18-0925 Tuesday “Daily Bugle”

18-0925 Tuesday “Daily Bugle”

Tuesday, 25 September 2018

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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  1. State/DDTC Seeks Comments on Form DS-2032, Statement of Registration
  1. Items Scheduled for Publication in Future Federal Register Editions
  2. Commerce/BIS: (No new postings.)
  3. State/DDTC: (No new postings.)
  4. EU Amends Restrictive Measures Concerning North Korea, Libya and Iraq
  5. UK/ECJU Posts Notice on European Commission Launching Survey on Draft Guidelines for ICPs
  1. Expeditors News: “India Delays Tariffs on Goods of US Origin”
  2. Fortune: “What South Korea Had to Give Up to Secure a Trade Deal With Trump”
  3. ST&R Trade Report: “Reminder: Oct. 9 Deadline to Request Exclusions from 25 Percent Tariff on China List 1 Goods”
  1. R.C. Burns: “Gun Smuggler Gets 51 Month Library Fine for Overdue Guns”
  1. FCC to Present U.S. Export Controls Awareness Training Course for Non-U.S. Organizations, 2 Oct in Bruchem, the Netherlands
  1. Bartlett’s Unfamiliar Quotations 
  2. Are Your Copies of Regulations Up to Date? Latest Amendments: ATF (15 Jan 2016), Customs (19 Sep 2018), DOD/NISPOM (18 May 2016), EAR (13 Sep 2018), FACR/OFAC (29 Jun 2018), FTR (24 Apr 2018), HTSUS (14 Aug 2018), ITAR (30 Aug 2018) 
  3. Weekly Highlights of the Daily Bugle Top Stories 



. State/DDTC Seeks Comments on Form DS-2032, Statement of Registration

(Source: Federal Register, 25 Sep 2018.) [Excerpts.]
83 FR 48496-48497: 60-Day Notice of Proposed Information Collection: Statement of Registration
* ACTION: Notice of request for public comment. …
* DATES: The Department will accept comments from the public up to November 26, 2018.
* ADDRESSES: You may submit comments by any of the following methods:
  – Web: Persons with access to the internet may comment on this notice by going to www.Regulations.gov. You can search for the document by entering “Docket Number: DOS-2018-0039” in the Search field. Then click the “Comment Now” button and complete the comment form.
  – Regular Mail: Send written comments to: Directorate of Defense Trade Controls, Attn: Andrea Battista, 2401 E St. NW, Suite H-1205, Washington, DC 20522-0112.
You must include the subject (PRA 60 Day Comment), information collection title (Statement of Registration), and OMB control number (1405-0002) in any correspondence.
* FOR FURTHER INFORMATION CONTACT: Direct requests for additional information regarding this collection to Andrea Battista, who may be reached at BattistaAL@state.gov or 202-663-3136.
  – Title of Information Collection: Statement of Registration.
  – OMB Control Number: 1405-0002.
  – Type of Request: Revision of a Currently Approved Collection.
  – Originating Office: Directorate of Defense Trade Controls (DDTC).
  – Form Number: DS-2032. …
  – Abstract: Pursuant to Part 122 of the International Traffic in Arms Regulation (ITAR), and section 38 of the Arms Export Control Act, 22 U.S.C. 2778, any person who engages in the United States in the business of manufacturing or exporting or temporarily importing defense articles or furnishing defense services is required to register with the Department of State, Directorate of Defense Trade Controls (DDTC). Pursuant to Part 129 of the ITAR, any U.S. person wherever located, and any foreign person located in the United States or otherwise subject to the jurisdiction of the United States, who engages in the business of brokering activities, is required to register with DDTC. DDTC uses the information provided by registrants to meet the mandates described in Part 122 and Part 129 of the ITAR. As appropriate, such information may be shared with other U.S. Government entities. This information is currently used in the review and action on registration requests and to ensure compliance with defense trade laws and regulations. …
  Anthony M. Dearth, Chief of Staff, Directorate of Defense Trade Controls, U.S. Department of State.

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OGS_a12. Items Scheduled for Publication in Future Federal Register Editions
(Source: Federal Register)

* Commerce; Industry and Security Bureau; RULES; Addition of Certain Entities to the Entity List, Revision of an Entry on the Entity List and Removal of an Entity from the Entity List [Publication Date: 26 September 2018.] 

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Official Journal of the European Union, 25 Sep 2018.)
* Council Implementing Regulation (EU) 2018/1284 of 24 September 2018 implementing Regulation (EU) 2017/1509 concerning restrictive measures against the Democratic People’s Republic of Korea
* Council Implementing Regulation (EU) 2018/1285 of 24 September 2018 implementing Article 21(5) of Regulation (EU) 2016/44 concerning restrictive measures in view of the situation in Libya
* Commission Implementing Regulation (EU) 2018/1286 of 24 September 2018 amending Council Regulation (EC) No 1210/2003 concerning certain specific restrictions on economic and financial relations with Iraq
* Council Implementing Decision (CFSP) 2018/1289 of 24 September 2018 implementing Decision (CFSP) 2016/849 concerning restrictive measures against the Democratic People’s Republic of Korea
* Council Implementing Decision (CFSP) 2018/1290 of 24 September 2018 implementing Decision (CFSP) 2015/1333 concerning restrictive measures in view of the situation in Libya

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UK/ECJU, 25 Sep 2018.)
The European Commission, in conjunction with member states, has produced draft guidance on the core elements that should be included in internal compliance programmes (ICPs).
Effective ICP programmes are a key element of the Commission’s proposals to modernise dual-use export controls in council regulation (EC) 428/2009. Hence the development of this non-binding guidance on best practice.
Action for exporters
The Commission has invited comments from European industry on this draft guidance via
an online survey.
The export control joint unit (ECJU) agrees this is an important issue and encourages exporters to give their views. Any responses should be made direct to the European Commission via the survey.
The survey is open now and will close on 15 November 2018.

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Expeditors News, 24 Sep 2018.)
On September 17, 2018, the Government of India’s Ministry of Finance delayed the implementation of previously announced tariffs on goods of U.S. origin until November 2, 2018.
The list of tariffs that was originally sent to the World Trade Organization (WTO) in May contained additional rates of tariffs on a variety of agricultural, textile, steel and aluminum, and other goods. The list of tariffs is in response to U.S. tariffs on steel and aluminum products from India.
The notification published in the Gazette of India can be found
The WTO notice from May can be found

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Fortune, 25 Sep 2018.)
President Donald Trump has signed the first trade deal of his presidency: a revamped version of the six-year-old KORUS agreement with South Korea.
  “From day one, I promised the American people that I would renegotiate our trade deals to ensure that our agreements were fair and reciprocal,” said Trump after the signing. “The new U.S.-Korea agreement includes significant improvements to reduce our trade deficit and to expand opportunities to export American products to South Korea. In other words, we are now going to start sending products to South Korea.”
As with many other countries, Trump had been incensed at the fact that South Korea sells more to U.S. consumers than it buys from American exporters-the U.S. trade deficit in goods was $22.9 billion last year, though as the U.S. exports many services to South Korea, the overall deficit was just $10.7 billion.
So what is in the revamped KORUS that makes it a better deal for the U.S.?
The big focus is on cars, a strong point for the Korean economy. Under the new deal, each American auto exporter will get to send 50,000 vehicles annually to South Korea that meet U.S. safety standards, rather than Korean safety standards.
That’s a doubling of the quota. But is it meaningful? Not hugely, as U.S. automakers currently don’t sell anything close to 25,000 cars per year in South Korea.
However, the new deal also extends until 2041 a 25% U.S. import tariff on South Korean trucks. That tariff had been due to phase out by 2021, leaving U.S. truck manufacturers more exposed to South Korean competition.
Still on the vehicle front, the South Koreans agreed to let gas-powered cars from the U.S. be sold as compliant with Korean emissions regulations, as long as they comply with U.S. testing procedures.
South Korea also agreed to relax customs checks that validate the origins of exports, and to tweak drug pricing so as to give fairer treatment to U.S. pharmaceutical exports.
Then there’s steel-U.S. tariffs on which have hurt U.S. automakers. South Korea agreed to cut 30% of its steel exports to the U.S., in exchange for which it gets an exemption from the White House’s 25% tariffs on steel imports. South Korea is the third-largest steel exporter to the U.S., so this is crucial for the country.
The South Korea parliament still has to approve the deal, so it is not quite set in stone yet. But it’s a win for the White House, which has lashed out across the world over trade issues but, until now, not resolved any disagreements.
Of course, South Korea has an ulterior motive for shaking hands. President Moon Jae-in wants peace with North Korea, and that means having U.S. support for talks. South Korean officials worked hard to settle the revised KORUS arrangement in order to avoid complications in the other matter.

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Sandler, Travis & Rosenberg Trade Report, 25 Sep 2018.) [Excerpts.]
Readers are reminded that Oct. 9 is the deadline for submitting requests for exclusions from the additional 25 percent tariff imposed as of July 6 on so-called List 1 goods imported from China. This tariff, which affects 818 tariff lines, was levied in response to a Section 301 investigation determination that China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory. Any exclusions granted will be retroactive to July 6 and extend one year after the exclusion determination is published in the Federal Register. …
Unlike the process for requesting exclusions from the global Section 232 tariffs on steel and aluminum, any interested person, including trade associations, may requests exclusions from the Section 301 tariffs. Each request must include the following information.
  – identification of the product in terms of the physical characteristics that distinguish it from other products within the covered eight-digit HTSUS subheading (requests that identify the product in terms of the identity of the producer, importer, or ultimate consumer; actual or chief use; or trademarks or trade names will not be considered)
  – applicable ten-digit HTSUS number
  – annual quantity and value of Chinese-origin product the requester purchased in each of the last three years
In addition, each request should address the following factors.
  – whether the product is available only from China and whether a comparable product is available from sources in the U.S. and/or third countries
  – whether the additional tariff on the product would cause severe economic harm to the requester or other U.S. interests
  – whether the product is strategically important or related to “Made in China 2025” or other Chinese industrial programs
Requesters may also submit information on the ability of U.S. Customs and Border Protection to administer the exclusion. …

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Export Law Blog, 24 Sep 2018. Reprinted by permission.)
* Author: R. Clifton Burns, Esq., Bryan Cave LLP, Wash DC, Clif.Burns@bryancave.com, 202-508-6067).
So, if you and I went to the Haskell Free Library and Opera House, half of which is in Derby Line, Vermont, and the other half of which is in Stanstead, Québec, we would think of it as a clever gimmick designed to attract tourists to boring little towns with little else to offer. But, were you and I genius criminals, we would see it as a venue for the perfect crime.
Here’s why. If you’re from Canada, you park in Canada, and you can walk to the only entrance on the U.S. side without clearing Canadian or U.S customs. And it’s the same thing on the way out if you go straight back to your car in the parking lot in Canada. So, this brilliant criminal gang cooked up the plan to buy guns in the United States and then leave them in a backpack in the library’s bathroom. Then the Canadian gang member would later retrieve the guns and take them back to Canada without ever having to worry about U.S. or Canadian Customs. Brilliant! Foolproof! Genius!
Of course, never underestimate cops in funny hats and red coats who ride around on horses. They’re much smarter than they appear. A joint operation nabbed the Canadian charged with retrieving the gun-filled backpack from the library’s men’s room. That Canadian, Alex Vlachos, was just sentenced to 51 months in U.S. prison for his role in the transnational library smuggling scheme. He will be given credit for the 43 months he spent in U.S. prison after being extradited to the United States. Do you think he spent much time in the prison library?

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FCC to Present U.S. Export Controls Awareness Training Course for Non-U.S. Organizations, 2 Oct in Bruchem, the Netherlands

(Source: Full Circle Compliance, events@fullcirclecompliance.eu.)
Our next academy course is specifically designed for beginning compliance officers and professionals who want to enhance their knowledge on the latest ITAR/EAR requirements and best practices.  The course will cover multiple topics regarding U.S. export controls that apply to organizations outside the U.S., such as: the regulatory framework, including the latest and anticipated regulatory amendments, key concepts and definitions, classification and licensing requirements, handling (potential) non-compliance issues, and practice tips to ensure compliance with the ITAR and EAR.
* What: Awareness Course U.S. Export Controls: ITAR & EAR from a Non-U.S. Perspective 
* When: Tuesday, 2 Oct 2018, 9 AM – 5 PM (CEST)
* Where: Landgoed Groenhoven, Bruchem, the Netherlands
* Sponsor: Full Circle Compliance (FCC)
* Instructors: Ghislaine Gillessen, Mike Farrell, and Alexander P. Bosch 
* Information & Registration: HERE or via

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Shel Silverstein (Sheldon Allan “Shel” Silverstein; 25 Sep 1930 – 10 May 1999; was an American writer known for his cartoons, songs, and children’s books. He styled himself as Uncle Shelby in some works. Translated into more than 30 languages, his books have sold over 20 million copies. He was the recipient of two Grammy Awards, as well as a Golden Globe and Academy Award nomination.)
  – “Comfortable shoes and the freedom to leave are the two most important things in life.”   
* Barbara Walters (Barbara Jill Walters; born 25 Sep 1929; is an American broadcast journalist, author, and television personality. Walters is known for having hosted a variety of television programs, including “Today”, “The View”, “20/20”, and “ABC Evening News”.)
  – “Show me someone who never gossips, and I will show you someone who is not interested in people.”

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. 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.
: 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. 
: 19 CFR, Ch. 1, Pts. 0-199
  – Last Amendment: 19 Sep 2018: 83 FR 47283-47284: Extension of Import Restrictions Imposed on Archaeological Material From Cambodia  


  – 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 

: 15 CFR Subtit. B, Ch. VII, Pts. 730-774

  – Last Amendment: 13 Sep 2018: 83 FR 46391-46392: Addition of Certain Entities to the Entity List, Revision of Entries on the Entity List and Removal of Certain Entities From the Entity List; Correction

: 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

  – Last Amendment: 29 June 2018: 83 FR 30541-30548: Global Magnitsky Sanctions Regulations; and 83 FR 30539-30541: Removal of the Sudanese Sanctions Regulations and Amendment of the Terrorism List Government Sanctions Regulations 

: 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
  – 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.  
, 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: 14 Aug 2018: Harmonized System Update 1812, containing 27 ABI records and 6 harmonized tariff records.

  – HTS codes for AES are available 
  – HTS codes that are not valid for AES are available 
  – Last Amendment: 30 Aug 2018:
83 FR 44228-44229
, USML Chapter XI(c).

  – The only available fully updated copy (latest edition: 30 Aug 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
. BAFTR subscribers receive a 25% discount on subscriptions to the BITAR, please
contact us
to receive your discount code.

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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 

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* 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, Alex Witt. The Ex/Im Daily Update is emailed every business day to approximately 6,000 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.  If you would to submit material for inclusion in the The Export/Import Daily Update (“Daily Bugle”), please find instructions here.

* 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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