VZCZCXYZ0020
PP RUEHWEB

DE RUEHKO #0328/01 0500744
ZNR UUUUU ZZH
P 190744Z FEB 10
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 9490
INFO RUEAIIA/CIA WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC PRIORITY
RHMFIUU/FBI WASHINGTON DC PRIORITY
RHEHAAA/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY
RUEATRS/TREASURY DEPT WASHDC PRIORITY
RHMFIUU/HQ BICE WASHINGTON DC PRIORITY

UNCLAS TOKYO 000328 
 
SENSITIVE 
SIPDIS 
 
PM/DTCC BLUE LANTERN COORDINATOR 
 
E.O. 12958: N/A 
TAGS: ETTC KOMC JA
SUBJECT: RESPONSE FOR BLUE LANTERN LEVEL 3:  POST-SHIPMENT 
END-USE CHECK ON LICENSES 050102957 
 
REF: STATE 1514 
 
¶1.  (SBU) Post submits the following information in response 
to reftel inquiry.  On January 20, Econoff conducted a site 
visit and met with Mr. Tsuneo TAKEDA, President of Sky 
Trading Co., Ltd.  Takeda produced documentation (Japan 
Ministry of Defense (MOD) receipts) to verify the following 
eight shipments: 
(I) Shipment dated July 2, 2008, contained three valves and 
pressure equalizers.  Delivered to Japan Air Self Defense 
Force (JASDF) 2nd Depot on July 9, 2008 
(II) Shipment dated July 6, 2008, contained 40 valves. 
Delivered to JASDF 2nd Depot on July 17, 2008/ 
(III) Shipment dated August 31, 2008, contained 23 valves and 
one relay.  Delivered to JASDF 2nd Depot on September 11, 2008 
(IV) Shipment dated October 8, 2008, contained five valves 
and 25 switch and P/B assy.  Delivered to JASDF 2nd Depot on 
October 16, 2008. 
(V) Shipment dated January 24, 2009, contained 136 gauges, 64 
valves, and 72 check valves.  Delivered to JASDF 2nd Depot on 
February 5, 2009. 
(VI) Shipment dated April 22, 2009, contained 10 valves. 
Delivered to JASDF 1st Depot on June 2, 2009. 
(VII) Shipment dated May 9, 2009, contained 131 gauges, 50 
valves, and 77 check valves.  Delivered to JASDF 2nd Depot on 
May 21, 2009. 
(VIII) Shipment dated October 3, 2009, contained 131 gauges. 
Delivered to JASDF 2nd Depot via Sumitomo Precision Products 
Co., Ltd. (http://www.spp.co.jp/English/index2-e.html).  The 
goods were delivered to Sumitomo Precision on October 26, 
¶2009.  Sumitomo Precision will use these gauges for High 
Assy. repairs under a separate contract with MOD.  MOD 
officials verified that the final products are to be 
delivered to JASDF 2nd Depot. 
 
¶2.  (SBU) All information concerning shipments was confirmed 
via e-mail on February 17 by MOD official, Mr. Teramoto of 
the Equipment Policy Division.  The receipts did not 
indicated the dollar value of the goods, but Econoff verified 
that the amount in the invoices from Trans-Pac Sales Corp. 
matched the values indicated in the shipping records supplied 
by Department.  Econoff further verified all contracts 
between Sky Trading and MOD for these shipments. 
 
¶3.  (SBU) Sky Trading used Kawasaki Kisen, also known as 
K-line (http://www.kline.co.jp/index e.html), as its 
exclusive shipping company for these goods.  Takeda explained 
that when they receive the goods from the United States, they 
tend to keep the bulk of the goods at the K-line facility at 
the airport.  If it is a small amount, however, they store it 
in their office.  The length of time such goods are stored at 
the office depends of the scheduling of inspection.  Before 
they can deliver the goods to the end-user, officials from 
the end-user come to their office to inspect the goods.  This 
can take up to two weeks.  Once goods clear inspection, they 
are shipped by truck to the relevant end-user. 
 
¶4.  (SBU) The company is housed in a small one-room office in 
a small office building in a mixed use district.  Sky Trading 
employs a security system that detects any changes in room 
temperature caused by the entry of a person.  Any change in 
temperature causes a security guard to be notified.  Takeda 
said there have been no incidents of theft. 
 
¶5.  (SBU) Takeda said his company has never stockpiled any 
military items in their office or elsewhere.  He further 
stated the company never imports goods for the purpose of 
stockpiling.  They only place orders with suppliers when they 
have a request from an end-user, he explained.  Takeda did 
say, however, that the several years could pass between the 
date of contract with the MOD and the actual delivery of the 
desired goods.  He said the Non-Transfer and Use Certificate 
(DSP-83) covers several contracts.  Takeda is aware that the 
license is only valid for four years and understands the need 
to apply for a new license should the current one expire 
before receiving all the goods included in the value of this 
license. 
 
¶6.  (SBU) COMMENT.  At this point, Embassy Tokyo recommends 
no further follow-up action.  The transactions undertaken by 
Sky Trading appear, as far as we can tell, legitimate.  They 
have been confirmed by the MOD.  Sky Trading's behavior and 
 
explanations indicate an understanding of the regulations 
governing the handling of USML items.  END COMMENT. 
ROOS