BLUE LANTERN BROKER INQUIRY ON MICHAEL MITCHELL,

UNCLAS BRUSSELS 001383 SIPDIS STATE FOR EUR/WE AND PM/DTCC: RJOUBERT-LIN E.O. 12958: N/A TAGS: ETTC KOMC BE SUBJECT: BLUE LANTERN BROKER INQUIRY ON MICHAEL MITCHELL, CASE NO. K-0673. REF: SECSTATE 94215 ¶1. (U) Summary: Pursuant to reftel request, Poloff and polintern met with Michael Mitchell, President of Aero Systems, SA, on October 5, 2009. Poloff and polintern conducted requested inquiry of Mitchell's brokering activities as well as a site visit to assess the business operations of Aero Systems. Post confirms that Aero Systems SA is in business at the location indicated reftel under its own name. Aero Systems assists its clients in selling military aircraft and associated equipment from American and British companies to the Belgian government. Mitchell considers himself a consultant rather than a broker and he does not take title to items sold to the Belgian military. Mitchell informed poloffs that the business originally assisted with the buying and selling of aircraft and has evolved over time to include both the sale of aircraft and support services. Mitchell's U.S.-based clients provide both aircraft and support services, while it United Kingdom-based clients provide only support services. End Summary. ¶2. (U) Aero Systems possesses a standard business license from the Belgian government. According to the Belgian government, neither Mitchell nor Aero Systems is otherwise licensed to sell or broker military items. Mitchell explained that as a consultant he is not required to have such a license. He said that he obtained registration with the U.S. Department of State as an arms broker at the request of the companies with which he works. ¶3. (U) Mitchell emphasized that Aero Systems does not store products for clients. The company never takes title of the products being sold. He insisted that Aero Systems is primarily a consulting company. Mitchell said that the companies he works with have the capability to store their products. ¶4. (U) Aero Systems was established in 1969 by Mitchell's father, a former serviceman in the Royal Air Force of the United Kingdom. Aero Systems has remained a family run business. Mr. Mitchell and his son are the company's principals. The company runs a relatively small operation consisting of four employees. ¶5. (U) Aero Systems is essentially a consultant to large companies such as Raytheon, Derco Aerospace, Northrop Grumman, and Lockheed Martin, who seek to sell aircraft and services to the Belgian military. It assists its clients in preparing proposals for offsets associated with sales of aircraft. End users in Belgium are the Belgian military, Sabena Technics, Sonaca, and Sabena World Airlines, all of which are Belgium based. ¶6. (U) Mitchell said that he and his company understand the restrictions on USML items, including those relating to unauthorized re-transfers and re-exports. He did not request any further clarification of the restrictions. GUTMAN