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18-0301 Thursday “Daily Bugle”

18-0301 Thursday “Daily Bugle”

Thursday, 1 March 2018

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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: Trilogy International Associates, Inc., of Altaville, CA, and William Michael Johnson of Angels Camp, CA, to Pay Each $100,000 for Export Violations
  3. Commerce/NIST Updates Special Publication 800-171 Rev. 1 on Protecting CUI in Nonfederal Systems and Organizations
  4. DHS/CBP Posts Revised External ACE Entry Summary Business Process Document
  5. DHS/CBP Posts Update on TFTEA Drawback Policy
  6. State/DDTC Reminder: DTrade Super Users Need to Update their Email Address in the System
  7. Treasury/OFAC Amends and Reissues North Korea Sanctions Regulations
  8. Australia DFAT: “Exporters Embrace Australia’s Trade Agreements”
  1. Azernews: “Uzbek President Approves New Export Control System”
  2. The Jerusalem Post: “Fear of U.S. Sanctions Ends German Companies Fueling Iranian FM’s Plane”
  3. ST&R Trade Report: “ACE Downtime Procedures Issued as CBP Works to Minimize Outages”
  4. WorldECR News Alert of 1 Mar
  1. K.C. Georgi, R.K. Alberda & L. Hardaway: “What Are the Risks of Doing Business with the Russian Oligarchs List and the Russian Defense/Intelligence List?”
  2. M. Volkov: “Three Critical Questions to Ask Your CEO About Your Ethical Culture”
  3. R.C. Thomsen II, A.D. Paytas, & M.M. Shomali: “Changes to Export Controls in Feb 2018”
  4. Gary Stanley’s ECR Tip of the Day
  1. ECS Announces “ITAR/EAR Beyond the Basics” on 20-21 Mar in San Diego, CA 
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Amendments: ATF (15 Jan 2016), Customs (22 Feb 2018), DOD/NISPOM (18 May 2016), EAR (16 Feb 2018), FACR/OFAC (28 Dec 2017), FTR (20 Sep 2017), HTSUS (27 Feb 2018), ITAR (14 Feb 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)

* Treasury; Foreign Assets Control Office; NOTICES; Blocking or Unblocking of Persons and Properties [Publication Date: 2 March 2018.]
 
* Treasury; Foreign Assets Control Office; RULES; North Korea Sanctions Regulations [Publication Date: 5 March 2018.]

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(Source:
Commerce/BIS, 1 Mar 2018.) 
 
* Respondents:
  – Trilogy International Associates, Inc., Altaville, CA; and
  – William Michael Johnson, Angels Camp, CA
* Charges:
  – Three Charges of 15 C.F.R. § 764.2(a) – Engaging in Prohibited Conduct:
    On or about January 23, 2010, April 6, 2010, and May 14, 2010, respectively, Trilogy International engaged in conduct prohibited by the Export Administration Regulations (“EAR”) by exporting items subject to the EAR and controlled on national security grounds to Russia without the required BIS export licenses.
    The items involved were an explosives detector and a total of 115 analog-to-digital converters. The items were classified under Export Control Classification Numbers 1A004 and 3A001, respectively, controlled as indicated above on national security grounds, and valued in total at approximately $76,035. Each of the items required a license for export to Russia pursuant to Section 742.4 of the EAR.
  – Three charges of 15 C.F.R. § 764.2(b) – Causing, Aiding, or Abetting a Violation:
   Between on or about January 20,2010, and May 14,2010, Johnson caused, aided, and/or abetted three violations of the EAR, specifically, three exports from the United States to Russia of items subject to the EAR without the required BIS export licenses.
   The items involved were an explosives detector and a total of 115 analog-to-digital converters, classified under Export Control Classification Numbers 1A004 and 3A001, respectively, controlled on national security grounds, and valued in total at approximately $76,035. Each of the items at issue required a BIS license for export to Russia pursuant to Section 742.4 of the EAR.
* Penalty:
  – Civil penalty of $100,000 against Trilogy International Associates, Inc.; and
  – Civil penalty of $100,000 against William Michael Johnson.
* Debarred: Both Trilogy International Associates, Inc. and William Michael Johnson are denied export privileges for a period of 10 years from the date of this Order, until 26 February 2028.
* Date of Order: 26 February 2018
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(Source:
Commerce/NIST, 20 Feb 2018.)
 
The U.S. Department of Commerce’s National Institute of Standards and Technology (NIST) has updated effective February 20, 2018, its NIST Special Publication 800-171 Rev. 1 on Protecting Controlled Unclassified Information in Nonfederal Systems and Organizations. This is the document that sets the requirements for compliance with DFARS Clause 252.204-7012 – Safeguarding Covered Defense Information and Cyber Incident Reporting.

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(Source:
CSMS #18-000187, 1 Mar 2018.)
 
A revised version of the External ACE Entry Summary Business Process document, which was released on Monday February 26, 2018, has been posted on cbp.gov and can be here.

The latest version of the external business process document includes a completely revised Section 18 (Drawback) based on the ACE drawback requirements stipulated by the Trade Facilitation and Trade Enforcement Act (TFTEA) of 2015.

All ACE Entry Summary Business Process document related questions, comments, and suggestions should be emailed to acebusinessrules@cbp.dhs.gov. 

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(Source:
CSMS #18-000184, 1 Mar 2018.)
 
On February 24, 2018, CBP implemented the Drawback requirements mandated by Section 906 of the Trade Facilitation and Trade Enforcement ACT of 2015 (TFTEA). CBP issued Drawback interim policy reflecting CBP’s tentative and conditional framework for drawback pending the issuance of a Final Rule to implement the regulatory changes pending for TFTEA-Drawback claims.  

CBP updated language in the interim policy document regarding mixed-use claims and claims with underlying entries that are the subject of reconciliation. Previous policy required documentation for mixed-use claims and claims with reconciled underlying entry summaries to be uploaded into DIS as part of a complete claim, within 24-hours of claim acceptance in ACE. Revised language updates the interim policy document to allow filers to submit DIS uploads for mixed-use claims within 30-days from the time the filer receives the mixed-use informational message in ACE. Revised language also updates the interim policy document to allow filers to submit DIS uploads for reconciliation within 30- days of the liquidation of all reconciliation entries associated with imports on the drawback claim. 

As the regulatory process and automation coalesce, CBP may issue additional guidance in order to keep members of the trade apprised of future changes and requirements. The Policy office stands behind our commitment to work with the trade during ACE Drawback deployment, the transition period and beyond.

Please send questions or comments to OTDRAWBACK@cbp.dhs.gov or DRAWBACKCERTIFICATION@cbp.dhs.gov.

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(Source: 
State/DDTC, 1 Mar 2018.)
 
DTrade Super users should ensure their email address in DTrade is accurate and correct. Please log in to DTrade and verify your email address. To change or update your DTrade email address, follow these instructions: Update Your DTrade Email Address Instruction Form.
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OGS_a7
7. Treasury/OFAC Amends and Reissues North Korea Sanctions Regulations
(Source: Treasury/OFAC, 1 Mar 2018.)  
 
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is announcing the amendment and reissuance in its entirety of the North Korea Sanctions Regulations, 31 C.F.R. part 510, in order to implement Executive Order (E.O.) 13687, E.O. 13722, and E.O. 13810, and to reference the North Korea Sanctions and Policy Enhancement Act of 2016 and the Countering America’s Adversaries Through Sanctions Act of 2017.  Pursuant to these authorities, all property and interests in property of the Government of North Korea and the Workers’ Party of Korea are blocked, and U.S. persons are generally prohibited from engaging in transactions with them without authorization from OFAC and must block property or interests in property that are in, or come within, the United States or the possession of a U.S. person.  In addition, these authorities provide the Secretary of the Treasury, in consultation with the Secretary of State, additional tools to disrupt North Korea’s ability to fund its weapons of mass destruction and ballistic missile programs.  OFAC is also publishing new and updated North Korea-related FAQs.
 
The Regulations and the FAQs emphasize that all U.S. persons must comply with OFAC regulations, including all U.S. citizens and permanent resident aliens regardless of where they are located, all individuals and entities within the United States, and all U.S.-incorporated entities and their foreign branches.  Furthermore, all transactions within the United States, including all financial transactions that transit the U.S. financial system, must comply with OFAC regulations.  For additional information, see FAQ 11 and 31 C.F.R. part 510, subpart G.
 
Violations of the North Korea Sanctions Regulations, issued under the authority of the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701-06 (IEEPA), and other statutes can result in substantial civil monetary penalties, referral for criminal prosecution, or both.  Each violation of the North Korea Sanctions Regulations is subject to a civil monetary penalty of up to the greater of the IEEPA statutory maximum ($289,238 as of March 1, 2018) or twice the value of the underlying transaction.  Criminal penalties of IEEPA can reach $1,000,000 and 20 years imprisonment per violation.  For additional information, see FAQ 12 and 31 C.F.R. part 510, subpart G. 
 
For additional information regarding OFAC’s prohibitions and penalties, see Basic Information on OFAC and Sanctions. 
 
The regulations will be published in the Federal Register, and the changes will take effect, on: March 5, 2018
 
Further information about the North Korea sanctions may be found here.

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OGS_a8
8. Australia DFAT: “Exporters Embrace Australia’s Trade Agreements”
(Source: Australia DFAT, 1 Mar 2018.)
 
Australia’s job-creating trade agreements are being widely used by Australian businesses, according to a research report released today.
 
The Free Trade Agreement Utilisation Study is the most robust and comprehensive evaluation of trade agreement utilisation in Australia to date.
 
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NWSNEWS

NWS_a1
9. Azernews: “Uzbek President Approves New Export Control System”
(Source: Azernews, 28 Feb 2018.)
 
Uzbek President Shavkat Mirziyoyev approved a new system of organization of work and control in the sphere of development and diversification of exports.
 
This became known following the video-selector meeting chaired by Mirziyoyev and devoted to the analysis of the fulfillment of the tasks set to increase exports and reduce imports, Sputnik reported.
 
From now, a group led by Deputy Prime Minister Nodir Otazhonov and First Deputy Prosecutor General Erkaboy Tadjiev will be responsible for organizing and monitoring exports. The hokims of the regions and the first deputies of regional prosecutors will be engaged in the export on the local level.
A republican working group on the organization and monitoring of work to reduce imports will also be established. Head of the Department for Combating Tax, Currency Crimes and Legalization of Criminal Incomes at the Prosecutor General’s Office Akmalhuzha Mavlonov was appointed as its head. The same working groups, headed by the heads of territorial departments, will be organized in the regions.
 
“The tasks of this department will be radically changed in accordance with the current requirements in terms of streamlining the import and export issues. The department should organize systematic work to prevent uncontrolled leakage of currency funds from the country, reduce imports, support the production of import-substituting products,” the press service of the president said.
 
The working groups will have to travel to the places, work in close cooperation with exporters, provide them with real help in increasing exports and create ‘green corridors’. They will assist farmers and the population in growing high-yield fruit and vegetable crops, organize work to provide them with seeds, cash, fertilizers and fuel.
 
In addition, the working groups will regularly analyze the structure of imports, provide full assistance in the implementation of specific projects for the development of domestic production. In the same order, ministers and industry leaders will now organize their work.

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NWS_a210. The Jerusalem Post: “Fear of U.S. Sanctions Ends German Companies Fueling Iranian FM’s Plane”

(Source: The Jerusalem Post, 28 Feb 2018.) [Excerpts.]
 
Energy and oil companies refused to refuel Iranian Foreign Minister Javad Zarif’s airplane ahead of his trip to the Munich Security Conference in mid-February to avoid violations of US sanctions targeting the clerical regime in Tehran, according to German media reports on Tuesday.
 
To avoid a serious diplomatic crisis, Chancellor Angela Merkel’s administration ordered the German Air Force to refuel his plane in order to assure Zarif that he could leave the Federal Republic. …
 
US National Security Adviser H.R. McMaster said at the Munich Security Conference, “When you invest in Iran, you’re investing in the IRGC. You might as well cut the Islamic Revolutionary Guard Corps a check and say, ‘Please use this to commit more murder across the Middle East.'”

He added, “And when we look at the biggest trading partners with Iran, we of course see Russia, we see China. But we also see Japan, South Korea and Germany. It’s time to focus business intelligence efforts to figure out who we are really doing business with, and cut off funding.”

Germany previously faced criticism for selling deadly chemical agents to Syrian President Bashar Assad during the Merkel administration and that of her predecessor, Gerhard Schröder. …

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NWS_a311. ST&R Trade Report: “ACE Downtime Procedures Issued as CBP Works to Minimize Outages”
 
U.S. Customs and Border Protection has issued a document intended to provide guidance on CBP processes during ACE system interruptions and to help trade partners develop their own downtime policies and procedures. CBP officials have also said they are taking steps to limit such downtime.
CBP states that this document reflects the ACE downtime policy distributed to the field in September 2017, which is based on security, enforcement, and facilitation, in order of importance. It is intended to provide as much uniformity as possible yet still allow sufficient flexibility for ports to adjust and adopt their own procedures suited to local risk factors, business models, infrastructure, and other factors if necessary.
 
The guidance is a living document that will be revised as necessary to adapt to changing circumstances. It outlines the documents required for manual clearance of entry, the procedures for processing cargo (including specific procedures for truck, rail, vessel, air, and air express shipments), and the responsibilities of CBP and traders during downtime.
 
While this guidance reflects CBP’s expectation that ACE will experience periods when it is unavailable to users, officials have said the agency is also working to minimize the frequency and impacts of such occurrences. Acting Commissioner Kevin McAleenan said at the East Coast Trade Symposium that CBP is working to make ACE more “bulletproof” by improving its redundancy and resiliency. Kathryn Kolbe, executive assistant commissioner for enterprise services, added that CBP is working to implement a cloud-based disaster recovery system and developing software to allow automated processing when the ACE portal goes down.
 
Kolbe said CBP is also planning to improve the ACE dashboard to provide better and more real-time information on system status. A working group of the Commercial Customs Operations Advisory Committee reported Feb. 28 that CBP has assigned a development team to begin working on dashboard enhancements the group recommended in November 2017 and that those enhancements will be implemented throughout 2018.
 
View Document(s):

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NWS_a412. WorldECR News Alert of 1 Mar
(Source: WorldECR, 1 Mar 2018.)
 
  (1) EU and US pile on pressure with further sanctions on DPRK;
  (2) UK issues guidance on updated controls for information security products;
  (3) OFAC acts to disrupt Libya-Europe oil smuggling network;
  (4) EU raises prospect of sanctions against Myanmar, Cambodia and the Maldives; and
  (5) Australia updates its consolidated list.
 
[Editor’s Note: Click on the source link below the item title to subscribe to WorldECR, the journal of export controls and sanctions.]

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COMMCOMMENTARY

COMM_a01
13. K.C. Georgi, R.K. Alberda & L. Hardaway: “What Are the Risks of Doing Business with the Russian Oligarchs List and the Russian Defense/Intelligence List?”
(Source: Arent Fox LLP, 1 Mar 2018.)

* Authors: Kay C. Georgi, Esq., kay.georgi@arentfox.com, +1 202-857-6293; Regan K. Alberda, Esq., regan.alberda@arentfox.com, +1 202-775-5771; and Lamine Hardaway, Esq., lamine.hardaway@arentfox.com, +1 202-715-8596. All of Arent Fox LLP.
 
At the end of January 2018, the Trump Administration took two actions related to the Russia/Ukraine sanctions program under the Countering America’s Adversaries Through Sanctions Act of 2017 (CAATSA), the law that President Trump signed on August 2, 2017. There was some confusion, however, because the two actions both related to Russia and came within one day of each other.
 
  (1) The Administration provided a non-sanctions list of Russian senior political figures and oligarchs (the  “Russian Oligarchs List”) to the US Congress as required by CAATSA Section 241.
  (2) The Administration announced that, for now, it did not need to impose sanctions pursuant to CAATSA Section 231, which authorizes the imposition of sanctions on entities that have engaged in a significant transaction with one of a list of parties that is a part of, or operates for or on behalf of, the defense or intelligence sectors of the Russian government (“Russian Defense/Intelligence List”), which was announced in October 2017.
 
While these acts did not result in the imposition of any actual sanctions, they do provide additional hints to business where the Trump Administration is headed in the months ahead, identifying risk areas business can review and assess.
 
In particular, companies engaging in business in Russia should do due diligence to determine if any person on the Russian Oligarchs List owns or controls 50 percent or more of a current or potential business partner. If they do, a careful risk assessment should be conducted to see whether to proceed with future business and what measures, such as contract provisions, might allow them to exit from the contract or relationship if the Oligarch is subject to actual sanctions in future.
 
Companies selling to or purchasing from entities on the Russian Defense/Intelligence List need to check what they are buying/selling. Is it a defense or military article or service? Is the value of the transaction large? If so, there is a substantial risk of secondary sanctions on the company doing the transaction.
 
The Russian Oligarchs List Under CAATSA Section 241
 
On January 30, 2018, the Treasury Department published the Oligarch List pursuant to section 241 of CAATSA. The list of people provided in the report is not a sanctions list, so it does not impose any sanctions (although as a practical matter, a number of the individuals in the report are already subject to sanctions under other OFAC sanctions programs). The list identifies persons falling under one of the following three categories:
 
  (1) Senior political figures
including senior members of Putin’s administration; Russian cabinet members; and other senior political leaders;
  (2) Oligarchs
, Russian individuals with an estimated net worth of $1 billion or more; and
  (3) Parastatals
, entities that are at least 25% owned by the Russian government and that had $2 billion or more in revenues in 2016.
 
Some independent reporting suggests the targeted names were largely derived from the Forbes list, including Russian billionaires with ties to Putin and Russian state-owned or controlled entities. There is also a classified appendix to the report, which sets out in greater detail the grounds for the listings and identifies additional persons not listed in the unclassified portion of the Section 241 list.
 
While no new sanctions were imposed at the time, based on comments from the Treasury secretary, future sanctions of parties listed under Section 241 may be forthcoming under other sanctions laws. In response to bipartisan, congressional criticism that the mere listing of persons did not go far enough, Secretary Mnuchin informed lawmakers of the Treasury Department’s intention to impose sanctions in the coming months. Treasury secretary Mnuchin has indicated that the Treasury Department will use the report to inform future targeted sanctions by stating “there will be sanctions that come out of this.
 
Executive Order 13661, which authorizes the imposition of sanctions on senior political figures and their supporters, is most likely the authority under which designations will be made. This may be all the more likely now with increased calls for action in response to Special Counsel Robert Mueller’s indictment of 13 Russians for meddling in the 2016 US presidential election, coupled with the congressional criticism.
 
In the meantime, persons may continue to do deals with companies owned by (or associated with) persons on the Section 241 list, provided of course that the listed person does not appear on the SDN list and is not otherwise subject to sanctions.

Businesses should, however, begin to identify if they have current contracts with businesses owned or controlled by listed Oligarchs, and include due diligence for future significant relationships (e.g. long-term contracts, joint ventures) with such owned or controlled businesses. If the United States designates the Oligarch in question as an SDN, businesses he owns 50% or more of will also be blocked by operation of US law. This means that contracts involving the Oligarch or his business in US dollars or otherwise subject to US law will be blocked. Moreover, financial institutions may be unwilling to take on the risk of handling transactions with SDN Oligarchs and their businesses even in other currencies.
 
The Russian Defense/Intelligence List Under CAATSA Section 231
 
On October 27, 2017, the Trump Administration published the Russian Defense/Intelligence List. That list was a list of entities that are part of, or operate for or on behalf of, the defense or intelligence sectors of the Russian government. As in the case of the Oligarch List, the publication of the Russian Defense/Intelligence List did not itself trigger sanctions, but set the stage for sanctions to be imposed with persons who engage in “significant transactions” with entities appearing on the Russian Defense/Intelligence List.
 
January 29, 2018 was the first date on which the US government could have imposed sanctions on persons that engage in a significant transaction with entities appearing on the Russian Defense/Intelligence List. However, the Trump Administration did not impose sanctions on that date, and indicated that its actions in persuading third countries not to do business with Russian defense or intelligence sectors has made imposing sanctions unnecessary for now, although they did not rule out imposing sanctions in the future. Unlike the Oligarchs List, which is administered by the Treasury Department, the Russian Defense/Intelligence List is administered by the State Department. There was no similar indication from the State Department indicating near term sanctions under Section 231.

Because the Trump Administration feels that it has effectively dissuaded parties from engaging in significant transactions potentially subject to Section 231, we believe the administration is more likely to approach parties that appear to have a deal in the works contrary to Section 231 objectives, and pressure such parties to cancel the deal, rather than pursue Section 231 sanctions.
 
In requests for guidance on how broadly the US government intends to enforce Section 231, the State Department has emphasized the following published guidance:
 
Q: What is a “significant transaction?”

 
A: In determining whether a transaction is “significant” for purposes of Section 231 of the Act, the Department of State will consider the totality of the facts and circumstances surrounding the transaction and weigh various factors on a case-by-case basis. The factors considered in the determination may include, but are not limited to, the significance of the transaction to US national security and foreign policy interests, in particular whether it has a significant adverse impact on such interests; the nature and magnitude of the transaction; and the relation and significance of the transaction to the defense or intelligence sector of the Russian government.
 
In this initial implementation stage, our focus is expected to be on significant transactions of a defense or intelligence nature with persons named in the Guidance. [emphasis added] If a transaction for goods or services has purely civilian end-uses and/or civilian end-users, and does not involve entities in the intelligence sector, these factors will generally weigh heavily against a determination that such a transaction is significant for purposes of Section 231.
 
The apparent caveat in the guidance, which limits it to the “initial implementation stage” at least suggests that, in the future, the State Department determination of what constitutes a significant transaction may change. This poses a heightened risk that a more expansive range of transactions may become significant transactions. What is not clear is whether the State Department will revise its guidance in advance or we become aware of the change due to future designation actions.
 
In the meantime, companies selling to or purchasing from entities on the Russian Defense/Intelligence List need to check what they are buying/selling. Is it a defense or military article or service? Is the value of the transaction large? If so, there is a substantial risk of secondary sanctions on the company doing the transaction.
 
In these cases, the company contemplating the transaction may not want to rely on receiving a warning call from the State Department and then attempt to exit the relationship. A call from the US government warning as to the potential for future sanctions likely will not qualify as force majeure. This means that any company that decides to proceed with an otherwise risky transaction with an entity that appears on the Russian Defense/Intelligence List should ensure that the contract includes a clause that will excuse non-performance in any case where they are notified of the possibility of future sanctions.

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(Source:
Volkov Law Group Blog, 27 Feb 2018. Reprinted by permission.)
 
* Author: Michael Volkov, Esq., Volkov Law Group, mvolkov@volkovlaw.com, 240-505-1992.
 
In the business world, answering questions is not the same as the game show Jeopardy. Nor does it require an answer in the form of a question (thank goodness, although that is not a bad strategy). CEOs are used to being put on the spot and doing the CEO-shuffle. They are good at it – they have to answer questions from key stakeholders, the media, and sometimes even the public.
 
Corporate boards, hopefully, will be embracing a new model of corporate governance. As part of this new era, corporate boards need to focus on company culture. As they do so, they need to ask a CEO some basic questions about the company’s culture. This is part of the process to advance accountability – a board and the CEO have to be held accountable for preserving and promoting a company’s culture. After all, it usually is the most valuable intangible asset that a company owns and controls.
 
We all know the research showing how important a company’s culture and its reputation is to the overall performance and value of a company. Corporate boards and CEOs understand this idea. Yet, in many ways, corporate boards and CEOs do not know how to asses, manage, monitor and advance the company’s culture. Because culture is not “tangible,” board members and CEOs tend to ignore the issue or fail to demand that the CCO develop techniques to assess, measure and manage the company’s culture.
 
To further the importance a company’s culture, the board needs to ask the CEO three important questions.
 
  (1) What is the company’s culture?
 
Call it the first round Jeopardy. The CEO needs to be able to define, explain and articulate the company’s culture. This will provide an important indication of just how accessible and meaningful the company’s culture is to the performance of the company.
 
There are two wrong answers to this question. First, the company’s culture cannot be “Do the Right Thing.” This phrase is overused and fails to advance a specific approach to build buy-in from the company’s culture. It is important to remember that the company’s culture has to be defined in a manner that aligns with the corporation, its leadership, managers and employees. “Doing the Right Thing” is not a call to arms, is not a mission, nor is it a way to define a positive message.
 
Conversely, the company’s culture cannot be defined in esoteric terms. I recall a transportation company’s cultural definition as expressed in the phrase “treating humans with dignity.” I understand that transportation provides important services to promote business relationships, bringing families together, and doing so safely and reliably. But where do we get to the point of “treating humans with dignity”?
 
In the end, the company’s culture has to be expressed in its beliefs and it mission. Company employees want to believe in what the company believes in and further that mission. A culture has to be defined in this context.
 
  (2) What specific actions do you plan to take to promote the company’s culture?
 
A CEO has to answer this question with much more than just the standard answer – “I live it every day” or “I communicate this point at every town hall or internal meeting.” Itb is not enough to use words to promote a culture – we all know the videos, CEO letters written by CCOs and newsletter communications. My answer to that is “so what?” The question is intended to cause the CEO to think about his/her conduct and how they can advance the company’s culture through action not mere words.
 
Some examples of this are easy to list – a CEO is the first to take training classes and promotes that fact; the CEO requires the CCO to attend and participate in senior business management meetings to ensure that the company filters its business decisions through ethics and compliance values; the CEO carries the company’s code of conduct with him/her and brings it to every meeting; the CEO attends and speaks at every new employee hiring meeting and explains the importance of ethics and compliance and the company’s culture; the CEO rejected a business strategy because it was inconsistent with the company’s ethical culture.
 
  (3) What steps will you take to measure culture, promote culture in the company and remediate culture weaknesses?
 
The CEO has to treat the company’ culture as its most important intangible asset. Just like the company’s tangible assets that need to be protected, the CEO has to articulate how he/she will ensure that the company’s culture will be protected.
 
In response, the CEO needs to describe his/her actions and how he/she will hold senior management, the CCO, and managers and employees accountable for the company’s culture. When a senior manager harms a company’s assets, the manager is held accountable for his/her failure. When an employee steals an asset from the company, the employee is disciplined and probably fired. The key strategy here is accountability. A CEO has to define what he/she expects from senior managers, the CCO, managers and employees with respect to the company’s culture and the CEO must hold these actors accountable for their performance as part of incentives and annual evaluations.
 
A CCO play a critical role in this area and has to ensure that he/she regularly reports to the CEO on the company’s culture. Such reporting has to involve measurement and monitoring of the company’s culture, along with strategies to intervene and remediate culture weaknesses.

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COMM_a3
15. R.C. Thomsen II, A.D. Paytas, & M.M. Shomali: “Changes to Export Controls in Feb 2018”
(Source:
alerts@t-b.com
, 28 Feb 2018.) [Excerpts.]
 
* 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.
 
 
House Foreign Affairs Committee Chairman Ed Royce (R-CA) introduced bipartisan legislation to modernize U.S. export control regulations of dual-use items. Ranking Member Eliot Engel (D-NY) is an original co-sponsor. According to the Press Release, the
Export Control Reform Act of 2018
(H.R. 5040) (ECRA) will help ensure the U.S. maintains its technological advantage in science, engineering, manufacturing and other industries critical to our national and economic security. This bill represents the first real push to establish permanent export controls since the Cold War-era Export Administration Act of 1979 (EAA) lapsed in 2001.
 
Since 2001, Congress has been relying on authority delegated by the President under the International Emergency Economic Powers Act (IEEPA) to continue to apply the EAA provisions. The problems with this current process are that the processes do not necessarily contain emerging technologies like cyber tools and artificial intelligence. Also, some aspects of current export control law impose significant compliance obligations and associated cost on industries without enhancing U.S. national security, which may restrict the U.S. export control system’s ability to adapt to changing global supply chains and changing threats.
 
The proposed ECRA addresses these problems in several ways. Most importantly, it ceases the EAA and replaces it with legislation that does not require regular Congressional re-approval (Section 114). The ECRA also seeks to modernize the legislative basis for U.S. export controls in ways that impact U.S. and non-U.S. businesses. Probably the most substantive changes involve countering the perceived threat of countries getting access to emergent critical technologies in the United States through acquisitions and collaborations with U.S. companies.
 
The ECRA addresses this threat in many ways. First, it proposes that the reach of U.S. export control law expand to cover transfers of controlled technology to U.S.-organized but foreign-owned companies within the United States. Transfers of controlled technology or source code would now be considered a “deemed export” and therefore be subject to licensing requirements under the EAR. Second, the ECRA broadens the definition of “technology” controlled by the EAR to include “foundational” and “know-how.” This enables EAR control further into developmental activities which might not be controlled currently. Additionally, the ECRA requires that the President establish an ongoing inter-agency process for identifying emergent critical technologies not currently subject to U.S. export control and establish controls for them.
 
There are general provisions intended to modernize the U.S. dual use export control regime. The provisions include, establishing more factors to be considered in granting authorizations for exports including the likely impact on human rights, military interoperability, and the need to promote U.S. technological leadership. Updating the criminal and civil penalties for violations. Requiring applicants to notify the Commerce department of any material fact changes affecting their applications. Promote simplification of the overall export control framework. Requiring the President to notify Congress in advance for any EAR revisions and submit an annual report to Congress on the implementation of EAR controls. Finally, expanding controls on brokering dual use items to include maritime nuclear propulsion and activities related to “specific foreign intelligence services.”
 
Some helpful Links include:
 
 
Regulatory Updates
 
Request for Comments for Military Items
 
 
BIS is seeking public comments to perform a complementary review of items on the Commerce Control List concurrent with the Department of State’s review of the controls implemented in its recent revisions of parts of the United States Munitions List (which control explosives and energetic materials, propellants, incendiary agents and their constituents; personal protective equipment; and military electronics), to ensure that the descriptions of these items on the CCL are clear, items for normal commercial use are not inadvertently controlled as military items on the USML, technological developments are accounted for on the control lists, and controls properly implement the national security and foreign policy objectives of the United States. This Notice of Inquiry also furthers the regulatory reform agenda directed by the President in Executive Order 13777. Comments must be received by BIS no later than April 13, 2018.

Specifically, BIS is soliciting comments on the clarity, usability and any other matters related to implementation of the “600 series” ECCNs that control the following items, as well as certain items related thereto: energetic materials (ECCNs 1B608, 1C608, 1D608 and 1E608); armored and protective “equipment” (ECCNs 1A613, 1B613, 1D613, 1E613); military electronics (ECCNs 3A611, 3B611, 3D611 and 3E611); and cryogenic and superconducting equipment (ECCNs 9A620, 9B620, 9D620 and 9E620).
A core element of the transfer of certain articles on the USML to “600 series” ECCNs on the CCL has been the streamlining of categories on the USML, resulting in the control on the CCL of items that the President determines do not warrant USML control. On December 10, 2010, the Department of State provided notice to the public of its intent to revise the USML to create a more “positive list” that describes controlled items using, to the extent possible, objective criteria rather than broad, open-ended, subjective, or design intent-based criteria (see 75 FR 76935). As a practical matter, this meant revising USML categories so that, with some exceptions, the descriptions of defense articles that continued to warrant control under the USML did not use catch-all phrases to control unspecified items. With limited exceptions, the defense articles that warranted control under the USML were those that provided the United States with a critical military or intelligence advantage. All other items were to become subject to the export licensing jurisdiction of the EAR. Since that time, the Department of State has published final rules setting forth revisions for eighteen USML categories, each of which has been reorganized into a uniform and more “positive list” structure. In coordination with the Department of State, the Department of Commerce has published final rules that made corresponding revisions to the CCL by controlling items that the President has determined do not warrant control on the USML.

The advantage of revising the USML into a positive list is that its controls can be tailored to satisfy the national security and foreign policy objectives of the U.S. Government by maintaining control over those defense articles that provide a critical military or intelligence advantage, or otherwise warrant control under the ITAR, without inadvertently controlling items in normal commercial use. However, this approach requires that the USML and the CCL be regularly reviewed and updated to account for the following: technological developments; issues identified by exporters and reexporters involving the practical application of these controls; and changes in the military and commercial applications of items affected by the USML or by the corresponding “600 series” ECCNs on the CCL.

Consistent with the approach described above, this NOI requests public comments as part of a review of changes to the EAR that complements a similar review the Department of State is performing with respect to the ITAR. As discussed above, the Departments of State and Commerce reviews are being undertaken to follow up on sets of rules published by the Departments of State and Commerce. These rules implemented revisions to the following categories of the USML: Category V (explosives and energetic materials, propellants, incendiary agents and their constituents), effective July 1, 2014 (see 79 FR 34); Category X (protective personnel equipment), effective July 1, 2014 (see 79 FR 34); and Category XI (military electronics), effective December 30, 2014 (see 79 FR 37536). These rules also added the following “600 series” ECCNs to the CCL: ECCNs 1B608, 1C608, 1D608, 1E608, 1A613, 1B613, 1D613 and 1E613, effective July 1, 2014 (see 79 FR 264), and ECCNs 3A611, 3B611, 3D611, 3E611, 9A620, 9B620, 9D620 and 9E620, effective December 30, 2014 (see 79 FR 37551). The Department of State is seeking comments from the public on the condition and efficacy of the revised Categories V, X, and XI and whether they are meeting the objectives for the list revisions. BIS will make any changes to the CCL that it determines are necessary to complement revisions to the USML by the Department of State. In addition, through this NOI, BIS is independently seeking comments on how to improve the implementation of these “600 series” ECCNs on the CCL.
BIS is also seeking comments on potential cost savings to private entities from shifting control of specific commercial items frm USML to the CCL. 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.
 
BIS comments may be submitted through the Federal rulemaking portal (
http://www.regulations.gov
) by April 13, 2018.
 
State Department Request
 
The Department of State requests comments from the public to inform its review of the controls implemented in recent revisions to Categories V, X, and XI of the United States Munitions List (USML). The Department periodically reviews USML categories to ensure that they are clear, do not inadvertently control items in normal commercial use, account for technological developments, and properly implement the national security and foreign policy objectives of the United States. The Department will accept comments on the Notice of Inquiry up to April 13, 2018.

The Department requests public comment on USML Categories V, X and XI. General comments on other aspects of the ITAR, to include other categories of the USML, are outside of the scope of this inquiry. In order to contribute effectively to the USML review process, all commenters are encouraged to provide comments that are responsive specifically to the prompts set forth below.

The Department requests comment on the following topics, as they relate to Categories V, X and XI:

  (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.

The Department will review all comments from the public. If a rulemaking is warranted based on the comments received, the Department will respond to comments received in a proposed rulemaking in the Federal Register.
 
The Department will accept comments on the Notice of Inquiry up to April 13, 2018. You may send comments, identified by docket number DOS-2017-0017, by any of the following methods:
 
  – Email:
DDTCPublicComments@state.gov

Include docket number DOS-2017 in the subject line with, ”Request for Comments Regarding Review of USML Categories V, X and XI.” 

– Internet: At
www.regulations.gov
. Follow the instructions for sending comments using docket number, DOS- 2017-0017. Comments submitted through
www.regulations.gov
will be visible to other members of the public; the Department will publish all comments on the Directorate of Defense Trade Controls website (
www.pmddtc.state.gov
). Therefore, commenters are cautioned not to include proprietary or other sensitive information in their comments.
 
 
The Schedule B commodity classification codes for export have been updated for 2018. Codes are updated every January and July at the 10-digit level. In this blog, we will explore three resources available on our website to help you navigate these updates. All resources can be found online.
 
Schedule B Book
 
From the Census web site the new 2018 Schedule B book is available in the red box labeled “Browse” in HTML and PDF formats. Simply click on the link “Look through HTML or PDF versions of Schedule B book content” next to 2018 to browse section and chapter notes and Schedule B numbers by chapter.
All current and historic codes added or removed from the Schedule B going back to the last major revision, in January 2017, can be found in the “Add/Delete List” under “Browse chapters.”
 
Obsolete Codes List
 
Outdated Schedule B codes are available in the red box labeled “Obsolete Codes.” The “Obsolete to New” list is a quick way to see which codes are no longer valid, starting January 2018, and which new codes replaced them. Notice that from 2016 forward, there were obsolete codes in both January and July. Before 2016, the Schedule B numbers were only updated annually.
 
Schedule B Search Engine
 
The third resource available is the Schedule B Search Engine. Type a Schedule B number into the search engine, and if it appears, then the number is still valid. However, if the number is outdated, the search engine will show “No Results” for the code.
 
Enforcement Actions
 
 
BIS has acted against Turkish national Gulnihal Yegane and three affiliated Turkish companies who are involved in illicitly procuring and supplying Iranian airlines with U.S.-origin aircraft engines and spare parts. The action, called a “temporary denial order” (TDO), suspends the export privileges of Gulnihal Yegane (“Yegane”), Trigron Lojistik Kargo Limited Sirketi (“Trigron”), Ufuk Avia Lojistik Limited Sirketi (“Ufuk Avia”), and RA Havacilik Lojistik Ve Tasimacilik Ticaret Limited Sirketi (“RA Havacilik”). Gulnihal Yegane was previously added to the BIS Entity List for smuggling parts to Iran’s Mahan Air.
 
Yegane is actively involved in the illicit procurement of U.S.-origin aircraft engines and spare parts (ECCN 9A991) for Iranian airlines and has taken extensive steps to continue this activity while attempting to conceal her involvement after BIS added Yegane to the BIS Entity List in December 2013 for transactions involving Mahan Air (78 FR 75458). Mahan Air was designated by Treasury’s Office of Foreign Assets Control (OFAC) as a Specially Designated Global Terrorist in October 2011 for providing financial, material, and technological support to Iran’s Islamic Revolutionary Guard Corps-Qods Force. Yegane is now utilizing Trigron, which Yegane owns and operates, and Turkish logistics companies Ufuk Avia and RA Havacilik, with which Yegane is affiliated. The deceptive efforts to obtain U.S.-origin aircraft engines included re-structuring a transaction to Iran to conceal Yegane’s involvement after the initial attempt was discovered by BIS.
 
Temporary Denial Orders are issued by the Assistant Secretary for Export Enforcement of the Bureau of Industry and Security, denying the export privileges of a company or individual to prevent an imminent or on-going export control violation. These orders are issued for a renewable 180-day period and cut off not only the right to export from the United States, but also the right to receive or participate in exports from the United States. BIS is the principal agency involved in the implementation and enforcement of export controls for commercial technologies and many military items. The BIS Office of Export Enforcement detects, prevents, investigates and assists in the sanctioning of illegal exports of such items.
 
 
Two men were indicted by a federal grand jury in Seattle Wednesday for three federal felonies in connection with their scheme to smuggle dozens of firearms to Turkey and Iraq in violation of the Arms Export Control Act. Paul Stuart Brunt, 51, of Bellevue, Washington, and Rawnd Khaleel Aldalawi, 29, of Seattle, were arrested on a criminal complaint January 24, 2018.
 
According to records filed in the case, between October 2016 and November 2017, Brunt and Aldalawi engaged in a scheme to smuggle firearms from the U.S. to people associated with the Peshmerga military in Kurdistan, a part of Iraq. Brunt purchased the firearms at gun stores and gun shows around the Puget Sound region. The men then attempted to ship the guns from the Port of Seattle through Turkey and on to Iraq, hidden in the side panels of vehicles.
 
In the first shipment in February 2017, some 30 guns were hidden in three cars. In the second shipment in November 2017, 47 firearms were concealed in two vehicles. That second shipment was discovered by authorities in Turkey, and the shipment was traced back to Brunt and Aldalawi. The men had not obtained any export licenses for the firearms and smuggled them in violation of the Arms Export Control Act.
 
The conspiracy is punishable by up to five years in prison and a $250,000 fine. Violating the Arms Export Control Act is punishable by twenty years of imprisonment. The men are scheduled to be arraigned on the indictment on February 8, 2018.
 
 
The indictment of Usama Darwich Hamade, 53, Samir Ahmed Berro, 64, and Issam Darwich Hamade, 55, was announced this month for their conspiring to illegally export goods and technology from the United States to Lebanon and to Hizballah, a designated foreign terrorist organization, in violation of the International Emergency Economic Powers Act (IEEPA), the Export Administration Regulations, and the International Traffic in Arms Regulations. Defendants Usama Hamade and Issam Hamade are currently in custody in South Africa. Samir Ahmed Berro remains at large.
 
According to the Indictment, from 2009 through December 2013, Usama Hamade, Berro and Issam Hamade willfully conspired to export and attempted to export from the United States to Lebanon, and specifically to Hizballah, goods and technology without obtaining the required export licenses from the U.S. Department of Commerce and the U.S. Department of State, in violation of IEEPA, the Export Administration Regulations, the Arms Export Control Act, and the International Traffic in Arms Regulations. According to the Indictment, those goods included inertial measurement units (IMUs) suitable for use in unmanned aerial vehicles (UAVs), a jet engine, piston engines and recording binoculars.
 
 
A Port St. Lucie man was indicted on charges related to the illegal exportation of firearms, firearms accessories and ammunition. The indictment resulted from an investigation conducted by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in Miami and Brazil; the Bureau of Alcohol, Tobacco and Firearms; U.S. Customs and Border Protection, along with the Rio de Janeiro Civil Police, the Brazilian Federal Police, the Brazilian Federal Prosecutor’s Office and the Brazilian Customs Service.
 
Frederik Barbieri, 36, of Ft. Pierce, Florida, was charged with one count of conspiracy to commit offenses against the United States, one count of delivering firearms to a contract carrier without notification, that shipment contained firearms, one count of smuggling firearms and fire accessories from the United States to Brazil and one count of exporting firearms and firearms accessories without a license. According to court documents, Barbieri entered into a conspiracy to illegally export firearms to Brazil without a license, which lasted from May 2013 to June 2017. Barbieri and his co-conspirators purchased firearms, firearms accessories and ammunition, obliterated the serial numbers and concealed the weapons, the accessories and the ammunition in different packages.
 
Barbieri and his co-conspirators would then ship the packages to Brazil, where Barbieri and his co-conspirators would sell such firearms, firearm accessories, and ammunition at a profit. It is further alleged that on May 26, Barbieri shipped a package concealing firearms and firearms accessories to Brazil without obtaining a license to export those items and without notifying the contract carrier that the package contained firearms.
 
If convicted, Barbieri faces a maximum statutory sentence of five years on Counts 1 and 2, a maximum statutory sentence of 10 years on Count 3, and a maximum statutory sentence of 20 years on Count 4. …

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COMM_a4
16. Gary Stanley’s EC Tip of the Day
(Source: Defense and Export-Import Update, 27 Feb 2018; available by subscription from
gstanley@glstrade.com
)
 
* Author: Gary Stanley, Esq., Global Legal Services, PC, (202) 352-3059,
gstanley@glstrade.com
.

For those tasked with your company’s compliance with the 
DFARS Clause 252.204-7012 – Safeguarding Covered Defense Information and Cyber Incident Reporting and, by extension, NIST SP 800-171 Rev. 1 requirements, NIST’s Computer Security Resource Center has these other documents that may prove helpful:
 

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TEEX/IM TRAINING EVENTS & CONFERENCES

TE_a117. ECS Announces “ITAR/EAR Beyond the Basics” on 20-21 Mar in San Diego, CA
(Source: Suzanne Palmer, spalmer@exportcompliancesolutions.com)
 
* What: ECS Presents ITAR/EAR Beyond the Basics, Establishing A Rock-solid Export Compliance Program
* When: March 21-22, 2018
* Sponsor: Export Compliance Solutions (ECS)
* ECS Speaker Panel: Suzanne Palmer, Lisa Bencivenga
* Register HERE or by calling 866-238-4018 or e-mail spalmer@exportcompliancesolutions.com.
* Discount: Daily Bugle subscribers get a 10% discount when they use the coupon code: ECS10PERBUGLE when registering for this event.
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ENEDITOR’S NOTES

 
* Justin Bieber (Justin Drew Bieber; born 1 Mar 1994, is a Canadian singer and songwriter. He became the first artist to have seven songs from a debut record chart on the Billboard Hot 100.)
  – “I want my world to be fun. I got a bright future ahead of me.”
 

*
Robert Bork (Robert Heron Bork; 1 Mar 1927 – 19 Dec 2012; was an American judge, government official, and legal scholar who advocated the judicial philosophy of originalism. Bork served as a Yale Law School professor, the United States Solicitor General, the Acting United States Attorney General, and as a judge of the United States Court of Appeals for the District of Columbia Circuit. In 1987, President Ronald Reagan nominated Bork to the Supreme Court, but the United States Senate rejected his nomination.)
  – “When a judge assumes the power to decide which distinctions made in a statute are legitimate and which are not, he assumes the power to disapprove of any and all legislation, because all legislation makes distinctions.”

Some proverbs regarding rest:
 
“Rest breeds rust.”
  — German proverb
 
A man grows most tired while standing still.
  —  Chinese Proverb

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EN_a319
. 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: 22 Feb 2018: 83 FR 7608-7610: Technical Amendment to List of User Fee Airports: Name Changes of Several Airports and the Addition of Five Airports
 
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: 
16 Feb 2018:
83 FR 6949-6956
: Russian Sanctions: Addition of Certain Entities to the Entity List [Addition of 21 Entities to 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: 27 Feb 2018: Harmonized System Update 1802, containing 164 ABI records and 38 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: 14 Feb 2018: 83 FR 6457-6458: Amendment to the International Traffic in Arms Regulations: Addition of South Sudan [Amends ITAR Part 126.] 

  – The only available fully updated copy (latest edition: 14 Feb 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_a0320
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.

* 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, provided attribution is given to “The Export/Import Daily Bugle of (date)”. Any further use of contributors’ material, however, must comply with applicable copyright laws.

* CAVEAT: The contents of this newsletter cannot be relied upon as legal or expert advice.  Consult your own legal counsel or compliance specialists before taking actions based upon news items or opinions from this or other unofficial sources.  If any U.S. federal tax issue is discussed in this communication, it was not intended or written by the author or sender for tax or legal advice, and cannot be used for the purpose of avoiding penalties under the Internal Revenue Code or promoting, marketing, or recommending to another party any transaction or tax-related matter.

* SUBSCRIPTIONS: Subscriptions are free.  Subscribe by completing the request form on the Full Circle Compliance website.

* BACK ISSUES: An archive of Daily Bugle publications from 2005 to present is available HERE.

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