The Bureau of Industry and Security, U.S. Department of Commerce (“BIS”) has initiated an administrative proceeding against Elecmat, Inc. (hereinafter referred to as “Elecmat”) pursuant to Section 766.3 of the Export Administration Regulations (“Regulations”)  and Section 13(c) of the Export Administration Act of 1979, as amended (“Act”),  through issuance of a charging letter to Elecmat that alleged that Elecmat committed 39 violations of the Regulations. Specifically, the charges are:
Charge 1: 15 CFR 764.2(d)—Conspiracy To Export Items From the United States to Taiwan Without the Required License
Beginning in or about 2003 and continuing through on or about July 29, 2006, Elecmat conspired and acted in concert with others, known and unknown, to violate the Regulations and to bring about an act that constitutes a violation of the Regulations. The purpose of the conspiracy was to export items from the United States to Taiwan without the required U.S. Government authorization. Pursuant to Sections 742.2 and 742.3 of the Regulations, authorization was required from the Department of Commerce before certain chemicals, metals, and electronic components, items subject to the Regulations and classified under Export Control Classification Numbers (“ECCNs”) 1C227, 1C229, 1C231, 1C234, 1C240, and 1C350, could be exported from the United States to Taiwan.
In furtherance of the conspiracy, the conspirators, including Elecmat, participated in a scheme in which a Taiwan company requested that Elecmat procure specific items from U.S. suppliers and export them to Taiwan. The Taiwan company instructed Elecmat not to tell U.S. suppliers that Elecmat would export the items. Pursuant to this instruction, Elecmat procured the items and exported them to Taiwan without the required license. In so doing, Elecmat committed one violation of Section 764.2(d) of the Regulations. Start Printed Page 5813
Charges 2-19: 15 CFR 764.2(a)—Engaging in Prohibited Conduct by Exporting Certain Chemicals, Metals and Electronic Components Without the Required License
On 18 occasions between on or about August 13, 2003 and on or about May 13, 2006, Elecmat engaged in conduct prohibited by the Regulations by exporting items subject to the Regulations to Taiwan without the required Department of Commerce licenses. Specifically, Elecmat exported certain chemicals, metals, and electronic components, classified under ECCNs 1C227, 1C229, 1C231, 1C234, and 1C240, to an affiliated company in Taiwan without the Department of Commerce licenses required by Section 742.3 of the Regulations. In so doing, Elecmat committed 18 violations of Section 764.2(a) of the Regulations.
Charge 20: 15 CFR 764.2(a)—Engaging in Prohibited Conduct by Exporting Certain Chemicals, Metals and Electronic Components Without the Required License
On one occasion on or about April 15, 2006, Elecmat engaged in conduct prohibited by the Regulations by exporting sodium fluoride, an item subject to the Regulations and classified under ECCN 1C350, to Taiwan without the Department of Commerce license required by Section 742.2 of the Regulations. In so doing, Elecmat committed one violation of Section 764.2(a) of the Regulations.
Charges 21-39: 15 CFR 764.2(e)—Acting with Knowledge of a Violation
On 19 occasions, between on or about August 13, 2003 and on or about May 13, 2006, in connection with the transactions described in Charges 2-25, above, Elecmat ordered, bought, sold, transported, and forwarded certain chemicals, metals, and electronic components, items that are subject to the Regulations, with knowledge that violations of the Regulations were about to occur or was intended to occur in connection with the items. Specifically, Elecmat had knowledge that these items required a license for export to Taiwan and that they were being exported without the required licenses. Elecmat had previously obtained export licenses from the Department of Commerce for exports of similar items to Taiwan, had been informed by a supplier that certain similar items could not be sold for export, had been informed by another supplier and an affiliated Taiwan company that the export of certain similar items required a license. In so doing, Elecmat committed 19 violations of Section 764.2(e) of the Regulations.
Whereas, BIS and Elecmat have entered into a Settlement Agreement pursuant to Section 766.18(b) of the Regulations whereby they agreed to settle this matter in accordance with the terms and conditions set forth therein, and
Whereas, I have approved of the terms of such Settlement Agreement;
It is therefore ordered:
First, that for a period of twenty years from the date of entry of this Order, Elecmat, Inc., 390 Utah Street, San Francisco, CA 94103, (“Elecmat”), its successors or assigns, and, when acting for or on behalf of Elecmat, its officers, representatives, agents or employees (“Denied Person(s)”) 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. Benefiting 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.
Second, 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.
Third, 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 Elecmat 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.
Fourth, that the charging letter, amended charging letter, the Settlement Agreement, and this Order, and the record of the cases as defined by Section 766.20 of the Regulations shall be made available to the public.
Fifth, that the Administrative Law Judge shall be notified that this case is withdrawn from adjudication.
Sixth, that this Order shall be served on the Denied Person and on BIS, and shall be published in the Federal Register.
This Order, which constitutes the final agency action in this matter, is effective immediately.Start Signature
Entered this 26th day of January 2009.
Acting Assistant Secretary for Export Enforcement.
1. The Regulations are currently codified in the Code of Federal Regulations at 15 CFR Parts 730-774 (2008). The charged violations occurred in 2003 through 2006. The Regulations governing the violations at issue are found in the 2003 through 2006 versions of the Code of Federal Regulations (15 CFR parts 730-774 (2003-2006)). The 2008 Regulations govern the procedural aspects of this case.Back to Citation
2. 50 U.S.C. app. §§ 2401-2420 (2000). 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)), which has been extended by successive Presidential Notices, the most recent being that of July 23, 2008 (73 FR 43,603 (July 25, 2008)), has continued the Regulations in effect under the International Emergency Economic Powers Act (50 U.S.C. 1701-1706 (2000)).Back to Citation
[FR Doc. E9-2170 Filed 1-30-09; 8:45 am]
BILLING CODE 3510-DT-P