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18-0522 Tuesday “Daily Bugle”

18-0522 Tuesday “Daily Bugle”

Tuesday, 22 May 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: (No new postings.)
  3. DHS/CBP Updates CATAIR Appendix PGA
  4. DHS/CBP Updates AESTIR Appendix Q
  5. State/DDTC: (No new postings.)
  6. Treasury/OFAC Posts Ukraine-/Russia-related General Licenses, and Updates FAQs
  7. UK Updates Four Sanctions Guidance Documents
  8. Singapore Customs Posts Circular No 04/2018 Concerning STCCED 2018
  9. Singapore Customs Posts Circular No 05/2018 Concerning SLSFTA
  1. ST&R Trade Report: “New Tariffs on China ‘On Hold’ After Progress in Trade Talks”
  1. American Action Forum: CFIUS, Export Controls, and National Security
  2. L. Luo: “Brief Analysis of the U.S. Long Arm Jurisdiction in Export Control”
  3. S.M. Wise: “DDTC and BIS Propose New Rules to Continue Export Control Reform Initiative”
  4. Gary Stanley’s EC Tip of the Day
  1. ECS Presents “ITAR/EAR Boot Camp (Seminar Level I)” on 10-11 Jul in Long Beach, CA
  2. ECTI Presents “Welcome to the Club: An Overview of India’s Dual-Use and Defense Export Control Systems,” Webinar on 13 June
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Amendments: ATF (15 Jan 2016), Customs (12 Apr 2018), DOD/NISPOM (18 May 2016), EAR (17 May 2018), FACR/OFAC (19 Mar 2018), FTR (24 Apr 2018), HTSUS (4 May 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)

* Commerce; Industry and Security Bureau; NOTICES; Reporting for Calendar Year 2017 on Offsets Agreements Related to Sales of Defense Articles or Defense Services to Foreign Countries or Foreign Firms [Publication Date: 23 May 2018.]
 
* State; NOTICES; Designations as Global Terrorists [Publication Date: 23 May 2018.]:
  – Adnan Abu Walid al-Sahrawi, aka Abu Walid al Sahrawi, aka Adnan Abu Walid al-Sahraoui, aka Adnan Abu Waleed al-Sahrawi, aka Lehbib Ould Ali Ould Said Ould Joumani
  – ISIS in the Greater Sahara
 
* State; NOTICES; Determinations under the Arms Control Act [Publication Date: 23 May 2018.]
 
* Treasury; Foreign Assets Control Office; NOTICES; Blocking or Unblocking of Persons and Properties [Publication Date: 23 May 2018.]
 
Scheduled for Publication Later This Week:
 
* Commerce; Industry and Security Bureau; PROPOSED RULES; Control of Firearms, Guns, Ammunition and Related Articles the President Determines No Longer Warrant Control under the United States Munitions List [Publication Date: 24 May 2018.]
 
* State; PROPOSED RULES; International Traffic in Arms Regulations: U.S. Munitions List Categories I, II, and III [Publication Date: 24 May 2018.]
 
[Editor’s Note: Both items above were already included in the 15 May 2018 Daily Bugle, item 4 and 5.]
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(Source: 
Commerce/BIS
)

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(Source:
CSMS# 18-000353, 21 May 2018.)
 
The Appendix PGA document has been updated to include the change of ‘IN’ added to the FDA base unit, as per the change log.
 
Please visit this link below for more information.
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(Source:
CSMS #18-000355, 22 May 2018.)
 
At the request of the National Marine Fishery Service (NMFS), CBP has made the following update to AESTIR Appendix Q – PGA Record Formats.
 
  – AESTIR Appendix Q PGA Record Formats – the wording to clarify the eBCD number requirement.
  – And in NM9, the re-export number is for HMS program.
  – Also deactivated rules 67S and 67T for the validation of re-export number formats.
 
The above changes are also listed in the Summary of Changes to AESTIR.
 

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(Source:
Treasury/OFAC, 22 May 2018.)
 
Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing Ukraine-/Russia-related General License 15. General License 15 authorizes U.S. persons to engage in specified transactions related to winding down or maintaining business with GAZ Group and its subsidiaries until October 23, 2018. OFAC is also issuing Ukraine-/Russia-related General License 12C, which replaces and supersedes General License 12B in its entirety. General License 12C permits originating and intermediary U.S. financial institutions to process funds transfers that they would otherwise block to an account held by a blocked U.S. person at a U.S. financial institution. In addition, General License 12C clarifies that U.S. financial institutions can release such funds for authorized maintenance and wind-down purposes. OFAC is also publishing six new Frequently Asked Questions (FAQs) and revisions to existing FAQs about these general licenses.
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(Source:
Gov.UK, 21 May 2018.)
 
The UK Government’s Office of Financial Sanctions Implementation has updated the following guidance documents:
 

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(Source:
Singapore Customs, 22 May 2018.) [Excerpts.]
 
With effect from 24 June 2018, the Singapore Trade Classification, Customs and Excise Duties (STCCED) 2018 will replace the current 2012 version.
 
The STCCED 2018 incorporates the ASEAN Harmonised Tariff Nomenclature (AHTN) 2017. You may visit our website at www.customs.gov.sg > Businesses > Harmonised System (HS) Classification of Goods > Resources to view and download the STCCED 2018.
 
Arising from the AHTN 2017 review and among the many changes, we would like to highlight two key changes. Specific HS codes have been created for the following vehicles and they will be non-dutiable.
 
  (a) Go-karts
  (b) Golf cars
  (c) Pocketmotorcycles
  (d) Powered kick scooters
  (e) Mobilityscooters
  (f) All-Terrain Vehicles (ATV)
  (g) Self-balancingcycles
  (h) Electric bicycles
  (i) Vehicles specially designed for travelling on snow
 
A review was done on Chapter 98 to streamline and rationalise the use of HS codes in the Chapter. Please see Annex A for the changes.
 
With the implementation of AHTN 2017, new permit applications must be submitted using AHTN 2017 HS codes. For permits previously approved before the implementation date using AHTN 2012 HS codes:
 
  (a) Amendments of these permits must be submitted using AHTN2017 codes;
  (b) Cancellations of these permits are allowed if the permit has not expired or used for cargo clearance; and
  (c) Refunds applications are allowed.
 
A list of Frequently Asked Questions (FAQs) is provided in Annex B for your reference. If you need further clarification, please submit a feedback via www.customs.gov.sg/feedback or email your enquiries to customs_classification@customs.gov.sg. …

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The SLSFTA has come into force on 1 May 2018. This circular outlines the salient points of the Rules of Origin requirements and operational procedures for exports of Singapore-originating goods claiming preferential tariff treatment in the Democratic Socialist Republic of Sri Lanka (“Sri Lanka”).
 
From 1 May 2018 onwards, Sri Lanka is granting preferential tariff treatment under the SLSFTA for some items initially and is planning to extend preferential tariff treatment to all items agreed under the SLSFTA by 1 July 2018. Manufacturers and Traders are therefore required to refer to Gazette No. 2069-19 Revenue Protection Order No. 04-2018 issued by Sri Lanka’s Ministry of Finance to obtain the appropriate preferential tariff rate for the import of Singapore-originating goods into Sri Lanka offered from 1 May 2018 till 30 June 2018. The full tariff obligations and the legal text of the SLSFTA are available via Enterprise Singapore’s website.
 
Rules of Origin for Originating Goods
 
Your goods may qualify for preferential tariff treatment for importation into Sri Lanka if they fulfill the following Rules of Origin:
 
Rules of Origin under the SLSFTA
Goods Wholly Obtained or Produced
Goods wholly obtained or produced in Singapore as specified in Article 4 of Protocol 1 of the SLSFTA
Goods Not Wholly Obtained or Produced
Goods manufactured in Singapore and satisfies requirements under Article 5 of Protocol 1 of the SLSFTA
 
Accumulation
 
Sri Lanka and Singapore are treated as a single production area. This means that any goods or materials that originated from Sri Lanka will be deemed to have originated from Singapore, and vice versa, provided the goods or materials satisfy the origin requirements under the SLSFTA and are supported by a Preferential Certificate of Origin (PCO) by the supplier.
Documentation Procedures
 
To enable your importers in Sri Lanka to claim preferential tariff treatment under the agreement, the Singapore exporter shall apply for the PCO and Export Permit from Singapore Customs when exporting the goods.
 
For New Manufacturers
 
For Manufacturers who are not registered with Singapore Customs, please follow the documentation procedures found on the Singapore Customs’ website at http://www.customs.gov.sg > Businesses > Exporting Goods > Certificates of Origin.
 
For Registered Manufacturers with Singapore Customs
 
For Manufacturers who are registered with Singapore Customs, please note the following:
 
  (a) Manufacturers with new product lines are required to register the new products with the Tariffs and Trade Services Branch (TTSB) of Singapore Customs regardless if you were previously registered; and
  (b) Manufacturers are required to submit a Manufacturing Cost Statement (MCS) under the SLSFTA for goods to be exported to Sri Lanka to receive a PCO and claim preferential tariff treatment in Sri Lanka.
 
For Traders and Declaring Agents
 
For Exporters and Declaring Agents, please note the following when applying for a PCO for export to Sri Lanka via TradeNet:
 
  (a) Please select Certificate Type “18” when applying for the PCO; and
  (b) In addition to the normal requirements, please declare the corresponding 6-digit HS Code of your product and its origin criterion found in the “Verification of Cost Statement” letter in the “Certificate Item Description” field as part of your consignment details in the PCO.
 
For full details on how to apply for a PCO under the SLSFTA, please refer to Annex A and B for the format and explanatory notes of the PCO respectively and the “Handbook on the Application Procedures for a Certificate of Origin via TradeNet”, which may be downloaded from the Singapore Customs Website at http://www.customs.gov.sg > Businesses > Exporting Goods > Certificates of Origin > Step 3: Apply for Certificate of Origin via TradeNet > Handbook.
 
Retention of Documents
 
For post-verification checks, documents relating to the production and export shipments accompanied by the PCO should be kept for no less than 3 years from the date on which the PCO was issued.
 
Clarification
 
Please refer to the Frequently Asked Questions (FAQ) on the Rules of Origin under the SLSFTA in Annex C for more details. Alternatively, you may send your enquiries to customs_roo@customs.gov.sg for further clarifications on the contents of this circular.
 
For other clarifications on the SLSFTA, you may email Enterprise Singapore at enquiry@enterprisesg.gov.sg.

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NWSNEWS

 
The Trump administration is “putting the trade war [with China] on hold” after the two sides agreed on a framework for progress on trade issues during talks held May 17-18 in Washington, D.C., according to Treasury Secretary Steve Mnuchin. Specifically, the White House will suspend plans to levy an additional 25 percent tariff on $50 billion worth of imports from China in response to a Section 301 investigation concluding that Beijing is coercing U.S. companies into transferring their technology and intellectual property to Chinese enterprises. Those tariffs would have affected more than 1,300 products and could have been imposed as early as May 23.
 
According to a joint statement, China agreed to “significantly increase purchases of United States goods and services” to help reduce its trade surplus in goods with the U.S., which has been a prime focus for President Trump. Administration officials had previously pressed China to reduce this surplus by $200 billion by the end of 2020, but the statement did not refer to any specific figures.
 
Instead, the statement indicated that there was mutual agreement on securing “meaningful increases” in U.S. agriculture and energy exports to China, with a U.S. team slated to visit China to work out the details. However, the two sides were only able to agree on the need to “create favorable conditions to increase trade” in manufactured goods and services, with no indication of how that will be pursued.
 
On other long-standing trade irritants, the statement said the two sides agreed to (a) strengthen cooperation on intellectual property protections, with China pledging to advance relevant amendments to its laws and regulations in this area, and (b) encourage two-way investment and strive to create a fair, level playing field for competition.

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COMMCOMMENTARY

COMM_a0
11. American Action Forum: CFIUS, Export Controls, and National Security
(Source: American Action Forum, 21 May 2018.)
 
Introduction
 
Spurred by the rising presence of China as a foreign investor in United States firms, there is a renewed debate about how to better protect U.S. national security interests in business transactions between U.S. and foreign companies. Chinese investment in U.S. technology draws particular attention, sparking considerable interest in potential changes to the process by which these transactions are reviewed. Ideas for reform have centered around two current mechanisms for addressing these challenges: The Committee on Foreign Investment in the United States (CFIUS) and U.S. export control laws.
 
To reform CFIUS, Congressman Robert Pittenger and Senator John Cornyn introduced the Foreign Investment Risk Review Modernization Act (FIRRMA). Among its other provisions, the original bill would have empowered CFIUS for the first time to review outbound investment in addition to inbound investment. However, this language was recently eliminated in both the House and Senate bills after critics argued that outbound investment should be subject to traditional export controls and not CFIUS.
 
The House Financial Services Committee further altered FIRRMA by including the Export Control Reform Act (ECRA) in its text. The ECRA is a separate piece of legislation introduced by Congressman Ed Royce to expand the U.S. export control regime. Given these changes and the overall reform effort underway, it is important to understand the distinction between CFIUS and export controls as well as the purpose and abilities of each.
 
What is CFIUS?
 
CFIUS
 is an interagency committee headed by the Secretary of Treasury that is tasked with reviewing foreign mergers, acquisitions, and other foreign investments through the lens of preserving national security. That is, CFIUS is focused on transactions. The committee is made up of the heads of eight government agencies, including the Departments of Justice, Homeland Security, Defense, and Commerce. Specifically, CFIUS is authorized to review “covered transactions” – any transaction between U.S. and foreign companies that results in foreign ownership.
 
Before a merger takes place that would result in foreign ownership, U.S. companies have the option to voluntarily submit the transaction to CFIUS for review. CFIUS then considers multiple factors that can impact U.S. national security, including the transaction’s effect on U.S. technological leadership, the ability of domestic industry to meet national defense requirements, and whether it is a foreign government-controlled transaction. If CFIUS finds that the transaction poses a credible risk to national security, it can recommend to the president that it be blocked. It can also impose conditions that must be met before the merger or acquisition can go through to mitigate national security risks. If U.S. companies do not voluntarily submit their transactions for review, CFIUS has the authority to review covered transactions at a later date, sometimes years later, to ensure they do not threaten national security.
 
What Are Export Controls?
 
Export controls are used to regulate the export of goods, services, technology, and software with the purpose of safeguarding U.S. national security and promoting foreign policy objectives abroad. In contrast to CFIUS, export controls center on technologies and not specific transactions. It is a multifaceted system governed by the Departments of Commerce, State, Treasury, Defense, and other agencies. These laws control the export of multiple types of products that could threaten national security, regardless of whether the exporting company is foreign-controlled.
 
In practice, export controls regulate outbound products based both on their end uses and their destinations. With regard to end uses, there are three main types of exports that are controlled: military equipment, commercial items that have possible dual uses as military equipment, and items that can be used in the development of nuclear, chemical, or biological weapons. Controls are also used to restrict exports in adherence to international arms embargoes or to countries of general concern, namely those on which the United States has imposed sanctions.
 
The majority of exports that fall under these controls are identified by either the Department of Commerce or the State Department. The Department of Commerce determines which products fall under the Commerce Control List (CCL), which regulates dual-use items such as chemicals, electronics, and computers. The State Department keeps the U.S. Munitions List (USML), which controls the export of defense articles, services, and related technologies. Examples of exports on the USML include firearms, missiles, nuclear technology, and other substances that can be weaponized. In most cases, businesses that wish to export products under either of these lists must first obtain licenses from the government.
 
If exporters do not adhere to export control laws, they can face civil penalties of up to $500,000 per violation for defense articles and up to $250,000 per violation for dual-use items. Additionally, criminal violations may result in fines of $1,000,000 and a 20-year prison sentence.
 
The Current Landscape
 
As China increases its investment footprint in the United States, Congress continues to debate ways to prevent intellectual property theft and forced technology transfer – the practice of mandating that U.S. firms share their technology with Chinese firms in order to gain market access. Concerns are especially prevalent over technology transfers that occur as a result of joint ventures between U.S. and Chinese firms.
 
FIRRMA attempted to address this concern by mandating that CFIUS review technology transfers as a result of joint ventures between U.S. and foreign companies. This was a substantial shift from CFIUS’s original role of reviewing inbound foreign investment and sparked significant debate, especially among individuals arguing that the existing export control regime was better suited to protect against an outbound sharing of intellectual property. With the provision now removed, there is growing consensus around FIRRMA as a way to increase national security protections for the United States.
 
At the same time, ECRA was added to FIRRMA in the House of Representatives. This would expand the definition of “technology” subject to export control laws, increasing the number and types of exports that fall under export control regulations. It would also expand export controls to cover foreign-made items in the United States that are re-exported and “foundational information” or “know how” related to the creation of technology. Notably, ECRA would for the first time subject the transfer of technology between two companies in the United States to export controls, as long as one company is majority foreign owned.
 
Conclusion
 
CFIUS and export controls are two unique tools at the United States’ disposal to help evaluate foreign transactions and technology transfer based on potential national security impact. Reforms to each are currently being considered, and thoughtful changes have been made to increase the likelihood that reform efforts are successful.

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COMM_a01
12. L. Luo: “Brief Analysis of the U.S. Long Arm Jurisdiction in Export Control”
(Source: King & Wood Mallesons, 3 May 2018.)
 
* Author: Laura Luo, Partner, Laura.Luo@us.kwm.com, King & Wood Mallesons, New York.
 
Recently, a major Chinese technology firm has fallen into troubled waters with the U.S. Department of Commerce due to violations of U.S. economic sanctions against certain foreign nations. As a result, the U.S. levied severe penalties against the Chinese company, including a ban on export sales by American companies for seven years. Previous violations of U.S. export control law by the same company led to over $1 billion in fines.
 
This begs the question as to how a Chinese company would be subject to U.S. regulations in the first place. In fact, many U.S. domestic laws regulate foreign companies through the exercise of so-called long-arm jurisdiction. Such jurisdiction is often found when a foreign company establishes certain direct or indirect operational, contractual or commercial contact with the U.S. In a 2014 case, a U.S. federal appellate court went so far as to imputing U.S. activities conducted by a U.S. company to its Chinese parent company in order to find jurisdiction over the Chinese parent company. Thus, it is important to understand the major areas of laws and circumstances under which it may be subject to U.S. long-arm jurisdiction as non-compliance of such laws often result in severe commercial consequences.
 
To “mark” these areas of potential land mines, we are putting out a series of introductory articles that highlights certain areas with high compliance risks facing Chinese companies doing business with the United States or putting its products into the “stream of commerce” in the U.S. Our introduction will initially cover areas such as export control, national security review on foreign investment in the U.S., anti-money laundering, and anti-corruption.
 
Export Control
 
Given the significant impact that violations (even inadvertent ones) of U.S. export controls may have on Chinese companies, those looking to purchase goods from American entities must be cognizant of the nuances of U.S. law and maintain a rigorous export control compliance program.
 
Extraterritorial Reach of U.S. Export Control Law
 
The Export Administration Act (the “EAA”) and its implementing regulations, the Export Administration Regulations (the “EAR”), govern the export of most commercial products, including dual-use products (i.e., those that have both commercial and military functions). The U.S. Department of Commerce’s Bureau of Industry and Security (the “BIS”) is responsible for the administration and enforcement of the EAR. Unlike other U.S. laws which define the U.S. government’s extraterritorial reach with respect to parties, the EAA focuses on the product being exported and looks at its “nationality” to determine whether a foreign company is subject to the EAR.
 
Under the EAR, companies purchasing any of the following exports must comply with its provisions:
 
  – Any item in the U.S. (including those in a U.S. Foreign-Trade Zone and those moving through the U.S. from one foreign country to another);
  – Any U.S.-origin item wherever located;
  – Any foreign-made commodity that incorporates certain U.S.-origin commodities or that is bundled or commingled with certain U.S.-origin software;
  – Certain foreign-made products (including processes and services) produced directly by the use of U.S.-origin technology or software; and
  – Certain commodities produced in any plant or major component of a plant outside the U.S. that is a direct product of U.S.-origin technology or software.
 
Chinese companies should note that compliance with Chinese law or the laws of other foreign countries does not relieve them of the obligation to comply with the EAA and EAR.
 
Activities Prohibited under the EAR
 
If a company purchases a product covered by the EAR, that company is generally prohibited from engaging in any of the following activities without first obtaining a license or license exception from BIS (if applicable):
 
  – Exporting and re-exporting controlled items to certain listed countries (as determined based on the item being exported);
  – Re-exporting and exporting from abroad foreign-made items incorporating more than a de minimis amount of controlled U.S. content;
  – Re-exporting and exporting from abroad foreign-produced direct products of U.S. technology and software;
  – Engaging in actions prohibited by a denial order issued by BIS;
  – Exporting or re-exporting any item to prohibited end-users or for prohibited end-uses;
  – Exporting or re-exporting any item to embargoed nations;
Supporting certain weapons proliferation activities (if said company is a U.S. person);
  – Exporting or re-exporting an item through, or transiting such through, certain listed countries;
  – Violating any terms or conditions of a license, license exception, or order issued under the EAR; and
  – Knowingly proceeding with transactions that will cause, or has caused, a violation of the EAR.
 
Companies should note that BIS generally prohibits all import and export transactions involving sanctioned countries (i.e., Cuba, Iran, North Korea, Sudan, and Syria) without license authorization.
In the event that a company becomes aware of possible violations of the EAR, that company should report such violations to the BIS, as voluntary self-disclosure is a mitigating factor in determining what sanctions may be imposed.
 
Why the EAR Matter
 
Failure to comply with the EAA and the EAR may result in significant administrative and criminal penalties for a Chinese company.
 
Administrative sanctions may include (a) civil monetary penalties for each violation of (i) up to $125,000 in non-egregious cases resulting from voluntary self-disclosure, (ii) up to $250,000 in non-egregious cases which BIS becomes aware of through means other than voluntary self-disclosure, (iii) at least $125,000 in egregious cases resulting from voluntary self-disclosure, and (iv) at least $250,000 in egregious cases which BIS becomes aware of through means other than voluntary self-disclosure; and (b) denial of export privileges.
 
Criminal penalties shall be imposed on parties who knowingly violate or conspire to, or attempt to violate, the EAR, and may include fines of up to $1 million per violation and/or imprisonment (with respect to individuals).
 

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COMM_a2
13. S.M. Wise: “DDTC and BIS Propose New Rules to Continue Export Control Reform Initiative”
(Source: Trade and Manufacturing Monitor, 21 May 2018.)
 
* Author: Scott M. Wise, Associate, swise@kelleydrye.com, Kelley Drye & Warren LLP, Washington DC.
 
As part of the ongoing Export Control Reform initiative, the Directorate of Defense Trade Controls (“DDTC”) and Bureau of Industry and Security (“BIS”) has issued proposed rules that would move certain items currently controlled on the International Traffic in Arms Regulations (“ITAR”) to the Export Administration Regulations (“EAR”). The proposed rules would move some items currently controlled under Categories I, II, and III of the U.S. Munitions List (“USML”), including certain firearms, guns and armament, and ammunition/ordnance to new Export Control Classification Numbers (“ECCNs”) on the EAR. After their publication in the Federal Register, there will be a 45-day comment period during which the agencies will accept public comments.
 
Specifically, the proposed rule targets for a move to the EAR products that are not inherently military, or do not possess characteristics that provide a military advantage to the U.S. These rules, once finalized, would reduce the compliance burden on exporters in the industry. However, the proposed rules do not represent a wholesale deregulation of the industry, as many items would remain highly controlled under the EAR’s “600-series” and other ECCNs, and would still require licenses to many destinations. Affected parties should carefully review the proposed rules and take the opportunity to comment on the proposed reforms.

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COMM_a3
14. Gary Stanley’s EC Tip of the Day
(Source: Defense and Export-Import Update; 21 May 2018. Available by subscription from gstanley@glstrade.com.)
 
* Author: Gary Stanley, Esq., Global Legal Services, PC, (202) 352-3059, gstanley@glstrade.com.
 
ITAR § 120.17(a)(4) provides that an export occurs through “releasing or otherwise transferring a defense article to an embassy or to any of its agencies or subdivisions, such as a diplomatic mission or consulate, in the United States.”

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TECEX/IM TRAINING EVENTS & CONFERENCES

(Source: Suzanne Palmer,
spalmer@exportcompliancesolutions.com.) 
 
* What: ITAR/EAR Boot Camp (Seminar Level I), Long Beach, CA
* When: July
10-11, 2018
* Sponsor: Export Compliance Solutions (ECS)
* ECS Speaker Panel:  Suzanne Palmer, Mal Zerden
* Register: Here or by calling 866-238-4018 or e-mail spalmer@exportcompliancesolutions.com
.
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TEC_a216. ECTI Presents “Welcome to the Club: An Overview of India’s Dual-Use and Defense Export Control Systems,” Webinar on 13 June

(Source: Danielle Hatch, danielle@learnexportcompliance.com)
 
* What: Welcome to the Club: An Overview of India’s Dual-Use and Defense Export Control Systems
* When: June 13, 2018; 1:00 p.m. (EDT)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Ryan Lynch Cathie
* Register: Here or Danielle Hatch, 540-433-3977, danielle@learnexportcompliance.com.
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ENEDITOR’S NOTES

 

* Arthur Conan Doyle (Sir Arthur Ignatius Conan Doyle KStJ DL; 22 May 1859 – 7 Jul 1930; was a British writer best known for his detective fiction featuring the character Sherlock Holmes. Originally a physician, in 1887 he published A Study in Scarlet, the first of four novels about Holmes and Dr. Watson. In addition, Doyle wrote over fifty short stories featuring the famous detective.)
  – “Mediocrity knows nothing higher than itself, but talent instantly recognizes genius.”
  – “It is an old maxim of mine that when you have excluded the impossible, whatever remains, however improbable, must be the truth.”
 

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EN_a318
. 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: 12 Apr 2018: 83 FR 15736-15740: CBP Decision No. 18-04; Definition of Importer Security Filing Importer (ISF Importer)
 
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: 17 May 2018: 83 FR 22842-22846: Revisions to the Unverified List (UVL)

  
*
FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR)
: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

  – Last Amendment: 19 Mar 2018:
83 FR 11876-11881: Inflation Adjustment of Civil Monetary Penalties 

 
*
FOREIGN TRADE REGULATIONS (FTR)
: 15 CFR Part 30
  – Last Amendment: 24 Apr 2018: 3 FR 17749-17751: Foreign Trade Regulations (FTR): Clarification on the Collection and Confidentiality of Kimberley Process Certificates
  – HTS codes that are not valid for AES are available
here.
  – The latest edition (30 Apr 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 approximately 250 footnotes containing case annotations, practice tips, Census/AES guidance, and explanations of the numerous errors contained in the official text. Subscribers receive revised copies in Microsoft Word every time the FTR is amended. The BAFTR is available by annual subscription from the Full Circle Compliance websiteBITAR subscribers are entitled to a 25% discount on subscriptions to the BAFTR. Government employees (including military) and employees of universities are eligible for a 50% discount on both publications at www.FullCircleCompiance.eu.  
 
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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: 4 May 2018: Harmonized System Update 1807, containing 289 ABI records and 60 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: 25 Apr 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_a0319
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.


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