VZCZCXYZ0006
RR RUEHWEB

DE RUEHC #1592 0072219
ZNR UUUUU ZZH
R 072214Z JAN 10
FM SECSTATE WASHDC
TO RUEHHK/AMCONSUL HONG KONG 0000
INFO RUETIAA/DIRNSA FT GEORGE G MEADE MD
RUEAIIA/CIA WASHINGTON DC
RHMCSUU/FBI WASHINGTON DC 0000
RUEKJCS/SECDEF WASHINGTON DC
RUCPDOC/USDOC WASHINGTON DC 0000

UNCLAS STATE 001592 
 
SIPDIS 
HONG KONG FOR JOHN VERSOSKY 
 
E.O. 12958: N/A 
TAGS: ETTC KOMC HK
SUBJECT: BLUE LANTERN LEVEL 3: POST-LICENSE/PRE-SHIPMENT 
END-USE CHECK ON LICENSE 050207857 
 
¶1. This is an Action Request. See paragraph 4. 
 
¶2. The Department's Office of Defense Trade Controls 
Compliance (PM/DTCC) requests Post's assistance in conducting 
a post-license/pre-shipment check on license 050207857 for 
the export of grenade and grenade launchers to Hong Kong. 
Post is requested to complete this Blue Lantern check within 
30 days.  Lack of response to a Blue Lantern check will 
affect pending and future licenses involving parties to this 
license. 
 
¶3. Reason for Request:  Foreign consignee Props Co. Ltd. has 
appeared on several past licenses but has never been subject 
to a Blue Lantern check.  This request is for Post to 
establish the bona fides of this transaction and the parties 
involved. 
 
¶4. Action Request: Post is requested to establish the bona 
fides of this transaction and Props Co. Ltd. by making 
inquiries to representatives of the company and appropriate 
authorities of the Government of Hong Kong.  The following 
points are included for guidance: 
 
(To Props Co. Ltd.) 
 
--When was your company established and who are its 
principals? 
 
--What products and services does your company provide?  Who 
are your regular customers and where do they reside? 
 
--What are your annual sales of U.S.-origin defense articles? 
 
 
--Do you sell defense articles to customers that reside 
outside Honk Kong?  If so, who are these customers and where 
do they reside? 
 
--What is your role in this transaction?  Please describe the 
exact services you are providing.  How are you being 
compensated for these services? 
 
--Please provide all documentation you received from the 
ultimate end-user of these items (e.g. purchase order and/or 
contract). 
 
--Will you ever have physical possession of these items?  If 
so, please describe your security facilities and procedures. 
 
--Are you familiar with the regulations governing the import 
and brokering of U.S.-origin defense articles, including 
restrictions on unauthorized re-transfer or re-export and the 
requirement for brokers to register with the U.S. Department 
of State? 
 
(To Hong Kong SAR Immigration Department) 
 
--Can you confirm that your agency ordered the defense 
articles listed on this license?  Please provide all 
documentation you issued for this transaction. 
 
--Can you verify the exact types and quantities of defense 
articles your agency ordered in this transaction?  For what 
will these items be used? 
 
--What role is Props Co. Ltd. playing in this transaction? 
Will your agency compensate the company in any way?  If so, 
please describe the services the company provides and the 
terms under which they will be compensated. 
 
--Will Props Co. Ltd. ever have physical possession of these 
items? 
 
(To Appropriate Import/Export and/or Law Enforcement 
Authorities) 
 
--Is Props Co. Ltd. properly authorized to import, broker, 
and/or sell defense articles in Hong Kong? 
 
--Do you have any information on Props Co. Ltd. that would 
call in to question their reliability as a recipient of U.S. 
defense articles? 
 
In its reply, Post may also comment on any other information 
pertinent to these transactions such as security of 
facilities, end-use, and concerns about the entities 
involved. 
 
¶5. Details of license applications: 
 
DTC Case: 050207564 
 
QUANTITY/COMMODITY: 
 
4 Single Shot 37mm Grenade Launchers 
 
40 Foam Baton Cartridges, 37mm 
 
40 Muzzle Blast Cartridges, 37mm 
 
40 Flameless Expulsion CS Grenades 
 
License Value: USD $3,700 
 
SELLER: 
 
Combined Systems Inc. 
98 Cuttermill Road, Suite 231 
Great Neck, NY 11021 
 
FOREIGN INTERMEDIATE CONSIGNEE: 
 
Props Co. Ltd. 
Unit 7, Lower G/F, Full Wing Building 436-450 Chatham Road 
North 
Hunghom, Kowloon 
Hong Kong 
Tel: (852) 2765-8266 / 2764-9930 
Email: props@netvigator.com 
 
FOREIGN END-USER: 
 
Hong Kong SAR Immigration Department 
Immigration Tower 
7 Gloucester Road 
Wan Chai, Hong Kong 
 
PURPOSE: 
 
For Riot and Crowd Control 
 
¶6. Submitted in support of the license application were the 
following documents (PM/DTCC will fax documentation to Posts 
upon request): 
 
DSP-83 Nontransfer and Use Certificate signed by Jacob Kravel 
(Combined Systems) dated 01/05/2010; Ho Ying Hang (Props) 
dated 12/04/2009; and Yu Mei-kow (Immigration Department) 
dated 11/09/2009 
 
Purchase Order issued by Props Co. Ltd. signed by Eddie Ho 
dated 12/21/2009 
 
International Import Certificate No. 9053 issued by 
Government of Hong Kong Special Administrative Region signed 
by L. L. Chau dated 11/19/2009 
 
¶7. Please slug reply for PM/DTCC - BLUE LANTERN COORDINATOR 
and include the words "Blue Lantern" and the case number in 
the subject line.  POC is Kyle M. Ballard, Phone: 
202-663-1929; Email: BallardKM@state.gov; SIPRNET: 
BallardKM@state.sgov.gov.  The Blue Lantern Guidebook (ref) 
is available as a PDF file on Intellipedia: 
http://www.intelink.gov/wiki/ 
Blue Lantern End-Use Monitoring Program 
 
¶8. Department is grateful for Post's assistance in this 
matter. 
CLINTON