Israeli dronemaker allowed to renew sales to Azeris, but top officials suspended

The Israeli Defense Ministry on Monday allowed an aircraft manufacturer suspected of testing one of its “suicide drones” against the Armenian military on behalf of Azerbaijan in 2017, in violation of Israeli law, to again sell the unmanned aerial vehicles to the Azeris.

At the same time, the export licenses of three senior officials from the defense contractor Aeronautics Ltd. — CEO Amos Matan, deputy CEO Meir Rizmovitch and a third, unnamed, employee — were to be suspended by the Defense Ministry beginning in April, The Times of Israel reports, citing the company.

The announcement was made after the Defense Ministry said last week that it had decided to revoke the export licenses of the three senior officials.

Many details of the case were suppressed under a court-issued gag order, which remained in place as of Monday.

The Defense Ministry’s decision came three weeks after the Rafael defense contractor agreed to purchase Aeronautics for NIS 850 million ($231.7 million).

In August 2017, reports emerged that the company was suspected of using the Orbiter 1K kamikaze drone to attack Armenian forces in the disputed Nagorno-Karabakh region during a demonstration for Azeri officials. A copy of the complaint was first leaked to the Maariv newspaper.

A week and a half after the allegation came to light, the Defense Ministry announced it was suspending Aeronautics’ export license to Baku — identified by the company only as “central client ‘A,'” per the gag order.

In August 2018, the State Attorney’s Office also announced that it intended to indict Matan, Rizmovitch, and other senior officials in the company in connection with the alleged illegal live-fire test.

A statement announcing the plans to summon the company members said they were suspected of fraud as well as other violations of the Defense Export Control Law, which protects against unauthorized exports of defense intelligence and equipment.

“We are convinced that after we first present our position at the hearing, the State Prosecutor’s Office will reach an informed decision that there is no reason to put the company or any of its officers in court and will order the case closed,” the company said in August 2018.

The Israel Police’s Unit of International Crime Investigations, the Defense Ministry’s investigation unit and the State Attorney’s Office were leading the investigation into Aeronautics’s conduct.

On Monday, the company informed the Tel Aviv Stock Exchange that the ban on sales of its Orbiter 1K kamikaze drone to its “central customer ‘A'” had ended.

“The Defense Ministry announced to the company that the suspension of its license was immediately canceled. The company can continue to supply the UAV to the aforementioned customer as soon as possible,” Aeronautics wrote.

The company also said the CEO, deputy CEO and third official were indeed being removed from the company’s export license beginning on April 3.

“This temporary suspension will remain in place until a decision is made to file or not file an indictment against the employees. Once the aforementioned decision is made, the temporary suspension will be reconsidered,” Aeronautics said.

The drone manufacturer is accused of sending a team to the Azerbaijan capital Baku to demonstrate the Orbiter 1K unmanned aerial vehicle, which can be outfitted with a small explosive payload of 2.2 to 4.4 pounds (one to two kilograms) and flown into an enemy target on a “suicide” mission.

According to the complaint against the company, while demonstrating the kamikaze drone to the Azerbaijani military in July 2017, the company was asked to carry out a live-fire test of the system against an Armenian military position. The two countries have been been fighting sporadically for nearly 25 years.

Such a test would be illegal under Israeli law, as it would require a seldom-granted permit to carry out demonstrations against real targets. In this case, Aeronautics Defense Systems would have been even less likely to receive such a permit, as Israel does not consider Armenia to be an enemy state.

The two Israelis operating the two Orbiter 1K drones during the test refused to carry out the attack, despite threats from their superiors, Maariv reported.

Two higher-ranking members of the Aeronautics Defense Systems delegation in Baku then attempted to carry out the Azerbaijani request, but, lacking the necessary experience, did not directly hit their targets, the report said.

The Yavneh-based Aeronautics denied the assertion when reports first came out, saying it “has never carried out a demonstration against live targets, including in this case.”

Aeronautics Defense Systems, which specializes in UAV technology, manufactures other drones that are similar to the Orbiter 1K, but lack its attack capabilities and can only be used for reconnaissance. Azad Systems, a subsidiary of Aeronautics Defense Systems that is run by the Azerbaijani defense ministry, currently manufactures at least two models of the Orbiter platform. Azerbaijani news outlets have reported that the country has its own Orbiter kamikaze drones as well.

In 2016, Azerbaijan used another Israeli kamikaze drone, an Israeli Aerospace Industries Harop-model, in an attack on a bus that killed seven Armenians.

The Armenian National Committee of America has strongly condemned the move.

Azerbaijan is one of the largest importers of Israeli military equipment and is seen as an important ally to the Jewish state, given that it shares a border with Israel’s nemesis, Iran, and provides between 25 to 40 percent of Israel’s oil. In 2016, the country’s president, Ilham Aliyev, revealed Azerbaijan had purchased some $5 billion worth of weapons and defense systems from Israel.

Israel has come under internal criticism for its cooperation with Azerbaijan over the country’s reported human rights violations, despite it being one of the few majority-Muslim countries with which Israel enjoys an openly positive relationship.