EXTRANCHECK: POST SHIPMENT VERIFICATION: FLEX-IN

UNCLAS HONG KONG 001047

USDOC FOR 532/OEA/MHAMES/MCANNER
USDOC FOR 3132 FOR FCS/OIO REGIONAL DIRECTOR PATRICK SANTILLO
BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS

SIPDIS

E.O. 12958: N/A
TAGS: BMGT BEXP HK ETRD ETTC
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION: FLEX-IN
ELECTRONICS LIMITED

REF: A) BIS e-mail request dated May 15, 2009


1. Unauthorized disclosure of the information provided below is
prohibited by Section 12C of the Export Administration Act.


2. As per reftel A request and at the direction of the Office of
Enforcement Analysis (OEA) of the USDOC Bureau of Industry and
Security (BIS),Export Control Officer Philip Ankel (ECO) conducted
a post-shipment verification (PSV) at Flex-In Electronics Limited,
Flat 204-205, 2F, Laford Centre, 838 Lai Chi Kok Road, Hong Kong
(Flex-In). The items in question for this PSV re three shipments of
logic arrays and integrate circuits exported to Flex-In on or about
May 24, 2008 (shipment one),November 18, 2008 (shipment 2, arch
10, 2009 (shipment 3). These items are lassified under export
control classification nuber (ECCN) 3A001 and are controlled for
nationalsecurity (NS) reasons. The exporter was Lattie
Semiconductor of Hillsboro, Oregon.


3. According to the Hong Kong Companies Registry, Flex-In was
registered in 2001 and has the Hong Kong equivalent of USD 1300 in
paid up share capital. Flex-In's directors are listed as Hong Kong
residents Chong, Man Sui (HK ID C368535(5)) and Shen, Hing Steven
(HK ID E781805(1)).


4. Web based research reveals that Flex-In
(www.fe-electronics.com)is part of the Dragon Group of companies.
The Dragon Group of companies is owned and controlled by ASTI
Holdings Limited (www.astigp.com),a Singapore stock exchange listed
company. ASTI's companies include electronics distribution
companies (including those in the Dragon Group) as well as
semiconductor equipment manufacturing companies. The group employs
over 2900 employees worldwide.


5. On June 4, 2009, ECO and Commercial Assistant Carrie Chan
visited the company and met with Dragon Technology Distribution (HK)
Limited's Finance Manager, Ms. Shirley Kam. She provided an
overview of the corporate structure of the various ASTI and Dragon
companies. She further clarified that Flex-In serves primarily
Korean customers. Flex-In's customers are primarily manufacturers
in the mobile telecom market and Flex-In rarely sells to other
resellers. Ms. Kam was familiar with Hong Kong and U.S. export
licensing rules.


6. Ms. Kam was open and forthcoming and provided documentation
confirming the final disposition of all three shipments. Each of
those shipments was reexported by Flex-In to Samsung Electronics for
use in mobile phone production.


7. Based on the information noted above, ECO believes Flex-In to be
a suitable recipient of controlled U.S. origin technology.