20-0728 Tuesday ” Daily Bugle “

20-0728 Tuesday “Daily Bugle”

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Tuesday, 28 July 2020

  1. State/DDTC: “30-Day Notice of Proposed Information Collection – Request for Advisory Opinion”
  2. Treasury/OFAC: “Notice of OFAC Sanctions Actions”
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings)
  3. State/DDTC: “ITAR – Notification of Temporary Suspension, Modification, or Exception to Regulations due to SARS-COV2”
  4. Treasury/OFAC: “Settlement Agreement between OFAC and Whitford Worldwide Company, LLC”
  5. UK DIT: “List of Goods Imported Into GB from the EU that Are Controlled”
  6. UK OFSI Updates Financial Sanctions – Guidance, FAQs and Information on Monetary Penalties
  1. 112.International: “Netherlands to Continue Supporting EU Sanctions Against Russia”
  2. EU Sanctions: “First transaction with Iran via Swiss/US Humanitarian Mechanism”
  3. Reuters: “More Than 40 Countries Accuse North Korea of Breaching U.N. Sanctions”
  1. Nicholas Turner: “Sanctions Top-5 for the Week Ending 24 July”
  2. ST&R Trade Report: “EU Claims Compliance in WTO Subsidy Case, Calls for End to U.S. Tariffs”
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Find the Latest Amendments Here. 
  3. Weekly Highlights of the Daily Bugle Top Stories 
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Federal Register
, 28 Jul 2020) [Excerpts]

85 FR 45458: Notice
* ACTION: Notice of request for public comment and submission to OMB of proposed collection of information.
* SUMMARY: The Department of State has submitted the information collection described below to the Office of Management and Budget (OMB) for approval…
* DATES: Submit comments up to August 27, 2020.
* ADDRESSES: Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to www.reginfo.gov/public/do/PRAMain. Find this particular information collection by selecting “Currently under 30-day Review-Open for Public Comments” or by using the search function.
* FOR FURTHER INFORMATION CONTACT: Direct requests … to Andrea Battista, who may be reached at BattistaAL@state.gov or 202-663-3136.

* Title of Information Collection: Request for Advisory Opinion.
* OMB Control Number: 1405-0174.
* Type of Request: Revision of a Currently Approved Collection.
* Originating Office: Directorate of Defense Trade Controls, Bureau of Political Military Affairs, Department of State (T/PM/DDTC).
* Form Number: DS-7786.
* Respondents: Individuals and companies registered with DDTC and engaged in the business of
* Abstract of Proposed Collection  . . .
     Sections 126.9 and 129.9 of the International Traffic in Arms Regulations (ITAR, 22 CFR 120-130) may be used by entities and individuals involved in the brokering, manufacture, export, and temporary import of defense articles and defense services to request an advisory opinion as to whether DDTC would be likely to grant a license or other approval for the export of a particular defense article or defense service to a particular country; for general or regulatory guidance; or whether certain activity constitutes brokering under the meaning of the ITAR.
Except for determinations made with reference to ITAR § 129.9(b), advisory opinions are not binding on the Department of State and may not be used in future matters before the Department. Users electronically submit requests for advisory opinions to DDTC via The Defense Export Control and Compliance System (DECCS) portal; users are able to retrieve responses using the same system. DDTC staff members have defined the data fields which are most relevant and necessary for requests for advisory opinions and developed the means to accept this information from the industry in a secure system. The revision of this information collection is meant to conform the current OMB approved data collection to DDTC’s new case management system.

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Federal Register
, 28 Jul 2020) [Excerpts]

85 FR 45469: Notice
* AGENCY: Office of Foreign Assets Control, Treasury.
* ACTION: Notice of OFAC Sanctions Actions
* SUMMARY: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is publishing the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List based on OFAC’s determination that one or more applicable legal criteria were satisfied. All property and interests in property subject to U.S. jurisdiction of these persons are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.
* FOR FURTHER INFORMATION CONTACT: OFAC: Associate Director for Global Targeting, tel.: 202-622-2420; Assistant Director for Licensing, tel.: 202-622-2480; Assistant Director for Regulatory Affairs, tel.: 202-622-4855; Assistant Director for Sanctions Compliance & Evaluation, tel.: 202-622-2490; or the Department of the Treasury’s Office of the General Counsel: Office of the Chief Counsel (Foreign Assets Control), tel.: 202-622-2410.

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Federal Register
* Treasury/OFAC: NOTICES; Blocking or Unblocking of Persons and Properties [Pub. Date: 29 Jul 2020] (PDF)
* State/DDTC: RULES; International Traffic in Arms Regulations: Temporary Suspension, Modification, or Exception to Regulations [Pub. Date: 29 Jul 2020] (PDF)

* * * * * * * * * * * * * * * * * * * *  

OGS_a24. Commerce/BIS: (No new postings)

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, 28 Jul 2020)
   On July 29, 2020, DDTC will publish in the
Federal Register
a document of certain temporary modifications, suspensions, and exceptions to the ITAR to allow continued telework operations during the current SARS-COV2 public health emergency. Originally published at paragraphs 3 and 4 of 
Federal Register
85 FR 25287, May 1, 2020, with a termination date of July 31, the Deputy Assistant Secretary for Defense Trade Controls ordered their extension until December 31, 2020. The notice makes no other revision to the notice published at 85 FR 25287 and the temporary suspensions, modifications, or exceptions regarding registrations and existing license durations. These actions are taken pursuant to ITAR §§ 126.2 and 126.3 and are in the interest of the U.S. Government and the security and foreign policy of the United States and will help to ensure continuity of operations within DDTC and among members of the regulated community.

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Treasury/OFAC, 28 Jul 2020)
  The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced a $824,314 settlement with Whitford Worldwide Company, LLC (“Whitford”).  Whitford, a cookware coating manufacturer headquartered in Elverson, Pennsylvania, has agreed to settle its potential civil liability for 74 apparent violations of the Iranian Transactions and Sanctions Regulations by Whitford and its subsidiaries in Italy and Turkey.  Specifically, between about November 2012 and December 2015, these subsidiaries sold coatings intended for customers in Iran and engaged in other trade-related transactions with Iran.  Additionally, U.S. persons employed by Whitford facilitated some of these transactions with Iran.  OFAC determined that Whitford voluntarily disclosed the apparent violations and that the apparent violations constitute a non-egregious case.  

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You’ll need to follow normal import declarations rules for controlled goods imported into Great Britain from the EU from 1 January to 30 June 2021.
From 1 January to 30 June 2021, if you import goods which are not controlled into Great Britain from the EU, you can 
record the goods in your own records without getting authorisation in advance
But if the goods are on the below list, you must follow 
normal rules for making import declarations

Read the full list here.

* * * * * * * * * * * * * * * * * * * *  

, 27 Jul 2020)
EU sanctions continue to apply in the UK until 11pm on 31 December 2020.
The general guidance document includes information regarding:
  • businesses’ obligations to financial sanctions regulations
  • OFSI’s processes for licence applications and breach reports
  • frequently asked questions by specific sector
Monetary penalty guidance
The guidance on monetary penalties outlines OFSI’s processes for issuing monetary penalties for financial sanctions breaches, including:
  • the case assessment process
  • penalty calculation process
  • procedural rights
FAQ guidance for the charity sector
The FAQ guidance for the charity sector helps clarify what activity may be permitted under an OFSI licence and how to apply. It also promotes various sources of information and advice available to charities and NGOs
Financial sanctions guidance in the UK: a quick guide
OFSI has also produced a quick guide which provides key information regarding the obligations of businesses and individuals in relation to financial sanctions.
FAQ guidance for the import and export sector
The FAQ guidance for the import and export sector helps clarify how financial sanctions differ from trade sanctions, including how to apply for a licence from OFSI and DIT.
UK Sanctions guidance
OFSI has also published 
UK financial sanctions: general guidance
. This will apply to any new sanctions regimes that the UK introduces during the transition period. This guidance does not currently apply to existing sanctions regimes which are operating under EU legislation until 31 December 2020.
OFSI has also published specific guidance in respect of the financial and investment restrictions in the 
Russia sanctions regime
. This guidance does not currently apply and would only come into effect on 1 January 2021, or when the 
Russia (Sanctions) (EU Exit) Regulations 2019
come into force. This is therefore for information only at this stage.
The guidance was updated with
the addition of
‘Maritime guidance’

* * * * * * * * * * * * * * * * * * * *  


112.International, 28 Jul 2020) [Excerpts]
   The Netherlands will continue supporting EU sanctions and putting international pressure on Russia until Crimea is returned to Ukraine and the Minsk agreements are fully implemented. The relevant statement was made by country’s ambassador to Ukraine Jennes de Mol at his meeting with Anton Korynevych, the Permanent Representative of the President of Ukraine in the Autonomous Republic of Crimea, his first deputy Darya Svyrydova, and deputy Tamila Tasheva.
   “The Netherlands does not recognize the annexation of Crimea and considers it to be a violation of international law. We will support the current sanctions until the violation stops and the Minsk agreements are fully implemented. Through our Human Rights fund, we support lawyers, civic activists, and families of political prisoners on the ground, and we will continue putting international pressure on Russia, according to our policy,” the message reads.

EU Sanctions
, 27 Jul 2020) [Excerpts]
   A Swiss pharmaceutical company has completed the first transaction with Iran under the Swiss Humanitarian Trade Arrangement (SHTA), which involved a shipment of medication to treat cancer. The State Secretariat for Economic Affairs (SECO)
that the operationalisation of the SHTA is on-going, but a number of other companies have been approved, and more companies will follow.
   The Swiss and US governments established the SHTA to allow banks and companies to engage in humanitarian-related trade with Iran via the US financial system to supply agricultural commodities, food, medicine, and medical equipment. It became operational in February 2020.

) [Excerpts]
   More than 40 countries accused North Korea on Friday of illicitly breaching a United Nations cap on refined petroleum imports and called for an immediate halt to deliveries until the end of the year, according to a complaint seen by Reuters.
   The 15-member U.N. Security Council imposed an annual cap of 500,000 barrels in December 2017 in a bid to cut off fuel for North Korea’s nuclear weapons and ballistic missile programs.
   But in a complaint to the U.N. Security Council North Korea sanctions committee, 43 countries – including the United States, Britain and France – said they estimated that in the first five months of this year Pyongyang had imported more than 1.6 million barrels of refined petroleum via 56 illicit tanker deliveries.
   The complaint said North Korean vessels continue to conduct ship-to-ship transfers at sea “on a regular basis as the DPRK’s primary means of importing refined petroleum.” North Korea’s formal name is the Democratic People’s Republic of Korea (DPRK).
   The countries asked the Security Council sanctions committee to make an official determination that North Korea had exceeded the cap and “inform member states that they must immediately cease selling, supplying, or transferring refined petroleum products to the DPRK for the remainder of the year.” …


Medium, 28 Jul 2020)
* Author: 
Nicholas Turner
, Esq., 852-5998-7559, 
Steptoe & Johnson HK 
  Here are five things that happened this week in the world of economic sanctions that I think you should know about:
   (1) The US Office of Foreign Assets Control (OFAC)
named two Venezuelan brothers as Specially Designated Nationals 
(SDNs) under Executive Order 13692 for their support of the Nicolás Maduro government and Maduro’s son, Nicolás Ernesto Maduro Guerra.
According to the OFAC news release
, Santiago Jose Moron Hernandez and Ricardo Jose Moron Hernandez conduct business on behalf of Maduro Guerra and also facilitated the sale of Venezuelan gold.
   (2) The US Commerce Department’s Bureau of Industry and Security (BIS)
added 11 Chinese companies
to the Entity List for being “implicated in human rights violations and abuses” in China’s Xinjiang Ughur Autonomous Region (XUAR). The targets include textile and apparel makers
accused of using forced labor in the XUAR
   (3) The US State Department
issued a US visa ban on the leader of the Chechen Republic, his wife, and his daughters
under Section 7031(c) of the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2020.
According to the State Department announcement
, Ramzan Kadyrov “is responsible for numerous gross violations of human rights dating back more than a decade, including torture and extrajudicial killings.”
   (4) The US Department of Justice (DOJ)
announced the extradition from Cyprus of two individuals
, including a Lebanese national accused of laundering drug proceeds on behalf of Hezbollah.
According to the DOJ news release
, the Lebanese individual was arrested after arriving at Cyprus’ Larnaca International Airport in March 2019.
   (5) Reuters
reported that 43 United Nations Member States filed a complaint to the Security Council committee on North Korea sanctions
alleging that North Korea has exceeded the annual cap on importation of refined petroleum set in
Security Council Resolution 2397 (2017)
of 22 December 2017.
   Bonus item: The US Court of Appeals for the Second Circuit
upheld the conviction of Turkish banker Mehmet Atilla
, who was released from US federal prison in July 2019 after serving time for
helping a client process Iran-related transactions through the US financial system
. While upholding the conviction, the Court also ruled that the lower court should not have instructed Atilla’s jury that trying to avoid the imposition of US secondary sanctions constituted a violation of the International Emergency Economic Powers Act (IEEPA), as argued by US prosecutors. (
Read the decision here
.) In another case, the US Southern District
dismissed charges against an individual
who had been found guilty of violating Iran-related sanctions after prosecutors withheld exculpatory evidence. (My colleagues at Steptoe were his defense lawyers – bravo to them!) (
Read about the case here.
   The HM Treasury’s Office of Financial Sanctions Implementation (OFSI) released its
Maritime Guidance
yesterday. More on this next week.

* Contact: 
, 1-305-894-1035
   The European Union is calling on the U.S. to remove its additional tariffs on imports of $7.5 billion worth of EU goods after claiming that Brussels has complied with a World Trade Organization ruling against subsidies provided to aircraft manufacturer Airbus. The U.S. has not yet commented on the EU’s assertion and is currently considering whether to modify the tariffs.
   According to an EU press release, the governments of France and Spain have agreed with Airbus to modify the terms of the repayable launch aid they granted for development of the A350 aircraft to reflect market conditions (reportedly, by increasing the interest rates). Because this action “addresses the last remaining measures condemned by the WTO,” the press release said, the EU, as well as France, Germany, and Spain individually, are now “in full compliance” with the WTO ruling.
   As a result, EU Trade Commissioner Phil Hogan insisted that the U.S. lift its “unjustified tariffs” immediately. If it does not, the EU said it “will act to exercise its own sanction rights” once the WTO rules on the level of countermeasures it may impose against the U.S. in a parallel case involving U.S. government aid to Boeing. That decision is not expected until this fall.
The Office of the U.S. Trade Representative had made no comment on the EU’s claim as of press time. Instead, USTR is considering whether to
modify the list
of EU goods currently subject to additional tariffs in this case by removing or adding items or increasing the tariff level to as much as 100 percent. Comments on such changes were due by July 27 and a decision could come in the next few weeks.


* * * * * * * * * * * * * * * * * * * *


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. 
22 Jul 2020: 85 FR 44159: Addition of Certain Entities to the Entity List; Revision of Existing Entries on the Entity List.

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

: DoD 5220.22-M. Implemented by Dep’t of Defense. 

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.)  
DOE ASSISTANCE TO FOREIGN ATOMIC ENERGY ACTIVITIES: 10 CFR Part 810.    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.



22 July 2020: 
85 FR 44188:
amending 126.1(u)
.  The latest edition of the
is 22 July 2020.


DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

17 Jul 2020:
85 FR 43436:
Nicaragua Sanctions Regulations. 


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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