EXTRANCHECK: POST SHIPMENT VERIFICATION: SOLAR ENERGY

UNCLAS HONG KONG 000300 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: SOLAR ENERGY INTERNATIONAL CO. REF: A) BIS e-mail request dated February 3, 2010 (01210117) ¶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 Solar Energy International Co. (Solar Energy). The items in question for this PSV are various microprocessors exported to Solar Energy on or about September 24, ¶2009. According to information provided by OEA, these microprocessors are likely classified under Export Control Classification Number 3A991 and controlled for anti-terrorism reasons, meaning that they can be shipped license free to virtually all destinations and end-users worldwide without a license. The exporter was Crown Micro International of Fremont, California. ¶3. According to the Hong Kong Companies Registry, Solar Energy International Co., Limited was registered in 2001. It has the Hong Kong equivalent of USD 1250 in share capital. Hong Kong Residents Chu, Ying Kit and Poon, Kuk Man are listed as directors. ¶4. According to the company's web site (www.kukram.com),the company specializes in the computer related peripherals business. The company also markets its own brand of memory modules (kukram). The company serves customers worldwide including in the Middle East. ¶5. On February 8, 2010, ECO and FCS Commercial Assistant Carrie Chan visited the company at the address noted above and met with Mr. Simon Chu (CEO) and his wife, Ms. Poon, Kuk Man (Director). Mr. Chu was quite nervous about the visit and asked several times why the ECO was visiting his company. ¶6. Mr. Chu provided an overview of the company. He noted that the company ships to customers worldwide. Crown Micro (the exporter) is a usual supplier and Solar Energy representatives met this company at the CIBIT event in Germany. According to Mr. Chu, Solar Energy does not sell to any of the embargoed countries (although he had some difficulty naming them) and specifically never to Iran. He noted that, as of late, there is a range of product supply coming from Dubai because of the downturn in the economy there. ECO surmises that the company used to sell more products to Dubai but no longer sells as much in that direction. ¶7. As to the specific shipment in question, Mr. Chu provided documentation confirming that some items had been sold to South Asia Associates and picked up by Zeon Technology Limited (Mr. Chu stated that this was done at the request of the purchaser). According to the Hong Kong Companies Registry, Zeon Technology Limited's directors include Boris Chtchourovski and Olga Smirnova. Other items were sold and delivered to Pronet Group in Moscow (www.pronetgroup.ru). The items for Pronet Group were sent to the company at a Singapore address. Ms. Poon, Kuk Man stated that Pronet consolidates its shipments in Singapore for shipment to Russia. The direction that these items took to get to their (apparent) final destination is somewhat unusual. This is the first time that ECO has seen a shipment of electronics from the United States bound for Russia that was routed through Hong Kong (and Singapore). Mr. Chu and Ms. Poon were not aware of the end uses of the items in question. A final set of products was reexported to Hyde Shenzhen Century Technology Development Co., Ltd., a mainland Chinese software development company. ¶8. Mr. Chu stated that he is keen to comply with U.S. export controls as he will be traveling shortly to the United States. ECO sent, by e-mail, additional information concerning U.S. export controls to Mr. Chu. ¶9. Mr. Chu was, on the whole, open and forthcoming during the meeting and provided the requested documentation. Based on the information at hand, ECO can find no apparent violation associated with these shipments.