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Debarment Involving Hughes Network Systems (Beijing) Co. Ltd.

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Notice is hereby given that the Department of State has imposed an administrative debarment against Hughes Network Systems (Beijing) Co. Ltd. pursuant to a January 26, 2005 Consent Agreement and other authority based upon section 127.7(a) and (b)(2) of the International Traffic in Arms Regulations (ITAR) (22 CFR sections 120 to 130).


Effective Date: January 26, 2005.

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David Trimble, Director, Office of Defense Trade Controls Compliance, Bureau of Political-Military Affairs, Department of State (202) 663-2700.

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Section 127.7 of the ITAR authorizes the Assistant Secretary of State for Political-Military Affairs to debar any person who has been found pursuant to Section 128 of the ITAR to have committed a violation of the Arms Export Control Act (AECA) or the ITAR of such character as to provide a reasonable basis for the Office of Defense Trade Controls Compliance to believe that the violator cannot be relied upon to comply with the AECA or ITAR in the future. Such debarment prohibits the subject from participating directly or indirectly in the export of defense articles or defense services for which a license or approval is required by the ITAR.

Debarred persons are generally ineligible to participate in activity regulated under the ITAR (see e.g., sections 120.1(c) and (d), 126.7, 127.1(c), and 127.11(a)). The Department of State will not consider applications for licenses or requests for approvals that involve any debarred person.

Hughes Network Systems (Beijing) Co. Ltd. (HNS China), a wholly owned subsidiary of Hughes Network Systems Corporation (“HNS”), was under a Consent Agreement dated March 2003 for their activities related to failed launches in the People's Republic of China (PRC). The DirecTV Group Inc. (“DTV”), successor to Hughes Electronics Corporation, is the parent company of HNS. The internal investigation determined that many of the practices, which led to the March 2003 Consent Agreement had not been corrected within HNS China, and in fact, continued, in violation of the ITAR. As a result, on May 14, 2004, DDTC imposed a policy of denial against HNS for a period of one year.

On January 5, 2005, the Department of State served a Sanction Letter to DTV for violating terms of its 2003 Consent Agreement. On January 26, 2005, the Department and DTV and HNS entered a new Consent Agreement, which debarred HNS (China) until May 14, 2005.

Reinstatement after May 14, 2005 is not automatic, but is contingent on full compliance with the terms of the January 26, 2005 Consent Agreement and evidence that the underlying problems that gave rise to the violations have been addressed. At the end of the debarment period, licensing privileges may be reinstated only at the request of the debarred person following the necessary Departmental review. Until licensing privileges are reinstated, HNS China will remain debarred.

This notice is provided in order to make the public aware that the persons listed above are prohibited from participating directly or indirectly in any brokering activities and in any export from or temporary import into the United States of defense articles, related technical data, or defense services in all situations covered by the ITAR.

Exceptions may be made to this denial policy on a case-by-case basis at the discretion of the Directorate of Defense Trade Controls. However, such an exception would be granted only after a full review of all circumstances, paying particular attention to the following factors: whether an exception is warranted by overriding U.S. foreign policy or national security interest; whether an exception would further law enforcement concerns that are consistent with the foreign policy or national security interests of the United States; or whether other compelling circumstances exist that are consistent with the foreign policy or national security interests of the United States, and do not conflict with law enforcement concerns.

This notice involves a foreign affairs function of the United States encompassed within the meaning of the military and foreign affairs exclusion of the Administrative Procedure Act. Because the exercise of this foreign affairs function is discretionary, it is excluded from review under the Administrative Procedure Act.

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Dated: June 10, 2005.

Rose M. Likins,

Acting Assistant Secretary for Political-Military Affairs, Department of State.

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[FR Doc. 05-12011 Filed 6-16-05; 8:45 am]