BLUE LANTERN LEVEL 3: END USE CHECK ON

UNCLAS ABU DHABI 002187 SIPDIS STATE FOR PM/DTCC - BLUE LANTERN COORDINATOR ROME FOR DHS ATTACHE E.O. 12958: N/A TAGS: KOMC ETTC TC SUBJECT: BLUE LANTERN LEVEL 3: END USE CHECK ON APPLICATION 05-918265 ¶1. On June 23, 2004, Commercial Officer Mary O'Brien met with Mumtaz A. Kayyali, General Manager of Gulf Aerospace Company, aka GACO, at GACO's offices in Abu Dhabi. Mr. Kayyali, who is an aeronautical engineer, received his degree from the University of Cairo and also studied in the UK. He served in the UAE air force for 25 years and retired from there a little over 2 years ago, when he established GACO. GACO is part of a group of companies owned by Mohammed al Qamzi, general manager of Etisalat, the UAE telecommunications giant. The group also includes other companies that have checked out favorably by the Foreign Commercial Service (FCS) in the UAE. ¶2. GACO is a relatively small company with six employees and sells only to the UAE military. GACO does not export any products from the UAE and has no business dealings with any nations embargoed by the U.S. GACO has been working with FCS UAE on other UAE air force projects, including the `hush house' for the F-16 fighter aircraft soon to be delivered to the UAE. GACO expects to sign that contract in conjunction with the U.S. company, Vitalink, in the next 7-10 days. GACO has recently signed a full-on support contract with the UAE air force that will give GACO priority consideration and more favorable payment terms. ¶3. GACO is also in partnership with a UK firm, Maplin, to provide technical assistance to the UAE navy. Maplin in partnership with GACO has 3 people located at the port of Jebel Ali to provide support to frigates based there. ¶4. GACO was the purchaser for the items shipped under State Department export license 05-918265. After a competitive bidding process, GACO was awarded the bid acceptance and purchased the goods from Aviation Support International. As is the usual practice here in the UAE, the goods were shipped from the U.S. on May 1, 2004, consigned directly to UAE GHQ General Purchasing Directorate. The goods never came into the possession of GACO as the purchaser. GHQ cleared the goods from customs and in this case, the items were delivered to the armed forces' stores in Suwaihan. Mr. Kayyali provided Commoff with a copy of the delivery order showing that the goods were received by the UAE armed forces in Suwaihan on 5/17/2004. ¶5. These items will be used by the UAE air force's own technicians and will not be installed by GACO personnel. GACO therefore has no information as to the current status of the items except that they are in the possession of the UAE air force. ¶6. Commoff considers GACO a reliable recipient of U.S. origin goods and technology. ALBRIGHT