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16-1221 Wednesday “The Daily Bugle”

16-1221 Wednesday “Daily Bugle”

Wednesday, 21 December 2016

TOP
The Daily Bugle is a free daily newsletter from Full Circle Compliance, containing changes to export/import regulations (ATF, Customs, NISPOM, EAR, FACR/OFAC, FTR/AES, HTSUS, and ITAR), plus news and events.  Subscribe 
here for free subscription.  Contact us
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[No items of interest noted today.] 

  1. Ex/Im Items Scheduled for Publication in Future Federal Register Editions 
  2. Commerce/BIS: (No new postings.) 
  3. DHS/CBP Posts New ACE Reports Data Dictionary 
  4. DoD/DSCA Posts Additional SAMM and Policy Memoranda, Week 18-24 Dec 
  5. State/DDTC: (No new postings.) 
  6. Treasury/OFAC Posts Updated North Korea-related General License 1-A 
  7. EU Posts Export Control Forum 2016 Report 
  1. M. Miller Proctor: “U.S. Antiboycott Compliance: New Federal List Published” 
  2. R.C. Burns: “Merry Snapback! Bah! Humbug!!” 
  1. University of Liverpool Talks International Trade Compliance in London, 24 Jan 
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Changes: ATF (15 Jan 2016), Customs (20 Dec 2016), DOD/NISPOM (18 May 2016), EAR (16 Dec 2016), FACR/OFAC (4 Nov 2016), FTR (15 May 2015), HTSUS (16 Dec 2016), ITAR (5 Dec 2016) 

EXIMEX/IM ITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a1

[No items of interest noted today.]

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OGSOTHER GOVERNMENT SOURCES

OGS_a11. Ex/Im Items Scheduled for Publication in Future Federal Register Editions
(Source: Federal Register)


[No items of interest noted today.] 
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OGS_a63. DHS/CBP Posts New ACE Reports Data Dictionary

(Source: CSMS # 16-001043)
 
The ACE Reports team has created its first version of the revamped ACE Reports Data Dictionary to provide trade users with a comprehensive inventory of data universes and data objects available in ACE Reports. This reference guide is designed to enhance the understanding of ACE Reports by clearly identifying and defining all data universes and data objects available to trade users that have been deployed in ACE Reports since 2015. All data objects are defined in a simple two column table that includes the object name and object definition. The document is organized alphabetically by subject area (e.g., AD/CVD or Cargo Release) and data objects are then sorted in ascending alphabetical order within each subject area.
 
Please note: The ACE Reports Data Dictionary does not provide a list of each individual public “canned” report available to users; this information is available in the ACE Reports Catalog.
 
The data dictionary is a living document that will grow and evolve over time as new capabilities are deployed in ACE Reports. Each update will be marked with the month and year of issuance to allow for quick and easy identification of the most recently published document.
 
The document is available in ACE Reports by clicking the View ACE Reports Training Resources button on the homepage and then selecting the ACE Reports Data Dictionary option.

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OGS_a45. State/DDTC: (No new postings.)
(Source: State/DDTC)
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OGS_a5
6. Treasury/OFAC Posts Updated North Korea-related General License 1-A

(Source: Treasury/OFAC)
 
The Office of Foreign Assets Control (OFAC) has amended General License 1 pursuant to E.O. 13722 of March 15, 2016, “Blocking Property of the Government of North Korea and the Workers’ Party of Korea, and Prohibiting Certain Transactions With Respect to North Korea.” General License 1-A no longer authorizes U.S. financial institutions to open and operate accounts for the diplomatic mission of North Korea and its employees and their families. It now requires that funds transfers to or from the mission or its employees be conducted through an account at a U.S. financial institution that has been specifically licensed by OFAC.

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OGS_a7
7. EU Posts Export Control Forum 2016 Report

 
The report provides an overview of the discussion during the Export Control Forum 2016 on the modernization of the EU exports controls system, and can be found here.

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COMMCOMMENTARY

COMM_a18
. M. Miller Proctor: “U.S. Antiboycott Compliance: New Federal List Published”

 
* Author: Melissa Miller Proctor, Esq., Polsinelli PC, mproctor@polsinelli.com, 602-650-2002.
 
Companies doing business in the Middle East take note: The
Treasury Department
recently published its quarterly list of countries that currently require participation or cooperation with an international boycott, such as the
Arab League
‘s boycott of
Israel
.
 
Even though many of these countries are WTO members and were required to shut down their Arab League offices as a condition of membership, many boycott-related requests are still being issued by government agencies and companies in these countries. The countries that are designated on this list, which by the way are the very same countries that were listed in the Third Quarter list, are:
 
  – Iraq
  – Kuwait
  – Lebanon
  – Libya
  – Qatar
  – Saudi Arabia
  – Syria
  – United Arab Emirates
  – Yemen
 
To view the list, click here.
 
If you are not familiar with U.S. antiboycott requirements, Part 750 of the Export Administration Regulations (EAR) prohibits U.S. companies and their foreign affiliates from complying with requests related to a foreign boycott that is not sanctioned by the U.S. Government. Specifically, U.S. companies and their overseas affiliates are prohibited from agreeing to:
 
  (1) Refuse to do business with or in Israel or with blacklisted companies
  (2) Discriminate against other persons based on race, religion, sex, national origin or nationality
  (3) Furnish information about business relationships with or in Israel or with blacklisted companies, or
  (4) Furnish information about the race, religion, sex, or national origin of another person
 
Foreign boycott-related requests can take many forms, and can be either verbal or written. They can appear in bid invitations, purchase agreements, letters of credit and can even be seen in emails, telephone conversations and in-person meetings. Some recent examples of boycott-related requests include:
 
  – “Provide a certificate of origin stating that your goods are not products of Israel.”
  – “Provide the religion and nationality of your officers and board members.” 
  – “Suppliers cannot be on the Israel boycott list published by the central Arab League.”  
  – “Provide a signed statement from the shipping company or its agent containing the name, flag and nationality of the carrying vessel and its eligibility to enter Arab ports “
 
In addition, implementing letters of credit that contain foreign boycott terms or conditions is also prohibited under the EAR.
 
Antiboycott compliance is a key issue for U.S. companies doing business in the Middle East, and personnel on the front lines with customers and supply chain partners in these countries should be trained to identify potential foreign boycott-related requests and escalate them to senior compliance personnel or in-house counsel to determine the applicable OAC and IRS reporting requirements.
 
Companies that receive boycott-related requests must submit quarterly reports to the Office of Antiboycott Compliance (OAC) unless an exemption applies. Failing to timely report a boycott request or complying with the request itself can lead to the imposition of civil penalties by the OAC. The IRS also requires U.S. taxpayers to report their operations in countries that require participation or cooperation with an international boycott on IRS Form 5713 (International Boycott Report) – the forms are submitted annually with U.S. tax returns.  Failure to comply with the Internal Revenue Code’s antiboycott requirements can lead to the revocation of certain international tax credits and benefits.

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COMM_a29
.
R.C. Burns: “Merry Snapback! Bah! Humbug!!”

(Source:
Export Law Blog
. Reprinted by permission.)
 
* Author: R. Clifton Burns, Esq., Bryan Cave LLP, Wash DC,
Clif.Burns@bryancave.com
, 202-508-6067)
 
Chestnuts roasting on an open flame …
Jack Frost nipping at your shoes.
Iran Sanctions coming back all the same,
So OFAC dressed up its FAQs.
 
Ah, yes, nothing says Christmas cheer quite like the possibility that the JCPOA will be put on Santa’s naughty list and everyone will find the old Iran sanctions back under their Christmas tree.  This is why, of course, OFAC, full of the holiday spirit, just amended its JCPOA FAQs to answer the question on everyone’s mind:  what happens when Santa brings the sanctions back?
 
Not wanting to be too much of a Grinch, on December 15, OFAC revised JCPOA FAQs M4 and M5 to reassure the exporters in Whoville that they’ll have 180 days to wind-down their dealings with Iran after snapback or US withdrawal from the JCPOA.  But if this is a Christmas gift, it’s like the “Sea Monkey Circus” that you begged for from your parents – you know, those worms in a water bag that didn’t look anything like monkeys or a circus once you actually got the gift.
 
Like the Sea Monkey Circus, what the wind-down means is not what you might think.  You have 180 days to get paid for goods already delivered to Iran.  But what if you have goods in production that were destined to Iran but not completed when the sanctions are reimposed? Do you have 180 days to finish them, deliver them and get paid?  Nope.  You’re out of luck. All you can do is pray to find someone willing to buy the goods at something above salvage value.  Or that OFAC gives you a special license to finish and deliver the goods.
 
Grandma getting run over by a reindeer seems, well, not so bad by comparison to the JCPOA getting stolen by the Grinch.

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TEEX/IM TRAINING EVENTS & CONFERENCES

TE_a110. University of Liverpool Talks International Trade Compliance in London, 24 Jan
(Source: University of Liverpool,  exed@liverpool.ac.uk)
 
Join The University of Liverpool’s Executive Education team on Tuesday 24 January 2017 at 6 pm to hear David Hayes talk about Post-Brexit Licensing.
 
Taking place at the University’s London campus at 33 Finsbury Square, this informal event will offer attendees an opportunity to hear from David Hayes, an expert in trade compliance as he talks about a topic which will have implications for years to come.
 
David Hayes has many years’ experience in export controls and sanctions, both from an industry and regulator’s perspective.  After leaving the UK Export Control Organisation in the late 90’s David worked in industry as Head of Compliance for Fortune 500 and FTSE 100 companies, with significant involvement in US export compliance under both ITAR and EAR as well as OFAC sanctions. 
After David’s talk there will be time for questions, followed by refreshments and networking.
 
The event is free, and will start at 6:00 pm.  Register at exed@liverpool.ac.uk before 16 January 2017. 

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ENEDITOR’S NOTES

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EN_a312
. Are Your Copies of Regulations Up to Date?
(Source: Editor)

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.  Changes to applicable regulations are listed below.
 
*
ATF ARMS IMPORT REGULATIONS
: 27 CFR Part 447-Importation of Arms, Ammunition, and Implements of War
  – Last Amendment: 15 Jan 2016: 81 FR 2657-2723: Machineguns, Destructive Devices and Certain Other Firearms; Background Checks for Responsible Persons of a Trust or Legal Entity With Respect To Making or Transferring a Firearm 
 
*
CUSTOMS REGULATIONS
: 19 CFR, Ch. 1, Pts. 0-199
  – Last Amendment: 20 Dec 2016: 81 FR 92978-93027: Regulatory Implementation of the Centers of Excellence and Expertise  

* DOD NATIONAL INDUSTRIAL SECURITY PROGRAM OPERATING MANUAL (NISPOM): DoD 5220.22-M
  – Last Amendment: 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 canceled Supp. 1 to the NISPOM  (Summary here.)

* EXPORT ADMINISTRATION REGULATIONS (EAR): 15 CFR Subtit. B, Ch. VII, Pts. 730-774 
  – Last Amendment: 16 Dec 2016: 81 FR 90983-90987: Implementation of the February 2016 Australia Group (AG) Intersessional Decisions and the June 2016 AG Plenary Understandings 

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
  – Last Amendment: 4 Nov 2016: 81 FR 76861-76863: Amendments to OFAC Regulations To Remove the Former Liberian Regime of Charles Taylor Sanctions Regulations and References to Fax-on-Demand Service 
 
*
FOREIGN TRADE REGULATIONS (FTR)
: 15 CFR Part 30
  – Last Amendment: 15 May 2015; 80 FR 27853-27854: Foreign Trade Regulations (FTR): Reinstatement of Exemptions Related to Temporary Exports, Carnets, and Shipments Under a Temporary Import Bond 
  – HTS codes that are not valid for AES are available
here.
  – The latest edition (9 Mar 2016) of Bartlett’s Annotated FTR (“BAFTR”), by James E. Bartlett III, is available for downloading in Word format. The BAFTR contains all FTR amendments, FTR Letters and Notices, a large Index, and footnotes containing case annotations, practice tips, and Census/AES guidance.  Subscribers receive revised copies every time the FTR is amended. The BAFTR is available by annual subscription from the Full Circle Compliance website.  BITAR subscribers are entitled to a 25% discount on subscriptions to the BAFTR.
 
*
HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES (HTS, HTSA or HTSUSA)
, 1 Jul 2016: 19 USC 1202 Annex.  (“HTS” and “HTSA” are often seen as abbreviations for the Harmonized Tariff Schedule of the United States Annotated, shortened versions of “HTSUSA”.)
  – Last Amendment: 16 Dec 2016; Harmonized System Update (HSU) 1614, containing 27,913 ABI records and 4,820 harmonized tariff records.     
  – HTS codes for AES are available
here
.
  – HTS codes that are not valid for AES are available
here.
 
INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (ITAR): 22 C.F.R. Ch. I, Subch. M, Pts. 120-130.
  – Latest Amendment: 5 Dec 2016 (effective 5 Dec 2016): 81 FR 87427-87430: Corrections & Additions to ITAR Parts 120, 121, 122, 124, 126 and 127
  – The only available fully updated copy (latest edition 9 Dec 2016) of the ITAR with all amendments is contained in Bartlett’s Annotated ITAR (“BITAR”), by James E. Bartlett III.  The BITAR contains all ITAR amendments to date, footnotes to amendments that will take on 31 December 2016, plus a large Index, over 750 footnotes containing case annotations, practice tips, DDTC guidance, and explanations of errors in the official ITAR text.  Subscribers receive updated copies of the BITAR in Word by email, usually revised within 24 hours after every ITAR amendment.  The BITAR is available by annual subscription from the Full Circle Compliance website.  BAFTR subscribers receive a 25% discount on subscriptions to the BITAR, please contact us to receive your discount code.  

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EPEDITORIAL POLICY

* The Ex/Im Daily Update is a publication of FCC Advisory B.V., edited by James E. Bartlett III and Alexander Bosch, and emailed every business day to approximately 8,000 readers of changes to defense and high-tech trade laws and regulations. We check the following sources daily: Federal Register, Congressional Record, Commerce/AES, Commerce/BIS, DHS/CBP, DOJ/ATF, DoD/DSS, DoD/DTSA, State/DDTC, Treasury/OFAC, White House, and similar websites of Australia, Canada, U.K., and other countries and international organizations.  Due to space limitations, we do not post Arms Sales notifications, Denied Party listings, or Customs AD/CVD items.

* RIGHTS & RESTRICTIONS: This email contains no proprietary, classified, or export-controlled information. All items are obtained from public sources or are published with permission of private contributors, and may be freely circulated without further permission. Any further use of contributors’ material, however, must comply with applicable copyright laws.

* CAVEAT: The contents of this newsletter cannot be relied upon as legal or expert advice.  Consult your own legal counsel or compliance specialists before taking actions based upon news items or opinions from this or other unofficial sources.  If any U.S. federal tax issue is discussed in this communication, it was not intended or written by the author or sender for tax or legal advice, and cannot be used for the purpose of avoiding penalties under the Internal Revenue Code or promoting, marketing, or recommending to another party any transaction or tax-related matter.

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