BLUE LANTERN LEVEL 3: PRE-LICENSE END-USE CHECK ON

UNCLAS SECTION 01 OF 03 BANGKOK 007334

SIPDIS

DEPARTMENT FOR PM/DTCC -- BLUE LANTERN COORDINATOR
(JSTITZIEL)

E.O. 12958: N/A
TAGS: ETTC KOMC TH BLUE LANTERN
SUBJECT: BLUE LANTERN LEVEL 3: PRE-LICENSE END-USE CHECK ON
APPLICATION 05-979183

REF: SECSTATE 202710


1. Per reftel request, here are the results of posts
inquiries into the bona fides of G.H. International.

Company Profile
Per the Thai Department of Business Development, Ministry of
Commerce, G.H.International Co. Ltd is filed under
registration number 1160/2517, dated 9 OCT 1974. Capital
registration was 10,000,000 baht, the company executives are
listed as Mr. Sarabjit Singh Sachdev and Mr. Kuramak Singh
Sachdev. Address listed is 5 Soi Sukhumvit 30 (Santi
Naruman),Sukhumvit Rd., Khlong Tan Sub-District, Khlong Toei
District, Bangkok. The company has filed annual financial
reports for the years 1999-2005 inclusive.

Purpose of Company: To import the wholesale and retail sale
of guns, ammunition and military equipment.

There are 7 share holders, all members of the Sachdev family.
Four members of the family are Thai national and 3 are
Indian nationals. The company has two branch offices, one is
a gun shop in Bangkok, the other is a warehouse in Saraburi
for storage. According to Ministry of Commerce data, this
second facility is no longer in operation.

The Commerce website also lists four companies registered
under the "G.H. group." These include:

The G.H. Co. Ltd, registered in Bangkok in December 1986 for
weapons and goods wholesale and retail;
the G.H. Industry Co., Ltd, registered in Bangkok in July
1987 for textile production and trade;
The G.H. Development Co. Ltd, registered in Bangkok in July
1979 for real estate development, and;
The Thai National Trading Ltd., registered in Bangkok in
September 1960

G.H. International, Co., Ltd. is not listed in the telephone
directory, but G.H. Development Co. Ltd is listed.

POL FSN made an unannounced visit to G.H. International Co.
Ltd. on November 7, 2005 and was met by Mr. Sarabjit. The
company officers were on the second floor of a 20 story
upscale building in the prime Sukhumvit business area. Mr.
Sarabjit answered all questions posed in reftel:

3.1 Is the company recognized by the MOD/RTG as an official
military contractor/broker?

Yes. It is registered with the Commerce Ministry and is
recognized by the MOD as a qualified bidder on military
contracts. The company is also recognized by a number of
foreign governments.

3.2 Is the company state-owned, parastatal, or private?
Private.

3.3 How long has the company been in business, who are its
principals?

The company has been in business since October 1974. It has
the sister companies listed above and owns 5 gun shops and
two branches.

Principal shareholders are:


1. Mr. Kuramak Sing Sachdev, an Indian national -- 1,750
shares

2. Ms. Minderko Sachdev, an Indian national -- 1,750 shares

3. Mr. Saragjit Singh Sachdev, a Thai national -- 2,300
shares

4. Mr. Shatwinder Singh Sachdev, a Thai national -- 2,250
shares

5. Ms. Nimatjitkor Sachdev, an Indian national -- 700 shares

6. Ms. Amarit Sachdev, a Thai national -- 750 shares

7. Ms. Kiran Sachdev, a Thai national -- 500 shares.

3.5 Who are its typical customers and where are they located?

The company has four types of customers:

--General gun shops in Bangkok and rural Thailand, ordinary
citizens permitted by the Ministry of Interior to purchase
guns, and civil servants or military personnel allowed by the
Ministry of Interior to buy guns.

--State agencies for whom the company has bid on purchase
contracts. These include the Police Department, Royal Thai
Army, Nave and Air Force, Department of Provincial
Administration of the Ministry of Interior, the Royal
Forestry Department of the Ministry of Natural Resources and
Environment, the Airport Authority of Thailand, the State
Railway of Thailand, the Armed Forces Security Center, the
Prime Minister's Office, and the Bank of Thailand.

--Private companies and department stores such as security
firms, jewelry concerns, the Emporium Department Store, IBM,
the JW Marriott Hotel and some Embassies.

--Previously, the company sold explosives to mining
companies. These explosives were of Chinese manufacture and
stored in a facility under the supervision of the Ministry of
Interior in Saraburi.

3.6 Does the company have established, legitimate customer
bases to which they plan to sell the ammunition loaded by
this machinery?

The company is to sell, deliver, set up and provide the
maintenance of the contracted bullet loading-machinery
mentioned in reftel to the Military Explosives Factory owned
by the Ministry of Defense in Nakhorn Sawan. The factory is
the machine user and the seller of the finished products.
G.H. is not involved in the sale of ammunition loaded by the
machinery.

3.7 Does the company have adequate on-site security?

The company is located on the 2nd floor of a well established
residential building. The building has guards working in two
shifts, three guards per shift. It has CCTV and a water
sprinkler. The company claims to have 34 employees (FSN saw
only 10 on the day of his visit). Employees are not required
to have a criminal, fingerprint or background check. The
contracted machinery listed in reftel will be transported
into Thailand directly from Bangkok airport and delivered to
the MOD factory in Nakhon Sawan with a military escort. It
will not be stored at any G.H. facility.

3.8 Does the company keep proper, detailed records of its
sales and customers?

Yes. However, most records were in paper vice electronic
form. Records are regularly examined by Thai government
authorities. The company is a representative or broker for
the following foreign concerns:
Olin Winchester, BAE, Smith and Wesson, General Dynamics
Ordnance Tactical Systems, the Kilgore Corp., Remington and
MLM International.

3.9 Does the company understand the restrictions of USML
articles?

Generally yes although they promised to review the USML
guidelines from the Internet.

3.10 Does the company have the proper firearms license and
import permit of the items listed on the license application?

Yes. The company presented FSN with originals and copies of
various documents concerning the purchase. Included in these
were the Commerce Ministry license, PO No. 32005-34 dated
September 23, 2005, stating the items to be purchased in the
United States (all in accordance with details outlined in
reftel),DSP-83 signed by the company's Managing Director,
Mr. Sarabjit and the Military Explosives Factory Director,
Major General Siddhiporn, dated September 23, 2005 with the
MOD's supporting letter dated September 23, 2005 (all in
accordance with details outlined in reftel),and a purchase
contract for the items between G.H. International and the
Military Explosives Factory, on behalf of the MOD
Secretariat, No.8/2548, dated September 23, 2005.

SIPDIS


2. Also per reftel request, here is information on the bona
fides of the Military Explosives Factory, Defense Industry
Department, Defense Industry and Energy Center, Ministry of
Defense.

COL Phunsi Ratsami, Director of the Industry Control
Division, Thai Ministry of Defense, confirmed that the
Factory is owned and operated by the Royal Thai Ministry of
Defense.

Questions raised in reftel:

3.1 Is the company recognized by the MOD/Government of
Thailand as an official military contractor/broker?

Yes.

3.2 Is the company state-owned, parastatal or private?

It is a state-owned factory constructed in 1985 by a British
contractor, Nobel Explosive Col, Ltd, in accordance with U.S.
and NATO Standards and ISO 9001.2000.

3.3 How long has the company been in business and who are
its principals?

The Factory was built in 1985 and has been in operation after
that. The Factory is supervised by a Major General in the
Royal Thai Army who reports to the Defense Industry
Department. The Defense Industry Department is under the
Defense Industry and Energy Center, which is under the direct
supervision of the Permanent Secretary (Vice Minister) of the
MOD. The Factory has 617 officers, enlisted and civilian
employees.

3.5 Who are its typical customers and where are they located?

The Factory's major customers are the Armed Forces and Police
Departments nationwide. IN addition, 3 private companies:
Thai Arms Co., Ltd. in Ratchaburi; Bullet Master Co., Ltd. in
Kanchanaburi; and Olympic Co., Ltd of Nakhon Sawan are also
customers. These private concerns have only placed small
orders (100-200 kgs of explosive powder) at a time. There
have been no foreign customers.

3.6 Does the company have adequate on-site security?

Yes. POL FSN noted that the compound is surrounded by two
fences with armed soldiers guarding the perimeter. CCTVs, ID
card access control and guard towers are present. Officials
claim to have 70 armed guards working on a 4-hour shift in 11
locations augmented by guard dogs, foot and motorcycle
patrols and CCTV cameras. They have 2 fire trucks, a water
truck and a high-pressure sprinkler system. They claim to
have fire fighting foam. The nearest civilian fire station
is about 5 kilometers away.

POL FSN was not allowed to enter the inner Factory but saw
outside that building a low concrete wall, a man-made hill as
a blast barrier and a natural mountain behind the primary
storage facilities. Transport of finished explosives takes
place with a military escort.

3.8 Does the company keep proper and detailed records of its
sales and customers?

Yes. Most are in paper, not electronic form. All records
are regularly examined by the National Audit Commission and
the Office of Defense Auditing. All sales must be approved
by the PermSec of MOD. A foreign sale would need Cabinet
approval.

3.9. Does the company understand the restrictions of USML
articles?

Not at first, however POL FSN briefed officials on the major
requirements. The officials assured POL FSN that no
machinery would be designated for third party transfer
without USG approval.

3.10 Does the company have the proper firearms license and
import permit for the items listed on the license application?

Yes. Copies of all documents outlined in reftel conformed
with the details contained therein.
BOYCE