[Federal Register Volume 70, Number 209 (Monday, October 31, 2005)]
[Notices]
[Pages 62295-62297]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-21621]


-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

Bureau of Industry and Security

[Docket No: 051017266-5266-01]


Revision to the Unverified List--Guidance as to ``Red Flags''

AGENCY: Bureau of Industry and Security, Commerce.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: On June 14, 2002, the Bureau of Industry and Security 
(``BIS'') published a notice in the Federal Register that set forth a 
list of persons in foreign countries who were parties to past export 
transactions where pre-license checks or post-shipment verifications 
could not be conducted for reasons outside the control of the U.S. 
Government (``Unverified List''). Additionally, on July 16, 2004, BIS 
published a notice in the Federal Register that advised exporters that 
the Unverified List would also include persons in foreign countries in 
transactions where BIS is not able to verify the existence or 
authenticity of the end-user, intermediate consignee, ultimate 
consignee, or other party to the transaction. These notices advised 
exporters that the involvement of a listed person as a party to a 
proposed transaction constitutes a ``red flag'' as described in the 
guidance set forth in Supplement No. 3 to 15 CFR part 732, requiring 
heightened scrutiny by the exporter before proceeding with such a 
transaction. This notice adds five entities to the Unverified List. The 
entities are: T.Z.H. International Co. Ltd., Room 23, 2/F, Kowloon Bay 
Ind Center, No. 15 Wany Hoi Rd, Kowloon Bay, Hong Kong, Special 
Administrative Region; Design Engineering Center, House 184, Street 36, 
Sector F-10/1, Islamabad, Pakistan; Kantry, 13/2 Begovaya Street, 
Moscow, Russia 125284; Elaton Company, 20B Berezhkovskaya Naberezhnaya, 
Moscow, Russia; and Pskovenergo Service, 47-A Sovetskaya Street, Pskov, 
Russia Federation, 180000.

DATES: This notice is effective October 31, 2005.

FOR FURTHER INFORMATION CONTACT: Thomas W. Andrukonis, Office of 
Enforcement Analysis, Bureau of Industry and Security, Telephone: (202) 
482-4255.

SUPPLEMENTARY INFORMATION: In administering export controls under the 
Export Administration Regulations (15 CFR parts 730 to 774) (``EAR''), 
BIS carries out a number of preventive enforcement activities with 
respect to individual export transactions. Such activities are intended 
to assess diversion risks, identify potential violations, verify end-
uses, and determine the suitability of end-users to receive U.S. 
commodities or technology. In carrying out these activities, BIS 
officials, or officials of other federal agencies acting on BIS's 
behalf, selectively conduct pre-licence checks (``PLCs'') to verify the 
bona fides of the transaction and the suitability of the end-user or 
ultimate consignee. In addition, such officials sometimes carry out 
post-shipment verifications

[[Page 62296]]

(``PSVs'') to ensure that U.S. exports have actually been delivered to 
the authorized end-user, are being used in a manner consistent with the 
terms of a license or license exception, and are otherwise consistent 
with the EAR.
    In certain instances BIS officials, or other federal officials 
acting on BIS's behalf, have been unable to perform a PLC or PSV with 
respect to certain export control transactions for reasons outside the 
control of the U.S. Government (including a lack of cooperation by the 
host government authority, the end-user, or the ultimate consignee). 
BIS listed a number of foreign end-users and consignees involved in 
such transactions in the Unverified List that was included in BIS's 
Federal Register notice of June 14, 2002. See 67 FR 40910. On July 16, 
2004, BIS published a notice in the Federal Register that advised 
exporters that the Unverified List would also include persons in 
foreign countries where BIS is not able to verify the existence or 
authenticity of the end user, intermediate consignee, ultimate 
consignee, or other party to an export transaction. See 69 FR 42652.
    The June 14, 2002 and July 16, 2004 notices advised exporters that 
the involvement of a listed person in a transaction constituted a ``red 
flag'' under the ``Know Your Customer'' guidance set forth in 
Supplement No. 3 to 15 CFR part 732 of the EAR. Under that guidance, 
whenever there is a ``red flag,'' exporters have an affirmative duty to 
inquire, verify, or otherwise substantiate the proposed transaction to 
satisfy themselves that the transaction does not involve a 
proliferation activity prohibited in 15 CFR part 744, and does not 
violate other provisions of the EAR. The Federal Register notices 
further stated that BIS may periodically add persons to the Unverified 
List based on the criteria set forth above, and remove persons when 
warranted.
    This notice advises exporters that BIS is adding T.Z.H. 
International Co. Ltd. in the Hong Kong Special Administrative Region, 
Design Engineering Center in Pakistan, Kantry in Russia, Elaton Company 
in Russia, and Pskovenergo Service in Russia to the Unverified List. A 
``red flag'' now exists for transactions involving these entities due 
to their inclusion on the Unverified List. As a result, exporters have 
an affirmative duty to inquire, verify, or otherwise substantiate the 
proposed transaction to satisfy themselves that the transaction does 
not involve a proliferation activity prohibited in 15 CFR part 744, and 
does not violate other provisions of the EAR.
    The Unverified List, as modified by this notice, is set forth 
below.

Wendy Wysong,
Deputy Assistant Secretary for Export Enforcement.

Unverified List (as of October 31, 2005)

    The Unverified List includes names, countries, and last known 
addresses of foreign persons involved in export transactions with 
respect to which: the Bureau of Industry and Security (``BIS'') could 
not conduct a pre license check (``PLC'') or a post shipment 
verification (``PSV'') for reasons outside of the U.S. Government's 
control; and/or BIS was not able to verify the existence or 
authenticity of the end user, intermediate consignee, ultimate 
consignee or other party to an export transaction. Any transaction to 
which a listed person is a party will be deemed to raise a ``red flag'' 
with respect to such transaction within the meaning of the guidance set 
forth in Supplement No. 3 to 15 CFR part 732. The red flag applies to 
the person on the Unverified List regardless of where the person is 
located in the country included on the list.

----------------------------------------------------------------------------------------------------------------
                 Name                             Country                         Last known address
----------------------------------------------------------------------------------------------------------------
Lucktrade International..............  Hong Kong Special             P.O. Box 91150, Tsim Sha Tsui, Hong Kong.
                                        Administrative Region.
Brilliant Intervest..................  Malaysia....................  14-1, Persian 65C, Jalan Pahang Barat,
                                                                      Kuala Lumpur, 53000.
Dee Communications M SDN. BHD........  Malaysia....................  G5/G6, Ground Floor, Jin Gereja, Johor
                                                                      Bahru.
Peluang Teguh........................  Singapore...................  203 Henderson Road <greek-i>09-05H,
                                                                      Henderson Industrial Park.
Lucktrade International PTE Ltd......  Singapore...................  35 Tannery Road <greek-i>01-07 Tannery
                                                                      Block, Ruby Industrial Complex, Singapore,
                                                                      Ltd. 347740.
Arrow Electronics Industries.........  United Arab Emirate.........  204 Arbift Tower, Benyas Road, Dubai.
Jetpower Industrial Ltd..............  Hong Kong Special             Room 311, 3rd Floor, Wing On Plaza, 62 Mody
                                        Administrative Region.        Road, Tsim Sha Tsui East, Kowloon.
Onion Enterprises Ltd................  Hong Kong Special             Room 311, 3rd Floor, Wing On Plaza, 62 Mody
                                        Administrative Region.        Road, Tsim Sha Tsui East, Kowloon.
Lucktrade International..............  Hong Kong Special             Room 311, 3rd Floor, Wing On Plaza, 62 Mody
                                        Administrative Region.        Road, Tsim Sha Tsui East, Kowloon.
Litchfield Co. Ltd...................  Hong Kong Special             Room 311, 3rd Floor, Wing On Plaza, 62 Mody
                                        Administrative Region.        Road, Tsim Sha Tsui East, Kowloon.
Sunford Trading Ltd..................  Hong Kong Special             Unit 2208, 22/F, 118 Connaught Road West.
                                        Administrative Region.
Parrlab Technical Solutions, LTD.....  Hong Kong Special             1204, 12F Shanghai Industrial Building, 48-
                                        Administrative Region.        62 Hennesey Road, Wan Chai.
T.Z.H. International Co. Ltd.........  Hong Kong Special             Room 23, 2/F, Kowloon Bay Ind Center, No.
                                        Administrative Region.        15 Wany Hoi Rd, Kowloon Bay.
Design Engineering Cebter............  Pakistan....................  House 184, Street 36, Sector F-10/1,
                                                                      Islamabad.
Kantry...............................  Russia......................  13/2 Begovaya Street, Moscow.
Elaton Company.......................  Russia......................  20B Berezhkovskaya Naberezhnaya, Moscow.
Pskovenergo Service..................  Russia......................  47-A Sovetskaya Street, Pskov, Russia
                                                                      Federation, 180000.
----------------------------------------------------------------------------------------------------------------


[[Page 62297]]

[FR Doc. 05-21621 Filed 10-28-05; 8:45 am]
BILLING CODE 3510-33-P