VZCZCXYZ0001
PP RUEHWEB

DE RUEHIN #0128 0280630
ZNR UUUUU ZZH
P 280630Z JAN 08
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC PRIORITY 7996
INFO RUEAIIA/CIA WASHDC
RUCPDOC/USDOC WASHDC
RUEKJCS/SECDEF WASHINGTON DC
RHMCSUU/FBI WASHINGTON DC
RUEPINS/HQ BICE INTEL WASHINGTON DC

UNCLAS AIT TAIPEI 000128 
 
SIPDIS 
 
STATE FOR EAP/TC, PM/DTCC AND ISN/MTR 
STATE PASS TO AIT/W 
 
PM/DTCC FOR BLUE LANTERN COORDINATOR RACHAEL-THERESE JOUBERT-LIN 
 
SENSITIVE 
SIPDIS 
 
FROM AIT KAOHSIUNG BRANCH OFFICE 
 
E.O. 12958: N/A 
TAGS: ETTC KOMC TW
SUBJECT: TAIWAN: RESULTS OF BLUE LANTERN PRE-LICENSE END-USE CHECK 
05-050080535 
 
REF: A. STATE 001652 B. Taipei 01137 
 
¶1.  (SBU) Per reftel A request, AIT Kaohsiung visited Yeou Zheng Co. 
and a residential space used as a warehouse in downtown Kaohsiung, 
and interviewed the company's owner, Ms. Chen Mei-liu and other 
staff.  AIT/K also conducted two telephone interviews with 
Lieutenant Commander Liang Dao-hung, who is responsible procurement 
of commodities for the Ma Kung Naval Base's Taiwan Logistics 
Supporting Command (TLSC). 
 
¶2.  (SBU) Yeou Zheng owner, Chen Mei-liu, told AIT/K that her family 
owns three separate companies that supply goods to the Ma Kung Naval 
Base.  The three companies are: Yeou Kang which focuses on computer 
wiring installation for the Ma Kung Navy; Yeou Zheng Industry, which 
supplies the navy's general hardware Industry; and Yeou Zheng Co., 
which supplies the navy with consumer goods.  According to Chen, her 
family has been doing business with the Ma Kung Naval Base for more 
than 30 years, starting with her father-in-law.  Chen and her staff 
(Hung Yang-chun and Jill Hung) all claim familiarity with U.S. 
restrictions on the procurement of US Munitions List commodities. 
 
¶3.  (SBU) Chen admitted to us that Yeou Zheng has not yet received 
an order for the antenna indicated on reftel A, nor has the navy put 
out a tender for bids on the item; however, she said that she and 
her staff are very familiar with the naval base's supply needs and 
she expects the base to request those antennas within a few months, 
if not weeks.  To recap, the order for 11 (eleven) pieces of 
AS-1729/VRC Antennas are not for any current contract; rather, Yeou 
Zheng anticipates the base will need the antennas for future repairs 
that are due in 2008.  Chen went on to say that when it places 
orders, the Navy expects to take delivery of the goods within 60 
days.  However, Yeou Zheng's U.S. suppliers need 180 to 300 days 
before they can deliver goods to Yeou Zheng in Taiwan.  In order to 
meet the Taiwan navy's 60 day delivery requirement, Yeou Zheng 
orders goods in advance of even receiving a request for bids. 
 
¶4.  (SBU) Chen said Yeou Zheng supplied a total of 23 (twenty-three) 
AS-1729/VRC Antennas (in three separate orders/contracts) to the Ma 
Kung Naval Base in 2007.  Yeou Zheng faxed copies of the three 
contracts to AIT/K which showed the contracts were granted in 2007 
on June 14, August 21, and October 23 respectively.  Lieutenant 
Commander Liang confirmed that the Ma Kung Naval Base procured the 
23 AS-1729 VCR antennas (with NSN number 5985-00-985-9024) from Yeou 
Zheng to use during the second half of 2007.  The Navy supplied the 
antennas to two naval vessels and gave the remainder to three other 
Navy offices.  Liang confirmed that the Navy typically allows 
winning bidders up to 50 days to deliver ordered goods.  Liang told 
AIT/K that Yeou Zheng is a key supplier for the Ma Kung Naval Base. 
Liang stressed that he believes Yeou Zheng to be a reliable company. 
 Liang said the Navy has not yet determined its 2008 procurement 
plan, so he cannot confirm which items they will require in coming 
weeks and months.  He also could not confirm that Yeou Zheng would, 
in the end, submit the winning bid. 
 
¶5.  (SBU) Yeou Zheng's office is reasonably secure, with 
closed-circuit television cameras monitoring the outer perimeters, 
the first-floor entrance from the interior, and the first-floor 
staircase leading to the upper floors; rolling metal gates secure 
the street-level front entrance and the doors that open to the 
balcony areas.  A roof-top door stainless steel door is secured with 
a padlock.  The office is on the bottom floor of the building.  The 
remaining four floors are used as residential space, save for a 
fourth floor room that serves as the company's warehouse.  Again, 
the building appears to be sufficiently secure. 
 
 
Thiele 
 
 
Young