Action Affecting Export Privileges; Summit Marketing, Inc., Order Denying Permission To Apply for or Use Export Licenses

DEPARTMENT OF COMMERCE

Bureau of Export Administration

Action Affecting Export Privileges; Summit Marketing, Inc., Order

Denying Permission To Apply for or Use Export Licenses

In the Matter of: Summit Marketing, Inc., 52 Blackburn Center,

Gloucester, Massachusetts 01930.

On September 26, 1997, Summit Marketing, Inc. was convicted in the

United States District Court for the District of Massachusetts on four

counts of violating Section 38 of the Arms Export Control Act

(currently codified at 22 U.S.C.A. Sec. 2778 (1990 & Supp. 1998)) (the

AECA). Specifically, Summit Marketing, Inc. was convicted of knowingly

and willfully exporting and attempting to export defense articles to

France, for transshipment to Iran, without obtaining the required

export licenses from the Department of State.

Section 11(h) of the Export Administration Act of 1979, as amended

(currently codified at 50 U.S.C.A. app. Secs. 2401-2420 (1991 & Supp.

1998)) (the Act),\1\ provides that, at the discretion of the Secretary

of Commerce,\2\ no person convicted of violating the AECA, or certain

other provisions of the United States Code, shall be eligible to apply

for or use any license, including any

[[Page 27561]]

License Exception, issued pursuant to, or provided by, the Act or the

Export Administration Regulations (currently codified at 15 C.F.R.

Parts 730-774 (1997)) (the Regulations), for a period of up to 10 years

from the date of the conviction. In addition, any license issued

pursuant to the Act in which such a person had any interest at the time

of conviction may be revoked.

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\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 Fed. Reg.

43629, August 15, 1997), continued the Export Administration

Regulations in effect under the International Emergency Economic

Powers Act (50 U.S.C.A. Secs. 1701-1706 (1991 & Supp. 1998)).

\2\ Pursuant to appropriate delegations of authority, the

Director, Office of Exporter Services, in consultation with the

Director, Office of Export Enforcement, exercises the authority

granted to the Secretary by Section 11(h) of the Act.

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Pursuant to Sections 766.25 and 750.8(a) of the Regulations, upon

notification that a person has been convicted of violating the AECA,

the Director, Office of Exporter Services, in consultation with the

Director, Office of Export Enforcement, shall determine whether to deny

that person permission to apply for or use any license, including any

License Exception, issued pursuant to, or provided by, the Act or the

Regulations, and shall also determine whether to revoke any license

previously issued to such a person.

Having received notice of Summit Marketing, Inc.'s conviction for

violating the AECA, and following consultations with the Acting

Director, Office of Export Enforcement, I have decided to deny Summit

Marketing, Inc. permission to apply for or use any license, including

any License Exception, issued pursuant to, or provided by, the Act and

the Regulations, for a period of eight years from the date of its

conviction. The eight-year period ends on September 26, 2005. I have

also decided to revoke all licenses issued pursuant to the Act in which

Summit Marketing, Inc. had an interest at the time of its conviction.

Accordingly, it is hereby

Ordered

I. Until September 26, 2005, Summit Marketing, Inc., 52 Blackburn

Center, Gloucester, Massachusetts 01930, 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.

II. No person may do, directly or indirectly, any of the following:

A. Export or reexport to or on behalf of the denied person any item

subject to the Regulations;

B. Take any action that facilitates the acquisition or attempted

acquisition by a 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 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 the denied person of any item subject to

the Regulations that has been exported from the United States;

D. Obtain from the 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 the denied person, or

service any item, of whatever origin, that is owned, possessed or

controlled by the 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.

III. After notice and opportunity for comment as provided in

Section 766.23 of the Regulations, any person, firm, corporation, or

business organization related to Summit Marketing, Inc. by affiliation,

ownership, control, or position of responsibility in the conduct of

trade or related services may also be subject to the provisions of this

Order.

IV. This Order does not prohibit any export, reexport, or other

transaction subject to the Regulations where the only items involved

that are subject to Regulations are the foreign-produced direct product

of U.S.-origin technology.

V. This Order is effective immediately and shall remain in effect

until September 26, 2005.

VI. A copy of this Order shall be delivered to Summit Marketing,

Inc. This Order shall be published in the Federal Register.

Dated: May 11, 1998.

Eileen M. Albanese,

Director, Office of Exporter Services.

[FR Doc. 98-13288 Filed 5-18-98; 8:45 am]

BILLING CODE 3510-DT-M