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20-0608 Monday “Daily Bugle”

20-06-08 Monday “Daily Bugle”

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Monday, 8 June 2020

  1. USTR Announces Product Exclusion Amendment Section 301 Investigation of China
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings)
  3. State/DDTC to provide DECCS Tips & Tricks Webinar on 10 Jun 2020
  4. Treasury/OFAC: “Issuance of Iran-related Frequently Asked Questions”
  5. EU Council: “Corrigendum to Council (EU) 2017/1509 Concerning Restrictive measures against the Democratic People’s Republic of Korea”
  1. Brinkwire: “China Opposes US Adding Chinese Entities to Export Control List”
  1. EU Sanctions: “OFAC Issues FAQs on Sanctions on Iranian Sectors of the Economy”
  2. Pillsbury: “U.S. Government Efforts to Eliminate Supply Chain Threats from China to Telecommunications Networks”
  3. Thompson Hine: “OFAC Issues FAQs Related to Sanctions on Iran’s Construction, Mining, Manufacturing and Textile Sectors”
  1. Monday List of Ex/Im Job Openings: 75 Jobs Available – 16 New Job Listings This Week 
  1. 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

(Source: Federal Register) [Excerpts]

 
85 FR 34798: Notice
 
* AGENCY: Office of the United States Trade Representative.
* ACTION: Notice.
* SUMMARY: Effective July 6, 2018, the U.S. Trade Representative imposed additional duties on goods of China with an annual trade value of approximately $34 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’s determination included a decision to establish a product exclusion process. The U.S. Trade Representative initiated the exclusion process in July 2018, and stakeholders have submitted requests for the exclusion of specific products. In December 2018, March, April, May, June, July, September, October, December 2019, and February and May 2020, the U.S. Trade Representative issued determinations to grant exclusion requests and issue amendments. This notice announces the U.S. Trade Representative’s determination to make a technical amendment to one previously granted exclusion.
* DATES: The technical amendment announced in this notice is retroactive to the date of publication of the original exclusion and does not extend the period for the original exclusion. U.S. Customs and Border Protection will issue instructions on entry guidance and implementation.

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

OGS OTHER GOVERNMENT SOURCES

 

* State/DDTC; RULES; International Traffic in Arms Regulations:

Temporary Suspension, Modification, or Exception to Regulations During SARS-COV2 Public Health Emergency: Request for Comment; [Pub. Date: 10 Jun 2020]
[PDF

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

OGS_a23. Commerce/BIS: (No new postings)

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

(Source: Treasury/OFAC
, 6 Jun 2020
)
 
Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing new Frequently asked questions related to Executive Order 13902, “Imposing Sanctions With Respect to Additional Sectors of Iran.”
 
Executive Order (E.O.) 13902, “Imposing Sanctions With Respect to Additional Sectors of Iran”
 
Q. Will OFAC target Iranian manufacturers of medicines, medical devices, or products used for sanitation or hygiene or as personal protective equipment for use in Iran pursuant to Executive Order (E.O.) 13902 for continuing to manufacture these items?
 
A. No. For the purposes of evaluating sanctions pursuant to E.O. 13902, persons in Iran manufacturing medicines, medical devices, or products used for sanitation, hygiene, medical care, medical safety, and manufacturing safety, including soap, hand sanitizer, ventilators, respirators, personal hygiene products, diapers, infant and childcare items, personal protective equipment, and manufacturing safety systems, solely for use in Iran and not for export from Iran, will not be considered to be operating in the manufacturing sector of the Iranian economy. Note that persons conducting or facilitating transactions for the provision, including any sale, of agricultural commodities, food, medicine, or medical devices to Iran will not be subject to sanctions under E.O. 13902.
 
E.O. 13902 imposes sanctions with respect to any person determined by the Secretary of the Treasury, in consultation with the Secretary of State, to operate in the construction, mining, manufacturing, and textiles sectors of the Iranian economy, and any additional sectors of the Iranian economy as may be determined by the Secretary of the Treasury, in consultation with the Secretary of State. Iranian and non-Iranian persons operating in these sectors could be subject to sanctions pursuant to E.O. 13902.
 
The United States maintains broad exceptions and authorizations that allow for the commercial sale and export of humanitarian goods, including medicine and medical devices, to Iran or the Government of Iran from the United States or by U.S. persons or U.S.-owned or -controlled foreign entities. However, these authorizations and exceptions do not apply to transactions involving persons on OFAC’s List of Specially Designated Nationals and Blocked Persons (SDN List) that have been designated in connection with Iran’s support for international terrorism or proliferation of weapons of mass destruction, including designated Iranian financial institutions or the Islamic Revolutionary Guard Corps (IRGC), or in connection with activity that is subject to other sanctions not specific to Iran. For further guidance related to humanitarian trade with Iran and the provision of humanitarian assistance to Iran please see FAQ 828. [06-05-2020]

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

 
On the cover page and on page 1:
for:
‘COUNCIL IMPLEMENTING REGULATION (EU) 2020/730 of 3 June 2020 implementing Regulation (EU) 2017/1509 concerning restrictive measures against the Democratic People’s Republic of Korea’,
read:
‘COUNCIL IMPLEMENTING REGULATION (EU) 2020/730 of 2 June 2020 implementing Regulation (EU) 2017/1509 concerning restrictive measures against the Democratic People’s Republic of Korea’;
on page 1:
for:
‘Done at Brussels, 3 June 2020.’,
read: ‘Done at Brussels, 2 June 2020.’

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

COM NEWS

NWS_a17. Brinkwire: “China Opposes US Adding Chinese Entities to Export Control List”

(Source:
Brinkwire
, 8 Jun 2020)
 
China is firmly opposed to the United States adding 33 Chinese entities to its “entity list” of export controls, a Ministry of Commerce spokesperson said Friday
 
In response to media inquires, the spokesperson voiced objections to the U.S. action of once again adding Chinese enterprises, universities, research institutions and individuals to the “entity list” on the grounds of so-called “military ties” and “human rights.”
 
By repeatedly abusing export controls and other measures under the pretext of national security and using state power to suppress companies in other countries, the United States has severely disrupted the international economic and trade order, the spokesperson said, adding that it also posed severe threats to the security of the global industrial and supply chains.
 
“Such action is not conducive to China, the United States or the international community,” said the spokesperson. “We urge the United States to immediately stop its wrongful action, and we will take all necessary measures to safeguard Chinese companies’ legitimate rights and interests.”

COM COMMENTARY

(Source:
EU Sanctions,
8 Jun 2020)
 
* Author: Maya Lester, Esq.,
44

20

7379

3550
, Brick Court
 
OFAC has published new FAQs relating to Executive Order (E.O.) 13902, which provides for targeted sanctions against those determined to be operating in the construction, mining, manufacturing, and textiles sectors of the Iranian economy, and against people/entities providing material/financial/technological support or goods/services to a designated person under the E.O., including foreign financial institutions. Notice.
 
The FAQs provide:
 
(1) Definitions of each sector and activities within that sector which may be sanctionable;
 
(2) Definitions of goods or services used in connection with each sector which may be subject to sanctions;
 
(3) Confirmation that goods or services that ensure the protection of life and prevention of injuries are excluded from sanctions;
 
(4) Confirmation that people/entities in Iran manufacturing medicines, medical devices, or products used for sanitation, hygiene, medical care, medical and manufacturing safety solely for use in Iran are not considered to be operating in the manufacturing sector of the Iranian economy for the purposes of the E.O.; and
 
(5) How the terms “knowingly” and “significantly” are interpreted in the context of the E.O.

(Source: Global Trade and Sanctions Blog, 5 Jun 2020)
 
* Principal Author: Stephan E. Becker, Esq., 1-202-663-8277, Pillsbury
 
The U.S. government has issued several rules aimed at excluding, and in some cases removing, Chinese-origin equipment from U.S. telecommunications networks. Most of these rules apply to U.S. government networks, but some extend to private sector telecom infrastructure and services with no nexus to the U.S. government.
 
Wireline Competition Bureau


On May 5, 2020, the Wireline Competition Bureau of the Federal Communications Commission (FCC) published a public notice seeking comments on Section 4 of the Secure and Trusted Communications Networks Act of 2019 (Secure Networks Act). The Secure Networks Act, which was signed into law on March 12, 2020, directs the FCC to publish a list of covered communications equipment or services that pose a national security threat, which is established by meeting two criteria:
 
(1)
Equipment or services that are produced or provided by any entity that “poses an unacceptable risk to the national security of the United States or the security and safety of United States persons”; and
(2)
The equipment or services must be capable of:
 
(a) 
routing or redirecting user data traffic or permitting visibility into any user data or packets that such equipment or service transmits or handles;
(b) 
causing the network of a provider of advanced communications service to be disrupted remotely; or
(c) 
otherwise posing an unacceptable risk to the national security of the U.S. or the security and safety of U.S. persons.
 
The FCC initially designated Huawei and ZTE as posing “an unacceptable risk to the national security of the United States,” but it is authorized to identify additional foreign equipment and services providers as national security threats pursuant to the criteria in the Secure Networks Act.
Section 4 of the Secure Networks Act directs the FCC to establish a reimbursement program for “providers of advanced telecommunications services” with two million or fewer subscribers to remove and replace equipment from companies that pose a national security threat, if the equipment was obtained prior to August 14, 2018. Eligible providers who apply and receive funds through the reimbursement program will have up to one year after receipt to remove (i.e., “rip and replace”) the covered equipment, with the possibility of a six-month extension when warranted.
 
Securing the Information and Communications Technology and Services Supply Chain


On May 13, 2020, President Trump extended for one year the national emergency he declared on May 15, 2019 pursuant to Executive Order (E.O.) 13873 (Securing the Information and Communication Technology and Services Supply Chain). The E.O. declared a national emergency to deal with the threat posed by the use of information and communications technology in the U.S. “supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of foreign adversaries.” The E.O. was implemented through a proposed rule published by the Commerce Department on November 27, 2019, on Securing the Information and Communications Technology and Services Supply Chain (ICTS Proposed Rule), which we previously discussed. While the E.O. and the ICTS Proposed Rule do not explicitly reference any country or specific companies, Huawei and ZTE are believed to be the primary targets of these measures.
 
National Defense Authorization Act


Section 889(a)(1) of the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (the 2019 NDAA) imposes prohibitions on government and private sector use of “covered telecommunications equipment or services,” which are defined by the 2019 NDAA as:
 
(i)
Telecommunications equipment produced by Huawei or ZTE
(or any subsidiary or affiliate of such entities);
 
(ii)
For the purpose of public safety, security of government facilities, physical security surveillance of critical infrastructure, and other national security purposes, video surveillance and telecommunications equipment produced by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua Technology Company (or any subsidiary or affiliate of such entities);
 
(iii)
Telecommunications or video surveillance services provided by such entities or using such equipment; or
 
(iv)
Telecommunications or video surveillance equipment or services produced or provided by an entity that is owned or controlled by, or otherwise connected to, the government of a “covered foreign country,” which is defined as China.
 
The U.S. government is prohibited from procuring or obtaining any equipment, system, or service that uses “covered telecommunications equipment or services” as a substantial or essential component of any system, or as a critical technology as part of any system. On August 13, 2019, an interim Federal Acquisition Regulation (FAR) provision was promulgated by the U.S. Department of Defense (DOD), the General Service Administration (GSA) and the National Aeronautics and Space Administration (NASA) that implements Part A of Section 889(a)(1) government-wide. The interim rule includes the following provisions:

prohibits contractors from selling “covered telecommunications equipment or services,” baring an exception granted by GSA.

requires every solicitation, contract, or order to include a certification whereby the contractor represents whether or not it will provide “covered telecommunications equipment or services” as part of its offer.

Mandates that contractors report any “covered telecommunications equipment or services” discovered during the performance of a contract.
 
Effective August 2020, the U.S. Government will
be prohibited from entering into or extending or renewing a contact with an entity that uses any equipment, system, or service that utilizes or relies on “covered telecommunications equipment or services” as a substantial or essential component of any system, or as critical technology as part of any system, as set forth in Part B of Section 889(a)(1).

While Part A prohibits federal agencies from purchasing and using certain equipment, Part B provides a strong deterrence against private sector actors using “covered telecommunications equipment or services.”

 Notably, Part B does not include exceptions for entities that use “covered telecommunications equipment or services” on contracts with no nexus to the federal government or exclusively for internal use. The General Services Administration (GSA) is drafting an interim rule implementing the prohibitions set forth in Part B. Depending on how the implementing rule is drafted, Part B has the potential to have an extremely broad reach and may impact downstream subcontractors. In any event, given the breadth of the prohibitions in Part B, GSA (like the Commerce Department did in implementing Part A of Section 889(a)(1)) may extend the effective date to give contractors the necessary time to comply with the scope of the interim rule after it is issued.

(Source: Trump and Trade, 5 June 2020)
 
* Author: Joyce Rodriguez, Esq., 1-
202

973

2724
, Thompson Hine
 
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has issued four new Frequently Asked Questions (FAQs) related to Executive Order (E.O.) 13902, “Imposing Sanctions With Respect to Additional Sectors of Iran.” The FAQs address the manufacture of medicines, medical equipment and sanitation products in Iran, the scope of sectors targeted in Iran, the definition of “goods or services used in connection with” those sectors, and how the terms “knowingly” and “significant” will be interpreted. OFAC expects regulations to be promulgated consistent with these FAQs.
 
In January 2020, President Trump issued E.O. 13902, which, among other things, authorizes the Secretary of Treasury in consultation with the Secretary of State to block all property and interests in property of all persons:
 
Operating in the construction, mining, manufacturing or textile sectors of the Iranian economy (“Sectors”); and
Knowingly engaged in a significant transaction for the sale, supply or transfer to or from Iran of significant goods or services in connection with the Sectors.
The E.O. also authorizes the Secretary of Treasury to impose sanctions on foreign financial institutions (FFI) determined to have “knowingly” conducted or facilitated any “significant” financial transaction for the sale, supply, or transfer to or from Iran of significant “goods or services used in connection with” the Sectors covered by the E.O.
 
In sum, the four OFAC FAQs numbered 831, 832, 833, and 834 clarify the scope of potential sanctions under the E.O. as follows:
 
(1) 831: OFAC will not target Iranian manufacturers of medicines, medical devices, or products used for sanitation, hygiene, medical care, medical safety, and manufacturing safety, including soap, hand sanitizer, ventilators, respirators, personal hygiene products, diapers, infant and childcare items, personal protective equipment, and manufacturing safety systems, solely for use in Iran;
 
(2) 832: OFAC defines the terms “construction sector of the Iranian economy,” “mining sector of the Iranian economy,” “manufacturing sector of the Iranian economy,” and “textiles sector of the Iranian economy;”
 
(3) 833: OFAC defines the scope of “goods and services used in connection with” as to each of the Sectors; and
 
(4) 834: OFAC interprets the term “knowingly” as it is defined in the Iranian Financial Sanctions Regulations at 31 C.F.R. § 561.314, and “significant” through a “totality of the circumstances” analysis of certain enumerated broad factors.
While OFAC’s guidance does indicate that the sanctions will not target certain activity related to health and safety of persons in Iran, the scope of the potential sanctions remains very broad.

TE EX/IM MOVERS & SHAKERS

MS_a1
11. Monday List of Ex/Im Job Openings: 75 Jobs Available; 16 New Job Openings This Week

(Source: Events & Jobs Editor)
 
NEW JOBS:
 
* All Points Logistics; Houston, TX;
Export Control Principal Analyst
* AutoZone; Memphis, TN;
Global Logistics Manager
 
* Clevel; Cleveland County, OK;
International Compliance Program Director
 
* EF Johnson Technologies; Irving, TX;
Import/Export Specialist
 
* FLIR;
North Billerica, MA
; Manager, Investigations & Disclosures
 
*
HOYA
;
Chino Hills
, CA;
Regulatory Affairs Specialist
 
 
* MBDA;
Stevenage
, UK;
Head of Export Compliance
 
* PNNL; Richland, WA;
Export Control Professional
 
*
Renesas Electronics Americas
;
Milpitas, CA
;
Director, Global Trade Compliance
 
*
Rockwell Automation
;
Capelle aan den Ijssel
; Netherlands;
Classification Specialist
 
*
Solvay
;
Princeton, NJ
;
North America Customs Expert
 
 
* TDK; Munich, Germany;
Export Control Manager
 
* Western Digital;
Leatherhead
, UK;
EMEA Trade Compliance Manager

 
All Job Openings:  Click here to see the complete list of job openings. 

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TE EX/IM TRAINING EVENTS & CONFERENCES

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

EN EDITOR’S NOTES

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

 

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.

5 June 2020: 85 FR 34495 and 85 FR 34503: Additions and Amendments of the Entity List.      
 
 
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, Notice (not an amendment) 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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