MTAG: TAIWAN EXCON (RETRANS FROM 2/14)

S E C R E T SECTION 01 OF 02 TAIPEI 000422

SIPDIS

SIPDIS

STATE FOR EAP/TC AND ISN/MTR

E.O. 12958: DECL: 02/16/2027
TAGS: ETTC PARM KNNP NK TW
SUBJECT: MTAG: TAIWAN EXCON (RETRANS FROM 2/14)

REF: A. STATE 17104

B. STATE 17021

C. TAIPEI 307

D. TAIPEI 129

E. 06 TAIPEI 685

F. SEOUL 414

G. TOKYO 655

Classified By: AIT Econ Chief Daniel K. Moore, 1.4 B/C


1. (S) Summary: AIT Econ delivered ref A export license
recommendations to Bureau of Foreign Trade (BOFT) export
control task force head Wally Su (Shi-hwa) on February 13.
During the meeting, Su noted a problem with the scheduled
dates for the next EXBS training (ref B) and asked if the
training could be postponed until March 20-22. Su said that
earlier on February 13 BOFT had issued the press release
referred to in ref C. He also described Taiwan's
participation in a recent international export control
seminar in Tokyo. AIT continued to press Taiwan to ban the
export of luxury items to North Korea. End summary.

Taiwan Invited to Attend WCO Meeting on SAFE
--------------


2. (S) In response to ref B proposal to conduct an EXBS
training workshop in Taipei on March 13-15, BOFT's Wally Su
explained that he had been instructed to attend a World
Customs Organization (WCO) conference on SAFE in Brussels on
March 12-14 that would discuss the link between the WCO SAFE
Framework of Standards to Secure and Facilitate Global Trade
and the Revised Kyoto Convention. Su said the invitation had
been transmitted from the WCO in Brussels to the Taiwan
(Chinese Taipei) WTO representative in Geneva. (Note: Taiwan
is not a member of the WCO and previously has not been
allowed to attend WCO meetings. AIT is unsure if this
invitation was sent by mistake or is something arranged by
U.S. agencies in response to Taiwan requests for assistance
in participating in SAFE (ref D). In either case, it will be
a breakthrough if a Taiwan representative is actually allowed
to participate in a WCO meeting. End note.) Su suggested
the EXBS training be re-scheduled for March 20-22. He also
again asked why the "Risk Targeting" course had been replaced
by the "PLC/PVS" course without
prior consultation.

BOFT Makes Public Warning to Local Companies
--------------


3. (S) During the meeting, Su said that a BOFT press release
on export control violations (mentioned in ref C) had been
issued at a press conference earlier on February 13. The
press release is posted on the BOFT website at
http://cweb.trade.gov.tw/. Local and international media
described the press conference as warning local companies of
the penalties for failure to comply with new regulations on
exports to North Korea and Iran and quoted BOFT Deputy
Director General James Wu as saying "We have had a few cases
recently where customs officials have caught sensitive
products that were to be exported, and told the companies
that they needed to gain permission to export such items to
these countries. None of those items got past customs." Su
said that BOFT was planning to hold another 3-5 outreach
events for industry in coming weeks and this time would
instruct companies to send high-level officials so they could
not use the excuse that upper levels of company management
had not heard of the new export license requirements.

Review Panel Upholds Suspension, Rejects Company Protest
-------------- --------------


4. (S) BOFT Wally Su explained that over the past six months
Taiwan Customs had stopped nine separate shipments (in ref C

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he told us there were 11 shipments) of items on the Sensitive
Commodities List (SCL) bound for Iran or
North Korea because the shipments lacked an export license.
BOFT had done a preliminary investigation of
these cases, and then forwarded them to the Ministry of
Justice Investigation Bureau (MJIB) for further
investigation and legal action. Su said BOFT had
administratively penalized each of the companies involved
with a one month suspension of their exporting privileges.
One company formally protested the suspension and claimed
that no violation had occurred since items were stopped
before they were exported. A review panel consisting of
officials, lawyers, and industry association representatives
in early February upheld the BOFT decision to suspend export
privileges.

MJIB Conducts Another Disappointing Investigation
-------------- --------------


5. (S) Su said BOFT had received the first investigation
result from MJIB on these nine cases on February 12. The
MJIB investigation result consisted of a brief very statement
that MJIB had contacted the shipping agent and
customs broker in the case and had determined that the
failure to apply for an export license was "unintentional"
and therefore the case would not/not be forwarded to the
Prosecutors' Office for further action. Su said he was
disappointed in the MJIB response, and unsure what MJIB meant
in saying the violation was "unintentional." He said he
would keep AIT informed of further MJIB investigation results.

Taiwan Again Participates in Japan's Annual Excon Seminar
-------------- --------------


6. (S) Su told AIT that three Taiwan officials had
participated in a February 6-8 export control seminar in
Tokyo attended by over 100 delegates from 25 countries (ref
F). Su said BOFT's presentation on its export license
"cross-checking" arrangement with the United States (aka: the
gameplan) evoked much interest from South Asian countries.
Su also noted that the PRC had replaced the "wooden" official
it sent last year who refused to answer any questions (ref E)
with two personable young women.

Banning Luxury Exports to North Korea
--------------


7. (S) AIT again urged that Taiwan ban the export of luxury
items to North Korea and presented the information from ref F
regarding luxury items that Singapore has banned from
exporting to North Korea. Su said he would contact Singapore
officials for more details of what its ban entailed and that
he would continue pushing for such a ban by Taiwan.
YOUNG