EXTRANCHECK: POST SHIPMENT VERIFICATION:

UNCLAS HONG KONG 001067

SIPDIS

USDOC FOR 532/OEA/LHINES/DFARROW
USDOC FOR 3132 FOR FCS/OIO REGIONAL DIRECTOR WILLIAM
ZARIT
BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS

SIPDIS

E.O. 12958: N/A
TAGS: BMGT BEXP HK ETRD ETTC
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION:
PHILIPS ELECTRONICS (HK) CO. LTD.

REF: A) USDOC 02960

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


2. As per reftel A request and at the direction of the
Office of Enforcement Analysis (OEA) of the USDOC
Bureau of Industry and Security (BIS),Export Control
Officer Philip Ankel (ECO) conducted a post shipment-
verification at FEI Hong Kong Company Limited, Room
1508, Greenfield Tower, Concordia Plaza, 1 Science
Museum Road, Kowloon, Hong Kong (FEI Hong Kong). The
item in question is an Edax Genesis XM4 System exported
to FEI Hong Kong on or about March 4, 2007 and valued
at USD 48,000. On the applicable shippers export
declaration (SED),the item is classified as 3A999.
Items properly classified as 3A999 may be
exported/reexported to virtually all destinations and
end-users worldwide, license free except for certain
designated state sponsors of terrorism (including North
Korea). The exporter was Edax, Inc. of Mahwah, New
Jersey.


3. According to the Hong Kong Companies Registry, FEI
Hong Kong has been in existence since 1999. Its paid-
up share capital is the Hong Kong equivalent of
approximately USD 200,000. The Commercial Registry
lists U.S. nationals John Doherty and Stephen Loughlin
as directors. FEI Hong Kong is an affiliate office of
FEI Company headquartered in Hilsboro, Oregon. (more
information at www.fei.com).


4. On April 13, 2007, the ECO met with Ms. Susan Y.C.
Chan, the FEI Hong Kong Sales and Service Coordinator
as well as Raymond Wan, Warehouse Manager for Philips
Electronics Hong Kong Ltd. and Mr. Tony Yiu, the Senior
Manager for Transport and Storage. Mr. Wan did most of
the talking and first clarified that, until December of
2006, Royal Philips Electronics (www.philips.com)
("Philips") had held a significant stake in FEI
Company. While Philips had divested itself of its FEI
Company stake, Philips Electronics Hong Kong Ltd.
continues to provide logistic support services for FEI
Hong Kong (including trade compliance services) on a
contract basis.


5. Mr. Wan then provided a detailed review of the
overall corporate-wide trade control procedures of
Philips. He spoke from slides he had prepared for a
Hong Kong and Japanese joint conference on export
controls held in 2006 in Hong Kong. The overall
Philips trade compliance program is quite impressive
and this ECO now knows whom to call if he ever needs a
private sector speaker in the area of export controls
in Hong Kong.


6. As to the specific item in question, Mr. Wan and
Ms. Chan provided the ECO with documentation indicating
that the item had been received in Hong Kong and
subsequently shipped to the end-user in Shanghai,
namely the Shanghai Institute of Technology. A
subsequent e-mail from the salesman involved in the
transaction revealed that the item will be used in the
characterization and analysis of materials, including
metals, ceramics, and polymers.


7. The ECO recommends that this check be categorized
as Favorable.