EXTRANCHECK: POST SHIPMENT VERIFICATION: HONG KONG NOVIKY

UNCLAS HONG KONG 002085

USDOC FOR 532/OEA/ 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: HONG KONG NOVIKY
ELECTRONICS

REF: A) BIS e-mail request dated October 13, 2009 (01210075)

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 Noviky Electronics, Unit
1502-3, 15/F, Leadr Industrial Centre, 57-59 Au Pui Wan Street,
Shatin, Hong Kong (Noviky). The items in question for this PSV are
two shipments of civil aircraft parts exported to Noviky on or about
September 28, 2007 and March 25, 2008. These items are likely
classified under Export Control Classification Number (ECCN) 9A991,
meaning that they are controlled for anti-terrorism reasons and
would require a license to sanctioned destinations and certain
restricted end-uses/users. The exporter is Aircraft Spruce
Specialty of Corona, California.


3. According to the Hong Kong Companies Registry, Noviky has been
in existence since March 2006. Its paid up share capital is the
Hong Kong equivalent of USD 65,000. The Hong Kong Companies
Registry lists mainland Chinese national Zhao, Sheng Hui as the sole
director. The registered address of Noviky appears to be the
registered address of another company that is the subject of a
pending end use check, namely J&T Electronics.


4. According to the company's web site (www.Noviky.com),Noviky is
a trading company that specializes in electronic components for the
aerospace, communication, electronic instrument and other sectors.



5. It took some time to arrange a visit to Noviky. The contact
person at the company stated that she was the only person running
the company and that she was due to go on maternity leave. She also
claimed to have lost the documentation related to the shipment in
question. Eventually, she agreed to meet.


6. On November 9, 2009, ECO and FCS Commercial Assistant Carrie
Chan visited the company at the address noted above and met with Ms.
Wong (there was no signage to indicate that Noviky is located at
this address). Noviky appears to be collocated with another
company, Armitech Electronics (more information at
www.armitechhk.com although this web site lists a different
address). Even for this jaded ECO, the meeting was remarkable. The
office of the company included only a desk and several chairs. It
did not include any computer, phone or filing cabinets. When asked
to describe Noviky's customers, Ms. Wong stated that they were
located in Hong Kong. When asked again about Noviky's customers,
Ms. Wong stated that they were manufacturers and trading companies
in Hong Kong. She provided no further details. When asked about the
warehouse referenced in the company's web site, Ms. Wong stated that
the company no longer has a warehouse. When asked why the meeting
was held in the Leadr Center (vice the ship to address),Ms. Wong
stated that the company had recently moved. When asked about the
transactions in question, Ms. Wong stated that she could not recall
(although she did not deny that they had taken place). When asked
whether she had any documentation regarding the order, Ms. Wong
stated that she did not. When asked whether she retains any
records, Ms. Wong stated that she did not. She stated that all of
her orders were done verbally. When asked why the office did not
contain a computer, phone or fax machine, Ms. Wong stated that she
visited her customers in person or they called her on her cell phone
or came to her office.


7. When asked for an e-mail address to which ECO could send export
control information, Ms. Wong stated that she did not have an e-mail
address. When ECO asked whether the e-mail on the Noviky web site
was operational, Ms. Wong stated that it was not. When asked about
the phone numbers on the web site, Ms. Wong stated she did not know
whether they were operational and that she had used numbers provided
by the web page design group that had helped her create the web
site. When asked about the director of the company, Ms. Wong stated
that he was a friend and allowed her to use his company for her
activities. She stated that he was unfamiliar with her activities
on behalf of Noviky. When asked for a business card, Ms. Wong
stated that she did not have one. When asked to write her name on
ECO's business card, Ms. Wong wrote her name as May Wong. ECO
cannot, with any degree of certainty, be sure the person he met with
is named Wong or May.


8. ECO later visited the ship-to address for the shipments in
question. This office (14/F Yue Choeng Centre, 1-3 Wong Chuk Yeung
St. Fotan, Hong Kong) is presently occupied by Interine Electronics
Pan Asia Co., Limited. This company has been in existence since
2000 and has the HK dollar equivalent of USD 125,000 in share
capital. A cursory review of SED data suggests that this company
has received shipments from the United States including national


security (NS) controlled electronic components classified under ECCN
3A001.


9. ECO believes Noviky to be a most unsuitable recipient of U.S.
origin technology. In ECO's opinion, Ms. Wong is aware of export
control restrictions on trade with sanctioned countries as evidenced
by her evasive answers. ECO recommends a close review of all
shipments to Noviky (and its address) as well as a review of
shipments to Interine Electronics Pan Asia Co., Limited and Armitech
and their corresponding addresses.