Italy has blocked the sale of two luxury yachts to North Korea because it suspects they were destined for Kim Jong-il, the country's ailing dictator, in a potential breach of international sanctions against Pyongyang.
A contract for the sale of the yachts, valued at about €12.5m ($17.8m), was terminated this month after an investigation by officials from the Italian ministry of economic development and the Guardia di Finanza, Italy's anti-fraud police, the Financial Times has learnt.
A deposit paid for the initial work on the two boats, which were confiscated by the ministry, has been returned to Azimut-Benetti, one of Italy's leading luxury yacht makers. Azimut built the yachts and still has them at its boatyard in Viareggio, near Pisa.
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