20-0928 Monday “Daily Bugle”

20-0928 Monday “Daily Bugle”

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Monday, 28 September 2020

  1. Treasury/OFAC: “Blocking or Unblocking of Persons and Properties”
  2. State/DDTC: “ITAR–Temporary Update to Republic of Cyprus Country Policy”
  3. State/DDTC: “Cuba Prohibited Accommodations List”
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: “Statement on U.S. District Court Ruling on TikTok Preliminary Injunction”
  3. State/DDTC: (No new postings)
  4. EU External Action: “Group of Governmental Experts on Lethal Autonomous Weapons Systems Convention on Certain Conventional Weapons”
  1. The National Interest: “Stealth F-35s to UAE: Could Congress Actually Block It?”
  2. WSJ: “U.S. Sets Export Controls on China’s Top Chip Maker”
  1. Kelley Drye: “OFAC Imposes Further Travel-Related Restrictions on Cuba”
  2. Winston: “Recent OFAC Settlement Highlights the Need for Post-Acquisition Sanctions Compliance Controls”
  1. Monday List of Ex/Im Job Openings: 63 Available – 6 New Job Openings This Week
  1. ECTI Presents: 29 Sep; “A New World of Export Controls for China”
  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 60874: 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.
* DATES:See SUPPLEMENTARY INFORMATION section for effective date(s).
* FOR FURTHER INFORMATION CONTACT:OFAC: Associate Director for Global Targeting, tel.: 202-622-2420; Assistant Director for Sanctions Compliance & Evaluation, tel.: 202-622-2490; Assistant Director for Licensing, tel.: 202-622-2480.
The Specially Designated Nationals and Blocked Persons List and additional information concerning OFAC sanctions programs are available on OFAC’s website (https://www.treasury.gov/ofac).

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(Source: Federal Register) [Excerpts]
85 FR 60698: Rule
* AGENCY: Department of State.
* ACTION: Temporary final rule.
* SUMMARY: The Department of State is amending the International Traffic in Arms Regulations (ITAR) to update defense trade policy toward the Republic of Cyprus (Cyprus) by temporarily removing prohibitions on exports, reexports, retransfers, and temporary imports of non-lethal defense articles and defense services destined for or originating in Cyprus. On June 2, 2020, the Secretary of State, exercising authority under section 1250A(d) of the National Defense Authorization Act for Fiscal Year 2020 and section 205(d) of the Eastern Mediterranean Security and Energy Act as delegated from the President, determined that it was essential to the national security interest of the United States to waive the limitations on non-lethal defense articles and defense services destined for or originating in Cyprus. The waiver is effective for one fiscal year. This amendment reflects that waiver.
* DATES:This temporary rule is effective on October 1, 2020, and expires on September 30, 2021, unless subsequently extended.
* FOR FURTHER INFORMATION CONTACT: Sarah Heidema, Office of Defense Trade Controls Policy, Department of State, telephone (202) 663-2809, oremail deccspmddtc@midatl.service-now.com. ATTN: Regulatory Change, ITAR Section 126.1 Cyprus Country Policy Update.

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(Source: Federal Register) [Excerpts]
85 FR 60855: Notice
* AGENCY: Department of State.
* ACTION: Initial publication of list of properties; notice.
* SUMMARY: The Department of State is publishing the Cuba Prohibited Accommodations List identifying properties subject to additional prohibitions with respect to certain lodging-related transactions under the Cuban Assets Control Regulations (CACR).
* DATES: Effective on September 28, 2020.
* FOR FURTHER INFORMATION CONTACT: Emily Belson, Office of Economic Sanctions Policy and Implementation, 202-647-6526; Robert Haas, Office of the Coordinator for Cuban Affairs, 202-453-8456, Department of State, Washington, DC 20520.

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* State/DDTC; NOTICES; List of Entities and Sub-entities: Cuba (Cuba Restricted List); [Pub. Date: 29 Sep 2020] 

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(Source: Commerce/BIS, 27 Sep 2020)
On September 27, 2020, the United States District Court for the District of Columbia granted a nationwide preliminary injunction against the implementation of Executive Order (E.O.) 13942, limited to the Secretary of Commerce’s Identification of Prohibited Transactions with TikTok/ByteDance involving ‘any provision of services… to distribute or maintain the TikTok mobile application, constituent code, or application updates through an online mobile application store.’  The E.O. is fully consistent with the law and promotes legitimate national security interests.  The Government will comply with the injunction and has taken immediate steps to do so, but intends to vigorously defend the E.O. and the Secretary’s implementation efforts from legal challenges.

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(Source: European Union External Action, 28 Sep 2020) [Excerpts]
… We encourage the High Contracting Parties (HCP) to seek further common ground on developing substantive content and ensuring the effectiveness of the process. The Convention on Certain Conventional Weapons (CCW) is the relevant international forum in this regard, combining diplomatic, legal and military expertise and involving, in addition to States, international and regional organisations, the International Committee of the Red Cross (ICRC), industry and civil society. The CCW must remain responsive to new developments in the field of weapons technology and be able to adequately address them. In this regard, the CCW should ensure, within its mandate, that, first of all, these new developments comply with relevant obligations. For the credibility of the process and acknowledging the progress already made, it is important that the CCW produces concrete and substantive results, including by advancing on the operationalisation of the 11 guiding principles.
Further consideration of the human element in the use of lethal force; aspects of human-machine interaction in the development, deployment and use of emerging technologies in the area of lethal autonomous weapons systems
We recall the mandate agreed in 2016 by the Fifth CCW Review Conference for the GGE LAWS and the comprehensive list of items identified for further consideration. For the EU, the consideration of the human element and reaching common understandings on elements of human control will be relevant for all future work.
We should continue work to understand how human-machine interaction, human control, judgment, accountability and responsibility might work, with regard to possible military applications of emerging technologies in the area of LAWS. We have previously outlined key elements which, in our view, are crucial for ensuring sufficient human supervision. We should aim to elaborate a common understanding on the type and degree of human-machine interaction, including elements of sufficient human control and judgment, which will be needed to ensure full compliance with International Law and, in particular, IHL. The clarification, consideration and development of aspects of the normative and operational framework on emerging technologies in the area of LAWS is based on the implementation of the existing IHL rules and must ensure that these rules fully apply to these systems, without prejudice to future developments or additions to these rules. This might facilitate our consideration of the normative and operational framework related to emerging technologies in the area of LAWS.
On the proposed agenda
The proposed agenda of the GGE LAWS is a pragmatic basis for our work on legal, technical and military aspects. Acting upon this agenda will not prevent any State from raising other relevant issues during the debate. We would like to reiterate our proposal that information should be freely and regularly exchanged across thematic areas, as all areas have cross-cutting considerations. We would also propose that the key themes with possible deliverables for each thematic area are identified in advance and agreed by consensus.
On the guiding principles
The EU attaches great importance to the 11 guiding principles, including, inter alia, the additional guiding principle (c) proposed by Belgium and Ireland on human-machine interaction. This may take various forms and be implemented at various stages of the life cycle of a weapon, and should ensure that the potential use of weapons systems based on emerging technologies in the area of LAWS is in compliance with applicable international law, in particular IHL. Their purpose is to act as a basis for the GGE’s recommendations in relation to the clarification, consideration and development of aspects of the normative and operational framework on emerging technologies in the area of LAWS. We encourage HCP to take them into account in their national practices and policies.

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(Source: The National Interest, 27 Sep 2020) [Excerpts]
The top Senator Foreign Relations Committee leaders invoked Israel’s need to have a qualitative military edge (QEM), which could make the possible sale of the Lockheed Martin F-35 Lightning II Joint Strike Fighter to the United Arabs Emirates (UAE) anything but a “done deal.” In a show of bipartisanship, both Chairman Jim Risch (R-Idaho) and ranking member Bob Menendez (D-N.J.) highlighted their concerns to State Department officials over the deal.
“With all due respect, it doesn’t take a rocket scientist to figure out that if Israel’s the only country in the Middle East that has F-35s, that selling it to someone else no longer produces that qualitative military edge in the air,” said Menendez, as reported by Defense News.
The proposed sale of the fifth-generation fighter jets to the UAE could present a long-term negative strategic impact for the State of Israel, warned the nation’s Air Force Chief Amikam Norkin.

(Source: WSJ, 28 Sep 2020)
The Commerce Department has told U.S. computer-chip companies that they must obtain licenses before exporting certain technology to China’s largest manufacturer of semiconductors, a blow to China’s efforts to compete in advanced technology.
The department laid out the requirement in a letter to the computer-chip industry Friday. The letter, a copy of which was reviewed by The Wall Street Journal, says exports to Semiconductor Manufacturing International Corpor its subsidiaries risk being used for Chinese military activities.
The U.S. action threatens to cut off SMIC from equipment used to manufacture chips. American companies are major suppliers of such equipment.
The Trump administration has for weeks been deliberating over whether to impose export restrictions on SMIC. Earlier this month, the Defense Department disclosed that U.S. agencies were in discussions over whether to add SMIC to the Commerce Department’s entity list, a move that would also require certain SMIC suppliers to apply for licenses.


(Source: Kelley Drye, 25 Sep 2020)
* Principal Author: Robert Slack, Esq., 1-202-342-8622, Kelley Drye
Yesterday, the Office of Foreign Assets Control (OFAC) amended the Cuban Assets Control Regulations (CACR) to further limit the ability of U.S. persons to book lodging in Cuba, import certain goods from Cuba, and participate in professional meetings or artistic and athletic events in Cuba.  The changes include the following:
The new rules prohibit U.S. persons from staying at, paying for, or arranging for lodging at hotels and other properties that have been identified by the State Department as being owned or controlled by the Cuban government.  The State Department is expected to publish a list of properties subject to the restrictions, called the Cuba Prohibited Accommodations List (CPA List), on its website.
  • The amendment prohibits U.S. person travelers from bringing Cuban origin tobacco or alcohol products back to the United States.
  • The amendment removes the general license at CACR § 515.564(a)(2) that previously authorized U.S. persons to attend and organize certain professional meetings or conferences in Cuba.  Under the new rules, U.S. persons wishing to attend or organize meetings in Cuba will likely need to obtain a specific license from OFAC, which will be issued on a case-by-case basis.
  • Finally, OFAC narrowed the scope of the general license at CACR §515.567 to only authorize certain amateur and semi-professional international sporting events in Cuba.  Participation in, or organization of, other public performances, athletic competitions, and exhibitions in Cuba will now require a specific license from OFAC, which will be issued on a case-by-case basis.
The travel, hospitality, and sports industries should review their potential exposure to these rule changes and update their internal compliance programs accordingly.

(Source: Winston & Strawn, 25 Sep 2020)
* Principal Author: Cari N. Stinebower, Esq., 1 202-282-5788, Winston & Strawn
On September 24, 2020, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that California-based Keysight Technologies Inc. (Keysight) has agreed on behalf of its former Finnish subsidiary, Anite Finland Oy (Anite) to pay $473,157 to settle potential civil liability for Anite’s reexport of U.S. export-controlled test measurement equipment to Iran. As part of the settlement, Keysight also agreed to establish and maintain several sanctions compliance measures that are designed to minimize the risk of recurrence of similar conduct in the future. Anite was a subsidiary of Keysight when the apparent violations occurred in 2016, however, Anite has since been merged into Keysight and no longer exists as a distinct entity. This case is the latest enforcement action highlighting the need for both pre-merger and post-merger sanctions compliance due diligence as well as strong post-merger integration and compliance efforts.
According to the settlement agreement, in 2016 Anite appears to have violated § 560.205 of the Iranian Transactions and Sanctions Regulations (ITSR) when it completed six orders of goods, collectively valued at $331,089, with knowledge that the goods were destined for end-users in Iran. Although there was a general license in effect at the time of the violations which authorized foreign entities owned or controlled by U.S. persons to engage in certain transactions with Iran, the general license did not authorize reexportation from a third country of any goods, technology, or services prohibited by § 560.205 of the ITSR.
Keysight acquired Anite’s U.K.-based parent in August 2015. During Keysight’s pre-acquisition due diligence, Keysight determined that Anite had previously conducted business with certain sanctioned countries, including Iran. Prior to its acquisition by Keysight, Anite committed to cease all existing and future business activity with such countries. Despite this commitment and a post-acquisition directive from Keysight that Anite cease all sales to Iran, certain Anite employees agreed that, to preserve their credibility in the Middle East, they would proceed with their business in Iran and the other sanctioned countries. Following this agreement, the employees took measures to keep Keysight from discovering their continued dealings with Iran, including omitting in correspondence references to “Iran” or locations in Iran. 
Upon discovering the Anite employees’ misconduct, Keysight conducted an extensive internal investigation to determine the extent of the apparent violations, terminated the employees involved, and then voluntarily self-disclosed the apparent violations to OFAC and in its SEC filings. This self-disclosure significantly decreased Keysight’s monetary liability in this case. OFAC has a set of Sanctions Enforcement Guidelines which they use to determine how they will enforce the violation of U.S. sanctions. Under those guidelines, self-disclosure of an apparent violation can reduce the base civil penalty amount by half of the applicable statutory maximum. Beyond the self-disclosure, OFAC took the following aggravating and mitigating factors into account when negotiating the settlement amount.
  • Anite willfully violated the ITSR when it shipped six orders of products that incorporated 10 percent or more U.S.-export controlled content exported from the United States, as part of a scheme specifically to circumvent Keysight’s directive to cease Iran related business;
  • Senior Anite branch and sales managers knew of and actively participated in the violations; and
  • The value of Anite’s reexports to Iran combined with its attempts at concealment and obfuscation significantly harmed the program objectives of the ITSR.
  • Neither Keysight nor Anite had received a penalty notice or Finding of Violation from OFAC in the five years preceding the transactions giving rise to the apparent violations;
  • Keysight fully cooperated with OFAC’s investigation, including by producing records and information to OFAC in a clear and organized fashion, responding in a timely and efficient manner to all follow-up requests for information, and entering into a statute of limitations tolling agreement;
  • Keysight undertook several remedial measures by conducting a thorough internal investigation to identify the causes of the apparent violations; and
  • Keysight has enhanced its sanctions compliance program to minimize the risk of recurrence of similar conduct in the future.
This case highlights the importance of not only conducting due diligence on target companies but continued monitoring of the target after the transaction is completed. Newly acquired subsidiaries should be integrated into an organization’s sanctions compliance program and the newly acquired companies should adopt and maintain the compliance controls necessary to mitigate the risk of sanctions violations. This is the third such enforcement action since January 2019 focusing on pre- and post-merger due diligence – and on post-merger integration. The other enforcement actions were Stanley Black and Decker (March 2019) and KollMorgen (February 2019).


MS_a112. Monday List of Ex/Im Job Openings: 63 Jobs Available –  6 New Job Openings This Week 

New Jobs
* Bell Textron Inc.; Fort Worth, TX; Trade Compliance Analyst; Job ID: 285618; Contact Details: amathis@bellflight.com
* Bell Textron Inc.; Fort Worth, TX;Trade Classification Specialist; Job ID: 284849; Contact Details: mroy@bellflight.com
* Micron Technology Inc.; Boise, ID; Compliance Operations Supervisor; Job ID: 220124; Contact Details: justinsmith@micron.com
* Microsoft; Reston, VA; Sr Manager, Export Controls – ITAR; Job ID: 843021
* Solo Point Solution; Newark, CA; Trade Compliance Specialist
* Thermo Fisher; Hillsboro, OR; Senior Trade Analyst; Job ID: 128510BR

Click here for the full list.  

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(Source: Ashleigh Foor, ashleigh@learnexportcompliance.com)
* What: A New World of Export Controls for China
* When: 29 Sep; 1:00 p.m. (EDT)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Scott Gearity
* Register: bit.ly/ECTIChinaExports / or Ashleigh Foor, 1-540-433-3977, ashleigh@learnexportcompliance.com.
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The ABC of Foreign Military Sales (FMS)
Tomorrow, 29 Sep 2020
Time: 3-5 pm Amsterdam
        9-11 am Eastern US
        6-8 am Pacific US

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)


* Sai Baba (Sai Baba of Shirdi (28 Sep 1838 — 15 Oct 1918; was an Indian spiritual master who is regarded by his devotees to be a manifestation of Sri Dattaguru and identified as saint and a fakir. He is revered by both his Hindu and Muslim devotees during, as well as after his lifetime.
 – “What is new in the world? Nothing. What is old in the world? Nothing. Everything has always been and will always be.”
Monday is pun day.
How do you get a squirrel to like you? Act like a nut!
What do you call two birds in love?  Tweethearts.  
How does a scientist freshen her breath? With experi-mints.  
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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.


28 Sep 2020: 85 FR 60874: Temporary Amendment for Republic of Cyprus. The latest edition of the BITAR is 29 Sep 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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