A hostel situated on the grounds of the North Korean embassy in Berlin has been shut down for good after a German court ruled that it breached international sanctions aimed at stopping financial flows to Pyongyang, a city official said on Friday.

Stephan von Dassel – head of the central district that hosts the North Korean embassy – told the German Press Agency (DPA) that a Berlin administrative court had rejected the hostel's final appeal against closure. The court ruled earlier on Tuesday that the hostel must shut down all operations.

"For us, the legal case is closed," von Dassel said. 

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Popular with backpackers

The embassy —  a legacy of the Cold War when North Korea retained diplomatic ties with Communist East Germany – has continued to operate since German reunification in 1990.

The embassy was closed after the fall of the Berlin Wall, but it reopened in 2001 and officials set about sub-letting rooms and parking spaces at the site.

One of its buildings was converted into a budget hostel which became popular with backpackers. 

The hostel was said to have been an important source of foreign income for North Korea. 

Violation of sanctions 

The hostel's operators reportedly leased the premises from the embassy for €38,000 ($42,000) per month under a contract agreed in 2016.

According to the Berlin court ruling, this breached United Nations sanctions and a European Union (EU) directive intended to stop the flow of hard currency to North Korea.

The UN explicitly banned such leasing arrangements by North Korean embassies globally as part the UN Security Council Resolution 2321 — passed in November 2016 after Pyongyang's fifth nuclear test.

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In November 2018, Berlin city authorities prohibited the hostel operator from using the property, citing an EU directive implementing the UN sanctions.

In a bid to stop the closure, the unnamed operators claimed they stopped paying rent to the embassy in April 2017 and that Berlin city authorities did not have the competency to order the hostel to be closed.

However, in January the court rejected their bid on the back of an EU directive that forbids any use of North Korean territory other than for diplomatic or consular purposes.

According to von Dassel, the appeal of that decision was rejected Thursday.

mvb/mm (AP, Reuters, AFP)

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