[Federal Register Volume 75, Number 46 (Wednesday, March 10, 2010)]
[Notices]
[Pages 11113-11115]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-5107]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
Action Affecting Export Privileges; Aviation Services
International, B.V.
In the Matter of: Aviation Services International, B.V. also known
as Delta Logistics, B.V., P.O. Box 418, Heerhugowaard, Netherlands
1700AK and Flemming Straat 36, Heerhugowaard, Netherlands 1700AK
Respondent; Order Relating to Aviation Services International, B.V.
The Bureau of Industry and Security, U.S. Department of Commerce
(``BIS''), has initiated an administrative proceeding against Aviation
Services International, B.V., also known as Delta Logistics, B.V.
(collectively referred to herein as ``ASI'') pursuant to Section 766.3
of the Export Administration Regulations (currently codified at 15 CFR
parts 730-774 (2009)) (``EAR''),\1\ and Section 13(c) of the Export
Administration Act of 1979, as amended (50 U.S.C. app. Sec. Sec. 2401-
2420) (the
[[Page 11114]]
``EAA''),\2\ through issuance of a Proposed Charging Letter to ASI that
alleged that ASI committed one violation of the EAR. Specifically:
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\1\ The violation alleged by BIS occurred between 2005 and 2007.
The governing provisions of the EAR are found in the 2005-2007
versions of the Code of Federal Regulations (15 CFR Parts 730-774
(2005-2007)). The 2009 version of the EAR establishes the procedures
that apply to the BIS administrative proceeding.
\2\ Since August 21, 2001, the EAA has been in lapse and the
President, through Executive Order 13222 of August 17, 2001 (3 CFR,
2001 Comp. 783 (2002)), as extended most recently by the Notice of
August 13, 2009 (74 FR 41325 (August 14, 2009)), has continued the
EAR in effect under the International Emergency Economic Powers Act
(50 U.S.C. 1701, et seq.) (``IEEPA'').
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Charge 1 15 CFR 764.2(d)--Conspiracy
Between on or about October 1, 2005, and continuing through on or
about October 30, 2007, ASI conspired and acted in concert with others,
known and unknown, to violate the Regulations and to bring about acts
that constitute violations of the Regulations. The purpose of the
conspiracy was to export U.S.-origin items including aircraft parts,
electronic components, and polymide film on multiple occasions, from
the United States to Iran, via the Netherlands, Cyprus, and the United
Arab Emirates (``UAE''), without the required U.S. Government
authorization. Pursuant to section 746.7 of the Regulations,
authorization was required from OFAC before the aircraft parts,
electronic components, and polymide film, items subject to the
Regulations \3\ and the Iranian Transactions Regulations, 31 CFR part
560 (``ITR''), could be exported from the United States to Iran.
Pursuant to section 560.204 of the ITR, an export to a third country
intended for transshipment to Iran is a transaction subject to the ITR.
In furtherance of the conspiracy, ASI and its co-conspirators devised
and employed a scheme to purchase these items from the United States on
behalf of Iranian customers and give U.S. manufacturers false
information regarding the ultimate destination, end user, and end use
of the items, thereby causing false export control documents to be
submitted to the U.S. Government listing countries other than Iran as
the ultimate destination for the items. These acts were taken to export
U.S.-origin items to Iran without the required U.S. Government
authorization and avoid detection by law enforcement. By engaging in
this activity, ASI committed one violation of section 764.2(d) of the
Regulations.
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\3\ The items were classified as Export Control Classification
Numbers (``ECCN'') 9A991, 1C008.A.3, 5A991. Additionally, some of
the aircraft parts were designated EAR99, which is a designation for
items subject to the Regulations but not listed on the Commerce
Control List. (2005-2007).
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Whereas, BIS and ASI have entered into a Settlement Agreement
pursuant to Section 766.18 of the EAR, whereby they agreed to settle
this matter in accordance with the terms and conditions set forth
therein; \4\ and
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\4\ The Settlement Agreement also resolves allegations by the
U.S. Department of Treasury, Office of Foreign Assets Control
(``OFAC''), which is also a party to the Settlement Agreement, of
apparent violations of the Iranian Transactions Regulations, 31 CFR
part 560 (``ITR'' or the ``OFAC Regulations''). ASI's apparent
violations of the OFAC Regulations are contained in an OFAC
Prepenalty Notice that was issued by OFAC on or about September 24,
2009, identified as FAC Number IA-365318.
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Whereas, I have approved of the terms of the Settlement Agreement;
\5\
It is therefore ordered:
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\5\ This Order signifies my approval of the Settlement Agreement
based on the violations alleged in the Proposed Charging Letter, and
not the OFAC Prepenalty Notice referenced in note 4, supra.
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First, that a civil penalty of $250,000 is assessed against ASI.
Payment of the $250,000 penalty shall be suspended for a period of
three (3) years from the date the BIS Order is issued and thereafter
shall be waived provided that during the period of suspension, ASI has
committed no violation of the EAA, EAR or any order or license issued
thereunder.
Second, that for a period of seven (7) years from the date of this
Order, Aviation Services International, B.V., also known as Delta
Logistics, B.V., P.O. Box 418, Heerhugowaard, Netherlands 1700AK and
Fleming Straat 36, Heerhugowaard, Netherlands, 1700AK, its successors
or assigns, and, when acting for or on behalf of ASI, its officers,
representatives, agents or employees (``Denied Person'') may not
participate, directly or indirectly, in any way in any transaction
involving any commodity, software, or technology (hereinafter
collectively referred to as ``item'') exported or to be exported from
the United States that is subject to the Regulations, or in any other
activity subject to the Regulations, including, but not limited to:
A. Applying for, obtaining, or using any license, License
Exception, or export control document;
B. Carrying on negotiations concerning, or ordering, buying,
receiving, using, selling, delivering, storing, disposing of,
forwarding, transporting, financing, or otherwise servicing in any way,
any transaction involving any item exported or to be exported from the
United States that is subject to the Regulations, or in any other
activity subject to the Regulations; or
C. Benefitting in any way from any transaction involving any item
exported or to be exported from the United States that is subject to
the Regulations, or in any other activity subject to the Regulations.
Third, that no person may, directly or indirectly, do any of the
actions described below with respect to an item that is subject to the
Regulations that has been, will be, or is intended to be exported or
reexported from the United States:
A. Export or reexport to or on behalf of a Denied Person any item
subject to the Regulations;
B. Take any action that facilitates the acquisition or attempted
acquisition by a Denied Person of the ownership, possession, or control
of any item subject to the Regulations that has been or will be
exported from the United States, including financing or other support
activities related to a transaction whereby a Denied Person acquires or
attempts to acquire such ownership, possession or control;
C. Take any action to acquire from or to facilitate the acquisition
or attempted acquisition from a Denied Person of any item subject to
the Regulations that has been exported from the United States;
D. Obtain from a Denied Person in the United States any item
subject to the Regulations with knowledge or reason to know that the
item will be, or is intended to be, exported from the United States; or
E. Engage in any transaction to service any item subject to the
Regulations that has been or will be exported from the United States
and that is owned, possessed or controlled by a Denied Person, or
service any item, of whatever origin, that is owned, possessed or
controlled by a Denied Person if such service involves the use of any
item subject to the Regulations that has been or will be exported from
the United States. For purposes of this paragraph, servicing means
installation, maintenance, repair, modification or testing.
Fourth, that, after notice and opportunity for comment as provided
in Section 766.23 of the Regulations, any person, firm, corporation, or
business organization related to ASI by affiliation, ownership,
control, or position of responsibility in the conduct of trade or
related services may also be made subject to the provisions of the
Order.
Fifth, that this Order does not prohibit any export, reexport, or
other transaction subject to the EAR where the only items involved that
are subject to the EAR are the foreign-produced direct product of U.S.-
origin technology.
Sixth, that the Proposed Charging Letter, the Settlement Agreement,
and this Order shall be made available to the public.
[[Page 11115]]
Seventh, that this Order shall be served on the Denied Person and
shall be published in the Federal Register.
This Order, which constitutes the final BIS action in this matter,
is effective immediately.
Issued this 2nd day of March 2010.
David W. Mills,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2010-5107 Filed 3-9-10; 8:45 am]
BILLING CODE 3510-DT-P