Commerce Takes Action Against Chinese Exporters

0 Comments | Insight on the News, Nov 13, 2000 | by Jamie Dettmer

China is at it again, seeking to secure dual-use technology by violating Department of Commerce controls on the exporting of items that have both commercial and military applications. This time the target was U.S. microwave-assembly technology, specifically detector log video amplifiers (DLVAs), components used in radar, early-warning systems, electronic warfare and electronic countermeasures.

And the effort was successful, but at a cost. In October, the Department of Commerce indicted Santa Clara, Calif.-based businessmen Charlie Kuan and Jason Liao and their respective companies, Suntek Microwave Inc. and Silicon Telecom Industries Inc., on nine counts of violating U.S. export regulations.

According to the indictment in the Northern District of California, Kuan and Liao exported to China Suntek-made DLVAs between May 1996 and June 1998. On one occasion they were hand-carried to China by Liao; in five other cases they were sent via Federal Express to a Chinese company in Chengdu called Jeway Telecom, which is controlled by the Southwest Institute of Electronics Engineering, a Chinese government entity. Jeway owns 50 percent of Suntek.

Further, the indictment alleges that Suntek trained three Chinese nationals in the DLVA manufacturing process "for the purpose of permitting those individuals to learn the technology" -- a breach of "deemed-export" rules.

Under Bureau of Export Administration regulations, the Commerce Department controls the export of dual-use goods, technology and software. The regulations mostly apply to the actual export of items out of the United States, but they also can be applied to the release of technology and information to a foreign national within the United States -- or what is called a "deemed export."

The October indictment marks the first time the Commerce Department has sought an indictment involving the breach of deemed-export rules.