20-0921 Monday “Daily Bugle”

20-0921 Monday “Daily Bugle”

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Monday, 21 September 2020

  1. Treasury/OFAC: “Blocking or Unblocking of Persons and Properties”
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: Commerce: “Statement on Delayed Prohibitions Related to TikTok”
  3. State/DDTC: “Outage Notice”
  4. Treasury/OFAC: “Statement on TikTok from Treasury Spokesperson Monica Crowley”
  1. Deutsche Welle: “FinCEN Files: Deutsche Bank Tops List of Suspicious Transactions”
  2. EU Sanctions: “US Tries to Trigger Snapback of UN Sanctions”
  3. Safehaven: “New TikTok Deal Hopes to Bypass National Security Concerns”
  1. BakerMcKenzie: “China amends Catalogue of Technologies Prohibited or Restricted from Export”
  2. Sidley: “New Rules on CFIUS Mandatory Filings”
  3. Steptoe: “New Orders Issued Barring Imports into the US from Certain Xinjiang-Related Entities”
  1. Monday List of Ex/Im Job Openings: 57 Available – 10 New Job Openings This Week
  1. ECS Presents: 15-16 Oct; “ITAR/EAR Controls for Non-US Companies”
  2. FCC Academy Presents 4 Webinars: U.S. Export Controls: ITAR & EAR | FMS | Designing and Implementing an ICP
  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 
  4. Submit Your Job Opening and View All Job Openings 
  5. Submit Your Event and View All Approaching Events 

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load to your laptop to keep you updated on the latest amendments, and contain over 800 footnotes of section history, key cases, practice tips & tricks, and extensive Tables of Contents. The ITAR amendments to the ITAR that took effect on 9 March and 25 March are included in the current edition of the BITAR.  Subscribers receive updated editions every time the regulations are amended (usually within 24 hours) so you will always have the current versions of the regulations. Subscribe to the BITAR here to guarantee you have an up-to-date ITAR!    


(Source: Federal Register) [Excerpts]

85 FR 59371: Notice
* AGENCY:Office of Foreign Assets Control, Treasury.
* ACTION:Notice.
* SUMMARY:The 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.

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* Commerce/Office of the Secretary; RULES; Identification of Prohibited Transactions to Implement Executive Order 13942 and Address the Threat Posed by TikTok and the National Emergency with Respect to the Information and Communications Technology and Services Supply Chain; [Pub. Date: 22 Sep 2020] (PDF)
* Commerce/Office of the Secretary; RULES; Identification of Prohibited Transactions to Implement Executive Order 13943 and Address the Threat Posed by TikTok and the National Emergency with Respect to the Information and Communications Technology and Services Supply Chain; [Pub. Date: 22 Sep 2020] (PDF)
* Treasury/OFAC; NOTICES; Blocking or Unblocking of Persons and Properties; [Pub. Date: 22 Sep 2020] (PDF) (PDF)
* Commerce/BIS; RULES; Addition of Entities to the Entity List:Corrections to Certain Existing Entries on the Entity List; [Pub. Date: 22 Sep 2020] (PDF) (PDF)
* USTR; NOTICES; Product Exclusion Extensions: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation; [Pub. Date: 22 Sep 2020] (PDF)

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(Source: Wilbur Ross, Commerce/BIS, 19 Sep 2020)
In light of recent positive developments, Secretary of Commerce Wilbur Ross, at the direction of President Trump, will delay the prohibition of identified transactions pursuant to Executive Order 13942, related to the TikTok mobile application that would have been effective on Sunday, September 20, 2020, until September 27, 2020 at 11:59 p.m.

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(Source: State/DDTC)
The Defense Export Control and Compliance System (DECCS) Registration and Licensing applications will be unavailable to industry from 6:00 AM (EDT) through 8:00 AM (EDT) Tuesday, September 22 for scheduled system maintenance. Please ensure work in progress is saved prior to the scheduled

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(Source: Treasury/OFAC, 19 Sep 2020)
The President has reviewed a deal among Oracle, Walmart, and TikTok Global to address the national security threat posed by TikTok’s operations. Oracle will be responsible for key technology and security responsibilities to protect all U.S. user data. Approval of the transaction is subject to a closing with Oracle and Walmart and necessary documentation and conditions to be approved by CFIUS.  

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(Source: Deutsche Welle, 20 Sep 2020) [Excerpts]
Germany’s largest bank Deutsche Bank is no stranger to scandals. But the leaked FinCEN files suggest the bank was aware of facilitating suspicious transactions amounting to over $1 trillion dollars, including for a period after it had promised to clean up its act. The FinCEN files are a huge cache of secret reports detailing suspicious financial activity, filed by banks to the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Treasury Department (USTD).
German bank reports over half of all suspicious activity Deutsche Bank accounts for 62% of all Suspicious Activities Reports (SARs) filed to FinCEN in the leaked documents. 
These SARs reflect the concerns of watchdogs within banks and are not necessarily evidence of any criminal conduct or wrongdoing. Financial institutions operating in the US are required to file these reports with the USTD, and failure to do so can result in penalties.

(Source: EU Sanctions, 21 Sep 2020)
On Saturday, the US announced that “virtually all previously terminated UN sanctions” on Iran, including the arms embargo, have been re-imposed pursuant to UN Security Council Resolution 2231.
On 20 August, the US had notified the UN Secretary General of its intention to initiate the snapback mechanism under that resolution because of Iran’s “significant non-compliance” with the JCPOA. See previous post and post for more information. Listen to Maya Lester QC’s interview with Al-Jazeera on the US attempt to trigger that snapback here.
The US State Department’s press release says it expects UN member states to comply with the arms embargo and other sanctions the US says have been re-imposed, and that if they fail to do so, US secondary sanctions will be imposed.
The E3 have made a statement reiterating their position that because the US stopped participating in the nuclear deal in May 2018, “the purported notification under paragraph 11 of UNSCR 2231 (2015), received from the United States of America and circulated to the UN Security Council Members, is incapable of having legal effect” and “any decisions and actions which would be taken based on this procedure or on its possible outcome would also be incapable of having any legal effect”. Statement from Josep Borrell, High Representative and JCPOA coordinator here.
UN Secretary General Antonio Guterres said in a press conference that it is for the Security Council to decide on the interpretation of Security Council resolutions. He said in a letter that “there would appear to be uncertainty whether or not the process […] was indeed initiated and concomitantly whether or not the (sanctions) terminations […] continue in effect,” and that “it is not for the Secretary-General to proceed as if no such uncertainty exists”.

(Source: Safehaven, 20 Sep 2020) [Excerpts]
TikTok is now planning to go public without the sale of its parent company, ByteDance, in a deal that would involve American software behemoth Oracle as the responsible partner for US data and Walmart is some vague capacity. The deal hasn’t been approved by either Washington or Beijing yet, and both TikTok and WeChat will be banned from U.S. app stores as of Sunday.  
The deal is being reviewed by the Trump administration and appears to be a compromise agreement that avoids selling ByteDance to an American company as Trump had previously demanded.  
But there is another interesting twist to the ongoing debacle that plays into U.S. elections and helps Trump considerably: He’s given TikTok and extension on operations until November 12th.


(Source: BakerMcKenzie, 18 Sep 2020)
* Principal Author: Jon Cowley, Esq., 852-2846-1744, BakerMcKenzie
China governs the import and export of technology under the Regulations for the Administration of the Import and Export of Technology (“Technology Regulations”), the Measures for the Administration of Technologies Prohibited or Restricted from Import, and the Measures for the Administration of Technologies Prohibited or Restricted from Export.  The Technology Regulations and related measures are separate and distinct from other China regulatory regimes that currently govern the import and export of dual-use items and encryption technologies.   
On 28 August 2020, China’s Ministry of Commerce (MOFCOM) and Ministry of Science and Technology (MOST) jointly issued Announcement [2020] No. 38 (“Announcement”) to amend the Catalogue of Technologies Prohibited or Restricted from Export (“Catalogue”). The Catalogue was last updated in 2008. The amendments to the Catalogue came into effect on 28 August 2020.
The Announcement amends the Catalogue through adding 23 categories of technologies to the list of technologies restricted from export, modifying the control parameters of 21 categories of technologies already included on such list, and removing 4 and 5 categories of technologies from the lists of technologies prohibited and restricted from export, respectively.
Of particular note is the modification of the control parameters for “information processing technologies.” Export of the following technologies are, as a result, now restricted: artificial intelligence interactive interface technologies, personalized information recommendation service technologies based on data analysis, speech synthesis and evaluation technologies, and scanning and photo recognition technologies. Newly added categories of technologies, the export of which is restricted as a result of the amendments, include cryptographic security technologies, information countermeasure and defense technologies, breeding technologies, laser technologies, and space and aerospace-related technologies, amongst others. Categories of technologies which have been removed from the Catalogue pursuant to the amendments include certain types of chemical and drug production and processing technologies, as well as firewall software technologies.
Where a technology is listed as subject to export restrictions, a Letter of Intent on Technology Export Licensing must first be obtained from relevant authorities before an entity or individual can conduct “substantive negotiations,” or enter into legally binding commitments, with respect to export of the technology. Export of technology generally refers to the transfer of technology from China’s territory to overseas, whether through trade, investment, or economic and technological cooperation. A technology export contract must be signed within the validity period of the Letter of Intent, once granted, and before the technology is actually exported, i.e. by way of technology transfer, a Technology Export License will need to be obtained. Under China’s regulations, in determining whether to grant a Letter of Intent, the authorities will engage in a trade and technical examination of the proposed technology export, involving a review as to whether the proposed export is in conformity with, e.g., China’s foreign trade, industrial export, and technological development policies.

(Source: Sidley, 18 Sep 2020)
* Principal Author: James Mendenhall, Esq., 1-202-736-8141, Sidley
On September 15, 2020, the U.S. Department of the Treasury published a final rule modifying the types of foreign investments that would trigger a mandatory filing before the Committee on Foreign Investment in the United States (CFIUS). The final rule largely tracks a proposed rule published by CFIUS on May 21, 2020. The final rule will come into effect on October 15, 2020, and will apply only to transactions that take place on or after that date. It is not retroactive.
The Final Rule Ties the Filing Requirements for Investments in U.S. Critical Technology Businesses to Export License Requirements
CFIUS has jurisdiction to review foreign investments in U.S. businesses and mitigate any potential national security concerns. While CFIUS notifications are usually voluntary, certain covered transactions involving U.S. businesses that produce, design, test, manufacture, fabricate, or develop one or more critical technologies (“U.S. critical technology businesses”) are subject to a mandatory filing requirement.  

(Source: Steptoe, 18 Sep 2020) [Excerpts] 
* Principal Author: Brittany Prelogar, Esq., 1-202-429-5518, Steptoe
The US Department of Homeland Security’s Customs and Border Protection agency (CBP) announced on September 14 the issuance of five new withhold release orders (WROs) on entities allegedly using forced labor in or from China’s western Xinjiang Uyghur Autonomous Region (XUAR). The WROs bar the import into the United States of various goods alleged to be produced by forced, indentured, and convict labor (“Forced Labor”), including cotton, apparel, hair, and technology products.
CBP’s announcement is just the latest in a wider US government interagency effort to crack down on alleged human rights abuses related to ethnic minorities in XUAR. Companies are encouraged to take a fresh look at how their existing compliance programs address the risks of Forced Labor and related labor and human rights issues in their supply chains, as well as related economic sanctions and export controls risks.


MS_a112. Monday List of Ex/Im Job Openings: 57 Jobs Available –  11 New Job Openings This Week 

New Jobs
* Amazon, Seattle, WA; Export Compliance Manager
* Bombardier; Philadelphia, PA; Global Head of Export Control (m/w/d)
* C4 Advanced Tactical Systems: Orlando, FL; Sr. Trade Compliance Specialist; Contact Details:edward.pevzner@c4ats.com
* GKN Aerospace; Garden Grove, CA; Export Control Officer
* Hexagon Autonomy & Positioning division; Morton, IL; Trade Compliance Specialist; Job ID: 2019-1661; Contact Details: hr.nov.ap@hexagon.com
* Honeywell; El Paso, TX; Sr. Import/Export Assistant; Job ID: Req245068
* Ingram Micro; Irvine, CA; Associate Professional, Import/Export-USA; Job ID: 37646
* Schaeffler Group USA; Fort Mill, SC; Export Control Specialist
* Schneider Electric; Boston, MA; Senior Manager of Export Controls; Job ID: 006892
* Steris; Mentor, OH; Import and Export Compliance Analyst; Job ID: 20692

Click here for the full list 

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(Source: ECS)
*What:  ITAR/EAR Controls for Non-U.S. Companies
*When:  15-16 Oct
*Where:  Your Computer
*Sponsor: Export Compliance Solutions & Consulting (ECS)
*ECS Speakers:  Suzanne Palmer, Mal Zerden
*Register: here or write to liz@exportcompliancesolutions.com or call 1-866-238-4018
* * * * * * * * * * * * * * * * * * * *

The ABC of Foreign Military Sales (FMS)
Tuesday, 29 September 2020

More Info

Designing and Implementing
   an ICP
Tuesday, 6 October 2020 More Info
Wednesday, 7 October
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EN_a115. Bartlett’s Unfamiliar Quotations

(Source: Editor)


* H.G. Wells (Herbert George Wells; 21 Sep 1866 – 13 Aug 1946; was an English writer. Prolific in many genres, he wrote dozens of novels, short stories, and works of social commentary, history, satire, biography and autobiography. Wells is now best remembered for his science fiction novels. His most notable science fiction works include The Time MachineThe Island of Doctor MoreauThe Invisible Man, and The War of the Worlds.  Wells was nominated for the Nobel Prize in Literature four times.)
  – “No passion in the world is equal to the passion to alter someone else’s draft.”
  – “Leaders should lead as far as they can and then vanish. Their ashes should not choke the fire they have lit.”
  – “The uglier a man’s legs are, the better he plays golf – it’s almost a law.’
Monday is pun day.
* What did one toilet say to the other? “Are you okay? You look a bit flushed.”  
* What do you think of that new restaurant on the moon?  “The food was good, but there really wasn’t much atmosphere.”  
* What musical instrument is found in the bathroom? A tuba toothpaste.
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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 


5 Apr 2019: 84 FR 13499:

Civil Monetary Penalty Adjustments for Inflation. 
27 Aug 2020: 85 FR 52898Additions of Entities to the Entity List and Revisions of 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.


29 Jul 2020: 85 FR 45513 Extension to Certain Temporary Suspensions, Modifications, and Exceptions due to Corona Virus.  The latest edition of the BITAR is 29 July 2020.  

DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
Inflation Adjustment of Civil Monetary Penalties Related to Reporting and Recordkeeping.

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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