[Federal Register Volume 68, Number 222 (Tuesday, November 18, 2003)]
[Notices]
[Pages 65033-65035]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-28796]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Action Affecting Export Privileges; Omega Engineering, Inc.

    In the Matter of: Omega Engineering, Inc., One Omega Drive, 
Stamford, Connecticut 06907, Respondent.

Order

    The Bureau of Industry and Security, United States Department of 
Commerce (``BIS''), having notified Omega Engineering, Inc. (``Omega'') 
of its intention to initiate an administrative proceeding against it 
pursuant to section 13(c) of the Export Administration Act of 1979, as 
amended (50 U.S.C. app. Sec. Sec.  2401-2420 (2000) (``Act''),\1\ and 
the Export Administration Regulations (currently codified at 15 CFR 
parts 730-774 (2003)) (``Regulations''),\2\ based on allegations in a 
proposed charging letter issued to Omega that alleged that Omega 
committed 17 violations of the Regulations. Specifically, the charges 
are:
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    \1\ From August 21, 1994 through November 12, 2000, the Act was 
in lapse. During that period, the President, through Executive Order 
12924, which had been extended by successive Presidential Notices, 
the last of which was August 3, 2000 (3 CFR, 2000 Comp. 397 (2001)), 
continued the Regulations in effect under the International 
Emergency Economic Powers Act (50 U.S.C. 1701-1706 (2000)) 
(``IEEPA''). On November 13, 2000, the Act was reauthorized and it 
remained in effect through August 20, 2001. Since August 21, 2001, 
the Act has been in lapse and the President, through Executive Order 
13222 of August 17, 2001 (3 CFR, 2001 Comp. 783 (2002)), as extended 
by the Notice of August 7, 2003 (68 FR 47833, August 11, 2003)), has 
continued the Regulations in effect under IEEPA.
    \2\ The Regulations are currently codified in the Code of 
Federal Regulations at 15 CFR parts 730-774 (2003). The current 
version of the Regulations govern the procedural aspects of this 
case. The charged violations occurred in 1997. The Regulations 
governing the charged violations are found in the 1997 version of 
the Code of Federal Regulations (15 CFR parts 730-774 (1997)).
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    1. Four Violations of Sec.  764.2(a): Prohibited Conduct: Omega 
made a series of exports of laboratory equipment, including shipments 
on or about June 25, 1997, July 3, 1997, July 11, 1997, and July 16, 
1997, that were routed from the United States to Pakistan via Newport 
Electronics GmbH (Newport) in Germany. This laboratory equipment 
included load cells, load bolts, strain gauges and related parts. By 
that means, Omega, through its Vice President Ralph Michel (Michel), 
conducted or caused to be conducted the same export transaction for 
which the Department of Commerce had denied authorization in response 
to an export license application previously submitted by Omega. On or 
about April 9, 1997, the Department of Commerce denied export license 
application Z097230, which Omega had submitted for the export of 
certain laboratory equipment from the United States to Pakistan. Omega 
appealed this denial pursuant to Section 756.2 of the Regulations. On 
or about May 5, 1997, the Under Secretary of Commerce for Export 
Administration sustained the

[[Page 65034]]

denial of the license application. In making the shipments on the dates 
specified above, Omega engaged in conduct prohibited by or contrary to 
the denial of export license application Z097230 and the Under 
Secretary's upholding of that denial, thereby committing four 
violations of Section 764.2(a) of the Regulations.
    2. Twelve Violations of 15 CFR 764.2(g): False Statements: On or 
about June 25, July 3, July 11, and July 16, 1997, Omega, through an 
employee, submitted or caused to be submitted a Shipper's Export 
Declaration (SED) regarding one of the shipments described above. 
Michel knew that items ultimately destined for Pakistan were included 
in such shipments to Newport in Germany, and then were to be shipped 
from Germany to Pakistan. Each SED falsely identified Newport as the 
ultimate consignee and Germany as the country of ultimate destination. 
Each SED also stated that the export qualified for export pursuant to 
``NLR'' (no license required), when in fact a license was required, as 
the Department of Commerce had previously advised Omega. By submitting 
or causing to be submitted these four SED's, each of which contained 
these three false statements, Omega committed twelve violations of 
Section 764.2(g) of the Regulations.
    3. One Violation of 15 CFR 764.2(e): Acting With Knowledge of a 
Violation: In making or causing to be made the above-described exports, 
Omega, through Michel, acted with knowledge that such exports were 
prohibited by or contrary to the Department of Commerce's denial of its 
export license application and the Under Secretary's sustaining of that 
denial, as described above. By selling and transferring the items 
described above with knowledge that such violation was about to occur 
and was intended to occur in connection with the items, Omega violated 
Section 764.2(e) of the Regulations.
    BIS and Omega having entered into a Settlement Agreement pursuant 
to Section 766.18(a) of the Regulations whereby they agreed to settle 
this matter in accordance with the terms and conditions set forth 
therein, and the terms of the Settlement Agreement having been approved 
by me;
    It Is Therefore Ordered:
    First, that Omega shall pay a civil penalty of $187,000 to the U.S. 
Department of Commerce, as follows: $87,000 to be paid within 30 days 
from the date of entry of the Order; $50,000 to be paid within one year 
from the date of entry of the Order; and $50,000 to be paid within two 
years from the date of entry of the Order. At its option, Omega may 
accelerate this payment schedule. Payment shall be made in the manner 
specified in the attached instructions.
    Second, that, pursuant to the Debt Collection Act of 1982, as 
amended (31 U.S.C. Sec. Sec.  3701-3720E (1983 and Supp. 2000)), the 
civil penalty owed under this Order accrues interest as more fully 
described in the attached Notice, and, if payment is not made by the 
due date specified herein, Omega will be assessed, in addition to the 
full amount of the civil penalty and interest, a penalty charge and an 
administrative charge, as more fully described in the attached Notice.
    Third, that the timely payment of the civil penalty set forth above 
is hereby made a condition to the granting, restoration, or continuing 
validity of any export license, license exception, permission, or 
privilege granted, or to be granted, to Omega. Accordingly, if Omega 
should fail to pay the civil penalty in a timely manner, the 
undersigned may enter an Order denying all of Omega's export privileges 
for a period of one year from the date of entry of this Order.
    Fourth, that for a period of five years from the date of this 
Order, Omega Engineering, Inc., One Omega Drive, Stamford, Connecticut, 
06907, its successors or assigns, and, when acting for or on behalf of 
Omega, its officers, representatives, agents or employees ``Denied 
Persons'') may not, directly or indirectly, participate in any way in 
any transaction involving any commodity, software, or technology 
(hereinafter collectively referred to as ``item'') that is subject to 
the Regulations and that is exported or to be exported from the United 
States to Pakistan, or in any other activity subject to the Regulations 
that involves Pakistan, including, but not limited to:
    A. Applying for, obtaining, or using any license, License 
Exception, or export control document that involves export to Pakistan;
    B. Carrying on negotiations concerning, or ordering, buying, 
receiving, using, selling, delivering, storing, disposing of, 
forwarding, transporting, financing, or otherwise servicing in any way, 
any transaction involving any item that is subject to the Regulations 
and that is exported or to be exported from the United States to 
Pakistan, or in any other activity subject to the Regulations that 
involves Pakistan; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States to Pakistan that is 
subject to the Regulations, or in any other activity subject to the 
Regulations that involves Pakistan.
    Fifth, that no person may, directly or indirectly, do any of the 
actions described below with respect to an item that is subject to the 
Regulations and that has been, will be, or is intended to be exported 
or reexported to Pakistan:
    A. Export or reexport to or on behalf of a Denied Person any item 
subject to the Regulations to Pakistan;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by a Denied Person of the ownership, possession, or control 
of any item subject to the Regulations that has been or will be 
exported from the United States to Pakistan, including financing or 
other support activities related to a transaction whereby a Denied 
Person acquires or attempts to acquire such ownership, possession or 
control;
    C. Take any action to acquire from or to facilitate the acquisition 
or attempted acquisition from a Denied Person of any item subject to 
the Regulations that has been exported from the United States to 
Pakistan;
    D. Obtain from a Denied Person in the United States any item 
subject to the Regulations with knowledge or reason to know that the 
item will be, or is intended to be, exported from the United States to 
Pakistan; or
    E. Engage in any transaction to service any item subject to the 
Regulations that has been or will be exported from the United States to 
Pakistan and that is owned, possessed or controlled by a Denied Person, 
or service any item, of whatever origin, that is owned, possessed or 
controlled by a Denied Person if such service involves the use of any 
item subject to the Regulations that has been or will be exported from 
the United States to Pakistan. For purposes of this paragraph, 
servicing means installation, maintenance, repair, modification or 
testing.
    Sixth, that after notice and opportunity for comment as provided in 
Section 766.23 of the Regulations, any person, firm, corporation, or 
business organization related to Omega by affiliation, ownership, 
control, or position of responsibility in the conduct of trade or 
related services may also be subject to the provisions of this Order.
    Seventh, that this Order does not prohibit any export, reexport, or 
other transaction subject to the Regulations where the only items 
involved that are subject to the Regulations are the foreign-produced 
direct product of U.S.-origin technology.
    Eighth, that the proposed charging letter, the Settlement 
Agreement, and this Order shall be made available to the public.

[[Page 65035]]

    This Order, which constitutes the final agency action in this 
matter, is effective immediately.

    Entered this 12th day of November 2003.
Julie L. Myers,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 03-28796 Filed 11-17-03; 8:45 am]
BILLING CODE 3510-DT-M