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18-0213 Tuesday “Daily Bugle”

18-0213 Tuesday “Daily Bugle”

Tuesday, 13 February 2018

TOP
The Daily Bugle is a free daily newsletter from Full Circle Compliance, containing changes to export/import regulations (ATF, DOE/NRC, Customs, NISPOM, EAR, FACR/OFAC, FAR/DFARS, FTR/AES, HTSUS, and ITAR), plus news and events.  Subscribe 
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[No items of interest noted today.] 

  1. Items Scheduled for Publication in Future Federal Register Editions
  2. Commerce/BIS: (No new postings.)
  3. DHS/CBP Updates CATAIR Document Concerning ACE Extract Reference Query
  4. DoD/DSCA Posts Policy Memo 18-11
  5. State/DDTC Posts Name and Address Change for GSI Group Europe GmbH
  6. Treasury/OFAC Posts Quarterly Reports of Licensing Activities
  7. EU Updates Information Note for EU Businesses Operating in Crimea and Sevastopol
  1. Expeditors News: “House Ways and Means Committee Introduces Bill to Reinstate GSP”
  2. ST&R Trade Report: “CBP Pursuing Numerous Initiatives to Facilitate Trade, Officials Say”
  1. M. O’Kane: “UK Export Control (Amendment) Order 2018”
  2. M. Volkov: “Federal Reserve Hits Wells Fargo with Unprecedented Enforcement Action (Part I of II)”
  3. N. Dahlvang: “State and Commerce Departments Request Comments on USML Categories V, X, and XI and Related ECCNs”
  4. Ropes & Gray: “Globalizing Your Compliance Program”
  5. Gary Stanley’s ECR Tip of the Day
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Amendments: ATF (15 Jan 2016), Customs (8 Dec 2017), DOD/NISPOM (18 May 2016), EAR (26 Jan 2018), FACR/OFAC (28 Dec 2017), FTR (20 Sep 2017), HTSUS (8 Feb 2018), ITAR (19 Jan 2018) 
  3. Weekly Highlights of the Daily Bugle Top Stories 

EXIMITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a1


[No items of interest noted today.]

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OGSOTHER GOVERNMENT SOURCES

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

* Commerce; Industry and Security Bureau; NOTICES; Denials of Export Privileges: Justin Gage Jangraw [Publication Date: 14 February 2018.]
 
* State; RULES; International Traffic in Arms: South Sudan [Publication Date: 14 February 2018.]
 

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(Source:
CSMS #18-000133, 13 Feb 2018.)
 
The following CATAIR document has been updated to remove the Zip Code extract capability from the ACE Extract Reference Query and can be found under the “Chapters: Drafts for Future Capabilities” tab on the CATAIR homepage of CBP.gov.
 
Software changes for this have an anticipated Production date of March 17, 2018; and Certification date of March 13th.
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(Source:
DoD/DSCA, 13 Feb 2018.)
 

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(Source:
State/DDTC, 12 Feb 2018.) [Excerpts.]
 
Effective immediately, GSI Group Europe GmbH, Muenchner Strasse 2a, 82152 Planegg, Germany will change as follows: Novanta Europe GmbH, Parkring 57-59, 85748 Garching, Germany. 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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(Source:
Treasury/OFAC, 13 Feb 2018.) 
 
OFAC is publishing Quarterly Reports of Licensing Activities pursuant to Section 906(b) of the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA), covering activities undertaken by the Treasury Department’s Office of Foreign Assets Control (OFAC) under Section 906(a)(1) of the TSRA from October 2016 through December 2017.  Under the procedures established in its TSRA-related regulations, OFAC processes license applications requesting authorization to export agricultural commodities, medicine, and medical devices to Iran and Sudan under the specific licensing regime set forth in Section 906 of the TSRA.
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The EU has updated its note on restrictive measures in line with the non-recognition policy of the illegal annexation of Crimea/Sevastopol.
 
The set of measures was first introduced in 2014 and consists, among others, of an investment ban and a prohibition of export of goods in certain sectors. 
 
To facilitate the compliance of EU businesses with these restrictive measures and other elements of the non-recognition policy, the EU has published an information note to EU business operating and/or investing in Crimea/Sevastopol. The new version of this note includes updates about relevant regulations as well as more information about precautions to take when doing business in the region. 
 

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NWSNEWS

NWS_a1
8. Expeditors News: “House Ways and Means Committee Introduces Bill to Reinstate GSP”

(Source: Expeditors News, 13 Feb 2018.)
 
On February 8, 2018, the House Ways and Means Committee chairman and ranking member introduced legislation to provide for a three-year renewal of the Generalized System of Preferences (GSP) program.
 
The proposed legislation will allow the program to extend through December 31, 2020 and will retroactively extend benefits to covered imports made during the lapse.
 
The Ways and Means Committee press release can be found here.

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NWS_a29. ST&R Trade Report: “CBP Pursuing Numerous Initiatives to Facilitate Trade, Officials Say”
 
U.S. Customs and Border Protection officials say that while the agency gets more attention for its trade enforcement efforts it is taking a number of steps to facilitate trade at U.S. borders as well. Following are some of the current and planned initiatives in this area.
 
Unified Cargo Processing
. Under UCP, U.S. and Mexican customs officials conduct joint inspections of cargo inside the importing country. Facilities and processes are shared and the law of the host country prevails. At each site the pilot is first rolled out to highly compliant companies and then gradually expanded. In addition, each site is testing UCP with respect to specific categories of goods.
 
Officials say UCP has already achieved significant reductions in wait times and yielded substantial savings for traders. The pilot is also changing the way enforcement agencies operate and how companies do business, officials say, such as by shifting shipping times.
 
UCP is currently being tested at approximately a dozen locations in both the U.S. and Mexico. Many of these are truck processing facilities along the border, but some airports and rail facilities are involved as well. The pilot was also recently expanded to rail operations at the port of Champlain, N.Y., along the U.S.-Canada border.
 
Moving forward, officials say they plan to extend UCP to additional locations as well as different types of locations, such as express delivery facilities. However, sufficient infrastructure will be needed to allow the program to work properly, which could pose a challenge at some sites. In the future, new border facilities will be designed with evolving technology and joint inspections in mind.
 
AQUA Lane
. CBP has deployed to all U.S. seaports the Advanced Qualified Unlading Approval program, which allows CTPAT-validated ocean carriers that are also compliant with importer security filing and certain agriculture requirements to unlade goods immediately upon arrival in port. All containers must be delivered directly to a CTPAT terminal operator. CBP officials say this program has saved carriers hundreds of millions of dollars as they can better predict unlading times for labor cost purposes and realize lower costs for fuel, dockage fees, etc.
 
Non-Intrusive Inspection
. CBP has hundreds of large-scale NII systems deployed to and in between U.S. ports of entry. These systems enable CBP officers to examine cargo conveyances such as sea containers, commercial trucks, and rail cars for the presence of contraband without physically opening or unloading them.
 
CBP also scans all arriving conveyances and containers with radiation detection equipment, which includes radiation portal monitors, radiation isotope identification devices, and personal radiation detectors. Utilizing RPMs, CBP is able to scan approximately 100 per cent of all mail and express consignment mail/parcels, approximately 100 percent of all truck cargo, 100 percent of personally-owned vehicles arriving from Canada and Mexico, and approximately 99 percent of all arriving sea-borne containerized cargo for the presence of radiological and nuclear materials.
 
Officials say CBP has recently recalibrated its RPMs, which has decreased the number of false positive readings and the associated delays. CBP is also preparing to pilot test at two southwest border locations a variable intensity scanner that will eliminate the need for drivers to exit their trucks, which should allow CBP to process about ten times as many trucks per hour.
 
Vessel Clearance
. According to CBP officials, seven or eight forms are currently required to clear an inbound cargo vessel, a manual process than can take up to two hours. Although this process does not affect the cargo itself, it can delay cargo delivery times. CBP began working to automate this process in 2015 and has now completed a majority of the work, officials said, with plans to run pilot test at several locations sometime this year. CBP is also in the process of revamping its vessel-related regulations to eliminate duplicative requirements.

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COMMCOMMENTARY

COMM_a01
10. M. O’Kane: “UK Export Control (Amendment) Order 2018”
(Source: European Sanctions Blog, 12 Feb 2018.)
 
* Author: Michael O’Kane, Esq., Peters & Peters Solicitors LLP, mokane@petersandpeters.com.
 
The new Export Control (Amendment) Order 2018, SI 2018/165, comes into force on 5 March 2018.  This amends Schedule 2 to the Export Control Order 2008, SI 2008/3231, (which lists military goods, software and technology subject to export controls) in order to implement Commission Directive (EU) 2017/2054, amending Directive 2009/43/EC of the European Parliament and of the Council as regards the list of defence-related products.

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COMM_a2
11. M. Volkov: “Federal Reserve Hits Wells Fargo with Unprecedented Enforcement Action (Part I of II)”
(Source: Volkov Law Group Blog, 12 Feb 2018. Reprinted by permission.)
 
* Author: Michael Volkov, Esq., Volkov Law Group, mvolkov@volkovlaw.com, 240-505-1992.
 
n an extraordinary action, with significant ramifications for the financial industry, the Federal Reserve recently announced a series of enforcement actions against Wells Fargo.
On Friday, February 2, 2018, which was then-Chairwoman Yellen’s last day in office, the Federal Reserve announced an enforcement action against Wells Fargo for its corporate governance failures and poor record of remediation. (The Press Release and Enforcement Documents are Here).
 
Specifically, the Federal Reserve and Wells Fargo entered into a Consent Order reflecting the Federal Reserve’s dissatisfaction with Wells Fargo’s board of directors’ performance, risk management practices and its compliance program.
 
In particular, the Federal Reserve noted the Consent Orders previously issued by the Office of the Comptroller and the Consumer Financial Protection Bureau focused on Wells Fargo commercial bank sales practices and risk management.  Also, it noted that, in recent months, Wells Fargo had charged hundreds of thousands of borrowers for unneeded guaranteed auto protection or collateral protection insurance.  Additionally, the Federal Reserve identified deficiencies in Wells Fargo’s risk management and compliance program which Wells Fargo has yet to correct.
 
As a result, the Consent Order lays out a comprehensive remediation plan that requires Wells Fargo to address its board of directors and governance deficiencies, problems with its risk management operations and its compliance program.
In perhaps the most extraordinary aspect of the enforcement action, the Federal Reserve restricted Wells Fargo’s ability to grow its business until the remedial actions are completed.  Specifically, Wells Fargo cannot take any action that would cause the average of its total consolidated assets to increase over the same quarter’s total consolidated assets for the year 2017.
 
The restrictions will remain in place until: (1) Wells Fargo submits the written plans to improve the Board’s effectiveness and Risk Management; (2) the Federal Reserve approves the written plans; (3) the Bank adopts and implements the plans and programs and the Initial Risk Management Review is completed to the Federal Reserve’s satisfaction; and (4) the Federal Reserve provides written notice that the above 3 conditions have been met.
 
It is worthwhile to take a step back and remember how Wells Fargo ended up here in this fine mess.
 
Under a Wells Fargo sales incentive program, local managers and bank officers were required to meet stringent sales targets built on the assumption of eight accounts (e.g. checking, credit card, cds) for each customer. As a result, Wells Fargo personnel created nearly 2 million (yes, two million) fake accounts to meet these ridiculous sales targets.
 
After much hand-wringing and delays, Wells Fargo’s board launched a major internal investigation of the incident, including serious issues raised about its handling of whistleblowers, several of whom were fired after raising concerns about the program.
The Independent Directors in April 2017 issued a scathing report around the Wells Fargo scandal.  Based on its findings, Wells Fargo’s independent board took steps to clawback an additional $75 million from former CEO Stumpf and head of Community Banking Carrie Tolstedt for sales abuses resulting from the sales incentives program.
 
The directors found that the root cause of the sales practice failures was a decentralized management structure, coupled with an aggressive sales program directed and controlled by senior management in the Community Banking operation. As a result, employees sold unwanted and even unauthorized accounts to customers to meet management sales targets.
The Federal Reserve’s Consent Order requires Wells Fargo in 60 days to submit three separate written plans.
 
The first is to improve its Board of Directors effectiveness.
 
The second is to improve its firm wide compliance and operational risk management program.
 
The third requires Wells Fargo to conduct and complete by September 30, 2018 an independent review of its Board’s improvements in effective oversight and governance and enhancements to its compliance and operational risk management program.
 
Following the integration of the improvements required by the Order, the Bank is required to conduct a second independent review to assess the efficacy and sustainability of the improvements.  The Federal Reserve shall approve the third-party expert required to conduct the review.
 
For other major banks under regulatory supervision, the Wells Fargo action is a major development and indication that the government will intervene when necessary to ensure proper governance and compliance actions are taken, and that remediation is enacted quickly and effectively in the aftermath of a scandal.

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COMM_a3
12. N. Dahlvang: “State and Commerce Departments Request Comments on USML Categories V, X, and XI and Related ECCNs”
(Source: Export Compliance Solutions, 13 Feb 2018.)
 
* Author: Nick Dahlvang, Export Compliance Solutions, nick@exportcompliancesolutions.com.
 
State Department Request for Comments
 
On February 2, the Department of State published a notice (83 FR 5970) seeking comments on the following topics as they relate to U.S. Munitions List (USML) Categories V (Explosives and Energetic Materials, Propellants, Incendiary Agents, and Their Constituents), X (Personal Protective Equipment), and XI (Military Electronics). Specifically, the notice requests comments on the following issues:
 
  (1) Emerging and new technologies that are appropriately controlled by one of the referenced categories, but which are not currently described in subject categories or not described with sufficient clarity.
 
  (2) Defense articles that are described in subject categories, but which have entered into normal commercial use since the most recent revisions to the category at issue. For such comments, be sure to include documentation to support claims that defense articles have entered into normal commercial use.
 
  (3) Defense articles for which commercial use is proposed, intended, or anticipated in the next 5 years.
 
  (4) Drafting or other technical issues in the text of all of the referenced categories.
 
  (5) Comments regarding USML Category XI paragraph (b) modification.
 
  (6) Potential cost savings to private entities from shifting control of specific commercial items from USML to the Export Administration Regulations. To the extent possible, please quantify the cost of compliance with USML control of commercial items, to include the time saved, the reduction in paperwork, and any other cost savings for a particular change.
 
Comments may be submitted by internet at www.regulations.gov (Docket No. DOS-2017-0017) or by email to DDTCPublicComments@ state.gov through April 13, 2018. Comments will be published and should not include proprietary or other sensitive information.
 
For the current USML categories, click here.
 
Commerce Department Request for Comments
 
In a related notice (83 FR 5968), the Department of Commerce requests comments on the following Commerce Control List (CCL) ECCNs (Export Control Classification Numbers): energetic materials (1B608, 1C608, 1D608 and 1E608); armored and protective equipment (1A613, 1B613, 1D613, 1E613); military electronics (3A611, 3B611, 3D611 and 3E611); and cryogenic and superconducting equipment (9A620, 9B620, 9D620 and 9E620). Specifically, the notice requests comments on the efficacy of the previous revisions, how to improve the implementation of these 600 series items on the CCL, and the potential cost savings of shifting control of these specific items from the USML to the CCL.
 
Comments may be submitted by internet at www.regulations.gov (Docket No BIS-2018-0004) through April 13, 2018. Comments will be published and should not include proprietary or other sensitive information.
 
For the current CCL categories click here.

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COMM_a4
13. Ropes & Gray: “Globalizing Your Compliance Program”

(Source: Ropes & Gray LLP, 29 Jan 2018.)
 
I. Legal Consequences of an Inadequate Compliance Program
 
Multinational companies continue to face intense enforcement scrutiny related to their global compliance practices by oversight authorities worldwide. These companies rely heavily on local regulatory developments, evolving statutory structures such as the Foreign Corrupt Practices Act (“FCPA”) and UK Bribery Act, and trends raised by Deferred Prosecution Agreements (“DPAs”) and enforcement settlements for guidance on implementing an effective global compliance program. As recent U.S. settlements involving Orthofix, Teva Pharmaceuticals, and Olympus indicate, domestic companies that fail to adequately train, monitor, and audit compliance for ex-U.S. operations are particularly subject to intense scrutiny-each of these companies recently entered into DPAs related to FCPA allegations and settled with the U.S. Department of Justice (“DOJ”) or Securities Exchange Commission (“SEC”) for amounts ranging from $6 million (Orthofix) to $646 million (Olympus). In each case, the government found that compliance program implementation, oversight, and training were insufficient to prevent improper (and even overtly corrupt) conduct. [FN/1] Moreover, in the case of Teva, the DOJ found that compliance personnel were “unable or unwilling” to implement its anti-corruption programs, and for Olympus, the DOJ criticized the lack of an anti-corruption “tone at the top.” Accordingly, the DOJ and SEC are requiring health care companies conducting ex-U.S. operations to do more than just “check the boxes” in establishing a compliance program-an effective compliance program requires on-the-ground and executive commitment. The most effective programs establish institutional commitment at the very outset and require ongoing monitoring and continuous updates. Companies that internally identify and self-report (when appropriate) material non-compliance with applicable legal mandates can significantly decrease the risk of regulator-imposed compliance counsel or monitorships, mitigate the threat of substantial monetary penalties, and potentially avoid other adverse consequences, such as exclusion from U.S.-based health care programs, disqualification from government contracts, and widespread reputational harm.
 
II. Globalizing Your Compliance Program
 
Organizations implementing effective global compliance programs face particular challenges in navigating disparate regulatory regimes in the numerous jurisdictions in which they may operate. Maintaining and updating regional or country-specific policies and program oversight procedures requires substantial resources and continuous updates. Faced with these challenges, some multinational companies implement uniform global compliance policies that may include requirements that are more or less restrictive than local laws. Others develop policies that identify areas of regulatory overlap and apply some consistent standards globally, and then supplement with country-specific guidance that accounts for variation in local law. [FN/2] To account for the disparate requirements in the various jurisdictions in which a company may operate, global organizations can develop analytic tools in order to identify and prioritize high-risk areas based upon locality. From there, global organizations can target these items for improvement through heightened training and monitoring programs. High-risk topics for global organizations to consider monitoring may include T&E; third-party due diligence; interactions with government entities; interactions with health care professionals; grants, donations, and sponsorships; and free product and price concessions. [FN/3]
 
The DOJ recently offered guidance relevant to an increasingly globalized market and the unique compliance requirements associated with multinational business operations in its 2017 Evaluation of Corporate Compliance Programs guidance. [FN/4] The guidance emphasizes key elements and controls applicable to global compliance program operations, such as accessibility of policies and procedures, whether a company provides “gatekeepers” (persons with payment authority in applicable jurisdictions) clear guidance and training, and how the company uses incentives to promote ethical conduct. In addition, confidential reporting, risk assessment, auditing and control testing are emphasized as integral compliance processes. The U.S. Department of Health and Human Services, Office of the Inspector General (“OIG”) has also issued compliance guidance applicable to health care and life sciences companies, which may be useful to companies in these sectors. [FN/5]
 
All of the traditional “seven elements” of compliance programs should be designed to meet evolving global requirements, such as policies and procedures; oversight; employee and third-party screening; training and communication; auditing, monitoring and internal reporting; disciplinary actions and incentives; and investigations and remediation. [FN/6] When developing training programs, companies should tailor presentations and materials to the roles of its workforce members, and policies and training should be presented in local languages and in person, to the extent possible, with real-world examples. Regulatory oversight bodies consistently demand that compliance programs evolve to meet developing statutory structures and industry standards, identify risks through internal monitoring, and promptly implement effective corrective action plans. Specific local requirements, such as meal or gift limits, are often best built into localized standard operating procedures and should be tied to other systems (i.e., expense control systems) in order to both facilitate with compliance tracking efforts and, to the extent possible, act as a stop-gap for instances of non-compliance. For example, companies operating in South Korea and Brazil require specific focus and robust monitoring for recently enacted laws imposing spending restrictions more burdensome than under the FCPA: South Korea’s “Kim Young-ran Act” sets a threshold for improper payments to public officials (whereas the FCPA prohibits certain payments regardless of amount), and includes a broader definition of public officials to encompass certain private actors, and Brazil’s “Clean Companies Act” applies strict liability to interactions with public officials.
 
Establishing effective communications and audit processes between headquarters and regional business lines are essential for establishing accountability within global organizations. A centralized audit process is germane to an effective business model-multinational companies are advised, however, to consider implementing periodic audits as close to the ground as possible as well, to monitor training effectiveness and implementation. Single-country and even regional audits substantially increase the likelihood of identifying instances of noncompliance. Throughout the process, multinational companies should maintain strong communication channels so that if the company identifies a risk at the local level, headquarters can assess whether the problem exists elsewhere at the regional level or across multiple business lines, and can then continue to target these risks through updated training and monitoring initiatives.
 
Health care companies and institutions must be proactive in their review of the specific requirements associated with cross-jurisdictional operations and deployment of institutional and local oversight mechanisms. Such efforts will help meet the evolving expectations of regulatory and enforcement agencies to operate a risk-based, global compliance program.
 
————-

  [FN/1] In the Teva settlement, the DOJ noted that the Company found FCPA violations through an internal audit, but failed for years to implement training around these issues. Department of Justice, Teva Pharmaceutical Industries Ltd. Agrees to Pay More than $283 Million to Resolve Foreign Corrupt Practices Act Charges,
available here; in the Olympus settlement, the DOJ found that Olympus failed to appoint a compliance officer until 2009. Department of Justice, Medical Equipment Company Will Pay $646 Million for Making Illegal Payments to Doctors and Hospitals in United States and Latin America, 

available here


  [FN/2] In a recent survey of participants in a webinar on global compliance, including compliance officers and counsel for several multinational companies in various sectors, 64% of respondents indicated that they used global policies that set minimum standards with additional local SOPs, 4% used global policies with less strict local SOPs, and 32% used a code of conduct and all local policies/SOPs. 
  [FN/3] Based on a global survey of 300 senior-level executives working for multinational businesses in North America, EMEA, Asia Pacific and Latin America, in the health care, life sciences, asset management, banking, private equity and technology sectors (the “Risky Business Survey”), health care and life sciences companies identify regulation/compliance (62%), intellectual property (26%) and anti-money laundering (24%) and sanctions/export controls (24%) as high-risk topics for which they are least prepared, and therefore may require strengthened monitoring programs. More information
available here
  [FN/4] Evaluation of Corporate Compliance Programs, February 2017, Department of Justice, available
here.  
  [FN/5] Measuring Compliance Program Effectiveness: A Resource Guide, March 27, 2017, Department of Health and Human Services, Office of Inspector General (OIG), pp. 24-31. While the OIG’s compliance guidance includes similar themes present in the 2017 DOJ guidance, it provides more targeted, tactical content governing
domestic conduct. 
  [FN/6] See United States Sentencing Commission,
Guidelines Manual, 18 U.S.C.A. §8B2.1 (November 1, 2016).

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COMM_a5
14. Gary Stanley’s ECR Tip of the Day
(Source: Defense and Export-Import Update, 13 Feb 2018; available by subscription from
gstanley@glstrade.com
)
 
* Author: Gary Stanley, Esq., Global Legal Services, PC, (202) 352-3059,
gstanley@glstrade.com
.
 
When reporting a cyber incident under DFARS clause 252.204-7012, or under DFARS clause 252.239-7010, Cloud Computing Services, the contractor will access the DIBNet portal (
http://dibnet.dod.mil) and complete the fields in the Incident Collection Format (ICF). Access to this form requires a DoD-approved medium assurance public key infrastructure (PKI) certificate. In the event a company does not have anyone with a DoD approved medium assurance certificate, they may contact the DoD Cyber Crime Center (DC3) (contact information is also on the portal) for additional information. The DIBNet portal is DoD’s single reporting mechanism for DoD contractor reporting of cyber incidents on unclassified information systems. The rule streamlines the reporting processes for DoD contractors and minimizes duplicative reporting processes.

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ENEDITOR’S NOTES

 
* Robert Jackson: (Robert Houghwout Jackson, 13 Feb 1892 – 9 Oct 1954; was an American attorney and judge who served as an Associate Justice of the United States Supreme Court. Jackson was admitted to the bar through a combination of reading law with an established attorney, and attending law school, at Albany Law School, New York. He is the most recent justice without a law degree to be appointed to the Supreme Court. Jackson is well known for his aphorism describing the Supreme Court, “We are not final because we are infallible, but we are infallible only because we are final.”)
  – “It is not the function of the government to keep the citizen from falling into error; it is the function of the citizen to keep the government from falling into error.”
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EN_a316
. 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.  The latest amendments 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: 8 Dec 2017: 82 FR 57821-57825: Civil Monetary Penalty Adjustments for Inflation
 
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: 26 Jan 2018: 83 FR 3577-3583: Addition of Certain Entities; Removal of Certain Entities; and Revisions of Entries on the Entity List

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders
  – Last Amendment: 28 Dec 2017: 
82 FR 61450-61451: Iraq Stabilization and Insurgency 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 (1 Jan 2018) 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, Census/AES guidance, and to many errors contained in the official text. 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 2018: 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: 8 Feb 2018: 83 FR 5674: Technical Corrections to the Harmonized Tariff Schedule of the United States [Concerns HTSUS Chapter 99, Subchapter III]

  – 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: 19 Jan 2018: 83 FR 2738: Department of State 2018 Civil Monetary Penalties Inflationary Adjustment; Correction
  – The only available fully updated copy (latest edition: 19 Jan 2018) 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_a0317
Weekly Highlights of the Daily Bugle Top Stories

(Source: Editor) 

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

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EPEDITORIAL POLICY

* 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, DOE/NRC, DOJ/ATF, DoD/DSS, DoD/DTSA, FAR/DFARS, 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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