No Samsung phones, Nike uniforms for N.Koreans? Sanctions cloud Olympic perks (updated)

SK Networks Co

02/02/2018 11:15

* Tough sanctions, laws cause headaches for S.Korean 
officials 
    * Permission needed for flights between North and South 
    * Perks such as high-end phones, equipment might breach 
sanctions 
    * For multimedia coverage: https://www.reuters.com/north-korea/ 
 
 (Add no comment from ice hockey federation; paragraphs 21,22) 
    By Hyunjoo Jin and Christine Kim 
    SEOUL, Feb 2 (Reuters) - All of the almost 3,000 athletes 
competing at the upcoming Pyeongchang Winter Olympics are set to 
get perks including the latest $1,100 Samsung  005930.KS  
smartphones, top of the range new equipment to take home and 
sleek Nike  NKE.N  uniforms.  
    All except perhaps the 22 athletes from North Korea. 
    Tough international sanctions including travel restrictions 
and a ban on the sale of luxury goods and sports gear have 
complicated South Korean Olympic organisers' efforts to provide 
their northern neighbors with the same benefits available to 
other Olympians. 
    For months, South Korean President Moon Jae-in has sought 
North Korea's participation in the hopes it will ease tensions 
between the still officially warring nations and prevent the 
kind of violent incidents which have plagued previous major 
events hosted by the South. 
    Officials have rolled out the red carpet and are keen to 
make sure the visits go off without a hitch. 
    North Korean female ice hockey players and their South 
Korean teammates, who will compete as one nation in the Games 
for the first time, have been living and training together this 
week, even sharing a birthday cake.  
    Other members of the North Korean delegation, such as the 
cheer squad, will be housed in luxury hotels. 
    Overshadowing those efforts, however, are a host of U.S. and 
U.N. Security Council sanctions on Pyongyang over its efforts to 
develop a nuclear-tipped missile capable of hitting the United 
States. 
    At almost every turn, South Korea has had to go great 
lengths to make sure its hospitalities don't run afoul of 
sanctions or other laws, according to several South Korean 
officials.  
    Just raising the North Korean flag alongside other national 
banners in the Olympic Villages required an exemption from South 
Korean laws banning praise of the North Korea regime, a 
Pyeongchang organizing committee official told Reuters. 
    The officials all declined to be identified due to the 
sensitive nature of the matter.  
         
    NO GALAXY NOTE 8, NO NIKE? 
    Samsung Electronics, an official sponsor of the Winter 
Games, is offering 4,000 Galaxy Note 8 smartphones specially 
designed for the Olympics to "all" of the participating 
athletes.  
    The International Olympic Committee will distribute them, a 
Samsung Electronics spokesman told Reuters.  
    But South Korea is not sure if North Korean athletes will be 
eligible for the treats because of U.N. Security Council 
sanctions, an Olympics organiser told Reuters. 
    The official declined to elaborate, but experts say 
providing the $1,100 Samsung phone could violate U.N. sanctions 
that ban the sale of luxury items and electronics with a 
potential "dual" commercial and military use. 
    Meanwhile, the joint women's hockey team will wear uniforms 
made by a Finnish company instead of official sponsor Nike, 
because of concerns about U.S. sanctions, another South Korean 
government official told Reuters. 
    Unilateral U.S. sanctions go far beyond the U.N. sanctions, 
effectively banning U.S. companies and individuals from trading 
with North Korea. 
    "We are trying to figure out ways to live up to the 
sanctions," the official said. 
    Nike did not immediately respond to request for comments.   
    North Korean athletes will also have to return Finnish 
hockey sticks, skates and other equipment the International Ice 
Hockey Federation has "rented" for them when they leave South 
Korea, the official said.  
    The federation was not immediately available for comments.  
     
    FLIGHT RISK  
    South Korea's unification ministry said it had sought and 
received temporary permission from the United States to fly an 
airliner to North Korea this week.  
    The flight took South Korean athletes for training in a ski 
resort in the North on Wednesday, and brought North Korean 
athletes to the South on Thursday. 
    Any aircraft or ship visiting North Korea is banned for 180 
days from entering the United States. The exemption granted this 
week only applies to the latest flight, meaning U.S. approval is 
needed any time North Korean officials visit during the Olympics 
by airplane or ferry. 
    A spokesman for the U.S. State Department said Washington 
was in "close contact with the Republic of Korea on our unified 
response to North Korea." 
    A U.S. Treasury official said the department evaluates 
applications "for certain prohibited transactions and 
activities, which can include those related to the upcoming 
Olympics", without giving more detail.  
    For this week's flight, an Airbus  AIR.PA  aircraft was used 
rather than one made by U.S. Boeing  BA.N  due to stricter U.S. 
sanctions, South Korean broadcaster Channel A reported. Asiana 
Airlines  020560.KS , who operated the plane, declined to 
comment. 
    To comply with South Korean military rules, the airliner  
had to fly some distance out to sea to avoid flying over the 
heavily fortified Demilitarised Zone, the unification ministry 
said. 
             
    FIVE-STAR HOTEL 
    The North Korean Olympians are staying at the athletes' 
village in Gangneung with athletes from other countries. The 
Olympics organising committee was unable to say whether they are 
being given any special treatment, such as beefed up protection. 
    North Korea's 230-member cheering squad is expected to stay 
at Inje Speedium, according to a unification ministry official, 
a four-star hotel surrounded by forest. Rooms there cost 242,000 
won ($226) to 715,000 won per night.  
    Its taekwondo performance team will stay at the five-star 
Grand Walkerhill in Seoul, which overlooks the Han River and 
previously hosted American stars such as Michael Jackson and 
Paris Hilton. 
    The spending is not unprecedented. When North Koreans 
visited the South for the Asian Games in 2002, the Seoul 
government spent 1.3 billion won hosting them.  
    But now, even paying for routine things such as medical 
treatment or providing souvenirs can run into problems, said Yoo 
Ho-yeol, a professor at Korea University in Seoul. 
    "Benefits provided to North Korean delegation, which were in 
the past were not subject to sanctions, can now become a 
controversy, since sanctions have become much more comprehensive 
in recent years," he said. 
 
 (Additional reporting by Josh Smith and Haejin Choi in SEOUL 
and David Brunnstrom, Siddharth Cavale and Karolos Grohmann; 
Editing by Soyoung Kim and Lincoln Feast) 
 ((hyunjoo.jin@thomsonreuters.com; 82-2-3704-5685; Reuters 
Messaging: hyunjoo.jin.thomsonreuters.com@reuters.net)) 
 
Keywords: OLYMPICS 2018/NORTHKOREA LOGISTICS