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Action Affecting Export Privileges; Mahan Airways

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In the matter of: Mahan Airways, Mahan Tower, No. 21, Azadegan St., M.A. Jenah Exp. Way, Tehran, Iran; Respondent.

Order Renewing Order Temporarily Denying Export Privileges

Pursuant to Section 766.24 of the Export Administration Regulations, 15 CFR Parts 730-774 (2009) (“EAR” or the “Regulations”), I hereby grant the request of the Bureau of Industry and Security (“BIS”) to renew for 180 days the Order Temporarily Denying the Export Privileges of Respondent Mahan Airways (the “TDO”), as I find that renewal of the TDO is necessary in the public interest to prevent an imminent violation of the EAR.

I. Procedural History

On March 17, 2008, the Assistant Secretary of Commerce for Export Enforcement (“Assistant Secretary”) signed an Order Temporarily Denying the Export Privileges of Mahan Airways, as well as 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., Blue Sky Six Ltd, and Blue Airways, for 180 days on the grounds that its issuance was necessary in the public interest to prevent an imminent violation of the Regulations (“TDO”). 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, the Assistant Secretary issued an Order adding Blue Airways FZE and Blue Airways, both of Dubai, United Arab Emirates, as Related Persons to the TDO in accordance with Section 766.23 of the Regulations.[1] On September 17, 2008, the TDO was renewed for an additional 180 days in accordance with Section 766.24 of the Start Printed Page 47916Regulations via an order effective upon issuance.[2] On March 16, 2009, the TDO was renewed for an additional 180 days via an order that also was effective upon issuance.[3]

On August 20, 2009, BIS, through its Office of Export Enforcement (“OEE”), filed a written request for renewal of the TDO against Mahan Airways for an additional 180 days, and served a copy of its request on the Respondent in accordance with Section 766.5 of the Regulations. No opposition to renewal of the TDO has been received from Mahan Airways. BIS did not seek renewal of the TDO as to Balli Group PLC, Balli Aviation, Balli Holdings, Vahid Alaghband, Hassan Alaghband, Blue Sky One Ltd., Blue Sky Two Ltd., Blue Sky Three Ltd., and Blue Airways of Armenia. OEE also did not seek renewal as to the Related Persons Blue Airways and Blue Airways FZE of Dubai, United Arab Emirates.

II. Discussion

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 of the TDO is based upon the facts underlying the issuance of the initial TDO, as well as evidence developed over the course of this investigation indicating a clear willingness on the part of Mahan Airways to continue to disregard U.S. export controls and the TDO. The initial TDO was issued as a result of evidence that showed that the Mahan Airways along with other parties engaged in conduct prohibited by the 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 to Iran.

As more fully 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.[4] 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 have been issued Iranian tail numbers, including EP-MNA and EP-MNB, and continue to be operated on Mahan Airways' flights in violation of the Regulations and the TDO.

OEE seeks renewal of the TDO against Mahan Airways based on its participation in the violations discussed in the initial and renewed TDOs, as well as additional evidence of unlawful actions obtained by OEE since it last requested renewal of the TDO on February 24, 2009. In addition to the Boeing 747's discussed above, OEE has presented evidence as part of its current renewal request indicating that in early 2009, while subject to the TDO, Mahan Airways acquired an additional U.S.-origin aircraft in violation of the Regulations and the TDO itself. The additional aircraft is an MD-82 aircraft painted in Mahan Airways livery and currently flying under tail number TC-TUA.

C. Findings

In determining whether to renew the TDO in order to prevent imminent violation of the Regulations, I have reviewed the entire record, including OEE's current and prior submissions and related evidence. I find that violations of the Regulations have occurred and continue to occur involving the unlicensed re-export of three U.S.-origin 747s presently possessed by Mahan Airways. Moreover, the aircraft are currently located in Iran and are registered and/or operated by Mahan Airways in violation of the Regulations and the TDO. The likelihood of future violations by Mahan Airways is further heightened by its acquisition of the U.S.-origin MD-82 aircraft in clear violation of the TDO.

I find that the evidence presented by BIS convincingly demonstrates that Mahan Airways has continued to violate the EAR and the TDO and that such knowing violations have been significant, deliberate and covert, and that there is a likelihood of future violations. As such, a 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 violations of the EAR.

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. Order

It is therefore ordered: First, that the Respondent, MAHAN AIRWAYS, Mahan Tower, No. 21, Azadegan St., M.A. Jenah Exp.Way, Tehran, Iran (the “Denied Person”) 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 Start Printed Page 47917or 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 the Denied Person any item subject to the EAR;

B. Take any action that facilitates the acquisition or attempted acquisition by the 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 the 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 the Denied Person of any item subject to the EAR that has been exported from the United States;

D. Obtain from the Denied Person in the United States any item subject to the EAR 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 EAR that has been or will be exported from the United States and which is owned, possessed or controlled by the Denied Person, or service any item, of whatever origin, that is owned, possessed or controlled by the 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 the 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 Section 766.24(e) of the EAR, the Respondent 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.

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. The Respondent may oppose a request to renew this Order 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 served on the Respondent and shall be published in the Federal Register.

This Order is effective immediately and shall remain in effect for 180 days.

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Entered this 11th day of September 2009.

Kevin Delli-Colli,

Acting Assistant Secretary of Commerce for Export Enforcement.

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Footnotes

1.  The Related Persons Order was issued in accordance with Section 766.23 of the Regulations, 15 CFR 766.23, and was published in the Federal Register on July 24, 2008.

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2.  The September 17, 2008 Renewal Order was published in the Federal Register on October 1, 2008.

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3.  The March 16, 2009 Renewal order was published in the Federal Register on March 25, 2009.

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4.  Engaging in conduct prohibited by a denial order violates the Regulations. 15 CFR 764.2(a) and (k).

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[FR Doc. E9-22547 Filed 9-17-09; 8:45 am]

BILLING CODE 3510-D2-P