;

17-0203 Friday “The Daily Bugle”

17-0203 Friday “Daily Bugle”

Friday, 3 February 2017

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

  1. U.S. President Orders Reduce of Regulation and Control of Regulatory Costs 
  1. Ex/Im Items Scheduled for Publication in Future Federal Register Editions 
  2. Commerce/BIS: (No new postings.) 
  3. DoD/DSCA Posts SAMM Memoranda
  4. State/DDTC Posts Name Change of Night Vision Depot
  5. Treasury/OFAC Issues a Finding of Violation to B Whale Corporation Concerning Iranian Sanction Violation
  6. UK/DIT ECO Posts Overview of Revoked Versions of Sixteen Open General Export Licenses
  1. Reuters: “Trump Administration Tightens Iran Sanctions, Warns of More Measures”
  1. A. Hayer: “Canada: Trump’s NAFTA Pledge Threatens U.S. Expats In Canada”
  2. W. Maruyama, R. Kyle & B. Peters: “President Trump Will Have Broad Presidential Authority to Terminate Trade Agreements and Impose Punitive Duties on U.S. Trading Partners”
  1. Friday List of Approaching Events
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Changes: ATF (15 Jan 2016), Customs (27 Jan 2017), DOD/NISPOM (18 May 2016), EAR (1 Feb 2017), FACR/OFAC (17 Jan 2017), FTR (15 May 2015), HTSUS (1 Jan 2017), ITAR (11 Jan 2017)

EXIMEX/IM ITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a01
1
U.S. President Orders Reduction of Regulations and Control of Regulatory Costs

(Source:
Federal Register)
 
82 FR 9339-9341: Presidential Documents; Executive Order 13771 of January 30, 2017
 
Reducing Regulation and Controlling Regulatory Costs
 
By the authority vested in me as President by the Constitution and the laws of the United States of America, including the Budget and Accounting Act of 1921, as amended (31 U.S.C. 1101 et seq.), section 1105 of title 31, United States Code, and section 301 of title 3, United States Code, it is hereby ordered as follows:
 
Section 1. Purpose. It is the policy of the executive branch to be prudent and financially responsible in the expenditure of funds, from both public and private sources. In addition to the management of the direct expenditure of taxpayer dollars through the budgeting process, it is essential to manage the costs associated with the governmental imposition of private expenditures required to comply with Federal regulations. Toward that end, it is important that for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.
 
Sec. 2. Regulatory Cap for Fiscal Year 2017. (a) Unless prohibited by law, whenever an executive department or agency (agency) publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed.
  (b) For fiscal year 2017, which is in progress, the heads of all agencies are directed that the total incremental cost of all new regulations, including repealed regulations, to be finalized this year shall be no greater than zero, unless otherwise required by law or consistent with advice provided in writing by the Director of the Office of Management and Budget (Director).
  (c) In furtherance of the requirement of subsection (a) of this section, any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associ- ated with at least two prior regulations. Any agency eliminating existing costs associated with prior regulations under this subsection shall do so in accordance with the Administrative Procedure Act and other applicable law.
  (d) The Director shall provide the heads of agencies with guidance on the implementation of this section. Such guidance shall address, among other things, processes for standardizing the measurement and estimation of regulatory costs; standards for determining what qualifies as new and offsetting regulations; standards for determining the costs of existing regula- tions that are considered for elimination; processes for accounting for costs in different fiscal years; methods to oversee the issuance of rules with costs offset by savings at different times or different agencies; and emergencies and other circumstances that might justify individual waivers of the require- ments of this section. The Director shall consider phasing in and updating these requirements.
 
Sec. 3. Annual Regulatory Cost Submissions to the Office of Management and Budget. (a) Beginning with the Regulatory Plans (required under Executive Order 12866 of September 30, 1993, as amended, or any successor order) for fiscal year 2018, and for each fiscal year thereafter, the head of each agency shall identify, for each regulation that increases incremental cost, the offsetting regulations described in section 2(c) of this order, and provide the agency’s best approximation of the total costs or savings associated with each new regulation or repealed regulation.
  (b) Each regulation approved by the Director during the Presidential budget process shall be included in the Unified Regulatory Agenda required under Executive Order 12866, as amended, or any successor order.
  (c) Unless otherwise required by law, no regulation shall be issued by an agency if it was not included on the most recent version or update of the published Unified Regulatory Agenda as required under Executive Order 12866, as amended, or any successor order, unless the issuance of such regulation was approved in advance in writing by the Director.
  (d) During the Presidential budget process, the Director shall identify to agencies a total amount of incremental costs that will be allowed for each agency in issuing new regulations and repealing regulations for the next fiscal year. No regulations exceeding the agency’s total incremental cost allowance will be permitted in that fiscal year, unless required by law or approved in writing by the Director. The total incremental cost allowance may allow an increase or require a reduction in total regulatory cost.
  (e) The Director shall provide the heads of agencies with guidance on the implementation of the requirements in this section.
 
Sec. 4. Definition. For purposes of this order the term ”regulation” or ”rule” means an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or to describe the procedure or practice requirements of an agency, but does not include:
  (a) regulations issued with respect to a military, national security, or foreign affairs function of the United States;
  (b) regulations related to agency organization, management, or personnel; or
  (c) any other category of regulations exempted by the Director.
 
Sec. 5. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect:
  (i) the authority granted by law to an executive department or agency, or the head thereof; or
  (ii) the functions of the Director relating to budgetary, administrative, or legislative proposals.
  (b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
  (c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.               
               
(Presidential Sig.)
THE WHITE HOUSE,
January 30, 2017.

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OGSOTHER GOVERNMENT SOURCES

OGS_a12. Ex/Im Items Scheduled for Publication in Future Federal Register Editions

(Source:
Federal Register)
 
[No items of interest noted today.]

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OGS_a02
3. Commerce/BIS: (No new postings.)

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

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OGS_a3
5. State/DDTC Posts Name Change of Night Vision Depot

(Source:
State/DDTC) [Excerpts.]
 
Effective immediately, Night Vision Depot, Inc. will change as follows: Night Vision Devices, Inc. Due to the volume of authorizations requiring amendments to reflect this change, the Deputy Assistant Secretary for Defense Trade Controls is exercising the authority under 22 CFR 126.3 to waive the requirement for amendments to change currently approved license authorizations. The amendment waiver does not apply to approved or pending agreements. … 

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

OFAC has issued a Finding of Violation to B Whale Corporation (BWC), a company based in Taipei, Taiwan and a member of the TMT Group of shipping companies (TMT), for a violation of the Iranian Transactions and Sanctions Regulations, 31 C.F.R. part 560 (ITSR). Between on or about August 30, 2013 and on or about September 2, 2013, BWC violated §§ 560.201 and 560.211 of the ITSR when its vessel, the M/V B Whale, conducted a ship-to-ship transfer with, and received 2,086,486 barrels of condensate crude oil from, the vessel M/T Nainital, a vessel owned by the National Iranian Tanker Company and identified on OFAC’s List of Specially Designated Nationals and Blocked Persons (the “SDN List”) at the time the transaction occurred.
 
The transactions described above occurred after BWC entered into bankruptcy proceedings in the U.S. Bankruptcy Court for the Southern District of Texas on June 20, 2013. OFAC determined that BWC was a U.S. person within the scope of the ITSR because it was present in the United States for the bankruptcy proceedings when the transaction occurred. Additionally, the vessel M/V B Whale was subject to U.S. sanctions regulations because it was property under the jurisdiction of a U.S. bankruptcy court, and therefore the oil transferred to the vessel was an importation from Iran to the United States as defined in the ITSR.
 
The determination to issue a Finding of Violation to BWC in connection with the above transaction reflects OFAC’s consideration of the following facts and circumstances, pursuant to the General Factors under OFAC’s Economic Sanctions Enforcement Guidelines, 31 C.F.R. part 501, app. A. OFAC considered the following to be aggravating factors:
 
  (1) BWC demonstrated reckless disregard for U.S. sanctions requirements while the company and its vessel were subject to U.S. jurisdiction;
  (2) BWC took steps to conceal a ship-to-ship transfer of Iranian oil with an Iranian vessel on the SDN List, including by leaving ship logs blank and switching off the vessel’s automatic identification system during the time period corresponding with the ship-to- ship transfer;
  (3) BWC knew or should have known that this transaction involved Iranian-origin oil and an Iranian vessel on the SDN List; and
  (4) this transaction provided a significant benefit to Iran because it allowed condensate crude oil from an Iranian vessel identified on the SDN List to be transported to a market in a manner that concealed its origin.
 
OFAC considered the following to be mitigating factors:
 
  (1) BWC has not been the subject of a penalty notice or Finding of Violation from OFAC in the five years preceding the transaction constituting the violation; and
  (2) all of BWC’s assets appear to have been liquidated in bankruptcy.
 

 
For more information regarding OFAC regulations, please go to: www.treasury.gov/ofac. 
* * * * * * * * * * * * * * * * * * * *

OGS_a5
7. UK/DIT ECO Posts Overview of Revoked Versions of Sixteen Open General Export Licenses

(Source:
UK/DIT ECO)   
 
The UK/DIT (previously UK/BIS) Export Control Organisation (ECO) has posted an overview of revoked versions of sixteen (16) different open general export licenses (OGELs).
 
Versions of the following OGELs are revoked:

 
The complete overview is available at
here.

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NWSNEWS

NWS_a18.

Reuters: “Trump Administration Tightens Iran Sanctions, Warns of More Measures”

 
The Trump administration on Friday imposed sanctions on 25 individuals and entities, ratcheting up pressure on Iran in what it said were just “initial steps” days after it had put Tehran “on notice” over a recent ballistic missile test-launch.
 
  “Iran has a choice to make. We are going to continue to respond to their behavior in an ongoing way, at an appropriate level to continue to pressure them to change their behavior,” a senior administration official told reporters.
 
  “These are just initial steps in response to Iranian provocative behavior,” the official said on a conference call, suggesting more could follow if Tehran does not curb its ballistic missile program and continues support in regional proxy conflicts. The administration was “undertaking a larger strategic review” of how it responds to Iran.
 
Those affected by the sanctions cannot access the U.S. financial system or deal with U.S. companies and are subject to “secondary sanctions,” meaning foreign companies and individuals are prohibited from dealing with them or risk being blacklisted by the United States.
 
The White House said that while the sanctions, the first actions against Iran by the U.S. government since President Donald Trump took office, were a reaction to recent events, they had been under consideration before.
 
Though the measures are similar to actions taken by the Obama administration targeting Iran’s ballistic missile network and the elite Islamic Revolutionary Guard Corps, the White House said they were just opening shots in plans to go after Iran and that a landmark 2015 deal to curb Iran’s nuclear program was not in the best interest of the United States.
 
Iranian Foreign Minister Mohammad Javad Zarif tweeted on Friday ahead of the announcement: “Iran unmoved by threats as we derive security from our people. We will never initiate war, but we can only rely on our own means of defense”.
 
The new designations stuck to areas that remain under sanctions even with the 2015 nuclear deal sealed between Iran and world powers in place, such as the Revolutionary Guards, an elite military body that is powerful in Iranian politics and the economy, and Iran’s ballistic missile program. Zarif led Iran’s delegation at the nuclear negotiations in 2015.
 
The new sanctions’ impact will be more symbolic than practical, especially as they do not affect the lifting of broader U.S. and international sanctions that took place under the nuclear deal.
 
Also, few of the Iranian entities being targeted are likely to have U.S. assets that can be frozen, and U.S. companies, with few exceptions, are barred from doing business with Iran.
 
Meanwhile, the U.S. moved a Navy destroyer, the USS Cole, close to the Bab al-Mandab Strait off the coast of Yemen to protect waterways from Houthi militia aligned with Iran.
 
Designations
 
German Foreign Minister Sigmar Gabriel on Friday expressed understanding over the sanctions, saying Iran’s missile test last Sunday was a clear violation of U.N. Security Council resolutions.
 
However, Gabriel warned against conflating Sunday’s test with the nuclear deal. The White House said the sanctions made clear the nuclear deal was not in Washington’s best interest.
 
U.S. Senator John McCain welcomed Trump’s decision, saying “for too long, a myopic focus on the Iran nuclear deal blinded the United States to Iran’s persistent campaign to destabilize the Middle East and undermine America’s national security interests”.
 
The U.S. Treasury, which listed the individuals and entities affected on its website, said the sanctions were “fully consistent” with U.S. commitments under the nuclear deal.
 
Some of the entities involved are based in the United Arab Emirates, Lebanon and China.
 
Among those affected were companies, individuals and brokers the U.S. Treasury said support a trade network run by Iranian businessman Abdollah Asgharzadeh.
 
Treasury said he supported Shahid Hemmat Industrial Group, which the United States has said is a subsidiary of an Iranian entity that runs Iran’s ballistic missile program.
 
Treasury also imposed sanctions on what it said was a Lebanon-based network run by the Revolutionary Guard Corps.
 
Hasan Dehghan Ebrahimi, a Beirut-based official with the Revolutionary Guard’s Qods Force, which runs its operations abroad, was put under sanctions for acting on behalf of the Qods Force, Treasury said.
 
Three Lebanese companies involved in waste collection, pharmaceuticals, and construction were also listed under the sanctions for being owned or controlled by Muhammad Abd-al-Amir Farhat, one of Ebrahimi’s employees.
 
Treasury said he has facilitated millions of dollars in cash transfers to Lebanese militant group Hezbollah. Two of his employees and a company he manages were also sanctioned. Treasury said Ebrahimi and his employees used a Lebanon-based network to transfer funds, launder money, and conduct business.

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COMMCOMMENTARY

COMM_a1
9A. Hayer: “Canada: Trump’s NAFTA Pledge Threatens U.S. Expats In Canada”

(Source:
Moodys Gartner)
 
* Author: Amandeep Hayer, Esq. of Moodys Gartner Tax Law LLP, 403-693-5127,
ahayer@moodysgartner.com
 
Donald Trump infamously called the North American Free Trade Agreement (NAFTA) “the single worst trade deal ever approved by [the United States]” and vowed to withdraw from the deal once elected. [FN/1] This policy was such a core plank of his platform that as soon as it become abundantly clear that Trump would win the U.S. election, the value of Mexican Peso relative to U.S. dollar dropped precipitously under the expectation that the U.S. would likely withdraw from NAFTA. [FN/2]
 
Since then, much has been written about the potential economic fallout caused by Trumps pledge. However, little has been written about what might happen to Americans who are working in Canada.
 
The NAFTA Work Permit
 
Like most trade deals, NAFTA has a labor mobility provision which allows for the free flow of labor across borders. While this is nowhere near as generous as the European labor mobility rules, it has massively simplified the ability for Americans to work in Canada. [FN/3]
The NAFTA Work Permit has allowed qualifying professionals (accountants, lawyers, doctors, teachers, nurses, and scientists) to easily work in Canada without going through Canada’s usually cumbersome Foreign Worker Program (FWP). Normally, under the FWP, an employer must do a Labor Market Impact Assessment (LMIA) and advertise for several months before they may extend a job offer to a non-Canadian. Under NAFTA, an employer can extend a job offer to an American and that American would then qualify for a NAFTA Work Permit. This NAFTA Work Permit gives Americans nearly the same level of access to the labor market as your typical Canadian.
 
If the U.S. Pulls Out of NAFTA, What Happens?
 
It is not clear what would happen to American workers who are in Canada on NAFTA Work Permit if the U.S. were to pull out of NAFTA.
 
One possibility is that the Canadian government automatically transfers everyone to a Work Permit under the old Free Trade Agreement (FTA) between Canada and the United States. FTA contains labor mobility provisions which, on the whole, are virtually identical to NAFTA, but this is not a guarantee. For one, although the FTA was never repealed, it was only suspended, it’s not clear what steps will have to be taken to revive it. Would it automatically come back into force once the U.S. pulls out of NAFTA, or would it require additional steps from the U.S. and Canadian governments?
 
It is also not clear whether or not President Trump has any interest in maintaining the FTA. There are plenty of Americans who blame Canada (as much as Mexico) for unfair trade practices and the decline of manufacturing. It is not inconceivable that under a Trump Presidency the U.S. would pull out of NAFTA and the FTA, thus closing one possible avenue of relief for Americans in Canada on a NAFTA Work Permit.
 
Considering past practices, we might not know what President Trump’s plans are until his 3 a.m. tweet announcing a withdrawal from NAFTA.
 
Could the Canadian Government Provide Relief?
 
The Government of Canada has not provided any indication as to what it would do in the event that the U.S. pulls out of NAFTA. Beyond stating that they would be open to negotiations, the Canadian government has given no indication about how it might react.
 
Parliament certainly has the power to enact a special transitional visa for Americans already in Canada. But anything permanent raises constitutional issues. Without a trade deal, it would be incredibly difficult for the Canadian government to legally enact a preferential visa for just American citizens as it is unconstitutional to give preferential treatment based on nationality.
 
Thus, from our initial assessment, the hands of the Canadian government could be effectively tied from providing relief.
 
What Should Americans on a NAFTA Work Permit Do?
 
The worst decision a NAFTA Work Permit holder can make is to simply wait and see what might happen. It’s better to take steps under the existing immigration laws and regulations while you have options.
 
The best option is to apply under the Express Entry Program (EE Program) for Permanent Residency. To qualify, a foreign national must reach a minimum points threshold, the threshold varies based on the applicant pool with the most recent threshold requiring at least 459 points. [FN/4]
 
Under the revised rules and regulations of the EE Program, issued in November of 2015, American citizens on a NAFTA Work Permit can receive an additional 50 or 200 points if they are applying for Permanent Residency under the EE Program. These bonus points give Americans an edge when applying for Permanent Residency under the EE Program.
 
Once a foreign national is granted Permanent Residency, it can be withdrawn only if the foreign national commits certain crimes or is absent from Canada for an extended period of time. Therefore, if the U.S. pulls out of NAFTA, an American with Permanent Residency is no longer at risk of losing his or her legal status in Canada.
 
Rather than waiting for the 3 a.m. tweet, Americans on a NAFTA Work Permit should quickly apply under the EE Program and secure their place in Canada.
 
——–
  [FN/1]
Link.
  [FN/2]
Link.
  [FN/3] The free movement of workers, is one of the four fundamental economic freedoms of the European Union. It allows a person to seek employment or to settle anywhere in any European Union without a visa. 45 TFEU,
Link.
  [FN/4] EE Program Draw on January 11, 2017

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COMM_a2
10W.H. Maruyama, R.D. Kyle & B. Peters: “President Trump Will Have Broad Presidential Authority to Terminate Trade Agreements and Impose Punitive Duties on U.S. Trading Partners”

(Source:
Hogan Lovells)
 
* Authors: Warren H. Maruyama, Esq.,
warren.maruyama@hoganlovells.com, 202-637-5716; Robert D. Kyle, Esq.,
robert.kyle@hoganlovells.com, 202-637-5494; B. Peters, Esq.
beth.peters@hoganlovells.com, 202-637-5837. All of Hogan Lovells Washington D.C.
 
Executive Summary
 
During his Presidential campaign, Donald Trump challenged longstanding U.S. trade policy with promises to terminate or renegotiate the North American Free Trade Agreement (NAFTA), impose 45 percent tariffs on imports from China, and impose 35 percent tariffs on imports from U.S. companies that move plants and jobs to Mexico. Moreover, as part of the first 100 days of his new administration, in addition to promising to renegotiate or withdraw from NAFTA, President-elect Trump has also said he will consider withdrawing from the Trans-Pacific Partnership (TPP), designate China a “currency manipulator,” and use “every tool under American and international law” to challenge unfair trading practices that impact American workers.
 
Under U.S. trade law, Congress has granted broad authority to the president to withdraw from trade agreements, impose additional duties on unfair trade practices, and designate currency manipulators. These steps do not require Congressional action or approval, as U.S. trade law vests broad authority in the president, without the checks and balances or legal constraints that exist under other trade procedures. Thus, President Trump would face only limited legal constraints in implementing these campaign promises.
 
In our view, these risks are sufficiently real that companies should assess their potential exposure and consider their response options should these possible risks mature. We have experience working with companies to identify specific risks and to develop response strategies.
 
Background
 
The basic legal authority for U.S. free trade agreements is the Trade Act of 1974 (1974 Act), which authorized the president to negotiate trade agreements dealing with tariff and non-tariff barriers. Importantly, Section 151 of the 1974 Act authorized the president to submit such agreements to Congress for approval under the so-called fast-track/Trade Promotion Authority (TPA) procedures. Subsequent extensions of TPA in the Omnibus Trade Act of 1988, Trade Promotion Authority Act of 2002, and Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (TPA Act of 2015) have extended the fast-track/TPA procedures in Section 151 to permit new agreements.
 
All of the extensions have incorporated key provisions of the 1974 Act, including section 125, which gives the President what is commonly referred to as “termination and withdrawal authority.” Under Section 125(a), every trade agreement entered into by the U.S. must contain a provision allowing the U.S. to withdraw after giving appropriate notice (normally 6 months). Section 125(b) gives the president additional authority to revoke any earlier Presidential proclamations implementing U.S. tariff reductions under the agreement. Paragraph (c) gives the president authority to proclaim higher U.S. tariffs up to a maximum of 50 percent above the rate in column 2 of the U.S. tariff schedule on January 1, 1975, or 20 percent above the rate in effect for that country on January 1, 1975. Finally, Section 125(e) provides that existing U.S. tariff levels normally should remain in effect for one year after termination of an agreement. Paragraph (e) reflects concern on the part of the Congress about the potentially disruptive economic effects of sudden and precipitous tariff increases, and gives traders and markets time to adjust. However, in special circumstances, the president can impose higher U.S. tariffs in less than one year after notifying the Congress and holding a public hearing, and if there is a need for truly expeditious action, the president can move without a hearing as long as a public hearing is held promptly after such action.
 
The termination and withdrawal provisions of the 1974 Act apply to NAFTA, the World Trade Organization (WTO) and other U.S. trade agreements. NAFTA was negotiated under a grant of fast-track/TPA authority in the Omnibus Trade and Tariff Act of 1988 (1988 Act). Section 1105 of the 1988 Act made the termination and withdrawal provisions of Section 125 fully applicable to NAFTA.
 
As a result, the president has authority to unilaterally terminate NAFTA if he or she so desires. This would require 6 months’ notice under NAFTA Article 2205, which allows a party to withdraw six months after providing written notice of withdrawal to the other parties. Thus, if the president (1) gives 6 months’ notice under NAFTA Article 2205 to Mexico and/or Canada, (2) terminates the free trade agreement, and (3) issues a proclamation under Sections 125(b) and 125(c) revoking U.S. NAFTA tariff concessions and imposing higher tariffs on imports from Mexico and/or Canada, U.S. tariffs would then increase up to 20 percent above their rates in effect on January 1, 1975 after a transition period of 6 months to a year. The same authority applies to U.S. Membership in the WTO and other U.S. free trade agreements.
 
The president also has broad authority under U.S. trade law to unilaterally impose punitive U.S. tariffs. Section 125 of the Trade Act of 1974 give the president authority to raise U.S. duties after terminating NAFTA or other trade agreements. However, because these increases are capped at 20-50 percent higher than the rates previously in effect on January 1, 1974, Section 125 would lead to only modest increases for many products.
 
Accordingly, a president who is determined to impose punitive tariffs on Mexico or China is likely to turn to other sources of legal authority, including:
 
  – Section 301/Unfair Trade Practices – Section 301 of the Trade Act of 1974 gives the United States Trade Representative (USTR), at the direction of the president, broad authority to respond to unfair trade practices, such as violations of trade agreements, or to “an act, policy, or practice of a foreign country that is unreasonable or discriminatory and burdens or restricts U.S. commerce.” If a president directs the USTR to impose higher tariffs on a trade partner, e.g. 45 percent tariffs on imports from China or 35 percent tariffs on some products from Mexico, USTR has authority to do so. While USTR has interpreted Section 301(a) to require it to take potential trade agreement violations to the WTO, and has been very reluctant to use Section 301(b) to challenge “unreasonable” practices that are not covered by WTO rules, there is nothing to stop it from doing so and acting more aggressively if it chooses to do so.
 
  – Section 122/Balance-of-Payments – Section 122 of the Trade Act of 1974 authorizes the president to deal with “large and serious United States balance-of-payments deficits” by imposing temporary import surcharges not to exceed 15 percent ad valorem on imported goods, temporary quotas, or some combination of both. This 15 percent surcharge would be on top of any existing U.S. duties. One disadvantage is that the duties can only remain in effect 150 days, unless this period is extended by an Act of Congress.
 
  – Section 232(b)/National Security – Section 232(b) of the Trade Expansion Act of 1962 authorizes the Secretary of Commerce to investigate whether imports pose a threat to U.S. national security. Based on the Secretary’s report, the president is authorized to negotiate agreements to limit or restrict imports, or to “take such other actions as the president deems necessary to adjust the imports of such article so that such imports will not threaten to impair the national security.”
 
  – IEEPA/International Economic Emergencies – Finally, the International Emergency Economic Powers Act (IEEPA) gives the president broad authority to deal with any “unusual and extraordinary threat, which has its source in whole or in substantial part outside the United States, to the national security, foreign policy, or economy of the United States.” Although the president must consult with the Congress, submit a report, and provide periodic follow-up reports, IEEPA does not require Congressional approval. These measures can last indefinitely. The United States has maintained its system of export controls for several decades under IEEPA, because of Congress’ inability to agree on new export control authorization legislation.
 
Implications/Conclusion
 
While President Trump will have legal authority to implement his campaign promises on trade, such a step is unlikely to be cost-free. If the U.S. imposes punitive duties on China and Mexico, it is quite possible that one or both will retaliate with equivalent tariffs on U.S. goods. Chinese and Mexican trade negotiators are as sophisticated as they come and know the trade game as well as anyone. Within 48 hours after president Obama announced he was imposing new duties on imports of Chinese tires under Section 421 of U.S. trade law, Beijing initiated antidumping investigations of U.S. cars and poultry in retaliation. While the U.S. tire duties were lifted long ago, U.S. poultry is still largely shut out of the Chinese market. In 2009, after Congress restricted the entry of Mexican trucks in violation of U.S. NAFTA commitments, Mexico imposed US$2 billion of additional duties on U.S. exports, carefully targeting U.S. products of interest to key Members of Congress and leading proponents of the trucking ban. Congress quietly repealed the trucking ban two years later.
 
In sum, the president has broad authority under U.S. trade law to terminate existing U.S. free trade agreements and impose higher tariffs on certain U.S. trading partners. While this step could trigger a costly trade war, it is fully permitted by U.S. law and does not require Congressional approval.

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TEEX/IM TRAINING EVENTS & CONFERENCES

TE_a211
. Friday List of Approaching Events

(Sources: Event sponsors.) 
 
Published every Friday or last publication day of the week. Send events to
apbosch@fullcirclecompliance.eu
, composed in the below format:

* DATE: PLACE; “TITLE;” SPONSOR; WEBLINK; CONTACT (email and phone number)
 
Continuously Available Training:
* Executive Masters: “
International Trade Compliance
;” University of Liverpool;
exed@liverpool.ac.uk
;
+44 (0) 20 768 24614
* E-Seminars: “
US Export Controls” / “Defense Trade Controls
;” Export Compliance Training Institute;
danielle@learnexportcompliance.com 
* On-Line: “
Simplified Network Application Process Redesign (SNAP-R)
;” Commerce/BIS; 202-482-2227
* E-Seminars: “
Webinars On-Demand Library
;” Sandler, Travis & Rosenberg, P.A.
 
Training by Date:

* Feb 6: Manchester UK; “
Nuclear Course
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Feb 7: Webinar; “
Tariff Engineering to Legally Reduce or Eliminate Duty
;”
Sandler, Travis & Rosenberg, P.A.;
webinarorganizers@strtrade.com

* Feb 8-9: Wash DC; “7th Annual Advanced ITAR & EAR Compliance;” marcus evans

* Feb 8: Webinar; “
CBP Audit Surveys: What’s at Stake?
;”
Sandler, Travis & Rosenberg, P.A.;
webinarorganizers@strtrade.com

* Feb 10: Melbourne FL; “Accelerated Advanced Export Compliance Workshop;” Space Coast World Trade Council;
bcantillon@bellsouth.net
, 321-373-2047

* Feb 13-15: Las Vegas NV; “
Basics of Government Contracting
;” Federal Publications Seminars

* Feb 15: Webinar; “
Identifying Agents for Customs Purposes – Traps for the Unwary Importer
;”
Sandler, Travis & Rosenberg, P.A.;
webinarorganizers@strtrade.com

* Feb 16: Webinar; “
The Fundamentals of Product Classification
;” ECTI;
danielle@learnexportcompliance.com
; 540-433-3977
* Feb 21: Webinar; “GTM Webinar Series Part One: Restricted Party Screening;” Amber Road

* Feb 20-23: Orlando; “
United States Export Control (EAR/OFAC/ITAR) Seminar
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977

* Feb 20; San Diego; “
AES Compliance Seminar in Spanish
;”Dept. of Commerce/Census Bureau;
itmd.outreach@census.gov 

* Feb 21: San Diego CA; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Feb 21-22: Santa Clara CA; “
12th Annual Export Control Forum: A Compliance Symposium
;” Dept. of Commerce/Bureau of Industry and Security, and Professional Association of Exporters and Importers


* Feb 22: Newcastle UK; “
Intermediate Seminar
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* Feb 22: Southfield MI; “Harmonized Tariff Schedule – Classifications;” Sandler, Travis & Rosenberg, P.A.; imeyer@sttas.com
* Feb 23: Long Beach CA; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Feb 23: Newcastle UK; “
Beginners Workshop
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Feb 23: Newcastle UK; “
Making Better License Applications
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Feb 23: Newcastle UK; “
Control List Classification – Combined Dual Use and Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
*
Feb 27-Apr 3: Santa Ana CA; “
Import Compliance Training Program (Mondays 8am-11am)
;” California Global Trade Logistics Initiative, Orange County Center for International Trade
Development

* Mar 5-6: Dubai UAE; “Trade Compliance in the Middle East;” C5

* Mar 6-8: San Diego CA; “
Basics of Government Contracting
;” Federal Publications Seminars

* Mar 7-10: Orlando; “
‘Partnering for Compliance™’ East Export/Import Control Training and Education Program
;” Partnering for Compliance East;
Ailish@PartneringForCompliance.org
; 321-952-2978 

* Mar 8: London UK; “
Control List Classification – Combined Dual Use and Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* Mar 8: Webinar; “
GTM Webinar Series Part Two: Product Classification;” Amber Road

* Mar 9: London UK; “
Making Better License Applications
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* Mar 12-15: Miami; “ICPA Miami Conference;”

International Compliance Professionals Association;
wizard@icpainc.org 

* Mar 13-15: Newport Beach CA; “2017 Winter Back to Basics Conference;” Society for International Affairs

* Mar 15: Birmingham UK; “
Intermediate Seminar
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* Mar 15: Miami FL; “AES Compliance Seminar in Spanish;” Dept. of Commerce/Census

* Mar 16: Miami FL; “AES Compliance Seminar;” Dept. of Commerce/Census
* Mar 16: Birmingham UK; “
Beginners Workshop
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Mar 16: Birmingham UK; “
Making Better License Applications
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Mar 16: Birmingham UK; “
Control List Classification – Combined Dual Use and Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* Mar 17: Chicago IL; “
Customs Education & Solutions Seminar
;” AAEI; Chris Enyart,
cenyart@aaei.org
, +1-202-857-8009

* Mar 20-22: Orlando FL; “
Basics of Government Contracting
;” Federal Publications Seminars

* Mar 20-23: Singapore; “United States Export Control (EAR/OFAC/ITAR) (for Asia-Pacific and other non-US Companies);” ECTI; jessica@learnexportcompliance.com; 540-433-3977

* Mar 20: Webinar; “
GTM Webinar Series Part Three: License Determination;” Amber Road

* Mar 21: Webinar; “
Importer Self-Assessment – What It Really Takes
;”
Sandler, Travis & Rosenberg, P.A.;
webinarorganizers@strtrade.com

* Mar 22: Detroit MI; “AES Compliance Seminar;” Dept. of Commerce/Census itmd.outreach@census.gov 

* Mar 29: London UK; “
Control List Classification – Combined Dual Use and Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
*  Mar 29-30: Phoenix/Scottsdale AZ; “Critical Compliance & TAA Workshop;” spalmer@exportcompliancesolutions.com; 866-238-4018 / 410-757-1919
* Apr 3-5: Sterling VA; “
Basics of Government Contracting
;” Federal Publications Seminars

* Apr 3-6: Wash DC; “
EAR/OFAC/ITAR Commercial and Military Export Controls/How US Controls Impact Non-US Companies, Affiliates and Transactions, PLUS Other Country Controls Comparison to US (EU & Canada) Seminar
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977


* Apr 4: Webinar; “
GTM Webinar Series Part Four: Supply Chain Collaboration;” Amber Road
* Apr 11: Webinar; “
GTM Webinar Series Part Five: Free Trade Agreements;” Amber Road

* Apr 18: Milwaukee WI; “AES Compliance Seminar;” Dept. of Commerce/Census itmd.outreach@census.gov 

* Apr 26: London UK; “
Intermediate Seminar
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Apr 27: London UK; “
Beginners Workshop
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Apr 27: London UK; “
Making Better License Applications
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* May 1-4: Las Vegas; “
EAR Export Controls / ITAR Defense Trade Controls Seminar
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977


* May 1-2: Tucson AZ; “2017 Spring Conference;” Society for International Affairs

* May 7-9: Toronto; “ICPA Toronto Conference;”
International Compliance Professionals Association;
wizard@icpainc.org 

* May 8-10: San Diego CA; “
Basics of Government Contracting
;” Federal Publications Seminars

* May 10: London UK; “
Control List Classification – Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* May 10: Wash DC; “
AES Compliance Seminar
;” Dept. of Commerce/Census Bureau;
itmd.outreach@census.gov 

* May 11: London UK; “

Making Better License Applications
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* May 15-18: London UK; “
United States Export Control (EAR/OFAC/ITAR) Seminar in London (for EU and other non-US Companies)
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977

* May 17-19: Minneapolis MN; “
Basics of Government Contracting
;” Federal Publications Seminars

* May 17: Southampton UK; “
Intermediate Seminar
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* May 18: Southampton UK; “
Beginners Workshop
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 

* May 23: Tampa FL; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Jun 5-7: Boston MA; “
Basics of Government Contracting
;” Federal Publications Seminars

* Jun 5-8: Wash DC; “
United States Export Control (EAR/OFAC/ITAR) Seminar
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977

* Jun 7: London UK; “
Control List Classification – Combined Dual Use and Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Jul 10-12; Baltimore MD; “
2017 Summer Back to Basics Conference
;” Society for International Affairs

* Jun 11-13: Dublin IRL; “ICPA Dublin Conference;”

International Compliance Professionals Association;
wizard@icpainc.org 

* Jun 12-15: San Francisco; “
United States Export Control (EAR/OFAC/ITAR) Seminar
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977

* Jun 13: Philadelphia PA; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 
* Jun 14: Kegsworth, Derby UK; “
Intermediate Seminar
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Jun 15: Kegsworth, Derby UK; “
Beginners Workshop
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Jun 15: Kegsworth, Derby UK; “
Making Better License Applications
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* Jun 15: Kegsworth, Derby UK; “
Control List Classification – Combined Dual Use and Military
;” UK/BIS Export Control Organisation;
denise.carter@bis.gsi.gov.uk 
* July 11-12: Seattle WA; “ITAR/EAR Boot Camp;” spalmer@exportcompliancesolutions.com; 866-238-4018 / 410-757-1919
* Jul 17-19: Hilton Head Island SC; “
Basics of Government Contracting
;” Federal Publications Seminars
* Aug 14-16: McLean VA; “
Basics of Government Contracting
;” Federal Publications Seminars

* Sep 4-9: Galveston TX; “ICPA Conference at Sea;”

International Compliance Professionals Association;
wizard@icpainc.org

* Sep 6: Nashville TN; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Sep 12-13: Annapolis MD; “ITAR/EAR Boot Camp;” spalmer@exportcompliancesolutions.com; 866-238-4018 / 410-757-1919

* Sep 12-13: Wash DC; “Interactive Export Controls Workshop;” ECTI; jessica@learnexportcompliance.com; 540-433-3977

* Sep 18-20: Las Vegas NV; “
Basics of Government Contracting
;” Federal Publications Seminars

* Oct 2-5: Columbus OH; “University Export Controls Seminar;” ECTI; jessica@learnexportcompliance.com; 540-433-3977

* Oct 12: Boston MA; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Oct 23-24: Arlington VA; “
2017 Fall Advanced Conference
;” Society for International Affairs
* Nov 6-8: Chicago IL; “
Basics of Government Contracting
;” Federal Publications Seminars

* Nov 7: Norfolk, VA; “AES Compliance Seminar;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Dec 5: San Juan PR; “AES Compliance Seminar in Spanish;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 
* Dec 7: Laredo, TX; “AES Compliance Seminar in Spanish;” Dept. of Commerce/Census Bureau; itmd.outreach@census.gov 

* Dec 11-13: Sterling VA; “
Basics of Government Contracting
;” Federal Publications Seminars


* Dec 12: Jersey City NJ; “
AES Compliance Seminar
;” Dept. of Commerce/Census Bureau;
itmd.outreach@census.gov 

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

ENEDITOR’S NOTES

EN_a112. Bartlett’s Unfamiliar Quotations

(Source: Editor) 

* Knute Rockne (Knute Kenneth Rockne, 4 Mar 1888 – 31 Mar 1931, was a Norwegian-American football player and coach at the University of Notre Dame, and is regarded as one of the greatest coaches in college football history.)
  – “Drink the first. Sip the second slowly. Skip the third.”
 
* Horace Greeley (5 Feb 1811 – 29 Nov 1872, was founder and editor of the New-York Tribune, among the great newspapers of its time.  Greeley popularized the phrase “Go West, young man, and grow up with the country,” although it was first stated by John Babsone Lane Soule in an 1851 editorial in the Terre Haute Express.)
  – “Always rise from the table with an appetite, and you will never sit down without one.”


Friday funnies:

A young boy was looking up at the wall of memorial plaques in the entrance to the church. The minister came up and asked the boy what he was thinking.  The young boy asked, “What are all these names for?”  The minister replied that the plaques were to honor those who had in the service.   After thinking for a minute, the boy asked, “Was it in the 9 o’clock service or the 11 o’clock service?”
 

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

EN_a213. 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: 27 Jan 2017: 82 FR 8589-8590: Delay of Effective Date for Importations of Certain Vehicles and Engines Subject to Federal Antipollution Emission Standards; and 82 FR 8590: Delay of Effective Date for Toxic Substance Control Act Chemical Substance Import Certification Process Revisions

* 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: Last Amendment: 1 Feb 2017: 82 FR 8893-8894: Commerce Control List: Removal of Certain Nuclear Nonproliferation (NP) Column 2 Controls 

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
  – Last Amendment: 17 Jan 2017: 82 FR 4793-4794: Sudanese 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 (15 Nov 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.  Please contact us to receive your discount code. 
 
*
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: 11 Jan 2017: 82 FR 3168-3170: 2017 Civil Monetary Penalties Inflationary Adjustment
  – The only available fully updated copy (latest edition 24 Jan 2017) 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, 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 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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