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Cablegate: Blue Lantern Level 3: Pre-License End-Use Check On

VZCZCXYZ0006
PP RUEHWEB

DE RUEHBK #1673/01 1541048
ZNR UUUUU ZZH
P 021048Z JUN 08
FM AMEMBASSY BANGKOK
TO RUEHC/SECSTATE WASHDC PRIORITY 3233
INFO RUEKJCS/SECDEF WASHINGTON DC PRIORITY
RUCPDOC/USDOC WASHINGTON DC PRIORITY

UNCLAS BANGKOK 001673

SIPDIS

PM/DTTC FOR BLUE LANTERN COORDINATOR

E.O. 12958: N/A
TAGS: ETTC KOMC TH
SUBJECT: BLUE LANTERN LEVEL 3: PRE-LICENSE END-USE CHECK ON
LICENSES 050059704, 050089662, AND 050095708

REF: STATE 44819

1. (U) Thai Ministry of Commerce lists the subject company as
Kamolrat Commercial, not Kamolart as reftel.

Registration No. 0605543000353
Registered Date: September 14, 2000
Status: limited company
Capital Registration: 10,000,000 baht
Executives: Anuchit Kanphakdi, Chatri Sukthawi, Lt. Gen.
Saman Thammachari, and Wha Phansi.
Authorized executive members for legal commitments: Anuchit
or Chatri.
Company Location: 99 Moo 3, Tambon Nong Pling, Amphoe Muang
Nakhon Sawan, Nakhon Sawan Province.
The company has submitted annual financial reports for
2000-2006.
Purpose of Company: To sell weapons and military equipment.

2. (U) The reftel telephone number did not work and the area
code would be located in Bangkok, not Nakhon Sawan. Kamolrat
Commercial was listed in the phone directory as 056-300-144
and 056-300-135 under the address provided reftel.

3. (U) POL FSN May 21 visited the Nakhon Sawan District
Office and the Nakhon Sawan Provincial Commerce Office, some
240 kilometers north of Bangkok. Both offices confirmed the
existence and registration of Kamolrat Commercial. From
their records, there was no derogatory or negative
information on the company. The District Office record's of
gun permit indicate that the reftel lots of weapons will not
be shipped to Nakhon Sawan for inspection.

4. (U) POL FSN visited Kamolrat May 21 in Nakhon Sawan. The
company's location was confirmed as stated reftel. Kamolrat
was located in a large munitions factory called Royal
Ammunitions or Olympic Arms & Ammunitions. Post conducted a
Blue Lantern investigation on the facility in May 2005. The
compound was well-guarded with CCTV and other safety
precautions. The Kamolrat Maintenance Chief stated that the
company was not yet in full operation in Nakhon Sawan since
the company's administrators had not yet completely moved to
the site, rather some work from home in Bangkok. The
facility was located in an empty three-story new structure
with an empty factory located adjacent for a future project
to manufacture foreign-designed pistols in Thailand. A Thai
military officer had been assigned by Ministry of Defense to
supervise the operations of this company.

5. (U) Chatri Sukthawi, a Kamolrat executive, answered
questions regarding the company. He and his group of
companies have been under the Blue Lantern examination in the
past. Chatri said his company has been in the weapon
business since 2000 and was certified by the Ministry of
Defense in 2003 or 2004 to expand its business to manufacture
and repair in Thailand foreign-designed pistols. The company
had approached Glock and Steyer from Austria; Beretta from
Italy; Armslucks from the Philippines; and Colt, Smith &
Wesson and HTI from the U.S. for a possible joint venture.
The building structure was complete and the company was in
the process of installing machines. Chatri said Kamolrat was
an authorized representative in Thailand for Colt.

6. (U) Chatri said Kamolrat understands restrictions on
United States Munitions List items. Chatri himself
understood these restrictions well as he owned Supnakorn
Partnership, Akekapatt Fire Arms Part., and Kamolrat
International Co., Ltd. Chatri confirmed the reftel purchase
of three lots of weapons, as contracted by the Bureau of
Territorial Defense Volunteer, Department of Provincial
Administration, Ministry of Interior. The weapons would be
shipped directly from the U.S. to Bangkok and then to the
Bureau's warehouse without transiting the company's facility
in Nakhon Sawan. Chatri said the first lot (DTC 050059704 -
550 pieces) had arrived at Suvarnabhumi Airport in Bangkok
and was pending import clearance. The second and the third
lots (DTC 050089662 - 550 pieces and DTC 050095708 - 650
pieces) were being manufactured in the U.S. Chatri did not
present any related documents and said the documents were in
Bangkok. He promised to send to the Embassy but none had
arrived as of June 2.

7. (U) POL FSN May 22 visited the Bureau of Territorial
Defense Volunteers and met Somchai Kiat-kongkaew,
Chief of Welfare Section, who is responsible for the
purchase. Somchai and his Bureau were under the Blue Lantern
examination a few times in the past. Also present was Surasak
Phonyangsong, Chief of General Affairs Section of the Bureau.


Question: How many purchase orders did the GOT submit to US
applicant, Colt Defense, LLC?

Response: The Bureau had planned to purchase 1,800 Colt M4s
for use by its personnel. The purchase was divided into
three separate lots via Kamolrat Commercial Co., Ltd,
numbering 1,750 pieces, as detailed reftel. More purchases
are expected in the future. The Bureau may have ordered
other types of guns from the Colt in the past via other
companies.

Question: Can the GOT confirm its orders for the firearms
listed on these license applications?

Response: Yes, but only verbally. The Bureau was unable to
provide related documents because they were at other offices
in Ministry of Interior. The Bureau did present Purchase
Contract No. 104/255 1, dated February 15, 2008, signed
between the Bureau and the Kamolrat Commercial, for the first
lot. However, the number ordered as appeared in this
contract was 500, not 550 as stated reftel. The Bureau said
Kamolrat Commercial would provide the extra 50 pieces to the
Bureau for free. This was a verbal commitment, not in
contract form. The lot was scheduled to be delivered to the
Bureau on August 3,2008.

Question: Why is the GOT party to three licenses to acquire
these rifles instead of one large license?

Response: The Bureau and Chatri of Kamolrat Commercial said
the reason for this was the Bureau's budget plan and approval
process for the purchases. The purchases had been approved
in three lots, two in 2007 and one in 2008. Chatri added
that his company desired to limit purchases to approximately
ten million baht (approximately $312,000) including taxes and
transportation costs. Kamolrat therefore preferred to
purchase smaller lots. Smaller lots also reduced the risk of
losses to delays in production, delivery problems, and
losses.

Question: Did Colt Defense LLC recommend several small orders
as opposed to a large order?

Response: Chatri and the Bureau denied this. The smaller
orders were an agreement between the Bureau and the Kamolrat
Commercial.

Question: Why is the GOT purchasing this large quantity of M4
carbines? Are they undergoing a modernization program,
increasing numbers for personnel, etc?

Response: The Bureau said it was modernizing weapons and had
increased the number of personnel. The Bureau had been
authorized 1,800 more personnel in addition to 17,743 members
nationwide. 3,699 are posted to the troubled southern region
(Yala, Pattani, Narathiwat Provinces and four districts of
Songkhla Province) of Thailand. The additional personnel
would be assigned to Southern Thailand. The new weapons
would be used for security operations in the South as well as
border areas nationwide. The weapons would remain government
property.

Question: What weapons will these M4 carbines replace?

Response: They would replace Ml6 and M16 A2 weapons.

Question: What is the GOT going to do with the older weapons
that are being replaced?

Response: The Bureau representatives stated the weapons would
remain in use or stored in the Bureau's warehouse as reserve
weapons. The Bureau lacked weapons for its operations. The
M16s would not be destroyed at this point.

Question: Confirm the receipt of the firearms on 050089662
and 050059704.

Response: The Bureau representatives stated the Bureau had
not received any of the new weapons.

8. (U) Additional information:

- Chatri stated that the weapons for license 050059704 (550
pieces) had arrived in Thailand but were pending import
clearance. The weapons in licenses 050089662 (550 pieces)
and 050095708 (650 pieces) were still being manufactured in
the US.

- The Bureau, although verbally confirming the purchase of
weapons in three lots, had only presented Post one written
purchase contract for 500 and not 550 Colt M4s. The officers
did not know the license number for this transaction. As of
May 30, the Bureau representatives said the purchase
contracts for the other two lots are still being processed
within the Ministry of Interior.
JOHN

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