VZCZCXYZ0001
RR RUEHWEB

DE RUEHHK #1044/01 1640142
ZNR UUUUU ZZH
R 120142Z JUN 08
FM AMCONSUL HONG KONG
TO RUCPDOC/USDOC WASHDC
INFO RUEHC/SECSTATE WASHDC 5055
RHMFIUU/HQ BICE WASHINGTON DC
RUEHGP/AMEMBASSY SINGAPORE 3874

UNCLAS HONG KONG 001044 
 
USDOC FOR 532/OEA/MNICKSON-DORSEY /GCARDAK 
USDOC FOR 3132 FOR FCS/OIO REGIONAL DIRECTOR WILLIAM ZARIT 
BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS 
SINGAPORE FOR FCS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: BMGT BEXP ETRD ETTC HK
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION: 
ACE PRESSUREWELD INTL 
 
REF: A) USDOC 01398 B) USDOC 01399 C) USDOC 01340 
 
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), Regional Export Control Officer Philip Ankel (ECO) 
conducted three post shipment-verifications (PSVs) at Ace 
Pressureweld Intl., 31 Senoko Loop, Singapore (ACE). The items in 
question are as follows: one three inch CP 5000 valve, 50 Leybold 
Dip 3000, 30 Diff-Therm Platen Htr., 30 Diff-Therm Platen Htr, 20 
studs, 25 shafts, 720 O rings, 20 diodes, 100 latches and 60 
modules.  The items were sent in three shipments on October 25, 
2007, August 15, 2007 and September 6, 2007.  The items are most 
likely not listed on the Commerce Control List (CCL) and are 
therefore likely classified as EAR99 meaning that they may be 
exported/reexported to virtually all destinations, end-users/uses 
except sanctioned countries and proliferation or prohibited 
end-uses/users. The exporters were Dalton Electric Heating of 
Ipswich, Massachusetts, World Bridge Corporation of Gardena, 
California and Maxon Corporation of Muncie, Indiana. 
 
¶3.  According to the Singapore companies registry, ACE was 
registered in 1973 and its registered share capital is the Singapore 
dollar equivalent of approximately USD 1.7 million.  Its directors 
are listed as Singapore citizens, Rocque Kaw Jit Khim (with 
Singapore ID S0234983C), Kwan Kai Phang Willy (with Singapore ID 
S0428041E) and Ong Moi Moi (with Singapore ID S1553451F).  Messirs 
Rocque Kaw Jit Khim and Kwan Kai Phang Willy are also the company's 
sole shareholders. 
 
¶4.  A review of the company's promotional materials on EC21 (a 
global B2B marketplace web site) reveals that the company markets 
itself has a leading engineering company that has diversified to 
become a distributor and trading house.  It offers EDM wires, metal 
plates, flanges, tubes, valves, drilling equipment, among others 
(http://aceweld.en.ec21.com).  The web information further states 
that the company has been supplying customers in Myanmar, Kuwait, 
India, Vietnam, Indonesia and Malaysia. 
 
¶5.  On April 22, 2008, the ECO, accompanied by a representative of 
Singapore Customs, visited the company and met with Ms. Jane Ang, 
Senior Manager, Ms. Nancy Ong, Executive Director and Mr. Willy 
Kwan, Chairman. Mr. Kwan provided an overview of the ACE's 
activities.  He stated that the company was established in 1973 as a 
engineering and machine shop for the oil and gas sector.  In the 
1980s, the company diversified and became a trading/sourcing 
company.  At the present time, the majority of its business is 
related to importing and exporting various spare parts for the oil 
and gas sector as well as for locomotive upgrades.  Its customers 
are in Myanmar, Indonesia, Australia, Europe, India and Vietnam.  It 
is also active in the pharmaceutical, paper and textiles sectors. 
The Singapore office represents primarily the back room operations 
of the company while sales are done overseas (ECO Note:  the meeting 
took place in a warehouse building under renovation in which there 
are roughly 20 desks staffed with ACE employees). 
 
¶6.  Mr. Kwan also described the ACE's joint venture with U.K. 
Company Romic Group (www.romic.co.uk).  The back of Mr. Kwan's 
business card lists the joint venture as Romic-Ace International 
Pte. Ltd.  Romic is involved in the refurbishment of railway 
locomotives on behalf of the Iranian national railway company.  A 
Mr. Hugo from Canada overseas the supervision of the overhaul work 
while a Mr. Robert Coleman of Romic signs the applicable agreements 
with Iran on behalf of Romic-Ace International Pte. Ltd.  In 
addition, Romic-Ace also supplies certain oil and gas parts to Iran 
although Mr. Kwan stated that the company does not receive many of 
these types of requests. 
 
¶7. ACE representatives provided information concerning the three 
shipments that are the subject of the PSVs.  As to the first 
shipment (exported on or about September 6, 2007), Mr. Kwan stated 
that these items (oil and gas equipment) has been shipped to 
Polyacryl Iran Corp. in Holland (apparent web site 
at:http://www.iran-export.com/ exporter/company/ 
polyacril/index.htm). ECO reviewed the Purchase Order (JIRAI-20081) 
and notes that it was signed by a Mr. Saghafian in Holland.  The 
items were shipped to Holland on September 27, 2008.  Mr. Kwan 
stated that an order for the items had been placed with the U.S. 
exporter's office in Singapore (Maxon).  Maxon is an occasional 
supplier and, according to Mr. Kwan, it did not know the final 
destination of the items when it supplied them to ACE. 
 
¶8.  As to the second shipment (from U.S. Exporter World Bridge), ACE 
representatives stated that these items were railway parts destined 
 
 
to Iran as part of a Romic-Ace service contract with Iranian 
railways. By subsequent e-mail, the company provided a Bill of 
Lading indicating shipment to consignee Bank Melli Iran, Hessabhaye 
Dowlati Branch, Tehran.  The notify address is listed as Iranian 
Islamic Republic Raiways, No 436, 4th Floor, Shahid, Kalantary Bldg. 
Railway SQ. 
 
¶9.  As to the third shipment (from U.S. Exporter Dalton Electric 
Heating Co., Inc.), ACE representatives stated that the buyer was 
Kath Associates (PVT) Ltd., 76-E Hill View Plaza, Blue Area, 
Islamabad, Pakistan.  ACE was unaware of the end-use of the items 
that were shipped on September 14, 2007.  ECO notes that the value 
of the shipment is listed as FOB Singapore USD 60,000 while the 
company apparently paid the supplier USD 11,489 for the items. 
 
¶10.  Mr. Kwan also provided the ECO with a letter from Singapore 
Customs dated July 12, 2007.  That letter makes reference to a 
meeting between ACE and Singapore Customs and proforma invoice 
Q7API-10229 dated April 12, 2007).  That letter states that the 
aluminium rods referenced in the proforma invoice may be controlled 
for export from Singapore and that an export license is likely 
required to export these rods.  Mr. Kwan stated that the company had 
cancelled this order.  ACE provided ECO with an Irrevocable 
Documentary Credit No.0394-40-18796 from the National Bank of 
Pakistan in reference of this shipment. 
 
¶11.  ECO talked with ACE representatives at length about U.S. export 
and reexport controls.  Company representatives affirmed their 
commitment to comply with U.S. export/reexport control rules.  ECO 
provided company representatives with extensive information about 
U.S. controls including links to the BIS web site's information on 
lists to check, the Commerce Control List, Know Your Customer 
Guidance, Export Management Systems as well as information about 
OFAC sanctions programs involving Myanmar and Iran. 
 
¶12.  At the time visited, ACE did not appear to be a suitable 
recipient of U.S. origin controlled items since it is likely that 
such items will be diverted to Iran or other potential buyers of 
concern.