[Federal Register Volume 75, Number 224 (Monday, November 22, 2010)]
[Notices]
[Pages 71075-71078]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-29327]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Action Affecting Export Privileges; Anvik Technologies Sdn. Bhd., 
a/k/a Anvik Technologies; Babak Jafarpour, a/k/a Bob Jefferson

Anvik Technologies Sdn. Bhd., a/k/a Anvik Technologies
    Level 20, Menara Standard Chartered, 30 Jalan Sultan Ismail, Kuala 
Lumpur 50250, Malaysia
    Level 36, Menara Citibank, 165 Jalan Ampang, Kuala Lumpur 50450, 
Malaysia
    Level 19, Two International Finance Centre, 8 Finance Street 
Central Hong Kong
    155 North Wacker Drive, 42nd Floor, Chicago, IL 60606; and
Babak Jafarpour, a/k/a Bob Jefferson
    Level 20, Menara Standard Chartered, 30 Jalan Sultan Ismail, Kuala 
Lumpur 50250, Malaysia
    Level 36, Menara Citibank, 165 Jalan Ampang, Kuala Lumpur 50450, 
Malaysia
    Level 19, Two International Finance Centre, 8 Finance Street 
Central Hong Kong
    155 North Wacker Drive, 42nd Floor, Chicago, IL 60606
    Respondents.

Order Temporarily Denying Export Privileges

    Pursuant to Section 766.24 of the Export Administration Regulations 
(``EAR'' or the ``Regulations''),\1\ the Bureau of Industry and 
Security (``BIS''), U.S. Department of Commerce, through its Office of 
Export Enforcement (``OEE''), has requested that I issue an Order 
temporarily denying, for a period of 180 days, the export privileges 
under the EAR of:
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    \1\ The EAR is currently codified at 15 CFR parts 730-774 
(2010). The EAR are issued under the Export Administration Act of 
1979, as amended (50 U.S.C. app. Sec. Sec.  2401-2420 (2000)) 
(``EAA''). 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)), which has been extended by successive 
presidential notices, the most recent being that of August 12, 2010 
(75 FR 50681 (Aug. 16, 2010)), has continued the Regulations in 
effect under the International Emergency Economic Powers Act (50 
U.S.C. 1701, et seq.) (``IEEPA'').

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1. Anvik Technologies Sdn. Bhd. a/k/a Anvik Technologies.

    Level 20, Menara Standard Chartered, 30 Jalan Sultan Ismail, Kuala 
Lumpur 50250, Malaysia.
    Level 36, Menara Citibank, 165 Jalan Ampang, Kuala Lumpur 50450, 
Malaysia.
    Level 19, Two International Finance Centre, 8 Finance Street 
Central

[[Page 71076]]

Hong Kong.

    155 North Wacker Drive, 42nd Floor, Chicago, IL 60606.\2\

    \2\ As explained further below, this address is an address for 
``virtual office space'' leased by Respondents from a company called 
Servcorp. See note 4. infra. It is BIS's understanding that other 
persons also rent ``virtual office space'' at this address. The only 
current users at this address subject to this Temporary Denial Order 
as issued are the Respondents listed above. Other persons currently 
using this address are not subject to the Order.

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2. Babak Jafarpour a/k/a Bob Jefferson.

    Level 20, Menara Standard Chartered, 30 Jalan Sultan Ismail, Kuala 
Lumpur 50250, Malaysia.
    Level 36, Menara Citibank, 165 Jalan Ampang, Kuala Lumpur 50450, 
Malaysia.
    Level 19, Two International Finance Centre, 8 Finance Street 
Central Hong Kong.
    155 North Wacker Drive, 42nd Floor, Chicago, IL 60606.\3\.
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    \3\ See footnote 2 above.
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Legal Standard

    Pursuant to Section 766.24(b) of the Regulations, BIS may issue a 
TDO upon a showing that the order is necessary in the public interest 
to prevent an ``imminent violation'' of the Regulations. 15 CFR 
766.24(b)(1). ``A violation may be `imminent' either in time or degree 
of likelihood.'' 15 CFR 766.24(b)(3). BIS may show ``either that a 
violation is about to occur, or that the general circumstances of the 
matter under investigation or case under criminal or administrative 
charges demonstrate a likelihood of future violations.'' Id. As to the 
likelihood of future violations, BIS may show that ``the violation 
under investigation or charges is significant, deliberate, covert and/
or likely to occur again, rather than technical or negligent[.]'' Id. A 
``lack of information establishing the precise time a violation may 
occur does not preclude a finding that a violation is imminent, so long 
as there is sufficient reason to believe the likelihood of a 
violation.'' Id.

Background and Findings

    OEE has presented evidence that, on multiple occasions, beginning 
in October 2009 and continuing to date, Anvik Technologies Sdn. Bhd. 
(``Anvik''), and its owner and operator Babak Jafarpour, have procured 
and attempted to procure various items subject to the Regulations for 
export from the United States to Iran, via transshipment through third 
countries, including Malaysia and Hong Kong, without obtaining the 
required authorization from the U.S. Government.
    OEE, through its investigation, has provided evidence that Anvik 
and Jafarpour (hereinafter collectively referred to as ``Respondents'') 
have been utilizing a global network of leased ``virtual offices'' \4\ 
to procure items from the United States and ship those items to Iran 
through third countries. Respondents use the leased virtual office 
space in order to obtain various addresses, including the addresses in 
Malaysia and Hong Kong, that Respondents then provide to suppliers as 
the ultimate destination and end-users of the items while disguising 
the true ultimate destination and end-users in Iran. OEE has identified 
at least four transactions where the Respondents have shipped or 
attempted to ship items to Iran using the same method of operation, 
including two attempted exports to Iran as recently as September 2010. 
In this section, I discuss evidence obtained by OEE relating to those 
transactions and submitted to me in support of its TDO request.
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    \4\ A ``virtual office'' arrangement provides users with 
communication and physical office services available to a typical 
lessee of office space, providing the appearance that the user 
maintains an office at the virtual office location. Virtual office 
users can use phone numbers, physical/mailing addresses, 
receptionist services, etc. without actually leasing space or ever 
being present at the virtual office.
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    Between February and June 2010, Respondents exchanged email 
messages with a U.S. manufacturer concerning the procurement of 
microwave mixers and bias tees. These items, which are components used 
in communications and radar systems, are subject to the Regulations and 
designated as EAR99. Respondents' email messages with the U.S. 
manufacturer originated in Iran. However, Respondents completed an end-
user statement that they provided to the U.S. manufacturer stating that 
the microwave mixers and bias tees were to be used by Anvik at its 
address at 155 North Wacker Drive, 42nd Floor, Chicago, IL 60606.
    On September 7, 2010, on the instructions of Respondents, the U.S. 
manufacturer shipped the microwave mixers and bias tees to the address 
in Chicago provided by Respondents. However, the Chicago, IL address is 
for the ``virtual office'' at which Respondents do not occupy any 
physical space or otherwise have operations that would enable them to 
use these items there, and instead only lease certain services, such as 
remote receptionist and administrative support and use of the local 
phone number and address. When the microwave mixers and bias tees 
arrived in Chicago, the ``virtual office'' staff, on the instructions 
of Respondent Jafarpour, replaced the manufacturer's invoice with one 
provided by him and shipped the items to another of Respondents' 
``virtual office'' addresses, at Level 20, Menara Standard Chartered, 
30 Jalan Sultan Ismail, Kuala Lumpur 50250, Malaysia. Jafarpour 
instructed the virtual office staff in Malaysia to forward the package 
to Iran upon receipt. However, the shipment was stopped in Malaysia 
prior to being delivered to the virtual office address there.
    As provided in Section 746.7 of the Regulations, no person may 
export or reexport any item that is subject to the EAR, if such 
transaction is prohibited by the Iranian Transactions Regulations (31 
CFR part 560) and has not been authorized by OFAC. The evidence shows 
that using the scheme described above, Respondents took actions to 
evade the Regulations by exporting microwave mixers and bias tees from 
the United States to Iran through Malaysia. Respondents intended to 
have the shipment relabeled and delivered to a forwarder/shipper for 
transshipment to Iran once it arrived in Malaysia. Respondents had not 
sought or received the required U.S. Government authorization.
    OEE's investigation has uncovered another recent attempt by 
Respondents to procure items for Iranian end-users in violation of the 
Regulations. Beginning in or about September 2010, Respondents 
attempted to export GPS timing boards, items subject to the 
Regulations, classified as Export Control Classification Number 7A994, 
and controlled for anti-terrorism reasons, from the United States to 
Iran without the license required under Section 742.8 of the 
Regulations to export or reexport anti-terrorism controlled items to 
Iran. The order was placed with a U.S. manufacturer through its Swedish 
distributor. The purchase order submitted by Anvik stated that the 
terms of delivery were ``FOB USA,'' indicating that Respondents knew 
the items were being exported from the United States. Respondents 
ordered the GPS timing boards using an address at Level 19, Two 
International Finance Centre, 8 Finance Street Central, Hong Kong. This 
address is ``virtual office'' space leased by Respondents. Respondents 
provided a different address, at Level 20, Menara Standard Chartered, 
30 Jalan Sultan Ismail, Kuala Lumpur 50250, Malaysia, as the ``ship 
to'' address on the order form. This address also is ``virtual office'' 
space leased by Respondents. The shipping label on the package that 
arrived at Respondent Anvik's address in Malaysia stated that it was 
from the U.S.

[[Page 71077]]

manufacturer in New York, United States, and the packing list included 
an export control warning from the U.S. manufacturer and a certificate 
of U.S. origin. Information provided by the forwarder demonstrates 
that, once the GPS timing boards were delivered to the address in 
Malaysia, they were immediately relabeled for shipment by the same 
forwarder to Iran. The shipment from Malaysia to Iran was stopped in 
Singapore while en route to Iran.
    OEE also has uncovered other transactions in which Respondents were 
able to successfully procure items subject to the Regulations and cause 
their export from the United States to Iran via transshipment through 
third countries. Respondents used methods similar to those described 
above, having the items shipped to ``virtual offices'' they leased 
abroad and then transshipping the items from there to Iran.
    In September 2009, Respondents placed an order with a U.S. 
manufacturer through its Singapore-based distributor for ten digital 
phase shifters. These items, which have a number of uses, including in 
radar systems, satellite communications, phase cancellation and 
beamforming modules, are subject to the Regulations and designated as 
EAR99. Respondents provided the U.S. manufacturer and its distributor 
with an end-user statement indicating that the digital phase shifters 
would be used by Anvik at Level 36, Menara Citibank, 165 Jalan Ampang, 
Kuala Lumpur 50450, Malaysia, and certifying that the items ``will not 
be diverted to any country, company or individual that is prohibited by 
the U.S. Government.'' The address listed on the end-user statement is 
a ``virtual office'' address leased by Respondents. On October 19, 
2009, the U.S. manufacturer exported the digital phase shifters to 
Anvik in Malaysia via the distributor in Singapore. Evidence uncovered 
by OEE demonstrates that, once the package arrived in Malaysia, 
Respondents promptly instructed the ``virtual office'' staff to ship 
the package to ECI Co. in Shiraz, Iran. Respondents did not obtain the 
required U.S. Government authorization to export the digital phase 
shifters from the United States to Iran.
    On October 27, 2009, a U.S. manufacturer exported a 
millidioptometer to Anvik at Level 36, Menara Citibank, 165 Jalan 
Ampang, Kuala Lumpur 50450, Malaysia. This item, which is a measuring 
tool used for various optical systems, including those in aircraft 
systems, is subject to the Regulations and designated as EAR99. The 
address provided by Anvik is a virtual office address leased by 
Respondents. Evidence obtained by OEE indicates that, at the request of 
Respondent Jafarpour, the virtual office staff arranged for the 
millidioptometer to be promptly transshipped on Respondents' behalf 
from Malaysia to IOI (Isfahan Optics Institute), a subsidiary of Iran 
Electronics Industries in Isfahan, Iran.\5\ Respondents did not obtain 
the required U.S. Government authorization to export the digital phase 
shifters from the United States to Iran.
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    \5\ On September 17, 2008, the U.S. Department of Treasury 
designated Iran Electronics Industries as a Weapons of Mass 
Destruction proliferator or supporter pursuant to Executive Order 
13382. Iran Electronics Industries was designated because it is 
owned or controlled by Iran's Ministry of Defense and Armed Forces 
Logistics (MODAFL). MODAFL, which was designated under Executive 
Order 13382 on October 25, 2007, controls other previously 
designated entities DIO, and Aerospace Industries Organization, 
which is the overall manager and coordinator of Iran's missile 
program.
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    In addition to the evidence discussed above showing continued 
deliberate and covert actions by Anvik and Jafarpour to cause or 
attempt to cause items to be exported from the United States to Iran 
via third countries without obtaining U.S. Government authorization, 
BIS also has submitted direct evidence that Respondents had actual 
knowledge of the U.S. embargo against Iran. For example, in 
communications in June 2009, with a prospective supplier based in 
Canada, Respondent Jafarpour acknowledges knowing that the United 
States maintains an embargo against Iran.
    OEE submits, in sum, that future violations of the EAR are imminent 
as defined in Section 766.24 of the Regulations. I agree based on the 
evidence of Respondents' continued deliberate, significant, and covert 
efforts to procure items from the United States for export to Iran via 
third countries without the required U.S. Government authorization, 
including by providing false information to U.S. companies about end-
users in an effort to prevent U.S. law enforcement officials from 
discovering and ultimately stopping Respondents' conduct. Accordingly, 
I find that the evidence presented by OEE demonstrates that a violation 
of the Regulations by Respondents is imminent in both time and degree 
of likelihood. The conduct in this case is deliberate, significant, and 
likely to occur again absent the issuance of a TDO. As such, a TDO is 
needed to give notice to persons and companies in the United States and 
abroad that they should cease dealing with the Respondents in export 
transactions involving items subject to the EAR.
    Accordingly, I find that a TDO naming Anvik Technologies Sdn. Bhd. 
and Babak Jafarpour is necessary, in the public interest, to prevent an 
imminent violation of the EAR.
    This Order is being issued on an ex parte basis without a hearing 
based upon BIS's showing of an imminent violation.

I. Order

    It is therefore ordered:

    First, that the Respondents, Anvik Technologies SDN. BHD. also 
known as (``a/k/a'') Anvik Technologies, Level 20, Menara Standard 
Chartered, 30 Jalan Sultan Ismail, Kuala Lumpur 50250, Malaysia; Level 
36, Menara Citibank, 165 Jalan Ampang, Kuala Lumpur 50450, Malaysia; 
Level 19, Two International Finance Centre, 8 Finance Street Central, 
Hong Kong; 155 North Wacker Drive, 42nd Floor, Chicago, IL 60606; Babak 
Jafarpour a/k/a Bob Jefferson, Level 20, Menara Standard Chartered, 30 
Jalan Sultan Ismail, Kuala Lumpur 50250, Malaysia; Level 36, Menara 
Citibank, 165 Jalan Ampang, Kuala Lumpur 50450, Malaysia; Level 19, Two 
International Finance Centre, 8 Finance Street Central, Hong Kong; 155 
North Wacker Drive, 42nd Floor, Chicago, IL 60606, and each of their 
successors or assigns and, when acting for or on behalf of any of the 
foregoing, each of their officers, representatives, agents or employees 
(each a ``Denied Person'' and collectively the ``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'') exported or to be exported from 
the United States that is subject to the Export Administration 
Regulations (``EAR''), or in any other activity subject to the EAR 
including, but not limited to:
    A. Applying for, obtaining, or using any license, License 
Exception, or export control document;
    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 exported or to be exported from the 
United States that is subject to the EAR, or in any other activity 
subject to the EAR; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States that is subject to 
the EAR, or in any other activity subject to the EAR.

    Second, that no person may, directly or indirectly, do any of the 
following:

[[Page 71078]]

    A. Export or reexport to or on behalf of a Denied Person any item 
subject to the EAR;
    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 EAR that has been or will be exported from 
the United States, 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 EAR that has been exported from the United States;
    D. Obtain from a Denied Person in the United States any item 
subject to the EAR with knowledge or reason to know that the item will 
be, or is intended to be, exported from the United States; or
    E. Engage in any transaction to service any item subject to the EAR 
that has been or will be exported from the United States and which 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 EAR 
that has been or will be exported from the United States. For purposes 
of this paragraph, servicing means installation, maintenance, repair, 
modification or testing.
    Third, that, after notice and opportunity for comment as provided 
in section 766.23 of the EAR, any other person, firm, corporation, or 
business organization related to a Denied Person by affiliation, 
ownership, control, or position of responsibility in the conduct of 
trade or related services may also be made subject to the provisions of 
this Order.
    Fourth, that this Order does not prohibit any export, reexport, or 
other transaction subject to the EAR where the only items involved that 
are subject to the EAR are the foreign-produced direct product of U.S.-
origin technology.
    In accordance with the provisions of Section 766.24(e) of the EAR, 
the Respondents may, at any time, appeal this Order by filing a full 
written statement in support of the appeal with the Office of the 
Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40 
South Gay Street, Baltimore, Maryland 21202-4022.
    BIS may seek renewal of this Order by filing a written request with 
the Assistant Secretary of Commerce for Export Enforcement in 
accordance with the provisions of Section 766.24(d) of the EAR, which 
currently provides that such a written request must be submitted not 
later than 20 days before the expiration date. A Respondent may oppose 
a request to renew this Order in accordance with Section 766.24(d), 
including by filing a written submission with the Assistant Secretary 
of Commerce for Export Enforcement, supported by appropriate evidence. 
Any opposition ordinarily must be received not later than seven days 
before the expiration date of the Order.
    Notice of the issuance of this Order shall be given to Respondents 
in accordance with Sections 766.5(b) and 766.24(b)(5) of the 
Regulations. This Order also shall be published in the Federal 
Register.
    This Order is effective immediately and shall remain in effect for 
180 days.

    Issued this 15th day of November 2010.
David W. Mills,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2010-29327 Filed 11-19-10; 8:45 am]
BILLING CODE 3510-DT-P