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20-0508 Friday “Daily Bugle”

20-0508 Friday “Daily Bugle”

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Friday, 8 May 2020

  1. USTR: “Notice of Products Exclusions” 
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings)
  3. DHS/CBP: “FDA Document Submission During COVID-19 Pandemic”
  4. State/DDTC: (No new postings)
  1. ST&R Trade Report: “Dates and Deadlines: Classification, COVID-19, Customs Investigations, Fee Increase”
  2. WorldECR: “US Congress Overwhelmingly Supports Extension of UN Arms Embargo on Iran”
  1. ECS: “Commerce Targets Chinese Military with Expanded Export Restrictions”
  2. Steptoe: “EU Prolongs and Adjusts Export Authorization Scheme for PPE”
  3. Kelley Drye: “U.S. State Department Announces Temporary ITAR Provisions In Response to COVID-19”
  1. ECTI Presents United States Export Control (ITAR/EAR/OFAC) Seminar in Singapore: 14-17 September
  2. FCC Academy Presents Webinar: “An Introduction to EU/Dutch Dual-use and Military Export Controls”; 12 May
  3. Friday List of Approaching Events: 160 Events Posted This Week, Including 17 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 
  4. Submit Your Job Opening and View All Job Openings 
  5. Submit Your Event and View All Approaching Events 

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EXIM ITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a11. USTR: “Notice of Products Exclusions”

(Source:
Federal Register, 8 May 2020) [Excerpts]
 
85 FR 27489: Notice of products exclusions.
*
AGENCY:
Office of the United States Trade Representative.
*
ACTION:
Notice of product exclusions.
*
SUMMARY:
In September 2018, the U.S. Trade Representative imposed additional duties on goods of China with an annual trade value of approximately $200 billion as part of the action in the Section 301 investigation of China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation. The U.S. Trade Representative initiated a product exclusion process in June 2019, and interested persons have submitted requests for the exclusion of specific products. This notice announces the U.S. Trade Representative’s determination to grant certain exclusion requests, as specified in the Annex to this notice, and corrects technical errors in previously announced exclusions.
*
DATES:
The product exclusions announced in this notice will apply as of September 24, 2018, the effective date of the $200 billion action, and extend to August 7, 2020. The amendments announced in this notice are retroactive to the date that the original exclusions were published.
*
FOR FURTHER INFORMATION CONTACT:
For general questions about this notice, contact Assistant General Counsels Philip Butler or Megan Grimball, or Director of Industrial Goods Justin Hoffmann at (202) 395-5725. For specific questions on customs classification or implementation of the product exclusions identified in the Annex to this notice, contact traderemedy@cbp.dhs.gov.

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

OGS OTHER GOVERNMENT SOURCES

* Justice/ATF: NOTICES; Agency Information Collection Activities; Proposals, Submissions, and Approvals: Annual Firearms Manufacturing and Exportation Report [Pub. Date: 11 May 2020] [PDF]
 
* Justice/ATF: NOTICES; Agency Information Collection Activities; Proposals, Submissions, and Approvals: Inventories; Licensed Explosives Importers, Manufacturers, Dealers, and Permittees [Pub. Date: 11 May 2020] [PDF]
 
* Treasury/OFAC: NOTICES; Blocking or Unblocking of Persons and Properties [Pub. Date: 11 May 2020] [PDF]

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

(Source: Commerce/BIS)

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

OGS_a3
4. DHS/CBP: “FDA Document Submission During COVID-19 Pandemic”

(Source:
DHS/CBP)
, 8 May 2020)
 
The Food and Drug Administration (FDA) continues critical work to protect public health during the COVID-19 pandemic. This work includes review of FDA regulated products offered for importation. If a request for documents is received from FDA, filers and/or importers are strongly encouraged to submit product labeling along with regularly submitted entry documents (commercial invoice, packing list, way bill, etc.). Submission of labeling will help expedite the admissibility process during this pandemic.
Labeling along with entry documents should be submitted electronically via the FDA Import Trade Auxiliary Communication System (ITACS). ITACS functionality can be accessed at 
https://itacs.fda.gov. This includes checking statuses, providing requested documentation and location of goods electronically, and checking the estimated laboratory analysis completion dates for lines which have been sampled.
Additional information on ITACS, including questions and answers, can be found on FDA’s ITACS for Industry webpage: 
https://www.fda.gov/industry/import-systems/itacs . For further questions regarding ITACS, please contact 
itacssupport@fda.hhs.gov.

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

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

COM NEWS

NWS_a16. ST&R Trade Report: “Dates and Deadlines: Classification, COVID-19, Customs Investigations, Fee Increase”

(Source:
Sandler, Travis & Rosenberg Trade Report
, 8 May 2020) [Excerpts]


Following are highlights of regulatory effective dates and deadlines, federal agency meetings, and other trade-related events coming up in the next week.
 
May 11 – deadline for comments on ATF information collection on
imported firearms 
May 11 – deadline for comments on CBP information collections on
dumping, NAFTA, general declaration 
May 12 – ITC hearing on
illegal seafood imports 
May 13 – ST&R webinar:
COVID-19 Impact on Trade 
May 14 – deadline for comments to USDA on
imports of melon, tarragon, rosemary 
May 14 – ST&R webinar:
Preparing for a Customs Investigation 
May 15 – deadline for comments on USDA information collection on
import regulation exemptions 
May 15 – deadline for comments to DEA on fee increase for
import/export of controlled substances and list I chemicals 
May 15 – deadline for comments on proposed
classification change for tool holders 
May 15 – deadline for comments to CBP on
classification change for instant coffee mixes 

NWS_a27. WorldECR: “US Congress Overwhelmingly Supports Extension of UN Arms Embargo on Iran”

(Source: WorldECR, 7 May 2020) [Excerpts]
 
An overwhelming majority of US lawmakers from both sides of the political divide have put their signatures to a letter urging Secretary of State Mike Pompeo to do more to push for the renewal of a UN arms embargo against Iran that is currently set to expire in October.
 
‘We write to urge increased diplomatic action by the United States to renew the expiring United Nations arms embargo against Iran and United Nations travel restrictions on those Iranian individuals involved with dangerous proliferation activities,’ the lawmakers from the Republican and Democratic parties wrote.
 
‘America must continue its longstanding, bipartisan leadership in order to limit Iran’s destabilizing activities throughout the world. We look forward to working with you to reauthorize these expiring U.N. restrictions, which are essential to protecting our national security and the American people.’
 
The letter was organized by House Foreign Affairs Committee Chairman Eliot Engel (D-N.Y.) and committee ranking member Rep. Michael McCaul (R-Texas) and has been signed by 384 of the 435 members of the House of Representatives.
 
A UN arms embargo on Iran is set to expire in October, under a 2015 multilateral nuclear deal signed between Iran and the five permanent members of the Security Council plus Germany. …
 
Media reports indicate that a renewal of the arms embargo is likely to be opposed by Russia and China, which have veto power in the Security Council and are said to be eager to resume arms sales to Tehran. …
 
‘We will work with the UN Security Council to extend that prohibition on those arms sales and then in the event we can’t get anyone else to act, the United States is evaluating every possibility about how we might do that,’ he said.
 
Iran has called US efforts to extend the embargo ‘illegitimate’ and warned it would react to them with ‘proportionate’ measures.

COM COMMENTARY

 
On April 28, 2020, the Department of Commerce, Bureau of Industry and Security (BIS), published three notices revising the Export Administration Regulations (EAR).  These changes are intended to increase restrictions on exports to China, but will affect transactions involving other countries as well:
  • 85 FR 23459 – Expansion of Export, Reexport, and Transfer (in-Country) Controls for Military End Use or Military End Users in the People’s Republic of China, Russia, or Venezuela
  • 85 FR 23470 – Elimination of License Exception Civil End Users (CIV)
  • 85 FR 23496 – Modification of License Exception Additional Permissive Reexports (APR)
This rule comes after much delay as these changes have been 
anticipated since 2018 and we now have two final rules and one proposed rule from BIS.
 
Chinese Military End Use
Effective June 29, 2020 (
85 FR 23459), EAR Part 744 will be amended to further restrict exports and reexports to China, as well as to Russia and Venezuela, when destined for a military end user or end use.
  • 744.21 previously restricted exports to China for military end use, as well as exports to Russia or Venezuela for military end use or end users. By adding military end users in China, the new rule will apply the same limitations to all three countries. The new rule also broadens the definition of military end use to include additional items.
Items subject to the military end use or end user restrictions are identified by Export Control Classification Number (ECCN) in Supplement No. 2 to Part 744.  The following ECCNs will be added to the supplement or their controls expanded: 2A290, 2A291, 2B999, 2D290, 3A991, 3A992, 3A999, 3B991, 3B992, 3C992, 3D991, 5B991, 5A992, 5D992, 6A991, 6A996, 8A992, 9A991 and 9B990.
 
Items restricted under the revised §744.21 will require a BIS license and be subject to a policy of denial.  Previously, such applications were reviewed on a case-by-case basis, considering whether an export would make a material contribution to military capabilities and result in advancing military activities contrary to U.S. national security interests.
 
The rule also establishes a Regional Stability (RS) license requirement for any 9×515 or 600 series paragraph .y items destined for China, Russia, or Venezuela.  There is an exception for the export or reexport of items to Russia for the International Space Station (ISS).
 
Finally, the rule amends the EAR to require Electronic Export Information (EEI) filings for any items destined China, Russia, or Venezuela regardless of value, unless shipped under License Exception GOV.”
 
Between the expanded definitions and “China’s widespread civil-military integration,” these revisions will require increased due diligence when evaluating end users in China. For additional detail, refer to the 
Federal Register Notice.
 
Removal of License Exception CIV
Also effective June 29, 2020 (
85 FR 23470), the §740.5 License Exception Civil End Users (CIV) will be removed from the EAR.
License Exception CIV currently allows exports and reexports of specifically identified CCL items controlled for National Security reasons to twenty three countries of national security concern when “destined to civil end-users for civil end-uses.”
 
License Exception CIV is not generally available-the license exception must be positively identified in the ECCN entry for the item in question.  License Exception CIV is generally a counterpart to the Shipments to Country Group B Countries (GBS) or Technology and Software Under Restriction (TSR) exceptions, which allow similar exports to the EAR’s Country Group B.
In removing License Exception CIV, BIS is primarily concerned by “the increasing integration of civilian and military technology development in these countries of concern.”  The removal of the license exception means that BIS licenses will be required for such transactions for all D:1 countries.
The rule also makes conforming changes to the EAR, largely removing the “CIV: Yes” or “CIV: No” indications from ECCNs.
 
The Commerce Country Groups are listed in 
Supplement No. 1 to Part 740.
For additional detail, refer to the 
Federal Register Notice.
 
Modification of License Exception APR
Finally, BIS issued a proposed rule (
85 FR 23496) to modify the §740.16 License Exception Additional Permissive Reexports (APR).
License Exception APR currently allows the reexport of some controlled items from Country Group A:1 or Hong Kong, given certain conditions including an export authorization from the reexporting country.  Because of concerns about these countries’ licensing review standards, APR may allow the reexports that would have been denied for export directly from the U.S.
 
The BIS proposal removes Country Group D:1 as eligible destinations under License Exception APR so that the U.S. government approval would be required for reexports to these countries of national security concern.
 
Comments may be submitted through June 29, 2020.  In particular, BIS requests comments on how the proposal would impact current use of License Exception APR and the volume of transactions affected.  Review the 
Federal Register Notice for the full proposed rule and how to submit comments. 

COM_a29. Kelley Drye: “U.S. State Department Announces Temporary ITAR Provisions In Response to COVID-19”

(Source:
Kelley Drye, 7 May 2020)
 
* Principal Author: Eric McClafferty, 1-212-808-7759, Kelley Drye & Warren LLP 
 
The Department of State’s Office of Defense Trade Controls Policy
 
announced that they are temporarily suspending, modifying, and excepting certain International Traffic in Arms Regulations (ITAR) requirements in an
effort to mitigate the impact of the COVID-19 pandemic.  The temporary changes are as follows:

  • As of February 29, 2020, ITAR registrations and fees with an expiration dates from February 202″ through June 30, 2020 are extended for two months from the original expiration date.
  • As of March 13, 2020, ITAR licenses and agreements expiring between March 13 and May 31, 2020 will be extended for six months from the original expiration date, so long as there are no changes to the name/address, scope, or value of the authorization.
  • As of March 13, 2020, there is a temporary suspension, modification, and exception to the requirement that a regular employee, for purposes of ITAR §120.39(a)(2), work at the company’s facilities, to allow the individual to work at a remote work location. Additionally, regular employees of licensed entities, who are working remotely in a country not currently authorized by a technical assistance agreement (TAA), manufacturing license agreement or exemption, can access, send, or receive technical data that is authorized for export, reexport or retransfer to their employer via a TAA.
For both situations, the individual employee must not be located in Russia or a country listed in ITAR §
126.1. These two provisions end on July 31, 2020, unless extended in writing.

COM_a310. Steptoe: “EU Prolongs and Adjusts Export Authorization Scheme for PPE”

 
* Principal Author: Guy Soussan, 32-2-626-0535, Steptoe & Johnson LLP
 
Following the COVID-19 outbreak, the EU introduced measures requiring that exports to non-EU countries of some personal protective equipment (PPE) be subject to authorization. The European Commission now announced the prolongation of these measures until 25 May 2020 and issued a 
modified Implementing Regulation
. The adjustments result from a careful evaluation of needs signaled by EU Member States and include the following:
  • The new rules reduce the list of products that require export authorizations to masks, spectacles and protective garments. They also clarify that the authorization is limited to Union goods, whether or not originating in the EU, and is not required for non-Union goods as defined in article 5(23) and (24) of Regulation (EU) No 952/2013 laying down the Union Customs Code.
     
  • The modified Implementing Regulation extends the geographical exception to six Western Balkans countries (Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia). The exemption previously only targeted the members of the European Free Trade Association (Iceland, Liechtenstein, Norway and Switzerland) as well as certain overseas countries and territories, the Faeroe Islands, Andorra, San Marino, and the Vatican City. The decision to expand the geographical exception responds to demands voiced by the candidate countries for EU Membership in the Western Balkans.
     
  • EU Member States are further required to process applications for export authorizations in an expedite manner and within maximum 2 working days. They shall immediately notify the Commission the authorizations granted and those refused.
The European Commission released an 
FAQ document
 
accompanying the revised text. It provides guidance on the scope of the measures, the authorization procedure followed by the competent authorities, the approach foreseen regarding humanitarian supplies, customs procedures, and the role of the Clearing House created by the Commission to facilitate the availability of goods within the EU Internal Market.
 
Depending on the evolution of the health situation and the supply of PPE in the EU, it is possible that this export authorization scheme will be extended after 25 May. Following uncoordinated decisions by EU Member States at the beginning of the COVID-19 outbreak, the Commission is now expanding its coordinating role in the crisis response, with the aim of preserving the homogeneity of the EU Internal Market. However, the restrictions on trade to non-EU countries not benefiting from an exception persist and will likely continue to give rise to tensions.

TE EX/IM TRAINING EVENTS & CONFERENCES

(Source:
ECTI
)
 
* What: United States Export Controls (ITAR/EAR/OFAC) Seminar Series in Singapore (for Asia-Pacific and other non-US based companies)
* When: ITAR Seminar: 14-15 September; EAR/OFAC Seminar: 16-17
September
* Where: Singapore, Orchard Hotel Singapore, 442 Orchard Road, Singapore
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker Panel: Scott Gearity, and Timothy O’Toole, Esq.
* Register
here
, or contact 
Jessica Lemon
, 1-540-433-3977.

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

TE_a2
12. FCC Academy Presents Webinar: “An Introduction to EU/Dutch Dual-use and Military Export Controls”; 12 May

 
* What: Introduction to EU / Dutch Dual-Use and Military Export Controls
* When: 12 May 2020
* Where:  Online
* Sponsor: FCC Academy 
* Presenter: Marco F.N. Crombach MSc (Director)
* Register: 

here
, and email
 events@fullcirclecompliance.eu

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

(Sources: Event sponsors)  
 

Submit your event in the Submission section at the end of this newsletter.  
 
[Editor’s note:  This Daily Bugle Event List has grown so large that we have run out of space to display it!  This week we begin a new practice of displaying only the new events in the Daily Bugle, while maintaining a 
LINK HERE to the full list.] 
 

On-Line:
 
* 12 May:
Technology and Strategic Export Controls – Do I need an export licence?
; Department for International Trade
* 12 May:
Complying with the ITAR;
ITA
* 13 May: Is the Platform You’re Using a Potential Threat to Protecting Your Trade Secrets?
; Crowell & Moring
* 14 May:
OFAC Overview
; ITA
* 19 May: Managing an AML Program in the Time of COVID-19: 2020 AML & Sanctions Risk Considerations for Digital Assets Companies
; Crowell & Moring
* 21 May:
USMCA Preparedness
; Torres Law, PLLC & CSCMP
 
On Location:
 
* 9 Jun:
ACE Exports Compliance Seminar
; U.S. Commercial Service Philadelphia
* 17 Jun: 36th Annual Joint Practice Seminar
; Crowell & Moring
* 27 – 29 Jul: National Harbor, MD;
2020 SUMMER BACK TO BASICS CONFERENCE
; SIA 
* 26 – 27 Oct: Arlington, VA;
2020 FALL ADVANCED CONFERENCE
; SIA

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

EN EDITOR’S NOTES

EN_a114. Bartlett’s Unfamiliar Quotations

(Source: Editor)
 

* Edward Gibbon (8 May 1737 – 16 Jan 1794; was an English historian, writer and Member of Parliament. His most important work, The History of the Decline and Fall of the Roman Empire, was published in six volumes between 1776 and 1788 and is known for the quality and irony of its prose, its use of primary sources, and its polemical criticism of organized religion.)
  – “The various modes of worship which prevailed in the Roman world were all considered by the people as equally true; by the philosopher as equally false; and by the magistrate as equally useful.” 
  – “Beauty is an outward gift which is seldom despised, except by those to whom it has been refused.”
 
Friday funnies:
* Two hunters are out in the woods when one of them collapses.  He doesn’t seem to be breathing, his eyes are glazed.  The other hunter whips out his phone and calls emergency services.  He gasps, “I think my friend is dead!  He’s not breathing!  What can I do?”.  The operator says, “Calm down, sir. I can help, but first, let’s make sure he’s dead.”  There is a silence, then a shot is heard.  Back on the phone, the guy says “OK, now what?”  

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

 

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 2019:84 FR 13499: Civil Monetary Penalty Adjustments for Inflation.

DOC EXPORT ADMINISTRATION REGULATIONS (EAR): 15 CFR Subtit. B, Ch. VII, Pts. 730-774.

28 Apr 2020:
85 FR 23470
: Elimination of License Exception Civil End Users (CIV).
 

 

DOC FOREIGN TRADE REGULATIONS (FTR): 15 CFR Part 30.   Last Amendment: 24 Apr 2018: 83 FR 17749: 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.

15 Nov 2017, 82 FR 52823: miscellaneous corrections include correcting references, an address and a misspelling.

 

DOJ ATF ARMS IMPORT REGULATIONS: 27 CFR Part 447-Importation of Arms, Ammunition, and Implements of War.

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

DOS INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (ITAR): 22 C.F.R. Ch. I, Subch. M, Pts. 120-130. 
6 May 2020: 85 FR 26847,  Temporarily reducing the registration fee schedule in ITAR 122.3 until April 30, 2021. 

 

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

10 Apr 2020:
85 FR 20158:

North Korea Sanctions Regulations. 

 
 
 
 
USITC HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES (HTS, HTSA or HTSUSA), Revision 8.

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.
 

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