EXTRANCHECK: POST SHIPMENT VERIFICATION: NEW

UNCLAS HONG KONG 004023

SIPDIS

USDOC FOR 532/OEA/LHINES/DFARROW
USDOC FOR 3132/FCS/OIO REGIONAL DIRECTOR WILLIAM ZARIT

BEIJING FOR FCS JEANETTE CHU

BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS

SIPDIS

E.O. 12958: N/A
TAGS: BMGT BEXP HK ETTC
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION: NEW
COSMOS (H.K.) LTD.

REF: A) USDOC 05351


1. Unauthorized disclosure of the information provided
below is prohibited by Section 12C of the Export
Administration Act.


2. As per reftel A request ad at the direction of the
Office of Enforcement nalysis (OEA) of the Bureau of
Industry and Secuity (BIS),Export Control Officer
(ECO) Philip Akel onducted a post shipment
verification (PSV) t New Cosmos (H.K.) Ltd. (New
Cosmos H.K.) on Ocober 10, 2006. This PSV concerned
parts for massspectrometers exported by Brimrose
Corporatin of Sparks, Maryland, classified as EAR99
and valued at $26,399.


3. An extract from the Hong Kong Companies Registry
provides that New Cosmos has been registered as a
company in Hong Kong since March 1999. The registered
address matches the address where the check was
conducted. New Cosmos H.K.'s corporate registration
lists three directors by their Chinese passport
numbers and without Hong Kong identification card
numbers (PRC nationals Jing Huang, Zhipeng Pei,
Jinsong Wang). One director is listed by reference to
a Hong Kong I.D. card number(Qingpei Zhao).


4. On October 10, 2006, the ECO visited New Cosmos at
Room B, 32/F, United Centre, 95 Queensway, Hong Kong
and met with Debbie Fok, Assistant General Manager.
The New Cosmos office is located inside of the offices
of China Legal Service (H.K.) Ltd.
(www.chinalegal.com.hk) and there is no reference to
New Cosmos on the exterior of the office or in the
building registry. The meeting occurred in a small
conference room in the offices of China Legal Service
(H.K.) Ltd. Ms. Fok stated that New Cosmos has been
in existence for about five years and has a
representative office in Beijing (listed on Ms. Fok's
business card as being located at Room 2004, Building
B, Jianwai SOHO, 39 Dongsanhuanzhong Road, Chaoyand
District, Beijing) (New Cosmos Beijing). Ms. Fok
stated that New Cosmos H.K. (and its Beijing
representative office) acts as a trading company to
obtain items from the United States and elsewhere on
behalf of Chinese clients. She stated that the main
business area of focus is telecommunications. She
further stated that, to the degree a U.S. export
license is required, this is the responsibility of the
U.S. exporter.


5. Ms. Fok confirmed that New Cosmos (H.K.) had
received the items that were the subject of the PSV.
She stated that the items were ordered by and for
Tsinghua University in Beijing through New Cosmos

SIPDIS
Beijing. A separate item that is the subject of a
separate PSV cable was also destined for Tsinghua
University. The items were shipped to Hong Kong and
not directly to Beijing at the request of Tsinghua
University. Once New Cosmos H.K. had received them,
Ms. Fok called New Cosmos Beijing and a representative
of Tsinghua University picked them up from New Cosmos
H.K.'s offices. Ms. Fok further stated that the
exporter (Brimrose) was aware of the end-user of the
items.


6. Ms. Fok was somewhat reluctant to provide any
additional information about the transaction in
question (and a related transaction that is the
subject of a separate cable). Fok declined to provide
additional documentation on the destination of the
shipment. At the same time, the items in question
were classified by the exporter as EAR99 and could
therefore, absent EPCI concerns or misclassification,
be exported or reexported to China. BIS may wish to
reach out to the exporter to determine why it chose to
list New Cosmos (H.K.) as the ultimate consignee.


7. It is apparent to the ECO that New Cosmos H.K. and,
most likely, New Cosmos, Beijing are trading companies
that do not engage in production or manufacturing of
any kind. While Ms. Fok was reluctant to provide
additional information about the shipment in question,
her answers were not evasive or untruthful and were
consistent with the information in documents provided
by BIS. Therefore, in accordance with guidance on
reporting of PSVs where the items cannot be physically
inspected, the ECO recommends that this PSV be
classified as Limited.
Cunningham