2014-02517. Modification of Temporary Denial Order To Add Evans Meridians Ltd. as a Denied Person

In the matter of: 3K Aviation Consulting & Logistics, a/k/a 3K Havacilik Ve Danismanlik SAN. TIC. LTD. ST., Biniciler Apt. Savas Cad. No. 18/5, Sirinyali Mah. 07160, Antalya, Turkey and Sonmez Apt. No. 4/5 1523 Sokak, Sirinyali Mah. 07160, Antalya, Turkey; Huseyin Engin Borluca, Biniciler Apt. Savas Cad. No. 18/5, Sirinyali Mah. 07160, Antalya, Turkey and Sonmez Apt. No. 4/5 1523 Sokak, Sirinyali Mah. 07160, Antalya, Turkey; Adaero International Trade, LLC, 2326 17th Avenue, Rockford, IL 61104 and IDTM B 1 Blok, Kat 14 No: 439, Yesilkoy, Istanbul, Turkey; Recep Sadettin Ilgin, 2326 17th Avenue, Rockford, IL 61104 and IDTM B 1 Blok, Kat 14 No: 439, Yesilkoy, Istanbul, Turkey; Pouya Airline, a/k/a Pouya Air, Mehrebad Airport, Tehran, Iran; Evans Meridians Ltd., Drake Chambers, 1st Floor, Yamraj Building, P.O. Box 3321, Road Town, Tortola, British Virgin Islands; Respondents.

Pursuant to § 766.24 of the Export Administration Regulations (the “Regulations” or “EAR”),^[1] I hereby grant the request of the Office of Export Enforcement (“OEE”) to modify the January 3, 2014 Order Denying the Export Privileges of Adaero International Trade LLC, Recep Sadettin Ilgin, 3K Aviation Consulting and Logistics, Huseyin Engin Borluca and Pouya Air, as I find that modification of the Temporary Denial Order (“TDO”) is necessary in the public interest to prevent an imminent violation of the EAR. Specifically, I find it necessary to add the following person as an additional Respondent in order to prevent an imminent violation of the Regulations and the TDO: Evans Meridians Ltd., Drake Chambers, 1st Floor, Yamraj Building, P.O. Box 3321, Road Town, Tortola, British Virgin Islands.

I. Procedural History

On January 3, 2014, I signed a TDO denying for 180 days the export privileges of 3K Aviation Consulting & Logistics, also known as 3K Havacilik Ve Danismanlik SAN. TIC. LTD. ST. (“3K Aviation”); Huseyin Engin Boluca (3K Aviation Consulting & Leasing's founder and director); Adaero International Trade, LLC (“Adaero”); Recep Sadettin Ilgin (Adaero International Trade's managing director); and Pouya Airline, also known as Pouya Air. The TDO was issued ex parte pursuant to § 766.24(a) and went into effect upon issuance on January 3, 2014. The TDO was published in the Federal Register on January 10, 2014. 79 FR 1823 (Jan. 10, 2014).

In connection with the TDO, OEE presented evidence that in December 2013, two U.S.-origin General Electric CF6 aircraft engines ^[2] bearing manufacturer's serial numbers (“MSN”) 695244 and 705112 were transported on behalf of Adaero International Trade, LLC to 3K Aviation Consulting & Logistics (“3K Aviation”), which is located in Turkey, and that 3K Aviation was preparing to re-export the engines to Iran without the U.S. Government authorization required by § 746.7 of the EAR. OEE had further information that Pouya Airline, an Iranian cargo airline, was scheduled to transport both engines from Turkey to Iran on January 7, 2014.

As discussed further below, OEE has obtained evidence following issuance of the TDO of Evans Meridians Ltd.'s involvement in the attempted export or reexport of the items to Iran.

II. Temporarily Denying Evans Meridians Ltd.'s Export Privileges

A. Legal Standard

Pursuant to § 766.24(b) of the Regulations, BIS may issue an order temporarily denying a Respondent's export privileges 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.

B. BIS's Request To Add Evans Meridians Ltd. to the TDO

In its request, OEE has presented evidence demonstrating that Evans Meridians Ltd. (“Evans Meridians”), a British Virgin Islands company, is involved with the transaction described in the TDO. Prior to issuance of the TDO, OEE did not have evidence of Evans Meridians' relationship to the items or role in the transaction. If the evidence presented in support of this modification had been available during consideration of the TDO, OEE would have sought to include Evans Meridians as a denied person on the TDO when issued on January 3, 2014.

The TDO stated that the engines were transported to 3K Aviation on behalf of Adaero. While it remains true that Adaero was involved in both the sale of the engines and the transfer of the engines from Germany to Turkey, evidence obtained by OEE and presented as part of this request shows that Evans Meridians appears on documents as the purchaser and has acted as the owner of the items in connection with their transfer to 3K Aviation en route to Iran. The two aircraft engines remain in the possession and/or control of 3K Aviation in Turkey in violation of the TDO. Moreover, Evans Meridians has made payment to 3K Aviation, a denied person, for customs storage fees for the engines. The payment to 3K Aviation was made on or about January 21, 2014, that is, 18 days after the TDO issued on January 3, 2014, and 11 days after publication of the TDO on January 10, 2014, in violation of the Regulations and/or the TDO. The evidence presented by OEE also supports its reasonable belief that the continued possession or control of the items by 3K Aviation in Turkey indicates a continued risk that further attempts likely will be made to reexport the items to Iran and thus violate the Regulations and the TDO.

C. Findings

I find that the evidence presented by OEE demonstrates that a violation of the Regulations is imminent in both time and degree of likelihood. Adding Evans Meridians Ltd. to the TDO is needed to give notice to persons and companies in the United States and abroad that they should cease dealing with Evans Meridians in export and re-export transactions involving items subject to the EAR or other activities prohibited by the TDO. Doing so is consistent with the public interest to preclude future violations of the EAR.

Evans Meridians' export privileges are being temporarily denied on an ex parte basis without a hearing based upon BIS's showing of an imminent violation in accordance with § 766.24 of the Regulations.

It is therefore ordered:

First, that 3K AVIATION CONSULTING & LOGISTICS, a/k/a 3K HAVACILIK VE DANISMANLIK SAN. TIC. LTD. ST., Biniciler Apt. Savas Cad. No. 18/5, Sirinyali Mah. 07160, Antalya, Turkey, and Sonmez Apt. No. 4/5 1523 Sokak, Sirinyali Mah. 07160, Antalya, Turkey; HUSEYIN ENGIN BORLUCA, Biniciler Apt. Savas Cad. No. 18/5, Sirinyali Mah. 07160, Antalya, Turkey, and Sonmez Apt. No. 4/5 1523 Sokak, Sirinyali Mah. 07160, Antalya, Turkey; ADAERO INTERNATIONAL TRADE, LLC, 2326 17th Avenue, Rockford, IL 61104, and IDTM B1 Blok, KAT 14 No. 439, Ysilkoy, Istanbul, Turkey; RECEP SADETTIN ILGIN, 2326 17th Avenue, Rockford, IL 61104, and IDTM B1 Blok, KAT 14 No. 439, Ysilkoy, Istanbul, Turkey; POUYA AIRLINE, a/k/a POUYA AIR, Mehrebad Airport, Tehran, Iran; and EVANS MERIDIANS LTD., Drake Chambers, 1st Floor, Yamraj Building, P.O. Box 3321, Road Town, Tortola, British Virgin Islands; and when acting for or on their behalf, any successors or assigns, 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:

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 § 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.

In accordance with the provisions of § 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.

In accordance with the provisions of S§ 766.24(d) of the EAR, BIS may seek renewal of this Order by filing a written request not later than 20 days before the expiration date. The Respondents may oppose a request to renew this Order by filing a written submission with the Assistant Secretary for Export Enforcement, which must be received not later than seven days before the expiration date of the Order.

A copy of this Order shall be served on Evans Meridians and shall be published in the Federal Register.

This Order is effective immediately and shall remain in effect until July 2, 2014, unless renewed in accordance with § 766.24(d) of the Regulations.

Dated: January 30, 2014.

David W. Mills,

Assistant Secretary of Commerce, for Export Enforcement.

Footnotes

1.  The EAR is currently codified at 15 CFR parts 730-774 (2013). The EAR are issued under the Export Administration Act of 1979, as amended (50 U.S.C. app. 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 8, 2013 (78 FR 49107 (Aug. 12, 2013)), has continued the Regulations in effect under the International Emergency Economic Powers Act (50 U.S.C. 1701, et seq.) (2006 & Supp. IV 2010).

2.  The engines are items subject to the Regulations, classified under Export Control Classification Number 9A991.d, and controlled for anti-terrorism reasons.