[Federal Register Volume 69, Number 139 (Wednesday, July 21, 2004)]
[Notices]
[Page 43656]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-16588]



[[Page 43656]]

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DEPARTMENT OF STATE

[Public Notice 4768]


Bureau of Political-Military Affairs; Rescission of Statutory 
Debarment and Reinstatement of Eligibility To Apply for Export/
Retransfer Authorizations Pursuant to Section 38(g)(4) of the Arms 
Export Control Act; Armaments Corporation of South Africa Ltd. 
(Armscor) and the Denel Group (Pty) Ltd. (Denel)

AGENCY: Department of State.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the Department of State has fully 
rescinded the statutory debarment against the Armaments Corporation of 
South Africa Ltd. (Armscor) and the Denel Group (Pty) Ltd. (Denel) and 
its divisions; and any divisions, subsidiaries, associated companies, 
affiliated persons, and successor entities pursuant to section 38(g)(4) 
of the Arms Export Control Act (AECA) (22 U.S.C. 2778) and Sec.  127.11 
of the International Traffic in Arms Regulations (ITAR) (22 CFR parts 
120-130).

EFFECTIVE DATE: July 14, 2004.

FOR FURTHER INFORMATION CONTACT: Robert W. Maggi, Managing Director, 
Directorate of Defense Trade Controls, Bureau of Political-Military 
Affairs, Department of State (202) 663-2700.

SUPPLEMENTARY INFORMATION: Section 38(g)(4) of the AECA and Sec.  127.7 
of the ITAR prohibit the issuance of export licenses or other approvals 
to a person, or any party to the export, who has been convicted of 
violating certain U.S. criminal statutes enumerated at section 
38(g)(1)(A) of the AECA and Sec.  120.27 of the ITAR. The term 
``person'' means a natural person as well as a corporation, business 
association, partnership, society, trust, or any other entity, 
organization, or group, including governmental entities. The term 
``party to the export'' means the president, the chief executive 
officer, and any other senior officers of the license applicant; and 
any consignee or end-user of any item to be exported.
    Effective June 8, 1994, the Department of State implemented a 
policy of denial pursuant to sections 38 and 42 of the AECA and 
Sec. Sec. 126.7(a)(1) and (a)(2) of the ITAR for Armscor, Denel and its 
divisions (including Kentron (Pty) Ltd.), and any divisions, 
subsidiaries, associated companies, affiliated persons, and successor 
entities based upon an indictment returned in the U.S. District Court 
for the Eastern District of Pennsylvania charging Armscor and Kentron 
with violating and conspiring to violate the AECA (see 59 FR 33811, 
June 30, 1994).
    Subsequently, after the companies accepted plea agreements in 
connection with the criminal charges, the Department of State imposed 
statutory debarment against Armscor and Denel and its divisions 
effective February 27, 1997 (see 62 FR 13932, March 24, 1997).
    A Federal Register notice was published on March 4, 1998 (63 FR 
10671), that rescinded the policy of denial and temporarily suspended 
the statutory debarment against Armscor and Denel in accordance with 
section 38(g)(4) of the AECA. The temporary suspension of the statutory 
debarment was consistent with the Agreement Between the Government of 
the United States of America and the Government of the Republic of 
South Africa Concerning Cooperation on Defense Trade Controls (the 
Agreement). The Agreement provided that the companies would establish 
internal compliance programs and further required that the companies 
would make available an amount of money equivalent to suspended civil 
fines to the South African Government to support the effective 
implementation of its national export control regime.
    Section 38(g)(4) of the AECA permits rescission of debarment after 
consultation with the Secretary of the Treasury and after a thorough 
review of the circumstances surrounding the conviction and a finding 
that appropriate steps have been taken to mitigate any law enforcement 
concerns. After thoroughly reviewing the steps Armscor and Denel have 
taken with respect to the establishment of internal compliance programs 
and supporting the effective implementation of a national export 
regime, the Department of State has determined that Armscor and Denel 
have taken the appropriate initiatives to address the causes of the 
violations and to mitigate any law enforcement concerns.
    Therefore, in accordance with section 38(g)(4) of the AECA and 
section 127 of the ITAR, effective July 14, 2004, the debarment against 
Armscor and Denel is fully rescinded. The effect of this notice is that 
Armscor, Denel and its divisions, and any divisions, subsidiaries, 
associated companies, affiliated persons, and successor entities may 
participate, without prejudice, in the export or transfer of defense 
articles, related technical data, and defense services subject to 
section 38 of the AECA and the ITAR.

    Dated: July 14, 2004.
Lincoln P. Bloomfield, Jr.,
Assistant Secretary, Bureau of Political-Military Affairs, Department 
of State.
[FR Doc. 04-16588 Filed 7-20-04; 8:45 am]
BILLING CODE 4710-25-P