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17-0105 Thursday “The Daily Bugle”

17-0105 Thursday “Daily Bugle”

Thursday, 5 January 2016

TOPThe 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.

[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. State/DDTC: (No new postings.) 
  1. ST&R Trade Report: “Import Certificates to be Required for Organic Products Shipped from Mexico”
  2. The Wall Street Journal: “Chinese Access to U.S. Semiconductor Industry May Be Curbed”
  1. D.F. Feldman, J.C. Poling & Wynn H. Segall: “United States Imposes Cybersecurity Sanctions on Russia”
  2. J.E. Bartlett: “How Well Do You Know the ITAR? – Quick Quiz”
  3. M.M. Gatti & L.K. Rothberg: “Legal Bases for Iran Sanctions, Cuba Sanctions, and NAFTA”
  4. Gary Stanley’s ECR Tip of the Day
  1. ECTI Presents United States Export Control (EAR/OFAC/ITAR) Seminar in Singapore, 20-23 Mar 
  2. University of Liverpool Talks International Trade Compliance in London, 24 Jan 
  1. Answer to ITAR Quick Quiz 
  2. Bartlett’s Unfamiliar Quotations 
  3. Are Your Copies of Regulations Up to Date? Latest Changes: ATF (15 Jan 2016), Customs (20 Dec 2016), DOD/NISPOM (18 May 2016), EAR (4 Jan 2017), FACR/OFAC (23 Dec 2016), FTR (15 May 2015), HTSUS (1 Jan 2017), ITAR (3 Jan 2017) 

EXIMEX/IM ITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a1


[No items of interest noted today.]
 

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OGS
OTHER GOVERNMENT SOURCES

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

* Commerce; NOTICES; Export Privileges; Denials [Publication Date: 6 January 2017.]:
  – Dane Francisco Delgado
  – Kamran Ashfaq Malik

* Commerce; NOTICES; Orders; Robert Luba [Publication Date: 6 January 2017.]

* Treasury; Foreign Assets Control Office; NOTICES; Blocking or Unblocking of Persons and Properties [Publication Date: 6 January 2017.]

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

OGS_a22. Commerce/BIS: (No new postings.)

(Source: Commerce/BIS)
* * * * * * * * * * * * * * * * * * * *

OGS_a33. State/DDTC: (No new postings.)

(Source: State/DDTC)
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NWSNEWS

NWS_a14
. ST&R Trade Report: “Import Certificates to be Required for Organic Products Shipped from Mexico”

 
The Department of Agriculture’s Agricultural Marketing Service has announced that on Jan. 16 all organic products entering the U.S. from Mexico will have to be accompanied by a National Organic Program import certificate. Mexico plans to impose a similar requirement for organic products imported from the U.S. in early 2017.
 
NOP import certificates are used to verify that products shipped to the U.S. comply with the USDA organic regulations and must be issued by an accredited certifying agent. USDA currently requires such certificates for organic imports coming from European Union member states, Japan, South Korea, and Switzerland.
 
The USDA will host two separate webinars Jan. 10 to help certifying agents and importers understand the import certificate requirement and prepare for its implementation with respect to Mexico.

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NWS_a2
5. The Wall Street Journal: “Chinese Access to U.S. Semiconductor Industry May Be Curbed”

(Source: The Wall Street Journal) [Subscription required.]
 
The Obama administration is completing a study that could lead to restrictions on Chinese investment in the U.S. semiconductor sector.
 
The report, being prepared by President Barack Obama’s chief science adviser and due to be published before he leaves office this month, will include recommendations aimed at bolstering protection of an industry deemed critical to national security, according to people familiar with the study.
 
Among its recommendations could be a tougher stance by the Committee on Foreign Investment in the U.S., or CFIUS, a secretive multi-agency panel that reviews foreign acquisitions of U.S. assets for national security threats.
 
The report will give guidance to CFIUS on China’s strategic efforts to dominate the semiconductor market and could lead to new export controls and restrictions on joint-ventures with Chinese firms, according to industry officials.
 
The Obama administration’s dialing up of its scrutiny of Chinese investment in the U.S. is a rare alignment of policy with the incoming Trump team, which has promised a tough stance with the Asian powerhouse.
 
  “A loss of leadership in semiconductor innovation and manufacturing could have significant adverse impacts on the U.S. economy and even on national security,” John Holdren, the president’s chief science adviser, said in October.
 
CFIUS, established in 1975 to protect national interests from foreign investment, is chaired by the Treasury Department and has members from the departments of Justice, Defense, State and at least five other executive offices. It has the power to unilaterally block mergers and acquisitions of U.S. assets by foreign investors, and can require terms preventing the transfer of sensitive information and technology deemed important to national security. Often mere notification of a review by the panel discourages deals. Most of its dealings are confidential and meetings secret.
 
The CFIUS panel has approved some Chinese deals in recent years, including a bid for the Chicago stock exchange. However it has already ratcheted up its oversight of proposed semiconductor acquisitions.
 
Last month it rejected the proposed sale of Aixtron SE of Germany-which has a U.S. subsidiary-to Grand Chip Investment GmbH, the German unit of China’s Fujian Grand Chip Investment Fund. The CFIUS panel also forced the withdrawal of two other Chinese acquisition targets in the U.S. over the past 24 months.
 
The U.S. government views the semiconductor sector as one of the nation’s most critical industries, given that it makes computer chips for everything from smartphones to missiles, satellites to energy grids. U.S. officials are concerned the Chinese could gain backdoor entry into just about anything related to national security, including communications and military weapon systems. …

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COMMCOMMENTARY

COMM_a1
6. D.F. Feldman, J.C. Poling & Wynn H. Segall: “United States Imposes Cybersecurity Sanctions on Russia”

 
* Authors: Daniel F. Feldman, Esq., dfeldman@akingump.com, 202-887-4035; Jonathan C. Poling, Esq., jpoling@akingump.com,
202-887-4029; Wynn H. Segall, Esq., wsegall@akingump.com, 202-887-4573. All of Akin Gump Strauss Hauer & Feld LLP in Washington DC.
 
Key Points
 
  – This action marks the first time sanctions have been imposed under the Cybersecurity Sanctions Program established on April 1, 2015, with the designation of nine entities and individuals.
  – President Obama expanded the scope of the executive order creating the Cybersecurity Sanctions Program to allow for designations against persons determined to have engaged in malicious cyber­-enabled activities directed at, interfering with or undermining election processes or institutions in the United States or abroad.
  – Five entities that are subject to the new sanctions are now also subject to export licensing requirements by the U.S. Department of Commerce.
  – Clients subject to U.S. jurisdiction should ensure that their screening software is updated to safeguard their compliance obligations against transactions involving the newly designated persons and entities.
  – Clients should review the technical information released to evaluate and assess potential cyber intrusion risks.
 
Overview of Actions Taken by the United States
 
On December 29, 2016, President Obama announced that he was sanctioning nine individuals and entities: the Main Intelligence Directorate (aka Glavnoe Razvedyvatel’noe Upravlenie) (GRU) and the Federal Security Service (aka Federalnaya Sluzhba Bezopasnosti) (FSB), two Russian intelligence services; four individual officers of the GRU; and three companies that were stated to have provided material support to the GRU’s cyber operations. In addition, two Russian individuals were sanctioned for using cyber-enabled means to cause misappropriation of funds and personal identifying information. These actions mark the first expansion of the Specially Designated Nationals (SDN) List to include entities and individuals under the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) cybersecurity program since it was established on April 1, 2015. The 2015 client alert can be found here.
 
On January 4, 2017, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) added the five entities newly designated as SDNs to the Entity List. As a result of such designations, additional licensing requirements and restrictions apply to exports, re-exports, and transfers (in-country) to these entities under the Export Administration Regulations (EAR).
 
The State Department also announced that it is denying Russian access to two Russian government-­owned recreational compounds in Maryland and New York and is declaring “persona non grata” 35 officials from the Russian Embassy in Washington and the Russian Consulate in San Francisco. The State Department announced that these measures were part of a comprehensive response to Russia’s interference in the U.S. election; a pattern of harassment of U.S. diplomats overseas (including arbitrary police stops, physical assault and the broadcast on Russian State TV of personal details about our personnel that put them at risk); and Russian government actions that the State Department maintained impeded U.S. diplomatic operations.
 
Finally, on December 29, the Department of Homeland Security and the Federal Bureau of Investigation (FBI) released declassified technical information on Russian civilian and military intelligence service cyber activity to allow for the public to be able to better identify, detect and disrupt “Russia’s global campaign of malicious cyber activities.” This Joint Analysis Report follows the October 7, 2016, joint statement by Secretary Johnson and Director Clapper that the intelligence community was confident that the Russian government directed recent compromises of emails from U.S. persons and institutions and that the disclosures of alleged hacked emails was consistent with the Russian­-directed efforts, both in the United States and to influence public opinion in Europe and Eurasia. The full Joint Analysis Report can be found here.
 
President Obama suggested that additional actions are already under way and forthcoming: “These actions are not the sum total of our response to Russia’s aggressive activities. We will continue to take a variety of actions at a time and place of our choosing, some of which will not be publicized.”
 
Congressional leaders have generally supported the December 29 actions by President Obama, with certain senior Republican members of Congress remarking that measures should have been taken earlier.
 
Russian President Vladimir Putin has indicated that he will not take retaliatory measures at this time and will await the inauguration of President-­elect Donald Trump. In response, President-­elect Trump praised President Putin’s restrained response to these measures.
 
These and other sanctions involving Russia are subject to potential change by executive order. Although the U.S. Congress is considering legislation to codify existing sanctions and/or impose additional sanctions against Russia, President-­elect Trump may seek to roll back these executive actions after he takes office on January 20, 2017. An initial indication of what is to come will likely occur during the upcoming confirmation hearings for Rex Tillerson as the nominee for Secretary of State, who has extensive business experience in Russia.
 
Cybersecurity Executive Order Expanded to Cover Election Interference
 
As originally issued in April 2015, Executive Order 13694 created an authority for the U.S. government to respond more effectively to the most significant cyber threats and targeted persons who engage in malicious cyber­-enabled activities. The President amended Executive Order 13694 to authorize sanctions on those who engage in malicious cyber­-enabled activities that have the purpose or effect of “tampering with, altering, or causing a misappropriation of information with the purpose or effect of interfering with or undermining election processes or institutions.”
 
Specific Additions to the SDN List
 
Under this new authority, President Obama added five entities and four individuals to the SDN List. The Fact Sheet issued by the White House explained the basis for each of these additions, indicating that each of these entities and individuals had tampered, altered or caused a misappropriation of information with the purpose or effect of interfering with the 2016 U.S. election processes, as explained below:
 
  – Two Russian intelligence services: the Main Intelligence Directorate (aka Glavnoe Razvedyvatel’noe Upravlenie) (GRU), which was involved in external collection using human intelligence officers and a variety of technical tools; and the Federal Security Service (aka Federalnaya Sluzhba Bezopasnosti) (FSB), which assisted the GRU in conducting the activities described above
  – Three companies that provided material support to the GRU’s cyber operations: the Special Technology Center (aka STLC, Ltd. Special Technology Center St. Petersburg), which assisted the GRU in conducting signals intelligence operations; Zorsecurity (aka Esage Lab), which provided the GRU with technical research and development; and Autonomous Noncommercial Organization “Professional Association of Designers of Data Processing Systems” (ANO PO KSI), which provided specialized training to the GRU
  – Four individual officers of the GRU: Igor Valentinovich Korobov, the current Chief of the GRU; Sergey Aleksandrovich Gizunov, Deputy Chief of the GRU; Igor Olegovich Kostyukov, a First Deputy Chief of the GRU; and Vladimir Stepanovich Alexseyev, also a First Deputy Chief of the GRU.
 
In addition, OFAC designated two Russian individuals under a pre­existing portion of Executive Order 13694 for using cyber­-enabled means to cause misappropriation of funds and personal identifying information, explaining the bases for such designations as indicated below:
 
  – Evgeniy Mikhailovich Bogachev, who engaged in significant malicious cyber­-enabled misappropriation of financial information for private financial gain; Bogachev and his associates were responsible for the theft of more than $100 million from U.S. financial institutions, Fortune 500 firms, universities and government agencies
  – Aleksey Alekseyevich Belan, who engaged in significant malicious cyber-enabled misappropriation of personal identifiers for private financial gain; Belan compromised the computer networks of at least three major United States­-based e­commerce companies, and he used his unauthorized access to steal user data belonging to approximately 200 million accounts worldwide and then actively engaged in successful efforts to sell the stolen information for private financial gain.
 
Both men have multiple arrest warrants pending in the United States for various computer­-related crimes and remain on the FBI’s Most Wanted List.
 
U.S. persons are prohibited from dealing with SDNs, and all assets of SDNs that are currently in, or come within, the United States or the possession or control of a U.S. person are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. Any entities that these SDNs own (defined as a direct or indirect ownership interest of 50 percent or more) are also blocked, regardless of whether those entities are separately named on the SDN List, and U.S. persons are generally prohibited from engaging in transactions with such entities as well. The individuals designated as SDNs will also be denied entry into the United States.
 
Corresponding Additions to the Entity List
 
Following OFAC’s designations, BIS added the two Russian intelligence agencies (GRU and FSB) and the three companies (Special Technology Center, Zorsecurity and ANO PO KSI) to the Entity List.
 
As a result of such designations, additional licensing requirements and restrictions apply to exports, re-exports and transfers (in-country) under the Export Administration Regulations (EAR) to such entities. Specifically, a license is required where items subject to the EAR are to be exported, re-exported, or transferred (in-country) to any of the entities added to the Entity List or in which such entities act as purchaser, intermediate consignee, ultimate consignee, or end-user. No license exceptions are available and BIS has imposed a presumption of denial policy to any license applications for the export, re-export or transfer of items subject to the EAR to these entities.
 
Practical Implications
 
Entities and individuals subject to U.S. jurisdiction should ensure that they do not engage in impermissible transactions with persons named on OFAC’s SDN List or any entity owned by such persons. Exporters should also ensure that their export compliance programs have adequate measures in place to address the export, re-export and transfer restrictions imposed by BIS. Additionally, U.S. officials are encouraging the public to review the declassified technical information relating to the cyber activities by Russia to help identify, detect and disrupt cyber activities that may have occurred or remain ongoing.
 
Additional Information
 
 


 

  – Bureau of Industry and Security: Addition of Certain Entities to the Entity List  

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COMM_a2
7. J.E. Bartlett: How Well Do You Know the ITAR? – Quick Quiz

(Source: Editor)

Question:
How many times is “Automated Export System” (AES) mentioned in the ITAR?
 
Answer:
 
A. None
B. Between 5 and 20
C. Over 20

Place your bets with your friends, then see answer below in Editor’s Notes.

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COMM_a3
8. M.M. Gatti & L.K. Rothberg: “Legal Bases for Iran Sanctions, Cuba Sanctions, and NAFTA”

* Authors: Margaret M. Gatti, Esq., Margaret.gatti@morganlewis.com, 202-739-5409; Louis K. Rothberg, Esq., louis.rothberg@morganlewis.com, 202-739-5281. Both of Morgan, Lewis & Bockius LLP.
 
How easily can the Trump administration change the status quo?
 
The International Emergency Economic Powers Act (IEEPA), 50 U.S.C §§1701-1707 enacted October 28, 1977, authorizes the US president to broadly regulate international commerce after declaring a national emergency in response to any unusual and extraordinary threat to the United States which has a foreign source. IEEPA is the current legal basis for most US economic sanctions other than the Cuba sanctions for which the legal basis is the Trading with the Enemy Act of 1917, (TWEA) 50 U.S.C. App. §§ 1-44.
 
Using IEEPA, the president may, under such regulations as he may prescribe, by means of instructions, licenses, or otherwise, investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States, and may issue such regulations, including regulations prescribing definitions, as may be necessary.
 
Economic sanctions begin typically when the president declares a national emergency under IEEPA for a particular foreign situation via an executive order published in the Federal Register. Executive orders (EOs) are legally binding orders issued by the president, acting as the head of the executive branch, to federal administrative agencies. EOs are generally used to direct federal agencies and officials in their execution of congressionally established laws or policies. They do not require congressional approval to take effect but have the same legal weight as laws passed by Congress. The president’s source of authority to issue EOs is Article II, Section 1 of the US Constitution, which grants to the president the “executive Power.” Section 3 of Article II further directs the president to “take Care that the Laws be faithfully executed.”
 
EOs can be challenged in court, usually on the grounds that the order deviates from “congressional intent” or exceeds the president’s constitutional powers. Courts generally have been accepting of presidential EOs made pursuant to a specific grant of authority as stipulated in an act of Congress. No EO declaring an emergency under IEEPA to impose economic sanctions has been voided by the courts. Typically in an IEEPA EO, the president directs the US Treasury Department’s Office of Foreign Assets Control (OFAC) to implement regulations in coordination with other departments to carry out the EO.
 
Iran
 
On January 16, 2016, President Obama issued EO 13716 which revoked or modified various other Iran-related EO’s that he had previously issued to implement sanctions against Iran, as authorized under IEEPA. No congressional action was required for the issuance of the previous EO’s and likewise none was required for the issuance of EO 13716. To implement EO 13716, OFAC revised its licensing policies toward Iran and relaxed many US sanctions that were in effect until January 15, 2016.
 
Given that President Obama used EO’s to implement sanctions against Iran and then issued a separate EO to revoke or modify previously issued Iran-related EO’s, it stands to reason that President-elect Donald Trump, upon taking office, can likewise unilaterally amend or revoke EO 13716, issue a new EO to reinstate the EO’s that were revoked or modified by EO 13716, or issue one or more additional EOs under IEEPA to impose new economic sanctions against Iran, both with respect to the activities of US and non-US persons involving Iran.
 
Cuba
 
As of 2017, Cuba is the only country restricted under the TWEA. The Cuba sanctions began before IEEPA was enacted in 1977, and thus TWEA was the main source of statutory authority for Cuban sanctions. TWEA restricts trade with countries hostile to the United States and authorizes the president to restrict trade between the US and its enemies in times of war. IEEPA grants somewhat broader powers to the president and is invoked during states of emergency when the country is not at war.
 
On October 14, 2016, President Obama issued a Presidential Policy Directive (not an EO) on Cuba which stated in part as follows:
 
“The United States Government will seek to expand opportunities for US companies to engage with Cuba. The embargo is outdated and should be lifted. My administration has repeatedly called upon the Congress to lift the embargo, and we will continue to work toward that goal. While the embargo remains in place, our role will be to pursue policies that enable authorized US private sector engagement with Cuba’s emerging private sector and with state-owned enterprises that provide goods and services to the Cuban people. Law enforcement cooperation will ensure that authorized commerce and authorized travelers move rapidly between the United States and Cuba. Although we recognize the priority given to state-owned enterprises in the Cuban model, we seek to encourage reforms that align these entities with international norms, especially transparency.
 
“United States regulatory changes have created space for the Cuban government to introduce comparable changes. In tandem with the Department of the Treasury’s regulatory change to expand Cuba’s access to the US financial system and US dollar transit accounts, the Cuban government announced in early 2016 plans to eliminate the 10 percent penalty on US dollar conversion transactions, subject to improved access to the international banking system. We will sustain private and public efforts to explain our regulatory changes to US firms and banks, Cuban entrepreneurs, and the Cuban government.”
 
In January 2015, the US government, through amendments to the US Commerce Department’s Export Administration Regulations [EAR] and OFAC’s Cuba regulations, began to liberalize US trade restrictions with Cuba to carry out President Obama’s December 17, 2014, declaration of a new US-Cuba policy. The new rules, issued in separate waves in 2015 and 2016, nonetheless leave the comprehensive US embargo against Cuba largely in effect.
 
For its part, the Cuban government has reacted very leisurely in revising its own laws and regulations to fully accept and implement within Cuba the limited relaxation that the new US rules authorize.
 
President-elect Trump can unilaterally amend or revoke any or all of these relaxations in the Cuba sanctions and issue new directives under TWEA restoring the status quo as of December 17, 2014.
 
NAFTA
 
Article 2205 of the North America Free Trade Agreement [NAFTA] allows the US to withdraw with six months’ written notice:
 
“A Party may withdraw from this Agreement six months after it provides written notice of withdrawal to the other Parties. If a Party withdraws, the Agreement shall remain in force for the remaining Parties.”
 
To whom in the US government does the constitution grant the power to terminate or withdraw from treaties? Arguments may be made that the power belongs to the president alone, the president and Senate, or in Congress. Thus, President-elect Trump can assert that he alone has the authority to withdraw the United States from NAFTA.
 
Historical practice provides support for all these arguments, and there is no definitive clarity on the question of how a treaty, once ratified, must be terminated. See Goldwater v. Carter, 617 F.2d 697 (D.C. Cir.) (en banc), vacated and remanded, 100 S. Ct. 533, 444 U.S. 996 (1979).

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COMM_a4
9. Gary Stanley’s ECR Tip of the Day
(Source: Defense and Export-Import Update; available by subscription from
gstanley@glstrade.com
)
 
* Author: Gary Stanley, Esq., Global Legal Services, PC, (202) 352-3059,
gstanley@glstrade.com
 
If your item or activity is subject to the scope of the EAR, you should consider each of the ten general prohibitions listed in EAR Par 736. General Prohibitions One (Exports and Reexports), Two (Parts and Components Reexports), and Three (Foreign-Produced Direct Product Reexports) (§736.2(b)(1), (2), and (3) of the EAR) are product controls that are shaped and limited by parameters specified on the CCL and Country Chart. General Prohibitions Four through Ten are prohibitions on certain activities that are not allowed without authorization from BIS, and these prohibitions apply to all items subject to the EAR unless otherwise specified (§736.2(b)(4) through (10) of the EAR).
  
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TEEX/IM TRAINING EVENTS & CONFERENCES

TE_a110. ECTI Presents United States Export Control (EAR/OFAC/ITAR) Seminar in Singapore, 20-23 Mar

(Source: Jill Kincaid; jill@learnexportcompliance.com)

* What: United States Export Control (EAR/OFAC/ITAR) Seminar Series in Singapore, (for Asia-Pacific and other non-US Companies)
* When: EAR/OFAC Seminar: March 20-21, 2017; ITAR Seminar: March 22-23, 2017
* Where: Singapore, Novotel Clarke Quay; 177A River Valley Road, Singapore
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker Panel: Scott Gearity, John Black, Scott Anderson & Rebekah Jones
* Register: Here, or Jessica Lemon, 540-433-3977, jessica@learnexportcompliance.com

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

TE_a211. University of Liverpool to Talk Post-Brexit 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 to hear David Hayes talk about Post-Brexit import and export regulations.
 
Taking place from 6 pm to 7 pm 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, with refreshments and networking to follow.
 
To attend, notify 
exed@liverpool.ac.uk
before 16 January.

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ENEDITOR’S NOTES

(Source: Editor)

Answer: (a) None.
 

DDTC removed all references to AES from the ITAR on January 3, 2017, in 82 Fed. Reg. 15 (effective Dec. 31, 2016). AES was replaced on 31 December by CBP’s International Trade Data System (ITDS). If this quiz had asked how many times was AES mentioned in the ITAR before the latest amendment, the correct answer would have been “Over 20.”  For example, ITAR

§ 
120.30, which defined Automated Export System, was removed.  In ITAR § 123.22(a), the old text said, “The reporting of the export information shall be to the U.S. Customs and Border Protection using the Automated Export System (AES) or directly to the Directorate of Defense Trade Controls (DDTC),” but the current text now says, “The reporting of the export information shall be to the U.S. Customs and Border Protection using its electronic system(s), or directly to the Directorate of Defense Trade Controls (DDTC), as appropriate.”


If you do not have a current updated ITAR, get a copy of the “BITAR”, which is up to date.  
See subscription information below, in item 14.
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(Source: Editor)


* Paramahansa Yogananda (Paramahansa Yogananda, 5 Jan 1893 – 7 Mar 1952, born Mukunda Lal Ghosh, was an Indian yogi and guru who introduced millions of westerners to the teachings of meditation and Kriya Yoga through his book, Autobiography of a Yogi.)

  – “The season of failure is the best time for sowing the seeds of success.”
  – “Remain calm, serene, always in command of yourself. You will then find out how easy it is to get along.”

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EN_a214
. 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: 4 Jan 2017: 82 FR 722-725: Addition of Certain Entities to the Entity List  

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
  – Last Amendment: 23 Dec 2016: 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 Jan 2017: 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: 1 Jan 2017: 2017 Basic HTS  

  – 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: 3 Jan 2017 (effective 31 Dec 2016): 82 FR 15-19: International Traffic in Arms Regulations: International Trade Data System, Reporting
  – The only available fully updated copy (latest edition 3 Jan 2017) of the ITAR with all amendments is contained in Bartlett’s Annotated ITAR (“BITAR”), by James E. Bartlett III.  (The GPO’s “eCFR” website copy of the ITAR has not yet been updated for all changes.) The BITAR contains all ITAR amendments to date, 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 subscribers to inform 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.

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