(U) PROVIDING THE FRG WITH ADDITIONAL INFORMATION

S E C R E T STATE 029412 SIPDIS E.O. 12958: DECL: 03/20/2033 TAGS: PARM PREL ETTC MTCRE KSCA GM IR AE SUBJECT: (U) PROVIDING THE FRG WITH ADDITIONAL INFORMATION ON IRANIAN MISSILE PROGRAM'S EFFORTS TO PROCURE GERMAN TEST AND MEASUREMENT EQUIPMENT REF: A. 07 STATE 074940 ¶B. 07 BERLIN 001138 ¶C. 07 BERLIN 001733 ¶D. 07 STATE 146193 ¶E. BERLIN 000135 ¶F. PETERSEN-HERRMANN E-MAIL Classified By: ISN/MTR OFFICE DIRECTOR PAM DURHAM FOR REASON 1.4 (B),(D). ¶1. (U) This is an action request. Please see paragraph 8. ¶2. (S) Background: In June 2007 we advised German officials that as of late April 2007, an entity affiliated with the Shahid Hemmat Industrial Group (SHIG - Iran's leading developer of liquid-propellant ballistic missiles) was seeking test and measurement equipment manufactured by the German-based firm Rohde & Schwarz via a United Arab Emirates (UAE)-based intermediary (Refs A & B). ¶3. (S) In September, German MFA officials told us that the Federal Economic and Export Licensing Agency (BAFA) could not identify any export that corresponded with the information we provided (Ref C). Nonetheless, BAFA approached Rohde & Schwarz to sensitize the firm to the issue. Rohde & Schwarz representatives indicated that they were currently not in contact with SHIG, nor had they ever done business previously with the organization. They also said they were unaware of any middleman in the UAE. (Note: German officials did say that in May 2006, Rohde & Schwarz had applied for a license to export a spectrum analyzer to Iran's Ministry of Information and Communication, but BAFA officials refused the request. We have no information suggesting a linkage with the current case. End note.) ¶4. (S) In October 2007, we provided the German government information indicating that as of late August, an agent for SHIG ordered a Rohde & Schwarz SMU200A signal generator from the same or a related UAE-based intermediary (Ref D). We also stressed that while Rohde & Schwarz advised German officials that it had never had any contact with SHIG, the Iranian missile entity often conducts its business through front companies and foreign based middlemen who could pose as end-users. ¶5. (S) In response to our October demarche, FRG officials advised us that the German Federal Office of Economics and Export Controls (BAFA) had contacted representatives of Rohde and Schwarz to sensitize them to the matter, but was unable to verify that the firm had been contacted by a UAE-based entity (Ref E). Our German interlocutors inquired about the possibility of sharing the names of possible intermediary firms acting on behalf of SHIG. BAFA officials plan to use the list to ask Rohde and Schwarz representatives to verify that the firm has not been contacted by the UAE intermediaries. Otherwise, according to German officials, it will be difficult under German law for BAFA to investigate the matter further. ¶6. (S) In a February 2008 meeting, German MFA officials reiterated to Embassy Berlin the German request for the names of specific UAE-based intermediaries involved in the procurement of a Rohde and Schwarz-manufactured signal generator (Ref F). The German government emphasized that it is not interested in knowing how such information was obtained, but simply would like to know who the entities are in order to facilitate its investigation. ¶7. (S) Objective: We now want to provide German officials with information identifying names that the UAE-based intermediary could be using in its efforts to procure Rohde & Schwarz equipment on behalf of Iran's ballistic missile program. (Note: We have not shared this information with the UAE. End note.) ¶8. (S) Action Request: Department requests Embassy Berlin approach appropriate host government officials to deliver the talking points in Paragraph 9 and report response. Talking points may be left as a non-paper. ¶9. (S) Begin talking points/non-paper: (SECRET//REL GERMANY) -- In the spirit of nonproliferation cooperation, we would like to provide your government with information it requested related to a matter of proliferation concern. -- In early June 2007, we shared with your government information indicating that as of late April 2007, an entity associated with Iran's primary liquid-propellant ballistic missile developer - the Shahid Hemmat Industrial Group (SHIG) - expressed interest in electronic test and measurement equipment manufactured by the German firm Rohde & Schwarz. -- The Iranian entity was seeking information on a number of Rohde & Schwarz items from a United Arab Emirates (UAE)- based intermediary. -- Among these items were a spectrum analyzer, tracking generators, signal generators, attenuators and related software. -- We subsequently advised you that in late August 2007, an agent for SHIG ordered a Rohde & Schwarz SMU200A signal generator from the same or a related UAE-based intermediary. -- In December, you requested the identity of the UAE entity involved in this activity. -- The UAE intermediary may be using one of the following names: -- Sanaei International Partners -- Hassan and Sanaei Trading Company LLC -- Akbar Mohd Qanat Besha LLC -- As we explained previously, we understand that the delivery of this equipment was scheduled to take place 4 to 6 weeks after placement of the order and receipt of an advance payment, which had been made as of late August. -- We do not know if the equipment has been delivered yet, nor do we know if Rohde & Schwarz is aware of the Iranian interest in its products, but would expect that any export of this equipment would require an export license. -- We hope this information is useful to your export licensing review, and urge you to scrutinize any export request submitted by Rohde & Schwarz destined for either Iran or the UAE. -- We look forward to continuing cooperation with your government on nonproliferation issues and would appreciate hearing the results of your inquiries. End talking points/non-paper. ¶10. (U) Please contact ISN/MTR's John Paul Herrmann with any questions or follow-up related to this case (202-647-1430 - herrmannjp2@state.gov or herrmannjp@state.sgov.gov) and slug reporting on this issue for ISN/MTR and EUR/PRA. ¶11. (U) A word version of this document will be posted at www.state.sgov.gov/demarche. RICE NNNN End Cable Text