83 FR 38123 - Denial of Export Privileges

DEPARTMENT OF COMMERCE
Bureau of Industry and Security

Federal Register Volume 83, Issue 150 (August 3, 2018)

[Federal Register Volume 83, Number 150 (Friday, August 3, 2018)]
[Notices]
[Pages 38123-38125]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-16678]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security

[Docket Number 17-BIS-0005]


Denial of Export Privileges

    In the Matter of: Narender Sharma Middle Bazzar, Rampur Bushahr 
Distt. Shimla (H.P.) 172 001 India, Hydel Engineering Products

[[Page 38124]]

Middle Bazzar, Rampur Bushahr Distt. Shimla (H.P) 172 001 India, 
Respondents; Order Activating Suspended Portion of Civil Penalty and 
Activating Suspended Denial of Export Privileges Against Narender 
Sharma and Hydel Engineering Products

    On August 31, 2017, I signed an order (the ``August 31, 2017 
Order'') approving the terms of the settlement agreement entered into 
in August 2017 (the ``Settlement Agreement'') between the Bureau of 
Industry and Security, U.S. Department of Commerce (``BIS''), and 
Narender Sharma (``Sharma'') and his company Hydel Engineering Products 
(``Hydel'' or ``Hydel Engineering'') (collectively, ``Hydel/Sharma'' or 
``Respondents''). The Settlement Agreement and the August 31, 2017 
Order relate to an enforcement action brought by BIS against Hydel and 
Sharma for conspiring to export items from the United States to Iran, 
including to an Iranian Government entity, without the required U.S. 
Government authorization, in violation of the Export Administration 
Regulations (the ``Regulations''), which issued under the authority of 
the Export Administration Act of 1979, as amended (the ``Act'').\1\
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    \1\ The Regulations are currently codified in the Code of 
Federal Regulations at 15 CFR parts 730-774 (2018). The Regulations 
issued under the Act, 50 U.S.C. app. 4601-4623 (Supp. III 2015). 
Since August 21, 2001, the Act has been in lapse and the President, 
through Executive Order 13222 of August 17, 2001 (3 CFR, 2001 Comp. 
783 (2002)), as extended most recently by the Notice of August 15, 
2017 (82 FR 39,005 (Aug. 16, 2017)), has continued the Regulations 
in effect under the International Emergency Economic Powers Act, 50 
U.S.C. 1701, et seq. (2012).
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    The Settlement Agreement and August 31, 2017 Order imposed on Hydel 
and Sharma a civil penalty of $100,000, for which they are jointly and 
severally liable. Hydel and Sharma were required to pay $30,000 of this 
amount to the U.S. Department of Commerce by no later than December 15, 
2017. Payment of the remaining $70,000 was suspended for a probationary 
period of five years from the date of the August 31, 2017 Order, after 
which it would be waived, provided that during this five-year 
probationary period, Hydel and Sharma made full and timely payment of 
$30,000 as set forth above, otherwise complied with the terms of the 
Settlement Agreement and the August 31, 2017 Order, and committed no 
other violation of the Act, the Regulations, or any order, license, or 
authorization issued thereunder.
    The Settlement Agreement and the August 31, 2017 Order also imposed 
a five-year denial of Hydel and Sharma's export privileges under the 
Regulations. This denial order was suspended pursuant to Section 
766.18(c) of the Regulations, subject to the same probationary 
conditions described above, including Hydel and Sharma's full and 
timely payment of $30,000 by December 15, 2017. If Hydel and Sharma 
failed to make such full and timely payment, the suspension could be 
modified or revoked by BIS and a denial order including a denial period 
of up to five years activated against Hydel and Sharma. Upon activation 
of the denial order, any license issued pursuant to the Act or 
Regulations in which Hydel or Sharma had an interest at such time would 
be revoked.
    BIS has brought to my attention that Hydel and Sharma have not paid 
the $30,000 that was due by December 15, 2017, and thus that Hydel and 
Sharma have violated one of the probationary conditions relating to the 
$70,000 suspended portion of the civil penalty and the suspension of 
the denial of their export privileges.
    In accordance with Sections 766.17(c) and 766.18(c) of the 
Regulations, I notified Hydel and Sharma, by letter dated February 12, 
2018, of the proposed activation of these suspended sanctions, and 
provided them with an opportunity to respond, including an opportunity 
to explain their failure to make the December 15, 2017 payment of 
$30,000, and to show why I should not activate the $70,000 suspended 
penalty amount, issue an active five-year denial order against them, or 
take both actions.
    Neither Hydel nor Sharma has responded to the February 12, 2018 
letter. The $30,000 civil penalty payment that was due by December 15, 
2017, also remains unpaid.
    Based on the totality of circumstances here, I have determined 
within my discretion that it is appropriate to activate the $70,000 
suspended portion of the civil penalty and to activate a denial order 
including a five-year denial period.
    It is therefore ordered:
    First, the suspension of the $70,000 suspended portion of the civil 
penalty set forth in the August 31, 2017 Order is hereby revoked, and 
that this now-activated $70,000 civil penalty amount shall be paid to 
the U.S. Department of Commerce within 15 days of the date of this 
Order. Hydel and Sharma are jointly and severally liable for payment of 
this amount, and continue to be jointly and severally liable for the 
$30,000 civil penalty amount they were required to pay by December 15, 
2017, along with any related interest, penalty, or administrative 
charge that has accrued or may accrue as a result of their failure to 
pay $30,000 by the December 15, 2017 due date.
    Second, pursuant to the Debt Collection Act of 1982, as amended (31 
U.S.C. 3701-3720E (2000)), the $70,000 civil penalty amount activated 
by this Order accrues interest as more fully described in the attached 
Notice, and if payment is not made by the due date specified herein, 
Hydel and Sharma will be assessed, in addition to the full amount of 
the civil penalty and interest, a penalty charge and an administrative 
charge, as more fully described in the attached Notice.
    Third, for a period of five years from the date of this Order, 
Hydel Engineering Products, with a last known address of Middle Bazzar, 
Rampur Bushahr Distt. Shimla (H.P.) 172 001, India, and Narender 
Sharma, with a last known address of Middle Bazzar, Rampur Bushahr 
Distt. Shimla (H.P.) 172 001, India, and when acting for or on their 
behalf, their successors, assigns, representatives, agents, or 
employees (each a ``Denied Person'' and collectively the ``Denied 
Persons''), 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 engaging in any 
other activity subject to the Regulations; or
    C. Benefitting 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.
    Fourth, that no person may, directly or indirectly, do any of the 
following:
    A. Export or reexport to or on behalf of a 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

[[Page 38125]]

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 a Denied Person of any item subject to 
the Regulations that has been exported from the United States;
    D. Obtain from a 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 a Denied Person, or 
service any item, of whatever origin, that is owned, possessed or 
controlled by a 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.
    Fifth, after notice and opportunity for comment as provided in 
Section 766.23 of the Regulations, any person, firm, corporation, or 
business organization related to a Denied Person by ownership, control, 
position of responsibility, affiliation, or other connection in the 
conduct of trade or business may also be made subject to the provisions 
of this Order.
    Sixth, any license issued pursuant to the Act or Regulations in 
which Hydel or Sharma has an interest of the date of this Order is 
hereby revoked.
    Seventh, this Order shall be served on Hydel and Sharma, and shall 
be published in the Federal Register.
    This Order is effective immediately.

    Issued on July 30, 2018.
Richard R. Majauskas,
Acting Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2018-16678 Filed 8-2-18; 8:45 am]
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