BLUE LANTERN LEVEL 3: PRE-LICENSE END USE CHECK

1. POL and FCS officers visited Lovac Trgovina on
June 8, 2005. Post recommends the approval of the
application for export of Smith and Wesson revolvers to
the firm.



2. Lovac Trgovina D.O.O. is a bona fide retail
distribution firm of handguns and rifles in Croatia. The
firm was founded in 1952 and purchased by its current
owner, Mario Plejic, in 1995. The primary focus of
business is the sale of hunting weapons and related gear
within the Croatian civilian market as well as sales to
Croatian law enforcement agencies. According to its
owner, Lovac Trgovina is the leading sporting arms
distributor in Croatia with an estimated annual turnover
of USD 2 million and an estimated market share of 75
percent.



3. Lovac Trgovina's order of 38 revolvers is consistent
with their current sales focus. As stated on the
application, the firm offices and store are located in
Zagreb. Post officers inspected the firm office, store,
weapons storage facilities, and record-keeping
processes. The firm has secure storage facilities and
detailed record keeping procedures as required by
Croatian law. Lovac Trgovina maintains detailed
permanent records of all purchasers. Under Croatian law,
individuals must present a valid permit issued by the
Ministry of Interior before purchasing a firearm and all
individual weapons sales must be reported, complete with
serial number, to police authorities. Lovac Trgovina's
owner, Plejic, was well versed in USML restrictions
regarding re-export and re-transfer of arms and is
willing to comply accordingly.

FRANK


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