UAE FIRM,S INTEREST IN CONTROLLED SWISS MACHINE

S E C R E T SECTION 01 OF 02 STATE 080523 SIPDIS E.O. 12958: DECL: 07/18/2033 TAGS: PARM MTCRE PREL IR AE SUBJECT: UAE FIRM,S INTEREST IN CONTROLLED SWISS MACHINE TOOLS ON BEHALF OF IRANIAN END-USER Classified By: ISN/MTR DIRECTOR PAM DURHAM REASONS 1.4 (B),(C) AND (D). ¶1. (U) This is an action request. Embassy Abu Dhabi, please see paragraph 3. ¶2. (S) Background/Objective: In early June 2008, the UAE firm Golden Triangle Testing Equipment L.L.C. expressed interest in procuring fifty g-Mill 550 Twin machine tools from the Swiss firm Liechti Engineering AG. In response, Liechti provided Golden Triangle with pricing information for a single g-Mill 550 Twin. It likely also sent a proforma invoice to Golden Triangle. We believe that this equipment is controlled by the Nuclear Suppliers Group and the Wassenaar Arrangement, and is well suited to manufacturing ballistic missile components. The provision of NSG-controlled items to Iran was prohibited in UNSCRs 1737 and 1803, except for exclusive use in light water reactors or, for dual use items, if necessary for IAEA technical cooperation. We also believe that the ultimate end-user is located in Iran, although the specific identity of this entity is not known. The sale to Iran of NSG or Wassenaar-controlled items could lead to the imposition of sanctions on Golden Triangle pursuant to the Iran, North Korea, and Syria Nonproliferation Act (INKSNA). In addition, paragraph 4 of UNSCR 1737 requires all states to prevent the transfer to Iran of any item a state determined would contribute to the development of a nuclear weapon delivery system. We want to urge the UAE to investigate this information and take all appropriate measures to prevent this transfer and to ensure that Golden Triangle is not acting as a supplier of controlled goods to Iranian end-users. ¶3. (S) Action Request: Request Embassy Abu Dhabi approach appropriate UAE authorities to deliver talking points/non-paper in paragraph 4 below and report response. Talking points also may be provided as a non-paper. ¶4. (S) Begin talking points/non-paper: (SECRET//REL UNITED ARAB EMIRATES) -- In the spirit of our counterproliferation task force dialogue, we would like to raise with you a matter of serious proliferation concern and request your government's assistance in investigating this activity. -- We understand that in early June 2008, the UAE firm Golden Triangle Testing Equipment L.L.C. expressed interest in procuring fifty g-Mill 550 Twin machine tools from the Swiss firm Liechti Engineering AG. -- Liechti responded to this request by providing Golden Triangle with pricing information for a single g-Mill 550 Twin, and likely sent a proforma invoice to Golden Triangle at a later date. -- Our information also indicates that the ultimate end-user is located in Iran, although the specific identity of this entity is unknown. -- The g-Mill 550 Twin is controlled by the Nuclear Suppliers Group (NSG) and the Wassenaar Arrangement, and is well-suited to manufacturing ballistic missile components such as impellers and turbine blades. -- The provision of NSG-controlled items to Iran was prohibited in UNSCRs 1737 and 1803, except for exclusive use in light water reactors or, for dual use items, if necessary for IAEA technical cooperation. -- Because this item is controlled by the Wassenaar Arrangement and the NSG, we believe the transfer, if it were to occur, would be a violation of your export control laws. -- Golden Triangle's role in any transfer to Iran of NSG or Wassenaar-controlled items could lead to the imposition of sanctions pursuant to the Iran, North Korea, and Syria Nonproliferation Act (INKSNA). -- In addition, paragraph 4 of UNSCR 1737 requires all states to prevent the transfer to Iran of any item a state determined would contribute to the development of a nuclear weapon delivery system. -- We urge you to investigate this information and take all STATE 00080523 002 OF 002 appropriate measures to prevent this transfer and to ensure that Golden Triangle is not acting as a supplier of controlled goods to Iranian end-users. -- We look forward to hearing of any actions your government takes in response to this information. End talking points/non-paper. ¶5. (U) Please contact ISN/MTR's John Paul Herrmann with any questions or follow-up issues related to this case (202-647-1430 - herrmannjp@state.sgov.gov) and slug reporting on this issue for ISN/MTR. ¶6. (U) A word version file of this document will be posted at www.state.sgov.gov/demarche. RICE