Committee on Relations

with Host Country

211^th Meeting (PM)

COMMITTEE ON RELATIONS WITH HOST COUNTRY CONSIDERS PROBLEM

OF NEW YORK CITY TAX DEMANDS ON LIBYAN MISSION

Also Discussed:  Travel Restrictions on Certain Diplomats,

Delays in Issuance of Visas, Ceilings on Delegation Bank Accounts

The Committee on Relations with the Host Country this afternoon considered real estate taxes and accumulated interest charges imposed by New York City authorities on seven floors of the Permanent Mission building of Libya; a request by that delegation to lift the ceilings on its bank accounts in New York; delays in issuing visas to delegates; and travel restrictions on some delegations.

For its consideration of the tax matter, the Committee had before it a letter dated 21 March from the Permanent Representative of Libya to the United Nations (documents A/AC.154/346 and Add.1).  Annexed to the letter was a memorandum outlining the “illegal demands” for real estate taxes on the building.  The addendum referred to a note verbale sent to the United States Mission expressing the Libyan Mission’s intention to rent seven floors of the building, pending approval by the United States Treasury Department, to other Missions of the United Nations.

According to the letter of 21 March, the demand for taxes amounted to $40,411,664.14 for the building at 309 East 48^th Street in Manhattan.  It also says that despite the fact that the floors had remained unoccupied since the issuance of two Executive Orders of the United States Government in January 1986, and although no income had been produced, the New York City authorities continued to assess real estate taxes on them throughout the period in question and to demand enormous sums in accumulated interest.

The representative of Libya said the construction license for the Mission building had stated that the seven floors could be used for commercial purposes if they were rented out.  The Mission, however, had never rented out any part of those floors, and those floors did not provide any income for the Mission.  Prior to President Reagan’s decision to freeze Libya’s assets, the Mission had nevertheless paid taxes.  After that decision, the relevant authorities had informed the Mission that they did not have the right to rent out the floors, and that the taxes the Mission paid would go back to the assets frozen by the United States.  In a meeting with the New York City authorities, the Mission had proposed renouncing the commercial nature of the floors.  The relevant authorities should stop making demands regarding taxation.

The representatives of Iraq and Cuba were concerned that the legal issue could constitute a precedent.  A dialogue with the United States delegation was necessary to clarify matters.

The United States representative said his country would continue to meet all of its obligations as host country to the United Nations and it took those very seriously.  On the subject of the taxation questions, he said he had been designated to work with New York City authorities to look into several property issues.  He had listened closely to the concerns expressed today and would meet with anyone who wished to supply further details.  He would then advise the Committee and any concerned delegations of his efforts.

The representatives of Mali and Hungary also spoke on the matter.

Addressing the issue of delays in issuing entry visas to members of his delegation, the representative of the Russian Federation said he understood that the host country had to take additional measures after the events of 11 September. However, at present, the time for consideration of issuing a visa was a minimum of three to four weeks.  There was a need to make a clear distinction between tourists and businesspeople on the one hand and members of a State delegation on the other.  He was satisfied that the United States was ready to address the issue.

The representatives of Libya and Iraq also complained about the same issue. The representative of Iraq noted that, because of the problem, children from Iraq had not been able to participate in the recent special session on children.  When returning from Geneva, he himself had had to wait three weeks for a re-entry visa to the United States, and the Secretary-General had had to intervene three times in the matter.  That situation was unacceptable, he said.

The representative of the United States said it was impossible to reply today to every point raised by delegates.  Only this morning, he had received the text of a letter dated 23 May (document A/AC.154/351) from the representative of Iraq.  He would provide a reply to the Iraqi Mission in the form of an official document to the Committee.

Regarding travel restrictions imposed by the host country on delegates from some countries, the representative of Cuba said the host country had a policy of denying travelling requests from Cuban diplomats beyond the 25-mile limit in order to participate in events organized by universities and the like, which were mostly related to issues concerning the Organization.  In 2002, the Cuban Mission had requested three times to participate in academic conferences relating to United Nations issues, and all three requests had been denied.  The host country was not complying with international obligation vis-à-vis immunities of diplomats.  She did not understand why the policy against Cuban officials was implemented, and invited the host country to analyze the requests for Cubans travelling beyond the 25-mile limit or even to eliminate those restrictions.

Libya’s representative said his Mission had also suffered from the same problem.  Because of travel restrictions, members of the Libyan Mission had not been able to use its house in Englewood.  If Libya would sell that house, proceeds

of the transaction would go to the frozen assets and could not be used to buy other property in New York City.  He called that situation ridiculous. 

The representative of the United States said some travel restrictions had been imposed for reasons of national security, but in no way had his Government intended to impede travel to official United Nations meetings.  His Government was committed to honouring and fulfilling its commitments as the host country, and saw no contradiction in that regard with its inherent right to safeguard its national security.  The host Government had not considered that it was obligated to allow Secretary Benitez of the Cuban Mission to travel to a non-United Nations meeting.

Turning to the issue of the ceiling on the bank accounts of the Libyan Mission, the representative of Libya said he had received a negative response from the United States Mission to Libya's request to lift that ceiling.  Transferring the funds to Libya cost “scores of thousands of dollars”.  Those costs were the result of the exchange rates.  He could not accept the restrictions imposed on his Mission, which contravened existing norms and agreements.  He asked why that ceiling was in place.  “We have nothing to fear; we have nothing to hide”.

In response, the United States representative said that the request had been considered at senior levels.  It was decided, for the time being, to leave the ceilings in place, but his Government was prepared to revisit the issue in the future.  With all due respect, he added, if the Libyan Government was losing tens of thousands of dollars on each transaction, it needed a new transfer agent. 

The representatives of Malaysia, Cuba and France also addressed the issue.

The Committee will meet again at a date to be announced.

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