20-1228 Monday “Daily Bugle”

20-1228 Monday “Daily Bugle”

(The DB was not published on Friday 25th Dec, Christmas Day)
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Monday, 28 December 2020

  1. Commerce/BIS: “EAR is Amended to Change Country Groups for Ukraine, Mexico, and Cyprus”
  2. Treasury/OFAC: “Blocking or Unblocking of Persons and Properties”
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings)
  3. State/DDTC: (No new postings)
  4. Singapore Customs: “Tradenet Extended Downtime”
  1. Bloomberg: “America Can’t Compete with Chinese Tech by Walling Itself Off”
  2. EUS: “Post Brexit UK / EU Xmas Eve Agreement Does Not Cover Sanctions”
  1. Holland & Hart: “Commerce Names More than 100 Chinese and Russian to Inaugural MEU List”
  2. Thompson Hine: “OFAC Once Again Issues License Delaying PdVSA 2020 8.5% Bond-Related Authorizations”
  1. Monday List of Ex/Im Job Openings: 67 Jobs Available – 7 New Job Openings This Week
  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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85 FR 84211: Rule
* AGENCY: Bureau of Industry and Security, Commerce.
* ACTION: Final rule.
* SUMMARY: In this rule, the Bureau of Industry and Security (BIS) amends the Export Administration Regulations (EAR) to revise the Country Group designations for Ukraine, Mexico and Cyprus. Specifically, in this rule, BIS moves Ukraine from Country Group D to Country Group B and adds Mexico and Cyprus in Country Group A:6. This rule also includes conforming changes.
* DATES: Effective December 28, 2020.
* FOR FURTHER INFORMATION CONTACT: Patricia Muldonian, Office of National Security and Technology TransferControls, Patricia.Muldonian@bis.doc.gov.

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(Source: Federal Register) [Excerpts]
85 FR 84468: Notice
* AGENCY: Office of Foreign Assets Control, Treasury.
* ACTION: Notice.
* SUMMARY: The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is publishing the names of one or more individuals that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List). OFAC has determined that one or more applicable legal criteria were satisfied to place the individuals on the SDN List. All property and interests in property subject to U.S. jurisdiction of these individuals are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.
* DATES: See Supplementary Information section for applicable 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; or Assistant Director for Regulatory Affairs, tel.: 202-622-4855.

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* Treasury/OFAC; Notices; Blocking or Unblocking of Persons and Properties; [Pub. Date: 29 Dec 2020] (PDF) (PDF)
* USTR; Notices; Product Exclusion Extensions and Additional Modifications:China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation; [Pub. Date: 29 Dec 2020] (PDF)

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OGS_a24. Commerce/BIS: (No new postings)

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OGS_a35. State/DDTC: (No new postings)

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In addition to the usual housekeeping time for TradeNet on Sundays from 4am to 8am, we wish to inform you that Singapore Customs will be performing system maintenance work which will affect TradeNet for the following date(s) and time.
* Date: 10 Jan 2021
* Time: 4am to 12pm
* Duration: 8 hours 2
You are advised not to submit any applications through TradeNet during the above mentioned period. Please submit your applications through TradeNet after the indicated timing above. 3 Please bring the contents of this Notice to the attention of your staff. Kindly plan in advance and submit applications before the downtime, to minimise disruptions to your business operations. We apologise for any inconvenience caused.

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(Source: Bloomberg, 28 Dec 2020) [Excerpts]
The election of Joe Biden will not end the U.S.-China trade war. Biden has already vowed to keep outgoing President Donald Trump’s tariffs as leverage for negotiations. That signals the dawn of a permanent new era of economic competition between the two superpowers. But beyond the flashy, headline-grabbing issue of tariffs and trade deals, there’s another, more important economic struggle being waged — the battle to control technology industries. And the U.S. is deploying some very risky weapons to win it.
As China approaches technological parity with the U.S. in a variety of high-value industries, the U.S. has acted to maintain supremacy. Under Trump, the Committee on Foreign Investment in the U.S. (CFIUS) dramatically stepped up its blockage of Chinese acquisitions of U.S. companies — a major way that China appropriates advanced technology. Though natural security is the official justification for this, retaining U.S. commercial dominance is undoubtedly an additional goal.

(Source: EU Sanctions Law Practice and Guidance, 28 Dec 2020) [Excerpts]
The Trade & Cooperation Agreement between the EU and UK (text here) does not cover sanctions or other aspects of foreign policy.  The political declaration outlining ambitions for the post-Brexit future relationship agreed by the EU and UK alongside the withdrawal agreement in October 2019 had included proposed terms for a future relationship on foreign policy including sanctions (see previous blog) but since May 2020 negotiations have not included foreign policy.
The UK Foreign Secretary’s letter to the EU Security and Justice Sub-Committee of the House of Lords in November said “the UK’s future relationship with the EU “will be based on friendly cooperation between sovereign equals” but the UK did not “see the need for a Treaty to govern our cooperation”. The European Commission press release on 24 December states that “As of 1 January 2021, there will therefore be no framework in place between the UK and the EU to develop and coordinate joint responses to foreign policy challenges, for instance the imposition of sanctions on third country nationals or economies.”


(Source: Holland & Hart, 24 Dec 2020)
* Principal Author: Steven Pelak, Esq., 1-202-654-6929, Holland & Hart
This week, the U.S. Department of Commerce formally named 103 Chinese and Russian companies to its new Military End User (“MEU”) List.  A long time in the publication and release process, the MEU List identifies entities that the U.S. Government has determined represent “an unacceptable risk of use in or diversion to a ‘military end use’ or ‘military end user’ in China, Russia, or Venezuela.”  With the U.S. Government’s action this week, a license will be required to export, reexport, or transfer (in-country) designated items to entities on the MEU List.
First generally proposed more than 15 years ago by then U.S. Representative Henry Hyde, among others, the MEU List provides the first steps toward greater public guidance and notice to the manufacturers and sellers of dual-use items and technologies of military end users known to the U.S. Government.  “This action establishes a new process to designate military end users on the MEU List to assist exporters in screening their customers for military end users,” said Commerce Secretary Wilbur Ross.
The initial MEU List includes 58 Chinese and 45 Russian companies.  However, additional parties are expected to be added by the U.S. Government’s End-User Review Committee, an interagency body composed of the Departments of Commerce, Defense, Energy, State, and, where appropriate, the Treasury.
The action comes as tensions between the U.S. Government and China have escalated sharply this year.  In April, the Bureau of Industry and Security (“BIS”) amended the EAR to tighten licensing requirements and due diligence expectations for exporting, reexporting, and transferring (in-country) items intended for military end users or military end uses in China, Russia, and Venezuela.  Last month, President Trump signed an Executive Order effectively barring U.S. persons from investing in Chinese companies that support China’s military.  Last week, the Trump Administration added Chinese semiconductor company Semiconductor Manufacturing International Corporation (“SMIC”) and dozens of Chinese companies to the BIS’s Entity List.  In light of current bi-partisan support in Congress for such actions generally, one may reasonably anticipate that the incoming Administration of President-elect Biden (a) will build upon and expand these export controls aimed particularly at the supply chains for the Chinese and Russian militaries and intelligence agencies and (b) will seek broader multilateral support for such controls among allies of the United States.
The MEU List was formally published yesterday, December 23, 2020, in the Federal Register.

(Source: Thompson Hine, 24 Dec 2020)
* Author: Scott E. Diamond, 1-202-263-4197, Thompson Hine
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced that it has issued General License (GL) 5F (Authorizing Certain Transactions Related to the Petróleos de Venezuela, S.A. 2020 8.5 Percent Bond on or After July 21, 2021), which continues to delay U.S. persons’ ability to enforce bondholder rights to the CITGO shares serving as collateral for the Petróleos de Venezuela, S.A. (PdVSA) 2020 8.5% bond until on or after July 21, 2021 – the previous deadline had been January 19, 2021. Effective December 23, 2020, this GL 5F replaces GL 5E.  Additionally, OFAC modified frequently asked question #595 to address the scope of GL 5F.
With this new General License, U.S. persons remain prohibited until July 21, 2021 from engaging in any transactions related to the sale or transfer of CITGO shares in connection with the PdVSA 2020 8.5% Bond, unless specifically authorized by OFAC. In the modified FAQ 595, OFAC notes a favorable licensing policy toward those seeking to apply for a specific license in an effort to reach an agreement on proposals to “restructure or refinance payments due to the holders of the PdVSA 2020 8.5 percent bond.”  See  Update of October 6, 2020 for additional background on this issue.


MS_a111. Monday List of Ex/Im Job Openings: 67 Jobs Available – 7 New Job Openings This Week

(Source: Events & Jobs Editor)
New Jobs
* Boehringer Ingelheim; Fremont, CA; Supervisor, Warehouse 
* Dupont; Wilmington, DE; Export Control Compliance Specialist 
* KPMG; San Francisco, CA; Senior Associate, Export Compliance; Job ID: 51600
* Kratos; Roseville, CA; Sr. Trade Compliance Analyst 
* TE Connectivity; Plymouth, MN; Sanctions Specialist (Remote) 
* Werner; Itasca, IL; Trade Compliance Manager  

Click here for the full list

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EN_a112. Bartlett’s Unfamiliar Quotations

(Source: Editor)

* Robert J. Hanlon (28 Dec 1932 – 30 May 1998; American author of credited with various jokes related to “Murphy’s Law” published in Arthur Bloch’s Murphy’s Law Book Two: More Reasons Why Things Go Wrong!).
  – “Never attribute to malice that which is adequately explained by stupidity.” 
* Mortimer Adler (Mortimer Jerome Adler; 28 Dec 1902 – 28 Jun 2001; was an American philosopher, educator, and popular author. He taught at Columbia University and the University of Chicago, served as chairman of the Encyclopedia Britannica Board of Editors, and founded his own Institute for Philosophical Research. Adler and Robert Hutchins founded the Great Books of the Western World program and the Great Books Foundation.)
  – “You have to allow a certain amount of time in which you are doing nothing in order to have things occur to you, to let your mind think.”  
  – “In English we must use adjectives to distinguish the different kinds of love for which the ancients had distinct names.”  
Monday is pun day.  
* Obi-Wan said to Luke Skywalker, “I knew what you would get for Christmas.” Luke replied, “How did you know that?” Obi-Wan said, “I felt your presents.” 
* Why didn’t the skeleton go to the Christmas party? He had no body to go with.
* How much did Santa pay for his sleigh?  Nothing. It was on the house!
* What do you get when you cross a snowman and a vampire?  Frostbite.
* Why didn’t crabs give any holiday gifts?  Because they were shell-fish.


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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. 
28 Dec 2020: 85 FR 84211;   Revisions to Country Groups for Ukraine, Mexico, and Cyprus

24 Apr 2018: 

83 FR 17749: Foreign Trade Regulations (FTR): Kimberley Process Certificates. The latest edition of Bartlett’s Annotated FTR “BAFTR” is 15 Dec 2020. 

: 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.


11 Dec 2020: 85 FR 79836: Extension of temporary suspensions, modifications and exceptions. The latest edition of Bartlett’s Annotated ITAR (BITAR) is 11 Dec 2020.  

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