In the Matter of: Jose Alberto Diaz Sanchez, President, Winter Aircraft Products SA, a/k/a Ruf S. Lopez SA; C/Ferrocarril 41; 1 DCHA 28045 Madrid, Spain, Respondent; Final Decision and Order, 29963-29965 [07-2677]
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Federal Register / Vol. 72, No. 103 / Wednesday, May 30, 2007 / Notices
Dated: May 1, 2007.
Joseph N. Ingolia,
Chief Administrative Law Judge.
[FR Doc. 07–2675 Filed 5–25–07; 8:45 am]
BILLING CODE 3510–DT–M
DEPARTMENT OF COMMERCE
Bureau of Industry and Security
[Docket No. 05–BIS–17]
In the Matter of: Jose Alberto Diaz
Sanchez, President, Winter Aircraft
Products SA, a/k/a Ruf S. Lopez SA; C/
Ferrocarril 41; 1 DCHA 28045 Madrid,
Spain, Respondent; Final Decision and
Order
sroberts on PROD1PC70 with NOTICES
This matter is before me upon a
Recommended Decision and Order of
the Administrative Law Judge (‘‘ALJ’’).
In a charging letter filed on September
12, 2005, the Bureau of Industry and
Security (‘‘BIS’’) alleged that
Respondent, Jose Alberto Diaz Sanchez,
(‘‘Diaz Sanchez’’), in his capacity as
President of Winter Aircraft Products
SA (‘‘Winter Aircraft’’), committed two
violations of the Export Administration
Regulations (currently codified at 15
CFR parts 730–774) (2007))
(‘‘Regulations’’) 1, issued under the
Export Administration Act of 1979, as
amended (50 U.S.C. app. §§ 2401–2420
(2000)) (the ‘‘Act’’).2 Specifically, the
charging letter alleged that between on
or about November 1, 2000, and on or
about November 17, 2000, Diaz Sanchez
took actions with intent to evade the
Regulations. Specifically, on or about
November 1, 2000, Diaz Sanchez, acting
through his company Winter Aircraft,
acquired aircraft parts, items subject to
the Regulations and classified under
Export Control Classification Number
(‘‘ECCN’’) 9A991, from U.S. suppliers
with intent to transship such items to
1 The violations charged occurred in 2000. The
Regulations governing the violations at issue are
found in the 2000 version of the Code of Federal
Regulations (15 CFR parts 730–774 (2000)). The
2007 Regulations establish the procedures that
apply to this matter.
2 From August 21, 1994, through November 12,
2000, the Act was in lapse. During that period, the
President, through Executive Order 12924, which
had been extended by successive Presidential
Notices, the last of which was August 3, 2000 (3
CFR, 2000 Comp. 397 (2001)), continued the
Regulations in effect under the International
Emergency Economic Powers Act (50 U.S.C. 1701–
1706 (2000)) (‘‘IEEPA’’). On November 13, 2000, the
Act was reauthorized and it remained in effect
through August 20, 2001. Since August 21, 2001,
the Act has been in lapse and the President, through
Executive Order 13222 of August 17, 2001 (3 CFR,
2001 Comp. 783 (2002)), which has been extended
by successive Presidential Notices, the most recent
being that of August 3, 2006 (71 FR 44,551 (August
7, 2006)), has continued the Regulations in effect
under IEEPA.
VerDate Aug<31>2005
19:13 May 29, 2007
Jkt 211001
Iran. Winter Aircraft failed to inform the
U.S. suppliers of the ultimate
destination of the items and, as such, no
license was obtained from the U.S.
Government for this transaction, as was
required by Section 746.7 of the
Regulations. On or about November 17,
2000, Winter Aircraft transshipped the
aircraft parts subject to the Regulations
to Iran. In taking these actions, Diaz
Sanchez committed one violation of
Section 764.2(h) of the Regulations.
The charging letter further alleged
that between on or about October 19,
2000, and on or about November 22,
2000, Diaz Sanchez took actions with
intent to evade the Regulations.
Specifically, on or about October 19,
2000, Diaz Sanchez, acting through his
company Winter Aircraft, acquired
aircraft parts, items subject to the
Regulations and classified under ECCN
9A991, from U.S. suppliers with intent
to transship such items to Iran. Winter
Aircraft failed to inform the U.S.
suppliers of the ultimate destination of
the items and, as such, no license was
obtained from the U.S. Government for
this transaction, as was required by
Section 746.7 of the Regulations. On or
about November 22, 2000, Winter
Aircraft transshipped the aircraft parts
to Iran. In taking these actions, Diaz
Sanchez committed one violation of
Section 764.2(h) of the Regulations.
In accordance with Section
766.3(b)(1) of the Regulations, on
September 12,2005, BIS mailed the
notice of issuance of the charging letter
by registered mail to Diaz Sanchez at his
last known address. The notice of
issuance of a charging letter was
received by Diaz Sanchez on or about
September 21, 2005. The record
establishes that BIS and Diaz Sanchez
engaged in several months of
correspondence regarding the matter,
and BIS counsel advised Diaz Sanchez
to file an answer to the charging letter.
To date, Diaz Sanchez has not filed an
answer to the charging letter with the
ALJ, as required by the Regulations.
In accordance with Section 766.7 of
the Regulations, BIS filed a Motion for
Default Order on March 20, 2007. This
Motion for Default Order recommended
that Diaz Sanchez be denied export
privileges for a period of ten years.
Under Section 766.7(a) of the
Regulations, ‘‘[f]ailure of the respondent
to file an answer within the time
provided constitutes a waiver of the
respondent’s right to appear,’’ and ‘‘on
BIS’s motion and without further notice
to the respondent, [the ALJ] shall find
the facts to be as alleged in the charging
letter.’’ Based upon the record before
him, the ALJ found Diaz Sanchez in
default.
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Fmt 4703
Sfmt 4703
29963
On May 1, 2007, the ALJ issued a
Recommended Decision and Order in
which he found that Diaz Sanchez
committed two violations of § 764.2(h).
The ALJ also recommended the penalty
of denial of export privileges for ten
years.
The ALJ’s Recommended Decision
and Order, together with the entire
record in this case, has been referred to
me for final action under Section 766.22
of the Regulations. I find that the record
supports the ALJ’s findings of fact and
conclusions of law. I also find that the
penalty recommended by the ALJ is
appropriate, given the nature of the
violations and the facts of this case, and
the importance of preventing future
unauthorized exports.
Based on my review of the entire
record, I affirm the findings of fact and
conclusions of law in the ALJ’s
Recommended Decision and Order.
Accordingly, it is therefore ordered,
First, that for a period of ten years
from the date of this Order, Jose Alberto
Diaz Sanchez, President, Winter Aircraft
Products SA, a/k/a Ruf S. Lopez SA, C/
Ferrocarril 41, 28045 Madrid, Spain,
and when acting for or on behalf of Diaz
Sanchez, his representatives, agents and
employees (hereinafter collectively
referred to as the ‘‘Denied Person’’), may
not, directly or indirectly, participate in
any way in any transaction involving
any commodity, software or technology
(hereinafter collectively referred to as
‘‘item’’) exported or to be exported from
the United States that is subject to the
Regulations, or in any other activity
subject to the Regulations, including,
but not limited to:
A. Applying for, obtaining, or using
any license, License Exception, or
export control document;
B. Carrying on negotiations
concerning, or ordering, buying,
receiving, using, selling, delivering,
storing, disposing of, forwarding,
transporting, financing, or otherwise
servicing in any way, any transaction
involving any item exported or to be
exported from the United States that is
subject to the Regulations, or in any
other activity subject to the Regulations;
or
C. Benefitting in any way from any
transaction involving any item exported
or to be exported from the United States
that is subject to the Regulations, or in
any other activity subject to the
Regulations.
Second, that no person may, directly
or indirectly, do any of the following:
A. Export or reexport to or on behalf
of the Denied Person any item subject to
the Regulations;
B. Take any action that facilitates the
acquisition or attempted acquisition by
E:\FR\FM\30MYN1.SGM
30MYN1
sroberts on PROD1PC70 with NOTICES
29964
Federal Register / Vol. 72, No. 103 / Wednesday, May 30, 2007 / Notices
the Denied Person of the ownership,
possession, or control of any item
subject to the Regulations that has been
or will be exported from the United
States, including financing or other
support activities related to a
transaction whereby the Denied Person
acquires or attempts to acquire such
ownership, possession or control;
C. Take any action to acquire from or
to facilitate the acquisition or attempted
acquisition from the Denied Person of
any item subject to the Regulations that
has been exported from the United
States;
D. Obtain from the Denied Person in
the United States any item subject to the
Regulations with knowledge or reason
to know that the item will be, or is
intended to be, exported from the
United States; or
E. Engage in any transaction to service
any item subject to the Regulations that
has been or will be exported from the
United States and that is owned,
possessed or controlled by the Denied
Person, or service any item, of whatever
origin, that is owned, possessed or
controlled by the Denied Person if such
service involves the use of any item
subject to the Regulations that has been
or will be exported from the United
States. For purposes of this paragraph,
servicing means installation,
maintenance, repair, modification or
testing.
Third, that after notice and
opportunity for comment as provided in
§ 766.23 of the Regulations, any person,
firm, corporation, or business
organization related to the Denied
Person by affiliation, ownership,
control, or position of responsibility in
the conduct of trade or related services
may also be made subject to the
provisions of this Order.
Fourth, that this Order does not
prohibit any export, reexport, or other
transaction subject to the Regulations
where the only items involved that are
subject to the Regulations are the
foreign-produced direct product of U.S.origin technology.
Fifth, that this Order shall be served
on the Denied Person and on BIS, and
shall be published in the Federal
Register. In addition, the ALl’s
Recommended Decision and Order,
except for the section related to the
Recommended Order, shall be
published in the Federal Register.
This Order, which constitutes the
final agency action in this matter, is
effective immediately.
VerDate Aug<31>2005
19:13 May 29, 2007
Jkt 211001
Dated: May 24, 2007.
Mark Foulon,
Acting Under Secretary of Commerce for
Industry and Security.
Recommended Decision and Order
On September 12, 2005, the Bureau of
Industry and Security, U.S. Department
of Commerce (BIS), issued a charging
letter initiating this administrative
enforcement proceeding against Jose
Alberto Diaz Sanchez, (‘‘Diaz Sanchez‘‘),
in his capacity as President of Winter
Aircraft Products SA (‘‘Winter
Aircraft’’). The charging letter alleged
that Diaz Sanchez committed two
violations of the Export Administration
Regulations (currently codified at 15
CFR Parts 730–774 (2006)) (the
‘‘Regulations’’) 1 issued under the
Export Administration Act of 1979, as
amended (50 U.S.C. app. 2401–2420
(2000)) (the ‘‘Act’’).2 In accordance with
§ 766.7 of the Regulations, BIS has
moved for the issuance of an Order of
Default against Diaz Sanchez as Diaz
Sanchez has failed to file an answer to
the allegations in the charging letter
issued by BIS within the time period
required by law.
A. Legal Authority for Issuing an Order
of Default
Section 766.7 of the Regulations states
that BIS may file a motion for an order
of default if a respondent fails to file a
timely answer to a charging letter. That
section, entitled Default, provides in
pertinent part:
Failure of the respondent to file an answer
within the time provided constitutes a waiver
of the respondent’s right to appear and
contest the allegations in the charging letter.
In such event, the administrative law judge,
on BIS’s motion and without further notice
to the respondent, shall find the facts to be
as alleged in the charging letter and render
an initial or recommended decision
containing findings of fact and appropriate
conclusions of law and issue or recommend
an order imposing appropriate sanctions.
1 The violations charged occurred in 2000. The
Regulations governing the violations at issue are
found in the 2000 version of the Code of Federal
Regulations (15 CFR Parts 730–774 (2000)). The
2006 Regulations establish the Procedures that
apply to this matter.
2 From August 21, 1994 through November 12,
2000, the Act was in lapse. During that period, the
President, through Executive Order 12,924, which
had been extended by successive Presidential
Notices, the last of which was August 3, 2000, 3
CFR, 2000 Comp. 397 (2001), continued the
Regulations in effect under the International
Emergency Economic Powers Act, 50 U.S.C. 1701—
1706 (2000) (‘‘IEEPA’’). On November 13, 2000, the
Act was reauthorized and it remained in effect
through August 20, 2001. Since August 21, 2001,
the Act has been in lapse and the President, through
Executive Order 13,222 of August 17, 2001, 3 CFR,
2001 Comp. 783 (2002), as extended by the Notice
of August 3, 2006, 71 FR 44551 (Aug. 7, 2006), has
continued the Regulations in effect under IEEPA.
PO 00000
Frm 00023
Fmt 4703
Sfmt 4703
15 CFR 766.7 (2006).
Pursuant to § 766.6 of the Regulations,
a respondent must file an answer to the
charging letter ‘‘within 30 days after
being served with notice of the issuance
of the charging letter’’ initiating the
proceeding.
B. Service of the Notice of Issuance of
Charging Letter
In this case, BIS served notice of
issuance of the charging letter in
accordance with 766.3(b )(1) of the
Regulations when it sent a copy of the
charging letter by registered mail to Diaz
Sanchez at his last known address on
September 12, 2005. BIS has submitted
evidence that establishes that this
charging letter was received by Diaz
Sanchez on or about September 21,
2005. In addition, BIS also received a
letter from Winter Aircraft, the company
of which Diaz Sanchez is President,
acknowledging receipt of the charging
letter on September 21, 2005. Further,
BIS and Winter Aircraft have engaged in
several months of correspondence
regarding the matter. BIS counsel has
advised Diaz Sanchez, through his
company Winter Aircraft, repeatedly to
file an answer to the charging letter with
the Administrative Law Judge (‘‘ALJ’’).
Diaz Sanchez has failed to file an
answer to the charging letter as required
by section 766.6 of the Regulations.
Accordingly, Diaz Sanchez is in default.
C. Summary of Violations Charged
The charging letter filed by BIS
included a total of two charges.
Specifically, the charging letter alleged
the following:
Charge 1 (15 CFR 764.2(h)—Engaging in a
Transaction With Intent To Evade the
Regulations)
Between on or about November 1, 2000,
and on or about November 17, 2000, Diaz
Sanchez took actions with intent to evade the
Regulations. Specifically, on or about
November 1, 2000, Diaz Sanchez, acting
through his company Winter Aircraff,
acquired aircraft parts, items subject to the
Regulations and classified under Export
Control Classification Number (‘‘ECCN’’)
9A991, from U.S. suppliers with intent to
transship such items to Iran. Winter Aircraft
failed to inform the U.S. suppliers of the
ultimate destination of the items and, as
such, no license was obtained from the U.S.
Government for this transaction, as was
required by Section 746.7 of the Regulations.
On or about November 17, 2000, Winter
Aircraft transshipped the aircraft parts
subject to the EAR to Iran with a substantial
markup in price. In taking these actions, Diaz
Sanchez committed one violation of Section
764.2(h) of the Regulations.
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Federal Register / Vol. 72, No. 103 / Wednesday, May 30, 2007 / Notices
Charge 2 (15 CFR 764.2(h)—Engaging in a
Transaction With Intent To Evade the
Regulations)
Between on or about October 19, 2000, and
on or about November 22, 2000, Diaz
Sanchez took actions with intent to evade the
Regulations. Specifically, on or about
October 19, 2000, Diaz Sanchez, acting
through his company Winter Aircraft,
acquired aircraft parts, items subject to the
Regulations and classified under ECCN
9A991, from U.S. suppliers with intent to
transship such items to Iran. Winter Aircraft
failed to inform the U.S. suppliers of the
ultimate destination of the items and, as
such, no license was obtained from the U.S.
Government for this transaction, as was
required by Section 746.7 of the Regulations.
On or about November 22, 2000, Winter
Aircraft transshipped the aircraft parts
subject to the EAR to Iran with a substantial
markup in price. In taking these actions, Diaz
Sanchez committed one violation of Section
764.2(h) of the Regulations.
D. Penalty Recommendation
[REDACTED SECTION]
E. Conclusion
Accordingly, I am referring this
Recommended Decision and Order to
the Under Secretary of Commerce for
Industry and Security for review and
final action for the agency, without
further notice to the Respondent, as
provided in § 766.7 of the Regulations.
Within 30 days after receipt of this
Recommended Decision and Order, the
Under Secretary shall issue a written
order affirming, modifying, or vacating
the Recommended Decision and Order.
See 15 CFR 766.22(c).
Dated: May 1, 2007.
The Honorable Joseph N. Ingolia,
Chief Administrative Law Judge.
[FR Doc. 07–2677 Filed 5–29–07; 8:45 a.m.]
BILLING CODE 3510–DT–M
DEPARTMENT OF COMMERCE
Bureau of Industry and Security
[Docket No. 05–BIS–15]
sroberts on PROD1PC70 with NOTICES
In the Matter of: Winter Aircraft
Products SA; a/k/a Ruf S. Lopez SA,
C/Ferrocarril 41, 1 DCHA, 28045
Madrid, Spain; Respondent; Final
Decision and Order
This matter is before me upon a
Recommended Decision and Order of
the Administrative Law Judge (‘‘ALJ’’).
In a charging letter filed on September
12, 2005, the Bureau of Industry and
Security (‘‘BIS’’) alleged that
Respondent, Winter Aircraft Products
SA (hereinafter ‘‘Winter Aircraft’’), also
known as Ruf S. Lopez SA., committed
two violations of the Export
VerDate Aug<31>2005
19:13 May 29, 2007
Jkt 211001
Administration Regulations (currently
codified at 15 CFR parts 730–774)
(2007)) (‘‘Regulations’’) 1, issued under
the Export Administration Act of 1979,
as amended (50 U.S.C. app. 2401–2420
(2000)) (the ‘‘Act’’).2 Specifically, the
charging letter alleged that between on
or about November 1,2000, and on or
about November 17, 2000, Winter
Aircraft took actions with intent to
evade the Regulations. Specifically, on
or about November 1, 2000, Winter
Aircraft acquired aircraft parts, items
subject to the Regulations and classified
under Export Control Classification
Number (‘‘ECCN’’) 9A991, from U.S.
suppliers with intent to transship such
items to Iran. Winter Aircraft failed to
inform the U.S. suppliers of the ultimate
destination of the items and, as such, no
license was obtained from the U.S.
Government for this transaction, as was
required by Section 746.7 of the
Regulations. On or about November 17,
2000, Winter Aircraft transshipped the
aircraft parts subject to the Regulations
to Iran. In taking these actions, Winter
Aircraft committed one violation of
Section 764.2(h) of the Regulations.
The charging letter further alleged
that between on or about October 19,
2000, and on or about November 22,
2000, Winter Aircraft took actions with
intent to evade the Regulations.
Specifically, on or about October 19,
2000, Winter Aircraft acquired aircraft
parts, items subject to the Regulations
and classified under ECCN 9A991, from
U.S. suppliers with intent to transship
such items to Iran. Winter Aircraft failed
to inform the U.S. suppliers of the
ultimate destination of the items and, as
such, no license was obtained from the
U.S. Government for this transaction, as
was required by Section 746.7 of the
Regulations. On or about November 22,
2000, Winter Aircraft transshipped the
aircraft parts subject to the Regulations
1 The violations charged occurred in 2000. The
Regulations governing the violations at issue are
found in the 2000 version of the Code of Federal
Regulations (15 CFR parts 730–774 (2000)). The
2007 Regulations establish the procedures that
apply to this matter.
2 From August 21, 1994, through November 12,
2000, the Act was in lapse. During that period, the
President, through Executive Order 12924, which
had been extended by successive Presidential
Notices, the last of which was August 3, 2000 (3
CFR, 2000 Comp. 397 (2001)), continued the
Regulations in effect under the International
Emergency Economic Powers Act (50 U.S.C. 1701—
1706 (2000)) (‘‘IEEPA’’). On November 13, 2000, the
Act was reauthorized and it remained in effect
through August 20, 2001. Since August 21, 2001,
the Act has been in lapse and the President, through
Executive Order 13222 of August 17, 2001 (3 CFR,
2001 Comp. 783 (2002)), which has been extended
by successive Presidential Notices, the most recent
being that of August 3, 2006 (71 FR 44,551 (August
7, 2006)), has continued the Regulations in effect
under IEEPA.
PO 00000
Frm 00024
Fmt 4703
Sfmt 4703
29965
to Iran. In taking these actions, Winter
Aircraft committed one violation of
Section 764.2(h) of the Regulations.
In accordance with Section
766.3(b)(1) of the Regulations, on
September 12, 2005, BIS mailed the
notice of issuance of the charging letter
by registered mail to Winter Aircraft at
its last known address. The notice of
issuance of a charging letter was
received by Winter Aircraft on or about
September 21, 2005. The file establishes
that BIS and Winter Aircraft engaged in
several months of correspondence
regarding the matter, and that BIS
counsel advised Winter Aircraft to file
an answer to the charging letter. To
date, however, Winter Aircraft has not
filed an answer to the charging letter
with the ALJ, as required by the
Regulations.
In accordance with Section 766.7 of
the Regulations, BIS filed a Motion for
Default Order on March 20, 2007. This
Motion for Default Order recommended
that Winter Aircraft be denied export
privileges under the Regulations for a
period of ten years. Under Section
766.7(a) of the Regulations, ‘‘[fJailure of
the respondent to file an answer within
the time provided constitutes a waiver
of the respondent’s right to appear,’’ and
‘‘on BIS’s motion and without further
notice to the respondent, [the ALJ] shall
find the facts to be as alleged in the
charging letter.’’ Based upon the record
before him, the ALJ found Winter
Aircraft in default.
On May 1, 2007, ALJ issued a
Recommended Decision and Order in
which he found that Winter Aircraft
committed two violations of Section
764.2(h). The ALJ also recommended
the penalty of denial of Winter Aircraft’s
export privileges for ten years.
The ALJ’s Recommended Decision
and Order, together with the entire
record in this case, has been referred to
me for final action under Section 766.22
of the Regulations. I find that the record
supports the ALJ’s findings of fact and
conclusions of law. I also find that the
penalty recommended by the ALJ is
appropriate, given the nature of the
violations and the facts of this case, and
the importance of preventing future
unauthorized exports.
Based on my review of the entire
record, I affirm the findings of fact and
conclusions of law in the ALJ’s
Recommended Decision and Order.
Accordingly, it is therefore ordered,
First, that for a period of ten years
from the date of this Order, Winter
Aircraft Product SA, a/k/a Ruf S. Lopez
SA, C/Ferrocarril 41, 28045 Madrid,
Spain, its successors and assigns, and
when acting for or on behalf of Winter
Aircraft, its representatives, agents and
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30MYN1
]]>Agencies
[Federal Register Volume 72, Number 103 (Wednesday, May 30, 2007)]
[Notices]
[Pages 29963-29965]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 07-2677]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
Bureau of Industry and Security
[Docket No. 05-BIS-17]
In the Matter of: Jose Alberto Diaz Sanchez, President, Winter
Aircraft Products SA, a/k/a Ruf S. Lopez SA; C/Ferrocarril 41; 1 DCHA
28045 Madrid, Spain, Respondent; Final Decision and Order
This matter is before me upon a Recommended Decision and Order of
the Administrative Law Judge (``ALJ'').
In a charging letter filed on September 12, 2005, the Bureau of
Industry and Security (``BIS'') alleged that Respondent, Jose Alberto
Diaz Sanchez, (``Diaz Sanchez''), in his capacity as President of
Winter Aircraft Products SA (``Winter Aircraft''), committed two
violations of the Export Administration Regulations (currently codified
at 15 CFR parts 730-774) (2007)) (``Regulations'') \1\, issued under
the Export Administration Act of 1979, as amended (50 U.S.C. app.
Sec. Sec. 2401-2420 (2000)) (the ``Act'').\2\ Specifically, the
charging letter alleged that between on or about November 1, 2000, and
on or about November 17, 2000, Diaz Sanchez took actions with intent to
evade the Regulations. Specifically, on or about November 1, 2000, Diaz
Sanchez, acting through his company Winter Aircraft, acquired aircraft
parts, items subject to the Regulations and classified under Export
Control Classification Number (``ECCN'') 9A991, from U.S. suppliers
with intent to transship such items to Iran. Winter Aircraft failed to
inform the U.S. suppliers of the ultimate destination of the items and,
as such, no license was obtained from the U.S. Government for this
transaction, as was required by Section 746.7 of the Regulations. On or
about November 17, 2000, Winter Aircraft transshipped the aircraft
parts subject to the Regulations to Iran. In taking these actions, Diaz
Sanchez committed one violation of Section 764.2(h) of the Regulations.
---------------------------------------------------------------------------
\1\ The violations charged occurred in 2000. The Regulations
governing the violations at issue are found in the 2000 version of
the Code of Federal Regulations (15 CFR parts 730-774 (2000)). The
2007 Regulations establish the procedures that apply to this matter.
\2\ From August 21, 1994, through November 12, 2000, the Act was
in lapse. During that period, the President, through Executive Order
12924, which had been extended by successive Presidential Notices,
the last of which was August 3, 2000 (3 CFR, 2000 Comp. 397 (2001)),
continued the Regulations in effect under the International
Emergency Economic Powers Act (50 U.S.C. 1701-1706 (2000))
(``IEEPA''). On November 13, 2000, the Act was reauthorized and it
remained in effect through August 20, 2001. Since August 21, 2001,
the Act has been in lapse and the President, through Executive Order
13222 of August 17, 2001 (3 CFR, 2001 Comp. 783 (2002)), which has
been extended by successive Presidential Notices, the most recent
being that of August 3, 2006 (71 FR 44,551 (August 7, 2006)), has
continued the Regulations in effect under IEEPA.
---------------------------------------------------------------------------
The charging letter further alleged that between on or about
October 19, 2000, and on or about November 22, 2000, Diaz Sanchez took
actions with intent to evade the Regulations. Specifically, on or about
October 19, 2000, Diaz Sanchez, acting through his company Winter
Aircraft, acquired aircraft parts, items subject to the Regulations and
classified under ECCN 9A991, from U.S. suppliers with intent to
transship such items to Iran. Winter Aircraft failed to inform the U.S.
suppliers of the ultimate destination of the items and, as such, no
license was obtained from the U.S. Government for this transaction, as
was required by Section 746.7 of the Regulations. On or about November
22, 2000, Winter Aircraft transshipped the aircraft parts to Iran. In
taking these actions, Diaz Sanchez committed one violation of Section
764.2(h) of the Regulations.
In accordance with Section 766.3(b)(1) of the Regulations, on
September 12,2005, BIS mailed the notice of issuance of the charging
letter by registered mail to Diaz Sanchez at his last known address.
The notice of issuance of a charging letter was received by Diaz
Sanchez on or about September 21, 2005. The record establishes that BIS
and Diaz Sanchez engaged in several months of correspondence regarding
the matter, and BIS counsel advised Diaz Sanchez to file an answer to
the charging letter. To date, Diaz Sanchez has not filed an answer to
the charging letter with the ALJ, as required by the Regulations.
In accordance with Section 766.7 of the Regulations, BIS filed a
Motion for Default Order on March 20, 2007. This Motion for Default
Order recommended that Diaz Sanchez be denied export privileges for a
period of ten years. Under Section 766.7(a) of the Regulations,
``[f]ailure of the respondent to file an answer within the time
provided constitutes a waiver of the respondent's right to appear,''
and ``on BIS's motion and without further notice to the respondent,
[the ALJ] shall find the facts to be as alleged in the charging
letter.'' Based upon the record before him, the ALJ found Diaz Sanchez
in default.
On May 1, 2007, the ALJ issued a Recommended Decision and Order in
which he found that Diaz Sanchez committed two violations of Sec.
764.2(h). The ALJ also recommended the penalty of denial of export
privileges for ten years.
The ALJ's Recommended Decision and Order, together with the entire
record in this case, has been referred to me for final action under
Section 766.22 of the Regulations. I find that the record supports the
ALJ's findings of fact and conclusions of law. I also find that the
penalty recommended by the ALJ is appropriate, given the nature of the
violations and the facts of this case, and the importance of preventing
future unauthorized exports.
Based on my review of the entire record, I affirm the findings of
fact and conclusions of law in the ALJ's Recommended Decision and
Order.
Accordingly, it is therefore ordered,
First, that for a period of ten years from the date of this Order,
Jose Alberto Diaz Sanchez, President, Winter Aircraft Products SA, a/k/
a Ruf S. Lopez SA, C/Ferrocarril 41, 28045 Madrid, Spain, and when
acting for or on behalf of Diaz Sanchez, his representatives, agents
and employees (hereinafter collectively referred to as the ``Denied
Person''), may not, directly or indirectly, participate in any way in
any transaction involving any commodity, software or technology
(hereinafter collectively referred to as ``item'') exported or to be
exported from the United States that is subject to the Regulations, or
in any other activity subject to the Regulations, including, but not
limited to:
A. Applying for, obtaining, or using any license, License
Exception, or export control document;
B. Carrying on negotiations concerning, or ordering, buying,
receiving, using, selling, delivering, storing, disposing of,
forwarding, transporting, financing, or otherwise servicing in any way,
any transaction involving any item exported or to be exported from the
United States that is subject to the Regulations, or in any other
activity subject to the Regulations; or
C. Benefitting in any way from any transaction involving any item
exported or to be exported from the United States that is subject to
the Regulations, or in any other activity subject to the Regulations.
Second, that no person may, directly or indirectly, do any of the
following:
A. Export or reexport to or on behalf of the Denied Person any item
subject to the Regulations;
B. Take any action that facilitates the acquisition or attempted
acquisition by
[[Page 29964]]
the Denied Person of the ownership, possession, or control of any item
subject to the Regulations that has been or will be exported from the
United States, including financing or other support activities related
to a transaction whereby the Denied Person acquires or attempts to
acquire such ownership, possession or control;
C. Take any action to acquire from or to facilitate the acquisition
or attempted acquisition from the Denied Person of any item subject to
the Regulations that has been exported from the United States;
D. Obtain from the Denied Person in the United States any item
subject to the Regulations with knowledge or reason to know that the
item will be, or is intended to be, exported from the United States; or
E. Engage in any transaction to service any item subject to the
Regulations that has been or will be exported from the United States
and that is owned, possessed or controlled by the Denied Person, or
service any item, of whatever origin, that is owned, possessed or
controlled by the Denied Person if such service involves the use of any
item subject to the Regulations that has been or will be exported from
the United States. For purposes of this paragraph, servicing means
installation, maintenance, repair, modification or testing.
Third, that after notice and opportunity for comment as provided in
Sec. 766.23 of the Regulations, any person, firm, corporation, or
business organization related to the Denied Person by affiliation,
ownership, control, or position of responsibility in the conduct of
trade or related services may also be made subject to the provisions of
this Order.
Fourth, that this Order does not prohibit any export, reexport, or
other transaction subject to the Regulations where the only items
involved that are subject to the Regulations are the foreign-produced
direct product of U.S.-origin technology.
Fifth, that this Order shall be served on the Denied Person and on
BIS, and shall be published in the Federal Register. In addition, the
ALl's Recommended Decision and Order, except for the section related to
the Recommended Order, shall be published in the Federal Register.
This Order, which constitutes the final agency action in this
matter, is effective immediately.
Dated: May 24, 2007.
Mark Foulon,
Acting Under Secretary of Commerce for Industry and Security.
Recommended Decision and Order
On September 12, 2005, the Bureau of Industry and Security, U.S.
Department of Commerce (BIS), issued a charging letter initiating this
administrative enforcement proceeding against Jose Alberto Diaz
Sanchez, (``Diaz Sanchez``), in his capacity as President of Winter
Aircraft Products SA (``Winter Aircraft''). The charging letter alleged
that Diaz Sanchez committed two violations of the Export Administration
Regulations (currently codified at 15 CFR Parts 730-774 (2006)) (the
``Regulations'') \1\ issued under the Export Administration Act of
1979, as amended (50 U.S.C. app. 2401-2420 (2000)) (the ``Act'').\2\ In
accordance with Sec. 766.7 of the Regulations, BIS has moved for the
issuance of an Order of Default against Diaz Sanchez as Diaz Sanchez
has failed to file an answer to the allegations in the charging letter
issued by BIS within the time period required by law.
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\1\ The violations charged occurred in 2000. The Regulations
governing the violations at issue are found in the 2000 version of
the Code of Federal Regulations (15 CFR Parts 730-774 (2000)). The
2006 Regulations establish the Procedures that apply to this matter.
\2\ From August 21, 1994 through November 12, 2000, the Act was
in lapse. During that period, the President, through Executive Order
12,924, which had been extended by successive Presidential Notices,
the last of which was August 3, 2000, 3 CFR, 2000 Comp. 397 (2001),
continued the Regulations in effect under the International
Emergency Economic Powers Act, 50 U.S.C. 1701--1706 (2000)
(``IEEPA''). On November 13, 2000, the Act was reauthorized and it
remained in effect through August 20, 2001. Since August 21, 2001,
the Act has been in lapse and the President, through Executive Order
13,222 of August 17, 2001, 3 CFR, 2001 Comp. 783 (2002), as extended
by the Notice of August 3, 2006, 71 FR 44551 (Aug. 7, 2006), has
continued the Regulations in effect under IEEPA.
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A. Legal Authority for Issuing an Order of Default
Section 766.7 of the Regulations states that BIS may file a motion
for an order of default if a respondent fails to file a timely answer
to a charging letter. That section, entitled Default, provides in
pertinent part:
Failure of the respondent to file an answer within the time
provided constitutes a waiver of the respondent's right to appear
and contest the allegations in the charging letter. In such event,
the administrative law judge, on BIS's motion and without further
notice to the respondent, shall find the facts to be as alleged in
the charging letter and render an initial or recommended decision
containing findings of fact and appropriate conclusions of law and
issue or recommend an order imposing appropriate sanctions.
15 CFR 766.7 (2006).
Pursuant to Sec. 766.6 of the Regulations, a respondent must file
an answer to the charging letter ``within 30 days after being served
with notice of the issuance of the charging letter'' initiating the
proceeding.
B. Service of the Notice of Issuance of Charging Letter
In this case, BIS served notice of issuance of the charging letter
in accordance with 766.3(b )(1) of the Regulations when it sent a copy
of the charging letter by registered mail to Diaz Sanchez at his last
known address on September 12, 2005. BIS has submitted evidence that
establishes that this charging letter was received by Diaz Sanchez on
or about September 21, 2005. In addition, BIS also received a letter
from Winter Aircraft, the company of which Diaz Sanchez is President,
acknowledging receipt of the charging letter on September 21, 2005.
Further, BIS and Winter Aircraft have engaged in several months of
correspondence regarding the matter. BIS counsel has advised Diaz
Sanchez, through his company Winter Aircraft, repeatedly to file an
answer to the charging letter with the Administrative Law Judge
(``ALJ''). Diaz Sanchez has failed to file an answer to the charging
letter as required by section 766.6 of the Regulations. Accordingly,
Diaz Sanchez is in default.
C. Summary of Violations Charged
The charging letter filed by BIS included a total of two charges.
Specifically, the charging letter alleged the following:
Charge 1 (15 CFR 764.2(h)--Engaging in a Transaction With Intent To
Evade the Regulations)
Between on or about November 1, 2000, and on or about November
17, 2000, Diaz Sanchez took actions with intent to evade the
Regulations. Specifically, on or about November 1, 2000, Diaz
Sanchez, acting through his company Winter Aircraff, acquired
aircraft parts, items subject to the Regulations and classified
under Export Control Classification Number (``ECCN'') 9A991, from
U.S. suppliers with intent to transship such items to Iran. Winter
Aircraft failed to inform the U.S. suppliers of the ultimate
destination of the items and, as such, no license was obtained from
the U.S. Government for this transaction, as was required by Section
746.7 of the Regulations. On or about November 17, 2000, Winter
Aircraft transshipped the aircraft parts subject to the EAR to Iran
with a substantial markup in price. In taking these actions, Diaz
Sanchez committed one violation of Section 764.2(h) of the
Regulations.
[[Page 29965]]
Charge 2 (15 CFR 764.2(h)--Engaging in a Transaction With Intent To
Evade the Regulations)
Between on or about October 19, 2000, and on or about November
22, 2000, Diaz Sanchez took actions with intent to evade the
Regulations. Specifically, on or about October 19, 2000, Diaz
Sanchez, acting through his company Winter Aircraft, acquired
aircraft parts, items subject to the Regulations and classified
under ECCN 9A991, from U.S. suppliers with intent to transship such
items to Iran. Winter Aircraft failed to inform the U.S. suppliers
of the ultimate destination of the items and, as such, no license
was obtained from the U.S. Government for this transaction, as was
required by Section 746.7 of the Regulations. On or about November
22, 2000, Winter Aircraft transshipped the aircraft parts subject to
the EAR to Iran with a substantial markup in price. In taking these
actions, Diaz Sanchez committed one violation of Section 764.2(h) of
the Regulations.
D. Penalty Recommendation
[REDACTED SECTION]
E. Conclusion
Accordingly, I am referring this Recommended Decision and Order to
the Under Secretary of Commerce for Industry and Security for review
and final action for the agency, without further notice to the
Respondent, as provided in Sec. 766.7 of the Regulations.
Within 30 days after receipt of this Recommended Decision and
Order, the Under Secretary shall issue a written order affirming,
modifying, or vacating the Recommended Decision and Order. See 15 CFR
766.22(c).
Dated: May 1, 2007.
The Honorable Joseph N. Ingolia,
Chief Administrative Law Judge.
[FR Doc. 07-2677 Filed 5-29-07; 8:45 a.m.]
BILLING CODE 3510-DT-M
