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Cablegate: Extrancheck: Pre-License Check: Fsue

VZCZCXYZ0016
PP RUEHWEB

DE RUEHMO #1722 1061109
ZNR UUUUU ZZH
P 161109Z APR 07
FM AMEMBASSY MOSCOW
TO RUCPDOC/USDOC WASHDC PRIORITY
INFO RUEHC/SECSTATE WASHDC 9325
RHMFIUU/US CUSTOMS AND BORDER PROTECTION WASHINGTON DC

UNCLAS MOSCOW 001722

SIPDIS

SIPDIS

USDOC FOR 532/OEA/MHAMES/LRITTER
USDOC FOR 3150/USFCS/OIO/CEENIS/MCOSTA

E.O. 12958: N/A
TAGS: BEXP ETRD ETTC RS
SUBJECT: EXTRANCHECK: PRE-LICENSE CHECK: FSUE
GERMANIUM, KRASNOYARSK, RUSSIA, LICENSE NO. D372120

REFTEL: USDOC 01913

1. Unauthorized disclosure of the information provided
below is prohibited by Section 12C of the Export
Administration Act.

2. Reftel requested a Pre-license check to determine
the legitimacy and reliability of the end-user, FSUE
Germanium, Krasnoyarsk, Russia. The company is listed
on BIS license application D372120 as the ultimate
consignee of ESX150 optical machining center with 3
liner and 2 rotary axes. These items are controlled
for national securities, nuclear non-proliferation
reasons under ECCN 2B001. The licensee is VI
Manufacturing, DBA Optipro systems 6368 Dean Parkway,
Ontario, NY 14519.

3. On April 5, 2007, Export Control Attache Donald
Pearce and FSN Natalya Shipitsina conducted the
requested pre-license check at the offices of FSUE
Germanium, Transportny proyezd 1, Krasnoyarsk, Russia.
The export control team met with Oleg Podkopaev,
General Director.

4. FSUE Germanium was founded in 1991 from the
Germanium production facility of the Krasnoyarsk
Metallurgical Plant. The facilities are located in a
building on the grounds of Krasnoyarsk Metallurgical
Plant (Russian abbreviation KMZ), which refines and
produces articles from precious metals such as gold
and platinum. KMZ is a Joint Stock Company controlled
by the Krasnoyarsk Regional Government, and FSUE
Germanium is 100% owned by the Government of Russia.
The only product produced and refined is Germanium.
The company has no military contracts. 85% of sales
are exports to the United States, United Kingdom,
Israel and Japan. FSUE Germanium has no clients
located in Iran, North Korea, Syria or Cuba.

5. The machine tools cited in reftel will be used in
the production of germanium lenses and forms. These
items are common for use in infrared detectors and
laser products. FSUE Germanium selected the U.S.
origin equipment as it can produce a larger lens (up
to 200mm in diameter) and can produce square forms.
In addition, the device is less expensive than the
closest German competitor. Five to seven operators
will have access to the device, which will be
installed on the first floor of the facility in a
specially prepared workspace.

6. Due to the presence of high-value raw materials and
finished commodities, security at KMZ is high. A
three-meter (10 foot) high perimeter wall with razor
wire and a second internal fence surround the
facility, which is patrolled by armed guards. A video
surveillance system and electronic sensor system are
employed as well. Access is limited to employees
based on work schedule (no after-hours access is
allowed) and to escorted visitors. Vehicles entering
the facility are searched before exiting.

7. Recommendations: Post recommends FSUE Germanium,
Krasnoyarsk, Russia, as reliable recipients of
sensitive U.S. origin commodities. It is requested
that post be notified of final disposition of the
application, and of any shipments for this
organization in order to conduct appropriate FCS
follow-up and statistical reporting.
(FCS MOSCOW/SBOZEK/DPEARCE)
BURNS

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