RESPONDING TO GOI QUESTIONS ON IRANIAN EFFORTS TO

S E C R E T STATE 099410

SIPDIS

E.O. 12958: DECL: 09/23/2034
TAGS: MTCRE PARM PREL MNUC ETTC KSCA JA IR IT
SUBJECT: RESPONDING TO GOI QUESTIONS ON IRANIAN EFFORTS TO
PROCURE JAPANESE-ORIGIN SERVO-ACTUATORS FROM ITALIAN FIRM
(S)

REF: A. STATE 032269

B. TOKYO 000800

C. STATE 034798

D. ROME 000472

E. STATE 075985

F. ROME 000989

Classified By: ISN/MTR DIRECTOR PAM DURHAM FOR REASON 1.4 (C).


1. (U) This is an action request. Embassy Rome, please see
paragraph 6.


2. (S) Background: On April 2, 2009, we shared with the
government of Japan information indicating that in mid-
February 2009, Iran's Farazeh Equipment Distributor Company
(FEDCO) sought servo-actuators manufactured by the Japanese
firm Tonegawa-Seiko via the Italian firm Alpi Aviation (Ref
A). Japanese officials responded that Tonegawa-Seiko had in
fact exported a quantity of 200 PS050 servo actuators to Alpi
Aviation on February 25, 2009, and recommended that we
discuss
this issue with Rome (Ref B). (Note: FEDCO has previously
acted as a supplier for Iran's unmanned aerial vehicle (UAV)
and liquid-propellant ballistic missile programs. Although
the servo-actuators sought by FEDCO are not controlled, they
are suitable for use in UAV flight control systems. For
several years, we have discussed with Japanese officials
efforts by Iran's UAV program to procure Tonegawa-Seiko servo-
actuators from a variety of sources in numerous countries.
End note.)


3. (S) On April 9, we raised this activity with Italian
officials, who agreed to apply close scrutiny to any export
license application involving Alpi Aviation or FEDCO (Ref C).

GOI representatives also asked if the servo-actuators were
designated as prohibited items under any of the relevant
international agreements and/or whether their export could be
stopped under a "catch all" provision. Post informed Italian
officials that stopping the transfer pursuant to "catch alls"
would be appropriate given the likely end-user (Ref D).


4. (S) In July, we followed up on this case and requested an
update on the status of Italy's investigation (Ref E).
Italian officials advised that they had put Alpi Aviation
under surveillance for a period of three months and had
uncovered no evidence of suspicious exports - including of
the
servo-actuators - to Iran, and asked if the US wanted them to
continue monitoring Alpi Aviation. Italian officials also
asked for more specific information on the servo actuators,
including the following: their pertinent harmonized trade
system numbers; whether they are designated as arms or dual
use products; and whether they are specifically prohibited by
international export control arrangements (Ref F).


5. (S) Per Ref F, Post requested that Department provide
more
specific information on the servo-actuators, as well as
instructions on whether to formally ask the Italian MFA for
continued surveillance of Alpi Aviation.


6. (S) Action Request: Request Embassy Rome approach
appropriate host government officials and, drawing on the
information in paragraphs 1-4, provide the following
responses
to Italy's questions.


-- We want to inform Italian officials that we have not been
able to verify the harmonized trade numbers of the servo-
actuators, but these items are not controlled by any of the
multilateral export control regimes, and are not listed as
arms or dual use products.

-- However, in light of their clear UAV applications, past
efforts by Iran's UAV program to procure these items, and
FEDCO's affiliation with Iranian programs of proliferation
concern, we believe that Italy's use of catch-all controls to
prevent the export of these servo-actuators to Iran is
warranted.

-- In addition, while we would appreciate the continued
monitoring by Italian officials of Alpi Aviation, we also
want
to urge Italian officials to approach representatives of the
firm and sensitize them to the proliferation concerns the
U.S.
has raised - without identifying the U.S. as the source of
the
information.

-- Additionally, we would encourage GOI officials to inquire
with Alpi Aviation as to the disposition of the 200 PS050
servo-actuators that the Japanese government confirmed have
been exported to Alpi Aviation by Tonegawa-Seiko (i.e., are
the servos still in possession of Alpi Aviation, and if not,
to whom have they been sold?)


7. (U) Washington POC is ISN/MTR John Paul Herrmann
(Phone: 202-647-1430). Please slug any reporting on
this issue for ISN/MTR, EAP/J, EUR/WE, and EUR/PRA.
CLINTON