VZCZCXYZ0001
RR RUEHWEB

DE RUEHHK #2274 3540857
ZNR UUUUU ZZH
R 190857Z DEC 08
FM AMCONSUL HONG KONG
TO RUCPDOC/USDOC WASHDC
INFO RUEHC/SECSTATE WASHDC 6485
RUEAIAO/HQ ICE IAO WASHDC

UNCLAS HONG KONG 002274 
 
USDOC FOR 532/OEA/LHINES/ADYSON 
USDOC FOR 3132 FOR FCS/OIO REGIONAL DIRECTOR PATRICK SANTILLO 
BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: BMGT BEXP HK ETRD ETTC
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION: EVA HSIAO/EDOM 
TECHNOLOGY CO 
 
REF: A) USDOC 06828 
 
 
¶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 (PSV) at Eva Hsiao, Edom Technology 
Co., 9/F, Kian Dai Industrial Bldg., 73-75 Hung To Road, Kwun Tong, 
Kowloon (Edom). The item in question is a Neomagic Nimagin 8 Stander 
Development Kit (NM9800MDB) exported to Edom on or about July 29, 
2008 and valued at USD 4500.  On the applicable shippers export 
declaration (SED), these items are classified under export control 
classification number (ECCN) 3A001 and, if properly classified, 
would be controlled for national security (NS) reasons.  Based on a 
review of export documentation provided by Neomagic, ECO believes 
this item could likely be exported or reexported to mainland China 
pursuant to license exception CIV if destined for civil end use. 
The exporter was Neomagic Corporation of Santa Clara, California. 
 
¶3.  According to the Hong Kong Companies Registry, Edom was 
registered in August 2000.  According to the Companies Registry, it 
has no paid-in capital. Its directors are listed as Cheng, Duen 
Chian, Lin Fei Hong, Tseng, Yu I, Wang, Le Chun and Zhang, Jie with 
the following Taiwan passport numbers:  211090898, M20117908, 
M10232707, 210273989 and X00800892. 
 
¶4.  According to the company web site (www.edom-tech.com), Edom is 
an integrated circuits distributor with particular focus on the 
information, communication and consumer electronics markets.  It has 
offices in Hong Kong, Taipei, Shenzhen, Xiamen, Penang, Beijing and 
Shanghai.  Its headquarters are in Taipei. 
 
¶5.  On December 3, 2008, ECO and Commercial Assistant Carrie Chan 
visited Edom at the address listed above and met with Stone Li, 
Senior Sales Engineer.  He provided additional information on the 
various types of products that Edom distributes.  These include 
integrated circuits, microcontroller units, DRAM memory among other 
products.  Li stated that products shipped to Hong Kong are destined 
approximately 90 percent for mainland China and 10 percent for Hong 
Kong.  He also stated that it is Edom's policy that China customers 
must arrange for pickup from Edom in Hong Kong.  Edom will not ship 
to the mainland.  Li showed ECO Edom's warehouse space.  ECO 
estimates that the company's warehouse space totaled roughly 2000 
square feet. The space was filled with boxes destined for delivery 
to mainland China.  Li stated that he is the only Edom sales 
engineer located in Hong Kong. The remaining sales engineers and 
staff are located in the mainland or at other Edom locations.  In 
addition, Li stated that Edom is not an electronics broker but 
rather acts as distributor for a fixed number of manufacturers. 
 
¶6.  As to the particular item in question, Li stated that it had 
been ordered by Edom to be used as a testing unit by its customer RV 
Technology Limited (www.rvtec.com) (RV Tech).  RV Tech was using the 
unit to develop a smart phone. Edom lent the unit to RV Tech and Li 
stated that Edom had obtained the unit back from its customer. ECO 
reviewed the item and notes Serial Number MDB06120035.  Li stated 
that loaners are used in this way to spur potential future sales of, 
for example, Neomagic products.  Li volunteered that Neomagic is 
doing poorly and that Edom rarely receives orders for Neomagic 
products. 
 
¶7.  ECO asked Li whether Edom applies for applicable Hong Kong 
licenses for the products it imports and resells.  After a pause, Li 
stated that Edom applies for all required licenses.  When asked 
about Edom's mainland Chinese customers, Li stated that he expects 
that they understood the need to apply for licenses, as required. 
ECO suspects neither Edom nor its customers apply for required Hong 
Kong licenses nor for U.S. licenses (if required). 
 
¶8.  Based on the information noted above, ECO believes that Edom is 
an unsuitable recipient of U.S. origin controlled technology. While 
Edom might not have violated U.S. law in respect of this shipment, 
ECO suspects that is only because the item in question did not 
require a U.S. license in this particular instance.  ECO requests 
that OEA confirm the 3A001 classification of the applicable item so 
that ECO may reach out to Hong Kong TID concerning a potential 
violation of Hong Kong's export control rules in connection with 
this shipment.