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17-0302 Thursday “The Daily Bugle”

17-0302 Thursday “The Daily Bugle”

Thursday, 2 March 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 
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[No items of interest noted today.]

  1. Ex/Im Items Scheduled for Publication in Future Federal Register Editions
  2. Commerce/BIS: (No new postings.) 
  3. DHS/CBP Posts Updated ACE Cargo Release CATAIR Chapter 
  4. President Publishes 2017 Trade Policy Agenda and 2016 Annual Report
  5. State/DDTC Posts Name Change for Alsalam Aircraft Company
  1. Expeditors News: “European Union Preferential Trade Agreements” 
  2. Reuters: “Exclusive: China’s ZTE Expected to Plead Guilty over Iran Sales – Source” 
  3. The Salt Lake Tribune: “Man Put on Probation for Trying to Export Rifles to Belarus” 
  1. L. Torres: “Import Violations: What You Need to Know About 9 USC 1592” 
  2. M. Volkov: “DOJ’s Compliance Program Evaluation: the Role of the CCO (Part II of IV)” 
  3. R.C. Burns: “Assassination In Malaysia Leads To Calls to Redesignate DPRK As A Terrorist State” 
  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 (24 Feb 2017), FACR/OFAC (10 Feb 2017), FTR (15 May 2015), HTSUS (10 Feb 2017), ITAR (11 Jan 2017) 

EXIMEX/IM ITEMS FROM TODAY’S FEDERAL REGISTER

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OGS
OTHER GOVERNMENT SOURCES

OGS_a11. Ex/Im Items Scheduled for Publication in Future Federal Register Editions

(Source: Federal Register)

* Treasury; Foreign Assets Control Office; NOTICES; Blocking or Unblocking of Persons and Properties [Publication Date: 3 March 2017.]  
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OGS_a22. Commerce/BIS: (No new postings.)

(Source:
Commerce/BIS)

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(Source:
CSMS# 17-000116, 2 Mar 2017.)
 
On February 23, 2017, CBP posted an updated ACE Cargo Release CATAIR (v. 19) to reflect current ACE Cargo Release functionality. This CATAIR update also includes a new validation, effective March 23, 2017, that requires the transmission of the port code (SE10 record) for cancellation requests.
 
To download a copy of the updated ACE Cargo Release CATAIR Chapter, please visit the “ACE ABI CATAIR” page of CBP.gov/ACE.
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THE TRADE POLICY OBJECTIVES AND PRIORITIES OF THE UNITED STATES FOR 2017, AND REASONS THEREFOR
 
Key Principles and Objectives of the Trump Administration’s Trade Policy
 
In 2016, voters in both major parties called for a fundamental change in direction of U.S. trade policy. The American people grew frustrated with our prior trade policy not because they have ceased to believe in free trade and open markets, but because they did not all see clear benefits from international trade agreements. President Trump has called for a new approach, and the Trump Administration will deliver on that promise.
 
The overarching purpose of our trade policy – the guiding principle behind all of our actions in this key area – will be to expand trade in a way that is freer and fairer for all Americans. Every action we take with respect to trade will be designed to increase our economic growth, promote job creation in the United States, promote reciprocity with our trading partners, strengthen our manufacturing base and our ability to defend ourselves, and expand our agricultural and services industry exports. As a general matter, we believe that these goals can be best accomplished by focusing on bilateral negotiations rather than multilateral negotiations – and by renegotiating and revising trade agreements when our goals are not being met. Finally, we reject the notion that the United States should, for putative geopolitical advantage, turn a blind eye to unfair trade practices that disadvantage American workers, farmers, ranchers, and businesses in global markets.
 
In addition to these basic principles, we will focus on the following key objectives:
 
  – Ensuring that U.S. workers and businesses have a fair opportunity to compete for business – both in the domestic U.S. market and in other key markets around the world;
  – Breaking down unfair trade barriers in other markets that block U.S. exports, including exports of agricultural goods;
  – Maintaining a balanced policy that looks out for the interests of all segments of the U.S. economy, including manufacturing, agriculture, and services, as well as small businesses and entrepreneurs;
  – Ensuring that U.S. owners of intellectual property (IP) have a full and fair opportunity to use and profit from their IP;
  – Strictly enforcing U.S. trade laws to prevent
the U.S. market from being distorted by dumped and/or subsidized imports that harm domestic industries and workers;
  – Enforcing labor provisions in existing agreements and enforcing the prohibition against the importation and sale of goods made with forced labor;
  – Resisting efforts by other countries -or Members of international bodies like the World Trade Organization (WTO) –
to advance interpretations that would weaken the rights and benefits of, or increase the obligations under, the various trade agreements to which the United States is a party;
  – Updating current trade agreements as necessary to reflect changing times and market conditions;
  – Ensuring that United States trade policy contributes to the economic strength and manufacturing base necessary to maintain – and improve -our national security; and 
  – Strongly advocating for all U.S. workers, farmers, ranchers, services providers, and businesses, large and small -to assure the fairest possible treatment of American interests in the U.S. market and in other markets around the world.
 
Top Priorities and Reasons Therefor
 
To achieve the objectives described above, the Trump Administration has identified four major priorities:
 
  (1) defend U.S. national sovereignty over trade policy;
  (2) strictly enforce U.S. trade laws;
  (3) use all possible sources of leverage to encourage other countries to open their markets to U.S. exports of goods and services, and provide adequate and effective protection and enforcement of U.S. intellectual property rights; and
  (4) negotiate new and better trade deals with countries in key markets around the world.
 
Each of these priorities – and the reasons they are so important – are discussed in greater detail below. …

[Editor’s Note: The entire document can be found here.] 

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OGS_a5
5
. State/DDTC Posts Name Change for Alsalam Aircraft Company

(Source:
State/DDTC) [Excerpts.]
 
Effective immediately, Alsalam Aircraft Company will change as follows: Alsalam Aerospace Industries Company, Ltd. 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. …  

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COMMNEWS

NWS_a16. Expeditors News: “European Union Preferential Trade Agreements”
(Source: Expeditors News)
 
On February 27, 2017 the United Kingdom Customs Administration (HMRC) updated a document offering guidance on preferential trade agreements for countries outside the European Union.
 
This document contains lists of all countries outside the European Union that benefit from preferential trade agreements with the Union. It also lists the particular preferential trade agreement that could be applicable.
 
The document can be accessed here.
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NWS_a27. Reuters: “Exclusive: China’s ZTE Expected to Plead Guilty over Iran Sales”

(Source: Reuters) [Excerpts.]
 
Chinese telecom equipment maker ZTE Corp is nearing an agreement to plead guilty to U.S. criminal charges and pay hundreds of millions of dollars in penalties over allegations it violated U.S. laws that restrict sale of U.S. technology to Iran, a person familiar with the matter said.
 
The company has not yet signed a deal with the U.S. Department of Commerce, the U.S. Department of Justice and the U.S. Department of Treasury, cautioned the person, who declined to speak on the record because the negotiations are not public.
 
Others noted that with a new U.S. administration prompting changes in personnel at government departments, a final deal may be delayed or even scuttled.
 
But ZTE is expected to plead guilty to conspiring to violate the International Emergency Economic Powers Act, among other charges, the source said, and pay penalties in the hundreds of millions. …
 
An agreement would cap a year of uncertainty for the Shenzhen-based company, which was placed on a list of entities March 2016 that U.S. suppliers could not work with without a license. ZTE acted contrary to U.S. national security or foreign policy interests, the Commerce Department said at the time.
 
One of the world’s biggest telecommunications gear makers and the No. 4 smartphone vendor in the United States, ZTE sells handset devices to U.S. mobile carriers AT&T Inc., T-Mobile US Inc. and Sprint Corp. It relies on U.S. companies including Qualcomm, Microsoft and Intel for components.
 
The listing could have severely disrupted the company’s supply chain, but the Commerce Department granted ZTE a temporary license so U.S. companies could continue to do business with the Chinese firm while it cooperated with the investigation.
 
The temporary license was extended several times, with the latest reprieve expiring on March 29.  
The last extension, a ZTE spokesman told Reuters in an email last week, was “a sign of the progress” made.
 
ZTE was working with the U.S. government “toward permanent removal from the Entity List,” the company spokesman said at that time, and under new leadership was conducting business in a way that “meets and exceeds export compliance standards.” …
 
ZTE said that the outcome remained uncertain, but that it would likely have a material impact on its financials. ZTE has annual sales of more than $15 billion.
 
SCRUTINY CAN MEAN COMFORT
 
The implications of a guilty plea are unclear. Experts said it can result in a denial order, which imposes a complete bar on the receipt of U.S. origin goods and technology. But, as part of a settlement, the order could be suspended for years.
 
Typically, the reputational taint of a guilty plea on U.S. suppliers or customers would be limited in duration, according to Washington attorney Douglas Jacobson, an export controls and sanctions expert.
 
  “In fact, a company that has faced the type of scrutiny that ZTE has … actually gives U.S. suppliers and customers a greater degree of comfort that they will be a compliant company in the future,” said Jacobson, who represents some U.S. suppliers to ZTE.
 
The Commerce Department released alleged internal documents last year, showing senior ZTE executives instructing the company to carry out a project for dodging export controls in Iran, North Korea, Syria, Sudan and Cuba.
 
ZTE replaced the senior executives allegedly involved, including naming a new president, and also appointed a new, U.S.-based chief export compliance officer. The Shenzhen-based company has a U.S. subsidiary in Richardson, Texas. …

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NWS_a38. The Salt Lake Tribune: “Man Put on Probation for Trying to Export Rifles to Belarus”

 
A United Arab Emirates man who admitted he conspired to export sniper rifles from the United States to Belarus has been sentenced by a federal judge in Utah to five years of probation.
 
U.S. District Judge Dee Benson also ordered Kolar Rahman Anees Ur Rahman to forfeit more than $13,000 he sent to an undercover Department of Homeland Security agent as payment for the unlawful shipment of the weapons to the eastern European country.
 
Rahman, 47, was indicted in December 2015 with conspiracy to commit an offense against the United States, violating the Arms Export Control Act, smuggling goods from the United States and money laundering. He pleaded guilty to the four counts and was sentenced Jan. 30.
 
In a written statement, Rahman admitted that while he was living in the United Arab Emirates, he communicated via email and telephone in 2015 with the Salt Lake City-based undercover agent in an attempt to have 10 sniper rifles shipped to Belarus. He also acknowledged that he tried to have the .308-caliber rifles initially shipped to South Africa, knowing their final destination was actually Belarus, and wired $13,357 into the United States.
 
Rahman, who said he was acting as the broker/facilitator for two people in the United Arab Emirates, agreed to travel to the United States to discuss the rifle shipment and future business in person with the undercover agent, according to court documents.
 
He met with two Homeland Security undercover agents at a hotel near Chicago on Nov. 4, 2015, the documents say.
 
The two people in the United Arab Emirates who Rahman said were part of the conspiracy were named as defendants in a superseding indictment issued in June 2016. They have not been arrested yet.

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COMMCOMMENTARY

COMM_a19. L. Torres: “Import Violations: What You Need to Know About 19 USC 1592”
(Source: Torres Law PLLC)
 
* Authors: Luis Torres, Esq., Torres Law PLLC. Contact: 214-593-7120, info@torrestradelaw.com.
 
This article provides an overview of Customs’ statutory penalties for import violations.
 
In 2016, Customs and Border Protection (“CBP” or “Customs”) processed $2.28 trillion in imports, levying 13 monetary penalties totaling over $30.6 million on importers for fraud, gross negligence, and negligence for anti-dumping/countervailing duty (“AD/CVD”) violations. [FN/1] This was largely fueled by The Trade Facilitation and Trade Enforcement Act (TFTEA), (PL 114-125), enacted on February 24, 2016.   TFTEA increased the enforcement power of CBP, a move that will likely also increase trade prosecutions. This more aggressive approach will likely continue in 2017 and, based on President Trump’s campaign promises regarding trade, it looks like CBP will have a busy year ahead.
 
Section 1592 of the Tariff Act of 1930 is the primary customs penalty provision regarding the importation of goods. It is the enforcement tool used by CBP to ensure customs laws concerning the Harmonized Tariff Schedule of the United States (“HTSUS”) classification, valuation, and others are followed when importing into the United States.
 
How does 19 USC § 1592 work?
 
This statute gives authority to CBP to impose penalties for customs laws violations. The statute has different levels of culpability with respect to the penalties that may be imposed including fraud, gross negligence, and negligence. Specifically, § 1592 prohibits the importation or attempt to import merchandise by means of (1) false and material documents or electronic data or (2) material omissions. It also prohibits any person from aiding or abetting any other individual to violate the statute. Importers should be aware that this law is violated even when the government does not lose any duties or other revenue.

It must be noted that the statutory scheme puts primary responsibility on the importer of record, who must demonstrate that it has met its duty of informed compliance and reasonable care.   However, this does not mean all other players in the transaction are immune from liability; the statute is not limited to the importer of record.   Any other party who has participated in the transaction leading to a violation may also be held liable. Just because the importer of record may be a corporation or limited liability company does not preclude it from liability. In some cases, personal liability may attach for certain § 1592 penalties.
 
Fraud, gross negligence, negligence, what is the difference?
 
When assessing penalties, CBP charges the violator with one of three levels of culpability. The amount of penalties assessed against the importer depend on what level of culpability was ultimately assigned to the violator.
 
The regulations establish the following standards:

  (1) Negligence: defined by Customs as the failure to exercise reasonable care;
  (2) Gross Negligence: defined by Customs as “actual knowledge or wanton disregard”; and
  (3) Fraud: defined by Customs as “voluntary and intentionally.”
 
To put it simply, negligence occurs when the importer did not know that its conduct was a violation; gross negligence occurs when the importer did not know there was a falsity and did not care whether it was a violation or not; and fraud occurs when the importer knew or should have known of the falsity.  
 
It is important to note that clerical errors or mistakes of fact are excepted from the statutory penalties. Unless the error or mistake was part of a pattern of negligent conduct, this event would not be considered a violation under the regulations.
 
How does CBP make the penalty determinations?
 
CBP determines whether a penalty is assessed by looking into several different factors. Various mitigating factors may be taken into account and include (1) contributing Customs error, (2) cooperation with the investigation, (3) immediate remedial action, (4) inexperience in importing, (5) prior good record, (6) inability to pay the customs penalty, and (7) customs knowledge. These factors are considered in mitigating the proposed or assessed penalty claim.  
 
If an importer discovers customs violations, it has the option to file a prior disclosure with CBP. A prior disclosure will mitigate any potential penalties for the violations by voluntarily offering an explanation regarding why the violation happened and paying any owed duties. Importantly, prior disclosures must be submitted before CBP begins an investigation into the disclosed matter in order for the disclosure to be considered voluntary and, therefore, a mitigating factor. Importers should proceed with caution and seek legal advice and assistance in preparing and filing the prior disclosure. The filing of a prior disclosure demands a certain set of skills that is often beyond the reach of most nonlawyers.
 
Maximum Civil Penalty Levels-19 USC § 1592(c)
 
Whether or not there has been an actual duty loss can also affect the penalty assessment. For violations with a loss of duty the penalties are:

  – Fraud: the maximum statutory level is the domestic value of the merchandise; under the regulations, the penalty may be five to eight times the duty loss.
  – Gross negligence: the maximum statutory level is the lesser of the domestic value or four times the duty loss; the regulations anticipate two and one-half to four times the duty loss.
  – Negligence: the maximum statutory level is the lesser of the domestic value or two times the duty loss; under the regulations, between one-half and two times the duty loss.  
 
For violations without a loss of duty the penalties are:
 
  – Fraud: the statutory maximum is the domestic value; under the regulations, the penalty is 50 percent to 80 percent of the domestic value of the merchandise.
  – Gross negligence: the statutory maximum is 40 percent of the domestic value; under the regulations, 25 percent to 40 percent of the domestic value of the merchandise.
  – Negligence: the statutory maximum is 20 percent of the domestic value; the regulations estimate five to 20 percent of the domestic value of the merchandise.
 
As mentioned above, CBP’s new enhanced enforcement powers will potentially lead to an increase in trade prosecutions. [FN/2]   Therefore, we strongly recommend importers get acquainted with CBP’s penalty assessment procedure. Knowing how CBP’s penalty determination process operates can help importers to be better prepared in the unfortunate event they are involved in an import violation.
 
———
  [FN/1] CBP Facilitates Record Level of Travelers and Modernizes Trade Systems in FY2016, U.S. Customs and Border Protection (Jan. 12, 2017), available at here.
  [FN/2] Trade Facilitation and Trade Enforcement Act of 2015 § 101, 19 U.S.C. § 4311 (2016).
  [FN/3] Trade Facilitation and Trade Enforcement Act of 2015 § 101, 19 U.S.C. § 4311 (2016).
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COMM_a0210. M. Volkov: “DOJ’s Compliance Program Evaluation: the Role of the CCO (Part II of IV)”

(Source: Volkov Law Group Blog. Reprinted by permission.)
 
* Author: Michael Volkov, Esq., Volkov Law Group, mvolkov@volkovlaw.com, 240-505-1992.
 
[Editor’s note: Part I of Michael Volkov’s series of commentaries on the DOJ Compliance Program was posted in The Daily Bugle on 1 March 2017.]
 
DOJ’s Compliance Evaluation highlights important trends in the role and independence of the Chief Compliance Officer. DOJ has stopped short of requiring direct reporting of a CCO to a CEO or other senior officer but it is inching closer to such a demand.
 
In the topic area relating to Stature [of a CCO], DOJ lists important issues for a company to consider in designing its compliance function – specifically, a company has to consider how the compliance function compares with other strategic functions in the company in terms of “stature, compensation levels, rank/title, reporting line, resources and access to key decision-makers.” Most companies will fall short on this list of key components. It is rare these days to find compliance elevated to meet all of the requirements listed by DOJ, and there does not seem to be any sense of urgency in corporations to address these important issues. To the contrary, companies claim they are moving forward on these issues but when you examine them carefully, they fall woefully short in most instances.
 
While there has been an important elevation in the role of CCOs in most companies, CCOs do not have the stature of comparable functions nor the “line of sight” across the organization to carry out their responsibilities. CCOs continue to lag behind comparable functions in terms of compensation, rank/title, reporting line, and access to key decision makers.
 
I want to highlight one area in particular where CCOs are suffering – resources. Unlike internal auditors who can demand additional resources needed to comply with basic financial Sarbanes-Oxley requirements, Audit/Compliance Committees fail to respond to resource needs in the compliance arena with any urgency, usually putting off such requests or seeking interim, band-aid, solutions. CCOs have been beaten down on this issue and need to bring this to the forefront. There is nothing more damaging to a company’s ethics and compliance program then continuing strangulation of effectiveness by lack of resources.
 
Companies have a better record in fostering CCO independence and autonomy. DOJ’s questions in this area, however, reinforce this trend by asking if the CCO has a direct reporting line to the board, and how often they meet. A robust reporting relationship with direct access to the board is a critical requirement for a compliance function.
 
DOJ’s questions, however, go a little further by asking how the compliance function performance is reviewed, who determines hiring, compensation and firing of CCOs, and other steps taken to ensure independence of the compliance function.
 
Companies need to focus on this question and have the board hire, fire and negotiate terms and conditions for the CCO. A corporate board is the ultimate entity responsible for compliance and this needs to be reinforced by putting the board in charge of the CCO’s contract and compensation.
 
DOJ’s questions on empowerment include an interesting set of questions focused on whether there have been specific transactions or deals were “stopped, modified, or more closely examined” as a result of compliance concerns? This inquiry is creative an reflects an understanding of how a robust compliance program could influence a company’s business operations.
 
The question, however, is misguided and reflects an immature understanding of how a compliance function may influence business operations without resulting in a specific intervention. Indeed, in some cases, a compliance function, if given a seat at the business table, may create a general frame of reference that will avoid a more specific “confrontation” between business and compliance resulting in a change in a specific deal or transaction. Nonetheless, the question sets out an interesting perspective that a CCO should consider when interacting with business operations.
 
Finally, the Compliance Evaluation questions focus on outsourcing of compliance functions. This is an important issue because it raises an important issue – are companies relying on outside consultants, accountants and law firms to conduct basic compliance functions? We have seen a cottage industry around compliance grow. However, it important to distinguish between day-o-day operations and functions that provide value to the overall operation of a compliance program. The question of outsourcing and what is outsources is important to consider because in many cases it may be a means to obfuscate or delay internal consideration of basic resource needs for compliance programs.

[Editor’s note: Part III of Michael Volkov’s series of commentaries on the DOJ Compliance Program will be posted in The Daily Bugle on 3 March 2017.]

 

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COMM_a311. R.C. Burns: “Assassination In Malaysia Leads To Calls to Redesignate DPRK As A Terrorist State”

(Source:
Export Law Blog
. Reprinted by permission.)
 
* Author: R. Clifton Burns, Esq., Bryan Cave LLP, Wash DC,
Clif.Burns@bryancave.com
, 202-508-6067)
 
The assassination by the Norks of Kim Jong Un’s brother in a Malaysian airport with the help of gullible stooges and some VX nerve agent has reignited the debate as to whether the State Department should redesignate the DPRK as a state sponsor of terrorism. The DPRK was first put in the list after it bombed a Korean Air Flight in 1987, killing 115 people. The country was removed in 2008 in return for shutting down its plutonium plant and permitting inspections.
 
In order to designate a country as a state sponsor of terrorism, a determination must be made that the country “repeatedly provided support for acts of international terrorism.” See, e.g., section 6(j) of the (zombie) Export Administration Act. None of the statutes that invoke that phrase define “acts of international terrorism,” although section 40(d) of the Arms Export Control Act states that the term includes activities that “aid or abet the efforts of an individual or group to use … chemical, biological, or radiological weapons.” I suppose that might cover the murder of an individual with a chemical weapon in an airport, although terrorism seems more readily to mean an act that indiscriminately targets multiple civilians in order to instill fear in a population or community.
 
Advocates of redesignation have argued that the cyber attack on Sony (in connection with its distribution of the hilarious and decidedly anti-Nork film The Interview) and other assassinations abroad demonstrate repeated acts of terrorism. But again, it’s hard to argue that these acts, while reprehensible, are designed to instill fear in a community.
 
In any event, the redesignation would be most symbolic. Once designated, U.S. law prohibits arms sales, which are already prohibited. Licenses would be required for certain specified goods, but section 746.4 of the EAR already requires licenses for all items subject to the EAR other than food and medicine. Being designated as a state sponsor of terrorism means that under the Trade Sanctions and Export Reform Act of 2000 a one-year license is required for exports to that country of agricultural commodities, medicine or medical devices, but North Korea is explicitly exempted from this by section 7205(a)(2).
 
Given that the redesignation of the loathsome Norks would be mostly symbolic, it seems to be a bad idea to torture the definition of “international terrorism” to include computer hacking and individual murders to get there.

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ENEDITOR’S NOTES

(Source: Editor)

*
Sam Houston (Samuel Houston, 2 Mar 1793 – 26 Jul 1863, was an American politician and soldier, best known for his role in bringing Texas into the United States as a constituent state. His victory at the Battle of San Jacinto secured the independence of Texas from Mexico in one of the shortest decisive battles in modern history. He was the only American to be elected governor of two states.)

  – “Texas will again lift its head and stand among the nations. It ought to do so, for no country upon the globe can compare with it in natural advantages.”

 

*
Dr. Seuss (Theodor Seuss Geisel, 2 Mar 1904 – 24 Sep 1991, was an American writer, cartoonist, animator, book publisher, and artist best known for authoring children’s books, including
The Cat in the Hat (1957),
How the Grinch Stole Christmas! (1957), and
Green Eggs and Ham (1960) under the pen name Dr. Seuss. His work includes several of the most popular children’s books of all time, selling over 600 million copies and being translated into more than 20 languages by the time of his death.)

  – “You’re never too old, too wacky, too wild, to pick up a book and read to a child.” 

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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: 24 Feb 2017: 82 FR 11505-11506: Temporary General License: Extension of Validity

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
  – Last Amendment: 10 Feb 2017: 82 FR 10434-10440: Inflation Adjustment of Civil Monetary Penalties.  
 
*
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: 10 Feb 2017: Harmonized System Update 1701, containing 1,295 ABI records and 293 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: 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.  

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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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