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The Ofer-IRI Affair: Shipping Firm's Iranian Dealings Roil Israeli Politics

by DAN GEIST

30 May 2011 22:45Comments

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Iran Daylight Time (IRDT), GMT+4:30

IRISLLogo2.jpg10:45 p.m., 9 Khordad/May 30 The Economic Committee of the Knesset, the Israeli parliament, met in emergency session today to launch an investigation into how Israel's Ofer Brothers Group has been doing business with Iran in apparent violation of both Israeli law and international sanctions. Controversy over the affair erupted after the U.S. State Department's May 24 announcement that it was sanctioning Ofer, its Singapore-based subsidiary Tanker Pacific, and Shipping Brokerage Associated of Monaco over the $8.65 million sale last September of a tanker, Raffles Park, to Crystal Shipping of Sharjah, which was serving as a front for Islamic Republic of Iran Shipping Lines (IRISL). It was subsequently revealed that seven different Ofer-owned ships docked at the Iranian ports of Bandar Abbas and Kharg Island on at least 13 separate occasions between 2004 and 2007.

According to a report in the Sydney Morning Herald, the first round of parliamentary hearings were to "be attended by representatives of Israel's Defence Ministry, Foreign Ministry, the Prime Minister's Office and the National Security Council. The committee is expected to deliver an initial report next week on whether any laws were broken." Speaking on Israeli radio, Economic Committee Chairman Carmel Shama-Cohen declared, "It is inconceivable that Israeli companies would have commercial ties with Iran, our number one enemy, while we campaign to convince the international community to impose very strong sanctions and force Tehran to renounce its nuclear programme."

The Ofer Brothers Group, controlled by Sammy and Yuli Ofer, has denied responsibility for selling the tanker, claiming that the transaction was arranged entirely by Shipping Brokerage Associated and that company officials were unaware of the identity of its ultimate purchaser. As for the company's other dealings with the Islamic Republic, in the Herald's description, "Sources close to the Ofers quoted in the Israeli media say that in the spirit of breaking down barriers between countries, their tankers occasionally frequented Iranian ports and carried crude oil." Similarly unnamed sources reportedly intimate with the company have claimed that this business was conducted with the full knowledge and approval of Israeli Prime Minister Binyamin Netanyahu's office. Knesset deputy Arye Eldad, head of the right-wing Hatikva party, speaking on Israeli army radio, suggested that the Ofer tankers might even have been operating at the behest of the country's intelligence services: "Israelis have the right to know if the Ofer brothers are heroes or bastards, whether they acted for their personal profits or the presence of the tankers enabled listening and the taking of photos."

OferBrothers.jpgAddressing the Knesset's Foreign Affairs and Defense Committee on Sunday, Netanyahu explicitly denied all such claims, asserting that Ofer Brothers and Tanker Pacific were "never sanctioned to dock or unload goods in Iran.... Israel's policy on Iran is very clear -- any and all contact with it is forbidden."

Denials also came from the Iranian side. Mohammad Nahavandian, chairman of the Chamber of Commerce, Industries, and Mines, said that there would never be any deliberate dealings with an Israeli concern: "The Zionist companies are one of the causes for the sanctions against us." He continued, "News about activities of Zionist firms in Iran is a new game started in reaction to the willingness of certain countries to establish economic ties with Iran." According to a report on the website of Press TV, the English-language subsidiary of the Islamic Republic's state broadcasting network, Mohsen Sadeqifar, deputy managing director of the Port and Maritime Organization, said, "Ships belonging to shipping lines of the United States and particularly the Zionist regime have never entered Iranian ports during recent years." Israeli ships "do not dare to dock at Iranian ports," he declared. Israel's Ynet quoted an unnamed Iranian "director of port affairs" -- presumably Sadeqifar -- as saying that a "Zionist vessel" would have been permitted to dock only if it was "falsely hoisting other flags."

Ynet also presented an analysis of the legal questions surrounding the affair by a former Israeli Foreign Ministry legal counsel, Robbie Sabel, who described the legislation restricting trade with Iran as "absurdly porous." In contrast to the extensive and explicit sanctions imposed by the United States on companies trading with Iran, Israeli law barring trade with "enemy states" is far more general. The United States, observed Sabel, has a "special division for this matter, and all we have is 60-year-old legislation with meager enforcement." The report continues,

As for the issue of docking in an Iranian harbor, Sabel said that while an Israeli crew is absolutely forbidden from docking in Iran, if the crew was not Israeli, it is uncertain whether they can be bound by the Israeli law simply for working on an Israeli-owned vessel.

Legal questions aside, there is also the political impact of the revelations within Israel. In a Monday commentary piece, Yosi Melman of Haaretz daily, who has reported extensively on the Ofer-IRI affair, took the country's government to task. He described the many voluntary moves to limit trade with the Islamic Republic that have been adopted by firms around the world

because they fear the policy of certain American states, trade unions and municipalities to keep their pension funds from investing in companies that do business with Iran. For example, about a year ago, Los Angeles canceled a quarter-million-dollar contract with Germany's Siemens because the conglomerate did business with Iran.

In this context, Israel's hypocritical and self-righteous policies stand out even more prominently. Israel preaches to the whole world about the need for sanctions on Iran, while doing absolutely nothing about them.

For example, while Los Angeles canceled a major transportation contract with Siemens, the Israel Airports Authority decided to purchase about NIS 150 million worth of equipment from that company. And the Israel Electric Corporation has awarded a half-billion-shekel contract to the Danish firm Haldor Topsoe for air-pollution filters, even though that company is building refineries in Iran to the tune of billions of dollars.

Israel's hypocrisy can also be seen in its unwillingness to enforce its own law. That law, passed at the behest of Benjamin Netanyahu even before he became prime minister, clearly states that Israeli companies may not invest more than $10 million in an international company that does business with Iran.

While the controversy continues to roil the Israeli political scene, the Iranian government and media do not appear preoccupied with the matter. By Monday, the references to Israel in state-controlled and -aligned press organs had returned to their norm. Fars News Agency's website, for instance, featured a story, "Analyst: Zionist Lobbies Thwart Improvement of US Ties with Iran," focusing on the observations of Imad-ad-Dean Ahmad, a lecturer at Maryland University. "I see no significant change in the American policy towards Iran. American policy continues to be driven primarily by the concerns of the Zionist lobby," Ahmad told Fars. Those concerns, he said, are "impeding Iranian support for Hezbollah and Hamas and for Palestinians in general, maintaining the status quo in Sunni-Shiite hostilities to avoid a peaceful resolution that would end intra-Muslim rivalry which Israel has used to its advantage while at the same time avoiding a boiling over into a violent confrontation that might cause the fall of pro-American regimes, like Bahrain, and preserving Israel's nuclear monopoly in the Persian Gulf."

Copyright © 2011 Tehran Bureau

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