BLUE LANTERN LEVEL 3: POST-SHIPMENT END-USE CHECK

UNCLAS STATE 061457

SIPDIS
OTTAWA FOR LORI BALBI

E.O. 12958: N/A
TAGS: ETTC KOMC CA
SUBJECT: BLUE LANTERN LEVEL 3: POST-SHIPMENT END-USE CHECK
ON THE EXPORT OF U.S. DEFENSE ARTICLES CITING THE CANADIAN
EXEMPTION

REF: 2006 BLUE LANTERN GUIDEBOOK


1. This is an Action Request. See paragraphs 2-4.


2. The Department's Office of Defense Trade Controls
Compliance (PM/DTCC) requests Embassy's assistance in
conducting a post-shipment check on transactions citing the
Canadian exemption (part 126.5 of the International Traffic
in Arms Regulations - ITAR) for the export of electronic
component parts to Canada. EMBASSY is requested to complete
this Blue Lantern check within 45 days. Lack of response to
a Blue Lantern check will affect pending and future licenses
involving parties to this license.


3. Reason for request: end-user Ensil International appears
on the DTCC Watchlist; also vague/incomplete description of
commodity and end-use in export filing; the Automated Export
System (AES) filing data indicates exports of electronic
component parts while the United States Munitions List (USML)
category cited indicates aircraft and/or related component
parts. The company has not previously been the subject of a
Blue Lantern.


4. ACTION OTTAWA: Mission Canada is requested to make
inquiries with appropriate officials to establish the bona
fides of end-user Ensil International and to obtain all
relevant details of the export of electronic component parts
to Canada citing the Canadian exemption, including the exact
description, number, type, dollar value, and serial number of
items. PM/DTCC also requests that post conducts a site visit
to the company in order to provide Department with an
assessment of its business operations and on-site security.
Finally, post is asked to assess whether the company appears
to be a reliable recipient of USML items. If a site visit is
not possible, please inform the PM/DTCC officer.

The following questions are provided as suggested guidance:

--What were the exact USML articles exported to you?

--What is the exact end-use for these USML items? Will Ensil
International retain positive control over the electronic
component parts at all times? Will they be transferred to
other end-users in Canada or re-exported?

--Does the company have secure facilities and proper
accounting and security procedures for handling sensitive
USML items?

--When was the company established and who are its
principals?

--What is the nature of the company's business? Have they
previously sought defense articles on the USML?

--What type of organizations are among its typical customers
and where are the customers located?

--Does the company understand the restrictions on USML items,
especially the prohibition against unauthorized re-transfer
and re-export?

END ACTION.


5. Details of the AES filings:

--EXPORT 1 - QUANTITY/COMMODITY:

Quantity not provided

Commodity - P/N:RVGTAYSA251A Resistor

Stated Value: USD 400.00

Export Date - 16 October 2007

ITAR Exemption Number - 126.5B

Filer Identification Number - 52082586

Shipping Reference Number - INV126857

Export Identification Code - 52068258600

--EXPORT 2 - QUANTITY/COMMODITY:

Quantity not provided

Commodity - P/N:7893459-001 Cable, Radio

Stated Value: USD 75.00

Export Date - 16 October 2007

ITAR Exemption Number - 126.5B

Filer Identification Number - 52082586

Shipping Reference Number - INV126857

Export Identification Code - 52068258600

U.S. EXPORTER:

Associated Aircraft Manufacturing
784 NW 57th Court
Fort Lauderdale, FL 33309
POC is Bergevin, Tel. 954-772-6606

ULTIMATE CONSIGNEE

Ensil International
205 Torbay Rd.
Markham, Canada L3R3W4
POC is Bashari, Tel. 800-265-0009


6. Please slug reply for PM/DTCC - BLUE LANTERN COORDINATOR
and include the words "Blue Lantern" and the case number in
the subject line. PM/DTCC can fax documentation to post upon
request. POC is Tim Mazzarelli, Phone: 202-663-3867; Email:
MazzarelliTP@state.gov; SIPRNET: MazzarelliTP@state.sgov.gov.
The Blue Lantern Guidebook (ref) is available as a PDF file
in the Bunche Library's E-Book Collection on the DOS
Intranet: http://buncheelectroniclibrary.state.gov/eboo ks/
BlueLanternGuidebook2006%20 final .pdf


7. Department is grateful for post's assistance in this
matter.
CLINTON