Action Affecting Export Privileges; Philip Cheng, 59598-59599 [E8-23795]

Agencies

• DEPARTMENT OF COMMERCE
• Bureau of Industry and Security
• Industry and Security Bureau

[Federal Register Volume 73, Number 197 (Thursday, October 9, 2008)]
[Notices]
[Pages 59598-59599]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-23795]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Action Affecting Export Privileges; Philip Cheng

    In the Matter of: Philip Cheng, currently incarcerated at: 
Registration Number 10105-111 FCI, Terminal Island, Federal 
Correctional Institution, P.O. Box 3007, San Pedro, CA 90731; and 
with an address at: 7654 Peach Blossom Drive, Cupertino, CA 95014.

Order Denying Export Privileges

    On December 3, 2007, in the U.S. District Court for Northern 
District of California, Philip Cheng (``Cheng'') pled guilty to and was 
convicted of violating Section 38 of the Arms Export Control Act (22 
U.S.C. 2778 (2000)). Cheng pled guilty to willfully engaging in 
brokering activities in facilitating the export and transfer of defense 
articles and defense services, specifically the brokering of the export 
of thermal imaging and infrared technology controlled under 22 CFR 
121.1, Category XII(c), without having registered with and obtained the 
required authorization from the Department of State. Cheng was 
sentenced to 24 months imprisonment, followed by three years of 
supervised release, and ordered to pay a $50,000

[[Page 59599]]

fine and a $100.00 special assessment fee.
    Section 766.25 of the Export Administration Regulations (``EAR'' or 
``Regulations'') \1\ provides, in pertinent part, that ``[t]he Director 
of the Office of Exporter Services, in consultation with the Director 
of the Office of Export Enforcement, may deny the export privileges of 
any person who has been convicted of a violation of the [Export 
Administration Act (``EAA'')], the EAR, of any order, license or 
authorization issued thereunder; any regulation, license, or order 
issued under the International Emergency Economic Powers Act (50 U.S.C. 
170 1-1706); 18 U.S.C. 793, 794 or 798; section 4(b) of the Internal 
Security Act of 1950 (50 U.S.C. 783(b)), or section 38 of the Arms 
Export Control Act (22 U.S.C. 2778).'' 15 CFR 766.25(a); see also 
Section 11(h) of the EAA, 50 U.S.C. app. Sec.  2410(h). The denial of 
export privileges under this provision may be for a period of up to 10 
years from the date of the conviction. 15 CFR 766.25(d); see also 50 
U.S.C. app. Sec.  24 10(h). In addition, Section 750.8 of the 
Regulations states that the Bureau of Industry and Security's Office of 
Exporter Services may revoke any Bureau of Industry and Security 
(``BIS'') licenses previously issued in which the person had an 
interest in at the time of his conviction.
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    \1\ The Regulations are currently codified in the Code of 
Federal Regulations at 15 CFR Parts 730-774 (2008). The Regulations 
issued pursuant to the EAA, which is currently codified at 50 U.S.C. 
app. Sec.  2401-2420 (2000). Since August 21, 2001, the EAA 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 July 
23, 2008 (73 FR 43603, July 25, 2008), has continued the Regulations 
in effect under the International Emergency Economic Powers Act (50 
U.S.C. 1701-1706 (2000)).
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    I have received notice of Cheng's conviction for violating the 
AECA, and have provided notice and an opportunity for Cheng to make a 
written submission to BIS, as provided in Section 766.25 of the 
Regulations. I have received a submission from Cheng. Based upon my 
review and consideration of that submission, my consultations with 
BIS's Office of Export Enforcement, including its Director, and the 
facts available to BIS, I have decided to deny Cheng's export 
privileges under the Regulations for a period of eight years from the 
date of Cheng's conviction.
    Accordingly, it is hereby ordered:
    I. Until December 3, 2015, Philip Cheng, currently incarcerated at 
Registration Number 10105-111, FCI Terminal Island, Federal 
Correctional Institution, P.O. Box 3007, San Pedro, CA 90731, and with 
an address at: 7654 Peach Blossom Drive, Cupertino, CA 95014, and when 
acting for or on behalf of Cheng, his representatives, assigns, agents, 
or employees, (collectively referred to hereinafter 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.
    II. 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 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 which 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.
    III. After notice and opportunity for comment as provided in 
Section 766.23 of the Regulations, any other person, firm, corporation, 
or business organization related to Philip Cheng 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 if necessary to prevent evasion of the Order.
    IV. 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.
    V. This Order is effective immediately and shall remain in effect 
until December 3, 2015.
    VI. In accordance with Part 756 of the Regulations, Cheng may file 
an appeal of this Order with the Under Secretary of Commerce for 
Industry and Security. The appeal must be filed within 45 days from the 
date of this Order and must comply with the provisions of Part 756 of 
the Regulations.
    VII. A copy of this Order shall be delivered to Cheng. This Order 
shall be published in the Federal Register.

    Dated: September 29, 2008.
Bernard Kritzer,
Director, Office of Exporter Services.
 [FR Doc. E8-23795 Filed 10-8-08; 8:45 am]
BILLING CODE 3510-DT-M