Order Temporarily Denying Export Privileges, 4271-4276 [2020-01118]

Agencies

• DEPARTMENT OF COMMERCE
• Bureau of Industry and Security

[Federal Register Volume 85, Number 16 (Friday, January 24, 2020)]
[Notices]
[Pages 4271-4276]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-01118]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


Order Temporarily Denying Export Privileges

Muhammad Kamran Wali, 1st Floor, Jahanzeb Center, Bank Road, Saddar, 
Rawalpindi, Pakistan
Muhammad Ahsan Wali, 4453 Weeping Willow Drive, Mississauga, 
Ontario, Canada
Haji Wali Muhammad Sheikh, 4453 Weeping Willow Drive, Mississauga, 
Ontario, Canada
Ahmed Waheed, 143 Wards Road, Ilford, Essex, United Kingdom
Ashraf Khan Muhammad, M/F 20 Pei Ho Street, Sham Shui Po, Kowloon, 
Hong Kong
Business World, 1st Floor, Jahanzeb Center, Bank Road, Saddar, 
Rawalpindi, Pakistan
Buziness World, 4453 Weeping Willow Drive, Mississauga, Ontario, 
Canada
Business World, 2nd Floor, Kau On Building, 251-253 Cheung Shaw Wan 
Road, Kowloon, Hong Kong
Industria Hong Kong Ltd, d/b/a Transcool Auto Air Conditioning 
Products, d/b/a Electro-Power Solutions, 2nd Floor, Kau On Building, 
251-253 Cheung Shaw Wan Road, Kowloon, Hong Kong
Product Engineering, Unit 10, Chowk Gowalmandi, Daryabad, 
Gowalmandi, Rawalpindi, Punjab, Pakistan

I. Introduction and Background on the Parties

    Pursuant to Section 766.24 of the Export Administration Regulations 
(the ``Regulations'' or ``EAR''),\1\ the Bureau of Industry and 
Security (``BIS''), U.S. Department of Commerce, through its Office of 
Export Enforcement (``OEE''), has requested that I issue an order 
temporarily denying, for a period of 180 days, the export privileges of 
Muhammad Kamran Wali, Muhammad Ahsan Wali, Haji Wali Muhammad Sheikh, 
Ahmed Waheed, Ashraf Khan Muhammad, Business World (of Pakistan), 
Buziness World (of Canada), Business World (of Hong Kong), and 
Industria Hong Kong Ltd, d/b/a Transcool Auto Air Conditioning 
Products, d/b/a Electro-Power Solutions (collectively, ``Respondents'' 
and when only referring to natural persons ``individual Respondents''). 
OEE also has requested, pursuant to Sections 766.23 and 766.24 of the 
Regulations, that this order (``the TDO'') be applied to Product 
Engineering as a related person.
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    \1\ The Regulations, currently codified at 15 CFR parts 730-774 
(2019), originally issued pursuant to the Export Administration Act 
(50 U.S.C. 4601-4623 (Supp. III 2015) (``EAA''), which lapsed on 
August 21, 2001. The President, through Executive Order 13222 of 
August 17, 2001 (3 CFR 2001 Comp. 783 (2002)), as extended by 
successive Presidential Notices, continued the Regulations in effect 
under the International Emergency Economic Powers Act (50 U.S.C. 
1701, et seq. (2012)) (``IEEPA''). On August 13, 2018, the President 
signed into law the John S. McCain National Defense Authorization 
Act for Fiscal Year 2019, which includes the Export Control Reform 
Act of 2018, 50 U.S.C. 4801-4852 (``ECRA''). While Section 1766 of 
ECRA repeals the provisions of the EAA (except for three sections 
which are inapplicable here), Section 1768 of ECRA provides, in 
pertinent part, that all orders, rules, regulations, and other forms 
of administrative action that were made or issued under the EAA, 
including as continued in effect pursuant to IEEPA, and were in 
effect as of ECRA's date of enactment (August 13, 2018), shall 
continue in effect according to their terms until modified, 
superseded, set aside, or revoked through action undertaken pursuant 
to the authority provided under ECRA. Moreover, Section 1761(a)(5) 
of ECRA authorizes the issuance of temporary denial orders.
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    OEE has presented evidence that the Respondents have been operating 
an international procurement scheme to illegally obtain U.S.-origin 
items on behalf of two entities involved in nuclear and missile 
proliferation activities, the Pakistan Atomic Energy Commission 
(``PAEC'') and Pakistan's Advanced Engineering Research Organization 
(``AERO''), without the required BIS licenses. The PAEC and AERO have 
been on BIS's Entity List since November 1998, and September 2014, 
respectively, and a license is required for all items subject to the 
EAR for export, reexport or in-country transfer to the PAEC or AERO.\2\
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    \2\ The PAEC was originally added to the BIS Entity List, along 
with a number of other Pakistani government (and parastatal and 
private) entities involved in nuclear or missile activities, on 
November 19, 1998, shortly after Pakistan detonated a nuclear 
device. 63 FR 64322. Its current listing has remained unchanged 
since September 18, 2014. 15 CFR part 744, Supplement No. 4. All 
items subject to the EAR require a BIS license for export, reexport 
or in-country transfer to the PAEC. Id. AERO was originally added to 
the entity list on September 18, 2014. 79 FR 56003 (Sept. 18, 2014) 
(listing AERO on the Entity List for involvement in the procurement 
of sensitive U.S. technology in support of Pakistan's development of 
its missile and strategic unmanned aerial vehicle (UAV) programs). 
The listing was most recently revised on January 26, 2018. 83 FR 
3580 (adding an alias and two additional addresses to the entry for 
AERO). 15 CFR part 744, Supplement No. 4. All items subject to the 
EAR require a BIS license for export, reexport or in-country 
transfer to AERO, and licenses are subject to a presumption of 
denial. Id., see also 15 CFR 744.11.
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    Beginning in or around at least September 2014, the individual 
Respondents involved in the procurement scheme have used entities that 
they own, operate or control to undertake efforts to obtain U.S.-origin 
items, either directly or through transshipment via third countries, 
while masking that the items were intended for the PAEC and later for 
AERO. OEE's evidence indicates that members of the scheme concealed the 
fact that the PAEC and AERO were the true end users, including at times 
falsely identifying other entities in Pakistan as the end users, 
thereby causing unlicensed exports and the filing of false or 
misleading Electronic Export Information (``EEI'') in the Automated 
Export System (``AES''). In addition, these individual Respondents have 
regularly used the names of other companies or intermediaries on 
shipping documents, or had such entities pay for the U.S.-origin items 
through a third country, to further conceal the identity of the true 
end users from U.S. manufacturers and suppliers and U.S. law 
enforcement authorities. No BIS licenses were sought or obtained for 
any of the exports identified by OEE and described below.
    Respondent Haji Wali Muhammad Sheikh, his sons Muhammad Kamran Wali 
and Muhammad Ahsan Wali, and business associates Ashraf Khan Muhammad 
and Ahmed Waheed, have each been charged with conspiracy to violate the 
International Emergency Economic Powers Act and conspiracy to violate 
the Export Control Reform Act of 2018 in an indictment returned in the 
U.S. District Court for the District of New Hampshire, which is being 
unsealed in conjunction with the issuance of this TDO. The Respondent-
Defendants in that criminal case remain at large. Additionally, OEE's 
ongoing investigation of the Respondents shows that they continue to 
seek similar U.S.-origin items as recently as September 2019, 
underscoring OEE's concern that absent the issuance of a TDO, 
Respondents will continue to divert items to prohibited end users such 
as the PAEC and AERO. A review of EEI

[[Page 4272]]

indicates that members of the scheme have obtained U.S.-origin items as 
recently as November 2019.

Named Individual Respondents and Related Entities

    Set out below is an overview of the individual Respondents involved 
in the procurement scheme, their personal and business relationships 
with each other, and the entities and email accounts that they 
controlled and used in their efforts to unlawfully obtain U.S.-origin 
items for the PAEC and AERO.
    Muhammad Kamran Wali (``Kamran'') is believed to be a citizen and 
resident of Pakistan. He is the owner of Business World, located in 
Rawalpindi, Pakistan (``Business World Pakistan''), which is believed 
to be related to or have business affiliations with Product 
Engineering. Kamran is the son of Respondent Haji Wali Muhammad Sheikh 
and the brother of Respondent Muhammad Ahsan Wali, discussed below. 
Typically, Kamran or Business World Pakistan received the underlying 
tender inquiry or other order from the PAEC or AERO. Kamran is believed 
to control and use the email addresses [email protected] and 
[email protected], through which he communicates with both U.S. 
companies and procurement offices of the PAEC and AERO.
    Muhammad Ahsan Wali (``Ahsan'') is believed to be a citizen and 
resident of Mississauga, Ontario, Canada. He is also believed to be a 
citizen of Pakistan. He is the son of Haji Wali Muhammad Sheikh and the 
brother of Respondent Kamran. Ahsan and his father Haji Wali Muhammad 
Sheikh are believed to control and use the email address 
[email protected]. Ahsan assisted in paying for exports from the 
United States and at least in one instance used a credit card in his 
name to pay for an order of U.S.-origin items.
    Haji Wali Muhammad Sheikh (``Haji'') is a resident of Canada and a 
citizen of Pakistan. Haji is the owner of the Buziness World, located 
in Canada (``Buziness World Canada''). Respondents Kamran and Ahsan are 
his sons. Haji and his son Ahsan are believed to control and use the 
email address [email protected]. Buziness World Canada often appears 
as the payee in transactions and is at times listed as the shipper from 
the United States, even if it is not otherwise involved in the export.
    Ashraf Khan Muhammad (``Khan'') is a resident of Hong Kong. His 
nationality is not known. He identifies himself as the owner of 
Business World, located in Hong Kong (``Business World Hong Kong''), 
and the corporate secretary of Industria Hong Kong Limited (``Industria 
Hong Kong''). Another company called Transcool Auto Air Conditioning 
Products of Hong Kong identifies as a branch of Business World Hong 
Kong. Khan is believed to control and use several email addresses, 
including [email protected] and [email protected]. He 
is a business associate of Kamran discussed above and Ahmed Waheed of 
Ilford, UK.
    Ahmed Waheed (``Waheed'') is a resident of Ilford, England. He is a 
United Kingdom citizen. He was the owner of Business International GB 
Ltd of the United Kingdom, which is now dissolved. He is also the owner 
of Industria Hong Kong. Waheed is believed to control the email address 
[email protected]. He is a business associate of Khan of Hong 
Kong, who also has interests in Industria Hong Kong.

II. Legal Standard

    Pursuant to Section 766.24 of the Regulations, BIS may issue, on an 
ex parte basis, an order temporarily denying a respondent's export 
privileges upon a showing that the order is necessary in the public 
interest to prevent an ``imminent violation'' of the Regulations. 15 
CFR 766.24(a)-(b). ``A violation may be `imminent' either in time or 
degree of likelihood.'' 15 CFR 766.24(b)(3). BIS may show ``either that 
a violation is about to occur, or that the general circumstances of the 
matter under investigation or case under criminal or administrative 
charges demonstrate a likelihood of future violations.'' Id. As to the 
likelihood of future violations, BIS may show that the violation under 
investigation or charge ``is significant, deliberate, covert and/or 
likely to occur again, rather than technical or negligent[.]'' Id. A 
``[l]ack of information establishing the precise time a violation may 
occur does not preclude a finding that a violation is imminent, so long 
as there is sufficient reason to believe the likelihood of a 
violation.'' Id.
    Pursuant to Sections 766.23 and 766.24, a TDO also may be made 
applicable to other persons if BIS has reason to believe that they are 
related to a respondent and that applying the order to them is 
necessary to prevent its evasion. 15 CFR 766.23(a)-(b) and 766.24(c). A 
``related person'' is a person, either at the time of the TDO's 
issuance or thereafter, who is related to a respondent ``by ownership, 
control, position of responsibility, affiliation, or other connection 
in the conduct of trade or business.'' 15 CFR 766.23(a).

III. Respondents Are Engaged in a Longstanding Conspiracy To Procure 
U.S.-Origin Items for the PAEC and AERO

    OEE has presented evidence to show that the individual Respondents 
identified above used a series of entities to surreptitiously obtain 
U.S.-origin items on behalf of prohibited parties the PAEC and AERO 
without the required export licenses. As uncovered in this 
investigation, Kamran or Business World Pakistan received purchase 
orders or tender inquiries from the PAEC and AERO, and he or Business 
World Pakistan would either seek to obtain these items from U.S. 
suppliers, or engage other members of the procurement scheme to obtain 
the items either directly or through intermediary entities. The 
Respondents used a series of aliases and alternative shipping addresses 
to avoid detection by law enforcement and having the shipment flagged 
or questioned by the freight forwarder's export compliance program. The 
investigation uncovered a number of shipments using a similar pattern, 
though using slightly different entities or routes so as to escape 
suspicion and detection. The examples, as outlined in detail below, 
establish reasonable cause to believe that, despite the indictment, the 
Respondents will continue to operate this well-established and durable 
international procurement network for the PAEC and AERO absent action 
by this order.

A. Recent Transactions

    Through its investigation, OEE has developed reasonable cause to 
believe that the Respondents and other members of the procurement 
network continue to obtain U.S.-origin items from U.S. companies in 
violation of U.S. law. Further, because the procurement channels change 
to avoid detection, a PAEC or AERO order may take several months for 
the procurement network to fulfill from a given U.S. company and even 
longer to ultimately reach the prohibited end users. Accordingly, the 
issuance of this TDO is necessary to stop transactions-in-progress and 
prevent U.S.-origin items from reaching prohibited end users. Moreover, 
the scheme is ongoing as OEE's investigation has uncovered that the 
Respondents continued to obtain items in 2018 as detailed below and 
have initiated the process to obtain additional U.S.-origin items in 
late 2019.
1. Company A Transaction
    Company A is a manufacturer located in the United States. OEE's 
investigation indicates that from in or around January

[[Page 4273]]

2018 through in or around July 2018, Kamran of Business World Pakistan 
ordered U.S.-origin items for the PAEC's Heavy Mechanical Complex-3 
(``HMC-3''). The evidence also establishes that Kamran continues to 
solicit U.S.-origin items for the same customer. Kamran made false 
statements in a purchase order, claiming that the items were intended 
for end use by MRI fielded rooms in various hospitals in Pakistan 
through a manufacturer named ``Precision Engineering Services'' in 
Islamabad, Pakistan. In fact, evidence indicates that the items were 
actually intended for end use by the PAEC.
    Specifically, email correspondence dated February 7, 2018, reflects 
that Business World Pakistan (through email address 
[email protected]) had received a tender order from HMC-3, which, 
according to the PAEC's website, is actually the PAEC's ``in house 
design, manufacturing, inspection, testing facilities.'' The tender 
order requested several items specifically manufactured by Company A. 
These were the same items that Business World Pakistan had sought in 
its purchase order to Company A on or about January 8, 2018, and had 
represented were for a hospital rather than a PAEC facility.
    On or about April 19, 2018, Kamran of Business World Pakistan 
placed an order with Company A for the same items in the HMC-3 request. 
On or about April 20, 2018, Kamran of Business World Pakistan forwarded 
to Haji in Canada copies of the Company A's pro forma invoices and 
payment instructions.
    About a week later, Haji in Canada made a wire transfer payment to 
Company A in the United States for $26,266 for the order with the HMC-3 
items. The funds came from Buziness World Canada's account connected 
with Haji. When asked by Company A to explain the relationship between 
Buziness World Canada and Business World Pakistan, Kamran described the 
funds as coming from a ``proprietary'' account and the ``funds transfer 
have been made by them as a favour as we had returned money to customer 
and it will be repaid against delivery to us which we will settle with 
Buziness World Canada later.''
    Business World Pakistan arranged for shipping from Company A, 
though the freight forwarder collecting the shipment from Company A 
listed the shipper as ``Buziness World Canada.'' Shipping records 
indicate that the items were sent from the United States to Pakistan in 
or about June 2018. Based on BIS's investigation, BIS has reasonable 
cause to believe that the U.S.-origin items were intended for the PAEC.
2. Company B Transaction
    Company B is a manufacturer located in the United States. From at 
least in or around 2017 through in or around 2018, Kamran and others at 
Business World Pakistan contacted Company B to obtain U.S.-origin 
industrial safety equipment that BIS has reasonable cause to believe 
was intended for the Chasma Nuclear Power Project of the PAEC. These 
items included Foreign Material Exclusion or ``FME'' placards. The 
payments for these items were facilitated through middle parties, and 
the shipper was listed as Buziness World Canada, even though the order 
was exported directly from the United States to Pakistan.
    On or about June 7, 2018, Kamran of Business World Pakistan 
contacted Company B regarding the delivery status of parts for its 
existing order of FME placards. The Company B representative responded 
the same day indicating that the company was still waiting for the 
delivery of parts.
    Around the same time, Kamran of Business World Pakistan was also in 
contact with freight forwarder Airways Freight Pakistan to pick up the 
shipment from Company B's facilities in New Hampshire. In an email 
dated on or about June 21, 2018, Kamran provided his freight forwarder 
with contact information for the Company B representative. The freight 
forwarder subsequently provided a booking reference that identified the 
shipment as bound for Karachi with the shipper identified as Company B 
and the consignee as ``Business World'' Pakistan. The booking reference 
identified the commodity as ``safety tarps and supplies'' and the 
subject line included a reference to ``FMEZ.'' In response to this 
email from the freight forwarder with the booking reference, Kamran of 
Business World Pakistan requested that the shipper be changed from 
Company B to Buziness World Canada.
    In an email dated August 2, 2018, a Business World Pakistan 
representative, who had been copied on the email to the freight 
forwarder, notified the procurement manager of the PAEC's Chasma 
Nuclear Power Project of delivery delays related to its purchase order 
and sought an extension of delivery time until August 31, 2018. 
Business World Pakistan attached to its email the bill of lading from 
its freight forwarder and referenced the same bill of lading as the one 
identified for Business World Pakistan's shipment from Company B. 
Business World Pakistan had sent its email to [email protected], which 
is believed to be an email associated with the procurement arm of the 
Chasma Nuclear Power Project-3.

B. Historical Transactions

    OEE's investigation revealed that the Respondents have, over a 
period of years, been engaged in a flexible procurement scheme in order 
to illegally route U.S.-origin items to Pakistan. OEE identified a 
number of prior export transactions where the Respondents' procurement 
network obscured the originator of the transaction by incorporating 
middle parties and alternative entities and destinations. OEE has 
demonstrated that the Respondents should be included in this TDO to 
prevent further diversion of U.S.-origin items to the prohibited 
parties the PAEC and AERO.
1. Unlicensed Export to AERO From Company C and Ties to Waheed and Hong 
Kong Company Transcool
    Company C is a manufacturer located in the United States. On or 
about October 4, 2016, Company C of State College, Pennsylvania, sold 
electronics valued at $4,370 to a company in Beckley, West Virginia. 
These items were later transshipped through Hong Kong for ultimate 
export to AERO in Pakistan in fulfillment of a purchase order request 
made through Kamran of Business World Pakistan and routed through 
entities in the United Kingdom, United States, Hong Kong and ultimately 
Pakistan.
    OEE's investigation uncovered that [email protected], an 
email account owned and controlled by Kamran of Business World 
Pakistan, received an AERO tender inquiry dated July 24, 2015, for 
items manufactured by Company C. In a purchase order dated March 10, 
2016, Business World Pakistan requested the same items of Business 
International UK, a company that was owned and controlled by Waheed. 
Business International UK sent an invoice acknowledging the sales order 
on or about March 15, 2016. Thereafter, a company in the United States 
in Beckley, West Virginia, contacted Company C regarding obtaining the 
same items.
    Although Business International UK requested the order and the 
items were ultimately exported via Hong Kong to Pakistan, the company 
in Beckley, West Virginia, was listed as the ``sold to'' and ``ship 
to'' party, and at this time BIS does not have evidence indicating that 
the company in Beckley, West Virginia, which is now dissolved, 
disclosed that the items were for export. OEE's investigation uncovered 
that the

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shipment was sent to a freight forwarder in Hong Kong and a related 
invoice for the Company C items listed ``Transcool Auto Air 
Conditioning Products'' as the recipient at the same address as 
Business World Hong Kong and Industria Hong Kong. An invoice dated 
December 2, 2016, from Kamran of Business World Pakistan (using email 
address [email protected]) to ``Khan'' at Business World 
Hong Kong (received at email address [email protected]), with a 
carbon copy to Waheed (to email address [email protected]) 
included an invoice with the exact same Company C items in product code 
and quantity and in exactly the same order as in the AERO request. 
Based on these facts, BIS has reasonable cause to believe that the 
Respondents engaged in a scheme to transship items that were ultimately 
intended for delivery to AERO in Pakistan.
2. Unlicensed Exports to AERO From Company D and Ties to Business World 
Hong Kong, Business World Canada and Product Engineering in Pakistan
    Company D is an electronics parts supplier located in the United 
States. A series of exports by Company D of Casselberry, Florida, 
highlight the variety of entities and transshipment routes used to 
export U.S.-origin items to AERO. Throughout 2016 and 2017, the 
procurement network used entities in Pakistan, Canada, and Hong Kong to 
fulfill orders for AERO. Company D identified several shipments to 
Business World entities in this time frame, and OEE's investigation 
uncovered the items were connected to purchase orders or other requests 
from either the PAEC or AERO. Examples of these transactions include:
     On or about March 5, 2016, Company D exported capacitors 
to Business World Hong Kong, with Business World Hong Kong listed on 
the invoice as the ``bill to'' and ``ship to'' party. Emails from 
Business World Hong Kong included those signed by ``M.A. Khan.'' OEE 
has reason to believe that this is the same Khan identified above in 
the list of Respondents. OEE's investigation identified an AERO tender 
dated July 2, 2015, and sent to [email protected], an email 
address believed to be controlled by Kamran of Business World Pakistan, 
that listed AERO as seeking the exact same product in the same 
quantity.
     On or about April 20, 2017, Company D exported U.S.-origin 
electronic components to Business World Pakistan. The related invoice 
identifying the ``bill to'' party as Business World Canada and the 
``ship to'' party as Business World Pakistan. OEE's investigation 
identified an AERO purchase order to Business World Pakistan dated 
November 18, 2016, that includes the exact same ten items by part 
number in the same quantity and in exactly the same order as those 
listed on the Company D invoice.
     On or about July 20, 2017, Company D exported U.S.-origin 
semiconductors to Business World Canada. The invoice listed the ``bill 
to'' party as Buziness World Canada and the ``ship to'' party as 
Product Engineering in Pakistan. OEE's investigation identified an AERO 
purchase order dated September 22, 2016, to Business World Pakistan 
that includes the exact same 27 items by part number in the same 
quantity and in exactly the same order as those listed on the Company D 
invoice.
3. Unlicensed Export to the PAEC From Company E and Ties to Electro-
Power Solutions and Industria Hong Kong
    Company E is a supplier located in the United States. In another 
example, the procurement network used entities in Hong Kong, including 
the company name ``Electro-Power Solutions,'' to obtain items for the 
PAEC. Some common elements remained, however, such as oversight and 
direction by Kamran of Business World Pakistan and payment by Business 
World Canada.
    On or about November 10, 2016, Company E of Brentwood, New 
Hampshire, exported cartridge heaters to Industria Hong Kong for an 
order placed by Electro-Power Solutions of Hong Kong, a company located 
at the same address as Business World Hong Kong and Industria Hong 
Kong. Kamran of Business World Pakistan, through his email address of 
[email protected], directed Business World Canada at 
[email protected] to make a wire transfer payment of $1,557.50 to 
Company E. OEE's investigation identified ``ICCC'' or the 
Instrumentation Control and Computer Complex, an arm of the PAEC, as 
requesting the U.S.-origin cartridge heaters from Kamran of Business 
World Pakistan based on an email dated July 25, 2016. A Business World 
Pakistan purchase order to ICCC dated December 30, 2016, confirms that 
the order was revised to 125 cartridge heaters, rather than 150, 
matching the Company E export.
4. Unlicensed Export to AERO From Company F and Ties to Business World 
Hong Kong and Ahsan
    Company F is a manufacturer and distributor located in the United 
States. In another variation of Respondents' procurement scheme, 
Business World Canada used a credit card to pay for an order for AERO 
that was routed through middle parties in Hong Kong for ultimate 
transshipment to Pakistan.
    On or about January 8, 2016, Company F of Las Vegas, Nevada, 
exported electronic connectors to Business World Hong Kong. The related 
invoice listed the ``ship to'' party as Business World Hong Kong and 
the ``bill to'' party as Business World Pakistan, though the actual 
payor was Ahsan of Business World Canada, who paid $9,846 using a 
credit card in his name. OEE's investigation identified an AERO tender 
dated June 8, 2015, with the exact same parts in the same quantity as 
in the Company F invoice; the AERO tender had been forwarded from the 
[email protected] to others at Business World Pakistan. OEE's 
investigation also identified shipping documents where ``M.A. Khan'' of 
Business World Hong Kong reexported the items listed on the Company F 
invoice to Business World Pakistan on or about March 30, 2017. No 
license was obtained for the shipment since Business World Pakistan 
concealed the true end user.

IV. Ongoing Nature of Respondents' Procurement Scheme

    BIS's investigation has uncovered that Respondents continue to seek 
U.S.-origin items from companies which they have previously obtained 
items on behalf of the PAEC and AERO, and with which they have an 
established business relationship. As recently as September 2019, 
Business World Hong Kong, using a well-established modus operandi, 
including the same email addresses and aliases used in prior efforts to 
illegally obtain U.S.-origin items for the PAEC, sought to obtain 
additional items from U.S. companies. Specifically, on or about April 
12, 2019, Business World Hong Kong re-engaged the U.S. company to seek 
new items--picking up an earlier email exchange that had been used as 
part of the illegal procurement scheme on behalf of the PAEC. Not only 
was the means of engagement identical, Business World Hong Kong sought 
the same cartridge heaters as had been acquired previously. Further, 
based on OEE's review of the procurement scheme's prior transaction and 
the entities involved here, OEE has reasonable cause to believe that 
the current request is also for listed entities, the PAEC and AERO. 
Similarly, continuing through late 2019, Kamran contacted U.S. 
companies to obtain other U.S.-origin items that BIS has reasonable 
cause to believe are for listed entities, such as the PAEC and AERO, 
based on his prior transactions. These

[[Page 4275]]

transactions included payments from seemingly unrelated entities in 
third countries in a method similar to other transactions.
    In sum, Respondents operated a well-developed procurement scheme 
for at least five years, designed to circumvent U.S. restrictions on 
exports of items to the PAEC and AERO based on their involvement in the 
proliferation of nuclear and missile technology. This scheme involved 
multinational entities and players located in at least three countries, 
the use of related and unrelated companies, changeable transshipment 
routes, and duplicitous methods of payment. Respondents themselves 
routinely generated false information to avoid detection of the scheme. 
In addition, on its own, the unsealing of the criminal indictment 
against the individual Respondents will not give the public sufficient 
notice of the individuals and entities involved in the ongoing 
procurement scheme. Thus, with the identification of the Respondents as 
set forth in this TDO, the undersigned expects to reduce the likelihood 
that U.S.-origin items will be exported, reexported or transferred to 
listed entities as part of the procurement scheme.
    Based on the foregoing evidence, the scheme is durable and ongoing, 
and violations of the Regulations are thereby imminent.

V. Related Persons

    Section 766.23 of the Regulations provides that in order to prevent 
evasion, TDOs ``may be made applicable not only to the respondent, but 
also to other persons then or thereafter related to the respondent by 
ownership, control, position of responsibility, affiliation, or other 
connection in the conduct of trade or business.'' 15 CFR 766.23(a). 
Related persons may be added to a TDO on an ex-parte basis in 
accordance with Section 766.23(b) of the Regulations. 15 CFR 766.23(b). 
The designation of Product Engineering's name and address as the ``ship 
to'' party in at least one transaction highlights that Respondents 
regularly used their affiliations and business relationships to obscure 
the true end user of an export of U.S.-origin items. Product 
Engineering is intertwined in its conduct of business with Kamran of 
Business World Pakistan, and as such is properly designated as a 
related person. As noted above, the Respondents regularly procured 
U.S.-origin items for the PAEC and AERO, and OEE uncovered evidence 
that U.S.-origin items shipped to Product Engineering were ultimately 
destined for the prohibited end users.

VI. Findings

    I find that the evidence presented by BIS demonstrates that a 
violation of the Regulations is imminent in both time and degree of 
likelihood. The Respondents have engaged in knowing violations of the 
Regulations relating to the procurement of U.S.-origin items subject to 
the Regulations for export to persons on the BIS Entity List, at times 
via transshipment through Hong Kong, while providing false or 
misleading information regarding the ultimate consignee and final 
destination of the items to U.S. suppliers and/or the U.S. Government. 
Respondents structured and routed their transactions in a manner 
designed to conceal or obscure the destinations, end users, and/or end 
uses of the U.S.-origin items they procure, thereby attempting to avoid 
export control scrutiny and possible detection by U.S. law enforcement.
    In sum, the facts and circumstances taken together, including the 
transshipment of U.S.-origin items, misrepresentations made in AES 
filings, and concerted actions of the Respondents, coupled with very 
recent activity employing the same modus operandi, provide strong 
indicators that violations likely are imminent absent the issuance of a 
TDO. Therefore, a TDO is needed to give notice to persons and companies 
in the United States and abroad that they should cease dealing with the 
Respondents in export transactions involving items subject to the EAR. 
Accordingly, I find that an order denying the export privileges of 
Muhammad Kamran Wali, Muhammad Ahsan Wali, Haji Wali Muhammad Sheikh, 
Ahmed Waheed, Ashraf Khan Muhammad, Business World (of Pakistan), 
Buziness World (of Canada), Business World (of Hong Kong), and 
Industria Hong Kong Ltd, d/b/a Transcool Auto Air Conditioning 
Products, d/b/a Electro-Power Solutions is necessary, in the public 
interest, to prevent an imminent violation of the EAR. Additionally, I 
find that Product Engineering meets the criteria set out in Section 
776.23 and should be added to the TDO as a related person in order to 
prevent evasion.
    This Order is being issued on an ex parte basis without a hearing 
based upon BIS's showing of an imminent violation in accordance with 
Sections 766.24 and 766.23(b) of the Regulations.
    It is therefore ordered:
    First, that MUHAMMAD KAMRAN WALI, with the last known address of 
1st Floor Jahanzeb Center, Bank Road, Saddar, Rawalpindi, Pakistan; 
MUHAMMAD AHSAN WALI, with the last known address of 4453 Weeping Willow 
Drive, Mississauga, Ontario, Canada; HAJI WALI MUHAMMAD SHEIKH, with 
the last known address of 4453 Weeping Willow Drive, Mississauga, 
Ontario, Canada; AHMED WAHEED, with the last known address of 143 Wards 
Road, Ilford, Essex, United Kingdom; ASHRAF KHAN MUHAMMAD, M/F 20 Pei 
Ho Street, Sham Shui Po, Kowloon, Hong Kong; BUSINESS WORLD, with the 
last known address of 1st Floor Jahanzeb Center, Bank Road, Saddar, 
Rawalpindi, Pakistan; BUZINESS WORLD, with the last known address of 
4453 Weeping Willow Drive, Mississauga, Ontario, Canada; BUSINESS 
WORLD, with the last known address of 2nd Floor, Kau On Building, 251-
253 Cheung Shaw Wan Road, Kowloon, Hong Kong; INDUSTRIA HONG KONG LTD, 
d/b/a TRANSCOOL AUTO AIR CONDITIONING PRODUCTS, d/b/a ELECTRO-POWER 
SOLUTIONS, with the last known address of 2nd Floor, Kau On Building, 
251-253 Cheung Shaw Wan Road, Kowloon, Hong Kong; and PRODUCT 
ENGINEERING, Unit 10, Chowk Gowalmandi, Daryabad, Gowalmandi, 
Rawalpindi, Punjab, Pakistan, and when acting for or on their behalf, 
any successors, assigns, directors, officers, employees, or agents 
(each a ``Denied Person'' and collectively the ``Denied Persons'') 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 Export Administration 
Regulations (``EAR''), or in any other activity subject to the EAR 
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 EAR, or engaging in any other 
activity subject to the EAR; 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 EAR, or from any other activity subject to the EAR.
    Second, that no person may, directly or indirectly, do any of the 
following:
    A. Export or reexport to or on behalf of a Denied Person any item 
subject to the EAR;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by

[[Page 4276]]

a Denied Person of the ownership, possession, or control of any item 
subject to the EAR that has been or will be exported from the United 
States, including financing or other support activities related to a 
transaction whereby a 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 a Denied Person of any item subject to 
the EAR that has been exported from the United States;
    D. Obtain from a Denied Person in the United States any item 
subject to the EAR 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 EAR 
that has been or will be exported from the United States and which is 
owned, possessed or controlled by a Denied Person, or service any item, 
of whatever origin, that is owned, possessed or controlled by a Denied 
Person if such service involves the use of any item subject to the EAR 
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 Section 766.23 of the EAR, any other person, firm, corporation, or 
business organization or entity related to Muhammad Kamran Wali, 
Muhammad Ahsan Wali, Haji Wali Muhammad Sheikh, Ahmed Waheed, Ashraf 
Khan Muhammad, Business World (of Pakistan), Buziness World (of 
Canada), Business World (of Hong Kong), and Industria Hong Kong Ltd by 
ownership, control, position of responsibility, affiliation, or other 
connection in the conduct of trade or business may also be made subject 
to the provisions of this Order.
    In accordance with the provisions of Section 766.24(e) of the EAR, 
Muhammad Kamran Wali, Muhammad Ahsan Wali, Haji Wali Muhammad Sheikh, 
Ahmed Waheed, Ashraf Khan Muhammad, Business World (of Pakistan), 
Buziness World (of Canada), Business World (of Hong Kong), and 
Industria Hong Kong Ltd may, at any time, appeal this Order by filing a 
full written statement in support of the appeal with the Office of the 
Administrative Law Judge, U.S. Coast Guard ALJ Docketing Center, 40 
South Gay Street, Baltimore, Maryland 21202-4022.
    In accordance with the provisions of Sections 766.23(c)(2) and 
766.24(e)(3) of the EAR, Product Engineering may, at any time, appeal 
its inclusion as a related person by filing a full written statement in 
support of the appeal with the Office of the Administrative Law Judge, 
U.S. Coast Guard ALJ Docketing Center, 40 South Gay Street, Baltimore, 
Maryland 21202-4022.
    In accordance with the provisions of Section 766.24(d) of the EAR, 
BIS may seek renewal of this Order by filing a written request not 
later than 20 days before the expiration date. Muhammad Kamran Wali, 
Muhammad Ahsan Wali, Haji Wali Muhammad Sheikh, Ahmed Waheed, Ashraf 
Khan Muhammad, Business World (of Pakistan), Buziness World (of 
Canada), Business World (of Hong Kong), and Industria Hong Kong Ltd may 
oppose a request to renew this Order by filing a written submission 
with the Assistant Secretary for Export Enforcement, which must be 
received not later than seven days before the expiration date of the 
Order.
    A copy of this Order shall be sent to Muhammad Kamran Wali, 
Muhammad Ahsan Wali, Haji Wali Muhammad Sheikh, Ahmed Waheed, Ashraf 
Khan Muhammad, Business World (of Pakistan), Buziness World (of 
Canada), Business World (of Hong Kong), Industria Hong Kong Ltd and 
Product Engineering, and shall be published in the Federal Register.
    This Order is effective upon issuance and shall remain in effect 
for 180 days.

     Dated: January 15, 2020.
Douglas Hassebrock,
Acting Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2020-01118 Filed 1-23-20; 8:45 am]
 BILLING CODE 3510-33-P