18-1003 Wednesday “Daily Bugle”

18-1003 Wednesday “Daily Bugle”

Wednesday, 3 October 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. Commerce/BIS Posts Notice on Membership of the Performance Review Board
  1. Items Scheduled for Publication in Future Federal Register Editions
  2. Commerce/BIS: (No new postings.)
  3. DoD/DSS Announces Small Business Industry Day on 30 Oct
  4. DHS/CBP Amends an Unliquidated ACS Drawback Claim in ACE
  5. State/DDTC: (No new postings.)
  6. Australia DoD/DEC Posts Notice on Outreach Event in Adelaide on 6 Nov
  1. Defense News: “Mattis Says US-France in Talks about Loosening Export Limits on Cruise Missile”
  2. Expeditors News: “CBP Considers New CTPAT Benefits”
  1. C. Lam & H. Zhang: “Demonstrating Reasonable Care to China Customs Can Help Importers Avoid Headaches”
  2. M. Lester: “ICJ Grants Iran’s Provisional Measures against U.S. Sanctions”
  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 (26 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 



. Commerce/BIS Posts Notice on Membership of the Performance Review Board

(Source: Federal Register, 3 Oct 2018.) [Excerpts.]
83 FR 49908: Membership of the Performance Review Board for EDA, NTIA, BIS and MBDA
* AGENCY: EDA, NTIA, BIS, and MBDA Department of Commerce.
* ACTION: Notice of Membership on the EDA, NTIA, BIS and MBDA’s Performance Review Board.
* SUMMARY: The EDA, NTIA, BIS and MBDA, Department of Commerce (DOC), announce the appointment of those individuals who have been selected to serve as members of the Performance Review Board.
* DATES: The period of appointment for those individuals selected for EDA, NTIA, BIS and MBDA’s Performance Review Board begins on October 3, 2018.
* FOR FURTHER INFORMATION CONTACT: Joan Nagielski, U.S. Department of Commerce, Office of Human Resources Management, Department of Commerce Human Resources Operations Center, Office of Employment and Compensation, 14th and Constitution Avenue NW, Room 50013, Washington, DC 20230, at (202) 482-6342.
   The name, position title, and type of appointment of each member of the Performance Review Board are set forth below:
   (1) Department of Commerce, Bureau of Industry and Security (BIS)
     – John Sonderman, Deputy Director for Office of Export Enforcement, Career SES …
   Dated: September 28, 2018.
Joan M. Nagielski, Human Resources Specialist, Office of Employment and Compensation, Department of Commerce Human Resources Operations Center, Office of Human Resources Management, Office of the Secretary, Department of Commerce.

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

* Commerce; Industry and Security Bureau; NOTICES; Export Privileges; Denials [Publication Date: 4 October 2018.]:
  – Edgar Garza-Sanchez
  – Edward Alexander Duenas
  – Erik Villasana
  – Francisco Xavier Martinez
  – Juan Diego Madrid
  – Rolando Armando Madrid
  – Ruben Arnoldo Madrid
[Editor’s Note: The above items have already been included in the Tuesday, 2 October 2018, Daily Bugle.]
* State; RULES; Regulatory Reform Revisions to the International Traffic in Arms Regulations [Publication Date: 4 October 2018.]
* Treasury; Foreign Assets Control Office; NOTICES; Blocking or Unblocking of Persons and Properties [Publication Date: 4 October 2018.]

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DoD/DSS, 3 Oct 2018.)
The DSS Small Business Program Office is holding an FY19 Small Business Industry Day on October 30, 2018, at the Gray Research Center, Marine Corps Base Quantico. More information is available on the
flyer. The event is only open to 200 participants. To register, click

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CSMS #18-000585, 3 Oct 2018.)
ACE has been updated to allow for amendments of unliquidated drawback claims previously filed and accepted in ACS. To amend a claim, filers must contact the Drawback Specialist at the port of filing and request the claim be returned to trade control. Amended claims must be refiled utilizing a CORE provision and must satisfy current CORE data requirements and business rules. The filing timeframes defined in Part 191 will be enforced.
For Programming Guidance see CSMS #18-000569.
Questions regarding this update may be directed to OTDRAWBACK@cbp.dhs.gov.
  – Related CSMS No. 18-000569
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Australia DoD/DEC, 3 Oct 2018.)
Defence Export Controls (DEC), within the Department of Defence is commencing another year of outreach programs.

Our next outreach event for 2018 will be held in Adelaide on Tuesday 6th November 2018, at the University of Adelaide. Please visit our Eventbrite page for location details.

An event will also be held in Sydney in November.

The outreach program will cover the requirements exporters must meet when exporting controlled goods and technologies. These include military or commercial items that may have potential military end use or could be used in developing chemical, biological or nuclear weapons systems.

The program is aimed at small to medium enterprises who export and want to learn more about:

  – Export control regulations,
  – Export controls specific to defence industry or academic and research organisations, and
  – The whole-of-government approach to Australia’s export landscape.
You can attend an outreach event in:
  – Adelaide 06 November 2018, registration will open 15 October 2018
  – Sydney 13 November 2018, registration will open 15 October 2018

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Defense News, 2 Oct 2018.) [Excerpts.]
U.S. defense officials are in detailed talks with French counterparts on a request for the sale of American components built into French cruise missiles, U.S. Defense Secretary Jim Mattis said.
Asked by a French journalist about Washington blocking the sale of the Scalp long-range weapon to Egypt and Qatar, Mattis said American and French staff were meeting on that very issue even as a press conference was being held.
  “We discussed this,” he said. “We also have our staffs meeting. We have an invitation out to France to answer two final questions. The meetings are going on as we speak.”
Mattis, on his first visit to Paris as defense secretary, was speaking at a joint press conference with his French counterpart, Armed Forces Minister Florence Parly, held at Brienne House.
The two issues to be resolved target “certain technologies” that the United States only shares with its closest allies, including France, and whether that technology can be further transferred, and how France can protect that technology, he said.
  “Right now we don’t have a final answer but it is all going in the right direction,” he said. “And it was a very fruitful discussion today. Our staffs are working this forward right now.”
The conundrum stems from the French sale to Egypt and Qatar of Scalp cruise missiles to arm Dassault Rafale fighter jets. The weapons include U.S. parts, leading Washington to evoke the International Traffic in Arms Regulations regime. …

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Expeditors News, 2 Oct 2018.)
On September 19, 2018, U.S. Customs and Border Protection (CBP) published a list of proposed benefits for the Customs-Trade Partnership Against Terrorism (CTPAT) program. The list includes eight possible program benefits:
  – CTPAT portal development for Trade Compliance;
  – Reconciliation;
  – Penalty Mitigation/Offset;
  – Expedited Rulings;
  – Release of Goods/Post Release Exams;
  – CTPAT Defender (Identity Theft Program);
  – Exemption from random NIIs;
  – Automation of Confidential Manifest requests.
Additionally, CBP also outlined the list of actions required for the roll out of the Commercial Customs Operations Advisory Committee’s (COAC) trusted trader program.
The Trusted Trader Trade Compliance document may be found
The COAC quarterly meeting agenda may be found

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* Authors: Colbert Lam, Esq.,
clam@strtrade.com; and Harry Zhang, Esq.,
hzhang@strtrade.com.  Both of Sandler, Travis & Rosenberg, P.A.
A [recent] case … illustrates the benefit of companies importing into China being able to show China Customs evidence that they exercised reasonable care in the customs declaration process. Doing so can help demonstrate that a customs regulation infraction occurred without intent, which will typically be treated administratively with no penalty. On the other hand, a determination that a violation was committed intentionally will not only result in a penalty but will also downgrade the importer’s customs ranking.
During a recent audit, China Customs challenged the Harmonized System code declared by the importer and concluded that it was due to an incorrect declaration. The case was subsequently referred to the Anti-Smuggling Bureau to determine if a penalty is to be assessed.
However, ST&R found that the importer consulted certified third-party classifiers to determine the proper classification. Although the findings of these classifiers are not binding on China Customs, they had received an endorsement from the local Customs Bureau as expert in the field of classification. In addition, the product at issue had been selected for physical inspections during customs clearance in the past and no red flags had been raised, including with respect to the HS code.
While both these factors are viewed as evidence of reasonable care exercised by the importer, it is important to note that unlike U.S. Customs and Border Protection, China Customs has yet to formalize a regulatory framework on the steps companies should take to meet this standard. In ST&R’s case, the importer’s reasonable care efforts were identified and highlighted to the audit official and forwarded to the ASB as considerations against penalty assessment. If the ASB rules otherwise, the importer will be able to appeal.
Using reasonable care may also help expedite import shipments. One recent reform initiative at China Customs focuses on accelerating customs clearance by allowing the release of goods based on a self-declaration by the importer with minimal review. This reform includes a more stringent post-importation audit process to enforce compliance, thus highlighting the importance of importers exercising reasonable care in preparing their customs declarations.

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European Sanctions Blog, 3 Oct 2018.)
* Author: Maya Lester, Esq., Brick Court Chambers,
, +44 20 7379 3550.
The International Court of Justice (“ICJ”) has held today, in Iran’s application for provisional measures (see previous blog) that pending resolution of the case, the USA must:
(1) Remove, by means of its choosing, any impediments arising from the measures announced on 8 May 2018 to the free exportation to the territory of the Islamic Republic of Iran of: (i) medicines and medical devices; (ii) foodstuffs and agricultural commodities; and (iii) spare parts, equipment and associated services (including warranty, maintenance, repair services and inspections) necessary for the safety of civil aviation.
(2) Ensure that licences and necessary authorisations are granted and that payments and other transfers of funds are not subject to any restriction in so far as they relate to the goods and services referred to in point (1).
Both parties must also refrain from any action which might aggravate or extend the dispute before the Court or make it more difficult to resolve. See OrderSummary of OrderPress Release, and Separate Opinion.

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George Bancroft (3 Oct 1800 – 17 Jan 1891; was an American historian and statesman who was prominent in promoting secondary education both in his home state, at the national and international level. During his tenure as U.S. Secretary of the Navy, he established the United States Naval Academy at Annapolis in 1845.)
 – “By common consent gray hairs are a crown of glory; the only object of respect that can never excite envy.”
James Herriot (James Alfred “Alf” Wight; 3 Oct 1916 – 23 Feb 1995; known by the pen name James Herriot, was a British veterinary surgeon and writer, who used his many years of experiences as a veterinary surgeon to write a series of books each consisting of stories about animals and their owners. He is best known for these semi-autobiographical works, beginning with If Only They Could Talk in 1970, which spawned a series of movies and television series, including a 1975 film titled All Creatures Great and Small.)
  – “I have felt cats rubbing their faces against mine and touching my cheek with claws carefully sheathed. These things, to me, are expressions of love.”

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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: 26 Sep 2018: 83 FR 48532-48537: 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

: 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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