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id: 43133 date: 10/20/2005 6:52 refid: 05SOFIA1808 origin: Embassy Sofia classification: SECRET destination: 05STATE154646 header: This record is a partial extract of the original cable. The full text of the original cable is not available. ----------------- header ends ---------------- S E C R E T SOFIA 001808 SIPDIS E.O. 12958: DECL: 10/20/2015 TAGS: PARM, PREL, MASS, MARR, BG SUBJECT: BULGARIA CONFIRMS MANPADS COMPONENTS SHIPPED, CLAIMS MISUNDERSTANDING REF: STATE 154646 Classified By: DCM Jeffrey D. Levine for reasons b, c, and d 1. (S) SUMMARY: The GOB confirmed that 50 MANPADS components were shipped to Egypt after the conclusion of a U.S.-Bulgarian bilateral agreement intended to take Bulgaria out of the commercial MANPADS business. The GOB maintains it never committed to preventing this sale and claims a misunderstanding has occurred. Further guidance requested. (See para 7). END SUMMARY. 2. (S) DCM and Poloff delivered reftel demarche to multiple deputy minister and working-level contacts in the GOB in late August and early September. Ms. Ivelina Bahchevanova, Director for Defense and Economic Cooperation and Internationally Controlled Trade in the Ministry of Economy and Energy, confirmed October 18 that the Bulgarian company Samel-90 and the Egyptian MOD had signed a contract for 300 Strela-2M gripstocks (part number 9P58) substantially prior to the exchange of diplomatic notes between the USG and the GOB concerning MANPADS on January 21, 2005. To date, 50 units have been shipped. The contract did not include any complete systems, missiles, explosive material, or electronic parts. The Bulgarian Commission for Control of Foreign Trade Transactions with Arms and Dual-Use Goods and Technologies has temporarily suspended the export license for this contract, and, in Bahchevanova's personal opinion, the remaining 250 units can be a subject for consultation between the USG and the GOB. However, she added that the customer does not appear interested in purchasing the remaining 250 units. 3. (S) The decision to grant an export license for this contract was initially suspended during negotiations with the USG on the MANPADS agreement. Bahchevanova said that the MFA had addressed this contract with the "State Department or the American Embassy," but she was unable to confirm where or with whom, and that the MFA had received no response. The Commission discussed this contract several times and decided to grant an export license for the following reasons: 1) the nature of the goods - non-explosive, non-electronic, and 2) no intermediary company or broker was involved. 4. (S) Bahchevanova recalled the April 11 meeting in which she and Christo Atanasov, also from her office, met with Poloff's predecessor. According to our records, Ministry officials Bahchevanova and Atanasov informed Poloff's predecessor that the GOB would not approve this transfer. However, she claimed that, "Neither I nor Christo promised anything. It was not in our mandate at the working level to do so." She said that she had reviewed her meeting notes, which she passed to her deputy minister and minister, and she asserted that no assurances were given and claimed there was "some kind of misunderstanding." 5. (S) Bahchevanova gave Poloff copies of the following documents: 1) an end-user certificate from the Egyptian MOD; 2) a delivery verification certificate for 50 units from Arab International Optronics, which she described as an Egyptian Government-owned company, stating the end user was the Egyptian MOD; and 3) a three-page document in Arabic pertaining to the sale bearing the stamp of the Bulgarian Embassy in Cairo. 6. (S) Bahchevanova expressed her personal opinion that the USG and the GOB should formalize the consultation process and create some sort of written record of the final GOB decision in cases such as this to avoid future misunderstandings. (Note: The GOB has had a draft consultation procedure from us since the diplomatic notes were exchanged in January, but has yet to formally accept it. In conjunction with our multiple demarches, we again presented copies of the proposed consultation procedure). Bahchevanova added that it was possible there might never be another instance in which the GOB would want to export MANPADS or MANPADS components. Poloff asked Bahchevanova to continue the export license suspension until she heard back from us. She agreed. 7. (S) COMMENT: The GOB's decision to proceed with this contract despite USG objections is disappointing. However, we do not expect the GOB to make a habit of evading the spirit of the agreement in the future. It appears that this transaction was allowed to proceed, in part, because it originated prior to the exchange of diplomatic notes. We will use this opportunity to push the GOB to formally accept a structured consultation process. We suggest Washington provide instructions requesting the approved export license be cancelled in the spirit of our agreements. Additional talking points supporting this position are requested. LEVINE
