GOI PUSHES BACK ON AIR TRAFFIC CONTROL SALE TO IRAN

S E C R E T ROME 000092

SIPDIS

SIPDIS
NOFORN

E.O. 12958: DECL: 12/29/2021
TAGS: ETTC PARM PREL IR IT
SUBJECT: GOI PUSHES BACK ON AIR TRAFFIC CONTROL SALE TO IRAN

REF: A. STATE 194199

B. ROME 3295

C. 2004 ROME 2829

D. 2004 ROME 1591

Classified By: Ecmin Thomas L. Delare for reasons 1.4 (b) and (d)


1. (S) Summary. Econ Counselor recently discussed with the
MFA's Arms Material Authorization Unit the canceled sale by a
Finmeccanica subsidiary of air traffic control (ATC) radar to
Iran (ref A) in an effort to enhance GOI understanding of
U.S. export control views of dual-use exports to Iran. Our
contact was adamant in asserting that the civilian radar in
question is "not covered by dual-use lists," and that the
export of ATC radar to Iran would have been legal under
Italian law had Finmeccanica chosen to go forward with the
sale. End Summary.


2. (S) Econ Counselor met December 13 with Carlo Tripepi,
Director of the MFA's Arms Material Authorization Unit,
responsible for licensing Italian munitions exports, and
former Director of the MFA office responsible for Italy's
participation in the Wassenaar Arrangement. Tripepi compared
the proposed ATC export to the USG export license granted to
General Electric for the export of engine parts to be
installed on aircraft engines used by Iran Air, Tripepi said
both exports would have a positive impact on the safety of
civil aviation in Iran. "People can die as a result of
inadequate air traffic control, just as they can die from
engine malfunctions." Tripepi recalled that in 1985, the USG
objected to a proposed contract between Selenia (another
Finmeccanica subsidiary) and the then-Soviet government for
the maintenance of radar systems used at Moscow's
Sheremetyevo Airport. According to Tripepi, USG was
concerned the radar units could be linked together to provide
"military grade" radar coverage. Tripepi recalled that after
much debate, the contract was allowed to go forward, and made
clear his "personal opinion" that the proposed ATC export to
Iran should also be allowed to proceed. In any event,
Tripepi said, Finmeccanica will not go forward with the
export because of its interest in sales to the USG.


3. (S) In response to Tripepi's assertion that the ATC radar
in question are not covered by the Wassenaar Arrangement and
that their export to Iran is legal under Italian law, Econ
Counselor asked if there is any flexibility in Italian export
control regulations to allow the GOI to act otside the
various multilateral export control regimes. Tripepi replied
by citing the GOI's "success" in 2005 in stopping the export
of fast boats to Iran as evidence of the flexibility of
Italian export control laws. In the case of the fast boats,
Tripepi said, the GOI was able to invoke "national security"
to "stop the boats' export." He further noted that "we can't
do this all the time," but argued that in extreme
circumstances, the GOI has the ability to block the export of
goods not specifically included in the multilateral regimes.
In a subsequent meeting with Enrico Padula, one of Tripepi's
subordinates, Econoff learned that Italian regulations give
the GOI wide discretion to block exports for nonproliferation
reasons. Padula added that the catch-all is interpreted
narrowly by the GOI, possibly to avoid litigation due to
denied export licenses.


4. (S) Comment. We recall the fast boats episode quite
differently than Tripepi does. Specifically, as reported ref
D, while the GOI agreed to stop the export of the very last
of twelve fast boats intended for Iran, it did so only after
exhaustive USG efforts and months of GOI foot-dragging,
during which the initial eleven boats were shipped.
Furthermore, it is clear to us that whatever progress was
made on the fast boats issue was made possible by the
cooperation of officials at the then-Ministry of Productive
Activities (now the Ministry of Foreign Trade) who have since
been reassigned. Italian exports of fast boats, marine
diesel engines (ref B),and ATC systems to Iran all
illustrate a growing disconnect between the USG and GOI on
the important issue of dual-use export controls and highlight
the need to restart bilateral export control consultations,
last held in 2004 (ref C). End comment.


SPOGLI