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20-0110 Friday “Daily Bugle”

20-0110 Friday “Daily Bugle”

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Friday, 10 January
2020

[No items of interest today.]  

  1. Items Scheduled for Publication in Future Federal Register Editions
  2. Commerce/BIS: (No new postings.)
  3. DoD/DSCA: “DSCA Launches New Workforce Certification Program”
  4. State/DDTC: (No new items today.)
  1. Law.com: “What In-House Counsel Need to Know About New Export Control on AI”
  2. Washington Post: “U.S. Report Calls for Sanctions on China for Human Rights Abuses, Influence Operations”
  3. WorldECR: “China Publishes New Draft of Export Control Law”
  1. DLA Piper: “Commerce Imposes Export Licensing Requirement on Geospatial Imagery Software”
  2. Womble Bond Dickinson: “Successfully Navigating Export Controls in a Fast Changing Regulatory and Political Environment”
  3. Wiggin & Dana: DOJ Enhances Incentives to Submit VSDs for Criminal Violations of Export Control and Sanctions Laws
  1. ECTI Presents the Paradox of Compliance: ITAR and Anti-Discrimination Concerns Webinar: February 11, 2020 
  2. Full Circle Compliance Presents: Export Compliance Training Seminars 
  3. List of Approaching Events: 124 Events Posted This Week, Including 31 New Events
  1. Bartlett’s Unfamiliar Quotations
  2. Are Your Copies of Regulations Up to Date? Find the Latest Amendments Here.
  3. Weekly Highlights of the Daily Bugle Top Stories

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EXIMITEMS FROM TODAY’S FEDERAL REGISTER

[No items of interest today.]
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OGSOTHER GOVERNMENT SOURCES

OGS_a11
. Items Scheduled
for Publication in Future Federal Register Editions
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OGS_a22
.
Commerce/BIS: (No new postings.)

(Source: Commerce/BIS)

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OGS_a33
. DoD/DSCA: “DSCA Launches New Workforce Certification Program”

(Source: 
DoD/DCSA
, 2 Jan 2020.)
 
The Defense Security Cooperation Agency (DSCA) launched the Department of Defense (DOD) Security Cooperation Workforce Certification Program on Jan. 1, 2020, for civilian and military members of the Security Cooperation workforce.  See Printer Friendly Version here.
 
[Editor’s Note: DSCA has activated the security policy HTTP Strict Transport Security (HSTS) on their websites, which means that some browsers cannot connect to them without a secure connection, and will receive the warning “Potential Security Issue”.]

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(Source: State/DDTC)

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COMNEWS

NWS_a15.
Law.com: “What In-House Counsel Need to Know About New Export Control on AI”

(Source:
Law.com, 9 Jan 2020.) [Excerpts.]
 
Trade lawyers say new export restrictions on artificial intelligence software used to analyze geospatial imagery could cover a broad array of industries, from self-driving cars to real estate development.
 
The U.S. Department of Commerce’s Bureau of Industry and Security kicked off the New Year by enacting the agency’s first export restrictions on a so-called “emerging” technology-artificial intelligence software used to analyze geospatial imagery, such as satellite images.  
 
The interim control took effect Monday, which means the Committee on Foreign Investment in the United States also could begin scrutinizing geospatial AI software as a technology that is critical to national security under the Foreign Investment Risk Review Modernization Act.  
 
Stakeholders in the AI sector had been waiting for the Commerce Department to enact controls on emerging technology for more than a year. Now, tech companies are eager to know whether their software falls under the restriction, which could cast a net over a wide range of industries, according to international trade lawyers. …

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NWS_a26.
Washington Post: “U.S. Report Calls for Sanctions on China for Human Rights Abuses, Influence Operations”
(Source: Washington Post, 10 Jan 2020.) [Excerpts.]
 
A U.S. government commission led by bipartisan lawmakers urged the Trump administration to enact sanctions against Chinese officials and companies for human rights abuses and to develop stronger policies to counteract what it called China’s intensified political influence operations abroad.
 
The Congressional-Executive Commission on China argued for tougher and more cohesive U.S. action against Beijing in a new annual report that detailed the Chinese government’s crackdown against religious minorities and labor activists, its expansion of digital surveillance and censorship, and its political influence activities around the world. …

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NWS_a37.
WorldECR: “China Publishes New Draft of Export Control Law”
(Source: WorldECR, 10 Jan 2020.) [Excerpts.]
 
China has published the second draft of its first-ever export control law. The draft law, which is open for public comment until 26 January, is expected to come into force later this year.
 
Its scope includes both traditional and deemed exports of military, nuclear and dual-use items, as well as other national security-related goods, technologies and services. While the draft says that control lists will be published, an entity list is also specified — but this, it is thought, may be for internal use only.
 
Under the law, licenses must be issued for the export, re-export, transit or transshipment of controlled items from China to other countries (including Taiwan, Hong Kong and Macao), and for the transfer of controlled items to foreign individuals or entities within China. For items not covered by the control lists, the law specifies a temporary control period of up to two years.
The law also requires exporters to establish internal compliance plans. …

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COMCOMMENTARY

COM_a18.
DLA Piper: “Commerce Imposes Export Licensing Requirement on Geospatial Imagery Software”
(Source: DLA Piper Insights, 8 Jan 2020)
 
* Principal Author: Thomas M. deButts, Esq., DLA Piper.
 
Effective January 6, 2020, the US Department of Commerce, Bureau of Industry and Security (BIS) has imposed new export controls on geospatial imagery software. Geospatial imagery software is used in such areas as self-driving vehicles, drone navigation, remote sensing, and analysis of earth imagery.  Specifically, this new export control, imposed under Export Control Classification Number (ECCN) 0D521 on the Commerce Control List, now requires that an export license be obtained for software specially designed to automate the analysis of geospatial imagery as more specifically defined below.   
ECCN 0D521 No. 1

Geospatial imagery “software” “specially designed” for training a Deep Convolutional Neural Network to automate the analysis of geospatial imagery and point clouds, and having all of the following:
 
(1) Provides a graphical user interface that enables the user to identify objects (e.g., vehicles, houses, etc.) from within geospatial imagery and point clouds in order to extract positive and negative samples of an object of interest;
(2) Reduces pixel variation by performing scale, color, and rotational normalization on the positive samples;
(3) Trains a Deep Convolutional Neural Network to detect the object of interest from the positive and negative samples; and
(4) Identifies objects in geospatial imagery using the trained Deep Convolutional Neural Network by matching the rotational pattern from the positive samples with the rotational pattern of objects in the geospatial imagery.
 
Technical note: A point cloud is a collection of data points defined by a given coordinate system. A point cloud is also known as a digital surface model.
 
The quoted terms above have specific definitions in the Export Administration Regulations (EAR) that should be consulted for further analysis. The only license exception available for this software at present is for exports, reexports, and transfers (in-country) made by or consigned to a department or agency of the US government that is within the scope of section 740.11(b)(2)(ii) of EAR License Exception GOV.  Canada is also exempt from this new licensing requirement.
 
Companies that export their software and believe their software is described above should immediately take action to comply with the new export licensing requirement. Companies that need to continue exporting their software and believe their software is related to that described above, but not described above, should seek a written export control classification determination from BIS to ensure that such software is not misclassified into the new category of controlled geospatial imagery software. 
 
CFIUS considerations
 
Companies that produce, design, test, manufacture, fabricate, or develop a software described above may now be (if they were not previously) operating within the category of “critical technologies” as defined in the regulations of the Committee on Foreign Investment in the United States (CFIUS). Notably, however, BIS did not issue this new export control under the specific authority of Section 1758 Export Control Reform Act of 2018 (Emerging and Foundational Technologies), nor did it reference this control as an emerging or foundational technology control, and BIS has imposed only a Regional Stability (RS) control on this software, so the new control does not meet the technical definition of “critical technologies” in the CFIUS regulations.
 

Comments on the new controls will be accepted by BIS through March 6, 2020.

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COM_a39.
Womble Bond Dickinson: “Successfully Navigating Export Controls in a Fast Changing Regulatory and Political Environment”
(Source: National Law Review, 8 Jan 2020.) [Excerpts.]
 
* Principal Author: James K. Kearney, Esq., Womble Bond Dickinson (US) LLP.
 
I recently moderated a panel of legal experts on complying with multijurisdictional export and trade controls who provided an overview of the domestic and international regulatory environment to an audience of corporate counsel from companies of all sizes, ranging from the largest multinationals to emerging companies just beginning to expand in the global marketplace.  It is an important and timely topic given the tension and uncertainty currently at play in the closely-connected geo-political environment in which all companies are doing business.  The litany of potential issues relating to export and other trade controls can seem overwhelming to even experienced corporate counsel when dealing with them for the first time.
 
The largest companies have their own export and trade control experts in-house, but even the in-house experts have to be on their toes to keep track of all the issues, given the complexity of overlapping regulatory environments.  It is a challenge for all in-house counsel to deal with the multitude of national and international regulatory regimes as their company develops new products and prepares to enter new markets.
 
The main message that I have to deliver to the corporate counsel audience hasn’t changed much over the more than 30 years that I’ve been doing this work.  I advise corporate counsel not to worry about every possible issue in considering the potential risks of export controls.  Fortunately, any one business doesn’t have to address all risks.   Keep your focus narrow and concentrate on your own company’s products and services and the specific markets where they are sold when developing your export control compliance program. …
 
Knowing which countries’ laws apply to your company’s business is a critical first step.  All trading nations have export control laws and regulations.  Of particular concern to most clients are the regulatory schemes of the biggest players, like the US, countries in the European Union and China, but other countries have their own regimes and there are also international agreements that govern the export control of arms, biological and chemical items, missile technology, civil nuclear items, and other products where there may be restrictions in place.
 
US export controls govern the release of strategically important technologies and products in order to enhance national security and advance national policies.  The Export Controls Act and the Export Administration Regulations (EAR) are at the center of our national and regulatory structure in this area, along with the Arms Export Control Act and International Traffic in Arms Regulations (ITAR).
 
But identifying laws and regulations is just the starting point.  Understanding how these laws are enforced is equally important.   As anyone following the news knows, the rules confronting companies doing business globally are currently subject to an increasing interplay between policy and politics.  The use of sanctions and tariffs as levers to accomplish trade policy goals adds another dimension to the global regulatory landscape.  The simmering trade war with China is, of course, the primary example of this trend. … 
 
Sometimes the temptation is to create export compliance plans that attempt to address all possible risks, losing sight of the actual risks affecting a particular business.  But, each company’s risk profile and solutions to reduce risks will be different.  Smaller companies, in particular, can create problems for themselves while developing their compliance programs if they mirror big multinationals and attempt to address every issue.  Rather, a successful export compliance program depends upon conducting a realistic risk assessment that identifies your company’s unique risks and then structuring a program that credibly controls for those risks.  If and when federal authorities examine your program, they will be looking at whether it addresses your company’s particular risk profile, and therefore is reasonably designed to prevent violations and uncover violations if they do occur.  They will be looking for a program that makes sense for you, so an unnecessarily complex program addressing risks your company will not face will only serve to raise red flags in the eyes of the enforcement team.  …
 
I suggest starting with an audit of the business — what are you selling and where are you selling it — and building from there, constructing a matrix of the regulations (national and international) that relate to the particular products you sell and the particular countries in which you do business.  The idea is to focus on what you need to do to be a reasonably compliant business.  As part of the process, you will need to identify who in the business has acted or should act as focal points for the compliance program, who needs to be trained, and what kind of written policies are needed to provide consistent guidance across your entire organization.
 

Risk assessment should be a regular and ongoing commitment; changes in business activities and strategies will cause changes in risk profiles that may require adjusting existing policies and procedures.  So, scalability of your compliance program is a must. You will need to build flexibility into your program so that you can reassess and modify your efforts to account for new products and technology as they come along.  …

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wiggin10.
Wiggin & Dana: “DOJ Enhances Incentives to Submit VSDs for Criminal Violations of Export Control and Sanctions Laws”
 
* Principal Author: David H. Laufman, Esq., Wiggin & Dana LLP
 
On December 13, 2019, the National Security Division (NSD) of the Department of Justice (DOJ) issued revised policy guidance for business organizations governing voluntary self-disclosures (VSDs) to NSD’s Counterintelligence and Export Control Section (CES) regarding potentially criminal violations of U.S. export control and sanctions laws. The new guidance supersedes the original guidance issued in October 2016, and is aimed at encouraging more companies to submit voluntary self-disclosure (VSDs). For companies that voluntarily self-disclose potentially willful violations, fully cooperate, and implement timely and appropriately remediation, there is now a presumption that they will receive a non-prosecution agreement (NPA) and will not be assessed a fine, absent aggravating factors.
 
As before, NSD is seeking VSDs only with respect to matters involving “potentially willful” – and therefore criminal — violations of the statutes implementing the primary U.S. export control and sanctions regimes – i.e., the Arms Export Control Act, the Export Control Act, and the International Emergency Economic Powers Act. DOJ is not seeking, nor does the guidance concern, disclosures of civil violations made to regulatory enforcement agencies like the Directorate of Defense Trade Controls (DDTC) at the Department of State, the Office of Foreign Assets Control (OFAC) at the Department of the Treasury, or the Bureau of Industry and Security (BIS) at the Department of Commerce. Willful conduct disclosed only to regulatory enforcement agencies, but not to DOJ, will not qualify for the maximum benefits available under the new DOJ guidance.
 
Not every company will be able to meet all the requirements to qualify for the maximum benefits available under the new guidance. That DOJ has now clearly delineated such benefits, however, makes the submission of a VSD a more attractive option for companies that have discovered evidence of willful violations.
 
Changes in New VSD Policy.
Clearly Identified Financial Benefit. The original 2016 guidance stated only that if a company voluntarily self-discloses potentially willful violations, fully cooperates, and appropriately remediates, it “may be eligible for a significantly reduced penalty, to include the possibility of a non-prosecution agreement (NPA), a reduced period of supervised compliance, a reduced fine and forfeiture, and no requirement for a monitor.” (Emphasis added.) The new policy establishes concrete benefits available to “a company [that] (1) voluntarily self-discloses export control or sanctions violations to CES, (2) fully cooperates, and (3) timely and appropriately remediates….” Specifically, in the absence of aggravating factors, there will now be a presumption that the company will receive a non-prosecution agreement and will not be required to pay any fine.
 
Certain aggravating factors may result in a more stringent resolution. These factors include (1) exports of items controlled for nuclear nonproliferation or missile technology reasons to a proliferation country; (2) exports of items known to be used in the construction of weapons of mass destruction; (3) exports to a Foreign Terrorist Organization or a Specially Designated Global Terrorist; (4) exports of military items to a hostile foreign power; (5) repeated violations, including similar administrative or criminal violations in the past; and (6) knowing involvement of upper management in the criminal conduct.
 
If aggravating factors do exist and they warrant an enforcement action other than a non-prosecution agreement (such as a deferred prosecution agreement or a guilty plea) – but “the company satisfies all other criteria” – DOJ will “accord, or recommend to a sentencing court,” a fine that is at least 50 percent lower than what would otherwise be available under the alternative fine provision set forth in 18 U.S.C. § 3571(d). Thus, the government “will cap the recommended fine at an amount equal to the gross gain or gross loss.” In addition, DOJ will not require the appointment of a monitor if, at the time of resolution, the company has implemented an effective compliance plan. (The guidance takes no position on the imposition of a monitor by DDTC, BIS, or OFAC.) Still, even in cases where a company receives a non-prosecution agreement, it will not be permitted to retain “any of the unlawfully obtained gain,” and it will be required to pay all disgorgement, forfeiture, and/or restitution resulting from the company’s misconduct.
 
The original 2016 guidance did not provide any presumption for companies regarding the disposition of VSDs submitted to CES, and it also did not identify any specific financial benefits that companies could obtain if they satisfied the criteria for a VSD. The omission of such benefits in the prior guidance contributed to skepticism among companies and their counsel regarding the net benefits of submitting VSDs to CES.
 
Submission of VSDs to Regulatory Agencies. The new guidance reaffirms (albeit, now in a footnote), that companies “should continue to make voluntary self-disclosures to appropriate regulatory agencies under existing procedures.” But it clarifies that a company will not qualify for the benefits of a VSD in any subsequent DOJ investigation if the company “identifies potentially willful conduct, but chooses to self-report only to a regulatory agency and not to DOJ….” (Emphasis added.) Thus, for example, a company submitting a VSD to DDTC regarding a potentially criminal violation of the International Traffic in Arms Control Regulations (ITAR) will not be eligible for the benefits available under the new DOJ guidance unless it has also timely submitted a VSD to DOJ.
 
Harmonization of Key Definitions. Although the 2016 guidance contained language defining key terms such as “Voluntary Self-Disclosure,” “Full Cooperation,” and “Timely and Appropriate Remediation,” the new guidance conforms these definitions to now mirror the definitions in similar guidance contained in other DOJ voluntary disclosure guidance, specifically, DOJ’s FCPA Corporate Enforcement Policy. Thus, companies which have identified multiple violations implicating both the FCPA and export control and sanctions laws can rely on a uniform set of key definitions in evaluating whether to submit a VSD.
 
Voluntariness.
For a company’s disclosure to be deemed “voluntary,” the company must satisfy three requirements. First, it must disclose information regarding its potentially willful conduct to CES “prior to an imminent threat of disclosure or government investigation.” Second, the company must disclose the conduct “within a reasonably prompt time after becoming aware of the offense,” and the burden is on the company to demonstrate timeliness. Third, the company must disclose “all relevant facts known to it at the time of disclosure, including as to any individuals substantially involved in or responsible for the misconduct at issue.”
 
The revised policy contains new guidance regarding disclosures based on information of potential export control or sanctions violations discovered through a merger or acquisition. It states that “[w]hen a company undertakes a merger or acquisition, uncovers misconduct by the merged or acquired entity through thorough and timely diligence or, in appropriate circumstances, through post-acquisition audits or compliance integration efforts, and voluntarily self-discloses the misconduct and otherwise takes action consistent with this Policy (including, among other requirements, the timely implementation of an effective compliance program at the merged or acquired entity, there will be a presumption of a non-prosecution agreement in accordance with and subject to the other requirements of this Policy.”
 
The revised policy omits footnote language in the original 2016 guidance stating that “NSD will not consider a self-disclosure to be voluntary where it is required by a plea agreement, DPA, NPA, or any other similar agreement.” DOJ provided no explanation for this omission, so its intentions are unclear. The omission could be construed to mean, however, that NSD is now open to considering disclosures in those circumstances to be voluntary under the revised VSD policy if a company first learns of new, potentially criminal conduct after executing one of these agreements and otherwise meets the specified requirements for a disclosure to be deemed voluntary.
 
The revised policy also omits, without explanation, footnote language in the original guidance stating that a VSD will be deemed voluntary if a whistleblower has previously informed the government of export control or sanctions violations, provided that the company is unaware of the whistleblower disclosure and submits a VSD before it learns of a government investigation. The revised policy does contain a new footnote stating that “[i]f a company makes a disclosure before it becomes aware of an ongoing non-public government investigation, the company will be considered to have made a voluntary self-disclosure.” This suggests that a company’s VSD could be deemed voluntary even if a whistleblower has lodged a non-public complaint with the government, so long as the company is unaware of the complaint.
 
Full Cooperation.
The new guidance replicates the original guidance’s requirements that a company must satisfy to receive credit for full cooperation:
   – “Disclosure on a timely basis of all facts relevant to the wrongdoing at issue, including all relevant facts gathered during a company’s internal investigation; attribution of facts to specific sources where such attribution does not violate the attorney-client privilege, rather than a general narrative of the facts; timely updates on a company’s internal investigation, including but not limited to rolling disclosures of information; all facts related to involvement in the criminal activity by the company’s officers, employees, or agents; and all facts known or that become known to the company regarding potential criminal conduct by all third-party companies (including their officers, employees, or agents).”
   – “Proactive cooperation, rather than reactive; that is, the company must timely disclose all facts that are relevant to the investigation, even when not specifically asked to do so. Additionally, where the company is aware of relevant facts not in the company’s possession, it must identify that evidence to [DOJ].”
   – “Timely preservation, collection, and disclosure of relevant documents and information relating to their provenance, including (a) disclosure of overseas documents, the locations in which such documents were found, and who found the documents, (b) facilitation of third-party production of documents, and (c) where requested and appropriate, provision of translations of relevant documents in foreign languages.” And in circumstances “[w]hen a company claims that the disclosure of overseas documents is prohibited due to data privacy, blocking statutes, or other reasons related to foreign law, the company bears the burden of establishing the prohibition. Moreover, a company should work diligently to identify all available legal bases to provide such documents.”
   – “When requested and appropriate, de-confliction of witness interviews and other investigative steps that a company intends to take as part of its internal investigation with steps that [DOJ] intends to take as part of its investigation.”
 
The new guidance recognizes that “not all companies will satisfy all of the components of full cooperation, whether because they decide to cooperate only later in an investigation or they timely decide to cooperate but fail to meet all of the criteria.” DOJ states that “such companies should be eligible for some [i.e., at least partial] cooperation credit if they provide all relevant information related to individual accountability…..” However, the benefits available in that circumstance “generally will be markedly less than full cooperation as defined….”
 
Companies will not be disadvantaged by making a preliminary disclosure to NSD before they have completed an internal investigation. The new guidance recognizes that “a company may not be in a position to know all of the relevant facts at the time of a voluntary self-disclosure, especially where only preliminary investigative efforts have been possible.” It explains that “[i]n such circumstances, a company should make clear that it is making its disclosure based on a preliminary investigation of assessment of information, but it should nonetheless provide a fulsome disclosure of the relevant facts known to it at that time.”
 
Consistent with more broadly applicable DOJ policy as set forth in the Justice Manual at § 9-28.720, the new guidance affirms that a company’s eligibility for cooperation credit is not dependent upon a waiver of the attorney-client privilege or work-product protection.
 
Timely and Appropriate Remediation.
To receive full credit for timely and appropriate remediation, a company must satisfy the following requirements:
   – “Demonstration of thorough analysis of causes of underlying conduct (i.e., a root cause analysis) and, when appropriate, remediation to address the root causes”;
   – “Implementation of an effective compliance program, the criteria for which will be periodically updated and which may vary based on the size and resources of the organization, but may include:
— The company’s culture of compliance, including awareness among employees that any criminal conduct, including the conduct underlying the investigation, will not be tolerated;
— The resources the company has dedicated to compliance;
— The quality and experience of the personnel involved in compliance, such that they can understand and identify the transactions and activities that pose a potential risk;
— The authority and independence of the compliance function and the availability of compliance expertise to the board;
— The effectiveness of the company’s compliance function and the availability of compliance expertise to the board;
— The effectiveness of the company’s risk assessment and the manner in which the company’s compliance program has been tailored based on that risk assessment;
— The compensation and promotion of the personnel involved in compliance, in view of their role, responsibilities, performance, and other appropriate factors;
— The auditing of the compliance program to ensure its effectiveness; and
— The reporting structure of any compliance personnel employed or contracted by the company.”
   – “Appropriate discipline of employees, including those identified by the company as responsible for the misconduct, either through direct participation or failure in oversight, as well as those with supervisory authority over the area in which the criminal conduct occurred;
   – Appropriate retention of business records, and prohibition of the improper destruction or deletion of business records, including implementing appropriate guidance and controls on the use of personal communications and ephemeral messaging platforms that undermine the company’s ability to appropriately retain business records or communications or otherwise comply with the company’s document retention policies or legal obligations; and
   – Any additional steps that demonstrate recognition of the seriousness of the company’s misconduct, acceptance of responsibility for it, and the implementation of measures to reduce the risk of repetition of such misconduct, including messages to identify future risks.”
 
DOJ also will confer with its law enforcement partners to assess whether a company merits full credit for timely and appropriate remediation. The guidance notes that NSD “will also coordinate with the appropriate regulatory agency (e.g., BIS) in assessing a corporation’s remediation efforts and compliance program.”
 
Willfulness.
As noted above, the new DOJ policy guidance applies only to VSDs concerning potentially willful (and therefore criminal) violations of export control and sanctions law. Willfulness is an element of the offense that the government must prove beyond a reasonable doubt in any criminal prosecution of export control or sanctions violations. The new policy guidance reiterates that NSD uses the definition of willfulness set forth by the Supreme Court in Bryan v. United States, 524 U.S. 184 (1998), which provides that an act is willful if it was committed with the knowledge that it is illegal. As later courts of appeal have ruled, however, the government is not required to prove that a defendant was aware of the specific law, rule, or regulation that the defendant’s conduct may have violated.
 
The new DOJ guidance does not elaborate on the degree of belief or certainty regarding a possible criminal violation that a company must possess in order to warrant a VSD. The fact that the guidance expressly concerns the disclosure of only “potentially willful” violations, however, indicates that companies need not have reached a conclusive determination that a potential violation was willful, and that credible evidence of such a violation (or a reasonable belief) may suffice to come within the scope of the guidance.
 
New Applicability to Financial Institutions.
The new guidance directs that all VSDs concerning potentially willful export control and sanctions violations be sent to CES, which has primary jurisdiction and approval authority within DOJ for the criminal enforcement of export control and sanctions laws. The previous guidance, which by its terms expressly did not apply to financial institutions, directed financial institutions to submit VSDs to the Asset Forfeiture and Money Laundering Section in the Criminal Division (now the Money Laundering and Asset Recovery Section) or the relevant U.S. Attorney’s Office.
 
Implications.
DOJ continues to assign high priority to holding companies accountable for violations of export control and sanctions laws, and to punishing wrongdoing by individual company officials. The original VSD guidance apparently did not result in a significant volume of disclosures, as many companies were wary of informing the government of potential criminal violations without the prospect of more tangible, meaningful, and predictable benefits. Not every company will be able to meet all the requirements to qualify for the maximum benefits available under the new guidance. That such benefits have now been clearly delineated, however, makes the submission of a VSD a more attractive option for companies that have discovered evidence of willful violations. Whether the new policy guidance results in a significantly greater number of more VSDs, however, may depend on the extent to which companies considering a VSD can see public evidence of favorable resolutions in other cases.

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TEEX/IM TRAINING EVENTS & CONFERENCES

TE_111.
ECTI Presents the Paradox of Compliance: ITAR and Anti-Discrimination Concerns, 11 Feb Webinar 
(Source:
Danielle Hatch
)
 
* What: The Paradox of Compliance: ITAR and Anti-Discrimination Concerns 
* When: 11 Feb 2020; 1:00 p.m. (EST)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Olga Torres

* Register
here
 
or 
Danielle Hatch
, 540-433-3977

* * * * * * * * * * * * * * * * * * * *

TE_a212. Full Circle Compliance Presents: Export Compliance Training Seminars
(Source: Full Circle Compliance)

U.S. Export Controls: ITAR

Tuesday, 7 April 2020, Amsterdam
More Info

U.S. Export Controls: EAR

Wednesday, 8 April 2020, Amsterdam
More Info

The ABC of Foreign Military Sales (FMS)

Tuesday, 9 April 2020, Amsterdam


(Sources: Editor and Event Sponsors)

Published every Friday or last publication day of the week, o
ur overview of Approaching Events is organized to list c
ontinuously available training, training events, s
eminars & conferences, and 
webinars. 
   

 
* Date: Location; “Event Title”; <Weblink>”; EVENT SPONSOR
# = New or updated listing  

 
Continuously Available Training
 
* E-Seminars:US Export Controls” / “Defense Trade Controls“; Export Compliance Training Institute; danielle@learnexportcompliance.com 

* Webinar: ”
Company-Wide US Export Controls Awareness Program“; Export Compliance Training Institute;
danielle@learnexportcompliance.com 

* E-Seminars: “ITAR/EAR Awareness“; Export Compliance Solutions;
spalmer@exportcompliancesolutions.com

* Webinar Series: “Complying with US Export Controls“; Commerce/BIS

* E-Seminars: “Webinars On-Demand Library“; Sandler, Travis & Rosenberg, P.A.
* Online: “International Trade Webinars“; Global Training Center

* Online: “ITAR – Requirements for Government Contractors“; Williams Mullins, LLP

*
 
Online: “On-Demand Webinars“; “General Training“; Center for Development of Security Excellence; Defense Security Service (DSS)
* Online: “ACE Reports Training and User Guide“; DHS/CBP

* Online: ”
Increase Your International Sales – Webinar Archive“; U.S. Commercial Service

* Web Form: “Compliance Snapshot Assessment“; Commonwealth Trading Partners (CTP)
* Online: “
Customs Broker Exam Prep Course
“; The Exam Center
 
 
Seminars and Conferences

 

* Jan 14: Leeds, UK; “
Export Documentation
“; Chamber International 
* Jan 20-23; San Diego, CA; “ITAR Controls / EAR & OFAC Export Controls Seminar Series“, ECTI; 540-433-3977   

* Jan 22; Arlington, VA; “
Volunteer and Speaker of the Year Business Luncheon
;” Society for International Affairs

* Jan 22-23: New York, NY; “AML & OFAC for the Insurance Industry“; American Conference Institute  

* Jan 23: Orlando, FL; “Customs/Import Boot Camp“; Partnering for Compliance

* Jan 28: Leeds, UK; “
Export Documentation & Import Procedures“; Chamber International

* Jan 29-30 Tyson Corner, VA;

ITAR for the Empowered Official
;
FD Associates

*
 
Jan 30-31: Houston, TX; “
14th Forum on the Foreign Corrupt Practices Act
“; 
American Conference Institute

* Feb 5: Las Vegas, NV; “Export Procedures Seminar“; International Business Training

* Feb 5-6; Munich, Germany; “Export Compliance in Europe Conference“; NielsonSmith

* Feb 11: Leeds, UK; “Incoterms 2020“; Chamber International

* Feb 11 Madison, WI;


Trade Compliance Hits the Big Time

;
Madison Int’l Trade Assoc. (MITA)

* Feb 11-12: Tampa, FL; “ITAR/EAR Boot Camp: Achieving Compliance“; ECS
 


* Feb 12: Anaheim, CA; “Exporting Procedures Seminar“; International Business Training

* Feb 12: Plymouth, UK; “
Intermediate Seminar: Strategic Export Controls“; UK DIT

#
* Feb 12 – 14: Houston, TX; “5th Annual Advanced Topics in Customs Compliance Conference 2020“; Braumiller Law Group

* Feb 13: Adelaide, Austrlia; “ITAR/EAR/AU Export Control Awareness“; Goal Professional Services Pty Ltd

* Feb 13: Plymouth, UK; “
Foundation Workshop: Strategic Export Controls“; UK DIT
* Feb 13: Plymouth, UK; “
Licenses Workshop: Strategic Export Controls“; UK DIT

* Feb 17-20; Huntsville, AL; “
ITAR Controls / EAR & OFAC Export Controls Seminar Series
, ECTI; 540-433-3977

* Feb 20: Charlotte, NC; “Exporting Procedures Seminar“; International Business Training

* Feb 20-21; Berlin, Germany; “
14. Exportkontrolltag
“; ZAR

* Feb 24-26; Las Vegas, NV; “Winter Back to Basics Conference“; Society for International Affairs

* Feb 25-26: St. Antonio, TX; “
Complying with U.S. Export Controls
“; Commerce/BIS

* Feb 26: Washington D.C.; “Women Leaders in Defense and Aerospace Law & Compliance; ACI

* Feb 27: Cincinnati, OH; “Exporting Procedures Seminar“; International Business Training

* Mar 2: Alexandria, VA; “ITAR Defense Trade Controls / EAR Export Controls“; WITA

* Mar 2-5; Washington D.C.; “
ITAR Controls / EAR & OFAC Export Controls Seminar Series
“, ECTI; 540-433-3977

* Mar 3-5; Vienna, Austria; “Lehrgang Exportkontrolle & Export Compliance“; OPWZ

* Mar 4: Birmingham, UK; “
Intermediate Seminar: Strategic Export Controls
“; UK DIT
* Mar 5: Birmingham, UK; “
Foundation Workshop: Strategic Export Controls
“; UK DIT
* Mar 5: Birmingham, UK; “
 
Licenses Workshop: Strategic Export Controls
“; UK DIT

* Mar 10; Leeds, UK; “
Understanding Exporting & Incoterms
“; Chamber International

* Mar 10-12:  Orlando, FL; “‘Partnering for Compliance’ Export/Import Control Training and Education Program“; Partnering for Compliance

* Mar 17-18: Orlando, FL; “Complying with U.S. Export Controls“; Commerce/BIS
* Mar 19: Orlando, FL; “How to Build an Export Compliance Program“; Commerce/BIS

* Mar 24: “Export Documentation“; Chamber International

#
* Mar 24; Kansas, City, MO; “FTZ 101“; Miller & Company P.C.

#
* Mar 25; Kansas City, MO; “FTZ 201“; Miller & Company P.C.

* Mar 25-26: Park City, UT; “Managing ITAR/EAR Complexities Seminar“; ECS

* Mar 25-26:
Tysons Corner, VA;”ITAR Fundamentals“; FD Associates

* Mar 26:
San Francisco; “12th Advanced Forum on International Technology Transfers“; ACI
* Mar 27: Philadelphia, PA; “Exporting Procedures Seminar“; International Business Trainin 


* Mar 30-Apr 2: Orlando, FL; “ITAR Controls (Mar 30-31) / EAR & OFAC Export Controls (Apr 1-2)“; ECTI; 540-433-397 

* Apr 7-8: Washington D.C.; “6th National Conference on CFIUS & Team Telecom; ACI

* Apr 15-16: Harrisburg, PA; “Complying with U.S. Export Controls“; Commerce/BIS
* Apr 21-22: New Orleans, LA; “Mastering ITAR/EAR Challenges Seminar“; ECS
* Apr 22: London, UK; “
Intermediate Seminar: Strategic Export Controls
“; UK DIT
* Apr 23: London, UK; “
Foundation Workshop: Strategic Export Controls
“; UK DIT
* Apr 23: London, UK; “
 
Licenses Workshop: Strategic Export Controls
“; UK DIT
 

* Apr 22-23: Washington D.C.; “Economic Sanctions Enforcement and Compliance“;
American Conference Institute

* Apr 23: Atlanta, GA; “Exporting Procedures Seminar“; International Business Training
* Apr 23: Charlotte, NC; “Exporting Procedures Seminar“; International Business Training
* Apr 23: Cleveland, OH; “Exporting Procedures Seminar“; International Business Training
* Apr 23: Minneapolis, MN; “Exporting Procedures Seminar“; International Business Training

* Apr 28-29: Orange County, CA; “Complying with U.S. Export Controls“; Commerce/BIS 
* Apr 29-30: Washington DC; “
Economic Sanctions Enforcement and Compliance
“; American Conference Institute

* May 13: St. Louis, MO; “Exporting Procedures Seminar“; International Business Training
* May 14: Milwaukee, WI; “Exporting Procedures Seminar“; International Business Training

* May 19-20: Charleston, SC; “Complying with U.S. Export Controls“; Commerce/BIS

* May 20:
Tysons Corner, VA”EAR Basics“; FD Associates 

* May 20-21: Berlin, Germany; “Berlin Forum on Global Economic Sanctions“; C5

* May 21: Louisville, KY; “Exporting Procedures Seminar“; International Business Training

* May 27-28: Hong Kong, China; “Hong Kong Summit on Economic Sanctions Enforcement and Compliance“;
American Conference Institute

* Jun 4-5: Seattle, WA;
Complying with U.S. Export Controls“; Commerce/BIS

* Jun 9-10: Shanghai, China; “China Forum for Legal and Compliance Officers“; American Conference Institute

* Jun 11: San Diego, CA; “Exporting Procedures Seminar“; International Business Training

* Jun 17: London, UK; “Trade & Customs Compliance Group“; TechUK

* Jun 22-25: San Diego, CA; “ITAR Controls (June 22-23) / EAR & OFAC Export Controls (June 24-25)“; ECTI; 540-433-3977

* Jun 25: Boston, MA; “Exporting Procedures Seminar“; International Business Training

* Jul 21-22: Washington DC; “FCPA High Risks Markets“; American Conference Institute

* Aug 4-5: Orlando, FL;
Complying with U.S. Export Controls“; Commerce/BIS

* Aug 19-20:
Tysons Corner, VA;
ITAR FUNdamentals
“; FD Associates

* Sep 14-15: Los Angeles, CA; “Complying with U.S. Export Controls“; Commerce/BIS

* Sep 23-24: Los Angeles, CA;
Complying with U.S. Export Controls“; Commerce/BIS

* Oct 21-23: Tysons Corner, VA;
U.S. Export Controls From A Foreign Perspective
“; FD Associates
*November 11-12: Tysons Corner, VA; “
ITAR for the Empowered Official
“; FD Associates

 

Webinars  
 

* Jan 14: Webinar: “Commodity Jurisdiction“; NCBFAA

* Jan 22: Webinar: “Export Jurisdiction and Classification Determination Basics“; Sandler, Travis & Rosenberg

#
* Jan 23: Webinar: Challenges in Compliance and Corporate Governance“, Gibson Dunn

* Jan 23: Webinar; “
Exporting Procedures
“; Global Training Center


* Jan 24: Webinar; “
Incoterms 
“; Global Training Center
* Jan 25: Webinar: “
Roadmap to a Successful Voluntary Self-Disclosure
“; U.S. Census
* Jan 27: Webinar; “
Tariff Classification
“; Global Training Center
* Jan 28: Webinar; “
NAFTA Rules of Origin
“; Global Training Center
* Jan 29: Webinar; “
Importing Procedures
“; Global Training Center
* Jan 30: Webinar; “
Importing 201
“; Global Training Center
* Jan 31: Webinar; “
International Logistics
“; Global Training Center

Feb 18: Webinar: “Drop Shipments & Routed Transactions“; NCBFAA

* Feb 28: Webinar; “
CTPAT
 
“; Global Training Center

* Mar 10: Webinar: “Cultural Sensitivity Program” NCBFAA

* Mar 19: Webinar; “
Export to Mexico
“; Global Training Center
* Mar 20: Webinar; “
Export to Canada
“; Global Training Center
* Mar 23: Webinar; “
Tariff Classification
“; Global Training Center
* Mar 24: Webinar; “
NAFTA Rules of Origin
“; Global Training Center
* Mar 25: Webinar; “
International Logistics
“; Global Training Center
* Mar 26: Webinar; “
Letters of Credit
“; Global Training Center
* Apr 06: Webinar; “
Importing Procedures
“; Global Training Center
* Apr 07: Webinar; “
Importing 201
“; Global Training Center
* Apr 14: Webinar: “
ACE Export Reports for Compliance
“; NCBFAA
* May 07: Webinar; “
CTPAT
“; Global Training Center
* May 11: Webinar; “
International Logistics
“; Global Training Center
* May 12: Webinar; “
Letters of Credit
“; Global Training Center
* May 19: Webinar; “
Exporting Procedures
“; Global Training Center
* May 20: Webinar; “
Incoterms
“; Global Training Center
* May 21: Webinar; “
Export to Mexico
“; Global Training Center
* May 22: Webinar; “
Export to Canada
“; Global Training Center
* Jun 16: Webinar; “
Tariff Classification
“; Global Training Center
* Jun 17: Webinar; “
NAFTA Rules of Origin
“; Global Training Center

* * * * * * * * * * * * * * * * * * * *

ENEDITOR’S NOTES

EN_a114. Bartlett’s Unfamiliar Quotations

(Source: Editor)



Lord Acton
(
John Emerich Edward Dalberg-Acton, 1st Baron Acton, 10 Jan 1834 – 19 June 1902; was an 
English
 
Catholic
 historian, politician, and writer.)
  – “If some great catastrophe is not announced every morning, we feel a certain void. Nothing in the paper today, we sigh.”
 

William James
(11 
Jan 1842 – 26 Aug 1910; was an American philosopher and 
psychologist
 who was also trained as a 
physician
. The first educator to offer a psychology course in the United States, and is often referred to as the “Father of American psychology.”)
  – “Success or failure depends more upon attitude than upon capacity.  Successful men act as though they have accomplished or are enjoying something. Soon it becomes a reality. Act, look, feel successful, conduct yourself accordingly, and you will be amazed at the positive results.”
 
Friday Funnies:
A man walks into a bar and notices two pieces of beef nailed to the high ceiling.  He asks the bartender about them.  The bartender says, “It’s a contest. If you can climb up on a stack of four chairs and get those pieces of meat down, you’ll get free drinks all night.  But if you fall, you have to buy a round for everybody in the bar.  Like to try it?”  The man has a long look at the ceiling before saying, “No thanks. Not me. The steaks are too high.”

* * * * * * * * * * * * * * * * * * * *

EN_a215. 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 are listed below.
 
Agency 
Regulations 
Latest Update 
DHS CUSTOMS REGULATIONS: 19 CFR, Ch. 1, Pts. 0-199.  5 Apr 2019:  5 Apr 2019: 84 FR 13499-13513: Civil Monetary Penalty Adjustments for Inflation.
DOC EXPORT ADMINISTRATION REGULATIONS (EAR): 15 CFR Subtit. B, Ch. VII, Pts. 730-774. 

6 Jan 2020:
85 FR 459-462
: Addition of Software Specially Designed to Automate the Analysis of Geospatial Imagery to the Export Control Classification Number 0Y521 Series

 

DOC FOREIGN TRADE REGULATIONS (FTR): 15 CFR Part 30.   Last Amendment: 24 Apr 2018: 83 FR 17749-17751: Foreign Trade Regulations (FTR): Clarification on the Collection and Confidentiality of Kimberley Process Certificates 
DOD NATIONAL INDUSTRIAL SECURITY PROGRAM OPERATING MANUAL (NISPOM): DoD 5220.22-M. Implemented by Dep’t of Defense.  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.)  
DOE ASSISTANCE TO FOREIGN ATOMIC ENERGY ACTIVITIES

: 10 CFR Part 810.

 

23 Feb 2015: 80 FR 9359

, comprehensive updating of regulations, updates the activities and technologies subject to specific authorization and DOE reporting requirements.  

 

DOE EXPORT AND IMPORT OF NUCLEAR EQUIPMENT AND MATERIAL; 10 CFR Part 110.  20 Nov 2018, 10 CFR 110.6, Re-transfers. 
DOJ ATF ARMS IMPORT REGULATIONS: 27 CFR Part 447-Importation of Arms, Ammunition, and Implements of War. 

14 Mar 2019:
 
84 FR 9239-9240
: Bump-Stock-Type Devices.

DOS INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (ITAR): 22 C.F.R. Ch. I, Subch. M, Pts. 120-130.  26 Dec 2019: 84 Fed Reg 70887, Creation of Definition of Activities That Are Not Exports, Reexports, Retransfers, or Temporary Imports, etc. … 
DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders.
22 Nov 2019:

84 FR 64415-64417: Venezuela Sanctions Regulations

USITC HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES (HTS, HTSA or HTSUSA),

1 Jan 2019: 19 USC 1202 Annex. 

 

  – HTS codes for AES are available here.
  – HTS codes that are not valid for AES are available here.
 

  

* * * * * * * * * * * * * * * * * * * *
EN_a3

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