In the Matter of: Omega Engineering, Inc., One Omega Drive, Stamford, Connecticut 06907, Respondent.
The Bureau of Industry and Security, United States Department of Commerce (“BIS”), having notified Omega Engineering, Inc. (“Omega”) of its intention to initiate an administrative proceeding against it pursuant to section 13(c) of the Export Administration Act of 1979, as amended (50 U.S.C. app. §§ 2401-2420 (2000) (“Act”), and the Export Administration Regulations (currently codified at 15 CFR parts 730-774 (2003)) (“Regulations”), based on allegations in a proposed charging letter issued to Omega that alleged that Omega committed 17 violations of the Regulations. Specifically, the charges are:
1. Four Violations of § 764.2(a): Prohibited Conduct: Omega made a series of exports of laboratory equipment, including shipments on or about June 25, 1997, July 3, 1997, July 11, 1997, and July 16, 1997, that were routed from the United States to Pakistan via Newport Electronics GmbH (Newport) in Germany. This laboratory equipment included load cells, load bolts, strain gauges and related parts. By that means, Omega, through its Vice President Ralph Michel (Michel), conducted or caused to be conducted the same export transaction for which the Department of Commerce had denied authorization in response to an export license application previously submitted by Omega. On or about April 9, 1997, the Department of Commerce denied export license application Z097230, which Omega had submitted for the export of certain laboratory equipment from the United States to Pakistan. Omega appealed this denial pursuant to Section 756.2 of the Regulations. On or about May 5, 1997, the Under Secretary of Commerce for Export Administration sustained the Start Printed Page 65034denial of the license application. In making the shipments on the dates specified above, Omega engaged in conduct prohibited by or contrary to the denial of export license application Z097230 and the Under Secretary's upholding of that denial, thereby committing four violations of Section 764.2(a) of the Regulations.
2. Twelve Violations of 15 CFR 764.2(g): False Statements: On or about June 25, July 3, July 11, and July 16, 1997, Omega, through an employee, submitted or caused to be submitted a Shipper's Export Declaration (SED) regarding one of the shipments described above. Michel knew that items ultimately destined for Pakistan were included in such shipments to Newport in Germany, and then were to be shipped from Germany to Pakistan. Each SED falsely identified Newport as the ultimate consignee and Germany as the country of ultimate destination. Each SED also stated that the export qualified for export pursuant to “NLR” (no license required), when in fact a license was required, as the Department of Commerce had previously advised Omega. By submitting or causing to be submitted these four SED's, each of which contained these three false statements, Omega committed twelve violations of Section 764.2(g) of the Regulations.
3. One Violation of 15 CFR 764.2(e): Acting With Knowledge of a Violation: In making or causing to be made the above-described exports, Omega, through Michel, acted with knowledge that such exports were prohibited by or contrary to the Department of Commerce's denial of its export license application and the Under Secretary's sustaining of that denial, as described above. By selling and transferring the items described above with knowledge that such violation was about to occur and was intended to occur in connection with the items, Omega violated Section 764.2(e) of the Regulations.
BIS and Omega having entered into a Settlement Agreement pursuant to Section 766.18(a) of the Regulations whereby they agreed to settle this matter in accordance with the terms and conditions set forth therein, and the terms of the Settlement Agreement having been approved by me;
It Is Therefore Ordered:
First, that Omega shall pay a civil penalty of $187,000 to the U.S. Department of Commerce, as follows: $87,000 to be paid within 30 days from the date of entry of the Order; $50,000 to be paid within one year from the date of entry of the Order; and $50,000 to be paid within two years from the date of entry of the Order. At its option, Omega may accelerate this payment schedule. Payment shall be made in the manner specified in the attached instructions.
Second, that, pursuant to the Debt Collection Act of 1982, as amended (31 U.S.C. §§ 3701-3720E (1983 and Supp. 2000)), the civil penalty owed under this Order accrues interest as more fully described in the attached Notice, and, if payment is not made by the due date specified herein, Omega will be assessed, in addition to the full amount of the civil penalty and interest, a penalty charge and an administrative charge, as more fully described in the attached Notice.
Third, that the timely payment of the civil penalty set forth above is hereby made a condition to the granting, restoration, or continuing validity of any export license, license exception, permission, or privilege granted, or to be granted, to Omega. Accordingly, if Omega should fail to pay the civil penalty in a timely manner, the undersigned may enter an Order denying all of Omega's export privileges for a period of one year from the date of entry of this Order.
Fourth, that for a period of five years from the date of this Order, Omega Engineering, Inc., One Omega Drive, Stamford, Connecticut, 06907, its successors or assigns, and, when acting for or on behalf of Omega, its officers, representatives, agents or employees “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”) that is subject to the Regulations and that is exported or to be exported from the United States to Pakistan, or in any other activity subject to the Regulations that involves Pakistan, including, but not limited to:
A. Applying for, obtaining, or using any license, License Exception, or export control document that involves export to Pakistan;
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 that is subject to the Regulations and that is exported or to be exported from the United States to Pakistan, or in any other activity subject to the Regulations that involves Pakistan; or
C. Benefitting in any way from any transaction involving any item exported or to be exported from the United States to Pakistan that is subject to the Regulations, or in any other activity subject to the Regulations that involves Pakistan.
Fifth, 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 and that has been, will be, or is intended to be exported or reexported to Pakistan:
A. Export or reexport to or on behalf of a Denied Person any item subject to the Regulations to Pakistan;
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 to Pakistan, 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 to Pakistan;
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 to Pakistan; 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 to Pakistan 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 to Pakistan. For purposes of this paragraph, servicing means installation, maintenance, repair, modification or testing.
Sixth, 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 Omega by affiliation, ownership, control, or position of responsibility in the conduct of trade or related services may also be subject to the provisions of this Order.
Seventh, that this Order does not prohibit any export, reexport, or other transaction subject to the Regulations where the only items involved that are subject to the Regulations are the foreign-produced direct product of U.S.-origin technology.
Eighth, that the proposed charging letter, the Settlement Agreement, and this Order shall be made available to the public.Start Printed Page 65035
This Order, which constitutes the final agency action in this matter, is effective immediately.Start Signature
Entered this 12th day of November 2003.
Julie L. Myers,
Assistant Secretary of Commerce for Export Enforcement.
1. From August 21, 1994 through November 12, 2000, the Act was in lapse. During that period, the President, through Executive Order 12924, which had been extended by successive Presidential Notices, the last of which was August 3, 2000 (3 CFR, 2000 Comp. 397 (2001)), continued the Regulations in effect under the International Emergency Economic Powers Act (50 U.S.C. 1701-1706 (2000)) (“IEEPA”). On November 13, 2000, the Act was reauthorized and it remained in effect through August 20, 2001. Since August 21, 2001, the Act has been in lapse and the President, through Executive Order 13222 of August 17, 2001 (3 CFR, 2001 Comp. 783 (2002)), as extended by the Notice of August 7, 2003 (68 FR 47833, August 11, 2003)), has continued the Regulations in effect under IEEPA.Back to Citation
2. The Regulations are currently codified in the Code of Federal Regulations at 15 CFR parts 730-774 (2003). The current version of the Regulations govern the procedural aspects of this case. The charged violations occurred in 1997. The Regulations governing the charged violations are found in the 1997 version of the Code of Federal Regulations (15 CFR parts 730-774 (1997)).Back to Citation
[FR Doc. 03-28796 Filed 11-17-03; 8:45 am]
BILLING CODE 3510-DT-M