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17-1020 Friday ” Daily Bugle”

17-1020 Friday “Daily Bugle”

Friday, 20 October, 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. Commerce/BIS Appoints Performance Review Board Member
  2. DoD/DARS Seeks Comments on Potential MoU’s with UK and Finland
  3. DoD/GSA/NASA Seek Comments on Federal Acquisition Regulation Buy American, Trade Agreements, and Duty-Free Entry
  4. DHS/CBP Seeks Comments on Form 3311, Declaration for Free Entry of Returned American Products
  1. Ex/Im Items Scheduled for Publication in Future Federal Register Editions 
  2. Commerce/BIS: (No new postings.)
  3. DHS/CBP Posts HSU 1707
  4. State/DDTC Posts Name Change for Manroy Engineering Ltd.
  1. ST&R Trade Report: “Dates and Deadlines: Trade Policy, AEO, CBP Audit Surveys, Trade Barriers, FTZs”
  2. WorldECR News Alert, 20 Oct
  1. A. Abrahamian: “Trump’s Iran Decision Hurts Chance of a North Korea Deal”
  2. Bulletin of the Atomic Scientists: “Blockchain: A New Aid to Nuclear Export Controls?”
  3. M. Lester: “Security Council Assessment of UN Sanctions Review”
  4. M. Volkov: “ISO 37001: Risk Assessments, Employees, and Due Diligence Requirements (Part IV of V)”
  5. R.C Thomsen II, A.D. Paytas, M.M. Shomali: “Reminder: Export Controls Still Apply to Sudan!”
  6. R.C. Burns: “The UNPA Sidestep Doesn’t Allow OFAC to Shuffle Past the Berman Amendment”
  1. Friday List of Approaching Events: 18 New Events Posted This Week
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Changes: ATF (15 Jan 2016), Customs (28 Sep 2017), DOD/NISPOM (18 May 2016), EAR (3 Oct 2017), FACR/OFAC (16 Jun 2017), FTR (20 Sep 2017), HTSUS (20 Oct 2017), ITAR (30 Aug 2017)
  3. Weekly Highlights of the Daily Bugle Top Stories 

EXIMEX/IM ITEMS FROM TODAY’S FEDERAL REGISTER

 
82 FR 48792: Membership of the Performance Review Board for EDA, NTIA and BIS
* AGENCY: EDA, NTIA and BIS, Department of Commerce.
* ACTION: Notice of Membership on the EDA, NTIA and BIS’s Performance Review Board.
* SUMMARY: The EDA, NTIA and BIS, Department of Commerce (DOC), announce the appointment of those individuals who have been selected to serve as members of the Performance Review Board. The Performance Review Board is responsible for (1) reviewing performance appraisals and ratings of Senior Executive Service (SES) members and Senior Level (SL) members and (2) making recommendations to the appointing authority on other performance management issues, such as pay adjustments, bonuses and Presidential Rank Awards for SES and SL members. The appointment of these members to the Performance Review Board will be for a period of twenty-four (24) months.
* DATES: The period of appointment for those individuals selected for EDA, NTIA and BIS’s Performance Review Board begins on October 20, 2017.
* FOR FURTHER INFORMATION CONTACT: Joan Nagielski, U.S. Department of Commerce, Office of Human Resources Management, Department of Commerce Human Resources Operations Center, Office of Employment and Compensation, 14th and Constitution Avenue NW., Room 50013, Washington, DC 20230, at (202)482-6342.
* SUPPLEMENTARY INFORMATION: …
   Dates: The name, position title, and type of appointment of each member of the Performance Review Board are set forth below:
 
  – Department of Commerce, Bureau of Industry and Security (BIS), Carol Rose, Chief Financial Officer and Director of Administration, Career SES …
 
   Dated: October 17, 2017.
Joan M. Nagielski, Human Resources Specialist, Office of Employment and Compensation, Department of Commerce Human Resources Operations Center, Office of Human Resources Management, Office of the Secretary, Department of Commerce.

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FR_a2

 
82 FR 48805-48806: Negotiation of a Follow on Reciprocal Defense Procurement Memorandum of Understanding With the Ministry of Defence of the United Kingdom of Great Britain and Northern Ireland and With the Republic of Finland
* AGENCY: Department of Defense (DoD).
* ACTION: Request for public comments.
* SUMMARY: On behalf of the United States Government, DoD is contemplating negotiating and concluding two follow on Reciprocal Defense Procurement (RDP) Memoranda of Understanding (MOU) with the Ministry of Defence of the United Kingdom of Great Britain and Northern Ireland and with the Republic of Finland, respectively. DoD is requesting industry feedback regarding its experience in public defense procurements conducted by or on behalf of the United Kingdom (UK) Ministry of Defence and by or on behalf of the Republic of Finland (Finland) Ministry of Defence.
* DATES: Comments must be received by November 20, 2017.
* ADDRESSES: Submit comments to Defense Procurement and Acquisition Policy, Attn: Ms. Patricia Foley, 3060 Defense Pentagon, Room 5E621, Washington, DC 20301-3060; or by email to patricia.g.foley.civ@mail.mil.
* FOR FURTHER INFORMATION CONTACT: Ms. Patricia Foley, Senior Procurement Analyst, Office of the Under Secretary of Defense for Acquisition, Technology and Logistics (OUSD(AT&L)), Defense Procurement and Acquisition Policy, Contract Policy and International Contracting; Room 5E621, 3060 Defense Pentagon, Washington, DC 20301-3060; telephone 703-693-1145.
* SUPPLEMENTARY INFORMATION: …
  While DoD is evaluating laws and regulations in this area, DoD
wouldbenefit from U.S. industry’s experience in participating in public defense procurements issued by these countries. DoD is, therefore, asking U.S. firms that have participated or attempted to participate in procurements by or on behalf of the UK’s Ministry of Defence or Finland’s Ministry of Defence to let us know if the procurements were conducted with transparency, integrity, fairness, and due process in accordance with published procedures, and if not, the nature of the problems encountered.
  DoD is also interested in comments relating to the degree of reciprocity that exists between the United States and the UK Finland when it comes to the openness of defense procurements to offers of products from either country.
 
Jennifer L. Hawes, Editor, Defense Acquisition Regulations System.

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EXIM_a3

3. DoD/GSA/NASA Seek Comments on Federal Acquisition Regulation Buy American, Trade Agreements, and Duty-Free Entry

(Source: Federal Register) [Excerpts.]
 
82 FR 48811-48812: Submission for OMB Review; Federal Acquisition Regulation Buy American, Trade Agreements, and Duty-Free Entry
* AGENCY: Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
* ACTION: Notice of request for public comments regarding an extension to an existing OMB clearance. …
* DATES: Submit comments on or before November 20, 2017. …
* FOR FURTHER INFORMATION CONTACT: Ms. Cecelia L. Davis, Procurement Analyst, Acquisition Policy Division, GSA 202-219-0202 or email cecelia.davis@gsa.gov.
* SUPPLEMENTARY INFORMATION: …
  (1) Buy American and Trade Agreements–Supplies:
    – FAR Clause 52.225-2, Buy American Certificate, requires the offeror to identify in its proposal supplies for use in the United States that do not meet the definition of domestic end product. The Buy American statute does not apply to acquisitions of commercial information technology. …
    – FAR Clause 52.225-4, Buy American-Free Trade Agreements–Israeli Trade Act Certificate, requires separate listing of foreign products that are eligible under a trade agreement, and listing of all other foreign end products. …
    – FAR Clause 52.225-6, Trade Agreements Certificate, requires the offeror to certify that all end products are either U.S.-made or designated country end products, except as listed in paragraph (b) of the provision. Offerors are not allowed to provide other than a U.S.-made or designated country end product, unless the requirement is waived. …
  (2) Buy American and Trade Agreements–Construction provisions and clauses provide that an offeror/contractor requesting to use foreign construction material due to unreasonable cost of domestic construction material shall provide adequate information to permit evaluation of the request. …
  (3) Duty-Free Entry. The clause at FAR 52.225-8, Duty-Free Entry (formerly OMB clearance 9000-0022), is included in solicitations and contracts for supplies that may be imported into the United States and for which duty-free entry may be obtained in accordance with FAR 25.903(a), if the value of the acquisition (1) exceeds the simplified acquisition threshold; or (2) does not exceed the simplified acquisition threshold, but the savings from waiving the duty is anticipated to be more than the administrative cost of waiving the duty. The contracting officer analyzes the information submitted by the contractor to determine whether or not supplies should enter the country duty-free. …
 
  Dated: October 16, 2017.
Lorin S. Curit, Director, Federal Acquisition Policy Division, Office of Government-wide Acquisition Policy, Office of Acquisition Policy, Office of Government-wide Policy.

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EXIM_a4

4. DHS/CBP Seeks Comments on Form 3311, Declaration for Free Entry of Returned American Products

(Source: Federal Register) [Excerpts.]
 
82 FR 48839-48840: Agency Information Collection Activities: Declaration for Free Entry of Returned American Products
* AGENCY: U.S. Customs and Border Protection (CBP), Department of Homeland Security.
* ACTION: 60-Day notice and request for comments; extension of an existing collection of information. …
* FOR FURTHER INFORMATION CONTACT: Requests for additional PRA information should be directed to CBP Paperwork Reduction Act Officer, U.S. Customs and Border Protection, Office of Trade, Regulations and Rulings, Economic Impact Analysis Branch, 90 K Street NE., 10th Floor, Washington, DC 20229-1177, or via email CBP_PRA@cbp.dhs.gov. Please note that the contact information provided here is solely for questions regarding this notice. Individuals seeking information about other CBP programs should contact the CBP National Customer Service Center at 877-227-5511, (TTY) 1-800-877-8339, or CBP Web site.
* SUPPLEMENTARY INFORMATION: …
  – Title: Declaration for Free Entry of Returned American Products.
  – OMB Number: 1651-0011.
  – Form Number: CBP Form 3311. …
  – Abstract: CBP Form 3311, Declaration for Free Entry of Returned American Products, is used by importers and their agents when duty-free entry is claimed for a shipment of returned American products under the Harmonized Tariff Schedules of the United States. This form serves as a declaration that the goods are American made and that they have not been advanced in value or improved in condition while abroad; were not previously entered under a temporary importation under bond provision; and that drawback was never claimed and/or paid. CBP Form 3311 is authorized by 19 CFR 10.1, 10.66, 10.67, 12.41, 123.4, and 143.23 and is accessible here. …
 
  Dated: October 17, 2017.
Seth Renkema, Branch Chief, Economic Impact Analysis Branch, U.S. Customs and Border Protection.

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OGSOTHER GOVERNMENT SOURCES

OGS_a15
. Ex/Im Items Scheduled for Publication in Future Federal Register Editions
 

(Source:
Federal Register)
 

* Commerce; Industry and Security Bureau; RULES; Amendments to Existing Validated End-User Authorization in the People’s Republic of China: Lam Research Service Co., Ltd. [Publication Date: 23 October 2017.]  

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(Source:
CSMS #17-000664, 20 Oct 2017.)
 
Harmonized System Update (HSU) 1707 was created on October 19, 2017 and contains 27,291 ABI records and 5,164 harmonized tariff records.
 
Modifications include those mandated by the Agricultural Marketing Service, adjusting the assessment on imported cotton and cotton products, effective November 6, 2017. Please use the link here to reference the associated Federal Register Notice…
 
Participating Government Agency (PGA) indicators were also updated.
 
Adjustments required by the verification of the 2017 Harmonized Tariff Schedule (HTS) are included as well.
 
The modified records are currently available to all ABI participants and can be retrieved electronically via the procedures indicated in the CATAIR. For further information about this process, please contact your client representative. For all other questions regarding this message, please contact Jennifer Keeling via email at Jennifer.Keeling@cbp.dhs.gov
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(Source:
State/DDTC) [Excerpts.]
 
Effective September 1, 2017, Manroy Engineering Ltd. has changed as follows: FNH UK 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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NWSNEWS

 
Following are highlights of regulatory effective dates and deadlines and federal agency meetings coming up in the next week.
 
  – 23 Oct: deadline for comments to NMFS on draft list of foreign fisheries
  – 23 Oct: deadline for comments to ITA on annual FTZ report
  – 23 Oct: deadline for comments on request for new FTZ subzone at New Jersey facility
  – 23 Oct: deadline for comments to FDA on food facility recordkeeping and records access requirements
  – 24 Oct: deadline for comments to ITC on IPR import restrictions on personal computers and mobile devices
  – 25 Oct: deadline for comments to FTZ Board on request for subzone at Texas aircraft facility
  – 25 Oct: deadline for comments to USTR on foreign trade barriers
  – 27 Oct: deadline for comments to USDA on proposed increase to importer representation on Watermelon Board
  – 27 Oct: deadline for comments to ITC on potential remedies in IPR infringement investigation of L-tryptophan products 
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  (1) JCPOA de-certification an ‘internal US process’, says EU
  (2) EU tightens sanctions on North Korea
  (3) Canada publishes consolidated sanctions list
  (4) McKinsey finds ‘violations of professional standards’ but no bribery at SA arm
  (5) Equifax breach highlights importance of company response to cyberattack
 
[Editor’s Note: Visit http://worldecr.com/ to subscribe to WorldECR, the journal of export controls and sanctions.]
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COMMCOMMENTARY

COMM_a211
. A. Abrahamian: “Trump’s Iran Decision Hurts Chance of a North Korea Deal”

(Source:
Reuters,
19 Oct 2017.)
 
* Author: Andray Abrahamian, WSD-Handa Fellow at Pacific Forum CSIS and Adjunct Fellow at the Griffith Asia Institute, webmaster@csis.org.
 
Donald Trump’s undermining of the Iran nuclear deal only shrinks U.S. options for dealing with North Korea. The U.S. president’s decertification of Tehran’s compliance will be well noted in Pyongyang, giving North Korean leader Kim Jong Un a credible excuse for refusing to negotiate with Washington.
 
The U.S.-North Korea situation is becoming more fraught as both sides attempt to pile on pressure, pushing prospects for talks further away.
 
Just two months ago, I argued that Americans needed to put North Korea’s missile tests in perspective. (“Yes, they’re worrying. But the U.S. mainland is not in imminent danger.”) Now I’m slightly less sanguine: either side could make a catastrophic miscalculation while tensions persist. Even before Trump’s decision on Iran, the prospects for negotiations were diminishing.
 
For one, things got personal. Following an incendiary Sept. 19 speech at the U.N. General Assembly in which Trump called Kim Jong Un “Rocket Man” and threatened to “totally destroy” North Korea, Kim wrote a personal letter, carried by Pyongyang’s main newspaper, calling Trump a “dotard,” among other things.
 
Insults and mudslinging have become part of the currency in U.S. domestic politics, but what works on the campaign trail won’t work with North Korea. There, the dignity and image of the leader is near-sacred and name-calling will be counterproductive. Elite politicking in Pyongyang is in no small part about competing to show loyalty to the supreme leader. Debate does take place at very senior levels, but only before Kim announces a position – never in contradiction to it. Any North Korean voices promoting a softer line will have been further hushed by the personal offense Kim has taken and by his forceful rhetorical pushback.
 
Second, the U.N. Security Council tightened sanctions against Pyongyang in August and September. These have banned all North Korea’s major exports, including textiles, seafood and coal as well as joint ventures with foreign companies and new contracts hiring North Koreans as laborers abroad. China’s agreement to these measures was key and some degree of enforcement seems to be taking place.
 
This reinforces Pyongyang’s bunker mentality. The zero-sum game it sees with Washington is now compounded by China’s “betrayal” in supporting these sanctions. North Korea feels it is in a life-or-death struggle and cannot be seen to flinch at this, its most difficult strategic moment in the 21st century. Given the extreme level of state control over its citizens, North Korea is also well positioned to endure suffering and tolerate a severe economic contraction.
 
This brings us to Iran, where the political system is partially democratic and where sanctions did indeed contribute to voices of compromise in Tehran’s government. This led to negotiations and, finally, in 2015 the Joint Comprehensive Plan of Action (JCPOA), usually referred to as the Iran nuclear deal.  
 
The agreement is not perfect. After many years of talks, however, European and U.S. negotiators thought the deal was the best they could get. The deal does make it extremely difficult for Iran to develop nuclear weapons. Iran’s uranium stockpiles have been reduced by over 95 percent, its centrifuges by over 60 percent and its ability to enrich uranium has been capped far below the threshold for nuclear weapons. Inspections verify this at all points in the supply and production chains.
 
The agreement’s limitations include having expiration dates on these restrictions. It also does not include curbs on Tehran’s missile programs. But Trump’s refusal to re-certify Iran’s compliance last week seems largely because of Iran’s other moves in the Middle East, including support for Bashar al-Assad in Syria and Hezbollah in Lebanon.
 
Trump’s Oct. 13 speech has not killed the deal – at least not yet – but it does kick the ball over to Congress, which now has to determine whether to pull out or remain. It’s not clear what Congress will do but the deal will be in jeopardy if Congress decides to resurrect pre-deal sanctions or introduce new ones.
Crucially, International Atomic Energy Agency inspectors and all the other parties to the Iran agreement, including the European Union, Germany and U.N. Security Council members China, France, Russia and the United Kingdom say Iran is in compliance and that the deal should remain in place. In various statements they have all said the deal should continue to be adhered to.
Trump laid out a broader policy in which he wants to pressure U.S. allies into redoing the deal, while also trying to contain Iran’s other activities in the region more actively. But blowing up the deal would only further isolate Washington on the world stage.
 
This is important in terms of taking the high ground in the tensions with North Korea. Many countries in the international community, especially China, have been trying to coax North Korea back to negotiations, but they have been consistently rebuffed. Pyongyang officials argue that their country has a right to have nuclear weapons and that they are a necessity as deterrence against their old enemy.
 
On top of that, the North Korean authorities now can say: “See? Even if we come back to talks and make a deal with the United States, how can we trust them? Why would we ever give up our nuclear weapons for an agreement with this country?” To be fair, the regime already doesn’t trust the U.S. for its own reasons, but now it can justify it to the international community and make it harder for America’s allies to credibly argue against it.
 
Moreover, will China and Russia sign on to further U.N. Security Council resolutions against North Korea when the United States has shown itself to be so reticent to abide by complicated, negotiated solutions? These two countries may even lose patience with enforcing U.N. sanctions if they perceive the Trump administration to be only focused on pressure as a punitive measure rather than an attempt to find constructive solutions.
 
A negotiated solution to the North Korea crisis now seems well beyond the horizon. Trump’s jeopardizing of the Iran deal nudges it even further away. Until it comes into view, we all need to hope that neither side makes a mistake as they try to project toughness during this fraught period.

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Don’t worry if you have yet to hear about blockchain, the emerging technology set to reshape everything from finance and trade to global governance-you are in good company. According to one recent survey of 12,000 people in 11 countries, 60 percent had never heard of the technology and 80 percent
could not explain how it works
. Yet, for a technology that few understand, blockchain is sure making waves. The World Economic Foundation (WEF), for example, found that 80 percent of global banks will have initiated blockchain-related projects by the end of 2017. Perhaps even more startling: By 2027, the WEF predicts,
10 percent of global gross domestic product
will be held in blockchain technology.
 
While most people have not heard of blockchain, many do know of its most visible implementation, Bitcoin, a cryptocurrency used to store and transfer value. Although cryptocurrencies tend to dominate media attention, the underlying technology, blockchain, has far-reaching applications; it can be used to store property records, clear and settle accounts, ensure the validity and execution of contractual arrangements, and-possibly- prevent the illicit procurement of weapons of mass destruction-related goods and technologies.
 
Conceptually, blockchain solves the problem of intermediation. Take for example mobile banking. While the popularity of mobile banking has increased globally, providing access to those traditionally excluded from formal financial systems, these systems still rely on several intermediate services-middlemen like clearing houses and payment processors. Not only do these middlemen increase costs; they also require each party to a transaction to place a high degree of trust in them. Moreover, each intermediary has its own political and economic interests that it uses to dictate terms of access. This system works at a basic level, but a truly distributed system-one in which all the parties could easily verify transactions at each step of the process-could bring radical change in terms of inclusivity, transparency, and equity. Blockchain threatens to do this and upend this status quo.
 
At its core, blockchain is a decentralized, distributed ledger system that stores and verifies information using cryptographic protocols. That is say, blockchain allows a true peer-to-peer transfer of assets that is verifiable, transparent, and immutable. It is verifiable in the sense that blockchain uses a consensus-based approach to keeping the ledger accurate. While the identity of parties may be hidden in any given transaction, the nature of the transaction itself is immediately transparent on the entire blockchain. This means a full record of each transaction is available for all to see. Finally, blockchain transactions use cryptographic protocols to ensure that once a transaction is recorded in the ledger, it cannot be altered.
 
Supply-side controls: the cornerstone of global nonproliferation efforts
.
 
Today’s supply-side efforts to control the spread of nuclear weapons technology consist of a rainbow of decentralized, sometimes overlapping and sometimes fragmented systems of international agreements, informal arrangements, and national legislation. These efforts range from export licensing and targeted sanctions to corporate compliance and due diligence programs. Not surprisingly, differences in national implementation and enforcement continue to frustrate efforts to keep dual-use goods and technologies out of proliferator hands. These implementation gaps, coupled with the sheer volume of global trade and commerce, have reduced the barriers to entry for intermediaries and created pathways for illicit procurement networks to exploit.
 
An August 2017 UN Panel of Experts report on North Korean sanctions illustrates several of these challenges. Despite the “most comprehensive and targeted sanctions regime in United Nations history,” North Korea continued to evade both sectoral and targeted financial sanctions. Using networks of shell companies to obfuscate payments, forming partnerships with foreign financial institutions, and exploiting jurisdictions with weak enforcement of export controls, Pyongyang was able to stay relatively well connected to global trade and commerce systems. Take, for example, the case against Dandong Hongxiang Industrial Development Co., which is a Chinese-based trading company responsible for facilitating transactions on behalf of sanctioned North Korean entities. In a September 2016 complaint, the United States alleges that Dandong Hongxiang Industrial Development Co. and its owner, Ma Xiaohong, laundered transactions and handled supply chain logistics for Korea Kwangson Banking Corporation-a North Korean bank sanctioned for its role in North Korea’s weapons of mass destruction (WMD) activities.
 
At a very fundamental level, regulation of intermediary services in export-controlled transactions is a very real problem. Whether those transactions entail the manufacture, sale, financing, or shipment of export-controlled goods and technologies, they all rely on some level of intermediation-the banks that deal with financing, the legal contracts between supplier and buyer, or the agreements to insure and ship goods.
The potential applications of blockchain technology to help control the spread of WMD-related goods and technologies are practically endless.
 
Recent commercial implementations of blockchain may be a good indicator of what is to come. After a scandal involving tainted pork products in China, retailer Walmart implemented a trial program to store shipping and food distribution data that would ensure authentication of its supply chain and provide accurate product tracking. According to the press release, blockchain, “could serve as an alternative to traditional paper tracking and manual inspection systems, which can leave supply chains vulnerable to inaccuracies.”
 
In October 2016, Wells Fargo, Commonwealth Bank of Australia, and Bingham Cotton announced the first trade transaction to use blockchain technology. The system the parties devised resembled a letter of credit, which is a traditional trade-financing tool for reducing risk between buyers and sellers. In this case, the transaction involved the shipment of cotton from Texas to China, using a private blockchain system. This “smart contract” included a physical dimension whereby payments to the seller were released automatically, once the geographic location of the cotton was confirmed.
 
In a traditional letter of credit, release of funds is dependent on the delivery of documents and data to financial institutions-introducing the potential for human error or fraud. A recent report by Deloitte highlights some of the challenges with traditional trade financing, such as manual creation and distribution of contracts, multiple layers of checks and verifications by intermediaries, duplicative documentation, and version control of financing instruments. All of these steps increase transaction times and introduce the real possibility of fraud.
 
In fact, much of the illicit procurement activity related to Iran’s nuclear program relied on these types of trade financing instruments. It was not uncommon for illicit Iranian procurement networks to use multiple letters of credit, “daisy chained” together to obfuscate who was paying for and who was receiving dual-use goods.
 
Export licensing and end-user verification still, in part, rely on a paper-based system that is vulnerable to fraud. Take, for example, the 2016 case of Sihai “Alex” Cheng, a Chinese intermediary who was convicted and sentenced to nine years in prison for violating sanctions against Iran. According to court records, from 2009 to 2011, Cheng falsified import and export documents to transship controlled items with nuclear applications to Iran.
 
Blockchain technologies have the potential to address some of these falsification issues. In a given blockchain network of approved parties, for example, smart contracts can promote transparency and prevent export fraud. Once on the blockchain, ownership of an asset, like a contract, is immutable. That is, it cannot be changed unless the owner verifies the change. Key information for controlled goods-such as export control classification numbers, end-users, and other licensing information-can also be stored in the blockchain, and because this information is on a distributed ledger that all parties can see, it is easily verifiable. This could, hypothetically, make it difficult for unauthorized parties to fraudulently obtain and transship export-controlled goods. For example, in a blockchain system that includes buyers, sellers, shippers, and insurers, if a good is prohibited from re-export to a third-country, the shipper would not be able to receive payment if any leg of the transaction was altered.
 
Widespread implementation of blockchain faces an uphill battle.
 
There is no doubt that blockchain is set to revolutionize global trade and commerce. Total capital investments in blockchain technologies is almost $2 billion. More than 90 central banks worldwide are now engaged in discussions about implementing distributed ledger technology systems. Blockchain technologies have significant potential to upend conventional approaches to WMD supply-side controls, but there are several key challenges to widespread adoption.
 
While most recognize the potential of distributed ledger systems to decrease costs and increase efficiency, blockchain remains in its infancy. Firms are taking a cautious and measured approach to implementing blockchain solutions. Without significant buy-in from major companies, implementation of blockchain technologies could ultimately lead to an even more fragmented global export control system.
 
Scalability also remains an issue. As the size of a given blockchain ledger grows, so do the network and computational resources required to maintain it. Moreover, given the resources needed to maintain a large public ledger, questions remain about the ability handle a significant number of transactions. Currently, there are an average of 200,000 bitcoin transactions per day. Compare this to the Society for Worldwide Interbank Financial Telecommunication (SWIFT), which facilitates an average of 27.85 million financial messages per day. Although some have argued that these scalability issues prevent blockchain from true widespread adoption, others argue that it is just a matter of time for network and computational capacities to catch up.
 
Finally, there are legitimate and unanswered questions about regulating blockchain-enabled systems. How should governments regulate blockchain? In fact, should governments regulate blockchain? Remember, the underlying logic of blockchain is to eliminate the need for intermediaries. So, if blockchain solutions are immutable, transparent, rule-based systems, do they actually need to be regulated? In February, Rep. Jared Polis (D-CO) and David Schweikert (R-AZ) launched the Congressional Blockchain Caucus, which promotes a “hands-off regulatory approach, believing that this technology will best evolve the same way the internet did; on its own.”
 
The exception, however, has been the regulation and guidance issued around the use of cryptocurrencies- like Bitcoin. In March, for example, the US Securities and Exchange Commission ruled against a proposal to establish a bitcoin exchange, on the grounds that the technology lacked oversight and regulation and may be vulnerable to manipulation. As early as 2013, the US Financial Crimes Enforcement Network issued guidance to banks on the applicability of regulations pertaining to those who transact with cryptocurrencies.
 
Incorporating blockchain-based systems in export controls also faces an uphill battle when it comes to anti-money laundering, know-your-customer, and due diligence programs- all critical to effective WMD supply-side controls. Unfortunately, there seems to be little consensus as to whether blockchain-based systems will help or hinder monitoring for illicit transactions and fraud.
On one hand, the new technology opens up novel possibilities for transactional monitoring. The openness of blockchain, for example, can help ensure transparent and real-time monitoring across all transactions. Moreover, trade and finance systems based on blockchain means that financial transactions need not be conceptually separate from trade-related transactions (i.e., shipping and insurance), thereby increasing the granularity of information available to regulators, enforcement, and intelligence agencies.
 
On the other hand, however, the current anti-money laundering and know-your-customer systems are largely based on a traditional system of intermediated services. It is not entirely clear how these would need to change in a scenario that sees widespread integration of blockchain. Moreover, it is possible to envision a scenario in which illicit procurement networks exploit the security and relative anonymity of blockchain to facilitate transactions. In fact, recent news suggests that North Korea is pursuing cryptocurrencies as a means to avoid sanctions.
 
Is blockchain a realistic panacea for nuclear export controls?
 
The use of blockchain technologies to undergird global supply-side WMD control systems may be some years away. Nonetheless, it is clear that this technology will be a fundamental component to ensuring trust in global markets in the not too distant future. What should be done?
 
Coalitions, like the Nuclear Suppliers Group, should start thinking now about blockchain and its implications for supply-side controls. This includes developing a firm understanding of the relationships between public and private sector implementations of blockchain, and the consequences for controlling nuclear and dual-use goods and technologies. Issuing guidance on government-to-government assurances, the transference of dual-use goods and materials, and export licensing procedures with respect to blockchain will be necessary to reduce uncertainty during what will likely be a significant period of fragmented implementation and use of the technology.
 
Finally, the current system of laws and regulations related to export controls are insufficient to handle blockchain, and the continued adoption of blockchain-especially in the international trade and commerce sectors-will present fundamental problems for national enforcement activities. In a de-centralized system meant to be free from regulation, for example, how might law enforcement seize property or funds tied to an illegal export? On one hand, the transparency and “smart contract” properties of blockchain-enabled transactions can help reduce fraud and illicit activities. On the other hand, without new legal and regulatory frameworks, national authorities will be left flat-footed.
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* Author: Maya Lester, Esq., Brick Court Chambers, maya.lester@brickcourt.co.uk, +44 20 7379 3550.
 
The UN Security Council has published an
Assessment Report
assessing the
Compendium
of the ‘High Level Review’ of UN Sanctions (November 2015), which was the first comprehensive review of UN sanctions. The Compendium and the Assessment Report are “intended to serve as a basis for ongoing dialogue and engagement in promoting more effective and collaborative United Nations sanctions procedures”.
 
The Assessment Report makes 10 recommendations for strengthening cooperation within the UN sanctions system, enhancing cooperation between UN sanctions and the private sector, improving definitions and standards used in sanctions resolutions and related documents, refining the due process of UN sanctions, and supporting states that bear a disproportionate implementation burden.
* * * * * * * * * * * * * * * * * * * *

(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 1,2 and 3 of this series were included in in the 17, 18, and 19 Oct Daily Bugles, respectively.]
 
In Part IV of my series on ISO 37001, I examine requirements relating to risk assessments, design of policies and procedures, and due diligence requirements.
 
Section 4.5 sets out requirements for conducting risk assessments. ISO 37001 requires companies to conduct regular risk assessments in order to identify the bribery risks the company might reasonably anticipate; analyze, assess and prioritize the identified bribery risks; and evaluate the company’s existing controls to mitigate the assessed risks. A company is required to review the risk assessment on a regular basis so that changes and new information can be properly assessed or in the event of a significant change to the structure or activities of the company.
 
Under Section 6.1, a company is required to design an anti-bribery risk management system that can provide reasonable assurance that the system can achieve its objectives.
 
Section 6.2 requires a company’s risk management system has to be: measurable; tailored to the company’s risk profile; monitored; communicated internally and externally; and updated as appropriate.
 
Section 7.1 requires that a company shall determine and provide the resources needed to establish, implement, maintain, and improve its anti-bribery management system.
 
Employees and Conflicts of Interest
 
Under Section 7.2, a company must ensure that its employees whose activities may impact its anti-bribery performance are competent on the basis of education, training and experience.
 
With respect to its employment procedures, companies are required to implement procedures to ensure that: as a condition of employment, all employees must comply with the company’s anti-bribery policy and risk management system; personnel receive a copy of the company’s anti-bribery policy and attend training in relation to the policy; personnel are subject to discipline for violating the company’s policy; and employees are not subjected to any form of retaliation for reporting suspected violations or raising concerns.
 
Significantly, a company is required to conduct due diligence of prospective employees before they are employed or existing employees that may be transferred to positions in which they may face anti-bribery risks to determine that it is reasonable to believe that such employees will comply with the company’s anti-bribery requirements.
 
The Illustrative Guidance includes suggested steps prior to hiring, depending on the persons’ proposed functions, including:
 
  – Discussing the company’s anti-bribery policy during the interview process and confirm that the prospective employee understands and accepts such a policy; and
  – Taking reasonable steps to: (i) verify the prospective employee’s qualifications; (ii) obtain satisfactory references from a prospective employee’s previous employers; (iii) determine whether prospective employee has been involved in bribery; (iv) verify that the prospective employee is not being offered employment in return for improperly favoring the company while working for another company; (v) verify that the prospective employee is being offered a position in order to favor the company; and (vi) verifying the prospective employee’s relationships with public officials.
 
As an additional requirement, the company is required to review periodically its performance bonuses, targets and other incentives to verify that there are reasonable safeguards to prevent incentives that encourage bribery. The Illustrative Guidance also notes that personnel evaluations, promotions, bonuses and other rewards could be used as incentives for personnel to act in accordance with the company’s anti-bribery policy and management system. Conversely, the Illustrative Guidance notes that companies should inform personnel of the consequences of violating its anti-bribery policy and anti-bribery management system.
 
The Illustrative Guidance includes discussion of conflicts of interest and suggests that companies identify and evaluate the risk of internal and external conflicts of interest. Such conflicts may create incentives for an employee to facilitate bribery or fail to prevent or report bribery.
 
Due Diligence
 
ISO 37001 sets out an interesting approach to due diligence and relationships with business associates. Interestingly, ISO 37001 permits exclusion of low risk transactions, business associate classifications (e.g. low spend vendors or suppliers) specific business associates or employees. Under Section 8.2, a company shall assess the nature of the bribery risks in relation to specific transactions, projects, activities, business associates and personnel, and shall be updated at a defined frequency, so that new information can be taken into account.
 
For each business associate with more than a low bribery risk, a company must assess the business associates’ anti-bribery risk management system and require the business associate to implement adequate controls. Additionally, the company must secure the right to terminate the relationship with the business associate in the event that the business associate engages in bribery.
 
[Editor’s Note: The final part in this series will be included on Monday, 23 October 2017.]
* * * * * * * * * * * * * * * * * * * *

(Source:
alerts@t-b.com, 20 Oct 2017.)
* Authors: Roszel C. Thomsen II, Esq., roz@t-b.com; Antoinette D. Paytas, Esq., toni@t-b.com; and Maher M. Shomali, Esq., maher@t-b.com. All of Thomsen & Burke LLP.
 
Last week, the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) revoked certain sanctions with respect to Sudan and the Government of Sudan. With this removal, there has been some confusion over whether sales to Sudan are now permitted.
 
In general, any item or technology classified under the Commerce Control List (CCL) of the Export Administration Regulations (EAR) still requires export authorization from the Commerce Department’s Bureau of Industry and Security (BIS). Typically, this means that a license is required when exporting these items to Sudan.
 
There are some exemptions for narrow cases. For example, items designated as EAR99 are outside of the scope of BIS’s licensing requirements. There are also some License Exceptions available for exports to Sudan, including License Exception CCD, which authorizes the export of certain mass-market communications-related devices to Sudan.
 
Sudan is still considered a state-sponsor of terrorism and therefore remains subject to Anti-Terrorism controls under the EAR, and is identified in Country Group E:1 of Supplement No. 1 to Part 740 of the EAR.
 
The removal of OFAC-administered sanctions on Sudan will have a greater impact on businesses that either do not export controlled products, that only operate a service from the United States (e.g., a cloud-based web service), or that are foreign companies reexporting certain U.S.-origin items.
 
Web Links
* * * * * * * * * * * * * * * * * * * *

(Source:
Export Law Blog
, 20 Oct 2017. Reprinted by permission.)
 
* Author: R. Clifton Burns, Esq., Bryan Cave LLP, Wash DC,
Clif.Burns@bryancave.com
, 202-508-6067).
 
My post two days ago on the fourth designation of IRGC by OFAC and OFAC’s claim that this new designation would prevent the supply of informational materials to the IRGC notwithstanding the Berman Amendment has resulted in a lively debate over in the Twitter-verse.  Some are arguing that because section 105 of the Countering America’s Adversaries Through Sanctions Act (“CATSACT”) specifically directs the President to sanction IRGC under Executive Order 13224, and because Executive Order 13224 was promulgated in reliance on the United Nations Participation Act (“UNPA”), the Berman Amendment’s restriction on informational embargoes doesn’t apply.
 
Because a boring legal and export-geeky argument follows, here is the TL;DNR – Now that the Security Council has lifted its sanctions on the IRGC, the UNPA does not justify designation of the IRGC. That designation is properly made under IEEPA, meaning that the Berman Amendment still applies
 
The UNPA was passed in 1945 and, as it title implies, is the act that permitted U.S. participation in the United Nations. As part of that participation, the UNPA authorizes the President to take steps necessary to implement Security Council Resolutions. Specifically, the UNPA, in 22 U.S.C. § 287c(a), provides as follows:
 
Notwithstanding the provisions of any other law, whenever the United States is called upon by the Security Council to apply measures which said Council has decided, pursuant to article 41 of said Charter, are to be employed to give effect to its decisions under said Charter, the President may, to the extent necessary to apply such measures, through any agency which he may designate, and under such orders, rules, and regulations as may be prescribed by him, investigate, regulate, or prohibit, in whole or in part, economic relations or rail, sea, air, postal, telegraphic, radio, and other means of communication between any foreign country or any national thereof or any person therein and the United States or any person subject to the jurisdiction thereof, or involving any property subject to the jurisdiction of the United States.
 
So, although this provision does permit the President to ban any means of communication with a foreign country it does so only “to the extent neccesary to apply such measure” as the Security Council “has decided … are to be employed to give effect to its decisions.”  It is not like the International Emergency Economic Powers Act which permits the President to declare a national emergency and then apply whatever measures the President wants limited only by the Berman Amendment’s informational materials and travel exception and the other specific exceptions set forth in the Act. Instead, it is limited to implementation of specific measures adopted by the Security Council.
 
So the issue here is whether the designation of IRGC through an order under E.O. 13224 is necessary to implement measures set forth in a Security Council Resolution and whether it is limited to actions that are “necessary” to implement those measures. First, of course, we have to look at UNSCR 2231, which repealed all prior Security Council Resolutions regarding Iran. This means that the designation of the IRGC in UNSCR 1747 has been terminated. In addition, UNSCR requires the E.U. to remove the IRGC from its list of designated entities. So nothing in any Security Council Resolution regarding Iran authorizes designation of the IRGC under the UNPA.
 
Nor is there anything in the Security Council Resolutions that are the basis of E.O. 13224 that support the designation of IRGC. Those resolutions are UNSCR 1214, 1267, 1333, and 1363. All of these Security Council Resolutions authorize measures taken against the Taliban in Afghanistan and have nothing to do with, and do not justify, a designation of the IRGC. The Executive Order also cited UNSCR 1269, although it does not explicitly claim authority from that resolution. UNSCR 1269 authorizes and encourages multilateral responses to terrorism and does not authorize a unilateral designation of IRGC as a terrorist, particularly after UNSCR 2231 lifted the UN’s designation of the IRGC and requires the E.U. to remove the IRGC from its lists.
 
Although cited by those now arguing that OFAC is correct that orders issued under E.O. 13224 are not subject to the Berman Amendment’s exceptions, the Ninth Circuit decision in Sacks v. Office of Foreign Assets Control does not permit that conclusion. The Ninth Circuit does say “IEEPA imposes no such burden on the President’s powers when he acts under the UNPA.” But Sacks is clearly not justification for OFAC’s claim here that the Berman Amendment to IEEPA does not apply to its designation of IRGC under E.O. 13224.
 
Sacks involved Executive Order 12722 which imposed a travel ban to Iraq pursuant to UNSCR 661. Of course, that travel ban was specifically required by UNSCR 661, which required member states to prohibit all transactions in Iraq other than those involving “medical or humanitarian purposes.” Clearly a travel ban could be considered a measure necessary to implement the specific restrictions of UNSCR. The same cannot be said for the designation of the IRGC which is not necessary to implement the UNSCR sanctions against the Taliban or the UNSCR resolution authorizing multilateral responses to terrorism.
 
Even though the UNPA doesn’t authorize the designation of the IRGC under E.O. 13224, there is little question that such a designation would be authorized under IEEPA.  Of course, that means that the exceptions in IEEPA, including its restrictions on embargoes of informational materials, would apply to any such designation.
* * * * * * * * * * * * * * * * * * * *

TEEX/IM TRAINING EVENTS & CONFERENCES

TE_a217
. Friday List of Approaching Events: 18 New Events Posted This Week

(Sources: Editor and Event Sponsors) 
 
Published every Friday or last publication day of the week. Please, send event announcements to
jwbartlett@fullcirclecompliance.eu
, composed in the below format:

# DATE: LOCATION; “EVENT TITLE;” SPONSOR; WEBLINK; CONTACT (email and phone number)


#” New listing this week  

 
Continuously Available Training:
 
* E-Seminars: “
US Export Controls” / “Defense Trade Controls
;” Export Compliance Training Institute;
danielle@learnexportcompliance.com
 
* E-Seminars: “ITAR/EAR Awareness;” Export Compliance Solutions; spalmer@exportcompliancesolutions.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:

 

* Oct 22-24: Grapevine, TX; “
Annual ICPA Fall Conference
;” International Compliance Professional Association;
Wizard@icpainc.org
 

* Oct 23-24: Arlington, VA; “
2017 Fall Advanced Conference
;” Society for International Affairs

*
 Oct 24-25: Cleveland, OH;
 
2017 Trade Compliance and Policy Seminar
; C.H. Robinson

*
 Oct 24: Rotterdam, the Netherlands; “
Awareness Training Export Control, Dual-Use, and Sanctions
” day 2/3 [in Dutch]; Fenex

# Oct 25: Manchester, UK; ”
Letters of Credit;” Institute of Export and International Trade

* Oct 25-26: Tysons Corner, VA;
ITAR Fundamentals; FD Associates

*
Oct 25: Haymarket, Australia; 
Defence Export Controls Sydney Outreach
; AU Department of Defense

* Oct 26: Coventry, UK;
Export Control Symposium; Midlands Aerospace Alliance and UK Department of International Trade

* Oct 26: London, UK; ”
US and UK Export Controls: A Basic Understanding;” Institute of Export and International Trade
# Oct 26: Burlington, Massachusetts; ”
Best Practices for Export Compliance Auditing and Oversight;” Massachusetts Export Center, 
617-973-8664

* Oct 30-Nov 2: Phoenix, AZ; “
ITAR Defense Trade Controls / EAR Export Controls Seminar
;” ECTI;
jessica@learnexportcompliance.com
; 540-433-3977

# Oct 31: Free Webinar; ”
ACE Advanced Reports;” U.S. Census Bureau

* Oct 31: Manchester, UK; “UK Strategic Export Controls: Intermediate Seminar;” Code loct2017; or contact Denise Carter at 020-7215-4459; UK Department for International Trade;

* Oct 31: Birmingham, UK; ”
Effective Incoterms – Half Day;” 
Institute of Export and International Trade

#
 Oct 31: London, UK; “
Advanced Financing of International Trade
;” 
Institute of Export and International Trade

# Nov 1: Fall River, Massachusetts; “Export Classification, Valuation, and Documentation;” Massachusetts Export Center, 617-973-8664

* Nov 1: Manchester, UK; “UK Strategic Export Controls: Beginner’s Workshop;” Code Bnov2017-1; or contact Denise Carter at 020-7215-4459; UK Department for International Trade; 
* Nov 1: Manchester, UK; “UK Strategic Export Controls: Licenses Workshop;” Code Lnov2017-1; or contact Denise Carter at 020-7215-4459; UK Department for International Trade; 
* Nov 1: Manchester, UK; “UK Strategic Export Controls: Control List Classification – Combined Dual Use and Military;” Code Cnov2017-1; or contact Denise Carter at 020-7215-4459; UK Department for International Trade;
# Nov 1: London, UK; “An Introduction to Exporting – Physical Goods;” Institute of Export and International Trade

# Nov 2: Webinar; “Understanding the New China Export Control Law;” Massachusetts Export Center, 617-973-8664

*
Nov 2: Webinar; “DIY Encryption Classification 2017 Edition;” ECTI; 540-433-3977
# Nov 2: London, UK; “Best Practices in Export – Swiss and U.K. Approaches;” Institute of Export and International Trade
* Nov 2-3: Las Vegas, NV; “The 22nd National M&A Institute;” American Bar Association 

* Nov 5-7: Singapore; ”
ICPA Singapore Conference;”
International Compliance Professionals Association;
wizard@icpainc.org
*
 Nov 6: Rotterdam, the Netherlands; “
Awareness Training Export Control, Dual-Use, and Sanctions
” day 3/3 [in Dutch]; Fenex

* Nov 6-8: Chicago, IL; “Basics of Government Contracting;” Federal Publications Seminars

# Nov 6-8: London, UK: “
Decoding Trade Controls, Sanctions, and Regulations on Dual-Use Goods;” Global Trade Controls

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

* Nov 8: London UK; ”
Control List Classification – Combined Dual Use and Military;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 
# Nov 8: London, UK; ”
Annual General Meeting of the Institute of Export & International Trade;” Institute of Export and International Trade
#
 Nov 8: London, UK; “
Member’s Annual Dinner
;” Institute of Export and International Trade
* Nov 8: Webinar; “
Introduction to the National Firearms Act
;” Reeves & Dola LLP; Teresa Ficaretta;
tficaretta@reevesdola.com
; 202-715-9183

# Nov 9: Westborough, Massachusetts; ”
Advanced International Letters of Credit;” Massachusetts Export Center, 
617-973-8664

* Nov 9: London UK; ”
Making Better Licence Applications;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Nov 9-10: Shanghai, China;ICPA China Conference;” International Compliance Professionals Association; wizard@icpainc.org

* Nov 9: Brussels, Belgium; ”
What European Companies Need to Know About U.S. Sanctions Export Controls, and FCPA Compliance;” Kelley Drye & Warren LLP

* Nov 9: Tysons Corner, VA; ITAR for the Empowered Official; FD Associates

* Nov 13: San Diego, CA; 
 “
Import Documentation and Procedures Seminar
;” International Business Training

* Nov 13-16: Wash DC; “ITAR Defense Trade Controls / EAR Export Controls Seminar;” ECTI; jessica@learnexportcompliance.com; 540-433-3977

* Nov 14-15; Schöllkrippen, Germany; ”
Fundamentals of Export Controls” (in German); FALEX
* Nov 14-15; Schöllkrippen, Germany; ”
Export Controls Refresher Course” (in German); FALEX
# Nov 15: Manchester, UK; ”
Post-Brexit Planning Workshop;” 

* Nov 15: Leeds, UK; ”
Intermediate Seminar;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Nov 16: Leeds, UK; ”
Beginners Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Nov 16: Leeds, UK; ”
Licenses Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Nov 16: Leeds, UK; ”
Control List Classification – Combined Dual Use and Military;” UK Department for International Trade  
denise.carter@trade.gsi.gov.uk 

* Nov 16: Nijkerk, the Netherlands; “Training Export Control” [in Dutch];

Fenedex

* Nov 16: Chicago, IL;
 “
Import Documentation and Procedures Seminar
;” International Business Training
* Nov 16-17; Schöllkrippen, Germany; “Workshop Export Controls” (in German); FALEX 

#
 Nov 17: Kowloon, Hong Kong; “Hong Kong-Japan Joint Industry Outreach Seminar on Strategic Trade Control;” Hong Kong Special Administrative Region Government

*
 Nov 17: Chicago, IL; “
Import Audit Compliance Seminar
;” International Business Training 
# Nov 22: London, UK; ”
International Documentation and Customs Compliance;” Institute of Export and International Trade
# 28-29 Nov: Munich, Germany; ”
US Defence Contracting and DFARS Compliance in Europe;” Institute of Export and International Trade

* Nov 29: Wash DC; ”
4th U.S. Customs Compliance Boot Camp, Washington, DC;” American Conference Institute
#
 Nov 30: Free Webinar; “
Exporting Vehicles to Canada
;
” U.S. Census Bureau

* Dec 4: NYC; ”
8th Annual New York Forum on Economic Sanctions, New York“, American Conference Institute

* Dec 4-7: Miami FL; “ITAR Defense Trade Controls / EAR Export Controls Seminar;” ECTI; jessica@learnexportcompliance.com; 540-433-3977
# Dec 5: Free Webinar; “ACE AESDirect Demonstration;” U.S. Census Bureau

* Dec 5: Webinar; ”
NAFTA Rules of Origin;” International Business Training

* Dec 5: Brussels, Belgium; ”
Dual Use For Beginners
” [In Dutch]; Flemish Department of Foreign Affairs

* Dec 5: San Juan, PR; “AES Compliance Seminar in Spanish;” Dept. of Commerce/Census Bureau;

itmd.outreach@census.gov

* Dec 5-6: New York, NY; ”
8th Annual Forum on Economic Sanctions;” American Conference Institute 

* Dec 6: London UK; ”
Intermediate Seminar;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Dec 6: Webinar; ”
Introduction to Firearms and Ammunition Excise Tax (FAET);” Reeves & Dola LLP; Teresa Ficaretta;
tficaretta@reevesdola.com; 202-715-9183

* Dec 6: Wood Ridge, NJ; “
AES Compliance Seminar
;” 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 7: London UK; ”
Beginners Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Dec 7: London UK; ”
Licences Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Dec 8: Boston, MA; ”
Export Expo;” Compliance Alliance and Massachusets Export Center
* Dec 8: Minneapolis, MN; 

Incoterms 2010: Terms of Sale Seminar
;” International Business Training
* Dec 8: Washington, D.C.; ”
2017 SIA Holiday Party;” Society for International Affairs (SIA)

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

* Dec 12: London UK; ”
Control List Classification – Combined Dual Use and Military;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Dec 13: Washington, DC; “DDTC In-House Seminar;”

*
 Dec 14: Minneapolis, MN; “
Import Audit Compliance Seminar
;” International Business Training 

* Dec 15: Atlanta, GA; ”
Incoterms 2010: Terms of Sale Seminar;” International Business Training


* Dec 19: Brussels, Belgium; ”
2017 Export Control Forum;” European Commission

 
2018
 

* Jan 17: Bristol UK; ”
Intermediate Seminar;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Jan 18: Bristol UK; ”
Beginners Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Jan 18: Bristol UK; ”
Licences Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Jan 18: Bristol UK; ”
Control List Classification – Combined Dual Use and Military;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Jan 22-25: San Diego CA; “
ITAR Defense Trade Controls / EAR Export Controls Seminar
;” ECTI; 
jessica@learnexportcompliance.com
; 540-433-3977


Jan 29-30: Toronto, Canada;
7th Industry Forum on Export and Re-Export Compliance for Canadian Operations;”
American Conference Institute
* Jan 31: Washington, D.C.; “4th National Forum on CFIUS and Team Telecom;” American Conference Institute

* Feb 6: Las Vegas, NV;
 “
Import Documentation and Procedures Seminar
;” International Business Training

* Feb 13-14: Orlando FL; “
ITAR/EAR Boot Camp
;” Export Compliance Solutions; 
spalmer@exportcompliancesolutions.com
; 866-238-4018

* Feb 19-22: Huntsville AL; “
ITAR Defense Trade Controls / EAR Export Controls Seminar
;” ECTI; 
jessica@learnexportcompliance.com
; 540-433-3977

* Feb 21: Newcastle UK; ”
Intermediate Seminar;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Feb 22: Newcastle UK; ”
Beginners Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Feb 22: Newcastle UK; ”
Licences Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Feb 22: Newcastle UK; ”
Control List Classification – Combined Dual Use and Military;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Mar 5-7: Sugar Land, TX; ”
2018 Winter Basics Conference;” Society for International Affairs (SIA)
* Mar 6-8: Orlando, FL; “
‘Partnering for Compliance’ East Export/Import Control Training and Education Program
;” Partnering for Compliance
* Mar 9: Dallas, TX; “Customs/Import Boot Camp;” Partnering for Compliance 
* Mar 11-14: San Diego, CA; “ICPA Annual Conference;” International Compliance Professionals Association; wizard@icpainc.org

* Mar 14-15: Austin, TX; “
Establishing an ITAR/EAR Export Compliance Program
” Export Compliance Solutions;
spalmer@exportcompliancesolutions.com
;
866-238-4018 

* Mar 14: Birmingham UK; ”
Intermediate Seminar;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Mar 15: Birmingham UK; ”
Beginners Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Mar 15: Birmingham UK; ”
Licences Workshop;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Mar 15: Birmingham UK; ”
Control List Classification – Combined Dual Use and Military;” UK Department for International Trade;
denise.carter@trade.gsi.gov.uk 

* Apr 16-19: Las Vegas NV; “
ITAR Defense Trade Controls / EAR Export Controls Seminar
;” ECTI; 
jessica@learnexportcompliance.com
; 540-433-3977
* Apr 30-May 3: Wash DC; “
ITAR Defense Trade Controls / EAR Export Controls Seminar
;” ECTI; 
jessica@learnexportcompliance.com
; 540-433-3977

* May 6-8: Toronto, Canada; ”
2018 ICPA Canadian Conference;” ICPA
* May 7-8: Denver, CO; ”
2018 Spring Advanced Conference;” Society for International Affairs (SIA)

* May 16-17: National Harbor, MD; “
ITAR/EAR Compliance: An Industry Perspective
;” Export Compliance Solutions;
spalmer@exportcompliancesolutions.com
;
 866-238-4018 

* Jul 10-11: Long Beach, CA; ”
ITAR/EAR Boot Camp;”  Export Compliance Solutions; 
spalmer@exportcompliancesolutions.com
; 866-238-4018

* Sep 12-13: Annapolis, MD; “ITAR/EAR Boot Camp;” Export Compliance Solutions; spalmer@exportcompliancesolutions.com; 866-238-4018

*
Oct 22-23; Arlington, VA; “2018 Fall Advanced Conference;” Society for International Affairs (SIA)

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

ENEDITOR’S NOTES

EN_a11
8. Bartlett’s Unfamiliar Quotations

(Source: Editor)

 
* John Dewey (20 Oct 1859 – 1 Jun 1952; was an American philosopher, psychologist, and educational reformer whose ideas have been influential in education and social reform. Although Dewey is known best for his publications about education, he also wrote about epistemology, metaphysics, aesthetics, art, logic, social theory, and ethics. He was a major educational reformer for the 20th century. The “Dewey decimal system” of library classification, however, was invented in 1876 by Melvil Dewey, unrelated to John Dewey.)
  – “Arriving at one goal is the starting point to another.”
 
*  Stanislaus I (Stanisław I Leszczyński; 20 Oct 1677 – 23 Feb 1766; was King of Poland, Grand Duke of Lithuania, Duke of Lorraine, and a count of the Holy Roman Empire.)
  – “To believe with certainty we must begin with doubting.”
 
* Samuel Taylor Coleridge (21 Oct 1772 – 25 Jul 1834; was an English poet, literary critic, philosopher and theologian who wrote the poems The Rime of the Ancient Mariner and Kubla Khan, as well as the major prose work Biographia Literaria
  – “Advice is like snow – the softer it falls, the longer it dwells upon, and the deeper it sinks into the mind.” 
  – “Nothing is so contagious as enthusiasm.”
 
Friday funnies: 
 
A duck walks into a bar wearing a hard hat, safety vest, and tool belt. He sits down at the bar and says to the bartender, “I’ll have a beer.” Flabbergasted, the bartender pours a beer and hands it to the duck. He downs and orders another. The bartender can’t believe what he’s witnessing, but pours another and watches as the duck downs it in one gulp. “Where’re you from?” asks the barkeep. “Construction site across the street. One more please, and I’ll be on my way.” Pouring a third, the bartender asks the duck, “Wow!. Do you know how much money you could make in the circus?” “Circus?” the duck chugs the last beer, then asks, “What would the circus want with a bricklayer?”
  — Chris Connelly, Urbandale, Iowa

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

EN_a219. 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: 28 Sep 2017: 82 FR 45366-45408: Changes to the In-Bond Process [Effective Date: 27 Nov 2017.] 
 
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 cancelled Supp. 1 to the NISPOM (Summary 
here
.)


EXPORT ADMINISTRATION REGULATIONS (EAR): 15 CFR Subtit. B, Ch. VII, Pts. 730-774 

  – Last Amendment:
3 Oct 2017: 82 FR 4 5959-45962: Updated Statements of Legal Authority for the Export Administration Regulations

  

FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
 
 – Last Amendment: 16 Jun 2017: 82 FR 27613-27614: Removal of Burmese Sanctions Regulations 
 

FOREIGN TRADE REGULATIONS (FTR): 15 CFR Part 30
  –
Last Amendment: 
20 Sep 2017:
 
82 FR 43842-43844
: Foreign Trade Regulations (FTR): Clarification on Filing Requirements; Correction
  
  – HTS codes that are not valid for AES are available 
here.
  – The latest edition (20 Sep 2017) 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: 20 Oct 2017: 
Harmonized System Update 1707, c
ontaining 
27,291 ABI records and 5,164 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.
  – Last Amendment: Last Amendment: 30 Aug 2017: 82 FR 41172-41173: Temporary Modification of Category XI of the United States Munitions List
  – The only available fully updated copy (latest edition: 12 Sep 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 800 footnotes containing amendment histories, 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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EN_a320
. Weekly Highlights of the Daily Bugle Top Stories

(Source: Editor)
 

Review last week’s top Ex/Im stories in “Weekly Highlights of Daily Bugle Top Stories” posted here.

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

* The Ex/Im Daily Update is a publication of FCC Advisory B.V., compiled by: Editor, James E. Bartlett III; Assistant Editors, Alexander P. Bosch and Vincent J.A. Goossen; and Events & Jobs Editor, John Bartlett. The Ex/Im Daily Update is 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.

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