EXTRANCHECK: PRE-LICENSE CHECK: Vegetable

UNCLAS HONG KONG 000418 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: PRE-LICENSE CHECK: Vegetable Marketing Organization REF: A) USDOC 00750 B) EXP.LIC. D369973 ¶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),accompanied by Commercial Assistant, Sandy Lai, conducted a pre-license check (PLC) at the Vegetable Marketing Organization (VMO)757 Lai Chi Kok Road, Cheung Shawan, Kowloon, Hong Kong. The purpose of the PLC was to determine the suitability of VMO to be the recipient of virtual private network software. The item (ECCN 5A002) is valued at approximately USD $143,000 and is controlled for national security (NS) reasons. The license applicant is F5 Networks, Inc. of Seattle, Washington. ¶3. The VMO is a self-financing, non-profit entity originally set up to assist in the post-war rehabilitation of local farming and to provide facilities for marketing of vegetables. Presently, the VMO operates a wholesale vegetable market at the address referenced above. While the VMO is independent from the Hong Kong government, its director is the Director of the Hong Kong Department of Agriculture, Fisheries and Conservation. ¶4. On February 9, 2006, the ECO and Commercial Assistant visited VMO at the address above and met with Mr. Ka Kit Au, Market Manager (Development). Mr. Au described the wholesale market business of VMO, where the software will be used. In particular, the VMO's wholesale market acts as broker in nearly 50% of all wholesale vegetable trades in Hong Kong and clears 50,000-60,000 transactions per day. The facility itself is located in one square block. The information Mr. u provided is consistent with the information onthe VMO web site: www.vmo.org. Other backgroundinformation may be found at this web site as wel. ¶5. Mr. Au stated that VMO would like to purchse the VPU software so that it can join three neworks that presently exist both within the facilty itself and at one location nearby. Mr. Au stated that a tender process for this item and related items is presently under way and VMO has not yet chosen a final vendor. ¶6. VMO was very forthcoming during the PLC visit. Mr. Lee provided information on the underlying transaction and VMO's intent to use the item for its operations in Hong Kong. The ECO recommends that this PLC be considered Favorable. Cunningham