[Federal Register Volume 79, Number 161 (Wednesday, August 20, 2014)]
[Notices]
[Pages 49283-49285]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-19714]



[[Page 49283]]

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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

[14-BIS-002]


In the Matter of: Gatewick LLC, a/k/a Gatewick Freight & Cargo 
Services a/k/a Gatewick Aviation Services, Mohamad Abdulla Algaz 
Building, Al Maktoum Street, Al Rigga, Dubai, United Arab Emirates and, 
G#22 Dubai Airport Free Zone, P.O. Box 393754, Dubai, United 
Arab Emirates and, P.O. Box 52404, Dubai, United Arab Emirates, 
Respondent

Order Relating to Gatewick LLC

    The Bureau of Industry and Security, U.S. Department of Commerce 
(``BIS''), has notified Gatewick LLC, of Dubai, United Arab Emirates, 
a/k/a Gatewick Freight & Cargo Services, a/k/a Gatewick Aviation 
Services (``Gatewick''), that it has initiated an administrative 
proceeding against Gatewick pursuant to Section 766.3 of the Export 
Administration Regulations (the ``Regulations''),\1\ and Section 13(c) 
of the Export Administration Act of 1979, as amended (the ``Act''),\2\ 
through the issuance of a Charging Letter to Gatewick that alleges that 
Gatewick committed three violations of the Regulations. Specifically, 
the charges are:
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    \1\ The Regulations are currently codified in the Code of 
Federal Regulations at 15 CFR Parts 730-774 (2014). The charged 
violations occurred in 2009. The Regulations governing the 
violations at issue are found in the 2009 version of the Code of 
Federal Regulations (15 CFR Parts 730-774) (2009). The 2014 
Regulations set forth the procedures that apply to this matter.
    \2\ 50 U.S.C. app. Sec. Sec.  2401-2420 (2000). 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 7, 2014 (79 FR 46959 (Aug. 11, 2014)), 
has continued the Regulations in effect under the International 
Emergency Economic Powers Act (50 U.S.C. 1701, et seq. (2006 & Supp. 
IV 2010)).
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Charge 1: 15 CFR 764.2(d)--Conspiracy

    In or about February 2009, Gatewick LLC (``Gatewick'') conspired 
and acted in concert with others, known and unknown, to bring about an 
act that constitutes a violation of the Regulations. The purpose of the 
conspiracy was to bring about the export from the United States to 
Iran, via the United Arab Emirates (``UAE''), of approximately 2,300 
computer motherboards, items subject to the Regulations \3\ and valued 
at approximately $130,000, without the required U.S. Government 
authorization. Pursuant to Section 746.7 of the Regulations, no person 
may export or reexport an item subject to the EAR if such transaction 
is prohibited by the Iranian Transactions Regulations (``ITR''), and 
has not been authorized by the U.S. Department of the Treasury's Office 
of Foreign Assets Control (``OFAC''). Under Section 560.204 of the ITR, 
the exportation, reexportation, sale or supply, directly or indirectly, 
from the United States of any goods to Iran was prohibited by the ITR 
\4\ at all times pertinent hereto, including the exportation, 
reexportation, sale or supply of items from the United States to a 
third country, such as the UAE, undertaken with knowledge or reason to 
know that the items were intended for supply, transshipment, or 
reexportation, directly or indirectly, to Iran.
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    \3\ The items are designated as EAR99, which is the designation 
for items subject to the Regulations but not included on the 
Commerce Control List. See 15 CFR 774.1 (2009).
    \4\ 31 CFR Part 560 (2009). Administered by the Treasury 
Department's Office of Foreign Assets Control (``OFAC''), the ITR 
were renamed the Iranian Transactions and Sanctions Regulations 
(``ITSR'') and reissued in their entirety by OFAC on October 22, 
2012. See 77 Fed.Reg. 64,664 (Oct. 22, 2012). Section 560.204 
remains unchanged in pertinent part. See 31 CFR 560.204 (2009 and 
2014).
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    Gatewick is a freight and cargo services company in the UAE and at 
all times pertinent hereto the sole booking agent for air freight 
forwarding and cargo services for Mahan Airways, an Iranian airline. 
Gatewick entered into an agreement with Seyed Mousavi Trading, an 
Iranian trading company, in connection with the export of the items to 
Iran. Gatewick agreed to receive the goods ordered by Seyed Mousavi 
Trading from the United States using Mahan Airways' import code and to 
then ship the goods from the UAE to their destination in Iran. In 
furtherance of the conspiracy, Seyed Mousavi Trading, which identified 
itself to the U.S. reseller as a UAE company, ordered the 2,300 
computer motherboards from the reseller for shipment to the UAE. The 
motherboards were actually destined for Seyed Mousavi Trading's 
customer in Iran. Pursuant to Seyed Mousavi Trading's instructions, the 
U.S. reseller shipped the motherboards, from the United States to 
Gatewick's location in the UAE. Consistent with the agreed-upon scheme, 
Gatewick received the items on February 8, 2009. Gatewick shipped the 
items the following day, February 9, 2009, from the UAE to Iran via 
Mahan Airways. No U.S. Government authorization was received for the 
export of the computer motherboards to Iran.
    In so doing, Gatewick committed one violation of Section 764.2(d) 
of the Regulations.

Charge 2: 15 CFR 764.2(b)--Causing, Aiding or Abetting an Unlicensed 
Export

    On or about February 8 and February 9, 2009, Gatewick caused, 
aided, or abetted a violation of the Regulations. Specifically, 
Gatewick facilitated the export from the United States to Iran, via the 
UAE, of approximately 2,300 computer motherboards, items subject to the 
Regulations \5\ and valued at approximately $130,000, without the 
required U.S. Government authorization. Gatewick received the items in 
the UAE from the United States, and, upon receiving the items, Gatewick 
shipped them from the UAE to Iran.
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    \5\ The items are designated as EAR99, which is the designation 
for items subject to the Regulations but not included on the 
Commerce Control List. See 15 CFR 774.1 (2009).
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    Pursuant to Section 746.7 of the Regulations, no person may export 
or reexport an item subject to the EAR if such transaction is 
prohibited by the Iranian Transactions Regulations (``ITR''), and has 
not been authorized by the U.S. Department of the Treasury's Office of 
Foreign Assets Control (``OFAC''). Under Section 560.204 of the ITR,\6\ 
the exportation, reexportation, sale or supply, directly or indirectly, 
from the United States of any goods to Iran was prohibited by the ITR 
at all times pertinent hereto, including the exportation, 
reexportation, sale or supply of items from the United States to a 
third country, such as the UAE, undertaken with knowledge or reason to 
know that the items were intended for supply, transshipment, or 
reexportation, directly or indirectly, to Iran. No OFAC authorization 
was sought or obtained for the export of the computer motherboards to 
Iran.
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    \6\ 31 CFR Part 560 (2009). Administered by the Treasury 
Department's Office of Foreign Assets Control (``OFAC''), the ITR 
were renamed the Iranian Transactions and Sanctions. Regulations 
(``ITSR'') and reissued in their entirety by OFAC on October 22, 
2012. See 77 Fed.Reg. 64,664 (Oct. 22, 2012). Section 560.204 
remains unchanged in pertinent part. See 31 CFR 560.204 (2009 and 
2014).
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    In so doing, Gatewick committed one violation of Section 764.2(b) 
of the Regulations.

Charge 3: 15 CFR 764.2(k)--Acting Contrary to the Terms of a Denial 
Order

    On or about February 8 and February 9, 2009, Gatewick took actions 
prohibited by a BIS denial order. Specifically, Gatewick took actions 
that, contrary to the terms of a BIS denial order, facilitated the 
acquisition by Mahan Airways, an Iranian airline and a denied person 
since March 21, 2008, of the ownership, possession or control of 
approximately 2,300 computer

[[Page 49284]]

motherboards, items subject to the Regulations \7\ and valued at 
approximately $130,000. The items were exported from the United States 
to Gatewick's location in the UAE. Gatewick used Mahan Airways import 
code to receive the items in the UAE and then shipped the items from 
the UAE to Iran via Mahan Airways.
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    \7\ The items are designated as EAR99, which is the designation 
for items subject to the Regulations but not included on the 
Commerce Control List. See 15 CFR 774.l (2009).
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    Mahan Airways was named as a Denied Person in a temporary denial 
order (``TDO'') issued by BIS effective on March 21, 2008, and was 
subsequently renewed by BIS and in force and effect at all pertinent 
times hereto.\8\ Under the TDO, all persons, including Gatewick, were 
prohibited from ``taking any action that facilitates the acquisition or 
attempted acquisition by the Denied Person [Mahan Airways] of the 
ownership, possession, or control of any item subject to the EAR that 
has been or will be exported from the United States. . . .''
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    \8\ The initial TDO was issued by BIS on March 17, 2008, and 
effective upon publication in the Federal Register on March 21, 
2008. 73 FR 15,130. The TDO was renewed for 180 days on September 
17, 2008, by order effective upon issuance on that date. 73 FR 
57,051 (Oct. 1, 2008). The TDO remains in effect today against Mahan 
Airways, having been renewed most recently on July 22, 2014. 79 FR 
44,002 (Jul. 29, 2014).
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    In acting contrary to the terms of a BIS denial order, as alleged 
above, Gatewick committed one violation of Section 764.2(k) of the 
Regulations.
    Whereas, BIS and Gatewick have entered into a Settlement Agreement 
pursuant to Section 766.18(b) of the Regulations, whereby they agreed 
to settle this matter in accordance with the terms and conditions set 
forth therein; \9\ and
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    \9\ The citation dates in footnotes 1, 2, 4, 6 and 8 of the 
Charging Letter have been updated, as applicable, from 2013 to 2014 
for purposes of the Settlement Agreement and this Order.
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    Whereas, I have approved of the terms of such Settlement Agreement;
    It is therefore ordered:
    First, Gatewick shall be assessed a civil penalty in the amount of 
$40,000. Gatewick shall pay the U.S. Department of Commerce in two 
installments of: $20,000 not later than September 1, 2014; and $20,000 
not later than December 1, 2014. If either of the two installment 
payments is not fully and timely made, any remaining scheduled 
installment payments may become due and owing immediately.
    Second, that, pursuant to the Debt Collection Act of 1982, as 
amended (31 U.S.C. 3701-3720E (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, 
Gatewick 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 for a period of seven (7) years from the date of this 
Order, Gatewick LLC, also known as Gatewick Freight & Cargo Services, 
also known as Gatewick Aviation Services, with last known addresses of 
Mohamad Abdulla Algaz Building, Al Maktoum Street, Al Rigga, Dubai, 
United Arab Emirates and G#22 Dubai Airport Free Zone, P.O. Box 
393754, Dubai, United Arab Emirates and P.O. Box 52404, Dubai, United 
Arab Emirates, and when acting for or on its behalf, its successors, 
assigns, representatives, directors, officers, employees, or agents 
(hereinafter collectively referred to as ``Denied Person''), 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 Regulations, or in any other 
activity subject to the Regulations, 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 Regulations, or in any other 
activity subject to the Regulations; 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 Regulations, or in any other activity subject to the Regulations.
    Fourth, that no person may, directly or indirectly, do any of the 
following:
    A. Export or reexport to or on behalf of the Denied Person any item 
subject to the Regulations;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by the 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, including financing or other support 
activities related to a transaction whereby the 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 the Denied Person of any item subject to 
the Regulations that has been exported from the United States;
    D. Obtain from the 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; 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 
and which is owned, possessed or controlled by the Denied Person, or 
service any item, of whatever origin, that is owned, possessed or 
controlled by the 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. For purposes of this paragraph, servicing means 
installation, maintenance, repair, modification or testing.
    Fifth, 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 the 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 
the Order.
    Sixth, that the seven-year denial period set forth above shall be 
active for a period of two years from the date of this Order. As 
authorized by Section 766.18(c) of the Regulations, the remaining five 
years of the denial period shall be suspended during a probationary 
period of five years under this Order, and shall thereafter be waived, 
provided that Gatewick has made full and timely payment as set forth 
above and has committed no other violation of the Act or the 
Regulations or any order, license or authorization issued thereunder. 
If Gatewick does not make full and timely payment as set forth above, 
or commits another violation of the Act or the Regulations or any 
order, license or authorization issued thereunder during the seven-year 
denial period under this Order, the five-year suspended portion of this 
Order may be modified or revoked by BIS. If the suspension is modified 
or revoked, BIS may extend the active denial period up to seven years 
from the date of this Order if the failure to pay or other violation 
and the activation occur during the first two years from the date of 
this Order, or otherwise until up to five years from the date of the 
activation if the violation occurs or BIS discovers

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the violation more than two years from the date of this Order.
    Seventh, Gatewick shall not take any action or make or permit to be 
made any public statement, directly or indirectly, denying the 
allegations in the Charging Letter or this Order. The foregoing does 
not affect Gatewick's testimonial obligations in any proceeding, nor 
does it affect its right to take legal or factual positions in civil 
litigation or other civil proceedings in which the U.S. Department of 
Commerce is not a party.
    Eighth, that the Charging Letter, the Settlement Agreement, and 
this Order shall be made available to the public.
    Ninth, that this Order shall be served on Gatewick, and shall be 
published in the Federal Register.
    This Order, which constitutes the final agency action in this 
matter, is effective immediately.

    Issued this 13th day of August 2014.
David W. Mills,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2014-19714 Filed 8-19-14; 8:45 am]
BILLING CODE P