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20-0512 Tuesday “Daily Bugle”

20-0512 Tuesday “Daily Bugle”

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Tuesday, 12 May 2020

(No items of interest today) 

  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings)
  3. GAO: “Export Controls: State and Commerce Should Improve Guidance and Outreach to Address University-Specific Compliance Issues”
  4. State/DDTC Posts New FAQs Regarding ITAR § 126.4
  5. Treasury/OFAC: “Venezuela-related General License 13E Removal, 3H and 9G Issuance, and Amended FAQ” 
  6. Hong Kong TID: “Re-exports of U.S.-origin Electronics, Computers and Telecommunications from Hong Kong”
  1. Breaking Defense: “US Risks Losing 5G Standard Setting Battle to China, Experts Say”
  2. YNA: “S. Korea Renews Call for Japan to Lift Exports Curbs”
  3. WORLDecr: “OFAC Says Amex Violated US Sanctions by Issuing Card to Designated German National”
  1. Arent Fox: “Reference Guide–Worldwide Export Controls on Face Masks and Other Medical PPE”
  2. EU Sanctions: “EU Commission Action Plan Strengthens AML & Terrorist Financing Strategy”
  3. N. Turner: “Sanctions Top-5 for the Week Ending 8 May 2020”
  4. Tuttle Law: “Section 301 China – List 3 & List 4A Exclusions Granted in May Reminders of Deadline for Exclusions Expiring June and August 2020”
  1. ECTI Presents FREE Webinar: How to Mitigate Risk with Export Compliance Technologies in a COVID-19 World: 2 Jun
  2. FCC Academy Presents June Webinars: “U.S. Export Controls: ITAR, EAR, and FMS”
  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

 
[No items of interest today]

 
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OGS OTHER GOVERNMENT SOURCES

* Justice/ATF: NOTICES; Agency Information Collection Activities; Proposals, Submissions, and Approvals: Application for Restoration of Firearms Privileges [Pub. Date: 13 May 2020] (PDF)
 
* USTR: NOTICES; Annual Review of Country Eligibility for Benefits under the African Growth and Opportunity Act [Pub. Date: 13 May 2020] (PDF)
 
* USTR: PRODUCT EXCLUSIONS: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation [Pub. Date: 13 May 2020] (PDF) (PDF) (PDF) 

 
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 Top3. GAO: “Export Controls: State and Commerce Should Improve Guidance and Outreach to Address University-Specific Compliance Issues”
(Source: U.S. Government Accountability Office Report GAO-20-394,
12 May 2020)

Why GAO Did This Study
Over 1.2 million foreign students studied at U.S. universities in 2018. Although foreign students and scholars contribute to U.S. research, there is a risk that they will “export” sensitive knowledge they gain to their home countries. To mitigate this risk, the U.S. government implements export controls. GAO was asked to review agency guidance and universities’ security practices.
This report examines:
   (1) the extent to which State and Commerce have provided guidance and outreach that supports U.S. universities’ understanding of export control regulations;
   (2) challenges U.S. universities face working with other federal agencies, such as DOD; and
   (3) the extent to which universities’ export compliance practices align with State and Commerce guidelines.

GAO reviewed related laws, regulations, and guidance, and interviewed officials from relevant federal agencies and four university associations. GAO also visited nine universities-selected, in part, on the basis of research expenditures and geography-and assessed their compliance practices against agency guidelines.

Key findings include:

 

  (1) University and association officials raised concerns that State and Commerce guidance and outreach does not adequately address export compliance issues that are more common to universities, such as fundamental research. Without additional guidance and outreach that addresses such issues, universities may not have the information they need to adequately comply with these regulations and properly safeguard export-controlled items from unauthorized foreign persons.

 

  (2) Officials from selected universities and university associations identified export control-related challenges in working with other federal agencies. For example, university and association officials stated that DOD officials misunderstand the term fundamental research, which may limit universities’ ability to conduct research for DOD. DOD acknowledged that some officials have inconsistently interpreted the regulations and that it has not yet fully addressed this challenge. 

 

  (3) The report also describes the export compliance policies and practices in place at the nine universities we visited. We found that most universities we visited had robust export compliance practices in place, but we identified some gaps in some universities’ practices in four areas-risk assessments, training, internal audits, and export compliance manuals.GAO reviewed related laws, regulations, and guidance, and interviewed officials from relevant federal agencies and four university associations. GAO also visited nine universities-selected, in part, on the basis of research expenditures and geography-and assessed their compliance practices against agency guidelines.

 

What GAO Recommends

GAO is making four recommendations, including that State and Commerce should improve their export control guidance and outreach, which may help address gaps in university export control compliance practices. GAO also recommends that DOD take steps to ensure its officials consistently interpret export control regulations. State, Commerce, and DOD concurred with the recommendations.

View the
full report at GAO-20-394. For more information, contact Kimberly Gianopoulos at (202) 512-8612 or gianopoulosk@gao.gov.

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(Source:
DDTC Website
, 11 May 2020)
Q:
Other than prohibited countries under § 126.1, what’s the general breadth of ITAR exports under ITAR § 126.4? Are there portions of the USML where ITAR § 126.4 would be unavailable?
   A:
ITAR § 126.4 may be used for the transfer of any defense article or the furnishing of any defense service described on the United States Munitions List (“USML”). The plain text of the provision does not limit the scope of the exemption to certain portions of the USML. However, this section does not authorize any transfer that is otherwise prohibited by any other administrative provisions or by any statute or that is inconsistent with U.S. arms embargoes or United Nations Security Council Resolutions (see ITAR § 126.1).

Q: When utilizing ITAR § 126.4, whose responsibility is it to receive and keep the end-user certification, where applicable? Is this the U.S. Government’s, the exporter’s, somehow decided between the two, or is this process exempt from that requirement?

   A: ITAR § 123.26 provides that “[a]ny person engaging in any export … of a defense article or defense service pursuant to an exemption must maintain records of each such export….” This means the person or entity undertaking the transfer is responsible for all applicable filing, record keeping, and certification requirements. The exporter should, at all times, be able to satisfy the relevant record keeping requirements.

Q: ITAR § 126.4(b) notes that an export can be conducted “on behalf of the U.S. Government” to: (1) the U.S. Government where requested, or (2) other entities pursuant to written direction and where an international agreement is in effect. What separates the exemption under § 126.4(b) from the exemption in § 126.4(a)? When is one applicable over the other?

   A: ITAR § 126.4(b) allows a person or entity other than the U.S. Government to undertake a transfer “on behalf of” a department or agency of the U.S. Government. ITAR § 126.4(a) allows transfers by a department or agency of the U.S. Government. The difference between (a) and (b) lies in the person that is undertaking the transfer.

Q: Can the authorization discussed under § 126.4(b) be verbal?

   A: U.S. Government departments and agencies are responsible for developing their own criteria for what constitutes a “request” as discussed under ITAR § 126.4(b)(1) to conduct a transfer on their behalf. The “written direction” required under ITAR § 126.4(b)(2) must be in writing.

Q: Can I ask DDTC to issue a determination or an Advisory Opinion that will tell me whether my transaction qualifies for the ITAR § 126.4 exemption

   A: No. DDTC does not provide exporters with a determination as to whether or not they qualify for an exemption. DDTC deems that exporters are best positioned to make their own determination with respect to whether their activities comply with available exemptions, including the new exemption contained in ITAR § 126.4(b)(1).

Q: Does ITAR § 126.4(a)(1)(ii) authorize exports by U.S. contractors supporting U.S. Government programs? Assuming that the parameters of ITAR § 126.4(a)(1)(ii) (A)-(D) are complied with, is this all the authorization a contractor needs to export an ITAR-controlled defense articles for a government program?

   A: No.  ITAR § 126.4(a) allows transfers by a department or agency of the U.S. government.  If a department or agency of the U.S. government is undertaking the transfer, they may do so if the recipient is a U.S. government employee (ITAR § 126.4(a)(1)(i)) or a person or entity in a contractual relationship with the U.S. government that satisfies the conditions outlined in ITAR § 126.4(a)(1)(ii)(A)-(D). ITAR § 126.4(b) is the exemption available to non-government persons in a contractual relationship with the U.S. Government who wish to export a defense article.

Q: Can ITAR § 126.4 be used in lieu of obtaining a third party transfer approval from PM/RSAT for articles procured via FMS?

   A: No. As stated in ITAR § 126.4(a)(5), “[a]uthorization under this section is for compliance with the ITAR and does not constitute any other U.S. Government approval that may be required prior to the transfer of a defense article, and does not satisfy other obligations of U.S. law or regulation, or applicable government process, procedure, or practice, including the requirement that any export of an item listed on the MTCR Annex receive the case-by-case review called for in the MTCR Guidelines.”

Q: Can ITAR § 126.4 be utilized to conduct classified transfers?

   A: Yes, ITAR § 126.4 can be used to conduct classified transfers. Persons who intend to transfer classified defense articles and services, including classified technical data, pursuant to ITAR § 126.4 are required to comply with all certification and filing requirements for significant military equipment and exemptions.

Q: Does ITAR § 126.4 cover exchanges of ITAR technical information during conversations or meetings that may lack written approval from the relevant government agency?

   A: Yes. If a transaction involving the transfer of technical data satisfies the provisions of ITAR § 126.4(a) or 126.4(b), then these provisions may serve as the export approval for exchanges of ITAR technical information during conversations or meetings. Note that under ITAR § 126.4(b)(1), transfers of technical information to a department or agency of the U.S. government are approved pursuant to its “request,” as defined by the department or agency requesting the transfer.Further, under ITAR § 126.4(b)(2), transfers of technical information to an entity other than the U.S. government or pursuant to an international agreement or arrangement are approved pursuant to a “written request.” For transfers that are oral, visual or electronic the exporter must also complete a written certification as required by ITAR § 125.6(b) and retain it for a period of five years.

 
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(Source:
Treasury/OFAC, 12 May 2020)
 
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is revoking and archiving on its website Venezuela-related General License (GL) 13E “Authorizing Certain Activities Involving Nynas AB,” and is issuing GL 3H (“Authorizing Transactions Related to, Provision of Financing for, and Other Dealings in Certain Bonds”) and GL 9G (“Authorizing Transactions Related to Dealings in Certain Securities”), in each case to remove references to Nynas AB.  OFAC is also making conforming technical updates to two Frequently Asked Questions to reflect the issuance of GLs 3H and 9G. 
 
N
ynas AB has undertaken a corporate restructuring that has resulted in Nynas AB no longer being blocked pursuant to the Venezuela Sanctions Regulations (31 C.F.R. Part 591).  This corporate restructuring, among other things, severs control by blocked persons and reduces the interest of blocked persons below 50 percent.  U.S. persons do not require authorization from OFAC to engage in transactions or activities with Nynas AB, provided such activities do not involve blocke
d persons or otherwise prohibited activities.
 
Absent authorization from OFAC, all U.S. persons continue to be prohibited from engaging in any dealings with Petróleos de Venezuela, S.A. (PdVSA), or any entity in which PdVSA owns, directly or indirectly, a 50 percent or greater interest.

 
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This circular informs traders of the elimination of U.S. Licence Exception Civil End Users (“Licence Exception CIV”) which will affect the exports, re-exports and transfers of certain U.S.-origin electronics, computers and telecommunications products starting from 29 June 2020.

Details

   On 28 April 2020, the Bureau of Industry and Security (“BIS”) of the U.S. Department of Commerce published a final rule (referred as “the rule” hereafter) announcing the elimination of Licence Exception CIV.  The rule can be found at the following web link.
   With effect from 29 June 2020, US export authorisation, which is usually in the form of an individual validated licence issued by the BIS, will be required for exporting/ re-exporting/transferring items previously covered by Licence Exception CIV to countries/ places in Group D:1.  The items affected include, for example, electronics, computers and telecommunications products under Export Control Classification Numbers (“ECCN”) 3A001.a.3, 3A001.a.7, 3A001.a.11, 4A003.g, 5A001 and their sub-categories.
   There is no change to Hong Kong’s import and export licensing control on strategic commodities as required under the Import and Export Ordinance (Chapter 60 of the Laws of Hong Kong) and the Import and Export (Strategic Commodities) Regulations (Chapter 60G of the Laws of Hong Kong).
   To facilitate Trade and Industry Department (“TID”)’s consideration of strategic commodity licence applications, applicants are often required to provide additional supporting documents which include but not limited to valid export authorisations issued by the products’ originating countries/places. In light of the rule, traders importing/exporting the US-origin products concerned are advised to liaise and check with their U.S. exporters/manufacturers, particularly to obtain the necessary and applicable US export authorisation.
 
  In this connection, strategic commodity licences previously issued by TID featuring “U.S. Licence Exception CIV” under the “Export Authorisation of Foreign Exporting/Product’s Originating Country (Place)” should no longer be used after 29 June 2020.  TID will liaise with the licensees concerned to revise the licences’ validity period and/or cancel the unused licences.

Enquiry
If you have any enquiry concerning this circular, please contact Miss Cas Lam at telephone number 2398 5575 or by email at stc@tid.gov.hk.

 
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COM NEWS

NWS_a17. Breaking Defense: “US Risks Losing 5G Standard Setting Battle to China, Experts Say”
(Source: Breaking Defense, 11 May 2020) [Excerpts]
 
  The United States needs to take a stronger role in setting international standards for 5G networks or risk losing the international market to China and undercutting US national security.
Washington is faltering due to a lack of coherent policy on a wide swathe of foundational issues such as spectrum management for 5G usage, network supply chain security, infrastructure development and data sharing, experts say. 
  Commerce put Huawei on its so-called entity list last May citing national security concerns, 
and in August expanded its list of related entities subject to restricted US sales. Despite 
President Donald Trump’s wild swings on whether to keep or lift the ban, those restrictions still stand.
  “Since Huawei’s designation on the Department’s Entity List in May 2019, U.S. technology leaders have been constrained from full participation in 5G standards-setting bodies because of uncertainty over whether such participation is prohibited by the Commerce Department’s export control regulations. We are deeply concerned about the risks to the U.S. global leadership position in 5G wireless technology as a result of this reduced participation, and the economic and national security implications of any diminished U.S. role in 5G,” the senators wrote. 
  The “current national security concerns of Huawei and ZTE, which are integral to the global supply chain for 5G equipment and software” not only are hindering the ability of US tech firms to play a leading role in international standard setting bodies, she said, but also cramping their ability to cooperate with firms in allied nations – leading to US market isolation.
  “To date, only five other partners have followed the U.S. lead in banning Huawei equipment in their communications infrastructures: Japan, Taiwan, Vietnam, Australia and New Zealand.  Twenty-five other U.S. allies, including France, Germany, Italy, the Netherlands, and the U.K., are moving forward with their deployments with some restrictions,” Turner Lee wrote.
  Key to China’s success in development of 5G networks has been the use of low- and mid-band radio frequency (RF) spectrum, according to experts, that for reasons of domestic regulation the US has been unable to match. …

NWS_a28. YNA: “S. Korea Renews Call for Japan to Lift Exports Curbs”

(Source: Yonhap News Agency, 12 May 2020) [Excerpts]
 
  South Korea on Tuesday renewed its call for Japan to lift trade regulations against its neighbor, stressing that the Asian neighbors should join forces to overcome economic jitters sparked by the new coronavirus pandemic.
  Tokyo initiated a trade war against Seoul in July last year by imposing restrictions on exports of three key industrial materials critical for South Korea’s chip and display industries, namely photoresist, etching gas, and fluorinated polyimide.
  Japan also removed South Korea from its list of trusted partners, claiming that Seoul did not effectively control the trade of sensitive materials that can be diverted for military use.
But Tokyo has never pinpointed how Asia’s No. 4 economy violated related rules.
  “Both countries are currently facing challenging times due to the COVID-19 pandemic. We hope that there would be an achievement soon that can bring hope to companies of both countries,” the Ministry of Trade, Industry, and Energy said in a statement, urging Japan to give a response by the end of this month. 
  Since July, the two countries have made only a little progress in narrowing their differences.
South Korea earlier took Tokyo off its list of trusted partners and sought mediation at the World Trade Organization (WTO). It later dropped the WTO lawsuit in November in a goodwill gesture.
Tokyo also partially lifted the curbs on exports of photoresist ahead of their summit in December. But no more progress has since been made.
  In March, the two countries held 16-hour talks that ended with no significant progress as well.
  As the two countries’ relations have further soured in the wake of the COVID-19 pandemic, it is unlikely they will resolve the trade row anytime soon.
  At the early stages of the pandemic, Tokyo decided to suspend its visa-waiver program for South Korean nationals. In response, Seoul ended its own entry program for Japanese visitors.
So far, the trade row has caused more damage to Tokyo’s exports than the other way around.
  South Korea’s exports to Japan slipped 6.9 percent to US$28 billion in 2019 from a year earlier. Its imports from Japan fell at a wider margin of 12.9 percent to $47 billion.

NWS_a39. WORLDecr: “OFAC Says Amex Violated US Sanctions by Issuing Card to Designated German National”

(Source: WORLDecr, 7 May 2020) [Excerpts]
 
  The US Department of the Treasury’s Office of Foreign Assets Control (‘OFAC’) has issued a ‘Finding of Violation’ notice to American Express Co. (‘AmEx’), after one of the company’s subsidiaries outside the United States mistakenly supplied a prepaid card to a German national sanctioned for alleged links to a black market nuclear network.OFAC said that AmEx had remediated and disclosed the violations to OFAC, so was not fined …. 
   In 2015, American Express Travel Related Services Co. issued the card to Gerhard Wisser, a German engineer who had been accused by US authorities of involvement in an alleged black market network run by Dr. Abdul Qadeer Khan, the scientist behind Pakistan’s atom bomb. 
  After issuing the card to Wisser, the AmEx subsidiary is said to have processed 41 transactions totaling $35,246.82, in violation of US sanctions, though OFAC said it had concluded that there was no willful or reckless behavior by AmEx because the card was issued by mistake. … 
  OFAC said that Amex’s automatic approval of applications, in instances where the risk engine led to a system timeout, was a critical shortcoming of its compliance program, and added, “This case highlights the importance of taking the steps necessary to ensure that automated sanctions compliance controls measures cannot be overridden without appropriate review.”

COM COMMENTARY

(Source:
Arent Fox, 11 May 2020) [Excerpts]
 
* Principal Author: 
Kay C. Georgi
, Esq., 1-202-857-6293, 
Arent Fox LLP
 
As the COVID-19 pandemic has expanded exponentially, so too has the demand by hospitals and other healthcare providers for masks and other medical personal protective equipment (PPE) to protect doctors, nurses, and other healthcare workers. A number of governments have imposed export controls on the export of a variety of medical (and industrial) PPE. In other words, if you want to import face masks into the US from a European country, you need a license to export them from the EU first.
 
This Alert has been updated with new information as of May 11, 2020.
Today, May 11, we updated the Reference Guide most recently circulated on April 28th with a listing of governments that have (and have not) imposed export controls on a variety of medical (and industrial) PPE.
 
 
New Countries

We have added information from Azerbaijan, which recently extended its earlier ban on exports of certain medical products; as well as from Cambodia and Sri Lanka, which recently rescinded bans on the export of masks.
 
New & Modified Restrictions

Since we last updated this Alert, no new countries have joined the list of states restricting the export of PPE. However, we have edited the chart to reflect changed or modified restrictions in Argentina, Bahrain, Belarus, Bulgaria, the European Union, India, Indonesia, Pakistan, Russia, Taiwan, and Turkey.
As we reported previously, the pace at which countries impose new controls on PPE exports has slowed, a trend that has seemingly continued into this week. Notably, the EU’s loosening of restrictions was followed by Turkey’s lifting of its ban on the export of ventilators and disinfectants; while Russia reversed course by removing blanket export bans on a plethora of medical goods and PPE.

(Source: 
EU Sanctions, 11 May 2020)
 
* Author: Maya Lester, Esq., 44-20-7379-3550, Brick Court
 
The European Commission has published a 12-month Action Plan for a Comprehensive EU Policy on Preventing Money Laundering and Terrorist Financing, which includes a proposal to create a centralised AML/CFT supervisory body. A public consultation has also been launched, which is open until 29 July 2020. See press releasefactsheet and FAQs.
 
The 6 pillars of the Action Plan:
   (1) Effective application of EU AML/CFT rules for member states at national level, and monitoring at EU level;
   (2) An EU rulebook to assist EU member states in harmonising diverging interpretations of current EU rules, and to close loopholes;
   (3) An EU-wide supervisory system to ensure the private sector reduces AML/CFT risks. The supervisor may also be authorised to monitor and support the implementation of EU sanctions (asset freezes);
   (4) A coordination and support mechanism for member states’ Financial Intelligence Units to help identify transactions/conduct that could be linked to criminal activities;
   (5) Enforcing EU-level criminal law provisions and information exchanges between private and public bodies; and
   (6) EU’s global role: ensuring better alignment with the Financial Action Task Force (FATF) through its revised methodology (below).
 
Revised Methodology 
The Commission has also published revised methodology with which high-risk third countries with strategic deficiencies in their AML/CFT regimes can be identified with more clarity and transparency. The methodology will ensure greater cooperation and interaction with the FATF and its listing process, alongside autonomous assessment by the EU, and consultation of member states’ experts.
The Commission has also updated its high-risk third country list, which now aligns with that of the FATF:
 
Listed countries
: The Bahamas, Barbados, Botswana, Cambodia, Ghana, Jamaica, Mauritius, Mongolia, Myanmar, Nicaragua, Panama, and Zimbabwe.
Delisted countries
: Bosnia-Herzegovina, Ethiopia, Guyana, Lao People’s Democratic Republic, Sri Lanka, and Tunisia.

(Source: 
LinkedIn, 12 May 2020)
 
* Author: 
Nicholas Turner, Esq., 852-5998-7559, Steptoe & Johnson HK 
 
Here are five things that happened this week in the world of economic sanctions that I think you should know about.
  (1) The US Office of Foreign Assets Control (OFAC) announced a USD 257,862 settlement with a Kansas-based company for violations of the Cuban Assets Control Regulations (CACR). According to the OFAC enforcement release, the company sold agricultural products to a Cuban customer via its non-US affiliates without authorization under a general or specific license. (More on the case below.)
  (2) Here comes Congress. Senate Majority Leader Mitch McConnell said the US Congress could soon pass a bill directing the Trump administration to adopt targeted sanctions against Chinese officials responsible for human rights abuses in the Xinjiang Uighur Autonomous Region (XUAR). The bill also calls for export controls on US-origin items that could be used in China to “suppress individual privacy, freedom of movement, and other basic human rights.” Versions of the Uyghur Human Rights Policy Act were previously approved by the House of Representatives and the Senate in 2019.
  (3) Meanwhile, Senator Tom Cotton introduced the Li Wenliang Global Public Health Accountability Act of 2020 to authorize sanctions in connection with “deliberate concealment or distortion of information about public health emergencies of international concern.”
  (4) OFAC made administrative updates to 11 entries on the List of Specially Designated Nationals and Blocked Persons (the SDN List) to change their “aliases” to “weak aliases.” This seems like a small thing, but for people who have to review all of those name screening hits, it can make a big difference. As explained in FAQ 124, “OFAC does not expect that persons will screen for weak AKAs.”
  (5) The Financial Action Task Force (FATF) and the Middle East and North African Financial Action Task Force (MENAFATF) published their mutual evaluation report on the United Arab Emirates (UAE). Among other findings, the report highlights deficiencies in handling targeted financial sanctions (TFS), despite the UAE’s elevated sanctions risk profile. For example, according to the report, many regulated entities “are not aware of the requirement to immediately freeze funds and assets in case of exact match with sanction lists.”
 

Comments

As usual, OFAC has gifted us with some useful compliance advice in its latest settlement. This time, the agency reminds us of the importance of seeking professional advice before embarking on risky business. According to the enforcement release, the company’s management “developed a transaction structure that they incorrectly determined would” comply with the CACR. Specifically, the company’s US division coordinated with its non-US affiliates to make sales to a Cuban customer because management believed the US division could not directly export its products to Cuba. Furthermore, the company “failed to seek appropriate advice,” even though it theoretically could have relied on an existing general license in the CACR. 
OFAC could have brought a statutory maximum penalty of up to USD 2,149,230. Instead, the company paid just USD 257,862. (Not counting whatever it cost to investigate and remediate the issue.) Among the mitigating factors cited by OFAC: the company adopted a sanctions compliance program and brought in “outside counsel and export control consultants to conduct comprehensive training sessions” for company employees. 
 
Bonus item: Check out my article on Regulation Asia discussing the US government’s power to access records held by banks outside the United States during investigations into North Korea-related cyber crimes, with three takeaways for banks in Asia.

 
* Author: George R. Tuttle III, Esq., 1-415-254-5986, Tuttle Law
 
List 3 Exclusions Granted May 6, 2020
   On May 8, 2020 the USTR published in the Federal Register (85 FR 27489) 146 List 3 exclusions (2 subheading and 144 product specific plus revisions to 3 prior granted exclusions). Items included in this round of granted exclusions include chemicals, pigment pastes, machine tools, LED’s and more.
   List 3 exclusions are effective for goods entered from September 24, 2018 through August 7, 2020. Brokers, importers and other entry filers should use HTS 9903.88.46. 
 
List 4A Exclusions Granted May 8, 2020
   On May 8, the USTR posted a list of 4A exclusions that were granted on medical devices or supplies. These consist of 3 subheadings, 5 product specific items, and a modification to HTS 6407.90.9889.  
These exclusions are valid from September 1, 2019 through September 1, 2020. Click here for the list of the items on List 3 and List 4A. 
Brokers, importers and other entry filers should use HTS 9903.88.47 for these exclusions. 
  Reminder in order to recover duties
 
if the entries are unliquidated, a PSC needs to be filed; if the entries are liquidated, a protest needs to be filed within 180 days after the liquidation date to protect the right to receive a refund of duties paid.
   If an exclusion was amended or corrected by a later Federal Register notice, the extension comments must be submitted referencing the original published notice

.

TE EX/IM TRAINING EVENTS & CONFERENCES

 
* What:
“How to Mitigate the Export Compliance Technologies in a COVID-19 World”
* When: 

Ju
n
; 1:00 p.m. (EDT)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Jackson Wood
 
* Register

here 
or
 contact
 
Ashleigh Foor

1-
540-433-3977.

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EN EDITOR’S NOTES

EN_a116. Bartlett’s Unfamiliar Quotations

(Source: Editor)
  

*
Florence Nightingale (12 May 1820 – 13 Aug 1910; was a British social reformer and statistician, and the founder of modern nursing.  Nightingale came to prominence while serving as a manager and trainer of nurses during the Crimean War, in which she organized care for wounded soldiers.  She gave nursing a favorable reputation and became an icon of Victorian culture, especially in the persona of “The Lady with the Lamp” making rounds of wounded soldiers at night.)
  – “Every nurse ought to be careful to wash her hands very frequently during the day. If her face, too, so much the better.”

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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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