Understanding DPRK Ship-to-Ship Transfers Using Public Records

05/06/19 6 minute read

DPRK Ship-to-Ship Transfers with the Yuk Tung

In its most recent report on the Democratic People’s Republic of Korea’s (DPRK) efforts to evade international sanctions, the United Nations Panel of Experts established pursuant to Security Council Resolution 1874 (2009) detailed the involvement of a Taiwanese company called Vanguard Shipping Safety Management Consultant Co Ltd in sanctions evasion and illicit ship-to-ship transfers with the DPRK.

The Panel described how Vanguard Shipping helped a Seychelles company called Virtue Base Development Ltd apply for an IMO number. Subsequently, someone—it’s unclear who, based on the Panel’s reporting—fraudulently applied for Equatorial Guinean vessel registration certificates to disguise the oil tanker Yuk Tung (IMO No. 9030591). This vessel later was sanctioned by the United States in February 2018 for engaging in prohibited ship-to-ship transfers with DPRK vessels.

According to the Panel, the Yuk Tung subsequently used this disguise while engaging in an additional illicit ship-to-ship oil transfer. (For the full details, see pp. 8-13 of the Panel’s 2019 report.)

Was Vanguard Shipping complicit?

This raises questions about the extent to which Vanguard Shipping was aware of or complicit in the Yuk Tung‘s fraud and illicit activity.

In its response to the Panel, Vanguard Shipping claimed to know nothing about Virtue Base Development Ltd or the activities of the Yuk Tung. The Panel does not comment explicitly on the question of Vanguard Shipping’s complicity in this report.

Regardless, this is at least the third time Vanguard Shipping has been linked to illicit ship-to-ship transfers involving the DPRK. Using public records, we can demonstrate ties between Vanguard Shipping and two other vessels that conducted these activities: the Koti and the Jin Hye.

DPRK Ship-to-Ship Transfers with the Koti

In 2018, the Panel of Experts reported that Marshall Islands corporation Sailing Petrochemical Inc. leased an oil tanker called the Koti (IMO No. 9417115) from Taiwan-based Auria Resource Co., Ltd. shortly before the Koti conducted a ship-to-ship transfer with a DPRK vessel (see p. 33 of the Panel’s report).

The Panel did not clarify exactly when this ship-to-ship transfer took place. However, it did state that the Koti manipulated its Automatic Identification System (AIS) records—a system installed on all large ships that’s meant to improve maritime safety by accurately tracking ship positions in real time—for several days in late November and early December 2017.

The United States subsequently sanctioned the Koti for engaging in a ship-to-ship transfer with the sanctioned Kum Un San 3 (IMO No. 8705539) on 9 December 2017.

Vanguard Shipping manages another oil tanker for Sailing Petrochemical Inc. Sailing Petrochemical Inc. is the registered owner of the Amber (IMO No. 9009073), a chemical/oil products tanker that shipping data indicates is active in East Asian waters. The Amber’s ship manager is Vanguard Shipping

DPRK Ship-to-Ship Transfers with the Jin Hye

The Jin Hye (IMO No. 8518572) is an oil products tanker that operated under the flag of Sierra Leone prior to April 2018. In its 2018 report, the Panel of Experts published evidence that the Jin Hye engaged in a ship-to-ship transfer with the DPRK-flagged Chon Ma San (IMO No. 8660313), an oil products tanker that the United States sanctioned at the same time it sanctioned the Koti.

Vanguard Shipping was the Jin Hye’s ship manager and ISM manager at the time of the alleged ship-to-ship transfer. Ship management records indicate that Vanguard Shipping resigned the role of ISM manager in October 2018, but it continues to be the ship manager of the Jin Hye.

What does this all mean?

Due to the opacity of corporate records in Liberia and the Marshall Islands, it’s impossible to determine on the basis of public records alone who actually owns the Jin Hye and who was responsible for the Koti at the time of the illicit ship-to-ship transfers.

However, public records do make clear that Vanguard Shipping’s involvement in sanctions evasion with the Yuk Tung isn’t its first rodeo.

Vanguard Shipping manages a vessel owned by a company that was allegedly leasing the Koti when it conducted an illicit ship-to-ship transfer with a sanctioned DPRK vessel in 2017. It also was the manager of the Jin Hye when it conducted a ship-to-ship transfer with another DPRK vessel.

These links raise serious questions about Vanguard Shipping’s protestations (p. 88) to the Panel of Experts that they know nothing at all about Virtue Base Development’s efforts to fraudulently apply for a false certificate of registry. Policymakers monitoring the DPRK’s efforts to evade UN limits on oil imports would do well to note that Vanguard Shipping currently manages 16 vessels, 12 of which are chemical or oil products tankers.

As the saying goes: fool me once, shame on you; fool me twice, shame on me. For Vanguard Shipping, this is at least the third time their name has come up in relation to DPRK sanctions evasion. Let’s hope there’s not a fourth.