MALAYSIAN-BASED IRANIAN FRONT COMPANY SEEKS TO

S E C R E T STATE 130917 SIPDIS E.O. 12958: DECL: 12/24/2034 TAGS: MTCRE PARM PREL MNUC ETTC KSCA IR CH MY SUBJECT: MALAYSIAN-BASED IRANIAN FRONT COMPANY SEEKS TO PURCHASE EXPORT-CONTROLLED GYROSCOPES FROM CHINESE FIRM (S) Classified By: ISN/MTR DIRECTOR PAM DURHAM FOR REASON 1.4 (C). ¶1. (U) This is an action request. Embassy Beijing, please see paragraph 3. ¶2. (S) Background/Objective: The United States has information indicating that in late November 2009, the Malaysian firm Electronic Component Limited (ECL) attempted to buy five TRS-500 gyroscopes from the Chinese firm VibTel Industrial Co. Inc. These gyroscopes can be used in the guidance systems of ballistic missiles, cruise missiles, and unmanned aerial vehicles, and are controlled by the Missile Technology Control Regime (MTCR),the Wassenaar Arrangement, and China's own missile-related export controls. Although ECL is located in Malaysia, it is part of an Iranian-controlled network of front companies that Iran uses to procure sensitive items on behalf of entities of proliferation concern. We are therefore concerned that if VibTel were to ship these gyroscopes to Malaysia, ECL would subsequently forward them to Iran, the location of the actual end-user. We want to alert Chinese officials to this information and encourage them to take measures to prevent VibTel from acting as a supplier to ECL and affiliated firms. ¶3. (S) Action Request: Request Embassy Beijing approach appropriate host government officials 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 CHINA) --We would like to alert you to information of proliferation concern and request your government's assistance in investigating this activity. --The U.S. has information indicating that in November 2009, the Malaysia-based firm Electronics Component Limited (ECL) attempted to buy five 3-axis model TRS-500 gyroscopes from the Chinese firm VibTel Industrial Co. Inc. --TRS-500 gyroscopes are controlled by the Missile Technology Control Regime (MTCR) and the Wassenaar Arrangement, as well as by China's own missile-related export controls, and can be used in the guidance systems of ballistic missiles, cruise missiles, and unmanned aerial vehicles. --Although ECL is located in Malaysia, it is actually part of a network of Iranian-controlled front companies that procure sensitive goods on behalf of a number of Iranian entities of proliferation concern. --It is therefore likely that if this equipment were to be shipped to ECL in Malaysia, it would be subsequently diverted to Iran, where the actual end-user is located. --According to its website (www.vibtel.com),VibTel Industrial Co. Inc. is located at 308, BaiHuaYuan Business-Building, No. 11, ZhongGuanCun Nan Da Jie, HaiDian District, Beijing, 100081, China. --We urge you to take all appropriate measures to prevent VibTel Industrial Co. Inc. from supplying this equipment to ECL or other affiliated firms. --We appreciate your cooperation on nonproliferation matters and look forward to hearing to hearing the results of your investigation. End talking points/non-paper ¶5. (U) Washington POC is ISN/MTR John Paul Herrmann (Phone: 202-647-1430). Please slug any reporting on this issue for ISN/MTR and EAP/CM. ¶6. (U) A word version of this document will be posted at www.state.sgov.gov/demarche. CLINTON