This record is a partial extract of the original cable. The full text of the original cable is not available.

S E C R E T SECTION 01 OF 02 VIENNA 000232 
 
SIPDIS 
 
STATE FOR ISN/MTR, ISN/CWTR, EUR/PRA AND EUR/AGS 
 
E.O. 12958: DECL: 01/25/2016 
TAGS: PARM PREL MNUC ETTC AU MTCRE
SUBJECT: IRAN NON-PROLIFERATION ACT (INPA) SANCTIONS ON 
STEYR-MANNLICHER -- COMPANY PRESIDENT WANTS TO "EARN" 
REVERSAL OF SANCTIONS 
 
REF: A. PHILLIPS-MITCHELL E-MAILS 1/5/06 
     ¶B. STATE 2371 
     ¶C. 05 VIENNA 3973 
     ¶D. 05 VIENNA 3912 
     ¶E. 05 STATE 226158 
     ¶F. 05 VIENNA 406 
     ¶G. 05 VIENNA 331 
 
Classified By: Charge d'Affaires Scott F. Kilner.  Reasons:  1.4 (b), ( 
d) and (h). 
 
¶1.  (S) Summary:  Wolfgang Fuerlinger, president of the 
Austrian arms firm Steyr-Mannlicher, has contacted the 
Embassy to seek a lifting of INPA sanctions.  Fuerlinger said 
he would do whatever was necessary, including "signing a 
contract" pledging that he would do no more business with 
Iran.  Fuerlinger wants to compete for the U.S. Army assualt 
rifle contract.  End Summary. 
 
¶2.  (SBU) Steyr-Mannlicher president Wolfgang Fuerlinger 
called EconPol Counselor to ask what he can do to achieve a 
lifting of INPA sanctions.  Fuerlinger (disingenuously) 
claimed to have been "completely unaware" of the prospect of 
U.S. sanctions.  He also said the shipment of 12.7 mm. (.50 
cal.) high-power sniper rifles to Iran was "a one-time deal," 
and further asserted that he had made no new shipments and 
done no new business with Iran after the November 2004 
shipment of some 800 of the rifles.  He claimed that his 
company had made the strategic decision to stop sales to Iran 
because of the furor the first sale caused, and because the 
political changes which occurred in Iran made it inadvisable 
to do further business with the country.  Fuerlinger said he 
would even consider "signing a contract" foregoing all 
further business with Iran. 
 
¶3.  (SBU) On January 20, Fuerlinger said a U.S. supplier had 
told him that the Commerce Department advised it not to do 
business with Steyr-Mannlicher.  Fuerlinger claimed that the 
supplier provided "a common steel part" which was not on any 
control list, and he said the deal was a commercial one. 
 
¶4.  (SBU) Fuerlinger said his main concern was his ability to 
compete for the U.S. Army assault rifle contract.  He said he 
would like to have "a clear picture" of whether he should 
proceed with a major investment in the U.S. with a view 
toward securing the contract.  Fuerlinger said he would be in 
Washington in the next few weeks, and was eager to meet with 
relevant U.S. officials to discuss what he could do to obtain 
a lifting of sanctions. 
 
¶5.  (SBU) Note:  Steyr-Mannlicher has recently done business 
with the U.S. government.  In Fall 2005, the Department of 
the Army applied to procure 2,080 Steyr-Mannlicher pistols 
(1,796 MA-1 and 284 MA-9, both 9 mm.) worth 396,000 dollars 
for the Iraqi security forces.  At the end of 2005, U.S. 
Special Operations Command (USSOCOM) sought to purchase seven 
12.7 mm. sniper rifles before it learned that USG sanctions 
prevented the acquisition.  Fuerlinger told us in February 
2005 that he believes his product, the AUG-3, is the best fit 
on the market for the U.S. Army's requirements.  End note. 
 
¶6.  (S) Comment:  Fuerlinger's latest statements about the 
nature of his Iran business are a far cry from what he told 
us in February 2005.  At that time, he said he was "well 
aware" of the provisions of the INPA, but that he would 
choose his more lucrative business in Iran over his U.S. 
operations -- unless we could deliver the assault rifle 
contract to him as compensation (ref g.)  (When we reminded 
him of those earlier statements, he simply denied ever having 
made them.)  Fuerlinger, in fact, did his best to send more 
shipments to Iran, filing for multiple Austrian export 
permits.  He stopped not because of an internal business 
decision, but because the U.S. and Austrian governments 
cooperated to block him.  Fuerlinger was ready to take legal 
action against the Austrian government as late as June 2005 
to force approval of pending export permits.  Now, however, a 
series of circumstances has brought his Iran business 
crashing down.  Contract squabbles with his Malaysian 
subsidiary, Austrian government holding actions to prevent 
shipments to Iran, and the unreliability of his Iranian 
interlocutors have interrupted his dreams of serving as the 
primary supplier to the Iranian army. 
 
¶7.  (S) Comment continued:  Embassy notes that Fuerlinger's 
current posture is remarkably similar to that described in 
ref (b), which concerns an entirely unrelated case in India: 
Fuerlinger says he followed Austrian law and procedure in 
making the sales, and hid nothing from the Austrian 
government.  He has now offered to make written assurances 
that he will do no further business with Iran, and seems 
intent to do everything he can to compete for U.S. government 
business.  End comment. 
 
¶8.  (SBU) Embassy requests Washington guidance on how to 
respond to Fuerlinger's offers. 
KILNER