    FM AMEMBASSY COPENHAGEN
    TO RUEHC/SECSTATE WASHDC PRIORITY 2128
    RUCPDOC/DEPT OF COMMERCE WASHDC

` `

    UNCLAS COPENHAGEN 000352

    SIPDIS

    SIPDIS

    SENSITIVE

    E.O: 12958: N/A
    TAGS: ECON PREL ETRD PHUM IS DA
    SUBJECT: ANTI-ISRAEL CLAUSES - LESS THAN MEETS THE EYE

    ¶1.  (U) Summary:  In the context of domestic Danish politics
    following the Mohammed cartoon crisis, it has become known
    that some Danish firms accept the use of anti-Israel clauses
    in trade agreements with certain Muslim countries.  The
    government of Prime Minister Anders Fogh Rasmussen, despite
    considerable irritation with Danish business for pressing
    the government to distance itself more clearly from the
    publication of the cartoons, joined the business community
    in downplaying the use and significance of anti-Israel
    clauses.  Unlike the United States, Denmark has no
    legislation explicitly prohibiting the use of such clauses
    in trade agreements.  End Summary.

    ¶2.  (U) Jyllands-Posten, the Danish newspaper which
    published the Mohammed cartoons, reported in late February
    that a handful of Danish firms have signed anti-Israel
    clauses when doing business in the Middle East.  The story
    surfaced just when domestic political wrangling over the
    Mohammed cartoon crisis was escalating.  On February 27, PM
    Fogh Rasmussen publicly accused broad circles in Danish
    corporations, culture and media of failing to support
    freedom of expression during the controversy.  This opened a
    broad fissure between the government and business leaders,
    and exacerbated tensions between Fogh Rasmussen's Liberal
    Party and its junior coalition partner, the staunchly pro-
    business Conservative Party.  In this context, the
    allegations of craven Danish business practice, and the
    implication of government acquiescence, generated
    considerable public attention.

    ¶3. (U) The dairy producer Arla admitted having active
    contracts with clauses that no ingredients produced in
    Israel are used in the production of Arla's exports to Arab
    countries and that shipments are not sent through Israel.
    Furthermore, it is clear that at least four Danish firms
    agreed to participate in some form of boycott of Israel in
    return for trade with Iraq in 2000-2001:

    -- Bruel & Kjaer, a manufacturer of sound and vibration
    equipment, signed a clause that its goods did not include
    any parts, raw materials, labor or capital of Israeli origin
    and that the goods did not pass through Israeli ports;

    -- The pharmaceutical producers Maquet and Leo Pharma signed
    clauses prohibiting trade or transport through Israel;

    -- Bukkehave, a firm supplying vehicles and spare parts to
    international organizations and companies working in
    developing countries, signed a clause to "abide by and
    comply in all respects with the rules and instructions
    issued from time to time by the Israel boycott office in
    Iraq."

    ¶4. (U) These companies downplay the significance of the
    clauses.  Arla states that despite signing the clauses, it
    has never boycotted Israel and trade with Israel has been
    increasing.  Leo Pharma no longer maintains these clauses
    but says they were previously a condition for selling
    medicine in the Middle East.  Leo Pharma has maintained
    regular trade with Israel despite the clauses.  Bukkehave
    states that the agreement was signed at a local level.

    ¶5. (U) Post approached some of the main business
    organizations in Denmark for their views on the prevalence
    of anti-Israel clauses.  According to the Confederation of
    Danish Industries (DI), the use of such clauses is limited
    at present and is diminishing in line with increasing Arab
    WTO membership.  DI Director Joergen K. Hansen said that
    "the boycott has on several occasions been discussed in
    parliament.  DI has always been opposed to this form of
    special restriction and has supported attempts to find a
    solution at the EU level."  DI paints a picture of an
    unofficial policy in some parts of corporate Denmark to sign
    the anti-Israel clauses but disregard them and continue
    trading with Israel, often through other subsidiaries in the
    group.  Danish Shipowners' Association official Ren Pihl
    Pedersen says the Danish shipping industry does not sign
    anti-Israel clauses and that "the problem has been on the
    decline for years and is almost non-existent at present."

    ¶6. (U) Ambassador Svend Roed Nielsen of the MFA's Danish
    Trade Council says that the anti-Israel clauses have a long
    history but are rarely used at present except in trade with
    Syria and Libya. "We have informed companies that the
    boycott is clearly violating international trade standards
    but there is no Danish law prohibiting the companies from
    signing the clauses," Nielsen states.

    ¶7. (U) When asked by the Danish press for a public comment
    on the acceptance of anti-Israel clauses by Danish firms,

    the American Israel Public Affairs Committee (AIPAC)
    provided the following standard reaction: "Agreeing to
    boycott Israel in exchange for business in the Arab world
    reinforces Arab racism against Israel, demonstrates highly
    unethical business practices. and may be in violation of WTO
    rules.  Danish companies should be particularly sensitive to
    this at a time when they are being targeted as well with
    unfair boycotts." In a follow-up comment to post, AIPAC's
    Director of Media Affairs Joshua Block stated that "AIPAC
    sees the response as a pretty minor thing: a comment on
    something so basic as the Arab boycott."

    ¶8.  (SBU) Comment: It may not be wholly coincidental that
    this story of questionable Danish business practice in the
    Middle East emerged just as political waters were roiling
    over the Mohammed cartoon crisis.  Post's inquiries support
    the view that the acceptance by the Danish business sector
    of anti-Israel clauses in trade agreements is limited and
    diminishing.  In cases where they have been signed, firms
    appear to ignore these clauses in practice.  Despite the
    absence of legal prohibitions, neither the government nor
    the Confederation of Danish Industries offers support or
    comfort to firms that have entered into such arrangements.
    Post will continue to monitor the issue.

    CAIN

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