TAIWAN MOVES ON EXPORT CONTROL COMMITMENTS

S E C R E T SECTION 01 OF 02 TAIPEI 001619

SIPDIS

SIPDIS

STATE FOR EAP/TC AND ISN/MTR
DEPARTMENT PLEASE PASS TO NSC WASHINGTON DC PRIORITY

E.O. 12958: DECL: 05/04/2026
TAGS: ECCT PARM MTCRE JP TW
SUBJECT: TAIWAN MOVES ON EXPORT CONTROL COMMITMENTS

REF: A. STATE 73453


B. STATE 3095

C. TAIPEI 1566

D. TAIPEI 1337

Classified By: AIT ACTING DEPUTY DIRECTOR CHARLES BENNETT,
REASONS 1.4 B, C.


1. (S) AIT delivered ref A talking points to Export Control
Task Force Head Wally Su and received a report from Su on the
investigation into machine tools orders from the Iranian
company Azma Pisheh and the Syrian company Sinan that we
requested in ref B. AIT has sent an informal translation of
the investigation report to EAP/TC and ISN/MTR. Action
request para 7. End summary.


2. (S) AIT delivered ref A talking points to Taiwan Ministry
of Economic Affairs (MOEA) Bureau of Foreign Trade (BOFT)
Export Control Task Force Head Wally Su on May 9. Su was
intrigued by our offer to assist BOFT in developing an
outreach and education campaign and asked for more details on
what types of assistance we could provide. He said that
assistance in industry outreach, ideally involving
presentations by U.S. companies on how they dealt with export
control regulations, was precisely what Taiwan's export
control efforts needed most right now. He referred to the
outreach seminar that Japan organized in Taipei in March as a
model. (Note: CSI Kaohsiung Acting Team Leader CJ Lou told
AIT Econ on May 9 that explicit authorization from Washington
agencies was needed before any CSI resources could be used to
assist in targeting sensitive exports to Iran and North
Korea, and that such authorization had not yet been received.
End note.)


3. (S) In response to the talking point that urged Taiwan to
give industry 60-90 days advance notice of the pending
tightening of export control regulations, Su said he did not
want to wait that long, but wanted to implement Taiwan's
commitments under the August 2005 export control "gameplan"
as soon as possible. Su expected the new licensing
requirements reported ref C will become effective around June

1. He said that so far there has been no negative reaction
from businesses to the publication of the new requirements,
only requests for more detailed information.


4. (S) Su said that as part of efforts to institutionalize a
focus on effective export controls he had drafted a section
on "export security" that will be added to MOEA's formal
strategic goals paper.


5. (S) Su also provided us with a letter dated April 28,
2006 which contains the results of the BOFT investigation
into possible Taiwan machine tool sales to Iran and Syria
(ref C). The investigation found that no corresponding
export licenses had been issued. The Taiwan LITZ Hitech
Corporation did not export any commodities to Iran in January
and February 2006, and neither LITZ or Eumatech exported any
commodities to Syria from September 2005 to February 2006.


6. (S) The report adds that to prevent such exports, BOFT has
1) asked Customs to add LITZ and Eumatech to its list of
high-risk manufacturers and to inspect all their exports; 2)
requested LITZ and Eumatech to apply for an export license
before making any export to Iranian or Syrian manufacturers;
and 3) added these two companies to the BOFT list of
companies that should be regularly inspected for complying
with export control regulations. An AIT informal translation
of the report has been emailed to EAP/TC and ISN/MTR.


7. (S) Action request: AIT requests clarification from
Washington agencies on what types of assistance we are
offering BOFT in developing an outreach and education
campaign. AIT also seeks front channel confirmation that CSI

TAIPEI 00001619 002 OF 002


Kaohsiung is authorized to use personnel and computer
resources to assist efforts to stop sensitive exports to Iran
and North Korea. AIT believes that CSI personnel in
Kaohsiung are well-positioned to assist in outreach efforts
to Taiwan industry associations.
YOUNG