BLUE LANTERN PRE-LICENSE END USE CHECK ON

C O N F I D E N T I A L SECTION 01 OF 02 NICOSIA 000760

SIPDIS

SIPDIS

FOR PM/DTCC - BLUE LANTERN COORDINATOR PETER SABATINI

E.O. 12958: DECL: 09/13/2017
TAGS: CY EI ETTC KOMC
SUBJECT: BLUE LANTERN PRE-LICENSE END USE CHECK ON
APPLICATION 05-050054319

REF: A. A. SECSTATE 113031


B. B. NICOSIA 00663

Classified By: Deputy Chief of Mission Jane B. Zimmerman for reasons 1.
4 (b) and (d).


1. (SBU) On 07 September 2007, PolOff was contacted by
Yiannis Thedouolou, the Managing Director of Laserlabs Ltd.,
the Foreign Intermediate Consignee for the Reftel A requested
Pre-License Check (PLC) on Application 05-05005431927.
Theodoulou advised that Andor Technology, the Foreign
Consignee for the fiber optic coupler, had decided not to
wait for a U.S. export license and had obtained a similar,
Chinese component. Andor shipped the iStar camera to
Theodoulou and he planned on delivering it to Professor
Andreas Othonos, the Foreign End User, at the University of
Cyprus on 11 September. PolOff confirmed with Theodoulou
that the camera had been delivered as planned on 11
September. Prior to this development, PolOff had completed
site visits to both the University of Cyprus and Laserlabs on
27 and 31 August respectively. Post had planned on providing
a favorable report on the PLC for 05-05005431927. This has
been overtaken by events, but we would still like to document
the findings from our site surveys.


2. (SBU) On 27 August, PolOff met with Professor Andreas
Othonos at the University of Cyprus. Othonos showed PolOff
the physics laboratory where the iStar camera would be used.
Othonos showed PolOff the exact spot where the device would
be installed and stated he had no intention of using the
device anywhere but the lab and the location he had showed
PolOff. Othonos planned on using the camera as part of
dynamic research of semi-conductors, explaining the
camera/image intensifier would be attached to a spectrometer
and would allow him to track reactions in semi-conductors
which had been "excited" by laser light. The goal of the
research was to detect luminescence emitted by the
semi-conductors when they reacted to the laser beam. Othonos
advised that he, two post-doctorate researchers and four to
five graduate students would have access to the device. As
graduate studies are taught in Greek, there is a limited pool
of graduate students at the University; no Syrian, Chinese or
Iranian nationals will have access to the device. Othonos
will perform the installation and the primary users, in
addition to himself, will be his post-doctorate researchers
and his graduate students. The lab is secured by an alarm
system, with Othonos and his post-doctorate assistants having
the alarm code. Othonos has a key to the lab and his
post-doctorate researchers had to get a key from him to
access the lab. Graduate students cannot be left in the lab
alone, either Othonos or his post-doctorate researchers must
be present.


3. (SBU) Othonos provided copies of Greek-language
paperwork concerning the iStar camera, which were from the
University's tender board. The University had opened a
tender for the device, which Laserlabs had been awarded
Othonos did not have the order paperwork for the device,
since Laserlabs had these documents. He explained how the
tender process worked at the University, and that the iStar
camera was purchased with funds set aside by the Republic of
Cyprus to comply with the European Union mandate for member
states to reserve funding for academic research. At the
conclusion of the site visit, PolOff ensured Othonos
understood the restrictions on the use of items on the U.S.
Munitions List and which were covered by the Arms Control
Export Act. PolOff highlighted the need for Othonos
(University) to obtain USG authorization for any proposed
transfer or re-export of the fiber optic coupler; Othonos
understood his obligations.


4. (C) On 31 August, PolOff traveled to Limassol (22 Amathus
Ave) to meet with Theodoulou and obtain copies of the order
Laserlabs Ltd submitted for the iStar/image intensifier.
During the site surveys for the iStar, PolOff observed
nothing which would have given him pause in providing a
favorable recommendation. In subsequent contact with
Theodoulou on 07 and 11 September, Theodoulou told PolOff
that Andor had decided not to wait for a U.S. export license.
Theodoulou did not know about the change until he received
the complete iStar camera with fiber optic coupler in early
September. Following receipt, he contacted the company to
ask how the camera could have been sent to him without the
U.S. export license. Andor advised Theodoulou it did not
want to wait for the U.S. license and a suitable Chinese
substitute had been found which allowed them to send the

NICOSIA 00000760 002 OF 002


complete device to Theodoulou. Post discovered nothing which
would have led us to believe that the iStar camera and fiber
optic coupler would be used in a manner inconsistent with the
stated end use. We do find the late change by Andor
interesting and note that Theodoulou was denied an export
license for the Reftel B order. While we have no information
which would indicate that Theodoulou was behind the switch to
a Chinese fiber optic coupler to avoid another possible U.S.
export license denial, we wish to highlight that this is
within the realm of possibility.
SCHLICHER