BLUE LANTERN LEVEL 3: PRE-LICENSE END-USE CHECK

UNCLAS STATE 119551 SIPDIS MANILA FOR GIGI COFFIN E.O. 12958: N/A TAGS: ETTC KOMC RP SUBJECT: BLUE LANTERN LEVEL 3: PRE-LICENSE END-USE CHECK ON LICENSES 050200227 AND 050200228 ¶1. This is an Action Request. See paragraph 4. ¶2. The Department's Office of Defense Trade Controls Compliance (PM/DTCC) requests Post's assistance in conducting a pre-license check on licenses 050200227 and 050200228 for the export of rifles, magazines, and grenade launchers to the Philippines National Police (PNP). Post is requested to complete this Blue Lantern check within 30 days. Lack of response to a Blue Lantern check will affect pending and future licenses involving parties to this license. ¶3. Reason for Request: These licenses are for significant military equipment. Department seeks confirmation of the bona fides of these transactions and the parties involved. ¶4. Action Request: Post is requested to establish the bona fides of these transactions by making inquiries to the Philippines National Police (PNP). If necessary based on PNP responses, Post is requested to follow up with Ferfrans. The following points are included for guidance: (To PNP) --Can you confirm these orders for rifles, magazines, and grenade launchers? Please verify the exact quantities that you ordered. --How will these items be used by the PNP? Will they be transferred to any other entities within the Philippines Government? --Will Ferfrans Specialties ever have physical possession of these items? Who else may be handling these defense articles prior to delivery to PNP? --These two licenses have end-user's certificates issued by Philippines Government agencies. One is from the Directorate of Logistics and the other is from the Logistics Support Service. Can you please explain the difference between these two agencies and their functions? Do both agencies have authority to issue end-user certificates on behalf of the PNP? --Do you have any information on Ferfrans Specialties that would call in to question their reliability as a recipient of U.S. defense articles? (To Ferfrans, if necessary) --Please verify the exact quantities of these items ordered by the PNP. --Will Ferfrans Specialties ever have physical possession of these items? Who else may be handling these defense articles prior to delivery to PNP? Please describe your procedures of securing these items. --There is a discrepancy between the quantities ordered by the PNP and the quantities Ferfrans is seeking. Please explain this discrepancy. For what will the excess items be used? To whom will Ferfrans sell the excess items? In its reply, Post may also comment on any other information pertinent to these transactions such as security of facilities, end-use, and concerns about the entities involved. ¶5. Details of license applications: ¶A. DTC Case: 050200227 QUANTITY/COMMODITY: 550 Ferfrans SOAR-5.56 Rifles 200 Ferfrans HV LAR 5.56 Rifles 1,650 30 Round Magazines 700 90 Round Drum Magazines License Value: USD $560,000 SELLER: Ferfrans 2649 E. Valley Blvd, Suite D West Covina, CA 91792 FOREIGN CONSIGNEE: Ferfrans Specialties 200 Montebello Court, Banilad Cebu City Philippines Tel: 6332-233-2842 Email: francis@ferfrans.net FOREIGN END-USER: Philippines National Police Directorate for Logistics Camp Crame Quezon City Philippines PURPOSE: For use by anti-terrorist teams and commando units of the PNP. Shipped directly to Camp Crame. ¶B. DTC Case: 050200228 QUANTITY/COMMODITY: 110 Ferfrans DEFCOM XL200 40mm Rail-Mounted Grenade Launchers 1 Non-Firing Ferfrans DEFCOM XL200 40mm Rail-Mounted Grenade Launchers 100 40mm Cartridges License Value: USD $88,150 SELLER: Ferfrans 2649 E. Valley Blvd, Suite D West Covina, CA 91792 FOREIGN CONSIGNEE: Ferfrans Specialties 200 Montebello Court, Banilad Cebu City Philippines Tel: 6332-233-2842 Email: francis@ferfrans.net FOREIGN END-USER: Philippines National Police Directorate for Logistics Camp Crame Quezon City Philippines PURPOSE: For use by anti-terrorist teams and commando units of the PNP. Shipped directly to Camp Crame. ¶6. Submitted in support of the license application were the following documents (PM/DTCC will fax documentation to Posts upon request): ¶A. DSP-83 signed by Ferdinand Sy (Ferfrans U.S.) dated 11/09/2009; Jesus Ame Verzosa (PNP) dated 11/05/2009; Luizo Ticman (PNP, Logistics) dated 11/09/2009; and Alan Francis (Ferfrans Specialties) dated 11/07/2009 Import Authorization No. PI-F228-09 issued by National Headquarters, Philippines National Police signed by Jesus Ame Verzosa dated 11/05/2009 Purchase Order No. NOV09-05 from Ferfrans Specialties signed by Alan Francis dated 11/05/2009 End-User's Certificate issued by PNP Directorate of Logistics signed by Luizo Ticman dated 09/22/2009 ¶B. DSP-83 signed by Ferdinand Sy (Ferfrans U.S.) dated 11/09/2009; Jesus Ame Verzosa (PNP) dated 11/05/2009; Luizo Ticman (PNP, Logistics) dated 11/09/2009; and Alan Francis (Ferfrans Specialties) dated 11/07/2009 Import Authorization No. PI-F241-09 issued by National Headquarters, Philippines National Police signed by Jesus Ame Verzosa dated 11/05/2009 Purchase Order No. NOV09-09 from Ferfrans Specialties signed by Alan Francis dated 11/09/2009 End-User's Certificate issued by PNP Logistics Support Service signed by George Piano dated 09/30/2009 ¶7. Please slug reply for PM/DTCC - BLUE LANTERN COORDINATOR and include the words "Blue Lantern" and the case number in the subject line. POC is Kyle M. Ballard, Phone: 202-663-1929; Email: BallardKM@state.gov; SIPRNET: BallardKM@state.sgov.gov. The Blue Lantern Guidebook (ref) is available as a PDF file on Intellipedia: http://www.intelink.gov/wiki/ Blue Lantern End-Use Monitoring Program ¶8. Department is grateful for Post's assistance in this matter. CLINTON