[Federal Register Volume 76, Number 44 (Monday, March 7, 2011)]
[Notices]
[Pages 12318-12322]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-5114]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
Action Affecting Export Privileges; Mahan Airways, Gatewick LLC;
Pejman Mahmood Kosarayanifard and Mahmoud Amini; Order Renewing Order
Temporarily Denying Export Privileges and Also Making That Temporary
Denial of Export Privileges Applicable to Related Persons)
Mahan Airways, Mahan Tower, No. 21, Azadegan St., M.A. Jenah Exp.
Way, Tehran, Iran;
Gatewick LLC, a/k/a Gatewick Freight & Cargo Services, a/k/a/
Gatewick Aviation Services, G22 Dubai Airport Free Zone,
P.O. Box 393754, Dubai, United Arab Emirates;
and
P.O. Box 52404, Dubai, United Arab Emirates;
and
Mohamed Abdulla Alqaz Building, Al Maktoum Street, Al Rigga, Dubai,
United Arab Emirates;
Pejman Mahmood Kosarayanifard, a/k/a Kosarian Fard, P.O. Box 52404,
Dubai, United Arab Emirates;
Mahmoud Amini G22 Dubai Airport Free Zone, P.O. Box 393754,
Dubai, United Arab Emirates;
and
P.O. Box 52404, Dubai, United Arab Emirates;
[[Page 12319]]
and
Mohamed Abdulla Alqaz Building, Al Maktoum Street, Al Rigga, Dubai,
United Arab Emirates; )
Pursuant to Section 766.24 of the Export Administration
Regulations, 15 CFR Parts 730-774 (2010) (``EAR'' or the
``Regulations''), I hereby grant the request of the Bureau of Industry
and Security (``BIS'') to renew for 180 days the September 3, 2010
Order Temporarily Denying the Export Privileges of Mahan Airways and
Gatewick LLC (``TDO''), as I find that renewal of the TDO is necessary
in the public interest to prevent an imminent violation of the EAR.\1\
Additionally, pursuant to Section 766.23 of the Regulations, including
the provision of notice and an opportunity to respond, I find it
necessary to add the following persons as related persons in order to
prevent evasion of the TDO:
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\1\ The September 3, 2010 Order was published in the Federal
Register on September 15, 2010.
Pejman Mahmood Kosarayanifard, a/k/a Kosarian Fard, P.O. Box 52404,
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Dubai, United Arab Emirates;
and
Mahmoud Amini, G22 Dubai Airport Free Zone, P.O. Box 393754,
Dubai, United Arab Emirates;
and
P.O. Box 52404, Dubai, United Arab Emirates;
and
Mohamed Abdulla Alqaz Building, Al Maktoum Street Al Rigga, Dubai,
United Arab Emirates.
I. Procedural History
On March 17, 2008, Darryl W. Jackson, the then-Assistant Secretary
of Commerce for Export Enforcement (``Assistant Secretary''), signed a
TDO denying Mahan Airways' export privileges for a period of 180 days
on the grounds that its issuance was necessary in the public interest
to prevent an imminent violation of the Regulations. The TDO also named
as denied persons Blue Airways, of Yerevan, Armenia (``Blue Airways of
Armenia''), as well as the ``Balli Group Respondents,'' namely, Balli
Group PLC, Balli Aviation, Balli Holdings, Vahid Alaghband, Hassan
Alaghband, Blue Sky One Ltd., Blue Sky Two Ltd., Blue Sky Three Ltd.,
Blue Sky Four Ltd., Blue Sky Five Ltd., and Blue Sky Six Ltd., all of
the United Kingdom. The TDO was issued ex parte pursuant to Section
766.24(a), and went into effect on March 21, 2008, the date it was
published in the Federal Register.
On July 18, 2008, in accordance with Section 766.23 of the
Regulations, Assistant Secretary Jackson issued an Order adding to the
TDO both Blue Airways FZE, of Dubai, United Arab Emirates (``the
UAE''), and Blue Airways, also of Dubai, United Arab Emirates (``Blue
Airways UAE''), as persons related to Blue Airways of Armenia. (Blue
Airways of Armenia, Blue Airways FZE, and Blue Airways UAE are
hereinafter collectively referred to as the ``Blue Airways
Respondents'').\2\
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\2\ The Related Persons Order was published in the Federal
Register on July 24, 2008.
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On September 17, 2008, Assistant Secretary Jackson renewed the TDO
for an additional 180 days in accordance with Section 766.24 of the
Regulations, via an order effective upon issuance, and on March 16,
2009, the TDO was similarly renewed by then-Acting Assistant Secretary
Kevin Delli-Colli.\3\ On September 11, 2009, Acting Assistant Secretary
Delli-Colli renewed the TDO for an additional 180 days against Mahan
Airways.\4\ BIS did not seek renewal of the TDO against the Blue
Airways Respondents, which BIS believed at that time had ceased
operating, or against the Balli Group Respondents.
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\3\ The September 17, 2008 Renewal Order was published in the
Federal Register on October 1, 2008. The March 16, 2009 Renewal
Order was published in the Federal Register on March 25, 2009.
\4\ The September 11, 2009 Renewal Order was published in the
Federal Register on September 18, 2009.
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On March 9, 2010,\5\ and September 3, 2010, I renewed the TDO
against Mahan Airways for an additional 180 days. The September 3, 2010
Renewal Order added Gatewick LLC (``Gatewick'') to the TDO as a related
person in accordance with Section 766.23, after written notice to
Gatewick and consideration of its August 26, 2010 response, which was
signed and submitted by Mahmoud Amini as Gatewick's General Manager. As
discussed in the September 3, 2010 Renewal Order, that response
confirmed Gatewick's role as Mahan Airway's sole booking agent for
cargo and freight forwarding services in the UAE.
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\5\ The March 9, 2010 Renewal Order was published in the Federal
Register on March 18, 2010.
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On February 7, 2011, BIS, through its Office of Export Enforcement
(``OEE''), filed a written request for renewal of the TDO against Mahan
Airways and Gatewick. Notice of the renewal request was provided to
Mahan Airways and Gatewick by delivery of a copy of the request in
accordance with Sections 766.5 and 766.24(d) of the Regulations. No
opposition to any aspect of renewal of the TDO has been received from
Mahan Airways, while Gatewick has not at any time appealed the related
person determination I made as part of the September 3, 2010 Renewal
Order.\6\
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\6\ A party named or added as a related person may not oppose
the issuance or renewal of the underlying temporary denial order,
but may file an appeal of the related person determination in
accordance with Section 766.23(c).
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Additionally, BIS has requested that I add both Pejman Mahmood
Kosarayanifard a/k/a Kosarian Fard (``Kosarian Fard'') and Mahmoud
Amini as related persons in accordance with Section 766.23. Both
Kosarian Fard and Mahmoud Amini were provided notice of BIS's intent to
add them to the TDO pursuant to Section 766.23(b) of the Regulations.
No opposition was received from Kosarian Fard, while Mahmoud Amini
submitted a short e-mail response received on October 17, 2010,
opposing his addition to the TDO.\7\
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\7\ The e-mail response from Amini is dated October 13, 2010 but
was received by BIS on October 17, 2010.
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II. Renewal of the TDO
A. Legal Standard
Pursuant to Section 766.24(d)(3) of the EAR, the sole issue to be
considered in determining whether to continue a TDO is whether the TDO
should be renewed to prevent an ``imminent'' violation of the EAR as
defined in Section 766.24. ``A violation may be `imminent' either in
time or in degree of likelihood.'' 15 CFR 766.24(b)(3). BIS may show
``either that a violation is about to occur, or that the general
circumstances of the matter under investigation or case under criminal
or administrative charges demonstrate a likelihood of future
violations.'' Id. As to the likelihood of future violations, BIS may
show that ``the violation under investigation or charges is
significant, deliberate, covert and/or likely to occur again, rather
than technical and negligent [.]'' Id. A ``lack of information
establishing the precise time a violation may occur does not preclude a
finding that a violation is imminent, so long as there is sufficient
reason to believe the likelihood of a violation.'' Id.
B. The TDO and BIS's Request for Renewal
OEE's request for renewal is based upon the facts underlying the
issuance of the initial TDO and the TDO renewals in this matter and the
evidence developed over the course of this investigation indicating
Mahan Airways' clear willingness to continue to disregard U.S. export
controls and the TDO. The initial TDO was issued as a result of
evidence that showed that Mahan Airways and other parties engaged in
conduct prohibited by the
[[Page 12320]]
EAR by knowingly re-exporting to Iran three U.S.-origin aircraft,
specifically Boeing 747s (``Aircraft 1-3''), items subject to the EAR
and classified under Export Control Classification Number (``ECCN'')
9A991.b, without the required U.S. Government authorization. Further
evidence submitted by BIS indicated that Mahan Airways was involved in
the attempted re-export of three additional U.S.-origin Boeing 747s
(``Aircraft 4-6'') to Iran.
As discussed in the September 17, 2008 TDO Renewal Order, evidence
presented by BIS indicated that Aircraft 1-3 continued to be flown on
Mahan Airways' routes after issuance of the TDO, in violation of the
Regulations and the TDO itself.\8\ It also showed that Aircraft 1-3 had
been flown in further violation of the Regulations and the TDO on the
routes of Iran Air, an Iranian Government airline. In addition, as more
fully discussed in the March 16, 2009 Renewal Order, in October 2008,
Mahan Airways caused Aircraft 1-3 to be deregistered from the Armenian
civil aircraft registry and subsequently registered the aircraft in
Iran. The aircraft were relocated to Iran and were issued Iranian tail
numbers, including EP-MNA and EP-MNB, and continued to be operated on
Mahan Airways' routes in violation of the Regulations and the TDO.
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\8\ Engaging in conduct prohibited by a denial order violates
the Regulations. 15 CFR 764.2(a) and (k).
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Moreover, as discussed in the September 11, 2009 and March 9, 2010
Renewal Orders, Mahan Airways continued to operate at least two of
Aircraft 1-3 in violation of the Regulations and the TDO,\9\ and also
committed an additional knowing and willful violation of the
Regulations and the TDO when it negotiated for and acquired an
additional U.S.-origin aircraft. The additional aircraft was an MD-82
aircraft, which was subsequently painted in Mahan Airways livery and
flown on multiple Mahan Airways' routes under tail number TC-TUA.
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\9\ The third Boeing 747 appeared to have undergone significant
service maintenance and may not have been operational at the time of
the March 9, 2010 Renewal Order.
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The March 9, 2010 Renewal Order also noted that a court in the
United Kingdom (``U.K.'') had found Mahan Airways in contempt of court
on February 1, 2010, for failing to comply with that court's December
21, 2009 and January 12, 2010 orders compelling Mahan Airways to remove
the Boeing 747s from Iran and ground them in the Netherlands. Mahan
Airways and the Balli Group Respondents have been litigating before the
U.K. court concerning ownership and control of Aircraft 1-3. Blue
Airways LLC also has been a party to that litigation. In a letter to
the U.K. court dated January 12, 2010, Mahan Airways' Chairman
indicated, inter alia, that Mahan Airways opposes U.S. Government
actions against Iran, that it continued to operate the aircraft on its
routes in and out of Tehran (and had 158,000 ``forward bookings'' for
these aircraft), and that it wished to continue to do so and would pay
damages if required by that court, rather than ground the aircraft.
The September 3, 2010 Renewal Order pointed out that Mahan Airways'
violations of the TDO extended beyond operating U.S.-origin aircraft in
violation of the TDO and attempting to acquire additional U.S.-origin
aircraft. In February 2009, while subject to the TDO, Mahan Airways
participated in the export of computer motherboards, items subject to
the Regulations and designated as EAR99, from the United States to
Iran, via the UAE, in violation of both the TDO and the Regulations, by
transporting and/or forwarding the computer motherboards from the UAE
to Iran. Mahan Airways' violations were facilitated by Gatewick, which
not only participated in the transaction, but also has stated to BIS
that it is Mahan Airways' sole booking agent for cargo and freight
forwarding services in the UAE.
Additional evidence obtained by OEE indicates that Aircraft 1-3
remain in Mahan Airways' possession, control, and livery in Tehran,
Iran. In a recent January 24, 2011 filing in the U.K. Court, Mahan
Airways asserted that Aircraft 1-3 are not being used, but stated in
pertinent part that the aircraft are being maintained especially ``in
an airworthy condition'' and that, depending on the outcome of its U.K.
Court appeal, the aircraft ``could immediately go back into service * *
* on international routes into and out of Iran.'' Mahan Airways'
January 24, 2011 submission to U.K. Court of Appeal, at p. 25,
paragraphs 108,110. This clearly stated intent, both on its own and in
conjunction with Mahan Airways' prior misconduct and statements,
demonstrates the need to renew the TDO in order to prevent imminent
future violations.
C. Findings
Under the applicable standard set forth in Section 766.24 of the
Regulations and my review of the record here, I find that the evidence
presented by BIS convincingly demonstrates that Mahan Airways has
repeatedly violated the EAR and the TDO, that such knowing violations
have been significant, deliberate and covert, and that there is a
likelihood of future violations. I find that, as alleged by OEE, the
violations have involved both U.S.-origin aircraft and computer
motherboards that are subject to the Regulations. A renewal of the TDO
is needed to give notice to persons and companies in the United States
and abroad that they should continue to cease dealing with Mahan
Airways in export transactions involving items subject to the EAR. Such
a
TDO is consistent with the public interest to prevent imminent
violation of the EAR.\10\
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\10\ My findings are made pursuant to Section 766.24 and the
Regulations, and are not based on the contempt finding against Mahan
Airways in the U.K. litigation. I note, however, that Mahan Airways'
statements and actions in that litigation are consistent with my
findings here.
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Accordingly, I find pursuant to Section 766.24 that renewal of the
TDO for 180 days against Mahan Airways is necessary in the public
interest to prevent an imminent violation of the EAR.
III. Addition of Related Persons
A. Legal Standard
Section 766.23 of the Regulations provides that ``[i]n order to
prevent evasion, certain types of orders under this part may be made
applicable not only to the respondent, but also to other persons then
or thereafter related to the respondent by ownership, control, position
of responsibility, affiliation, or other connection in the conduct of
trade or business. Orders that may be made applicable to related
persons include those that deny or affect export privileges, including
temporary denial orders * * * '' 15 CFR 766.23(a).
B. Analysis and Findings
OEE has requested that Kosarian Fard and Mahmoud Amini be added as
related persons in order to prevent evasion of the TDO. As noted above,
both individuals were provided written notice of OEE's intent to add
them as a related person to the TDO. Kosarian Fard did not respond,
while Mahmoud Amini sent only a short e-mail to OEE received on October
17, 2010. As discussed in the September 3, 2010 Order, a significant
business relationship or connection exists between Gatewick and Mahan
Airways. Gatewick had previously told BIS during a 2009 post shipment
verification that Gatewick acts as Mahan Airways' sole booking agent
for cargo and freight forwarding services in the UAE, a major
transshipment hub. In its
[[Page 12321]]
August 26, 2010 response, Gatewick confirmed this relationship and
provided a copy of the General Cargo Sales Agreement (``GSA'') between
Gatewick and Mahan Airways, signed on Gatewick's behalf by Kosarian
Fard, its owner and managing director. No challenge or assertion has
been made by Gatewick, or by Kosarian Fard or Mahmoud Amini, that this
relationship has ceased. Gatewick continues, in short, to have the
ability, with Mahan Airways' authorization and agreement, to use
Mahan's import code to clear UAE customs and then re-book cargo on
outbound Mahan flights, including to Iran.
Gatewick's corporate registration documents revealed other
connections or relationships between Gatewick, Kosarian Fard, and Mahan
Airways, as well as the Blue Airways Respondents. Moreover, as
discussed infra, Kosarian Fard's extensive connections to Mahan extend
well beyond his ownership interests and active participation at
Gatewick.
As previously discussed in the September 3, 2010 Renewal Order,
Kosarian Fard played a prominent role in Mahan Airways' acquisition of
Aircraft 1-3 discussed above, as indicated by evidence obtained by BIS
during its investigation and as acknowledged by Kosarian Fard in his
testimony in the U.K. litigation referenced above. Kosarian Fard was a
founder, the majority shareholder, and the Commercial Director of Blue
Airways of Armenia. In that capacity, he signed the Boeing 747 lease
agreements with the Balli Group that ultimately led to Mahan Airways'
acquisition of Aircraft 1-3 in violation of the Regulations. As
previously cited in the September 3, 2010 Renewal Order, Kosarian
Fard's written testimony in the U.K. litigation included the following
concerning his ``close relationship'' with Mahan Airways and some of
the acts he took at its direction:
As I have said, I was majority shareholder of Blue [Airways] but
in the summer of 2007, I agreed to sell a 51% stake in Blue to Skyco
(UK) Ltd. I did this at the request of Mahan. Given my close
relationship with Mahan, I did not ask questions but, again, acted
on the basis of the trust I had in Mr. Arabnejad and Mr. Mahmoudi
[two Mahan Airways' directors].
Kosarian Fard Written Statement to U.K. Commercial Court (signed and
dated May 27, 2009 by hand), at page 7, paragraph 12.
Kosarian Fard's ties to Mahan not only established the connection
between Mahan and Gatewick, but clearly demonstrate his own long
standing and wide reaching business relationship with Mahan. In
addition, Kosarian Fard has not contested BIS's related person's
notice. In accordance with all of the foregoing, I find that Kosarian
Fard is a related person under Section 766.23 and should be added to
the TDO to prevent evasion of the Order.
As indicated above, Mahmoud Amini did make a short response to the
related person's notice via an e-mail received on October 17, 2010. In
that e-mail, Amini asserted that his ``position in Gatewick aviation
services is only domestic, General Manager,'' and that he is ``not
``official manager of the company[.]'' This effort by Amini to limit or
discount his role at Gatewick is undermined, however, by the fact that
less than two months earlier, he signed Gatewick's August 26, 2010
submission to BIS as its ``General Manager'' and in doing so made no
assertion that his duties were ``only domestic.'' In addition, given
the nature and significance of a General Manager, Amini is positioned
to significantly determine Gatewick's conduct and activities, as also
evidenced by the central role he played in Gatewick's August 26, 2010
submission to BIS, hardly what one would expect of an employee with
duties that are ``only domestic'' and unrelated to the significant
Gatewick-Mahan Airways relationship.
Amini also asserted in his e-mail that the ``only division of
Gatewick'' in ``contact with Mahan'' is ``Gatewick freight and
cargo[.]'' Amini provides no supporting evidence for this assertion. In
addition, he never made such a distinction in his submission on
Gatewick's behalf on August 26, 2010, and no such distinction is made
in the GSA between Mahan Airways and Gatewick.
Accordingly, I find that based on his position of authority and
responsibility at Gatewick and Gatewick's significant business or trade
ties with Mahan Airways, Mahmoud Amini is related not only to Gatewick,
but also in the conduct of trade or business to Mahan Airways. Like
Kosarian Fard, Mahmoud Amini should be added to the TDO as a related
person under Section 766.23 in order to prevent evasion of that order.
IV. Order
It is therefore ordered:
First, that Mahan Airways, Mahan Tower, No. 21, Azadegan St., M.A.
Jenah Exp. Way, Tehran, Iran; Gatewick LLC, A/K/A Gatewick Freight &
Cargo Services, A/K/A Gatewick Aviation Service, G22 Dubai
Airport Free Zone, P.O. Box 393754, Dubai, United Arab Emirates, and
P.O. Box 52404, Dubai, United Arab Emirates, and Mohamed Abdulla Alqaz
Building, Al Maktoum Street, Al Rigga, Dubai, United Arab Emirates;
Pejman Mahmood Kosarayanifard A/K/A Kosarian Fard, P.O. Box 52404,
Dubai, United Arab Emirates; and Mahmoud Amini, G22 Dubai
Airport Free Zone, P.O. Box 393754, Dubai, United Arab Emirates, and
P.O. Box 52404, Dubai, United Arab Emirates, and Mohamed Abdulla Alqaz
Building, Al Maktoum Street, Al Rigga, Dubai, United Arab Emirates; and
when acting for or on their behalf, any successors or assigns, agents,
or employees (each a ``Denied Person'' and collectively the ``Denied
Persons'') may not, directly or indirectly, participate 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 Export
Administration Regulations (``EAR''), or in any other activity subject
to the EAR 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 EAR, or in any other activity
subject to the EAR; or
C. Benefiting in any way from any transaction involving any item
exported or to be exported from the United States that is subject to
the EAR, or in any other activity subject to the EAR.
Second, that no person may, directly or indirectly, do any of the
following:
A. Export or reexport to or on behalf of a Denied Person any item
subject to the EAR;
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 EAR 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 EAR that has been exported from the United States;
D. Obtain from a Denied Person in the United States any item
subject to the EAR with knowledge or reason to know
[[Page 12322]]
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 EAR
that has been or will be exported from the United States and which 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 EAR
that has been or will be exported from the United States. For purposes
of this paragraph, servicing means installation, maintenance, repair,
modification or testing.
Third, that, after notice and opportunity for comment as provided
in section 766.23 of the EAR, any other person, firm, corporation, or
business organization related to a Denied Person 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
this Order.
Fourth, 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.
In accordance with the provisions of Sections 766.24(e) and
766.23(c)(2) of the EAR, Mahan Airways, Gatewick LLC, Mahmoud Amini
and/or Kosarian Fard may, at any time, appeal this Order by filing a
full written statement in support of the appeal with the Office of the
Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40
South Gay Street, Baltimore, Maryland 21202-4022.\11\
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\11\ A party named or added to temporary denial order as a
related person may appeal its inclusion as a related person, but not
the underlying basis for the issuance of the TDO. See Section
766.23(c).
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In accordance with the provisions of Section 766.24(d) of the EAR,
BIS may seek renewal of this Order by filing a written request not
later than 20 days before the expiration date. A renewal request may be
opposed by Mahan Airways as provided in Section 766.24(d), by filing a
written submission with the Assistant Secretary of Commerce for Export
Enforcement, which must be received not later than seven days before
the expiration date of the Order.
A copy of this Order shall be provided to Mahan Airways and each
related person and shall be published in the Federal Register. This
Order is effective immediately and shall remain in effect for 180 days.
Dated: February 25, 2011.
David W. Mills,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2011-5114 Filed 3-4-11; 8:45 am]
BILLING CODE 3510-DT-P