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16-1227 Tuesday “The Daily Bugle”

16-1227 Tuesday “Daily Bugle”

Tuesday, 27 December 2016

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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
for advertising inquiries and rates. (The Daily Bugle was not published yesterday, Monday, 26 December. We hope you had a wonderful holiday.) 
 

  1. Commerce/BIS Amends EAR, Updates Based on the 2015 and 2016 NSG Plenary Meetings and Changes to NP Controls 
  2. Commerce/BIS Amends EAR Concerning Burma 
  3. Commerce/BIS Amends EAR, Adds 23 Russian Entities to the Entity List, and Clarifies License Review Policy 
  4. Commerce/BIS Seeks Comments on Entity List Requests 
  5. Commerce/BIS Seeks Comments on Five-Year Records Retention Requirement for Export Transactions and Boycott Actions 
  6. Commerce/BIS Seeks Comments on Technical Data Letter of Explanation 
  1. Ex/Im Items Scheduled for Publication in Future Federal Register Editions 
  2. Commerce/BIS: (No new postings.) 
  3. State/DDTC: (No new postings.) 
  1. Defense News: “US On Track for Record Foreign Weapon Sales” 
  2. Federal Times News: “US fails to renegotiate arms control rule for hacking tools” 
  3. Reuters: Brazilian Firms to Pay Record $3.5 Billion Penalty in Corruption Case” 
  4. Reuters: U.N. council fails to impose arms embargo on South Sudan 
  5. ST&R Trade Report: “Civil Nuclear Trade Advisory Committee to Meet Jan. 26” 
  6. ST&R Trade Report: “Electronic Filing of TSCA Certifications, Other Changes to CBP Regulations Adopted”  
  1. E.J. Krauland & A. Rapa: “Recent AML/Sanctions Enforcement Actions” 
  2. T. Murphy: “Dutiability of Royalties” 
  3. Z. Hadzismajlovic: “Apocalypse Soon? Permanent Disqualification From Department of Defense Contracts May Result From Voluntary Disclosures of Export Violations” 
  1. Monday List of Ex/Im Job Openings: 120 Jobs Posted 
  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 (27 Dec 2016), FACR/OFAC (23 Dec 2016), FTR (15 May 2015), HTSUS (16 Dec 2016), ITAR (5 Dec 2016) 

EXIMEX/IM ITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a1

1. Commerce/BIS Amends EAR, Updates Based on the 2015 and 2016 NSG Plenary Meetings and Changes to NP Controls
(Source: Commerce/BIS) [Excerpts.]
 
81 FR 94971-94974: Commerce Control List: Updates Based on the 2015 and 2016 Nuclear Suppliers Group (NSG) Plenary Meetings; Conforming Changes and Corrections to Certain Nuclear Nonproliferation (NP) Controls
* AGENCY: Bureau of Industry and Security, Commerce.
* ACTION: Final rule.
* SUMMARY: The Bureau of Industry and Security (BIS) publishes this final rule to amend the Export Administration Regulations (EAR) to reflect the understandings reached at the June 2015 Nuclear Suppliers Group (NSG) Plenary meeting held in Bariloche, Argentina, and certain understandings reached at the 2016 NSG Plenary meeting held in Seoul, Republic of Korea. The amendments to the EAR based on the 2015 meeting address the nuclear nonproliferation (NP) controls that apply to certain centrifugal multiplane balancing machines described on the Commerce Control List (CCL). The amendments to the EAR based on the 2016 meeting address the NP controls that apply to certain linear displacement measuring systems identified on the CCL. This rule also makes additional changes to the description of these systems on the CCL to fully conform to their description on the NSG Annex. In addition, this rule corrects an error in the technical parameters of the CCL entry that describes certain radiation-hardened TV cameras (including lenses therefor) that are subject to NP controls.
* DATES: This rule is effective December 27, 2016.
* FOR FURTHER INFORMATION CONTACT: Steven Clagett, Director, Nuclear and Missile Technology Controls Division, Office of Nonproliferation and Treaty Compliance, Bureau of Industry and Security, Telephone: (202) 482-1641.
* SUPPLEMENTARY INFORMATION: …
   This final rule amends the CCL by revising Export Control Classification Number (ECCN) 2B206: (1) To reflect the changes affecting certain linear displacement measuring systems listed in the NSG Annex, based on the understandings reached at the NSG Plenary meeting held in Seoul, Republic of Korea, on June 23 and 24, 2016; and (2) to further revise the description of these systems on the CCL to fully conform to their description on the NSG Annex. This rule also revises ECCN 2B229 to reflect the changes affecting certain centrifugal multiplane balancing machines listed in the NSG Annex, based on the understandings reached at the NSG Plenary meeting held in Bariloche, Argentina, on June 3-5, 2015. In addition, this rule corrects an error in the technical parameters of ECCN 6A203.d, which describes certain radiation-hardened TV cameras identified on the NSG Annex. …
 
   Dated: December 20, 2016.
Kevin J. Wolf, Assistant Secretary for Export Administration.
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EXIM_a2

2. Commerce/BIS Amends EAR Concerning Burma

(Source: Federal Register) [Excerpts.]
 
81 FR 94962-94963: Burma: Amendment of the Export Administration Regulations Consistent With an Executive Order That Terminated U.S. Government’s Sanctions
* 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) consistent with Executive Order 13742 of October 7, 2016. That Executive Order terminated the national emergency with respect to the actions and policies of the Government of Burma (Burma) and revoked several Burma-related Executive Orders in recognition of Burma’s substantial advances to promote democracy, including historic elections held in November 2015 that resulted in the formation of a democratically elected, civilian-led government. Specifically, in this rule, BIS removes license requirements and other restrictions on exports, reexports or transfers (in country) of items subject to the EAR made to persons whose property and interests in property were blocked pursuant to three Burma-related Executive Orders that were revoked on October 7, 2016. Consistent with the revised U.S. policy toward Burma, this rule also moves Burma from Country Group D:1 to Country Group B, a less restrictive country group placement under the EAR.
* DATES: This rule is effective December 27, 2016.
* FOR FURTHER INFORMATION CONTACT: Tracy Patts, Foreign Policy Division, Office of Nonproliferation and Treaty Compliance at telephone (202) 482-4252 or email Tracy.Patts@bis.doc.gov.
* SUPPLEMENTARY INFORMATION: …
   In recognition of Burma’s substantial advances to promote democracy identified by President Obama in Executive Order 13742, BIS is also removing Burma from Country Group D:1 and placing it in Country Group B, a change that typically broadens the scope of license exceptions which may be available for exports and reexports of items under the EAR. Note, however, that Burma will remain in Country Group D:3 (countries raising proliferation concerns related to chemical and biological weapons). Burma will also remain in Country Group D:5 (U.S. Arms Embargoes), consistent with Sec. 126.1 of the International Traffic in Arms Regulations, 22 CFR 120-130, and State Department Federal Register notices. Therefore, the country is subject to the general license exception restrictions described in section 740.2(a)(12) of the EAR that apply to 9×515 or “600 series” items destined to, shipped from, or manufactured in a destination listed in Country Group D:5, except as narrowly provided in subparagraphs (a)(12)(i) and (ii). Further, Burma will remain in Computer Tier 3 in part 740 (License Exceptions) pending additional consideration. Finally, as a general matter, exports and reexports to Burma, and transfers (in country), remain subject to EAR part 744 end user and end-use based controls. …
 
   Dated: December 20, 2016.
Kevin J. Wolf, Assistant Secretary for Export Administration.

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EXIM_a3

3. Commerce/BIS Amends EAR, Adds 23 Russian Entities to the Entity List, and Clarifies License Review Policy

(Source: Federal Register) [Excerpts.]
 
81 FR 94963-94971: Russian Sanctions: Addition of Certain Entities to the Entity List, and Clarification of License Review Policy
* AGENCY: Bureau of Industry and Security, Commerce.
* ACTION: Final rule. …
* DATES: This rule is effective December 27, 2016.
* FOR FURTHER INFORMATION CONTACT: Chair, End-User Review Committee, Office of the Assistant Secretary, Export Administration, Bureau of Industry and Security, Department of Commerce, Phone: (202) 482-5991, Email: ERC@bis.doc.gov.
* SUPPLEMENTARY INFORMATION: …
   This rule implements the decision of the ERC to add twenty-three entities to the Entity List. These twenty-three entities are being added on the basis of Sec. 744.11 (License requirements that apply to entities acting contrary to the national security or foreign policy interests of the United States) of the EAR. The twenty-three entries being added to the Entity List consist of two entries in the Crimea region of Ukraine, and twenty-one entries in Russia.
   Under Sec. 744.11(b) (Criteria for revising the Entity List) of the EAR, persons for whom there is reasonable cause to believe, based on specific and articulable facts, have been involved, are involved, or pose a significant risk of being or becoming involved in, activities that are contrary to the national security or foreign policy interests of the United States and those acting on behalf of such persons may be added to the Entity List. The entities being added to the Entity List have been determined to be involved in activities that are contrary to the national security or foreign policy interests of the United States. Specifically, in this rule, BIS adds entities to the Entity List for violating international law and fueling the conflict in eastern Ukraine. These additions ensure the efficacy of existing sanctions on Russia. The specific additions to the Entity List and related authorities are as follows: …
 
   Dated: December 20, 2016.
Eric L. Hirschhorn, Under Secretary of Commerce for Industry and Security.

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EXIM_a4

4. Commerce/BIS Seeks Comments on Entity List Requests

(Source: Federal Register) [Excerpts.]
 
81 FR 95108: Submission for OMB Review; Comment Request; Entity List Requests
   The Department of Commerce will submit to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).
  – Agency: Bureau of Industry and Security.
  – Title: Entity List Requests.
  – Form Number(s): N/A.
  – OMB Control Number: 0694-0134.
  – Needs and Uses: This collection is needed to provide a procedure for persons or organizations listed on the Entity List to request removal or modification of the entry that affects them. The Entity List appears at 15 CFR part 744, Supp. No. 4. The Entity List is used to inform the public of certain parties whose presence in a transaction that is subject to the Export Administration Regulations (15 CFR 730-799) requires a license from the Bureau of Industry and Security (BIS). …
 
Sheleen Dumas, PRA Departmental Lead, Office of the Chief Information Officer.

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EXIM_a5

5. Commerce/BIS Seeks Comments on Five-Year Records Retention Requirement for Export Transactions and Boycott Actions

(Source: Federal Register) [Excerpts.]
 
81 FR 95108-95109: Proposed Information Collection; Comment Request; Five-Year Records Retention Requirement for Export Transactions and Boycott Actions
* AGENCY: Bureau of Industry and Security.
* ACTION: Notice. …
* DATES: Written comments must be submitted on or before February 27, 2017.
* ADDRESSES: Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at JJessup@doc.gov).
* FOR FURTHER INFORMATION CONTACT: Mark Crace, BIS ICB Liaison, (202) 482-8093 or at mark.crace@bis.doc.gov.
* SUPPLEMENTARY INFORMATION:
– Abstract: All parties involved in export transactions and the U.S. party involved in a boycott action are required to maintain records of these activities for a period of five years. These records can include memoranda, correspondence, contracts, invitations to bid, books of account, financial records, restrictive trade practice or boycott documents and reports. The five-year record retention period corresponds with the five-year statute of limitations for criminal actions brought under the Export Administration Act of 1979 and predecessor acts, and the five-year statute for administrative compliance proceedings. Without this authority, potential violators could discard records demonstrating violations of the Export Administration Regulations prior to the expiration of the five-year statute of limitations. …
 
Sheleen Dumas, PRA Departmental Lead, Office of the Chief Information Officer.

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EXIM_a6

6. Commerce/BIS Seeks Comments on Technical Data Letter of Explanation

(Source: Federal Register) [Excerpts.]
 
81 FR 95109-95110: Proposed Information Collection; Comment Request; Technical Data Letter of Explanation
* AGENCY: Bureau of Industry and Security.
* ACTION: Notice. …
* DATES: Written comments must be submitted on or before February 27, 2017.
* ADDRESSES: Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at JJessup@doc.gov).
* FOR FURTHER INFORMATION CONTACT: Mark Crace, BIS ICB Liaison, (202) 482-8093 or at mark.crace@bis.doc.gov.
* SUPPLEMENTARY INFORMATION:
– Abstract: These technical data letters of explanation will assure the Bureau of Industry and Security that U.S.-origin technical data will be exported only for authorized end-uses, users and destinations. The information contained in the letters describes the transaction and fixes the scope of technology to be exported, the parties to the transaction, their roles, the purpose for the export, and the methods authorized to be used in exporting the technology. The letters also place the foreign consignee on notice that the technical data is subject to U.S. export controls and may only be re-exported in accordance with U.S. law. …
 
Sheleen Dumas, PRA Departmental Lead, Office of the Chief Information Officer.

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OGSOTHER GOVERNMENT SOURCES

OGS_a17. Ex/Im Items Scheduled for Publication in Future Federal Register Editions
(Source: Federal Register)


* Commerce; RULES; Civil Monetary Penalty Adjustments for Inflation [Publication Date: 28 December 2016.] 
* * * * * * * * * * * * * * * * * * * *

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NWSNEWS

NWS_a110
. Defense News: “US On Track for Record Foreign Weapon Sales”

 
In just three short months, the US State Department has blown past its dollar total of foreign weapon sales cases for all of last year — but a close look at the numbers shows that industry should temper its expectations for the rest of 2017.
 
Through Dec. 23, the State Department has ok’d 21 foreign sales cases, worth an estimated total of $45.2 billion dollars. For all of fiscal year 2016, DSCA cleared $33.6 billion. In other words, it took the State Department less than three months to clear roughly $12 billion more of foreign military sales cases than it did all of last year.
 
If those trends hold up, 2017 would be on pace to beat the $68.6 billion record in total foreign weapons sales, set in 2012.
 
A few caveats are involved when discussing foreign sales. These are sales that are sent to Congress for final clearance, and then the actual agreement must be negotiated, so this total does not mean that the sale gets done. Additionally, the dollar figure can change as negotiations occur. However, the total foreign military weapon sales cases cleared by State is a widely used figure to judge the health of American defense exports, and so is notable.
 
So what’s driving the early surge? In this case, it’s quality over quantity.
 
The 21 sales through the first three months of the fiscal year are actually less than the 28 cases cleared in the first three months of FY16, but slightly more than the 18 cases cleared in the first three months of FY15.
 
But a pair of sales account for $31.2 billion, or a full two-thirds of the weapon sales for this year. And those two sales -72 F-15QA fighters for Qatar and 32 F/A-18E aircraft to Kuwait – were widely expected to be cleared in fiscal year 2016 but were delayed. (That’s actually similar to the 2012 situation, when a massive package of Saudi fighter jets and helicopters was finally cleared by State, and which drove the giant spike in value that year.)
 
Subtract the Qatar and Kuwait sales and deals cleared by the State Department for the first three months of FY17 come to just over $14 billion – less than the $18.1 billion cleared in the first three months of FY16.
 
Still, while a pair of big sales may account for the majority of the value, Daniel Yoon, an analyst with Avascent, notes that “sales are sales.”
 
  “Of course, this would mean that 2012 was a blockbuster year, and that 2015/2016/2017 are not indicative of an upward trend that suggests international partiality toward American defense wares, per se. What is worth noting is that the volume of FMS deals, when viewed in a five-year increment, certainly suggests an upward trend,” Yoon said, noting foreign weapon sales totals struggled to break $20 billion until 2008, and has done so every year since.
 
In fact, the spike from the occasional foreign fighter sale should not be downplayed, Yoon argues, because such high-end equipment remains America’s defining edge over foreign competitors.
 
  “No country will be able to touch the United States in the highest end of the market for at least another generation,” Yoon said. “So, therefore, fighter aircraft sales should remain in our calculations when considering the success of American defense exports, even if they only come around once every handful of years and make trends like this spikey.”
 
Remy Nathan, vice president of international affairs with the Aerospace Industries Association, says the early 2017 numbers are a good sign, but says it is important to take a step back and look beyond the dollar figure.
 
  “It’s also important to the question on ‘where were we unsuccessful in securing the sale? And also from a US government foreign policy and national security perceptive, have those record sales allowed us to advance all of our security cooperation priorities?'” Nathan said. “And if not, and I’m pretty sure the answer is no, we have to keep asking ourselves what’s next.”
 
He points out the FY17 total could be significantly higher had a jet fighter sale to Bahrain also been cleared. Instead, it ran into hurdles from the White House and its fate is in limbo. Meanwhile, Nathan raises concerns that while the US remains the global leader in foreign weapons sales, the growth rate has slowed over the last four years.
 
  “Our direct competitors, and in some cases countries that don’t share our same perspectives or foreign policy, their growth rates are advancing quite considerably,” Nathan said. “That’s both a tech issue and a geographic issue we need to be paying attention on.”
 
Doug Berenson, also of Avascent, agrees that the US needs to be aware of increasing competitiveness for foreign weapon sales.
 
  “The rest of the world is increasingly competitive. That includes more than just ‘the usual suspects’ like Russia, France, Germany, and the U.K. Firms in South Korea, Israel, Singapore, Turkey, Brazil and other countries are increasingly active in various sectors of the global defense market,” Berenson warned. “Over time, they will make their presence felt even more strongly.”
 
A side benefit of these numbers coming through so early could be that it captures the attention of the incoming administration of president-elect Donald Trump, which has made a number of statements about wanting to focus on increasing manufacturing work inside the US, Nathan said.
 
  “One could envision as much as our president elect is interested in trying to support high paying, high skill manufacturing in the country, these defense sales for allies and partners very much fit the bill,” Nathan said, before reiterating a call, first put forth by AIA head David Melcher in a Defense News editorial, for a robust national security cooperation strategy.
 
Overall, the Gulf region accounts for the vast majority of sales this year. 11 deals have been cleared for a total of 41.1 billion, or roughly 90 percent of the weapon sales this year. While that’s driven by the two big fighter sales mentioned above, there were also major deals cleared for CH-47F Chinooks to Saudi Arabia and Apache AH-64Es for the UAE. Both those deals were for roughly $3.5 billion.
 
Other major deals include a decision from Norway to buy five P-8 maritime surveillance aircraft ($1.75 billion), modernization of Abrams tanks for Kuwait ($1.7 billion), and procurement of ten Predator B unmanned systems for the UK ($1 billion).

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NWS_a2
11. Federal Times News: “US Fails to Renegotiate Arms Control Rule for Hacking Tools”

(Source: Federal Times)
 
The Obama administration has failed to renegotiate portions of an international arms control arrangement so that it’s simpler to export tools related to hacking and surveillance software – technologies that can be exploited by bad actors, but are also used to secure computer networks.
 
The rare reconsideration of a rule agreed to in 2013 by 41 countries was derailed at the plenary’s annual December meeting in Vienna, leaving it up to President-elect Donald Trump’s administration whether the U.S. pushes for revisions again next year.
 
The U.S. had pushed for more precise language to control the spread of such hacking tools without the unintended negative consequences for national cybersecurity and research that industry groups and lawmakers have complained about for months. They argue that the current language, while well meaning, broadly sweeps up research tools and technologies used to create or otherwise support hacking and surveillance software.
 
Rep. Jim Langevin, D-R.I., said in a statement Monday that he is “deeply disappointed” by the plenary’s decision and hoped the incoming administration will continue the effort.
 
  “U.S. cybersecurity and that of our allies will be imperiled if companies and researchers are not able to quickly share defensive tools,” said Langevin, who co-chairs of the Congressional Cybersecurity Caucus.
 
The White House referred questions Monday to the State and Commerce departments, neither of which immediately responded to requests for comment.
 
As one of those 41 member countries of the 1996 Wassenaar Arrangement, which governs the highly technical world of export controls for arms and certain technologies, the United States agreed to restrict tools related to cyber “intrusion software” that could fall into the hands of repressive regimes.
 
The voluntary arrangement relies on unanimous agreement to abide by its rules on export controls for arms such as tanks or military aircraft and “dual-use” technologies such as advanced radar that can be used for both peaceful and military means.
 
  “If anybody understands how quickly you need to respond to a fire, this would essentially impede the internet’s firefighters if it was left in place,” Moussouris said. But she also noted that such work involving an international body also can take time and finding precise language is critical.
 
The plenary did agree to tighten up language essentially specifying that the rule should apply to attacker code used to command and control malware, not regular computer defense tools that might have been caught in the rule, Moussouris said.
 
Efforts to come up with a workable U.S. rule have highlighted the difficulty of applying the export controls restricting physical items to a virtual world that relies on the free flow of information for network security. Many companies operate in multiple countries and routinely employ foreign nationals who test their own corporate networks across borders.
 
In May 2015, the Commerce Department’s Bureau of Industry and Security began working on its rule to abide by the arrangement and proposed denying the transfer of offensive tools – defined as software that uses “zero-day” exploits, or unpatched new vulnerabilities, and “rootkit” abilities that allow a person administrator-level access to a system.
 
Because in the cyber world testing a network often requires determining first how to exploit it and attempting to do so.

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NWS_a6
12. Reuters: Brazilian Firms to Pay Record $3.5 Billion Penalty in Corruption Case”

(Source: Reuters) [Excerpts.]

Brazil-based construction colossus Odebrecht SA and affiliated petrochemical company Braskem SA agreed on 21 December to pay at least $3.5 billion, the largest penalty ever in a foreign bribery case, to resolve international charges involving payoffs to Brazil’s state oil company and others. Odebrecht and Braskem pleaded guilty in U.S. federal court in Brooklyn to conspiring to violate a U.S. foreign bribery law after an investigation involving political kickbacks at Brazil’s Petrobras unearthed the bribery scheme.
 
The huge penalty was negotiated as part of a broad settlement with U.S., Brazilian and Swiss authorities. Some of the hundreds of millions of dollars used in bribes to secure lucrative business deals flowed through the American banking system and some of the schemes were planned in the United States, enabling U.S. authorities to claim jurisdiction in the case.
 
Odebrecht is Latin America’s biggest engineering firm. Braskem, the region’s biggest petrochemical producer, is jointly owned by Odebrecht and Petrobras.
 
Their guilty pleas were the first in the United States following a nearly three-year investigation in Brazil dubbed “Operation Car Wash” into corruption at Petrobras, which has led to dozens of arrests and political upheaval in Brazil. … Odebrecht and Braskem were charged with conspiring to violate the U.S. Foreign Corrupt Practices Act, which is aimed at deterring companies from bribing officials overseas.
 
  “Odebrecht and Braskem used a hidden but fully functioning Odebrecht business unit – a ‘Department of Bribery,’ so to speak – that systematically paid hundreds of millions of dollars to corrupt government officials in countries on three continents,” U.S. Deputy Assistant Attorney General Suh said in a statement. From 2001 to 2016, Odebrecht paid approximately $788 million in bribes in association with 100 projects in 12 countries, including Brazil, Argentina, Colombia, Mexico and Venezuela, according to the U.S. charging papers. The companies hid the bribes through carefully disguised payments routed through a network of shell companies as well as suitcases of cash left at preset locations, Suh said. …
 
According to U.S. prosecutors, Odebrecht said it was able to pay $2.6 billion although it agreed the appropriate criminal fine would be $4.5 billion. The judge scheduled sentencing for April, when the deal would become finalized. Braskem also agreed to more than $632 million in criminal penalties and fines as well as additional money to the U.S. Securities and Exchange Commission and Swiss and Brazilian authorities, the SEC said. …

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NWS_a3
13. Reuters: U.N. council fails to impose arms embargo on South Sudan

(Source: Reuters)
 
The United Nations Security Council failed on Friday to adopt a U.S.-drafted resolution to impose an arms embargo and further sanctions on South Sudan despite warnings by U.N. officials of a possible genocide in the world’s newest state.
 
There were seven votes in favor and eight abstentions. A resolution needs nine votes in favor and no vetoes by the United States, France, Russia, Britain or China to be adopted. Washington called for a vote on Friday knowing it would fail.
 
The United States could not even win over its ally Japan, which last month deployed troops to a U.N. peacekeeping mission in South Sudan. Japan, Russia, China, Angola, Malaysia, Venezuela, Egypt and Senegal all abstained.
 
  “The council members who didn’t support this resolution are taking a big gamble that South Sudan’s leaders will not instigate a catastrophe,” said U.S. Ambassador to the United Nations, Samantha Power. “It is the people of South Sudan who will pay an unbearable price.”
 
She said the United States was prepared to push for another vote on an arms embargo in the future.
 
  “We’re not in favor of using sanctions to exert pressure on developing countries,” China’s Deputy U.N. Ambassador Wu Haitao said. “There needs to be prudent actions with respect to embargoes and designations to avoid complicating the situation even further in South Sudan.”
 
The resolution had also proposed blacklisting South Sudan opposition figure Riek Machar, army chief Paul Malong and Information Minister Michael Makuei.
 
Political rivalry between President Salva Kiir, an ethnic Dinka, and Marchar, his former deputy, led in 2013 to civil war that often has followed ethnic lines. The pair signed a peace deal last year, but fighting has continued. Machar, a Nuer, fled in July and is now in South Africa.
 
  “This resolution would not have been a panacea, we are not naive,” said Power, though she added that the measure would have cut arms sales to a state that “instead of feeding its people is amping up and arming up for an increasing ethnic conflict.”
 
U.N. Secretary-General Ban Ki-moon on Monday told the Security Council that he feared genocide was about to start in South Sudan unless immediate action is taken, renewing his months-long plea for an arms embargo.
 
South Sudan’s U.N. ambassador, Akuei Bona Malwal, said such descriptions were exaggerated and did not “reflect the reality on the ground.”
 
U.N. peacekeepers have been in South Sudan since the nation gained independence from Sudan in 2011, and there currently are some 13,700 U.N. troops and police in the country.

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NWS_a4
14. ST&R Trade Report: “Civil Nuclear Trade Advisory Committee to Meet Jan. 26”

 
The DOC’s Civil Nuclear Trade Advisory Committee will hold an open meeting Jan. 26 in Washington, D.C. This committee advises the DOC regarding the development and administration of programs to expand U.S. exports of civil nuclear goods and services in accordance with applicable U.S. laws and regulations, including advice on how U.S. policies, programs, and activities will affect the U.S. civil nuclear industry’s competitiveness and ability to participate in the international market.
 
The upcoming meeting will include an update on the Civil Nuclear Trade Initiative, the election of CINTAC leadership, a discussion on civil nuclear trade promotion activities, and a period for public comment. Those wishing to attend this session or to submit comments for consideration during the meeting should notify the DOC no later than Jan. 20

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NWS_a5
15. ST&R Trade Report: “Electronic Filing of TSCA Certifications, Other Changes to CBP Regulations Adopted”

 
U.S. Customs and Border Protection and the Treasury Department have issued a final rule amending, effective Jan. 26, the CBP regulations regarding the requirement to file a Toxic Substances Control Act certification when importing into the customs territory of the U.S. chemicals in bulk form or as part of mixtures and articles containing a chemical or mixture. The rule amends the regulations to establish an electronic option for importers to file the required Environmental Protection Agency TSCA certifications, consistent with the Security and Accountability for Every Port Act of 2006. The regulations have also been amended to clarify and add certain definitions and eliminate the paper-based blanket certification process.
 
When a TSCA chemical substance is imported in bulk form or as part of a mixture or a non-TSCA chemical is imported, an importer or its customs broker must submit a signed certification stating that either (1) all chemical substances in the shipment comply with all applicable rules or orders under TSCA and the importer is not offering a chemical substance for entry in violation of TSCA or any rule or order thereunder (a positive certification), or (2) all chemicals in the shipment are not subject to TSCA (a negative certification).
 
Currently, the TSCA certification must be filed with the director of the port of entry before release of the shipment. The certification may appear as a typed or stamped statement either (1) on the entry document or commercial invoice or on a preprinted attachment thereto, or (2) in the case of a release under a special permit for an immediate delivery under 19 CFR 142.21 or in the case of an entry under 19 CFR 142.3, on the commercial invoice or an attachment thereto. Further, importers are allowed to use paper blanket certifications, which are valid at one port of entry for one year.
 
The changes implemented through the final rule include the following.
 
  – providing an electronic option for filing TSCA certifications and notices of exportation and abandonment
  – requiring the submission of additional information relating to the certifying individual, including name, phone number and email address, for TSCA certifications submitted either in writing or electronically
  – eliminating the blanket certification process, which has limited utility and is more burdensome than the current entry-specific certification process
  – including language to make clear that the regulation applies to the importation of chemicals regardless of whether they are chemical substances subject to TSCA
  – revising and adding definitions to clarify that certification obligations apply to both chemical substances and mixtures that are subject to TSCA (which require a positive certification) and those that are not (which require a negative certification unless clearly identified as a TSCA-excluded chemical)
  – concluding the PGA message set test with regard to the submission of the TSCA certification

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

COMMCOMMENTARY

COMM_a116
. E.J. Krauland & A. Rapa: “Recent AML/Sanctions Enforcement Actions”

 
* Authors: Edward J. Krauland, Esq., ekrauland@steptoe.com, 202-429-8083; and Anthony Rapa, Esq., arapa@steptoe.com, 202-429-8120. Both of Steptoe & Johnson LLP.
 
Capping off a year of robust sanctions enforcement, two recent enforcement actions highlight the risks of doing business with sanctioned countries, in particular Iran.  In December 2016, federal and New York state regulators initiated enforcement actions related to alleged sanctions violations involving Iran.  In the first enforcement action, Italy’s largest retail bank, Intesa Sanpaolo SpA (Intesa), was alleged to have engaged in dollar-clearing transactions on behalf of Iranian clients.  In the second action, a US person individual, Kenneth Zong, was alleged to have engaged in a scheme to move restricted Iranian funds out of South Korea and transfer them to Iranian recipients.  This advisory summarizes the enforcement actions against Intesa and Mr. Zong.
 
Intesa Sanpaolo
 
Intesa agreed on December 15, 2016 to pay a $235 million fine to the New York State Department of Financial Services (NYDFS) in settlement of allegations that Intesa violated New York anti-money laundering (AML) laws and the Bank Secrecy Act (BSA).  The bank was found to have operated a deficient transaction monitoring system, conducting more than 2,700 dollar-clearing transactions on behalf of Iranian and other potentially sanctioned clients.  See NYDFS’s press release and consent order
 
According to the consent order, Intesa “utterly mismanaged” its transaction monitoring system and failed to identify suspicious transactions.  Among other things, NYDFS alleged that Intesa engaged in a pattern of conduct as follows:
 
  – Intesa processed thousands of transactions bearing strong indicia of shell company activity or other possible money laundering activity, which were cleared through its New York branch or other US banks or branches. Though a transaction monitoring program was in place, the New York branch’s designated anti-money laundering compliance officer allowed his staff to circumvent written policy by “clearing” keyword-based alerts based on their own judgment.  The clearances were never subject to any subject re-review, investigation, documentation, or internal audit.
  – Intesa utilized a faulty keyword alert policy that led the bank to miss at least 9 billion dollars’ worth of additional transactions. These programming errors included incorrectly-programmed alerts that contained extra spaces in the searches; searches that only contained the official country name rather than the commonly-used short forms of country names; and algorithms that searched three or more transaction within a single day period instead ten-day period.
  – Intesa used non-transparent practices to process payments on behalf of Iranian clients and other entities from 2002 to 2006. While these transactions were “U-Turn” transactions that may have been legally permissible under federal regulations in effect at the time (which have since been revoked), they involved non-transparent payment messages that deleted details from the transactions.  Because of this, neither the New York branch nor NYDFS had the opportunity to learn the true nature of the payments.
 
 
In addition to the monetary fine, Intesa-Milan and Intesa-New York are to jointly submit to NYDFS a written revised BSA/AML compliance program.  Additionally, Intesa-Milan and Intesa-New York are to submit a written revised internal audit plan, enhanced customer due diligence program, and program to reasonably ensure the identification and timely, accurate, and complete reporting by Intesa-New York of all known or suspected violations of law or suspicious transactions.
 
NYDFS noted that the enforcement action against Intesa highlighted the importance of the Department’s forthcoming anti-terrorism and AML regulation that requires regulated institutions to maintain certain specifically prescribed compliance programs.  NYDFS stated in its press release:
 
Today’s action further highlights the importance of DFS’s new risk-based anti-terrorism and anti-money laundering regulation that requires regulated institutions to maintain programs to monitor and filter transactions for potential BSA/AML violations and prevent transactions with sanctioned entities.  The final regulation requires regulated institutions to submit an annual board resolution or senior officer compliance finding confirming the steps taken to ascertain compliance with the regulation.
 
The new regulation will be effective January 1, 2017.  We will be publishing an advisory regarding the NYDFS regulation in the near future.

Kenneth Zong
 
On December 15, the US Department of Justice charged Kenneth Zong of Anchorage, Alaska with evading US sanctions on Iran and money laundering.  The charges are specified in an indictment and summarized in a press release.  Allegedly, Mr. Zong and one American and three Iranian co-conspirators engaged in fraudulent transactions intended to unlawfully convert and remove Iranian-owned funds worth approximately $1 billion from South Korean banks.  As explained in the indictment, the funds were held in controlled Korean bank accounts, and under Korean law, could only be applied towards the purchase of Korean commodities, with any subsequent transfer of the funds into the worldwide financial market subject to rigorous review by Korean regulators.  DOJ alleged that Mr. Zong acted to remove the funds from South Korea, convert them into other currencies, and transfer them to more than 10 countries around the world, at the behest of Iranian co-conspirators.
 
The scheme purportedly began in 2011, when Mr. Zong changed the name of his Korean company to “Anchore” and started fictitiously selling marble tiles and other construction supplies to an Iranian shell company in Iran.  Anchore then fictitiously purchased Italian marble tiles from another Iranian-controlled shell company in Dubai.  The fake purchases were accompanied by false and fictitious contracts, bills of lading, and invoices intended to satisfy Korean government bank regulators.  The sales enabled the transfer of money from the restricted Iranian bank account held at the Industrial Bank of Korea to Zong’s Anchore account, which then were then transferred to entities and individuals throughout the world.
 
Zong alone was named in a 47-count indictment charging him with conspiracy to violate the International Emergency Economic Powers Act, Iranian Transactions and Sanctions Regulations, and money laundering laws.  An arraignment date has not been set.
 
Conclusion
 
The recent enforcement actions demonstrate that sanctions against Iran are likely to continue as a focus for enforcement for both the US Government and New York state, with violators facing very significant potential liability under applicable sanctions and money laundering laws.  An upcoming NYDFS regulation regarding compliance programs, effective January 1, 2017, is particularly worth noting, as it will impose a range of new compliance obligations on certain financial institutions regulated under New York state law.  We will publish an international law advisory regarding the regulation in the near future.

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

COMM_a2
17
. T. Murphy: “Dutiability of Royalties”

(Source: Author)

* Author: Ted Murphy, Baker & McKenzie LLP, ted.murphy@bakermckenzie.com, 202 452 7069

U.S. Customs and Border Protection (CBP) recently published a customs valuation ruling that we thought you might find to be of interest. The ruling, HQ H233376 (Sept. 19, 2016) (copy attached HERE) involves the dutiability of royalties paid to a licensor unrelated to the importer or the manufacturer of the imported merchandise. The issue in the ruling was whether the payment of royalties to a third party licensor unrelated to the manufacturer were considered to be a “condition of the sale” of the imported merchandise.

This ruling is worth a quick read, but we have summarized the key facts for your reference below.

The importer entered into an agreement with an unrelated U.S. patent holder to license certain utility patents. The license covered, among other things, the right to “make, have made, use, sell, offer for sale and import” licensed devices. The technology covered by the patents was developed in the United States.
The importer also entered into a manufacturing agreement with an unrelated Malaysian manufacturer to have the imported merchandise made. The agreement authorizes the manufacturer to use the technology disclosed to it by the company to make the imported merchandise. The importer declared upon importation the price it paid to the manufacturer for the goods.
The importer pays the U.S. patent holder a royalty based on the resale price of the imported merchandise in the United States.

Based on these facts, CBP concluded that (i) the royalty was related to the imported merchandise, and (ii) the importer was required to pay it directly to the licensor. As a result, the only remaining issue was whether the royalty payments were a “condition of the sale” of the imported merchandise. This is was particularly important here since the royalties were paid to a licensor who was unrelated to the manufacturer of the imported merchandise (i.e., is a royalty payment to an unrelated third party licensor a condition of the sale of merchandise between two other parties?).

CBP ultimately adopted what it referred to as a “practical, common sense” approach to this issue and concluded that the royalties were part of the dutiable value of the imported merchandise. CBP found it relevant that the royalties were for patents, as opposed to trademarks, and that the licensed technology was necessary to produce the imported merchandise.

The ruling highlights several important points all importers should keep in mind, namely:

  (1) royalties paid for patents are more likely to be dutiable under U.S. law than are royalties paid for trademarks, regardless of to whom they are paid (i.e., to the seller or even to a party unrelated to the seller);
  (2) the request for internal advice grew out of a Focused Assessment – which demonstrates how closely Regulatory Audit looks at such issues; and
  (3) the ruling was issued more than 4 years after the request for internal advice was originally submitted to CBP HQ — which demonstrates how long it takes CBP HQ to issue customs valuation rulings, in particular.

In light of the foregoing, all importers should confirm internally whether any royalties or licenses fees are paid in relation to any imported merchandise. If so, then the agreements should be reviewed to determine whether the royalties or license fees are dutiable additions to value. This is not particularly difficult to do.

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

COMM_a318
. Z. Hadzismajlovic: “Apocalypse Soon? Permanent Disqualification From Department of Defense Contracts May Result From Voluntary Disclosures of Export Violations”

 
* Author: Zlatko Hadzismajlovic, Esq.,
McCarter & English, LLP,
zh@mccarter.com
, 212-609-6843.
 
Etymology, particularly the Greek or Latin roots of words, aids our understanding in much the same way as root cause analysis does. The Greek word for disclosure is αποκάλυψη, transliterated to apokálypsi, or “apocalypse.” Nomen est omen. This came to mind while reading the pronouncements proffered by various agencies this year – each of which influences voluntary disclosures of export control violations.
 
What once was a practical and efficient avenue for industry to inform the cognizant agencies of possible violations appears to have become a byway littered with mines, thanks to proposed and final rules issued by the Directorate of Defense Trade Controls (DDTC) and the Department of Defense (DoD). As it presently stands, contractors interacting with export-controlled information could face ruinous consequences if they act too reflexively in addressing cybersecurity incidents and events.
 
DDTC Proposed Rule
 
Let’s start with DDTC – an agency within the Bureau of Political-Military Affairs of the Department of State, which promulgates (pursuant to the Arms Export Control Act [FN/1]), administers and enforces the International Traffic in Arms Regulations (ITAR) [FN/2] governing defense trade. [FN/3] DDTC encourages companies to voluntarily disclose [FN/4] potential ITAR violations and considers such actions a potentially mitigating factor in ITAR penalties. ITAR penalties, it ought to be emphasized, are fearsome in terms of both size and imposition. For example, a willfully false or misleading statement on a registration or license application could lead to a fine of $1 million, a 10-year prison sentence or both. [FN/5] Further, civil penalties for ITAR violations have been imposed on a strict liability basis (i.e., without any intentional wrongdoing whatsoever). It is, therefore, unsurprising that DDTC received in excess of 1,200 voluntary disclosures last year.
 
On November 28, the DDTC published a notice [FN/6] requesting comments (on or before December 28, 2016) regarding a fully electronic Form DS-7787 that would serve as the vehicle for the submission of voluntary disclosures of violations of the ITAR. Some of the more worrisome aspects of the departure from the prior, narrative-based paper filings include the addition of fields that require [FN/7] the registrant to:
 
  (1) name all individuals involved, and provide their addresses and contact details;
  (2) identify the root cause of the violation;
  (3) identify the number of violations; and
  (4) provide a discovery date.
 
The form must be certified by an empowered official under penalty of perjury. Disclosure of any of the enumerated items poses a problem, but companies ought to be particularly concerned about providing the names and addresses of the individuals involved.
 
By DDTC’s own admission, the proposed form is part of an “IT modernization project designed to streamline the collection and use of information” allowing DDTC “to more easily track and analyze submissions.” Indeed, the form requires information about “disclosures with substantially similar circumstances such that prior corrective actions should have prevented the instant violation; disclosures with the same or related fact patterns; disclosures submitted by other parties.” The foregoing ought to be well-considered given the potential that such statements may not only dismiss mitigation of penalties but instead also lead to aggravating factors that result in heightened penalties. The form allows for “notification of a third-party violation” if the submitter is reporting a violation for which it was not responsible. It follows that a submitter may also provide notification of a third party’s prior similar violations, if known. As discussed below, this should be cause for extraordinary concern to companies.
 
DoD Rule Requires Disclosure of Data Breach in 72 Hours
 
After it was several years in the making, on October 21, 2016, DoD issued its final rule [FN/8] imposing safeguarding and cyber-incident reporting requirements on defense contractors with IT systems that process, store or transmit covered defense information (CDI). Under the rule’s expanded view of CDI, “export-controlled data” has been expressly adopted from the National Archives and Records Administration’s Controlled Unclassified Information (CUI) Registry to mean:
 
Unclassified information concerning certain items, commodities, technology, software, or other information whose export could reasonably be expected to adversely affect the United States national security and nonproliferation objectives. To include dual use items; items identified in export administration regulations, international traffic in arms regulations and the munitions list; license applications; and sensitive nuclear technology information.
 
Notably, this is a rather broad definition for what constitutes export control data. In fact, the application of what constitutes export control data under the DFARS regime is limited only if it is “(1) marked or otherwise identified in the contract, task order, or delivery order and provided to the contractor by or on behalf of DoD in support of the performance of the contract; or (2) collected, developed, received, transmitted, used, or stored by or on behalf of the contractor in support of the performance of the contract.” In other words, if the contractor possesses other information that is export controlled but was not “provided to the contractor by or on behalf of DoD in support of the performance of the contract” or “collected, developed, received, transmitted, used, or stored by or on behalf of the contractor in support of the performance of the contract,” that information is not CDI, and its breach need not be reported.
 
To comply with the CDI safeguards, contractors must implement NIST SP 800-171 controls no later than December 31, 2017, pursuant to DFARS 252.204-7008. Contractors must also be prepared to preserve and protect images of all known affected information and systems for at least 90 days from reporting and provide DoD access to additional information or equipment necessary to conduct a forensic analysis. The data breach or cyber incident must be reported within 72 hours of discovery via the Incident Collection Form (ICF), [FN/9] regardless of the fact that contractor may not have all the information required by the form. Among the information sought on the ICF is the “type of compromise (unauthorized access, unauthorized release (which includes inadvertent release), unknown, not applicable).” Thus, within 72 hours of discovery, a contractor is required to report to DoD, inter alia, its unauthorized release, albeit inadvertent, of export-controlled data.
 
DoD Proposed Rule Would “Disqualify” Contractors With Export Control Violations
 
In the foregoing paragraphs, we’ve described DDTC’s and DoD’s respective disclosure paradigms concerning export control violations. It’s worthwhile noting that senior DDTC officials have stated publicly that everything DDTC does is coordinated with the Defense Technology Security Administration (DTSA). Indeed, DTSA is DDTC’s conduit to DoD. One infers that DDTC ought to have known that on October 31, 2016, DoD would issue a proposed rule titled “Withholding of Unclassified Technical Data and Technology from the Public Disclosure” [FN/10] (with public comments due on or before December 30, 2016). According to DDTC, the proposed rule took them by surprise. Truly, it surprised all of us.
 
By way of background, to receive technical data associated with DoD procurements, government contractors must, inter alia: (1) complete a DD 2354 Military Critical Technology Agreement with the U.S.-Canada Joint Certification Office, (2) mark and treat export-controlled information associated with DoD programs in accordance with various DoD directives, [FN/11] and (3) certify their compliance with U.S. export control laws. The proposed rule on “Withholding of Unclassified Technical Data and Technology from the Public Disclosure” states that when the DoD receives “substantial and credible information” that a qualified U.S. contractor has violated U.S. export controls, violated its certification, made a certification in bad faith, and/or omitted or misstated a material fact, DoD would temporarily revoke the contractor’s ability to access export-controlled technical data and technology. The temporary revocation becomes a disqualification unless the contractor rebuts the “substantial and credible information” underlying the revocation within 20 days.
 
DDTC has encouraged those in the industry to submit comments. Here, we propose the following concerns be raised during the comment period:
 
  – First, the DoD must clarify whether a contractor’s submission of a voluntary disclosure to DDTC, BIS or the National Security Division of the Department of Justice is “substantial and credible information” that may result in the temporary revocation of its right to receive controlled technical data from DoD.
  – Second, would DoD’s own requirement to report a data breach be treated as substantial and credible information if the breach were an unauthorized release of export-controlled data?
  – Third, would a third-party disclosure to DoD of such a breach be considered substantial and credible information of export control violations?
  – Fourth, how would DoD treat past voluntary disclosures of export control violations given that settlement agreements with cognizant agencies are publicly available and are replete with admissions of export control violations?
  – Fifth, does DoD actually think that any contractor, regardless of size, is able to conduct a meaningful investigation and provide a rebuttal within 20 days of discovering the substantial and credible information?
 
Will There Be Any Contractors Left to Perform the Contracts?
 
The cognizant agencies have a vested interest in encouraging industry to voluntarily disclose potential export control violations. Voluntary disclosures are very often a result of a contractor’s well-honed compliance program; i.e., if the compliance program weren’t vigorous, there would be no discovery and disclosure of the violation. The existing voluntary disclosure paradigm transfers the bulk of the investigative burden onto industry itself, often providing useful learning opportunities for both the contractor and the government. Industry engages with the cognizant agencies on a level plane, offering real-world penetration scenarios that enhance the government’s predictive ability. The paradigm is more efficient and more effective than if DDTC and BIS, for example, had to build enforcement arms to police and prod industry.

Industry and its counsel do not make disclosures casually; they must be done correctly. Forcing industry into a corner by (1) mandating disclosure of information that opens up other potential avenues of liability and (2) limiting discovery and rebuttal to unreasonable timelines will likely lead to fewer disclosures or result in incomplete and therefore invalid disclosures. Given the concerns raised by the proposed rules, industry must tread carefully and involve outside counsel in all aspects of investigation and disclosure of potential export control violations. More importantly, the opportunity to effect meaningful change during the comment period is fleeting.
 
—————
  [FN/1] 22 U.S.C. § 2778.
  [FN/2] 22 C.F.R. §§ 120-130.
  [FN/3] Broadly referring to exports, reexports, temporary imports and brokering activities relating to defense articles, defense technical data and defense services.
  [FN/4] Some disclosures are not voluntary. For example, anyone involved with or with knowledge of violations of ITAR §§ 123.17(j), 126.1(e)(2), 126.16(h)(8) and (n), and 127.17(h)(8) and (n) must notify DDTC of the violations or produce documents and information, respectively.
  [FN/5] 22. C.F.R. § 127.3.
  [FN/6] 81 FR 85668 (November 28, 2016).
  [FN/7] As part of the initial request for public comments, 81 FR 39994 (June 20, 2016), these fields were denoted as “required for full disclosure,” the inference being that the disclosure of said information is mandatory in order to receive mitigation benefits.
  [FN/8] DFARS 252.204-7012, Safeguarding Covered Defense Information and Cyber Incident Reporting (OCT 2016).
  [FN/9] The reporting is done electronically via http://dibnet.dod.mil.
  [FN/10] 81 FR 75352 (October 31, 2016).
  [FN/11] Directive 5230.24, for example, sets requirements regarding the identification and dissemination of export-controlled technical documents created by DoD-funded research, development, test and evaluation programs.

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

MSEX/IM MOVERS & SHAKERS

MS_a119
. Monday List of Ex/Im Job Openings: 120 Jobs Posted

(Source: Editor)  


 
Published every Monday or first business day of the week.  Send openings in the following format to
apbosch@fullcirclecompliance.eu
.
 
COMPANY; LOCATION; POSITION TITLE (WEBLINK); CONTACT INFO; REQ ID

#” New listing this week:

 

* Aerospace Industries Association; Arlington VA;
International Affairs Director
;
Remy.Nathan@aia-aerospace.org
# AkzoNobel; Arnhem, The Netherlands;
Manager Customs & International Trade
; Requisition ID: 160008QE

* Amazon; London, UK;
Senior Trade Compliance Program Manager (M/F)
; Requisition ID: 429019

* Amazon; Seattle WA;
Compliance Investigator
; Requisition ID: 432564

* Amazon; Seattle WA;
Sanctions Compliance Specialist
; Requisition ID: 467576

* Amazon; Seattle WA;
NA Compliance Analyst; Requisition ID: 256357

* Amazon; Seattle WA;
Prime Air Trade Compliance Program Manager; Requisition ID: 395658

# Amazon; Seattle WA;
Senior Compliance Audit Specialist
; Requisition ID: 473466

* Amazon; Singapore;
Sr. Trade Compliance Manager
; Requisition ID: 441734

* Amazon; Tokyo, Japan;
JP Export Compliance Manager
; Requisition ID: 464733


* AstraZeneca; Wilmington DE;
Sr. Import Analyst
; Requisition ID: R-001528

* Avigilon; Plano, TX;
Global Trade Compliance Manager
; Requisition ID: 2016-2551


* Bayer; Leverkusen, Germany;
Head of Customs & International Trade Classification (m/f)
; Requisition ID: 0000180456


* Boeing; Bristol, UK;
Trade Control Specialist
; Requisition ID: 1600018482


# Boeing; Englewood CO;
Intern – International Trade Regulations
; Requisition ID: 794168
# Boeing; Gdansk, Poland;
Compliance Specialist
; Requisition ID: 795762
# Boeing; Mesa AZ;
Trade Control Specialist
; Requisition ID: 1600021767

* Ciena; Hanover MD;
Global Logistics Cost Leader
; Requisition ID: R005158
#
Cobham Advanced Electronic Solutions; Exeter NH, Plainview, NY; Eatontown, NJ; and Lansdale, PA;
Export Compliance Manager
; Craig Beronja,
craig.beronja@cobham.com
; Requisition ID: 00LR5

* Colony Brands, Inc.; Monroe WI;
Assistant Trade Compliance Manager
; Requisition ID: 16-0954


* Coriant; Naperville IL;
Sr Mgr of Global Trade Compliance
; Requisition ID: 11353

* Crane Aerospace and Electronics; Chandler AZ;
Sr. Export Compliance Analyst; Requisition ID: 4725

* Crane Currency; Nashua NH;
Import/Export & Logistics Manager
; Requisition ID: 2016-1459 

* Crane Aerospace and Electronics, West Caldwell NJ;
Export Compliance Manager
; Requisition ID: 5411
# Cummins Inc.; Daventry, United Kingdom;
Lead Export Controls Analyst

* Curtiss-Wright; Charlotte NC;
Principal Trade Compliance Analyst
;
michelle.stinziano@curtisswright.com

* Diageo; Norwalk CT;
Trade Compliance Excellence Manager
; Requisition ID: 54069BR

*
DRS Technologies; Dayton OH;
Trade Compliance Specialist III
; Requisition ID: 61027

* DRS Technologies; Germantown MD;
Senior Trade Compliance Manager
;
Requisition ID: 54749

* ED & F Man; London, UK; Trade Support Specialist

* Edgewell Personal Care; Milford CT; 
Export Compliance and Security Lead
; Requisition ID: NAM00808

* Esterline Technologies Corporation; Bellevue WA;
Audit Manager – Compliance
; Requisition ID: 8215BR

* Esterline Technologies Corporation; Bellevue WA;
Sr. Trade Compliance Manager – Sensors & Systems (Engineering)
; Requisition ID: 8791BR
* Esterline Technologies Corporation; Brea, CA;
Logistics Coordinator
; Requisition ID:
8887BR

* Esterline Technologies Corporation; Brea CA;
Trade Compliance Manager; Requisition ID: 7333BR

* Esterline Technologies Corporation; Buena Park, CA;
Manager, Shipping and Inventory Control
; Requisition ID:
9046BR

* Esterline Technologies Corporation; Paso Robles CA;
Trade Compliance Manager
; Requisition ID: 6148BR

* Expeditors; Bangkok, Thailand; Regional Trade Compliance Manager – Indochina & Philippines
* Export Solutions Inc.; Melbourne FL; 

Trade Compliance Specialist II

info@exportsolutionsinc.com

* FLIR; Arlington VA;
Sr. Defense Trade Licensing & Compliance Analyst
; Requisition ID: 7924
* FLIR; Billerica MA; 
Sr. Defense Trade Licensing & Compliance Analyst
;
Requisition ID: 8008
* General Electric (Global Operations); Wash DC;
Administrator, International Trade Compliance
; Requisition ID: 2786498

* General Dynamics; South Wales, UK;
Senior Trade Compliance Officer
; Requisition ID: 6079

* HARMAN; Novi MI;
Senior Export Compliance Specialist; Requisition ID: 94688

* HARMAN; Novi MI;
Senior Import Compliance Specialist; Requisition ID: 94686

* Hewlett Packard Enterprise; Amstelveen, The Netherlands;
Customs and Compliance Manager
; Requisition ID: 1585140

*
Ingersoll Rand; San Diego, CA;
Latin America Trade Compliance Manager (Trilingual: English, Spanish, and Portuguese)
; Requisition ID: 1610632

* Intel; Santa Clara, CA;
Global Export Compliance Specialist
; Requisition ID: JR0814909

* Intel; Santa Clara CA;
Export Compliance Specialist
; Requisition ID: JR0005160

* Lam Research Corporation; Fremont CA:
Foreign Trade Analyst 6
; Requisition ID: 12079BR

* Leica Biosystems; Nußloch, Germany;
Trade Compliance Manager (Import-Export)
; Requisition ID: COR000633

* Linde; Stewartsville NJ;
Compliance Administrator; Requisition ID: 916130

* Lumber Liquidators; Toano VA;
Compliance Auditor
; Requisition ID: 913

* Lutron; Coopersburg PA;
Trade Manager-Export
; Requisition ID: 2926

* Lutron; Coopersburg PA; Trade Compliance Coordinator; Requisition ID: 2834

* Medtronic; Heerlen, The Netherlands;
Trade Compliance Analyst
; 16000DYY

* Meggitt PLC; Los Angeles CA;
Export Control/Trade Compliance Administrator
; Requisition ID: 22591

* Meggit PLC; Los Angeles CA;
Trade Compliance Officer

* Meggitt Control Systems; North Hollywood CA;
Trade Compliance Officer
;
jenn.avritt@meggitt.com
; Requisition ID: 23720

* Meggitt Advanced Composites Limited; Shepshed, UK;
Trade Compliance Officer
; Requisition ID: 22122

* Merck KGaA; South West England, UK;
Trade Compliance Specialist
; Requisition ID: 153405

* Moog; East Aurora NY;
Export Compliance Manager
;
anihill@moog.com
; Requisition ID: 161913
* North Dakota State University; Fargo, ND;
Research Integrity and Compliance Administrator-Export Control
; Requisition ID: 1600266

* Northrop Grumman T
echnology Services Sector, Advanced Defense Services (ADS) Division
; International Posting (Saudi Arabia);
Manager International Trade Compliance 1
(Saudi Arabia)
; Requisition ID: 16003577

* Northrop Grumman Corporation; Annapolis Junction MD;
International Trade Compliance Analyst
; Requisition ID: 16028623

* Northrop Grumman Corporation; Falls Church VA;
International Trade Compliance Analyst 3/4
; Requisition ID: 16026961

* Northrop Grumman Corporation; Falls Church VA;
International Trade Compliance Analyst 3/4
; Requisition ID: 16027133
* Northrop Grumman Corporation; Herndon VA;
International Trade Compliance Analyst 4
; Requisition ID: 16027421
* Northrop Grumman Corporation; Linthicum MD;
International Trade Compliance Analyst 1
; Requisition ID: 16028160


# Northrop Grumman Corporation; Redondo Beach CA;
International Trade Compliance Analyst 4
; Requisition ID: 16024309

* Northrop Grumman Corporation; San Diego CA;
International Trade Compliance Analyst 2
; Requisition ID: 16028561

# Northrop Grumman Sperry Marine; New Malden, UK;
Trade Compliance Coordinator
; Apply via
careers.uk@sperry.ngc.com

* NXP Semiconductors; Nijmegen, The Netherlands;
Export Control Officer, Requirements Manager
; R-10001504

* Pall Corporation; Portsmouth, UK;
Trade Compliance Specialist
; Requisition ID: SHA000201 

* Parexel; Buenos Aires, Argentina;
Trade Compliance Specialist
; Requisition ID: pare-10055899


*Raytheon; Arlington VA;
Export Licensing Manager I
; Requisition ID: 87321BR

* Raytheon; Cambridge MA;
Export Compliance Agreement Owner
; Requisition ID: 87607BR

* Raytheon; El Segundo CA;
Import Control & Compliance Administration
; Requisition ID: 87699BR

# Raytheon; El Segundo CA or McKinney TX;
Sr. Manager, Global Trade; Requisition ID: 90829BR

* Raytheon; Fullerton CA;
Global Trade Compliance Manager
; Requisition ID: 85521BR

* Raytheon; Indianapolis IN;
Principal SC Compliance Specialist
; Requisition ID: 84932BR

* Smith and Wesson; Springfield MA;
International Sales Administrator
; Requisition ID: SCB-1223


* State Department; Wash DC;
Supervisory Compliance Specialist; Requisition ID: HRSC/T/PM-2017-0003


* Tenneco; Edenkoben, Germany;
Global Trade Compliance Manager (m/w)
; Requisition ID: 176871-846

* Tesla Motors; Fremont CA;
International Tax Lead/Senior International Tax Counsel; Requisition ID: 35593

* Tesla Motors; Fremont CA;
Global Trade Compliance Manager
; Requisition ID: 40738 

* Tesla Motors; Fremont CA;
Global Supply Manager – Logistics; Requisition ID: 38153

* Tesla Motors; Fremont CA;
Group Manager – Logistics Sourcing; Requisition ID: 38574

* Textron Systems; Wilmington MA;
Principal Export Compliance Analyst
; Requisition ID: 242857


* Thales; Piscataway NJ;
Manager, Trade Compliance
; Requisition ID: R0012077

* Thales; Piscataway NJ;
Trade Compliance Specialist/Facility Security Officer; Requisition ID: R0012102

* ThermoFisher Scientific; Madison WI;
Import/Export Compliance Coordinator
; Requisition ID: 41440BR
* ThermoFisher Scientific; Matamoros, Mexico;
Import/Export Supervisor
; Requisition ID: 39750BR
* ThermoFisher Scientific; Shanghai, China;
Compliance Director, Greater China
; Requisition ID: 38520BR
* ThermoFisher Scientific; Shanghai, China;
Trade Compliance Specialist
; Requisition ID: 42144BR
* ThermoFisher Scientific; Shanghai, China;
Trade Compliance Specialist – CMC
; Requisition ID: 42143BR

* Toyota; Dallas TX;
Export Control Analyst
; Requisition ID: TMS003DS

* Tractor Supply Company; Brentwood TN;
Customs Process Manager
;
nknott@tractorsupply.com
; Requisition ID: 16-986

* Troy Corporation; Florham Park NJ;
Global Trade and Compliance Manager
; Requisition ID: 306


* United Technologies Corporation, UTC Aerospace Systems; Charlotte NC;
International Trade Compliance Auditor; Requisition ID:
34285BR
* United Technologies Corporation, UTC Aerospace Systems; Charlotte NC;
* United Technologies Corporation, UTC Aerospace Systems; Charlotte NC;
* United Technologies Corporation, UTC Aerospace Systems; Charlotte NC;
Program Manager, Customs; Requisition ID:
31331BR


* United Technologies Corporation, UTC Aerospace Systems; Charlotte NC;
Specialist, ITC IT Systems
; Requisition ID: 33792BR
* United Technologies Corporation, UTC Aerospace Systems; Charlotte NC;
Sr Mgr, Intl Trade Compl
; Requisition ID: 30525BR
* United Technologies Corporation, UTC Aerospace Systems; Windsor Locks CT;
ITC Investigator; Requisition ID: 28069BR

* XPO Logistics; Greenwich CT; Global Trade Compliance Analyst

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

ENEDITOR’S NOTES

(Source: Editor) 

 
*
Henry Miller (Henry Valentine Miller (26 Dec 1891 – 7 Jun 1980, was an American writer known for breaking with existing literary forms, developing a new sort of semi-autobiographical novel that blended character study, social criticism, philosophical reflection, explicit language, sex, surrealist free association and mysticism. His most characteristic works of this kind are
Tropic of Cancer (1934),
Black Spring (1936),
Tropic of Capricorn (1939) and
The Rosy Crucifixion trilogy (1949-59), all of which were banned in the United States until 1961.)

  – “In this age, which believes that there is a short cut to everything, the greatest lesson to be learned is that the most difficult way is, in the long run, the easiest.”

 

Monday was pun day, but we didn’t run a pun, so here’s one:

 

Two explorers are tromping through the woods in Alaska. They suddenly come upon a large group of Grizzlies who are just standing and staring at the men. “What’s going on there?” says one of the explorers. “Not sure,” says the other one, “Bears watching.”

  — David Farrar, Springfield, OH 

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

EN_a321
. 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: 27 Dec 2016: 81 FR 94971-94974: Commerce Control List: Updates Based on the 2015 and 2016 Nuclear Suppliers Group (NSG) Plenary Meetings; Conforming Changes and Corrections to Certain Nuclear Nonproliferation (NP) Controls; 81 FR 94962-94963: Burma: Amendment of the Export Administration Regulations Consistent With an Executive Order That Terminated U.S. Government’s Sanctions; and 81 FR 94963-94971: Russian Sanctions: Addition of Certain Entities to the Entity List, and Clarification of License Review Policy 

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
  – Last Amendment: 23 Dec 2016: 81 FR 94254-94259: Iranian Transactions and Sanctions Regulations  
 
*
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.  

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

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.

* SUBSCRIPTIONS: Subscriptions are free.  Subscribe by completing the request form on the Full Circle Compliance website.

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