VZCZCXYZ0005
RR RUEHWEB

DE RUEHHK #0239/01 0400217
ZNR UUUUU ZZH
R 090217Z FEB 09
FM AMCONSUL HONG KONG
TO RUCPDOC/USDOC WASHDC
INFO RUEHC/SECSTATE WASHDC 6842
RHMFIUU/HQ BICE WASHINGTON DC

UNCLAS HONG KONG 000239 
 
USDOC FOR 532/OEA/MNICKSON/ADYSON/TWILLIS/EHOLLAND 
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: PRE LICENSE CHECK: GEO MARINE INSTRUMENT 
COMPANY 
 
REF: A) D409956 B) USDOC 00093 C) USDOC 00091 D) D409631 
 
 
¶1. Unauthorized disclosure of the information provided below is 
prohibited by Section 12C of the Export Administration Act. 
 
¶2. 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 two pre-license checks (PLCs) 
at Geo Marine Instrument Company, Rm 1019, New Commerce Ctr., 19 On 
Sum St., Shatin, Hong Kong (Geo Marine).  The items that are the 
subject of the first check (and BIS license application D 409631) 
are two TR-1075D transducer assays, while the second set of items 
(that are the subject of BIS license application D409956) are 1500 
passive acceleration compensated hydrophones rated to 2000M.  These 
items are classified under export control classification number 
(ECCN) 6A001 and are controlled for national security reasons (NS). 
The license applicants are Teledyne Benthos of North Falmouth, 
Massachusetts and Massa Products Corporation of Hingham 
Massachusetts. 
 
¶3.  According to the Hong Kong Companies Registry, Geo Marine 
Technology Limited was incorporated in May 2002.  Its paid in share 
capital is the Hong Kong dollar equivalent of USD 1250.  Its 
directors are listed as Hong Kong residents So, Hay Wah (HK 
Identification number C515318) and Tse, Fung Ping (HK Identification 
number G262458(2).  Its website is www.geo-marine-tech.com.cn. 
 
¶4.  On February 2, 2009, ECO visited Geo Marine and met with Mr. 
Janson So, General Manager. The offices of Geo Marine in Hong Kong 
are quite small (no more than 200 square feet).  It appears that two 
to four staff work at this location which appears to act as both 
offices and a small warehouse for items shipped to Geo Marine.  Mr. 
So stated that the company's business is focused on the provision of 
products and total solutions related to underwater surveying and 
marine engineering.  A key portion of that business serves the oil 
and gas exploration business.  Mr. So stated that Geo Marine also 
acts as a distributor to surveyors in Hong Kong and China and also 
sells geophysical equipment (such as hydrophones for conducting 
surveys of the sea floor).  The company has additional offices in 
mainland China. 
 
¶5.  As to the hydrophones that are the subject of BIS license 
application D409956, Mr. So stated that the buyer is BGP 
International China, a subsidiary of the China National Petroleum 
Company (CNPC)  He stated that the hydrophones are destined to 
replace existing Bentos hydrophones on cables used in ocean bottom 
analysis and exploration. 
 
¶6.  As to the transducers that were the subject of BIS license 
D409631, Mr. So stated that they are destined for the First 
Institute of Oceanography State Oceanic Administration in Qingdao, 
mainland China.  He provided a copy of the purchase contract for the 
item (and other related items).  The contract lists Qingdao Bondex 
Trade Service Co. Ltd. as the buyer's agent for this transaction. 
Mr. So stated that the institute is involved in geophysics related 
activities and specializes in study of the sea floor.  In 
particular, he stated that one of the transducers would be used in 
shallow water sea bed engineering studies while a second would be 
used for oceanographic study.  He stated that the Institute had been 
buying this particular item through other resellers for many years. 
Mr. So further explained that the Institute provides similar 
services as survey consultants to major western engineering 
projects.  In China, Mr. So stated, those services are provided by 
state organizations. 
 
¶7.  Mr. So was well versed in export controls and stated that his 
company obtains licenses from the Hong Kong government for import 
(and subsequent reexport) of strategic commodities.  He stated 
(correctly) that the Hong Kong government will not grant him a 
license to import items when no corresponding U.S. export license 
has been obtained.  Mr. So also stated that, from time to time, he 
receives e-mail inquiries from potential customers outside of his 
geographic region.  He stated that he forwards those to his 
suppliers and does not serve customers outside of Hong Kong and 
China.  Mr. So stated that in his line of business, there are 
relatively few buyers and that he is familiar with most of them.  It 
was clear to ECO that Mr. So is not keen to jeopardize his business 
by selling to unknown buyers that approach him through the 
internet. 
 
¶8.  It appears that another company uses this same address, namely 
United Star Navigation.  When asked about this company, Mr. So was 
quite open and stated that this company is a mainland based reseller 
of lighthouse and navigation related products.  It has registered a 
company in Hong Kong to take advantage of transfer pricing to 
minimize taxes (the likely web site is usnt.com.cn).  According to 
the Hong Kong Companies registry, this company has been in existence 
 
 
since 1997 and has less than the Hong Kong equivalent of USD 10 in 
share capital.  Its directors are listed as mainland nationals Chen, 
Ya Bin (passport or ID number 120103630407211), Ding, Yue (passport 
or ID number 110108197308076313), Jiang, Yaqun (passport number or 
ID 110228630705211), Lin, Yu Nai (passport or ID number 
370202391206353 and Peng, Hai (passport or ID number 
110102660604041),  and Hong Kong resident Man, Ka Fai Johnny (Hong 
Kong ID D238430(3).  While ECO has no additional information about 
this company, ECO notes that this tax optimization mechanism is not 
uncommon in Hong Kong. 
 
¶9.  Based on the information noted above, ECO believes that Geo 
Marine is a suitable recipient of U.S. origin controlled technology, 
as reseller and system integrator. ECO has not independently 
reviewed the bona fides of the company or individuals referenced in 
paragraph 8.  To the degree BIS has derogatory information about 
United Star Navigation or its directors, BIS may wish to reevaluate 
this favorable review of Geo Marine.