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Cablegate: Extrancheck: Post Shipment Verification:

VZCZCXYZ0014
RR RUEHWEB

DE RUEHHK #1653 1720406
ZNR UUUUU ZZH
R 210406Z JUN 07
FM AMCONSUL HONG KONG
TO RUCPDOC/USDOC WASHDC
INFO RUEHC/SECSTATE WASHDC 2023
RHMFIUU/HQ BICE WASHINGTON DC

UNCLAS HONG KONG 001653

SIPDIS

USDOC FOR 532/OEA/LHINES/DFARROW
USDOC FOR 3132 FOR FCS/OIO REGIONAL DIRECTOR
WILLIAM ZARIT
BICE FOR OFFICE OF STRATEGIC INVESTIGATIONS

SIPDIS

E.O. 12958: N/A
TAGS: BMGT BEXP HK ETRD ETTC
SUBJECT: EXTRANCHECK: POST SHIPMENT VERIFICATION:
KEYENCE (HK) ELECTRONICS HONG KONG

REF: A) USDOC 02961

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

2. As per reftel A request and at the direction of
the Office of Enforcement Analysis (OEA) of the
USDOC Bureau of Industry and Security (BIS),
Export Control Officer Philip Ankel (ECO)
conducted a post shipment-verification at Keyence
(HK) Electronics Hong Kong, Suite 713, Prudential
Tower, 21 Canton Road, Tsimshatsui, Kowloon, Hong
Kong (Keyence). The item in question is a Genesis
XM2 Imaging System exported to Keyence on or about
February 22, 2007 and valued at USD 45,084. On
the applicable shippers export declaration (SED),
the item is classified as 3A999. Items properly
classified as 3A999 may be exported/reexported to
virtually all destinations and end-users
worldwide, license free, except for certain
designated state sponsors of terrorism (including
North Korea). The exporter was Edax, Inc. of
Mahwah, New Jersey.

3. According to the Hong Kong Companies Registry,
Keyence has been in existence since 2001. Its
paid-up share capital is the Hong Kong equivalent
of USD 600,000. Japanese nationals, Michio Sasaki
and Nobuaki Sugahara are listed as directors.
Keyence is the Hong Kong affiliate office of
Keyence Corporation, a Japanese listed company
based in Osaka. The company produces and
distributes microscopes, sensors and other
instruments used in industrial automation
applications (more information at
www.keyence.com).

4. On June 14, 2007, the ECO met with Mr.
Sugahara, Director, and Ms. Christine Kee,
assistant at the address referenced above. ECO
and FCS commercial assistants had been attempting
to schedule a meeting with Mr. Sugahara for some
time. Mr. Sugahara apologized for the delay,
explaining that he is often in mainland China on
business. Mr. Sugahara provided background
information on Keyence (consistent with content on
the company's web site). He stated that Keyence
customers in China are typically producers of
integrated circuits, electronics components and
automotive products.

5. As to the specific item in question, Mr.
Sugahara provided copies of a delivery note
indicating that the item had been delivered to
Ushio Hong Kong Limited. Mr. Sugahara stated that
this company is also a Japanese listed company
involved in production of light sources
(www.ushio.com and www.ushio.com.jp). Mr.
Sugahara stated that the item would be used in the
Hong Kong production facility of Ushio.

6. At the time visited, Keyence appeared to be a
suitable recipient of the commodities shipped (as
reseller) since Keyence cooperated with the PSV
and provided all requested information concerning
the final disposition of the applicable items. At
the same time, the ECO was not able to inspect the
subject items as they had already been delivered
to Keyence's customer. Consistent with guidance
on reporting of PSVs where the items cannot be
physically inspected, the ECO recommends that this
PSV be classified as Limited.

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