UN set to sanction three N.Koreans, two entities -draft
* US says new sanctions boost existing ones
* Security Council to vote on Thursday
UNITED NATIONS, March 6 (Reuters) - The U.N. Security Council is set to blacklist two North Korean enterprises and three individuals working for North Korean entities involved in arms trade and Pyongyang's missile program, according to a draft resolution.
The draft, which the United States delivered to the council on Tuesday, was the product of three weeks of bilateral negotiations between the United States and China in response to North Korean's third nuclear test on Feb. 12. The 15-nation council is hoping to put it to a vote on Thursday.
The resolution, which council diplomats say is intended to bring the North Korea sanctions regime more in line with tough U.N. measures in place against Iran, would have the council "expressing the gravest concern at the nuclear test conducted by the Democratic People's Republic of Korea (North Korea)."
The three individuals to be blacklisted include Yon Chong Nam, chief representative of the Korea Mining Development Trading Corporation (KOMID), which has been under U.N. sanctions since 2009.
KOMID is North Korea's primary arms dealer and main exporter of goods and equipment related to ballistic missiles and conventional weapons, the draft says.
Yon's deputy at KOMID, Ko Chol Chae, is also to be blacklisted, along with Mun Chong Chol, an official at Tanchon Commercial Bank. Tanchon was added to the U.N. blacklist in 2009 as the main North Korean financier for sales of conventional weapons and ballistic missiles, and goods related to assembly and manufacture of conventional arms and missiles.
The North Korean entities to be blacklisted include the Second Academy of Natural Sciences, which the draft says is "a national-level organization responsible for research and development of the DPRK's advanced weapons systems, including missiles and probably nuclear weapons."
The other is Korea Complex Equipment Import Corporation, a subsidiary of Korea Ryonbong General Corporation.
Korea Ryonbong was blacklisted in April 2009. The draft resolution says it is "a defense conglomerate specializing in acquisition for DPRK defense industries and support to ... military-related sales."
U.S. Ambassador to the United Nations Susan Rice said on Tuesday that the new draft resolution "builds up, strengthens and significantly expands the scope of the strong U.N. sanctions already in place."
She said the new sanctions would target "the illicit activities of North Korean diplomatic personnel, North Korean banking relationships, (and) illicit transfers of bulk cash."
The draft resolution says council members are "concerned that the DPRK is abusing the privileges and immunities accorded under the Vienna Convention on Diplomatic and Consular Relations."
Envoys say the new resolution may open the door to possible expulsions of North Korean diplomats around the world, some of whom they say are involved in illicit transfers of cash and other activities intended to help North Korea flout sanctions.
Echoing language used in sanctions resolutions on Iran to crack down on Iranian financial activities, the draft calls on U.N. states not to open any "new branches, subsidiaries, or representative offices" of North Korean banks and not to engage in any joint ventures or correspondence relations with them.
The draft also calls for ending a loophole that has enabled Pyongyang's elite to skirt the U.N. ban on luxury goods approved after North Korea's first nuclear test in 2006. Until now, countries were left to decide what constituted luxury items and many states have not agreed on any list of banned items.
The draft names a few specific luxury goods it wants banned along with other items individual states consider to fall in that category - yachts, luxury automobiles, racing cars, jewelry with pearls, gems, precious and semi-precious stones and jewelry using precious metals.
Once the new resolution is approved, countries will be required to inspect any suspicious land, sea or air cargo, including luxury goods.
Pyongyang was hit with U.N. sanctions for its 2006 and 2009 nuclear tests, measures that were subsequently tightened and expanded after several rocket launches. In addition to the luxury goods ban, there is an arms embargo on North Korea, and it is forbidden from trading in nuclear and missile technology. (Reporting By Louis Charbonneau)
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