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MDHIAN 2665
9. WE BELIEVE THAT THE US HAS THREE AREAS OF CONCERN ABOUT THE JETPOWER CASE. FIRST, IF THE MAGNETRONS ARE US MADE, HOW DID THEY REACH CHINA QUERY. WERE THEY SUPPLIED BY US COMPANIES ACTING ILLEGALLY OFF THEIR OWN BAT, OR WERE THEY SUPPLIED WITH THE KNOWLEDGE OF THE US GOVERNMENT QUERY. SECONDLY, IF THEY ARE REVERSE ENGINEERED, HOW DID THE ORIGINAL REACH CHINA FOR THE COPIES TO BE MADE QUERY. DID THEY GO DIRECT TO CHINA OR COME FROM ANOTHER COUNTRY, POSSIBLY IRAN QUERY. AND, THIRDLY ARE THERE ANY LINKS TO THE FLORIDA GRAND JURY INVESTIGATION INTO JAE/HEIRAX QUERY.
10. OUR CONCERN IN THIS CASE IS THAT WHILST PUBLICITY ON THE SEALING OF A CONDUIT FOR ILLEGAL ARMS TRADE WITH IRAN CAN BE PRESENTED AS A SUCCESS STORY, EVIDENCE THAT THE CONDUIT HAD BEEN IN EXISTENCE FOR SEVERAL YEARS COULD DAMAGE HONG KONG'S REPUTATION FOR EFFECTIVE SECURITY EXPORT CONTROLS. WE WERE ONLY GRANTED ''INTER-COCOM TRADE STATUS'' EARLIER THIS YEAR AND DO NOT WANT TO LOSE IT. AND OTHER COUNTRIES MIGHT DECIDE NOT TO GRANT SUCH STATUS TO HONG KONG. PUBLICITY COULD ALSO CAUSE FRICTION BETWEEN THE US AND CHINA, WHICH COULD IMPACT ON US.
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I HAVE DECIDED THAT INVESTIGATIONS SHOULD CONTINUE, BUT THAT NO PROSECUTION ACTION WILL BE CONSIDERED UNTIL WE HAVE CONFIRMATION THAT THE MAGNETRONS ARE MISSILE PARTS. EVEN THEN A DECISION TO PROSECUTE WILL DEPEND ON THERE BEING ADEQUATE GROUNDS FOR THIS. I HAVE MADE IT CLEAR THAT POLITICAL CONSIDERATION SHOULD NOT BE ALLOWED TO PLAY ANY PART IN THIS DECISION. MY OBJECTIVE IS TO ENSURE THAT WE CANNOT IN ANY WAY BE ACCUSED OF COMPLICITY IN A COVER-UP WHICH COULD INVOLVE THE VERY HIGHEST US
THIS IS A COPY
THE ORIGINAL HAS BEEN
CLOSED UNDER
FOI EXEMPTION NO. 27(2)..
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