U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-KSB
                [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999

                                       or

                [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                          COMMISSION FILE NO. 0-27359

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                 (Name of small business issuer in its charter)

         Texas                                                74-2653437
------------------------                             --------------------------
(state of incorporation)                             (IRS Employer I.D. Number)

                   500 North Shoreline Drive, Suite 701 North
                            Corpus Christi, TX 78471
                   ------------------------------------------
                      (Address principal executive offices)

                    Issuer's telephone number: 512-887-7546

         Securities registered under Section 12(b) of the Exchange Act:

                           Title of each class: None.

                Name of each exchange on which registered: None.

         Securities registered under Section 12(g) of the Exchange Act:

                         Common Stock, $0.001 par value
                         ------------------------------
                                (Title of class)

                        Preferred Stock, $0.001 par value
                        ---------------------------------
                                (Title of class)


     Check  whether  the  issuer  (1)  filed all reports required to be filed by
Section  13  or 15(d) of the Exchange Act during the past 12 months (or for such
shorter  period  that the registrant was required to file such reports), and (2)
has  been subject to such filing requirements for the past 90 days.  Yes [ ]  No
[X]

     Check  if  there  is no disclosure of delinquent filers in response to Item
405  of  Regulation  S-B  contained  in  this  form,  and  no disclosure will be
contained,  to  the  best  of  registrant's  knowledge,  in  definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or  any  amendment  to  this  Form  10-KSB.  [X]

<PAGE>
State  issuer's  revenues  for  its  most  recent  fiscal  year:  $10,000.

     State the aggregate market value of the voting and non-voting common equity
held  by  non-affiliates  computed by reference to the price at which the common
equity was sold, or the average bid and asked price of such common equity, as of
a  specified  date within the past 60 days:  $3,049,422 computed by reference to
the  $0.65  average  of the bid and asked price of the company's Common Stock on
August  29,  2001.

     State  the  number of shares outstanding of each of the issuer's classes of
common  equity, as of August 29, 2001:  5,624,218 shares of Common Stock, $0.001
par  value.

DOCUMENTS  INCORPORATED  BY  REFERENCE

     If  the following documents are incorporated by reference, briefly describe
them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into
which  the  document is incorporated: (1) any annual report to security holders;
(3) any proxy or information statement; and (3) any prospectus filed pursuant to
Rule  424(b)  or (c) of the Securities Act of 1933 ("Securities Act").  The list
documents  should be clearly described for identification purposes (e.g., annual
report  to  security  holders  for fiscal year ended December 24, 1990).   None.

Transitional  Small  Business  Disclosure  Format  (check  one): Yes [ ]  No [X]













                                       ii
<PAGE>
                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

Item     1.     Description  of  Business                                     1

                Business  Development                                         1
                Business  of  the  Company                                    4
                     Live  Tissue  Bonding  Equipment                         4
                     Anaerobic  Farm-Waste  Disposal  Equipment               5
                     Carbon  Dioxide  Separator                               7
                     Raw  Materials  and  Suppliers                           8
                Distribution  Methods                                         8
                Competition                                                   9
                Patents,  Trademarks  and  Licenses                           9
                Government  Approval  and  Regulations                        9
                Year  2000  Computer  Problems                               10
                Research  and  Development                                   10
                Cost  of  Compliance  with  Environmental  Laws              10
                Seasonality                                                  10
                Employees                                                    11

Item     2.     Properties                                                   11

Item     3.     Legal  Proceedings                                           11

Item     4.     Submission  of  Matters to a Vote of Security Holders        11

Item     5.     Market for Common Equity and Related Stockholder Matters     11

                Holders                                                      12
                Dividends                                                    12
                Recent  Sales  of  Unregistered  Securities                  12

Item     6.     Management's  Discussion  and  Analysis                      13

                Sales                                                        14
                Selling,  General  and  Administrative  Expenses             14
                Net  Loss                                                    14
                Liquidity  and  Outlook                                      15

Item     7.     Financial  Statements                                        15

Item     8.     None

Item     9.     Directors, Executive Officers, Promoters and
                  Control Persons; Compliance  with  Section  16(a)
                  of  the  Exchange  Act                                     28

Item     10.     Executive  Compensation                                     30

                                      iii
<PAGE>

Item     11.     Security Ownership of Certain Beneficial
                   Owners and Management                                     30

Item     12.     Certain  Relationships  and  Related  Transactions          31

Item     13.     Exhibits  and  Reports  on  Form  8-K                       31

                 Signatures.                                                 34























                                       iv
<PAGE>
ITEM     1.     DESCRIPTION  OF  BUSINESS.

Business  Development
---------------------

     We  were  incorporated  on  November  17,  1992  in the State of Texas.  We
conduct  our  business  from  our  headquarters  in  Corpus Christi, Texas; from
offices in Oklahoma City, Oklahoma; and from offices in Kiev, Ukraine.  We first
had  revenues  from  operations  in  1995.

     We  believe  we  are  unique  in  our  business mission.  We facilitate the
transfer  to the U.S. and other developed countries of technologies developed by
the  scientists  and  engineers  of  Ukraine.

     We  have  a  formal  relationship with several prestigious organizations in
Ukraine.  They have, as their stockholders or members, many of Ukraine's leading
scientists, engineers and technicians.  We formalized our relationship with them
in  February  1994  when  we  registered  with  the Ukraine Government a Ukraine
company  owned  50  percent  by  us and 50 percent by the Ukraine organizations.

     The  Ukraine  company's  name is United Engineering Company. It is called a
"joint  stock  company  with  a  foreign investor."  The foreign investor is us.
United  Engineering Company is authorized by Ukraine law, among other things, to
perform  classified  and  secret  construction  works  related  to  the national
security  of  Ukraine.

     The  50 percent of the stock of United Engineering Company owned by Ukraine
organizations  is  owned  by  the  following  companies  or  organizations:

     -    The State Property Fund of Ukraine.  It owns all state enterprises and
          property  of  the  state,  and  it  is  represented  by:

     -    Yuzhnoye  (Southern)  Machine  Building  Plant.  This  is  a  giant
          manufacturing complex located in Dniepropetrovsk. It built many of the
          missiles  and  nuclear missiles for the former Soviet Union. Today, it
          manufactures  commercial  satellites,  farming  tractors  for  export,
          trolley  cars,  and  other  heavy  products.

     -    Design  Bureau "Yuzhnoye".  This organization was established in 1954.
          It  developed  and turned over to the Ukraine Army several generations
          of  missiles  (specifically,  SS-18  "Satan"  satellite and the launch
          rockets  "Cyclone" and "Zinet"), space carrier rockets, and artificial
          satellites.  Design  Bureau  employs  several thousand researchers and
          production  engineers and is the leading enterprise in Ukraine for the
          development  of  rocket  and other jet systems. It also is the leading
          enterprise  for  the  elimination  of  launching sites in Ukraine. The
          Bureau  also  works  on conversion projects, trolley busses, pumps for
          the  oil industry, small-sized vehicles for cleaning city streets, and
          devices  for  manufacturing  margarine,  oils,  etc.  It  is under the
          direction of Academician Stanislav Nikolayevich Konyukhov, who also is
          president  of  United  Engineering  Company.

                                        1
<PAGE>

     -    Trust  No.  5  for  Special   Construction  Works.  This  organization
          believes  itself  to  be  the  highest  technical  and  most qualified
          engineering  firm  in  the  former  Soviet  Union.  It was involved in
          building  all  of  the  former  Soviet Union's nuclear and non-nuclear
          missile  launching  pads  and silos, the Soviet space station, several
          chemical  and   oil   industry  plants  and   pipelines,   and   other
          installations  requiring the highest technologies of the former Soviet
          Union.

     -    E.O.  Paton  Institute  of  Electric  Welding.  This  organization was
          founded  in  1934  by  the  Academy  of Sciences of the Ukraine S.S.R.
          It  is  headed  today  by  Professor Boris Paton, the president of the
          Ukraine  Academy   of   Sciences.   It   developed   the  collapsible,
          titanium-welded,  building-structure  technology  that was used in the
          construction  of the Soviet space station "MIRE." We believe the Paton
          Institute is one of the world's most prominent scientific institutions
          involved in metal  casting and  bonding  ceramics,  microwave  bonding
          of  metals  and  plastics,  explosive  welding and cutting, welding in
          space  and  underwater,  electro  metallurgy, protective coatings, and
          bridge  building  and coating. It employed at one time more than 5,000
          scientists and engineers and employs today more than 200 engineers and
          executives. It has joint ventures with several multinational companies
          and  governmental agencies including the U.S. Department of Energy and
          NASA.

     -    Spivdruznist  Business  Association.  This was formed by major defense
          enterprises  to develop and implement methods of dismantling munitions
          and  converting  the  metals and explosive by-products to commercially
          marketable  products.    It  is  composed  of  6  large  manufacturing
          facilities  that  developed  and  manufactured explosives, weapons and
          military  equipment  during  the  Cold  War.

     -    Pivdenexo, Ltd.  This is a research, development and production-design
          "think  tank."

     The  above organizations, working with us as their equal partners in United
Engineering  Company,  as  well  as other organizations in Ukraine look to us to
fill  two  roles:

     -    Inside  Ukraine.  When  they negotiate with western nation enterprises
          expecting to do business in Ukraine, we bring to the negotiating table
          our  experience  in  negotiating  agreements  with  market-oriented
          enterprises.

     -    Outside  Ukraine.  After  we  first identify technologies developed in
          Ukraine  that  appear  to  have  promising  commercial application, we
          introduce  companies  in  the U.S. and in other developed countries to
          these  technologies  and  attempt  to  negotiate  technology  transfer
          agreements  between  them  and  the  Ukraine  organizations.

     There  are no specific funding arrangements required of the stockholders of
United  Engineering  Company.  Projects  are funded on a case-by-case basis.  An
aggregate of $2,078,072 in costs have been contributed to projects by us and the

                                        2
<PAGE>

Ukraine  shareholders of United Engineering.  Of this $2,078,072, we contributed
$601,788  plus  $692,563 in distributions to which we were entitled but chose to
reinvest  rather  than  to  receive.

     We  have recovered $218,176 of our share of the costs of United Engineering
projects.  We  wrote  off  $323,612  of  these costs because we do not expect to
recover  this amount of these costs within one year, even though we do expect to
recover  these  funds  over  the  next  several  years.

     The  reasons we have reinvested $692,563 rather than receive these funds as
distributions  are that our Ukraine co-shareholders also made such reinvestments
and  that  such  reinvestments avoided United Engineering's borrowing funds from
Ukraine  banks at interest rates that ranged between 35 percent to 190 percent a
year.

     Business in Ukraine is built on personal relationships and trust as well as
dealing with people who have the authority to make a project work.  In late 1992
and  early  1993  we  dealt with middle management people who had good ideas but
could  not  make anything happen.  We then developed personal relationships with
partners  such  as  the  President  of  the Academy of Science, Yuzhnoye Machine
Building,  Yuzhnoye  Design Bureau and the 43rd missile army.  We were then able
to  reach  the proper leaders and decision-makers to make our progress easier in
working  through  the  bureaucratic  process.

     Ukraine  requires  a  good  deal of documentation for both the national and
regional  governments.  We  have  found  these  problems  are best solved by our
Ukraine  partners,  who are accustomed to dealing with these issues and know how
to  work  through  the  bureaucratic  process.

     The  economic  laws  in Ukraine change often, and our offices deal with the
changing  laws  on  a weekly basis.  In Ukraine and throughout the former Soviet
Union  there  is  constant  change  in  the  economic conditions as well as high
inflation.  We  have  seen bank loan interest rates fluctuate from a high of 190
percent  per  annum  to  a  low  of  35  percent  per annum.  We and the Ukraine
shareholders  in United Engineering Company reinvest the majority of our profits
to  avoid  paying  these  high  loan  rates.

     The  local currency falling on the international currency markets has had a
strong  negative  impact on our balance sheet.  The exchange rate fell from 1.54
Hryvna  to  the  dollar  in  1997  to  5.5  Hryvna  to  the  dollar  in  1999.

     We  have  experienced  hyperinflation  during  some  years.  This  has been
neutralized  somewhat  as a result of the UEC contracts being negotiated in U.S.
dollars  and  UEC's  having  been  able  to  take advantage of the exchange rate
fluctuations.  Once  the U.S. funds are received by UEC and converted to Hryvna,
the  exchange  rate  works  against us, as the amount of profit and dividends is
adjusted  to  the December 31 currency exchange rate.  The primary step taken to
offset  the  currency  exchange problem and inflation problem is for UEC to hold
the U.S. currency as long as possible before converting to Hryvna.  UEC has also
invested  in  a  number of inflation sensitive assets that it uses in day-to-day
operations,  such  as  ownership  of  its  offices  in Kiev, Dneipropetrovsk and
Pervomyisk.  Other  difficulties such as language barrier and local customs have
been  solved by hiring quality Ukrainian, bi-lingual, English-speaking staff and
training  them  to  meet  our  standard  and  expectations  of  doing  business.

                                        3
<PAGE>

     There  are  no restrictions related to our investment in United Engineering
Company  including  restrictions on its ability to declare and record dividends.

     Inside  Ukraine,  we  have  assisted  United  Engineering  Company  in  its
negotiation  of  contracts  for  the  dismantling  of  the  Ukraine  nuclear and
non-nuclear  missiles,  silos,  and  related  equipment.  This  dismantling  is
required by the treaty known as START and will be paid for by the U.S. and other
western  countries.  The  Ukraine  members  of UEC designed, built and commanded
these  missiles  and silos, are logical organizations to dismantle them, and are
expected  to  receive  a substantial portion of the contracts to dismantle them.

     Since  1995  United  Engineering  Company has completed contracts with U.S.
contractors  for  more  than  $6.0 million with respect to ICBM dismantlement in
Ukraine  and for more than DM4.7 million in contracts with the German Government
and  German  contractors  for  new  methods  of  dismantling  ICBM  silos.

     Outside  Ukraine,  we  have  identified several promising Ukraine-developed
technologies.  We  have  been  both  successful  and unsuccessful in negotiating
technology  transfer agreements between United Engineering Company or one of its
constituent  Ukraine  organizations  and  companies  in  the  U.S.  We  have
successfully  negotiated  technology  transfer  agreements  for the projects set
forth  below.

Business  of  the  Company
--------------------------

     Live  Tissue  Bonding Equipment.  The E.O. Paton Electric Welding Institute
of  Kiev,  Ukraine developed equipment that bonds blood vessels and soft tissues
in substantially less time than other technologies take and apparently leaves no
or  minimal  trace  scar  tissues  after  a  lapse  of  six  to  seven  months.

     The  equipment  bonds  the  soft biological tissue with a special miniature
surgical  tool.  No  glues,  sutures,  staples or other foreign matter are used.
The  process  is best described as a welding process.  The scar tissue is either
minimal  or  non-existent.  Tests  conducted  in  Louisville,  Kentucky  by U.S.
surgeons  on  rabbits'  stomachs resulted in scar tissue only forty microns wide
six months after surgery.  It appears that the Ukraine scientists have developed
a  superior,  all-purpose,  seamless  method of bonding soft biological tissues,
which  method  is  characterized  by simple manipulation applicable to different
surgical operations and the fast restoration of tissues without the formation of
coarse  scars.  Apparently  there  is  no need for prolonged special training of
surgeons  and  surgical  personnel.

     The  Ukraine  prototype  for the equipment was successfully demonstrated to
physicians  and  surgeons  in the U.S. in June 1996 on the blood vessels, nerves
and  stomachs  of  rats  and  rabbits.  Additional, subsequent demonstrations on
animals  were  performed  in  Ukraine  by Ukraine surgeons with U.S. surgeons in
attendance.  In  1998 the U.S. surgeons performed successful tests on animals in
Louisville, Kentucky.  Testing on humans in Ukraine began in mid-year 1998.  One
patient  had  a  blood  vessel  welded,  and the other patient had a torn uterus
repaired  using  minimally  invasive  surgery  tools.  According  to the Ukraine
doctors,  both  patients  recovered in the normal amount of healing time without
side  effects.

                                        4
<PAGE>

     U.S.  and  international  patent  applications on the process were filed in
February 1999, but no patents have been issued.  The exclusive world rights have
been  assigned  to  us, and we will own the patent rights during the duration of
the  patents  should  they  be  issued.

     We  have  submitted  no  applications,  requests  or testing results to the
Federal  Drug Administration.  We have not marketed the bonding equipment in the
Ukraine or any other non-U.S. country and have no plans at this time to do this.
Our  plans  for 2000 are to manufacture prototypes only in Ukraine and to set up
fully controlled clinical trials in Ukraine for comprehensive human testing.  We
expect  to  begin  this  clinical  work in May 2000.  We will need approximately
$260,000  for this work in Ukraine over the next eight months.  We are currently
negotiating  with a group of private investors who are familiar with our company
for  these  funds.

     We estimate that in excess of $1.5 million have been expended in developing
the  project and that $1.5 million of additional funds must be expended to bring
this  product  to market.  We estimate that the first surgical equipment will be
manufactured  in  the  U.S.  in  2001.

     This  project is still in the development stage, even though the Ukrainians
have  created  a  finished  product  in  their  special miniature surgical tool.
Improvements  in  the tool are possible, and testing on live tissue of humans to
U.S.  testing  standards  is required.  Approval of the process and equipment by
the  Federal Drug Administration is required.  The Louisville, Kentucky surgeons
report  that  their recent studies are very favorable, that they need additional
experimentation  for which they will apply for a short study grant from the FDA,
and  that  with  the  grant  they  will  proceed  to  early  human  studies.

     Anaerobic Farm-Waste Disposal Equipment.  We are marketing a closed system,
no  lagoon,  anaerobic  plant  that:

     -    processes  farm-animal  waste  into  a  high grade organic fertilizer,

     -    captures  the  methane  gas  for  commercial  use,

     -    reduces  the  odor,  and

     -    prevents  all  runoff  and  contamination  of  the  environment.

     This  processing  plant  was developed in Ukraine before the breakup of the
Soviet  Union.  The  developer  is  a more-than-100-year-old Ukraine joint stock
company that is the Ukraine's largest enterprise that manufactures equipment for
the  petroleum  and  chemical  industries.  The  company's  name  is Sumy Frunze
Machine-Building Science-and-Production Association, called herein "Frunze."  We
have  obtained  the  exclusive,  worldwide  rights  to market Frunze's anaerobic
farm-waste  disposal  plant.

                                        5
<PAGE>

     Frunze developed the processing plant to solve the above-mentioned problems
that  were  associated  with  a 3,000-head swine farm located in the center of a
city  of  400,000  people.  The  plant  has  operated successfully for more than
twelve  years.

     This  technology was patented in 1991 in U.S.S.R.  Patent applications have
not  been  filed  in the U.S.  Frunze has assigned to us the worldwide rights to
market, distribute, license and service products covered by the U.S.S.R. patents
and any upgrades of the 17-year-duration patents.  This assignment extends until
June  4,  2019  but  will  become  non-exclusive  if,  after  the first plant is
installed  and  fully  operational in the U.S., we fail to place orders annually
for  at  least  $1 million in plant and equipment to be manufactured in Ukraine.
We  are  required  to  pay  royalties  equal to five percent of the costs of all
equipment  manufactured  in  Ukraine.

     Under our license agreement with United Engineering Company and the Ukraine
inventor,  Ivan  Semenenko,  the  Ukrainians  are

     -    to  design  each anaerobic farm-waste disposal facility after visiting
          the  site  where  it  is  to  be  placed,

     -    to  construct  all  of the facility in Ukraine except for the electric
          motors,  generators,  tanks  and  computer  controls,

     -    to  oversee  the  installation  and  startup  of  the facility at each
          project  site,  and

          to  provide  equipment  warranties  acceptable  to  us.

     Our  obligations  are

     -    to  obtain  contracts  for  the  installation  of  the  facilities,

     -    to  pay  the  expenses  of the Ukrainians' visits to the U.S. or other
          countries  in  the performance of their obligations under the license,

     -    to  pay  for and arrange for the delivery to the facility sites of all
          equipment  not  manufactured  in  Ukraine,  and

     -    to  act  as  a  liaison  between  the  Ukrainians  and  persons in the
          countries  where  facilities  are  to  be  installed.

     United  Engineering  Company  coordinates  our  relations  with Frunze, the
manufacturer,  in  Ukraine.  The  plants  will be custom designed for each user.
The  major  portion  of  each plant will be manufactured initially, at least, by
Frunze in Ukraine.  The electric motors, generators, tanks and computer controls
will  be  obtained in the U.S.  Approximately 70% of the cost of a plant will be
for  Ukraine-manufactured parts at a cost far less than could be obtained in the
U.S.

     We  are  attempting  to market this technology ourselves in Oklahoma and in
other  states.  We  are  negotiating  contracts  now.  We expect contracts to be
executed  during  the  fourth  fiscal  quarter  of  2000.

                                        6
<PAGE>

     We  believe  a  considerable  market  exists  for  the  plant, should it be
accepted  by the industry.  At the end of 1997 there were 1,520 U.S. swine farms
with  5,000  head  or  more.

     The  cost of a Farm Waste Anaerobic Plant can be recovered by the farmer or
producer  over  time  from:

     -    organic  fertilizer  sales,

     -    methane  gas  converted  to  electricity  used  on  the  farm and sold
          commercially,

     -    elimination  of  waste  lagoon  expense,  and

     -    reduction  of  other  operating  costs.

     Of  major public relations importance is the near total elimination of foul
odors.  The  only  exposure  of  the  animal  waste  to  the  atmosphere  is the
one-day-or-less  period  that  elapses before it is hosed or scraped to the pump
site  for  transportation  to  the  closed  storage  tanks  or  directly  to the
processing  plant.  Little decomposition and emission of gases occur during this
initial  period.

     Of  major  health  importance  are:

     -    the  elimination  of the volatile organic acids, which are consumed by
          the  gas-producing  bacteria,

     -     the  elimination  of  surface  and  ground  water  contamination, and

     -    the  dramatic  reduction  of  pathogen  populations  in  the  heated
          digesters.

     We have met resistance from swine and dairy farmers, in our efforts to sell
our  Farm  Waste  Anaerobic  Plant,  due to the long period of time required for
small  farms  to  recover the costs of the plant and due to falling milk prices.
We  had two contracts to lease plants to dairy farms near Twin Falls, Idaho, but
both  farms  cancelled  the  contracts  and  forfeited  $10,000  each  for  the
engineering and design services we had performed, all due to fallen milk prices.

     Carbon  Dioxide Separator.  We own the exclusive and perpetual world rights
to  service,  license  and  market  certain unpatented equipment manufactured in
Ukraine that separates carbon dioxide and other impurities from the gas produced
in landfills.  The equipment converts the remaining gas to a cleaner, 98-percent
pure  methane  gas for use in internal combustion engines or for sale to natural
gas  companies.  This  equipment  was  developed for us by the Institute of Gas,
Ukraine  National  Academy  of  Sciences and will be manufactured for us only by
Sumy  Frunze  in  Sumy,  Ukraine.  We  are  now  marketing  this  equipment.

     The manufacturing costs of our CO2 separator plants are substantially lower
than the costs of competitive units.  We have executed a joint venture agreement
with  Resource  Technology  Corporation  of  Chicago,  Illinois, to exploit this
technology.  Our  first  plant  will  be  placed  on a landfill in Mount Vernon,

                                        7
<PAGE>

Alabama.  The plant will be manufactured in Ukraine.  The landfill operator will
provide  all  other  equipment  needed as well as the operations.  Our agreement
with  Resource Technology Corporation requires us to provide the plant and bring
it  to  the  U.S.  We  require approximately $600,000 to fulfill our obligations
under  the agreement.  Resource Technology Corporation will contribute cash, all
necessary government approvals, all piping, tanks and other auxiliary equipment,
the cost of which is estimated to be approximately $1,200,000.  Revenue from the
plant  will  be  shared  65  percent  for Resource Technology Corporation and 35
percent  for  us  until  payout  of  costs, at which time revenue will be shared
equally.  We  are  attempting to sell a 40-percent interest in our share of this
matter  for  the  $600,000  amount  of our obligations.  The consent of Resource
Technology  must  be  obtained  for  such  a  sale,  which  consent  "may not be
unreasonably  withheld."

     Our  equipment  is  now  ready  to be fabricated in Ukraine, and we will be
obligated by November 2000 to make final payment for it and pay the shipping and
installation  costs.  Should we not be able to sell a 40 percent interest in our
interest in the joint venture, we believe we can obtain the funds required of us
from  shareholders  of  our  company  who  have  provided  us funds in the past.
Resource  Technology  is working on obtaining the necessary government approvals
and  expects  to obtain them soon.  We expect to receive our first revenues from
this  project  during  the  first  quarter  of  2001.

     Raw  Materials,  Supplies  and  Manufacturing
     ---------------------------------------------

     No  manufacturer  has  been  selected  for  the  tissue  bonding equipment.

     The  anaerobic  plants  will  be  manufactured in Ukraine by Sumy Frunze in
cooperation  with  United  Engineering  Company  at a cost far less than what it
would  cost  in  the  U.S.

     The  carbon  dioxide separator plants will be manufactured in Kiev, Ukraine
by Sumy Frunze in cooperation with International Welding Association, again at a
cost  far  less  than  what  it  would  cost  in  the  U.S.

     Distribution  Methods
     ---------------------

     We  propose  to negotiate with a medical equipment manufacturing company to
market  and  distribute  the  live  tissue  bonding  equipment once Federal Drug
Administration  approval is obtained.  We have no specific manufacturing company
to  do  this  at  this  time.

     We  have organized a majority-owned subsidiary, Anaerobic Farm Waste, Inc.,
to  own  and lease the anaerobic farm waste disposal equipment.  The officers of
our  company  are  also  the  principal  officers  of  the  subsidiary  company.

     We are marketing our CO2 separator equipment through the joint venture with
Resource  Technology  Corporation.

                                        8
<PAGE>
     Competition
     -----------

          Live  tissue  bonding  equipment.  We  have  the only equipment in the
world that bonds live tissues with little or no scarring.  We are in competition
only  with  older  surgical  methods  of  closing  tissue  openings.

          Anaerobic  farm  waste  disposal plants.  There are ten companies that
offer  various  types  of  anaerobic  systems in the U.S.  None of these systems
processes  the  manure  and  water  to  the  extent  of  the Ukraine-made plant.
Further,  the  costs  of  design,  development, fabrication and construction are
higher  by  multiples in the U.S. than in Ukraine, where high-caliber scientists
and  engineers  are readily available.  The plant now in operation in Ukraine is
the  product  of  years of experience in designing and building various types of
anaerobic  plants.  The  design now in operation has been the most effective and
economical  for  anaerobically  processing  animal  wastes.

          CO2 Separator.  Numerous companies make CO2 separators in the U.S. but
we  believe  none  can  compete  with  the quality of our separators or with our
price.  Their  prices are multiples of ours.  Their separators produce no better
than  75  to  90  percent  pure  methane;  ours produce 98-percent pure methane.

     Patents,  Trademarks  and  Licenses
     -----------------------------------

     The  live  tissue  bonding  equipment  is the subject of patents and patent
applications  filed  by the Ukraine inventor in the Ukraine, the U.S., and other
countries.  The  patents  and the patent applications for the U.S., the European
Patent  Convention,  Australia,  Canada  and  Japan  have  been  assigned to us.

     The  anaerobic  farm-waste  disposal  equipment was patented in U.S.S.R. in
1991 but is not the subject of any patent application filed in the U.S.  The CO2
separator  equipment  is  not the subject of any existing patent; the technology
has  been  known  for  more  than  30  years.

     We  have  been assigned the exclusive world rights to license, manufacture,
market,  and distribute both the anaerobic farm waste disposal equipment and the
CO2  separator  equipment.  We will pay a five percent royalty to the Ukrainians
when  the  equipment  is  installed  and fully operational based on the adjusted
retail  price  of  the  equipment.

     Government  Approval  and  Regulations
     --------------------------------------

     The  live  tissue bonding equipment must obtain the approval of the Federal
Drug  Administration  before it can be sold to be used on humans in the U.S.  We
are  advised  by the Louisville, Kentucky surgeons that their recent studies are
very  favorable,  that  they need additional experimentation for which they will
apply  for  a  short study grant from the FDA, and that with the grant they will
proceed  to  early  human  studies.

     The  anaerobic  farm  waste  disposal  plants  and the CO2 separator plants
require  no  governmental approval before being placed into use, but the results
of  their  usage  are  subject  to  the oversight authority of the Environmental

                                        9
<PAGE>

Protection  Agency.  Because  we  expect  the results of their usage will enable
cattle,  swine  and  chicken  farmers-producers and landfill operators to comply
with EPA regulations, we believe the plants will be readily accepted in the U.S.

     Year  2000  Computer  Problems
     ------------------------------

     We  believe  we do not face material costs, problems or uncertainties about
the  year  2000  computer  problem.  This  problem  affects  many  companies and
organizations  and  stems from the fact that many existing computer programs use
only  two  digits  to  identify a year in the date field and do not consider the
impact  of  the  year  2000.  We  are  newly organized and use off-the-shelf and
easily replaceable software programs for our office work.  We have yet to devise
any software programs for our live tissue bonding, anaerobic farm-waste disposal
or  CO2  separator  projects.

     The animal-waste anaerobic plants will not be installed until 2001, and the
computer  controls for the facilities will not be designed, ordered or installed
until  2001.  The  CO2  separator plants also will not be delivered or installed
before  late  2000.

     The  worst  case  scenario  involving Year 2000 issues would be that United
Engineering  Company  -  the  manufacturer  of the anaerobic farm-waste disposal
facilities,  the  company  to be selected to manufacture the live tissue bonding
tools,  or  Sumy Frunze of Sumy, Ukraine - the manufacturer of the CO2 separator
plants  -  should experience significant Year 2000 problems that would delay the
delivery  of the equipment they are to manufacture.  We have no contingency plan
for  dealing  with  such  a  matter; we will simply have to delay our operations
until  any  such  Year  2000  problems  are  solved at the manufacturers' level.

     We  have  been orally advised by the Ukraine manufacturers of our anaerobic
farm  waste  plants  and  our  CO2  separator  plants  that  they  are Year 2000
compliant.  Should  either  of  them  not  be  Year  2000  compliant  and should
difficulties  arise,  we  will  have to delay our operations until they work out
their  problems.

     Research  and  Development
     --------------------------

     We  expend  no  funds  on  research  and  development.

     Cost  of  Compliance  with  Environmental  Laws
     -----------------------------------------------

     We  have  no  direct  costs  in  complying  with  environmental  laws.  Our
anaerobic  farm waste disposal plants are designed to dispose of farm waste in a
manner  that  meets all environmental regulations.  The same is true with regard
to  our CO2 separator plants.  The users of this equipment have an environmental
waste  disposal  problem  caused  by  their  other  operations.  Their  cost  of
complying  with  environmental  regulations is our share of the revenue produced
from  the  installation  and  use  of  our  equipment.

     Seasonality
     -----------

     There  is  no  seasonal  aspect  of  our  business.

                                       10
<PAGE>
     Employees
     ---------

     We  employ three persons full time in the U.S. and two persons full time in
Kiev,  Ukraine.

ITEM     2.     PROPERTIES

     We  lease  office  space  in  the  following  cities  as  follows:
<TABLE>
<CAPTION>
                             Approximate          Monthly       Term  of
                             Square  Feet         Rental         Lease
                             ------------         -------       --------
<S>                             <C>              <C>         <C>
     Corpus  Christi,  TX       1,000            $   500       08-31-2001
     Oklahoma  City,  OK          500            $   500     Month-to-Month
     Kiev,  Ukraine               800            $ 1,200     Month-to-Month
</TABLE>

ITEM     3.     LEGAL  PROCEEDINGS

     Neither  the  company  nor  our  property  is  a party to any pending legal
proceeding   or   any   known  proceeding  that  a  governmental   authority  is
contemplating.

ITEM     4.     SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

     None

ITEM     5.     MARKET  FOR  COMMON  EQUITY  AND  RELATED  STOCKHOLDER
                MATTERS

     The  company's Common Stock was but is no longer quoted on the OTC Bulletin
Board.  Its  symbol  was  "CTUM" until October 1999 at which time the symbol was
changed  to  "CTUME.OB."  The  symbol  change  reflected  the  fact that the OTC
Bulletin  Board  would remove the company's stock from its system on November 4,
1999  unless,  prior to such date, the company should have entered the financial
statements  reporting  system  of  the  Securities  and Exchange Commission.  On
November  4,  1999  our  stock  was  removed  from  the  Bulletin  Board.

     We filed a registration statement with the Commission that became effective
November  15,  1999.  At  such  time  as the Commission's staff has reviewed the
statement  and  we  have  amended  the  statement to satisfy any comments of the
Commission's  staff,  we  will  become  eligible  again to have our common stock
quoted  on  the  OTC  Bulletin  Board.  Until such date when we have amended our
registration  statement  to  satisfy  any comments of the Commission's staff, we
anticipate  that  our  common  stock  will  be  quoted in the Pink Sheets of the
National  Quotation  Bureau.

     It  first  traded  on  April  21,  1998.  The  range  of  high  and low bid
information  for  our  Common  Stock  is  set  forth  below.  The source of this
information  is  the  OTC  Bulletin  Board.  The quotations reflect inter-dealer
prices  without  retail  markup,  markdown  or commissions and may not represent
actual  transactions.

                                       11
<PAGE>
<TABLE>
<CAPTION>
                                    High              Low
                                    ----              ---
<S>                                 <C>              <C>
     1998
     ----
          2nd  Qtr.                 2                1.125
          3rd  Qtr.                 1.3125           0.5
          4th  Qtr.                 0.2813           0.1500

     1999
          1st  Qtr.                 1.6875           0.1500
          2nd  Qtr.                 1.1875           0.5000
          3rd  Qtr.                 1.1250           0.5
          4th  Qtr.                 *                *
</TABLE>

     *Removed  from  OTC  Bulletin  Board  on  November  4,  1999.

     On  December  31,  1999,  there  were  3,043,050  shares  of  Common  Stock
outstanding.  There  are  850,000  shares  subject  to  outstanding  options  to
purchase,  or  securities  convertible  into,  such  shares  of  stock.

Holders
-------

     As  of  December 31, 1999 there were approximately 126 holders of record of
our  Common  Stock.  Some  523,591  shares  of Common Stock are held by numerous
other  shareholders  in brokerage accounts under the record name of "Cede & Co."

Dividends
---------

     We have paid no dividends to our common stockholders and do not plan to pay
dividends on our Common Stock in the foreseeable future.  We currently intend to
retain  any  earnings  to  finance  future  growth.

Recent  Sales  of  Unregistered  Securities
-------------------------------------------

     During  the  past  three  years  our  company sold the following securities
without  registering  the  securities  under  the  Securities  Act  of  1933:
<TABLE>
<CAPTION>
                               No.  of
                               Common
                               Shares               Offering
           Date                 Sold                 Price
           ----                -------              --------
<S>                           <C>                   <C>
           1997               212,600(1)            $186,950
           1998               174,515(1)(2)           39,451
           4-6-99             602,362(1)             304,155
           12-30-99           169,455(3)             153.243
</TABLE>
________________________

                                       12
<PAGE>

(1)     The  shares  were  sold  pursuant  to  the  exemption  from registration
        provided by Regulation D, Rule 504. The securities were sold through the
        efforts of  our officers and also through the NASD broker-dealer firm of
        Atlantic Pacific  Financial,  Inc.   A  commission of ten percent of the
        proceeds of sales was  paid to  Atlantic  Pacific  Financial,  Inc.  for
        sales  made  by it.  No commissions were paid with respect to sales made
        by the officers of the company.  With  regard  to  the  above  Rule  504
        public offering sales, we furnished each  prospective  investor  with an
        offering memorandum that described  our company and  generally  met  the
        disclosure  requirements  of  Form 1-A  of  the  Securities and Exchange
        Commission.

(2)     Of  these  shares, 12,965 shares were issued in June 1998 to Diversified
        Marketing Co. in exchange for financial public relations services valued
        at $3,000.

(3)     These  shares  were  sold  to accredited investors in an offering exempt
        from registration  pursuant  to Regulation D,  Rule 506.  The securities
        were sold  by  officers  of  the corporation who received no commissions
        with regard to the sales.

ITEM     6.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS

     The  following  discussion  and analysis should be read in conjunction with
the  financial statements and the accompanying notes thereto. It is qualified in
its  entirety  by  the  foregoing  and  by  more  detailed financial information
appearing  elsewhere.  See  "Financial  Statements."

     Sales
     -----

     We  had  revenues of $10,000 in FY 1999 compared with revenues of $9,933 in
FY 1998.  The 1999 revenues were from our tissue bonding activities conducted in
Louisville,  Kentucky with Frantz Medical Research.  The 1998 revenues represent
a refund of a deposit made with a Ukraine joint venture partner with regard to a
soybean  processing  plant  project  that  did  not  materialize.  We did report
$17,343  in FY 1999 and $106,140 in FY 1998 as our fifty percent interest in the
income  of  an  unconsolidated subsidiary, United Engineering Company, a Ukraine
company that represents a joint venture between us and several Ukraine entities.
This income represents our share of the profits from the missile site conversion
activities  of  United  Engineering  Company.  However,  this  accrued,  but not
received,  income  was more than offset by foreign currency losses of $46,847 in
FY  1999  and  $290,309  in  FY 1998 and by our writing off in FY 1998 as a loss
$60,000  owed  us  by  the  Ukraine  entity.

     Our  activities in the U.S. consisted mainly of services we perform for the
Louisville,  Kentucky  surgeons with respect to our live tissue bonding project.
These  services  have  been  funded  by Frantz Medical Research, Inc., represent
research  and  development expenses of the funded project, and our receipts from
this  project  are  not  taken  into  income.

     Selling,  General  and  Administrative  Expenses
     ------------------------------------------------

     Our  selling,  general and administrative expenses were $372,469 in FY 1999
compared with $541,699 during FY 1998.  The major items of these expenses were -

                                       13
<PAGE>
<TABLE>
<CAPTION>
     Item                                1999              1998
     ----                                ----              ----
<S>                                    <C>               <C>
     Interest  expense                 $ 73,130          $134,000
     Loan  expenses                                       191,983
     Consulting  services                 4,500            67,000
     Office  overhead  and  salaries    117,856            48,000
     Travel                              41,766            10,000,  and
     Accounting                          10,692            24,600
</TABLE>

     The  activities  which  these  expenses  were  intended to benefit were our
anaerobic farm-waste disposal equipment project and our carbon dioxide separator
project.  These  projects  -  both  of  which  are  based  upon  excellent
Ukraine-developed  equipment that can be manufactured in Ukraine, brought to the
U.S.  and  installed at considerable savings to the employment of U.S. equipment
of comparable or inferior quality - represent a substantial part of our business
plan  for  the  future.

     Net  Loss
     ---------

     In  fiscal  year  1999  we  had  a  net loss of $443,799, or $0.16 a share,
compared  with  a net loss of $784,279 in FY 1998 or $0.37 a share.  There was a
significant  shift  in  operations in 1999 - away from the funded tissue bonding
project  in  1998  to  the  anaerobic  farm  waste  and  CO2 separator projects.

     Liquidity  and  Outlook
     -----------------------

     We  have  never  operated  at  a profit.  We were able to stay in operation
during  1999  only  from  the  proceeds  of  $149,989 in new loans made to us by
shareholders,  from  the sale of $304,155 of capital stock for payment on notes,
and from the sale of capital stock for $72,507 in cash, $17,032 for services and
$63,711  for  interest  payments.  We were able to stay in operation during 1998
only  from  the  proceeds  realized  from  loans  of  $288,750 made to us by our
shareholders  and  from  the  sale  of  $30,000  of  capital  stock.

     Management  believes  our prospects for financial liquidity depend upon the
following:

     -    obtaining  contracts  for  the  leasing  of  our  anaerobic farm waste
          equipment;

     -    obtaining  contracts  for  the  joint  venturing of our CO2 separator;

     -    the  sale  of  capital  stock in either our company or our subsidiary,
          Anaerobic  Farm  Waste,  Inc.;  and

     -    loans  to  finance  the purchase of anaerobic farm waste units and CO2
          separators.

At  this time, we have not identified the sources for additional equity capital.

     Our  anaerobic  farm  waste disposal equipment project is on track with the
Ukrainian  design experts having visited the farm in Idaho and having designed a

                                       14
<PAGE>

plant  to  fit  the  needs of the farmer.  We are in final negotiations with the
farmer  for  plant  purchase.  Assuming  the  sale goes through, we estimate the
installation  will  occur during the fourth quarter of 2000 and we will commence
to  receive  revenue  from  the  plant  during  the  first  quarter  of  2001.

     We  have  completed  a  letter  of  intent  to  install  one carbon dioxide
separator plant in Alabama.  We should negotiate and execute the contract during
the  first  quarter  of  2000.  If  so, we expect to manufacture and install the
plant  by the third quarter of 2000 with revenue commencing during that quarter.

ITEM     7.     FINANCIAL  STATEMENTS

     Independent  Auditors  Report                                          16
     Balance  Sheet  December  31,  1999                                    17
     Statement  of  Operations  Year  Ended  December  31,
          1999  and  1998                                                   19
     Statement  of  Cash  Flows  Year  Ended  December  31,
          1999  and  1998                                                   20


















                                       15
<PAGE>





                          INDEPENDENT AUDITORS REPORT
                          ---------------------------



To  the  Shareholders  and  Board  of  Directors
Consortium  Service  Management  Group,  Inc.


I  have  audited the accompanying balance sheet of Consortium Service Management
Group,  Inc.  as of December 31, 1999, and the related statements of operations,
changes  in  stockholders' equity and cash flows for the year then ended.  These
financial  statements  are  the  responsibility of the company's management.  My
responsibility  is  to express an opinion on these financial statements based on
my  audit.

I  conducted  my audit in accordance with generally accepted auditing standards.
Those  standards  require that I plan and perform the audit to obtain reasonable
assurance  about  whether   the  financial  statements   are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing  the  accounting  principles  used  and  significant estimates made by
management,  as well as evaluating the overall financial statement presentation.
I  believe  that  my  audit  provides  a  reasonable  basis  for  my  opinion.

In my opinion, the financial statements referred to above present fairly, in all
material  respects,  the  financial  position  of  Consortium Service Management
Group,  Inc. as of December 31, 1999, and the results of its operations and cash
flows  for the year then ended, in conformity with generally accepted accounting
principles.

The  accompanying  financial  statements  have  been  prepared assuming that the
Company  will  continue  as  a  going  concern.  As  discussed  in Note 2 to the
financial  statements, the Company has suffered recurring losses from operations
that  raises substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 2.  The
financial  statements  do not include any adjustments that might result from the
outcome  of  this  uncertainty.




                                        /s/Gary  Skibicki

Oklahoma  City,  Oklahoma               Gary  Skibicki
October  9,  2000                       Certified  Public  Accountant



                                       16
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                                  BALANCE SHEET
                                December 31, 1999



                                     ASSETS
                                     ------
<TABLE>
<CAPTION>
CURRENT  ASSETS
---------------
<S>                                                   <C>            <C>
Cash                                                  $        0
Notes Receivable                                             600
                                                      ----------
    Total Current Assets                                             $      600
                                                                     ----------

FIXED  ASSETS
-------------

Furniture, Fixtures & Equipment                          58,518
  Less:  Accumulated Depreciation                       (28,041)
                                                      ---------
    Total Fixed Assets                                                   30,477
                                                                     ----------

OTHER  ASSETS
-------------

Investment - United Engineering Company                 161,030
Founders Fund                                            73,843
Investment - Anaerobic Farm Waste                           946
Employee Advances                                         1,633
                                                      ---------

   Total Other Assets                                                   237,452
                                                                     ----------

   Total Assets                                                      $  268,529
                                                                     ==========
</TABLE>



    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS

                                       17
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                            BALANCE SHEET (Continued)
                                December 31, 1999


                                  LIABILITIES
                                  -----------
<TABLE>
<CAPTION>
CURRENT  LIABILITIES
--------------------
<S>                                                   <C>            <C>
Bank Overdraft                                        $        6
Accounts Payable                                          57,800
Federal Payroll Taxes Payable                             20,627
Accrued Interest                                          18,063
Short Term Note Payable                                   31,000
Notes Payable to Stockholders                            485,264

    Total Current Liabilities                                        $  612,760
                                                                     ----------

STOCKHOLDERS  EQUITY
--------------------

Preferred  Stock,  $.001  Par Value, 10,000,000
Shares Authorized; 75,669 Shares Issued and
Outstanding at December 31, 1999                              76



Common  Stock  $.001  Par  Value, 40,000,000
Shares Authorized; 3,043,050 Shares Issued and
Outstanding at December 31, 1999                           3,043

Additional Paid In Capital                             1,910,187

Deficit  1/1/99                $(1,813,738)
Current  Year  (Loss)             (396,952)
Foreign  Exchange  Loss            (46,847)
Deficit 12/31/99                                      (2,257,537)
                                                      ----------

    Total Stockholders Equity                                          (344,231)
                                                                     ----------

    Total Liabilities and Stockholders Equity                        $  268,523
                                                                     ==========
</TABLE>

    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS

                                       18
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                            STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
                                                     Year Ended December 31,
                                                              1999                   1998
                                                              ----                  -----
<S>                                            <C>         <C>          <C>      <C>
Revenues                                                   $   10,000            $    9,933
Cost of Goods Sold                                                  0                     0
Gross Profit                                                   10,000                 9,933
General and Administrative Expenses                           372,469               541,699
Funded Research and Development                    21,217               268,996
Cost of Funded Research and Development            73,063               239,334
Net Research and Development Cost                             (51,846)              (20,338)
Operating Loss                                               (414,315)             (552,104)
Interest Income                                                    20                     0
Interest in Income of Unconsolidated Companies                 17,343               106,140
Gain on Asset Exchange                                              0                11,994
Bad Debt Expense                                                    0               (60,000)
Foreign Currency Loss                                         (46,847)             (290,309)
(Loss) from Continuing Operations                            (443,799)             (784,279)
Income Taxes                                                        0                     0
Net Loss                                                     (443,799)             (784,279)
Net Loss Per Share of Common Stock                             $(0.16)               $(0.37)
Weighted Average Common
  Shares Outstanding                                 2,690,057 Shares       2,111,261 Shares
</TABLE>


Basic and diluted earnings per share are the same.  The corporation is reporting
a  net loss for the reporting period and any potentially dilutive securities are
antidilutive  (reduce  loss  per  share)  and  therefore  not  presented.









    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS

                                       19
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                             STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                           Year Ended December 31,
                                                     1999                1998
                                           -----------------------   -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
------------------------------------
<S>                                              <C>                <C>
Net Loss                                         $  (443,799)       $  (784,279)
Dividends from Investee                                8,390              2,666
Depreciation                                           7,710              7,710
Write Off Note Receivable                             17,800                  0
Increase Accounts Payable and Accrued Expenses        44,611                  0
Decrease Accounts Payable and Accrued Expenses             0            (10,292)
Bank Overdraft                                             6                  0
Equity Income from Investees                         (17,343)          (106,140)
Foreign Exchange Loss                                 46,847            290,309
Interest                                                   0             95,225
Compensation for Common Stock                         17,032            191,983
Interest Expense for Common Stock                     63,711                  0
Bad Debt Expense                                           0             60,000
                                                 -----------        -----------
Net Cash Used in Operating Activities               (255,035)          (252,818)

CASH  FLOWS  FROM  INVESTING  ACTIVITIES:
----------------------------------------
Invest in Subsidiary - Anaerobic Farm Waste, Inc.     (1,000)                 0
Purchase Equipment                                         0            (24,650)
Increase Employee Advance                             (1,633)                 0
Increase Note Receivable                                   0               (600)
                                                 -----------        -----------
Cash Used from Investing Activities                   (2,633)           (25,250)

CASH  FLOWS  FROM  FINANCING  ACTIVITIES:
----------------------------------------
Increase Stock Issue                                  57,500             30,000
Increase Notes Payable                               149,989                  0
Increase Shareholder Loans                                 0            228,750
                                                 -----------        -----------
Increase Cash from Financing Activities              207,489            318,750
Net Decrease in Cash                                 (50,179)                 0
Net Increase in Cash                                       0             40,682
Cash at Beginning of Period                           50,179              9,497
Cash at End of Period                                      0             50,179

Non  Cash  Financing  Activities
Shareholder Note Payable Converted
  to Capital Stock                                   304,155                  0
Shareholder Note Payable Added to Paid-in Capital          0              9,450
</TABLE>


    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS

                                       20
<PAGE>

                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                  STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
            FROM INCEPTION (NOVEMBER 19, 1992) TO DECEMBER 31, 1999
<TABLE>
<CAPTION>
                               NO. PREFERRED    PAR     NO. COMMON    PAR     ADDITIONAL    ACCUMULATED
DESCRIPTION                       SHARES       VALUE    SHARES(ea)   VALUE  PAID IN CAPITAL   DEFICIT      TOTAL
------------------------------------------------------------------------------------------------------------------
<S>                                  <C>        <C>     <C>         <C>       <C>             <C>        <C>
Common Shares Issued for
Services  at  Inception                                 1,260,000   $1,260    $   49,140                 $  50,400
Nov.  19,  1992
Net Loss Year Ended 12/31/92                                                                   (23,882)    (23,882)
                                  ---------    -----    ---------   ------    ----------      --------   ---------
Balance December 31, 1992                               1,260,000   $1,260    $   49,140       (23,882)  $  26,518

Common Shares Issued for
Cash  During  1993                                        102,063      102       134,898                   135,000
Net  Loss  Year  Ended  12/31/93                                                              (119,408)   (119,408)
                                  ---------   ------    ---------   ------    ----------      --------   ---------
Balance December 31, 1993                               1,362,063    1,362       184,038      (143,290)     42,110
Common Shares Issued for
Cash  During  1994                                        320,848       32       543,182                   543,502
Common  Shares  Issued  for
Services During 1994                                      139,750      140        65,450                    65,590
Net  Loss  Year  Ended  12/31/94                                                              (348,402)   (348,402)
                                  ---------   -------   ---------   ------    ----------      --------   ---------

Balance December 31, 1994                               1,822,661    1,822       792,670      (491,692)    302,800

Common  Shares  Issued  for
Cash  During  1995                                         61,457       62        99,938                   100,000
Paid  In  Capital  for
Services  during  1995                                                            60,000                    60,000
Net  Loss  Year  Ended  12/31/95                                                              (315,280)   (315,280)
                                  ---------   -------   ---------   ------   -----------     ---------   ---------
Balance December 31, 1995                               1,884,118    1,884       952,608      (806,972)    147,520

Paid  In  Capital  for
Services  during  1996                                                            60,000                    60,000
Preferred  Shares  Issued  for
Services  on  April  11,  1996       73,958     $74                               14,958                    15,032
Preferred  Shares  Issued
For  Asset  on  April  11,  1996      1,711       2                                7,998                     8,000
Net  Loss  Year  Ended  12/31/96                                                              (190,813)   (190,813)
                                    -------     ---     ---------   ------   -----------     ---------   ---------
Balance  December  31,  1996         75,669      76     1,884,118    1,884     1,035,564      (997,785)     39,739
</TABLE>


                                       21
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                  STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
            FROM INCEPTION (NOVEMBER 19, 1992) TO DECEMBER 31, 1999
                                  (Continued)

<TABLE>
<CAPTION>
                               NO. PREFERRED    PAR     NO. COMMON    PAR     ADDITIONAL    ACCUMULATED
DESCRIPTION                       SHARES       VALUE    SHARES(ea)   VALUE  PAID IN CAPITAL   DEFICIT      TOTAL
------------------------------------------------------------------------------------------------------------------
<S>                                  <C>        <C>     <C>         <C>       <C>            <C>         <C>
Common Shares Issued for
Cash  During  1997                                        205,250      205       180,295                    180,500
Common  Shares  Issued  for
Services  During  1997                                      7,350        8         6,442                      6,450
Net  Loss  Year  Ended  12/31/97                                                                 (31,673)   (31,673)
                                     ------     ---     ---------   ------    ----------     -----------  ---------
Balance  December  31,  1997         75,669     $76     2,096,718   $2,097    $1,222,301     $(1,029,458) $ 195,016

Additional  Paid  In  Capital                                                     39,451                     39,451
Common  Shares  Issued  for
Services During 1998                                      174,515     174       $191,809                    191,983
Net  Loss  Year  Ended
12/31/98                                                                                     $  (784,279)  (784,279)
                                     ------     ---     ---------   -----     ----------     -----------  ---------
Balance  December  31,  1998         75,669     $76     2,271,233  $2,271     $1,453,561     $(1,813,738) $(357,830)

Common  Shares  Exchanged
for  Notes  During  1999                                  602,362     602        303,553                    304,155
Common Shares Sold During 1999                             72,500      73         72,427                     72,500
Common  Shares  Issued
for  Services During 1999                                  18,491      18         17,014                     17,032
Common  Shares  Issued
for  Interest During 1999                                  78,464      79         63,632                     63,711
Net  Loss  Year  Ended  12/31/99                                                             $  (443,799)  (433,799)
                                     ------     ---     ---------  ------     ----------     -----------  ---------

Balance  December  31,  1999         75,669     $76     3,043,050  $3,043     $1,910,187     $(2,257,537) $(344,231)
</TABLE>


                                       22
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 1999


                                     NOTE 1
                        SIGNIFICANT ACCOUNTING POLICIES

Nature  of  Operations

Consortium  Service Management Group, Inc. (the "Company"), a Texas corporation,
was  incorporated  on  November 17, 1992.  The planned operations of the Company
are  to  develop  business  and investment opportunities worldwide by licensing,
marketing  and  distributing rights in advanced technologies developed primarily
in  the  Ukraine.

The  Company has an agreement with the E. O. Paton Institute of Electric Welding
of  the  Ukraine  National  Academy  of  Sciences  and International Association
Welding  for  the  exclusive  world  rights  agreement for licensing, patenting,
manufacture,  development,  distribution  and  service  for  the Live Biological
tissue  bonding  technology.  The Live Biological Tissue bonding process is a US
and  International  Patent  pending  technology  and  was  developed through the
International Association Welding.  The technology has been clinically tested on
animals  in Ukraine as well as some human clinical work on removed human organs.
First  stage animal clinical tests have also been done in Louisville, KY., which
if  proven  successful  will  significantly reduce operating and healing time on
humans.  Several  U.S.  medical  doctors  who  specialize  in  this  field  are
encouraged with initial results necessitating the company to continue testing in
both  the  U.S. and Ukraine until FDA approval is received.  Previous agreements
with  Paton  and  International  Association  of Welding involving other medical
technologies  expired  in  1999  because  the Company is concentrating on tissue
bonding.

The  live  tissue  bonding  agreement as described in Note 1 on the December 31,
1998  audited  financial  statements  expired in January of 1999.  Specifically,
this agreement provided funding to test, patent, market, manufacture, distribute
and  license  tissue  bonding  technology where the L Group paid CSMG $5,000 per
month  to  support  an  office in the Ukraine and pay travel costs.  The L Group
also paid CSMG $16,217 of which $15,187 was paid to International Association of
Welding  to  fund  research  and  development  associated  with  tissue  bonding
technology.  In January of 1999 the agreement was cancelled with a final payment
also  received  in  January  1999  for  $21,217.

In  1999  Consortium  Service Management Group, Inc. signed two contracts on the
Anaerobic Animal waste project with two Idaho dairies.  Both dairies declined to
install the plants due to falling raw milk prices from $16.00 per hundred weight
to  $9.80  per  hundred  weight.  Both  dairies paid a fee of $10,000 each for a
total  of $20,000 to Consortium Service Management Group, Inc. for services, one
in  December  1999  and  the  other  in  March  2000.

The Company does not internally separate financial information including results
of operations by segments such as geographic areas, products, major customers or

                                       23
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 1999


operating  segments.  With  the  major  component  of  income  being from United
Engineering  Company's  earnings  management considers it impractical to further
segment  financial  information.

Cash  and  Cash  Equivalents

For  purposes  of the statements of cash flows, the Company considers all highly
liquid  investments  with  maturities  of  less  than  three  months  to be cash
equivalents.

Revenue  Recognition

Income is recognized as earned by the foreign investee and Anaerobic Farm Waste,
Inc.,  using  the  equity  method  of  accounting.  At the beginning of 1999 the
Company  had  a  receivable  of $17,800 which was charged against revenue in the
current  year.  Other  than  these  exceptions  the general policy is revenue is
recognized  when  received.

Furniture,  Fixtures  and  Equipment

Furniture,  fixtures  and equipment are stated at cost and are depreciated using
the  straight  -  line  method  over  the  estimated useful lives of the assets,
primarily  five  years.  Equipment  with  no  continuing  value  is written off.

Investments  in  Unconsolidated  Companies

Investments  in companies in which Consortium Service Management Group, Inc. has
an  equity  interest  of at least 20% are accounted for under the equity method.
Under this method, the Company records its share of income or losses as interest
in  income or losses of unconsolidated companies with corresponding increases or
decreases  in  the  investment  account.  In  1999  the Company had a 50% equity
interest  in  United Engineering Company and a 100% equity interest in Anaerobic
Farm  Waste, Inc.  The 1999 equity method income from United Engineering Company
is  $17,397  and  ($54)  from  Anaerobic  Farm  Waste,  Inc.

Foreign  Operations

Foreign  currency transactions and financial statements are translated into U.S.
dollars  in  accordance  with Statement of Financial Accounting Standards No. 52
"Foreign Currency Translation".  All balance sheet accounts have been translated
using  the  current  exchange  rate at the balance sheet date.  Income Statement
accounts  have been translated using the average exchange rates during the year.
The  Company  owns  a  50%  interest  in  United  Engineering  Company which was
organized  in  and  operates  in the Ukraine.  The average exchange rate used to
record  income  was  .23196 functional currency to U.S. dollars and the year end
exchange  rate used to value the United Engineering investment account was .1916
functional  currency  to  U.S.  dollars.

                                       24
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 1999


Loss  Per  Share

The  computation  of  loss  per  share  of common stock is based on the weighted
average  number  of shares outstanding during the period presented.  The Company
had  a  net  loss in 1999 of $443,799 and accordingly basic and diluted earnings
per  share  are the same because any dilutive or potentially dilutive securities
would  be  antidilutive.

Issuance  of  Shares  for  Services

Valuation  of shares for services is based on the fair market value of services.
During  1999  the  Company  issued  18491 shares of common stock in exchange for
management,  marketing and research services.  The cost of the services has been
charged  to  operations  and  additional  paid  in capital has been increased by
$17014,  representing  the excess of the cost of the services over the par value
of  the  common  stock issued.  Additionally, the Company issued 78464 shares of
common stock for interest on notes payable to shareholders with the cost charged
to operations and additional paid in capital increased by excess of the interest
expense  over  the  par  value  of  the  common  stock  issued,  $63,632.

Preferred  Stock

On  December  28,  1995  the  Company authorized the issuance of 75669 shares of
Series  A  preferred  stock, 10.00 face amount, .001 Par which pays a cumulative
dividend  of  net  corporate  profit  equal  to  8%  of  the  face amount of the
outstanding  stock.  If the Company does not realize any profits preferred stock
dividends  are  not  accruable.  Such preferred Series A stock is preferred over
all  common  stock  in the event of corporate liquidation and dissolution to the
extent  of  its  unredeemed  face  amount.

Use  of  Estimates

The  preparation  of  financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect  the amounts reported in the financial statements and accompanying notes.
Actual  results  could  differ  from  those  estimates.

Accounting  Pronouncements  Adopted  in  1999

During  1998,  the  Financial  Accounting  Standards  Board issued the following
Statements  of  Financial  Accounting  Standards  ("SFAS") effective for periods
beginning  after  December  15,  1997  and  adopted  by the Company during 1998.
Adoption  of  these  Standards  did  not have a material effect on its financial
position,  results  of  operations  or  on  disclosures  within  the  financial
statements.

(1)     SFAS  No.  132  -  "Employer's Disclosures about Pensions and Other Post
Retirement  Benefits"  addressed  disclosure  issues only and not measurement or
recognition  issues.

                                       25
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 1999


(2)     SFAS  No.  133  -  "Accounting  for  Derivative  Instruments and Hedging
Activities",  established  standards  for  accounting for derivative instruments
including certain derivative instruments embedded in other contracts and hedging
activities.   15,  1999.

(3)  SFAS  No.  134  - "Accounting for Mortgage-Backed Securities Retained after
the  Securitization  of  Mortgage  Loans  Held  for  Sales by a Mortgage Banking
Enterprise."


Income  Taxes

The  Company  records  its  income tax provision in accordance with Statement of
Financial  Accounting  Standards  No.  109, "Accounting for Income Taxes".  (See
Note  3).


                                     NOTE 2
                BASIS OF PRESENTATION AND CONSIDERATIONS RELATED
                     TO CONTINUED EXISTENCE (GOING CONCERN)

The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and the satisfaction
of  liabilities  in  the  normal course of business.  The Company incurred a net
loss  of  $443,799 for the year ended December 31, 1999 and this factor combined
with prior year net losses, raises substantial doubt as to the Company's ability
to  obtain  debt  and/or  equity  financing  and  achieve profitable operations.

The  Company's  management  intends  to raise additional operating funds through
equity  and/or  debt offerings and the sale of technologies.  However, there can
be  no  assurance  management  will be successful in its endeavors. The possible
consequences  of not obtaining additional funds either through equity offerings,
debt  offerings  or  sale  of  technologies is that there will not be sufficient
money to fund the capital projects required to earn long term revenues.  A major
component of planned future operations involves the construction of animal waste
and  disposal facilities for either sale and or lease and these undertakings are
only  possible  from  outside  financing.  The  possible  consequences  of  not
obtaining  additional  financing  are  current  and  planned  operations ceasing
resulting  in  a  liquidation  of  the  Company.


                                     NOTE 3
                                  INCOME TAXES

The  Company  records  its  income tax provision in accordance with Statement of
Financial  Accounting  Standards  No.  109,  "Accounting for Income Taxes" which
requires  the  use  of  the  liability  method of accounting for deferred income
taxes.

                                       26
<PAGE>
                    CONSORTIUM SERVICE MANAGEMENT GROUP, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 1999


Since the Company has not generated taxable income since inception, no provision
for income taxes has been provided.  At December 31, 1998 the net operating loss
carryforward  was  $1,265,642.


                                     NOTE 4
                    INVESTMENT - UNITED ENGINEERING COMPANY

At  December  31, 1998 the Company was a 50% owner of United Engineering Company
("UEC"),  a  Ukraine  -  U.S.  joint  stock company registered under the laws of
Ukraine.  The other 50% of UEC's equity was owned by eight Ukraine organizations
representing  fourteen Ukraine organizations, three of which represent the State
Property  Fund  of  Ukraine.  All  UEC decisions require a 75% shareholder vote.
UEC  is a Ukraine joint stock company with foreign investment, the Company being
the  foreign  investor,  and  holds  a Ukraine license to perform classified and
secret  construction works relating to projects that are in the Ukraine national
security  sector.  For  the  year  ended  December  31, 1999 UEC had revenues of
$1,129,019  and a net income of $150,000.  At December 31, 1999 UEC had $567,347
in  assets and $97,601 in liabilities.  For the year ended December 31, 1999 the
Company  had  an  interest  of  $17,397  in  the  income  of  UEC.

A  portion of Investment - United Engineering Company is shown as Founders Fund.
This  represents  a liquidation priority.  In 1994 the company made its original
investment  in United Engineering Company which included contributing $73,843 in
autos,  equipment  and furniture.  The agreement between the company and UEC was
that  in  the  event of UEC liquidating $73,843 would be repaid in preference to
all  creditors.  As  an  incentive  to  encourage foreign investment the Ukraine
government  has  guaranteed  repayment  if upon liquidation UEC has insufficient
funds  to  do  so.


                                     NOTE 5
                          NOTES PAYABLE TO STOCKHOLDERS

Notes  to  shareholders  consist  of 18 short-term (generally one year) interest
bearing  unsecured  notes  with  varying  maturity  dates  with  the most common
interest  rate  being  11% per annum on the unpaid balance.  In 1999 $304,155 of
shareholder  notes  payable were retired by being exchanged for common stock and
during  the  first  four months of 2000 the Company paid off $69,500 of existing
notes.  In  February  of 2000 the Company borrowed $131,500 issuing 3 short term
11%  notes  with maturity dates of June 1, 2000 $21,500, June 18, 2000 $100,000,
and  July 18, 2000 $10,000.  In April of 2000 the Company borrowed an additional
$137,500  issuing  three  short term 11% notes with maturity dates of August 19,
2000  $100,000,  October  5,  2000  $17,500  and  October  6,  2000  $20,000.

                                       27
<PAGE>
ITEM     9.     DIRECTORS,   EXECUTIVE   OFFICERS,   PROMOTERS   AND   CONTROL
                PERSONS;  COMPLIANCE WITH  SECTION 16(a)  OF THE EXCHANGE  ACT

     Set forth below are the names and terms of office of each of the directors,
executive officers and significant employees of the company and a description of
the  business  experience  of  each.

<TABLE>
<CAPTION>
                                                                   Director's
                                                       Director      Term
      Person                 Positions and Offices      Since       Expires
      ------                 ---------------------     --------    ----------
<S>                         <C>                          <C>          <C>
Esmeralda G. Robbins, 55    Chairman  of the Board       1992         2001
                            of  Directors

Donald S. Robbins, 56       President,  Chief            1992         2001
                            Executive  Officer  and
                            Director

Gordon W. Allison, 73       Executive  Vice  Presi-      1992         2001
                            dent,  Chief  Financial
                            Officer,  Secretary  and
                            Director

James Workman, 72           Director                     1998         2001
</TABLE>

     Esmeralda  G.  Robbins.  From  1979  to 1993 Mrs. Robbins worked as Product
Consultant  and  Salon  Coordinator  for  Corpus Christi Beauty Supply, a family
owned  business  that  covered   a  500-mile  radius.   Mrs.  Robbins  consulted
boutiques,  beauty,  and  barber  salons  providing  the  equipment and products
necessary  for  them to start a new salon.  Working with furniture manufacturers
and  product  technicians she also coordinated large-scale seminars to introduce
shop  owners and their employees to new products and ideas to improve and update
their  services.  Mrs.  Robbins  would also oversee the day-to-day operations of
the  business  along with other family members.  In 1993 the business was closed
due  to  the  declining  health  of  elder  family  members.  Mrs. Robbins is an
original  founder  of  Consortium  Service  Management  Group  and  has been its
Chairman  of  the  Board  since  1992.  She has worked full time for the company
since  1993.  She  is the spouse of Donald S. Robbins, president of the company.

     Donald  S.  Robbins.  Mr.  Robbins commenced his business career by working
from 1969 until 1979 with several life insurance companies in the area of estate
and  retirement  planning.  From  1979  until  1983  he  was associated with the
financial  planning  division  of  E.F. Hutton, Hutton Financial Services.  From
1983  until  1988  he  was associated with Prudential Bache Securities as a vice
president  for  investments and financial planning.  From 1988 until 1995 he was
affiliated  with  the  broker-dealer  firm Royal Alliance Associates, Inc.  From
1983  until  1985  he  has  been  a guest speaker at numerous investor meetings,
continuing  medical  education  meetings,  medical  society  meetings and broker
seminars.  Mr.  Robbins was one of the founders of Consortium Service Management
Group  in 1992 and has been employed full time by the company since 1992.  He is
the  person who has negotiated for the company with respect to the marketing and
licensing  agreements  of  the  company  and  the person who negotiated with the

                                       28
<PAGE>

various organizations in Ukraine that, together with the company, founded United
Engineering  Joint Stock Company.  Mr. Robbins oversees the company's operations
offices  in  Ukraine  and devotes full time to the affairs of the company. He is
the  spouse  of  Esmeralda  G.  Robbins, the chairman of the board of directors.

     Gordon  W.  Allison.  Mr.  Allison has 35 years experience in the insurance
industry and 28 years experience as a corporate officer and a chief executive of
several companies.  From 1972 through 1987 he was the chief executive officer of
American  Trustee  Life  Corporation  and  affiliated  insurance  companies  in
Minnesota, Arizona, and Nebraska.  From 1982 through 1991 he was the partnership
manager  of  Cross  Timbers  Ranch  Ltd., a real estate development and ranching
operation  specializing in tax-sheltered cattle maintenance.  In 1988 he retired
from the insurance industry as an officer and director of companies but remained
in  sales  and financial planning.  From 1988 until 1991 he served as a director
of  Advantage  Marketing  System,  a public company.  In 1982 he was the elected
president  of the Association of Oklahoma Life Insurance Companies.  He has been
a bank director and a community and church leader in Oklahoma City for more than
30  years.  He  is one of the founders of Consortium Service Management Group in
1992  and  has  been  employed  full  time  by  the  company  since 1992.  He is
responsible for its operations in the U.S., particularly during periods when Mr.
Robbins  is  in  Ukraine.

     James  Workman.  An  agriculture entrepreneur and expert, James Workman has
spent  his  entire  working  life  in agriculture projects.  For 35 years he has
operated  and  owned  several thousand acres of farming.  He retired in 1993 and
sold his 26,000-acre farming operation in Mississippi specializing in soy beans,
rice, cotton, corn and wheat.  Prior to moving to Mississippi, James Workman had
operated  a  10,000-acre farm operation in Arkansas for a German company farming
rice,  cotton,  corn  and  soy  beans.  He  specialized  in  land clearing, land
precision leveling, drainage and irrigation for the German company.  Mr. Workman
has  worked  part  time  with  Consortium Service Management Group since January
1993.

     Compliance  with  Section  16(a)  of  the  Securities  Exchange  Act.
     ---------------------------------------------------------------------

     Based  solely upon a review of Forms 3 and 4 furnished to the company under
Rule  16a-3(e) of the Securities Exchange Act during its most recent fiscal year
and Forms 5 furnished to the company with respect to its most recent fiscal year
and any written representations received by the company from persons required to
file  such  forms,  the  following  persons  -  either  officers,  directors  or
beneficial owners of more than ten percent of any class of equity of the company
registered  pursuant  to  Section  12 of the Securities Exchange Act - failed to
file  on  a  timely  basis  reports  required by Section 16(a) of the Securities
Exchange  Act  during  the  most  recent  fiscal  year  or  prior  fiscal years:
<TABLE>
<CAPTION>
                                                                No. of Failures
                                           No. of Transactions      to File a
                      No. of Late Reports  Not Timely Reported  Required Report
                      -------------------  -------------------  ---------------
<S>                          <C>                   <C>                 <C>
Esmeralda G. Robbins         None                  None                None
Donald S. Robbins            None                  None                None
Gordon W. Allison            None                  None                None
James Workman                None                  None                None
</TABLE>


                                       29
<PAGE>
ITEM     10.     EXECUTIVE  COMPENSATION

     Set  forth  below  is  the aggregate compensation during fiscal years 1997,
1998 and 1999 of the chief executive officer of the company.  During the period,
no  executive  officer  of  the  company  received  compensation  that  exceeded
$100,000.
<TABLE>
<CAPTION>
          Name                  Fiscal Year   Annual Salary   Other Compensation
          ----                  -----------   -------------   ------------------
<S>                                <C>            <C>                <C>
Donald S. Robbins, President       1999           $43,457            None
Donald S. Robbins, President       1998           $48,000            None
Donald S. Robbins, President       1997           $32,900            None
</TABLE>

     Set  forth  below  is information concerning each exercise of stock options
during  the  last  fiscal  year  by each of the named executive officers and the
fiscal  year-end values of unexercised options, provided on an aggregated basis:
<TABLE>
<CAPTION>
                                          No. of Shares
                                            Underlying      Value of Unexercised
                                        Unexercised Options      In-the-Money
                     Shares                 at  FY-End        Options at FY-End
                    Acquired     Value      Exercisable/         Exercisable/
     Name         or Exercised  Realized    Unexercisable        Unexercisable
     ----         ------------  -------- ------------------ --------------------
<S>                     <C>         <C>       <C>                     <C>
Donald S. Robbins       0           0         425,000/0               None
Gordon W. Allison       0           0         425,000/0               None
</TABLE>

     Directors  of  the  company  receive  no compensation for their services as
directors.

ITEM     11.     SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND
                 MANAGEMENT

     The  table  below sets forth, as of December 31, 1999, the number of shares
of  Common  Stock of the company beneficially owned by each officer and director
of  the  company,  individually  and as a group, and by each person known to the
company  to  be  the  beneficial  owner  of more than five percent of the Common
Stock.
<TABLE>
<CAPTION>
                                            Number  of
                                            Shares  of
     Name  and  Address                    Common  Stock            Percent
     ------------------                    -------------            -------
<S>                                           <C>                     <C>
     Esmeralda  G.  Robbins(1)(2)             250,000                 8.2
     701  CCNB  North  Tower
     500  North  Shoreline
     Corpus  Christi,  TX  78471

     Donald  S.  Robbins(2)(3)(4)             250,000                 8.2
     701  CCNB  North  Tower
     500  North  Shoreline
     Corpus  Christi,  TX  78471
</TABLE>

                                       30
<PAGE>
<TABLE>
<CAPTION>
<S>                                           <C>                    <C>
     Gordon  W.  Allison(4)(5)                372,300                12.2
     P.  O.  Box  770304
     Oklahoma  City,  Oklahoma  73177

     James  Workman                            60,000                 2.0
     1826  War  Eagle  Street
     North  Little  Rock,  AR  72116

     Officers  and  Directors                 932,800                30.7
     as  a  group  (4  persons)(4)
     --------------------------------
</TABLE>


(1)     These  shares  are  held  of  record  by the Esmeralda G. Robbins Family
        Limited  Partnership.

(2)     Esmeralda  G.  Robbins  and  Donald  S.  Robbins  are  wife and husband.

(3)     These  shares are held of record by the Donald S. Robbins Family Limited
        Partnership.

(4)     This  does  not include 75,669 shares of Series A Preferred Stock of the
        company,  which  shares are owned by Mr. Robbins (43,869 shares) and Mr.
        Allison (31,800 shares), each share of which Preferred Stock is entitled
        to receive an $0.80 annual  dividend,  payable  quarterly, cumulative if
        not paid, has a face  value  of $10, is redeemable by the company out of
        profits, and is preferred over the company's  Common  Stock in the event
        of the liquidation and dissolution of the  company.

(5)     This  stock  is  held  of  record  by  Electronic Data Service, Inc., an
        Oklahoma  corporation,  of  which  Mr.  Allison  is an officer, director
        and 100 percent  beneficial  shareholder.

Changes  in  Control
--------------------

     There  are  no  arrangements which may result in a change in control of the
company.

ITEM     12.     CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

     There  have  been  no  transactions  during the past two years, or proposed
transactions,  to  which  our  company  was  or  is  to be a party, in which any
director,  executive  officer,  nominee  for election as a director, a holder of
more  than  five  percent  of  our voting stock or any member of their immediate
family  had  or  is  to  have  a  direct  or  indirect  material  interest.

     Our company's "parents" may be deemed to be Esmeralda G. Robbins, Donald S.
Robbins  and  Gordon  W.  Allison  by  reason of their positions as officers and
directors  of  the  company and their stock ownership as reflected in the tables
above.

ITEM     13.     EXHIBITS  AND  REPORTS  ON  FORM  8-K

(a)     Exhibits

                                       31
<PAGE>

     The following exhibits are filed, by incorporation by reference, as part of
this  Form  10-KSB:

     Exhibit  No.                       Description
     ------------                       -----------

        3         -     Amended  and  Restated  Articles   of  Incorporation  of
                        Consortium  Service  Management  Group,  Inc.*

        3.1       -     Bylaws  of  Consortium  Service  Management Group, Inc.*

       10         -     Founders'  Agreement  of United Engineering Company*

       10.1       -     Statutes  (Bylaws)  of United Engineering Company*

       10.2       -     Agreement of  April 24, 1996  between Consortium Service
                        Management Group, Inc. and  The L Group, Inc. concerning
                        tissue bonding technology*  (rescinded in January  2000)

       10.3       -     Agreement of  July 9, 1996  between  Consortium  Service
                        Management  Group,  Inc.    and   International  Welding
                       concerning tissue bonding  technology*

       10.4       -     Agreement  among  Consortium  Service  Management Group,
                        Inc., United  Engineering Company and Ivan V. Semenenko,
                        the inventor of the anaerobic  farm  waste  technology*

       10.5       -     Agreement  of   June 9, 1998  among  Consortium  Service
                        Management  Group,  Inc.,    The  Sumy  Frunze   Machine
                        Building Science and  Production Association, and United
                        Engineering Company  concerning the anaerobic farm waste
                        technology*

       10.6       -     Agreement between  Consortium  Service Management Group,
                        Inc. and  Western  Waste Management, Inc. concerning the
                        anaerobic farm waste  technology*

       10.7       -     Agreement  between  Consortium Service Management Group,
                        Inc.  and   Aardema Dairy concerning  the anaerobic farm
                        waste technology*

       10.8       -     Agreement  between  Consortium Service Management Group,
                        Inc. and  John and Ruth Beukers concerning the anaerobic
                        farm waste technology*

       10.9       -     Agreement    of  December  1998   between  International
                        Welding   Association  of  Kiev, Ukraine  and Consortium
                        Service  Management Group, Inc.  concerning  the  carbon
                        dioxide  separator  technology*

                                       32

       10.10      -     Operating  Agreement of June 14, 2001 between Consortium
                        Service  Management Group, Inc.  and Resource Technology
                        Corporation***

       10.11      -     Contract  Agreement  Effective   August 14, 2000 between
                        Consortium  Service  Management   Group/Anaerobic   Farm
                        Waste Co. and Rondeau Anaerobic***

       10.12      -     Contract IAW-USA 002-PR-19.04.2000 between International
                        Association  Welding,  Kiev   and   E.O.  Paton Electric
                        Welding Institute National Academy  Science  Ukraine and
                        Consortium Service Management Group,  Inc.***

       10.13       -    Contract IAW-USA 003-PR-19.04.2000 between International
                        Association   Welding,  Kiev  and  E.O.  Paton  Electric
                        Welding  Institute  National  Academy   Science  Ukraine
                        and Consortium Service Management Group,  Inc.***

       10.14       -    Contract IAW-USA 004-PR-19.04.2000 between International
                        Association   Welding,  Kiev  and  E.O.  Paton  Electric
                        Welding  Institute  National   Academy  Science  Ukraine
                        and Consortium Service Management Group,  Inc.***

       10.15       -    Contract IAW-USA 005-PR-19.04.2000 between International
                        Association  Welding,   Kiev  and  E.O.  Paton  Electric
                        Welding Institute National Academy  Science  Ukraine and
                        Consortium Service Management Group,  Inc.***

       10.16       -    Contract IAW-USA 006-PR-19.04.2000 between International
                        Association   Welding,  Kiev  and  E.O.  Paton  Electric
                        Welding Institute National Academy  Science  Ukraine and
                        Consortium Service Management Group,  Inc.***

       10.17       -    Contract IAW-USA 007-PR-19.04.2000 between International
                        Association  Welding,   Kiev  and  E.O.  Paton  Electric
                        Welding Institute National Academy  Science  Ukraine and
                        Consortium Service Management Group,  Inc.***

       10.18       -    Contract     IAW-USA 008-PR     between    International
                        Association  Welding,  Kiev,   Ukraine  and   Consortium
                        Service Management Group, Inc.***

       16          -    Letter  dated  January 29, 2000  from  Jaak (Jack) Olesk
                        to   Consortium  Service  Management  Group,  Inc.   Re:
                        Termination as Auditor**

                                       33
<PAGE>

       27          -    Financial  Data  Schedule

       99          -    Ukraine    Ministry   of   Health,   State   Department,
                        Certificate  of  State  Registration  No.  1105-193***

     *Previously filed with Form 10-SB; Commission File No. 0-27359 incorporated
     herein.

     **Previously  filed with Amendment No. 1 to Form 10-SB; Commission File No.
     0-27359  incorporated  herein.

     ***Previously filed with Amendment No. 2 to Form 10-SB; Commission File No.
     0-27359  incorporated  herein.

 (b) Reports  on  Form  8-K

     None













                                       34

                                   SIGNATURES


     In accordance with Section 15(d) of the Exchange Act, the registrant caused
this  report  to  be  signed  on  its  behalf by the undersigned, thereunto duly
authorized.

                                   CONSORTIUM  SERVICE  MANAGEMENT
                                   GROUP,  INC.



Date:  October  31,  2001          By/s/Donald S. Robbins
                                     -------------------------------------------
                                     Donald S. Robbins, Chief Executive Officer

     In  accordance  with  the  Exchange Act, this report has been signed by the
following  persons  on behalf of the registrant and in the capacities and on the
dates  indicated.



Date:  October  31,  2001            /s/Donald S. Robbins
                                     -------------------------------------------
                                     Donald  S.  Robbins,  President,  Chief
                                       Executive  Officer  and  Director



Date:  October  31,  2001            /s/Esmeralda G. Robbins
                                     -------------------------------------------
                                     Esmeralda  G.  Robbins,  Chairman  of  the
                                       Board  and  Director



Date:  October  31,  2001            /s/Gordon W. Allison
                                     -------------------------------------------
                                     Gordon W. Allison,  Chief Financial Officer
                                       and  Director



Date:  October  31,  2001            /s/James Workman
                                     -------------------------------------------
                                     James  Workman,  Director

                                       35
<PAGE>

                            FINANCIAL DATA SCHEDULE
<TABLE>
<CAPTION>
<S>                                                               <C>
Period  Type                                                              Year
Fiscal  Year  End                                                 DEC  31-1999
Period  Start                                                     JAN  01-1999
Period  End                                                       DEC  31-1999
Cash                                                                         0
Securities                                                             161,976
Receivables                                                                600
Allowances                                                                   0
Inventory                                                                    0
Current  Assets                                                            600
PP&E                                                                    58,518
Depreciation                                                            28,014
Total  Assets                                                          268,529
Current  Liabilities                                                   612,760
Bonds                                                                        0
Preferred  Mandatory                                                         0
Preferred                                                                   76
Common                                                               1,913,230
Other  SE                                                           (2,257,537)
Total  Liability  and  Equity                                          268,523
Sales                                                                   10,000
Total  Revenue                                                          10,000
CSG                                                                          0
Total  Costs                                                                 0
Other  Expenses                                                        372,469
Loss  Provision                                                        (46,847)
Interest  Expense                                                            0
Income  Pretax                                                        (443,799)
Income  Tax                                                                  0
Income  Continuing                                                    (443,799)
Discontinued                                                                 0
Extraordinary                                                                0
Changes                                                                      0
Net  Income                                                           (443,799)
EPS  Primary                                                             (0.16)
EPS  Diluted                                                             (0.16)
</TABLE>

                                                                      Exhibit 27
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