20-0423 Thursday “Daily Bugle”

20-0423 Thursday “Daily Bugle”

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Thursday, 23 April 2020

[No relevant items for today]
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings.)
  3. DHS/CBP Publishes FAQ for 90 Day Postponement of Payment for the Deposit of Certain Estimated Duties, Taxes, and Fees
  4. State/DDTC: (No new postings.)
  1. CBC: “Canada Ban on Arms Sales to NATO Ally Turkey”
  2. ST&R Trade Report: “In the News– Export Controls, Tariff Eliminations”
  1. EU Sanctions: “Dutch Supreme Court Sends Ecuador Export Control Case Back to Lower Court”
  2. Husch Blackwell: “FEMA Issues Notification of Additional Exemptions to the Export Restrictions on PPE”
  3. R/D Report: “EAR Controls Over Parts, Components, Accessories & Attachments”
  4. Steptoe & Johnson: “US Civilian Firearms Exporters and Commerce Department’s New Rule”
  1. ECS Presents Webinar “ITAR/EAR Controls for Non-US Companies” on 24-25 Jun
  2. FCC Academy Presents: “An Introduction to EU/Dutch Dual-use and Military Export Controls”; 12 May
  3. FCC Academy Present: “U.S. Export Controls: ITAR, EAR, and FMS”
  1. Bartlett’s Unfamiliar Quotations
  2. Are Your Copies of Regulations Up to Date? Find the Latest Amendments Here.
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[No relevant items for today]

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Items Scheduled for Future Federal Register Editions
(Source: Federal Register)
* USTR; NOTICES; Product Exclusion: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation; [Pub. Date: 24 Apr 2020]  

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Commerce/BIS: (No new postings.)

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, 22 Apr 2020)
Effective April 20, 2020, the Secretary of the Treasury and U.S. Customs and Border Protection (CBP) have postponed for 90 calendar days the deadline for payment for the deposit of certain estimated duties, taxes, and fees for importers experiencing a significant financial hardship due to the coronavirus disease (COVID-19).  
CBP is regularly compiling and posting answers to Frequently Asked Questions regarding this temporary postponement on the CBP.gov 
COVID-19 Updates and Announcements
The trade community should monitor CSMS and the 
COVID-19 Updates and Announcements
webpage for additional changes related to COVID-19.  Policy questions should be directed to the Office of Trade, Trade Policy and Programs at 

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NWS_a15. CBC: “Canada Ban on Arms Sales to NATO Ally Turkey”

(Source: CBC, 22 Apr 2020) [Excerpts]
Canada’s ban on new arms exports to Turkey has been extended indefinitely, Global Affairs confirmed today. …
The government imposed a suspension on the approval of export permits last fall after Turkish forces launched an incursion into northern Syria. …
While some permit applications are reviewed on a case-by-case basis, the revised notification makes it clear that certain military items “will be presumptively denied” to Turkey. In other words, companies with those goods shouldn’t even bother applying for permission to sell them to Turkey.
‘Exceptional circumstances’
The items in question include ammunition, light weapons, armour, protective equipment and electronics. …
“Exceptional circumstances” related to Canada’s international alliance commitments might see the government consider issuing a permit, the notice said. …

NWS_a26. ST&R Trade Report:

“In the News: Export Controls, Tariff Eliminations”

Sandler, Travis & Rosenberg Trade Report
, 23 Apr 2020) [Excerpts]
EU to Limit Export Control of Virus Protection Gear to Just Masks
“The bloc’s current restrictions apply to protective spectacles and visors, face shields, protective garments, gloves, as well as mouth and nose masks. These products can only be exported to a non-EU country with an authorization granted by individual EU countries. The restrictions were due to run from March 15 to April 25.”
Europe Seeks
o Abolish Tariffs
n $597 Billion Medical Trade

“If successful, the initiative would represent the most significant effort to liberalize trade in medical goods at a moment when countries are hoarding critical health supplies. This year more than 70 countries have implemented barriers to trade in face masks, sanitizer, ventilators and other exports as the coronavirus pandemic whittled down national stockpiles of life-saving equipment.”
U.S. Asks China
o Revise Export Rules
or Coronavirus Medical Gear
“China tightened restrictions on exports of masks and other personal protective equipment (PPE) last Friday, calling for shipments of the items to be subjected to a mandatory customs inspection. It was a bid by China to balance the global demand for PPE to help treat the rising number of cases of the new coronavirus, while ensuring that manufacturers and sellers do not flood the market with uncertified or shoddy products.”
Antara News
Indonesia Exempts Import Duties
nd Import Tax
n Goods for COVID-19 
“With this latest regulation, imports of goods for handling COVID-19 such as imports of goods by the private sector that are used alone or imports of goods through individuals (shipment) and passenger luggage, are now facilitated.”


EU Sanctions: “Dutch Supreme Court Sends Ecuador Export Control Case Back to Lower Court”
EU Sanctions
, 22 Apr 2020)
* Principal Author:
Maya Lester
, QC, 44-20-7379-3550,
EU Sanctions
The Supreme Court of the Netherlands has referred a decision back to the Amsterdam Court of Appeal concerning the re-export of military goods (component parts for an Atlas Cheetah jet plane) to Equador without a licence, in contravention of Article 3.1 of 
General Customs Act.
The Court of Appeal had imposed a fine of €60,000 on the defendant (an unnamed air freight carrier). Case number: 18/05294, judgment 
(21 April 2020). The Court followed the Attorney General’s
(28 January 2020).
The Court held that the lower court had erred in inferring the defendant’s intention to export military goods without a licence from the defendant’s knowledge that the goods comprised aircraft parts intended for the Ecuadorian Ministry of Defence

COM_a28. Husch Blackwell: “FEMA Issues Notification of Additional Exemptions to the Export Restrictions on PPE”

Husch Blackwell
, 22 Apr 2020)
* Principal Author:
Beau Jackson, Esq., 1-816-983-8202,
Husch Blackwell LLP
As previously reported 
on April 10, 2010, the US Federal Emergency Management Agency (FEMA) issued a 
temporary final rule
restricting the export of certain types of personal protective equipment (PPE).  The temporary rule required FEMA approval before certain kinds of PPE could be exported from the United States.
On April 21, 2020, FEMA issued a 
Notification of Exemptions 
from the temporary final rule in the Federal Register, which took effect on April 17, 2020. The right to waive any of the exemptions is reserved for the Administrator of FEMA.  The exemptions are as follows:
Shipments to U.S. Commonwealths and Territories, Including Guam, American Samoa, Puerto Rico, U.S. Virgin Islands, and the Commonwealth of the Northern Mariana Islands (Including Minor Outlying Islands).
Exports of Covered Materials by Non-profit or Non-governmental Organizations that are Solely for Donation to Foreign Charities or Governments for Free Distribution (Not Sale) at their Destination(s).
Intracompany Transfers of Covered Materials by U.S. Companies from Domestic Facilities to Company-owned or Affiliated Foreign Facilities.
Shipments of Covered Materials that are Exported Solely for Assembly in Medical Kits and Diagnostic Testing Kits Destined for U.S. Sale and Delivery.
Sealed, Sterile Medical Kits and Diagnostic Testing Kits Where Only a Portion of the Kit is Made Up of One or More Covered Materials That Cannot be Easily Removed Without Damaging the Kits.
Declared Diplomatic Shipments from Foreign Embassies and Consulates to their Home Countries. These May be Shipped via Intermediaries (Logistics Providers) but are Shipped from and Consigned to Foreign Governments.
Shipments to Overseas U.S. Military Addresses, Foreign Service Posts (e.g., Diplomatic Post Offices), and Embassies.
In-Transit Merchandise: Shipments in Transit through the United States with a Foreign Shipper and Consignee, Including Shipments Temporarily Entered into a Warehouse or Temporarily Admitted to a Foreign Trade Zone.
Shipments for Which the Final Destination is Canada or Mexico.
Shipments by or on behalf of the U.S. Federal Government, including its Military.
For exemptions (2)-(4), (8) and (9), FEMA will require that exporters file a letter of attestation with U.S. Customs and Border Protection (CBP) that provides the following information:
A description of which exemption is being claimed.
Sufficient details CBP and FEMA officials to determine whether the shipment falls under the claimed exemption.
A statement that the provided information is true and accurate, and recognition that false information is subject to prosecution.

COM_a39. R/D Report: “EAR Controls Over Parts, Components, Accessories & Attachments” 

R/D Report
, 22 Apr 2020)
* Principal Author:
Johanna Reeves
, Esq., 1-202-715-9941,
Reeves & Dola, LLP
Though we have been socially distancing ourselves, we have not stopped digging into the rewrites of the U.S. Munitions List (USML) and the Commodity Control List (CCL) that became effective March 9, 2020. Specifically, we have spent some time digging into the treatment of “parts,” “components,” “accessories,” and “attachments” on the CCL and thought we would share some reminders.
First, as many of you are likely aware, the terms “parts,” “components,” “accessories,” and “attachments” are all defined in the Export Administration Regulations (EAR) in Part 772 as follows:
Part” is any single unassembled element of a “component,” “accessory,” or “attachment” which is not normally subject to disassembly without the destruction or the impairment of design use. Examples include threaded fasteners (e.g., screws, bolts, nuts, nut plates, studs, inserts), other fasteners (e.g., clips, rivets, pins), common hardware (e.g., washers, spacers, insulators, grommets, bushings), springs and wire.
Component” is an item that is useful only when used in conjunction with an “end item.” “Components” are also commonly referred to as assemblies. For purposes of this definition an assembly and a “component” are the same. There are two types of “components”: “major components” and “minor components.” A “major component” includes any assembled element which forms a portion of an “end item” without which the “end item” is inoperable. A “minor component” includes any assembled element of a “major component.” “Components” consist of “parts.” References in the CCL to “components” include both “major components” and “minor components.”
Accessories” are associated items for any “component,” “end item,” or “system,” and which are not necessary for their operation, but which enhance their usefulness or effectiveness. For purposes of this definition, “accessories” and “attachments” are the same.
Attachments” are associated items for any “component,” “end item,” or “system,” and which are not necessary for their operation, but which enhance their usefulness or effectiveness. For purposes of this definition, “attachments” and “accessories” are the same.
Because each Export Control Classification Number (ECCN) on the CCL specifically enumerates what it controls, it is critical to understand these definitions (including “specially designed”) and apply them to the products you are classifying. It is also important to remember that you should classify at the highest level of assembly that is being exported. For example, if you are exporting a barrel with a flash suppressor attached, you would classify the barrel. Conversely, if you are exporting only a flash suppressor, you would classify just the flash suppressor for export. We will stick with flash suppressors to highlight the importance of the parts, components, accessories, and attachments definitions.
Under the old export control regime, a flash suppressor was classified as USML Category I(e) and was also considered Significant Military Equipment (SME). Now, after the rewrite, that flash suppressor has moved off the ITAR and is now subject to the EAR. ECCN 0A501 controls firearms and related commodities, so to determine the jurisdiction of a flash suppressor, one would start with a review of ECCN 0A501.  Those firearm parts, components, accessories and attachments that are controlled by ECCN 0A501 are enumerated in the following subparagraphs:  
0A501.c – captures “parts” and “components” “specially designed” for firearms in 0A501 paragraphs .a or .b, but only such parts and components that are specifically enumerated in the control paragraph.  
0A501.x – captures “parts” and “components” that are “specially designed” for firearms and not elsewhere listed on the CCL or USML.  
0A501.y – captures “parts”, “components”, “accessories”, and “attachments” “specially designed” for items in 0A501 that are specifically listed in the .y subparagraphs.  
To determine which of these subparagraphs may apply, you must determine whether a flash suppressor is a “part,” “component,” “accessory,” or “attachment” as defined in the EAR. As you can see by the control paragraphs, the only subparagraph of ECCN 0A501 that controls “accessories” or “attachments” is the “.y” paragraph. Stated differently, the only accessories or attachments controlled in ECCN 0A501 are the seven (7) at are specifically enumerated in “.y”. Therefore, it is imperative you determine which definition most appropriately describes your item to know which control paragraph is applicable.  
After a review of the definitions, a flash suppressor is best described as an “accessory” or “attachment.” As noted, above, “.y” controls only those items that are specifically listed. Flash suppressors are not enumerated in “.y”. Following the Order of Review, you would need to see if flash suppressors are captured in another ECCN. They are not. Therefore, flash suppressors are now classified as EAR99 items.
As shown by the analysis above, there can be risk in loosely calling your item a part or component as you may be unnecessarily over-controlling for export licensing purposes. While there is no difference in licensing requirements between 0A501.c and 0A501.x (a license or other authorization is required for all countries in the world), there is a big difference for the “.y” paragraph. The “.y” items only require a license for those countries controlled for AT (Anti-Terrorism) or UN (United Nations) reasons, which is a very limited number of countries.  
This quick review illustrates the importance of EAR definitions and closely reading the control paragraphs. While most new ECCNs created as part of the Export Control Reform (ECR) process include a catch all for parts, components, accessories, and attachments, not all do. ECCN 0A501 is one example of this, but there are others, such as ECCNs 0A505 and 0A602. It may seem tedious, but take the time to carefully walk through the reclassification process. You may find some surprises too.


Steptoe & Johnson: “US Civilian Firearms Exporters and Commerce Department’s New Rule”

Steptoe & Johnson
, 22 Apr 2020)
* Principal Author:
Jeff Beatrice
, Esq., 1-202-429-6260,
Steptoe & Johnson LLP
On March 9, 2020, a new US federal firearms export control rule (the Rule) that has been in the works for many years went into effect, changing the way the United States regulates international trade in firearms, guns, ammunition and related articles. Essentially, the Rule makes the US Commerce Department responsible for the regulation of most commercially available firearms exports and enforcement of those regulations, rather than the US State Department. While the Rule should come as a welcome relief to firearms manufacturers and dealers, as it will reduce the procedural burdens and costs of export compliance, it does not deregulate the items transferred to Commerce. In fact, Commerce is expected to be just as exacting in its civil/administrative regulation of the firearms trade, and just as tough in criminal enforcement.
Dating back to the Obama Administration and carrying through to the Trump Administration, the new Rule follows an earlier determination made by several US Government agencies that strict controls previously applied to many civilian firearms under the State Department’s United States Munitions List (USML) were no longer warranted. Instead, these types of products would be more appropriately regulated by the Department of Commerce’s Bureau of Industry and Security (BIS) on the Commerce Control List (CCL), under the Export Administration Regulations (EAR).
The EAR rule is available

A companion rule amending the International Traffic in Arms Regulations (ITAR) to move these items off of the USML (and describing more precisely the articles warranting continued control on that list) is available 
The transferred items generally include: firearms, close assault weapons and combat shotguns (formerly under USML Category I); guns and armament (formerly under USML Category II); and ammunition/ordnance (formerly USML Category III).  The Rule moved from the USML to the CCL such items that are not inherently military and do not otherwise warrant control on the USML because they provide a critical military or intelligence advantage to the United States.
The civilian firearms industry has generally applauded this change, which will result in a more flexible licensing system and ease certain aspects of the regulatory burden on civilian firearms manufacturers and dealers, who, by and large, engage in the export of commercial items available in retail outlets and less sensitive military items.  Listing these product types on the USML, administered by the State Department’s Directorate of Defense Trade Controls (DDTC), has been historically viewed by the industry as confusing and overly complex, with a burdensome licensing system.  Additionally, registration fees of at least $2,250 per year imposed unnecessary costs, particularly for small-to-medium-sized companies.  With Commerce/BIS, no registration is required, eliminating registration fees and associated burdens such as requirements to inform the agency of each material change to a company’s registration information.
Enforcement by Commerce
BIS has a long history of implementing and enforcing export controls on most commercial items and many military items, particularly items that have both a commercial and military use (so-called “dual use” items) including goods/hardware, software, and technology.  BIS will require licenses to export or reexport to any country firearms or other weapons previously listed on the USML and now added by the Rule to the CCL (although some parts and components will not require licenses in certain instances).  While no licensing fees will be assessed by BIS, its licensing process requires the exporter to specify the particular items, quantity, customer, end-user and other details for each transaction.  Moreover, DDTC will continue to regulate “brokering” activity relating to these items on the CCL if they are also subject to the import regulations of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
Criminal enforcement of the Rule will move from the investigations unit (the HSI) of the US Department of Homeland Security (DHS) (within the Immigration and Customs Enforcement (ICE) agency) to Commerce’s Office of Export Enforcement (OEE) under BIS.  Unlike Commerce, State does not have its own enforcement arm to investigate criminal cases, so ICE’s HSI is the primary investigative agency for violations of the ITAR, whereas Commerce can handle most investigations of EAR violations in-house.
On first blush, having Commerce agents rather than ICE agents conducting investigations may not appear to be a significant change, but OEE has extensive experience in export enforcement and is a robust investigatory agency.  OEE has strong partnerships in the export business community and the shipping industry and coordinates and works effectively with other law enforcement agencies such as the Federal Bureau of Investigation (FBI), and DHS’s Customs & Border Protection agency (CBP).  OEE has a significant budget and a large number of specialized agents committed to preventing export control violations, and pursuing civil (or administrative) and criminal enforcement actions, utilizing all of the investigative techniques available to other federal law enforcement agencies. In fact, OEE 
recently gained new enforcement authorities
needed to conduct effective undercover operations, such as setting up wiretaps, leasing space, establishing business entities, and other steps.
Given the long history of the new Rule, BIS may be particularly sensitive to criticisms of the change by those expressing concern that moving these firearms and related items from the USML to the CCL would result in lax enforcement of export control violations for firearms.  On the contrary, OEE has investigated extraordinarily complex and serious cases, focusing on violations posing the most significant threats to US national and homeland security, foreign policy and economic interests, primarily those involving unauthorized dual-use exports for military purposes.  OEE agents work hand-in-hand with US Attorney’s Offices to pursue criminal prosecutions.  Over the years OEE has become adept at developing leads gleaned from industry and confidential sources. While many OEE investigations have involved heavily restricted and sensitive jurisdictions-e.g., Iran, North Korea, and Sudan- OEE has also brought many cases involving major US trading partners.  The office’s resume includes investigations of attempts to export items controlled for nuclear non-proliferation reasons, including instances of nuclear-related dual-use equipment that could have been used to enrich uranium or as triggering devices in nuclear weapons, as well as  numerous cases involving the illegal transfer of computer components, sophisticated electronics, and aerospace products, including restricted thermal imaging technology and technical data for unmanned aerial vehicles to China and other countries.  Some of the OEE’s most recognized cases have involved the shipment of components for improvised explosive devices (IEDs) to Iran and Iraq.  OEE agents are known for their skills in forensic analysis, including computer analysis, and in-depth review of voluminous business and shipping records. Vigorous enforcement under the new Rule by OEE should be expected.
The penalties under the EAR remain severe: criminal penalties can include up to 20 years of imprisonment for individuals and up to $1 million in fines per violation, or both; civil monetary penalties can reach up to $307,992 per violation or twice the value of the transaction, whichever is greater. (The maximum civil penalty per violation
is adjusted annually for inflation
.) BIS may also limit a company’s ability to export goods from the United States through orders denying export privileges.  Finally, a company may be required to extensively remediate its export control compliance program and face ongoing audits as part of any settlement agreement entered into with Commerce to resolve violations of the EAR.
Companies impacted by the Rule are strongly urged to evaluate their export control compliance programs sooner rather than later, incorporating new processes and procedures required under Commerce regulations, and to seek counsel when encountering an OEE administrative or criminal inquiry or investigation.  Finally, companies should familiarize themselves with Commerce’s voluntary self-disclosure rules and guidelines for potential violations, as well as those of the US Department of Justice (DOJ) for potential criminal violations.


*What:  ITAR/EAR Controls for Non-U.S. Companies
*When: 24-25
*Sponsor: Export Compliance Solutions & Consulting
*Presenter: Suzanne Palmer, Mal Zerden

 or call 866-238-4018 or email 
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12. FCC Academy Presents Webinar: “An Introduction to EU/Dutch Dual-use and Military Export Controls“; 12 May

* What: Introduction to EU / Dutch Dual-Use and Military Export Controls
* When: 12 May 
* Where:  Online
* Sponsor: FCC Academy 
* Presenter: Marco F.N. Crombach MSc (Director)
* Register: 

, and email

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FCC Academy
Presents June Webinars
: U.S. Export Controls: ITAR, EAR, and FMS


EN_a114. Bartlett’s Unfamiliar Quotations

(Source: Editor)


William Shakespeare (23 April 1564 – 23 April 1616) was an English poet, playwright, and actor, widely regarded as the greatest writer in the English language and the world’s pre-eminent dramatist. His extant works, including collaborations, consist of approximately 39 plays, 154 sonnets, two long narrative poems and a few other verses, some of uncertain authorship. His plays have been translated into every major living language and are performed more often than those of any other playwright. Shakespeare is the most quoted person in the English language.)
  – “All the world’s a stage, and all the men and women merely players: they have their exits and their entrances; and one man in his time plays many parts, his acts being seven ages.”
  – “How poor are they that have not patience! What wound did ever heal but by degrees?”
  – “Things won are done, joy’s soul lies in the doing.”  
* Kehlani
(Kehlani Ashley Parrish, born 23 April 1995; is an American singer, songwriter, and dancer. Kehlani achieved initial fame as a member of the teen group Poplyfe.)
  – “If my eyebrows are cool, if my eyeliner is popping, if I’m moisturized, then I can pretty much wear whatever I want. I think if your hair and your face are together, I think it’s pretty much polished!”

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The official versions of the following regulations are published annually in the U.S. Code of Federal Regulations (C.F.R.), but are updated as amended in the Federal Register.  The latest amendments are listed below.
Latest Update 
: 19 CFR, Ch. 1, Pts. 0-199.
5 Apr 2019:84 FR 13499: Civil Monetary Penalty Adjustments for Inflation.


24 Feb 2020:
85 FR 10274
: Amendments to Country Groups for Russia and Yemen Under the Export Administration Regulations.


DOC FOREIGN TRADE REGULATIONS (FTR): 15 CFR Part 30.   Last Amendment: 24 Apr 2018: 83 FR 17749: Foreign Trade Regulations (FTR): Clarification on the Collection and Confidentiality of Kimberley Process Certificates.


18 May 2016: Change 2: Implement an insider threat program; reporting requirements for Cleared Defense Contractors; alignment with Federal standards for classified information systems; incorporated and cancelled Supp. 1 to the NISPOM (Summary here.)  

23 Feb 2015: 80 FR 9359, comprehensive updating of regulations, updates the activities and technologies subject to specific authorization and DOE reporting requirements. 

15 Nov 2017, 82 FR 52823: miscellaneous corrections include correcting references, an address and a misspelling.


DOJ ATF ARMS IMPORT REGULATIONS: 27 CFR Part 447-Importation of Arms, Ammunition, and Implements of War.

14 Mar 2019: 84 FR 9239: Bump-Stock-Type Devices.

DOS INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (ITAR): 22 C.F.R. Ch. I, Subch. M, Pts. 120-130.  26 Dec 2019: 84 FR 70887; 23 Jan 2020: 85 FR 3819: Encryption rule and USML Categories I, II, III, and related sections regarding guns & ammo. 
DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

13 Mar 2020:
85 FR 14572:
General Licenses Issued Pursuant to Venezuela-Related Executive Order 13835.


1 Jan 2019: 19 USC 1202 Annex.
  – HTS codes for AES are available here.
  – HTS codes that are not valid for AES are available here.

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