IRAN NONPROLIFERATION ACT OF 2000: DEMARCHE ON

S E C R E T VIENNA 003912 SIPDIS FOR ISN/CWTR, ISN/MTR, EUR/AGS, AND EUR/PRA E.O. 12958: DECL: 12/19/2015 TAGS: PARM PREL MNUC ETTC AU MTCRE SUBJECT: IRAN NONPROLIFERATION ACT OF 2000: DEMARCHE ON STEYR-MANNLICHER SANCTIONS DELIVERED REF: A) STATE 226158 B) VIENNA 3679 C) VIENNA 3737 Classified By: Acting Economic-Political Counselor Michael R. DeTar for reasons 1.5(b) and (d). Demarche Delivered -------------- ¶1. (S) On December 19, Econ Unit Chief delivered ref A talking points to Helmut Krehlik, Head of the Ministry of Economy's Export Control Division, notifying the GoA of impending sanctions against Steyr-Mannlicher under the Iran Nonproliferation Act of 2000. Krehlik thanked the USG for advance notice of the sanctions and promised to inform Minister of Economy Martin Bartenstein and other relevant GoA officials. Concerns Remain About Weapons Technology Transfers -------------- -------------- ¶2. (S/NF) Krehlik said he was "certain" that Steyr-Mannlicher CEO Wolfgang Fuerlinger intends to sell weapons technology via his Malaysian joint venture to the highest bidder (refs B and C). According to Krehlik, French Government officials have recently raised similar concerns with the GoA. Krehlik noted that Fuerlinger had specifically asked him 6-8 months ago whether or not Steyr-Mannlicher would need an export license to transfer technology via "intangible media," i.e., via computer. Krehlik explained that prior to October 1, 2005, when Austria' new Foreign Trade Act (FTA) came into effect, only physical transfers required an MoE license. Krehlik opined that Fuerlinger has probably already transferred the weapons technology electronically. The GoA could not prosecute him for such an action prior to October 1, based on the loophole in the old FTA. ¶3. (S) Krehlik reiterated that the GoA could prosecute Steyr-Mannlicher for arms brokering under the amended FTA (ref C),if Steyr-Mannlicher transfers weapons technology outside of Austria from one non-EU state to another non-EU country. Krehlik said, however, it would be very difficult to prove such a transfer, absent access to Steyr's accounting books. Even if the police did obtain a warrant to search Steyr-Mannlicher's offices, Krehlik doubted the company would keep detailed records of weapons technology transfers, which would expose it to prosecution. MCCAW