Answer to parliamentary questions about Venezuelan conflict gold that is traded via Curaçao and Aruba

THE HAGUE - Undersecretary of the Interior and Kingdom Relations Raymond Knops answered the questions about Venezuelan conflict gold that is traded via Curaçao and Aruba. These parliamentary questions were asked by Mr Özütok, Mr Diks and Mr Van Ojik (GroenLinks).

“I hereby also offer you on behalf of the Minister of Foreign Affairs, the Minister for Foreign Trade and Development Cooperation and the State Secretary for Finance, the answers to the written questions asked by members Özütok, Diks and Van Ojik about Venezuelan conflict gold passing through Curaçao and Aruba is traded.”

These questions were submitted on July 5, 2019 with reference 2019Z14685.

Question 1

Do you know the reports that gold from Venezuela is still traded via Curaçao (despite a ban) and Aruba? If so, are these reports correct?

Answer 1

I know the reports. I have been informed by the Curaçao authorities that the import, export and transit of gold from Venezuela is prohibited by ministerial regulation with effect from 21 June 2019 with immediate effect. Aruba, too, has decided through a ministerial regulation, dated July 25, 2019, to ban all imports, exports, and transit of gold directly and indirectly from Venezuela. This ministerial regulation entered into force on July 26, 2019.

Question 2

Do you have insight into the nature and extent of the gold trade in the Caribbean Netherlands and Sint Maarten?

Answer 2

I am not aware of any figures at present about the nature and extent of the gold trade in Sint Maarten, despite inquiring with the Government of Sint Maarten. When it comes to trade in gold in the Caribbean Netherlands, it applies that gold must be declared both on import and export via the normal declaration procedure. The Ministry of Finance has announced that in the last 5 years no declaration of imports of gold has taken place from Venezuela in the Caribbean Netherlands.

Question 3

Can you explain how it is possible that Curaçao has exported at least 130,000 kg respectively in the past five years and Aruba has traded nearly 30,000 kg in the last two years, while neither Curaçao nor Aruba have gold mines?

Answer 3

In answering the parliamentary questions of the member Van Raak (SP) dated February 8, 2012 and April 9, 2013, the authorities of Aruba and Curaçao have previously stated that it is not about the export of gold, but about the transit of gold. Trade in gold is in principle not prohibited either, provided that the gold has the correct certificates and documents and the national customs legislation and regulations are met.

Question 4

Has the legal origin of these large quantities of gold been established and is it guaranteed that this gold will not be laundered through the countries? If not, what measures have been taken against this?

Answer 4

In the context of combating money laundering, it is important that precious metals have reliable certificates and the correct (export) documents and that they comply with the customs legislation and regulations of the relevant part of the Kingdom. After the Criminal Investigation Team (RST) seized a batch of gold in Aruba in 2018, Aruba adjusted its policy about combating money laundering with regard to imports, exports and transit of precious metals from April 2018. For example, the Public Prosecution Service must since then be informed of transports of precious metals of 1 kilo or more. After that time, four more shipments were registered that were sent through Aruba.

The Aruban authorities have indicated that all four shipments met the necessary customs formalities for transit. Because nevertheless the necessary care and attention still existed about the origin of Venezuelan gold, Aruba and Curaçao, as mentioned in the answer to question 1, have now completely banned the import, export and transit of gold from Venezuela.

Question 5

How does trading of Venezuelan conflict gold via Curaçao and Aruba and possibly other Caribbean parts of the Kingdom relate to the Dutch recognition of Mr Guaidó as Venezuelan president and the Gold Covenant drawn up by the Netherlands in 2017, promising that the signatories will adhere to the guidelines for multinational companies of the Organization for Economic Cooperation and Development (OECD guidelines) and UN Guiding Principles for Business and Human Rights for corporate social responsibility?

Answer 5

The Kingdom has recognized Juan Guaidó as the interim president of Venezuela with the aim of organizing free and fair elections. Due to the current political stalemate, elections are not yet in place. For the most part, effective authority lies with the Maduro regime. In order to increase the pressure on the Maduro regime, the European Union has established a sanction regime. For example, there is an arms embargo and personal sanctions have been imposed against high-ranking individuals who are guilty of undermining democracy and human rights violations. Sectoral sanctions are not part of the EU sanction regime.

The aim of the signers of the Gold Covenant (the Minister of Foreign Trade and Development Cooperation, companies from the Dutch gold sector and civil society organizations) is to work on a responsible value chain for gold by means of due diligence. The agreements in the covenant are based on the OECD guidelines and the UN Guiding Principles on Business and Human Rights (UNGPs). According to these guidelines, companies must shape their chain responsibility by identifying, preventing or mitigating potential risks in their chain and accounting for them. The reports for the two years since the signing of the gold covenant revealed no link with gold from Venezuela.

In the context of the gold covenant and the broader policy on international corporate social responsibility, the central government is bringing responsible raw material extraction to the international attention. For example, the government is committed to reducing mercury use in gold mining through the Minamata Convention.

The central government also brought responsible resource extraction and the gold covenant under the attention of the SDGs and Initiatives for Sustainable Global Value Chains conference on 30 October 2018 and the annual OECD forum for responsible minerals in April.

Question 6

Do you share the opinion that Venezuela does not comply in any way with the requirements of corporate social responsibility and that Venezuela is guilty of illegal mining, oppression and exploitation? If so, should it not be inferred that Venezuelan gold should not have been traded since 2017?

Answer 6

From the coverage of gold from Venezuela and the report of the International Crisis Group of February 2014, I deduce that gold mining in southern Venezuela has been taking place in recent years under the supervision or control of armed groups. This area therefore falls under the definition of conflict and high-risk areas in line with the Due Diligence Guidance for Responsible Supply Chains or Minerals from Conflict-Affected and High-Risk Areas that builds on the OECD guidelines for multinational companies.

This means that companies must be extra alert when importing or trading in gold from Venezuela. Companies that import or trade gold from conflict and high-risk areas, or from a country that is known to transit gold from such areas, must prepare and implement a risk management plan. Both the OECD guidelines and the UNGPs require companies to identify, prevent or mitigate risks in the chain, and see exclusion as the last option.

Question 7

What measures do you intend to take, in close consultation with the Caribbean parts of the Kingdom and the Caribbean Netherlands, to combat imports, transit and trade in Venezuelan conflict gold to prevent the Netherlands from trading in conflict minerals and indirectly related human rights violations in Venezuela? makes possible?

Question 8

How is it prevented that conflict minerals from Venezuela are traded via the Netherlands in a different way?

Answer 7 and 8

As already reported, Aruba and Curaçao have now completely banned the import, export and transit of gold from Venezuela.

The Dutch government is responsible for encouraging companies in international corporate social responsibility. The government assumes that responsibility in the gold sector by making agreements with Dutch companies in the sector and by implementing the EU conflict mineral regulation that will enter into force for the Netherlands on 1 January 2021. The regulation requires importers of tin, tantalum, tungsten, and gold from conflict and high-risk areas to apply appropriate care in the supply chain and to report on this annually. The Human Environment and Transport Inspectorate (ILT) has been appointed as the competent authority to supervise compliance with the regulation in the Netherlands.

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