UKRAINE: RESPONSE TO BLUE LANTERN PRE-LICENSE END-USE CHECK

UNCLAS KYIV 001353 SIPDIS STATE FOR PM/DTCC - BLUE LANTERN COORDINATOR E.O. 12958: N/A TAGS: ETTC KOMC UP SUBJECT: UKRAINE: RESPONSE TO BLUE LANTERN PRE-LICENSE END-USE CHECK ON LICENSE 05-050103848: AVIANT/ANTONOV REF: A) Sabatini-Habinowski email of 7/9/08 B) State 62235 ¶1. This is a reply to a Blue Lantern action request (ref B). ¶2. Post was requested to conduct a pre-license check on DDTC license application number 05-050103848 for the export of power modules to Ukraine via Russia (applicant: International Rectifier Corporation, 233 Kansas Street, El Segundo, CA). The foreign consignee is Aviant State Aviation Plant ("Aviant"),100/1 Pobedy Prospekt, Kyiv. The end-user is Aeronautical Scientific Technical Complex Antonov ("Antonov"),1 Tupolev Street, Kyiv. ¶3. Economic Officer Matthew Habinowski (U.S. citizen) and FSN Economic Specialist Oksana Sukhina (Ukrainian national) met with Nikolay Vorobyov, Deputy Chief Designer of the AN-70 at Antonov, on July 10, 2008 at the U.S. Embassy to conduct a pre-license check. (Note: Post met with Vorobyov at the Embassy because GOU bureaucratic procedures to meet with foreign officials in GOU buildings can take weeks. Antonov is a well-known company with established relations with the USG, and we did not need to establish its bona fides by visiting its facilities. End note.) Vorobyov's contact telephone number is 380.44.400.2576. His email address is vorobyov(at)antonov.com. ¶4. Vorobyov's description of the transaction differed slightly from the sequence described in reftels. He told us that Russian company Aeroelectromash would install the components into the PTS-15 static converter and forward the item directly to Antonov. This particular converter would not/not go to Aviant, but Vorobyov noted that he anticipated that Aviant would be placing an order of "no less than two" of the converters later this year for mass production of AN-70 planes. He surmised this was why they might have been included on this license application. ¶5. Upon receipt of the converter, Vorobyov explained, Antonov would conduct limited testing -- a majority of the testing would have been done in Russia by Aeroelectromash -- and then install the converter into an AN-70 aircraft. When Econoff inquired about the end-user of the aircraft, Vorobyov said that Antonov had no existing sales contract, but was hoping to sell the plane to either the Ukrainian Ministry of Defense (MOD) or the Ukrainian Aviation Transportation Company, a state enterprise owned by the MOD. Antonov, Vorobyov asserted, had no plans to sell the aircraft to a foreign buyer. ¶6. Vorobyov demonstrated a general familiarity of export controls, but was unaware of the specifics of the U.S. Munitions List (USML). Econoff explained the contents of the USML, the administration of export control on USML commodities, and the prohibition against re-export without USG authorization. To the latter, Vorobyov reiterated that Antonov only plans to sell the aircraft to domestic customers. ¶7. Antonov is a large, bureaucratic state-owned enterprise and, as is typical in former Soviet countries, decision-making requires numerous approvals. Although the USG already has an established relationship with Antonov in other areas, it took Post several weeks to track down the appropriate official to answer to ref B questions. Once identified, however, Vorobyov responded quickly to Post's meeting request and answered all questions openly. Post recommends Antonov as an acceptable recipient of U.S.-origin commodities. Taylor