11 May 1998:
See also BXA action on Thane-Coat: http://jya.com/bxa051198.txt

7 May 1998
Source: http://www.access.gpo.gov/su_docs/aces/aaces002.html

-------------------------------------------------------------------------

[Federal Register: May 7, 1998 (Volume 63, Number 88)]
[Notices]
[Page 25199-25200]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07my98-37]

-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

Bureau of Export Administration


Action Affecting Export Privileges; Export Materials, Inc. and
Thane-Coat International, Ltd.; Decision and Order on Renewal of
Temporary Denial Order

    In the matters of: Export Materials, Inc., 3727 Greenbrier
Drive, No. 108, Stafford, Texas 77477, and Thane-Coat International,
Ltd., Suite C, Regent Centre, Explorers Way, P.O. Box F-40775,
Freeport, The Bahamas, Respondents.

    On October 31, 1997, Acting Assistant Secretary for Export
Enforcement Frank W. Deliberti issued a Decision and Order on Renewal
of Temporary Denial Order (hereinafter ``Order'' or ``TDO''), renewing
for 180 days a May 5, 1997 Order naming Thane-Coat, Inc.; Jerry Vernon
Ford, president, Thane-Coat, Inc.; Preston John Engebretson, vice-
president, Thane-Coat, Inc.; Export Materials, Inc.; and Thane-Coat
International, Ltd. (Export Materials, Inc. And Thane-Coat,
International, Ltd. hereinafter collectively referred to as the
``Respondents'' and Thane-Coat, Inc., Ford, and Engebretson, the
``affiliated parties''), as persons temporarily denied all U.S. export
privileges. 62 FR 60063-60065 (November 6, 1997). The Order will expire
on April 29, 1998.
    On April 9, 1998, pursuant to Section 766.24 of the Export
Administration Regulations (15 C.F.R. Parts 730-774 (1997))
(hereinafter the ``Regulations''), issued pursuant to the Export
Administration Act of 1979, as amended (50 U.S.C.A. app. sections 2401-
2420 (1991 & Supp. 1998)) (hereinafter the ``Act''),\1\ the Office of
Export Enforcement, Bureau of Export Administration, United States
Department of Commerce (hereinafter ``BXA''), requested that the
Assistant Secretary for Export Enforcement renew the Order against
Thane-Coat International, Inc. and Export Materials, Inc. for an
additional 180 days.
---------------------------------------------------------------------------

    \1\ The Act expired on August 20, 1994. Executive Order 12924 (3
C.F.R., 1994 Comp. 917 (1995)), extended by Presidential Notices of
August 15, 1995 (3 C.F.R., 1995 Comp. 501 (1996)), August 14, 1996
(3 C.F.R., 1996 Comp. 298 (1997)), and August 13, 1997 (62 FR 43629,
August 15, 1997), continued the Regulations in effect under the
International Emergency Economic Powers Act (currently codified at
50 U.S.C.A. 1701-1706 (1991 & Supp. 1998)).
---------------------------------------------------------------------------

    In its request, BXA stated that, as a result of an ongoing
investigation, it had reason to believe that, during the period from
approximately June 1994 through approximately July 1996, Thane-Coat,
Inc., through Ford and Engebretson, and using its affiliated companies,
Thane-Coat International, Ltd. and Export Materials, Inc., made
approximately 100 shipments of U.S.-origin pipe coating materials,
machines, and parts to the Dong Ah Consortium in Benghazi, Libya. These
items were for use in coating the internal surface of prestressed
concrete cylinder pipe for the Government of Libya's Great Man-Made
River Project.\2\ Moreover, BXA's investigation gave it reason to
believe that the Respondents and the affiliated parties employed a
scheme to export U.S.-origin products from the United States, through
the United Kingdom, to Libya, a country subject to a comprehensive
economic sanctions program, without the authorizations required under
U.S. law, including the Regulations. The approximate value of the 100
shipments at issue was $35 million. In addition, the Respondents and
the affiliated parties undertook several significant and affirmative
actions in connection with the solicitation of business on another
phase of the Great Man-Made River Project.
---------------------------------------------------------------------------

    \2\ BXA understands that the ultimate goal of this project is to
bring fresh water from wells drilled in southeast and southwest
Libya through prestressed concrete cylinder pipe to the coastal
cities of Libya. This multibillion dollar, multiphase engineering
endeavor is being performed by the Dong Ah Construction Company of
Seoul, South Korea.
---------------------------------------------------------------------------

    BXA has stated that it believes that the matters under
investigation and the information obtained to date in that
investigation support renewal of the TDO issued against the
Respondents.\3\ BXA believes that a temporary denial order is necessary
to give notice to companies in the United States and abroad that they
should cease dealing with Thane-Coat International, Inc. and Export
Materials, Inc. in export-related transactions involving U.S.-origin
goods.
---------------------------------------------------------------------------

    \3\ On April 17, 1998, BXA requested that the Assistant
Secretary for Export Enforcement renew the October 31, 1997 TDO
against Thane-Coat, Inc., Jerry Vernon Ford, and Preston John
Engebretson.
---------------------------------------------------------------------------

    Based on BXA's showing, I find that it is appropriate to renew the
order temporarily denying all U.S. export privileges of Thane-Coat
International, Ltd. and Export Materials, Inc. I find that such renewal
is necessary in the public interest to prevent an imminent violation of
the Regulations and to give notice to companies in the United States
and abroad to cease dealing with these persons in any commodity,
software, or technology exported or to be exported from the United
States and subject to the Export Administration Regulations, or in any
other activity subject to the Regulations. Moreover, I find such
renewal is in the public interest in order to reduce the substantial
likelihood that Thane-Coat International, Inc. and Export Materials,
Inc. will engage in activities which are in violation of the
Regulations.
    Accordingly, it is therefore ordered:
    First, that Thane-Coat International, Ltd., and all of its
successors or assigns, officers, representatives, agents, and

[[Page 25200]]

employees when acting on its behalf, and Export Materials, Inc., and
all of its successors or assigns, officers, representatives, agents,
and employees when acting on its behalf (hereinafter referred to
collectively as 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 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. Benefiting 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 any denied person any item
subject to the Regulations;
    B. Take any action that facilitates the acquisition, or attempted
acquisition, by any 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 any 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 any denied person of any item
subject to the Regulations that has been exported from the United
States;
    D. Obtain from any 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 any denied person, or
service any item, of whatever origin, that is owned, possessed or
controlled by any 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 Section 766.23 of the Regulations, any person, firm, corporation, or
business organization related to any 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.
    This order, which constitutes final agency action in this matter,
is effective immediately and shall remain in effect for 180 days.
    A copy of this Order shall be served on each Respondent and this
Order shall be published in the Federal Register.

    Entered this 29th day of April, 1998.
F. Amanda, DeBusk,
Assistant Secretary for Export Enforcement.

Certificate of Service

    I hereby certify that, on April 30, 1998, I caused the foregoing
Decision and Order on Renewal of Temporary Denial Order to be mailed
first-class, postage prepaid to: Export Materials, Inc., 3727
Greenbriar Drive, No. 108, Stafford, Texas 77477.
    I hereby certify that on April 30, 1998, I caused the foregoing
Decision and Order on renewal of Temporary Denial Order to be mailed
registered mail, return receipt requested to: Thane-Coat International,
Ltd., Suite C, Regent Centre, Explores Way, P.O. Box F-40775, Freeport,
The Bahamas.
Lucinda G. Maruca,
Secretary, Office of the Assistant Secretary for Export Enforcement.
[FR Doc. 98-12188 Filed 5-6-98; 8:45 am]
BILLING CODE 3510-DT-M
