VZCZCXYZ0012
RR RUEHWEB

DE RUEHHK #1566 1630712
ZNR UUUUU ZZH
R 120712Z JUN 07
FM AMCONSUL HONG KONG
TO RUCPDOC/USDOC WASHDC
INFO RUEHC/SECSTATE WASHDC 1910
RHMFIUU/HQ BICE WASHINGTON DC

UNCLAS HONG KONG 001566 
 
SIPDIS 
 
USDOC FOR 532/OEA/LHINES/DFARROW 
USDOC FOR 3132 FOR FCS/OIO REGIONAL DIRECTOR 
WILLIAM ZARIT 
BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: BMGT BEXP HK ETRD ETTC
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION: 
HK KOON YUE INDUSTRIAL 
 
REF: A) USDOC 03923 
 
1.Unauthorized disclosure of the information 
provided below is prohibited by Section 12C of the 
Export Administration Act. 
 
¶2. As per reftel A request and at the direction of 
the Office of Enforcement Analysis (OEA) of the 
USDOC Bureau of Industry and Security (BIS), 
Export Control Officer Philip Ankel (ECO) 
conducted a post shipment-verification at HK Koon 
Yue Industrial, 9/F May Gar Commercial Building, 
288 Reclamation Street, Yau Ma Tei, Kowloon, Hong 
Kong (Koon Yue).  The item in question is an 
Agilent gas chromatograph exported to Koon Yue on 
or about April 3, 2007 and valued at USD 17,452. 
On the applicable shippers export declaration 
(SED), the item is classified as 3A999.  Items 
properly classified as 3A999 may be 
exported/reexported to virtually all destinations 
and end-users worldwide, license free, except for 
certain designated state sponsors of terrorism 
(including North Korea).  The exporter was Agilent 
Technologies Inc. of New Castle, Delaware. 
 
¶3.  According to the Hong Kong Inland Revenue 
Department Business Registration Office, Koon Yue 
has been in existence since 1992.  It is a sole 
proprietorship (and is therefore not listed in the 
Hong Kong Companies Registry) and its owner is 
listed as Hong Kong identity card holder, Ching 
Wing Chau.  The Hong Kong Trade and Development 
Council lists the company's areas of business as 
including trading and manufacturing of 
electronic/electrical components and accessories. 
 
¶4.  On June 7, 2007, the ECO met with Mr. Victor 
Chau, Director.  ECO had been attempting to 
schedule a meeting with Mr. Chau for some time but 
according to his assistant, Mr. Chau had been 
unavailable as he was traveling in mainland China. 
Mr. Chau stated that Koon Yue is a trading company 
but also does its own production of various 
electronic parts and components in Shenzhen, 
mainland China.  It was apparent to ECO that no 
production occurs at Koon Yue's location in Hong 
Kong. 
 
¶5.  As to the specific item in question, Mr. Wong 
provided copies of the relevant shipping documents 
showing that the item had been received in Hong 
Kong and was subsequently shipped to mainland 
China.  The purchaser on the applicable 
documentation was listed as Shanghai Weiye Import 
Export Company.  Mr. Wong did not know the name of 
the end user of the item.  He noted that his 
buyers are often unwilling to disclose the end 
user as they are concerned that he may approach 
their customer directly.  During the meeting, Mr. 
Wong offered to call his customer to obtain 
information about the end user.  After talking on 
the phone, apparently with a representative of 
Shanghai Weiye Import Export Company, Mr. Wong 
stated that the name of the buyer of the item is 
Shanghai Yinming Industrial Company Limited.  That 
name did not appear on the shipping and ordering 
documentation Mr. Wong provided to ECO (neither 
did Shanghai Weiye Import Export Company).  When 
asked by the ECO why the transaction was routed 
through Hong Kong, Mr. Wong stated that such route 
was advantageous from a mainland China tax 
perspective. 
 
¶6.  At the time visited, Koon Yue appeared to be a 
suitable recipient of the commodities shipped (as 
reseller) since Koon Yue cooperated with the PSV 
and provided all requested information concerning 
the final disposition of the applicable items.  At 
the same time, the ECO was not able to inspect the 
subject items as they had already been delivered 
to Koon Yue's customer.  Consistent with guidance 
on reporting of PSVs where the items cannot be 
physically inspected, the ECO recommends that this 
PSV be classified as Limited. 
 
Cunningham