[Federal Register Volume 64, Number 82 (Thursday, April 29, 1999)]
[Notices]
[Pages 23051-23052]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10738]
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DEPARTMENT OF COMMERCE
Bureau of Export Administration
Action Affecting Export Privileges; Thane-Coat, Inc., Jerry
Vernon Ford and Preston John Engebretson; Decision and Order on Renewal
of Temporary Denial Order
In the Matters of: Thane-Coat, Inc., 12725 Royal Drive,
Stafford, Texas 77477; Jerry Vernon Ford, President, Thane-Coat,
Inc., 12725 Royal Drive, Stafford, Texas 77477, and with an address
at 7707 Augustine Drive, Houston, Texas 77036; and Preston John
Engebretson, Vice-President, Thane-Coat, Inc., 12725 Royal Drive,
Stafford, Texas 77477, and with an address at 8903 Bonhomme Road,
Houston, Texas 77074, Respondents.
On October 23, 1998, I issued a Decision and Order on Renewal of
Temporary Denial Order (hereinafter ``Order'' or ``TDO''), renewing for
180 days, in a ``non-standard'' format, a May 5, 1997 Order naming,
inter alia, Thane-Coat, Inc.; Jerry Vernon Ford, president, Thane-Coat,
Inc.; and Preston John Engebretson, vice-president, Thane-Coat, Inc.
(hereinafter referred to collectively as the ``Respondents''), as
persons temporarily denied all U.S. export privileges. 63 FR. 58707-
58709 (November 2, 1998).\1\ The Order will expire on April 21, 1999.
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\1\ The May 5, 1997 Order also named Thane-Coat International,
Ltd. and Export Materials, Inc. as persons temporarily denied all
U.S. export privileges. I am issuing a separate Decision and Order
today renewing the TDO against Thane-Coat International, Ltd. (under
its legal name of TIC Ltd.) and Export Materials in a ``standard''
format.
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On April 1, 1999, pursuant to Section 766.24 of the Export
Administration Regulations (currently codified at 15 C.F.R. Parts 730-
774 (1998)) (hereinafter the ``Regulations''), issued pursuant to the
Export Administration Act of 1979, as amended (50 U.S.C.A. app
Secs. 2401-2420 (1991 & Supp. 1998)) (hereinafter the ``Act''),\2\ the
Office of Export Enforcement, Bureau of Export Administration, United
States Department of Commerce (hereinafter BXA''), requested that I
renew the Order against Thane-Coat, Inc., Jerry Vernon Ford, and
Preston John Engebretson for 180 days in a non-standard format,
consistent with the terms agreed to by and between the parties in April
1998.
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\2\ The Act expired on August 20, 1994. Executive Order 12924 (3
C.F.R., 1994 Comp. 917 (1995)), extended by Presidential Notices of
August 15, 1995 (3 C.F.R., 1995 Comp. 501 (1996)), August 14, 1996
(3 C.F.R., 1996 Comp. 298 (1997)), August 13, 1997 (3 C.F.R., 1997
Comp. 306 (1998)), and August 13, 1998 (63 FR 44121, August 17,
1998), continued the Regulations in effect under the International
Emergency Economic Powers Act (currently codified at 50 U.S.C.A.
Secs. 1701-1706 (1991 & Supp. 1998)).
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In its request, BXA stated that, as a result of an ongoing
investigation, it had reason to believe that, during the period from
approximately June 1994 through approximately July 1996, Thane-Coat,
Inc., through Ford and Engebretson, and using its affiliated companies,
TIC Ltd. and Export Materials, Inc., made approximately 100 shipments
of U.S.-origin pipe coating materials, machines, and parts to the Dong
Ah Consortium in Benghazi, Libya. These items were for use in coating
the internal surface of prestressed concrete cylinder pipe for the
Government of Libya's Great Man-Made River Project.\3\ Moreover, BXA's
investigation gave it reason to believe that the Respondents and the
affiliated companies employed a scheme to export U.S.-origin products
from the United States, through the United Kingdom, to Libya, a country
subject to a comprehensive economic sanctions program, without the
authorizations required under U.S. law, including the Regulations. The
approximate value of the 100 shipments at issue was $35 million. In
addition, the Respondents and the affiliated companies undertook
several significant and affirmative actions in connection with the
solicitation of business on another phase of the Great Man-Made River
Project.
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\3\ BXA understands that the ultimate goal of this project is to
bring fresh water from wells drilled in southeast and southwest
Libya through prestressed concrete cylinder pipe to the coastal
cities of Libya. This multibillion dollar, multiphase engineering
endeavor is being performed by the Dong Ah Construction Company of
Seoul, South Korea.
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BXA has stated that it believes that the matters under
investigation and the information obtained to date in that
investigation support renewal of the TDO issued against the
Respondents.\4\ In that regard, in April 1998, BXA and the Respondents
reached an agreement, whereby BXA sought a renewal of the TDO in a
``non-standard'' format, denying all of the Respondents' U.S. export
privileges to the United Kingdom, the Bahamas, Libya, Cuba, Iraq, North
Korea, Iran, and any other country or countries that may be made
subject in the future to a general trade embargo by proper legal
authority. In return, the Respondents agreed that, among other
conditions, at least 14 days in advance of any export that any of the
Respondents intends to make of any item from the United States to any
destination world-wide, the Respondents will provide to BXA's Dallas
Field Office (i) notice of the intended export, (ii) copies of all
documents reasonably related to the subject transaction, including, but
not limited to, the commercial invoice and bill of lading, and (iii)
the opportunity, during the 14-day notice period, to inspect physically
the item at issue to ensure that the intended shipment is in compliance
with the Export Administration Act, the Export Administration
Regulations, or any order issued thereunder. BXA has sought renewal of
the TDO in a ``non-standard'' format.
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\4\ On April 1, 1999, BXA requested that I renew the TDO against
TIC Ltd. and Export Materials, Inc. in a ``standard'' format.
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Based on BXA's showing, I find that it is appropriate to renew the
order temporarily denying the export privileges of Thane-Coat, Inc.,
Jerry Vernon Ford, and Preston John Engebretson in a ``non-standard''
format, incorporating the terms agreed to by and between the parties in
April 1998. I find that such renewal is necessary in the public
interest to prevent an imminent violation of the Regulations and to
give notice to companies in the United States and abroad to cease
dealing with these persons in any commodity, software, or technology
subject to the Regulations and exported or to be exported to the United
Kingdom, the Bahamas, Libya, Cuba, Iraq, North Korea, Iran, and any
other country or countries that may be made subject in the future to a
general trade embargo by proper legal authority, or in any other
activity subject to the Regulations with respect to these specific
countries. Moreover, I find such renewal is in the public interest in
order to reduce the substantial likelihood that Thane-Coat, Inc., Ford
and Engebretson will engage in activities which are in violation of the
Regulations.
Accordingly, it is therefore ordered:
First, that Thane-Coat, Inc., 12725 Royal Drive, Stafford, Texas
77477, and all of its successors or assigns, officers, representatives,
agents, and employees when acting on its behalf; Jerry Vernon Ford,
President, Thane-Coat, Inc., 12725 Royal Drive, Stafford, Texas 77477,
and with an address at 7707 Augustine Drive, Houston, Texas 77036, and
all of his successors, or assigns, representatives, agents and
employees when acting on his behalf; and Preston John Engebretson,
Vice-President, Thane-Coat, Inc., 12725 Royal Drive, Stafford, Texas
77477, and with an
[[Page 23052]]
address at 8903 Bonhomme Road, Houston, Texas 77074, and all of his
successors, or assigns, representatives, agents, and employees when
acting on his behalf (all of the foregoing parties hereinafter
collectively referred to as 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'') subject to the Export Administration Regulations
(hereinafter the ``Regulations'') and exported or to be exported from
the United States to the United Kingdom, the Bahamas, Libya, Cuba,
Iraq, North Korea, or Iran, or to any other country or countries that
may be made subject in the future to a general trade embargo pursuant
to proper legal authority (hereinafter the ``Covered Countries''), or
in any other activity subject to the Regulations with respect to the
Covered Countries, 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 that is subject to the Regulations
and that is exported or to be exported from the United States to any of
the Covered Countries, or in any other activity subject to the
Regulations; or
C. Benefiting in any way from any transaction involving any item
exported or to be exported from the United States to any of the Covered
Countries that is subject to the Regulations, or in any other activity
subject to the Regulations.
Second, that no person may, directly or indirectly, do any of the
following:
A. Export or reexport to or on behalf of any of the denied persons
any item subject to the Regulations to any of the Covered Countries;
B. Take any action that facilitates the acquisition, or attempted
acquisition by any of the denied persons 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 any of the Covered Countries,
including financing or other support activities related to a
transaction whereby any of the denied persons 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 any of the denied persons of any item
subject to the Regulations that has been exported from the United
States to any of the Covered Countries;
D. Obtain from any of the denied persons 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 any of the Covered Countries; 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
any of the Covered Countries, and which is owned, possessed or
controlled by any of the denied persons, or service any item, of
whatever origin, that is owned, possessed or controlled by any of the
denied persons 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 any of the Covered Countries. For purposes of this paragraph,
servicing means installation, maintenance, repair, modification or
testing.
Third, that, at least 14 days in advance of any export that any of
the denied persons intends to make of any item from the United States
to any destination world-wide, the denied person will provide to BXA's
Dallas Field Office (i) notice of the intended export, (ii) copies of
all documents reasonably related to the subject transaction, including,
but not limited to, the commercial invoice and bill of lading, and
(iii) the opportunity, during the 14-day notice period, to inspect
physicially the item at issue to ensure that the intended shipment is
in compliance with the Export Administration Act, the Export
Administration Regulations, or any order issued thereunder.
Fourth, 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 any of the denied persons 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.
Fifth, 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.
Sixth, that, in accordance with the provisions of Section 766.24(e)
of the Regulations, Thane-Coat, Ford, or Engebretson 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.
Seventh, that this Order is effective immediately and shall remain
in effect for 180 days.
Eighth, that, in accordance with the provisions of Section
766.24(d) of the Regulations, BXA may seek renewal of this Order by
filing a written request not later than 20 days before the expiration
date. Any respondent 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 each Respondent and shall
be published in the Federal Register.
Entered this 20th day of April, 1999.
F. Amanda DeBusk,
Assistant Secretary for Export Enforcement.
[FR Doc. 99-10738 Filed 4-28-99; 8:45 am]
BILLING CODE 3510-DT-M
