;

T2 4.20

20-0420 Monday “Daily Bugle”

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Monday, 20 April 2020

(No items of interest today.) 
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings.)
  3. State/DDTC: (No new postings.)
  4. DHS/CBP: “90 Day Postponement of Payment for the Deposit of Certain Estimated Duties, Taxes, and Fees”
  5. UK ECJU Presents “COVID-19 Effects on Export Controls and Licenses” Webinar on Wednesday, 22 Apr
  6. UK ECJU Updates Trade and Investment Core Statistics Book
  1. Export Compliance Daily: “No Need for Additional Humanitarian-Related General Licenses, OFAC Director Says”
  2. ST&R Trade Report: “Duty Savings and Compliance Efforts Aided by ACE Reports”
  3. WORLDecr: “South Korea Set to Resume Humanitarian Exports to Iran Under New OFAC Licence”
  1. Arent Fox: “FEMA: Certain Exports of Respirators, Masks, and Gloves (PPE) Exempt From Ban”
  2. Baker McKenzie: “FEMA Announces Additional Exemptions to Restrictions on Exports of PPE from the U.S.”
  3. Steptoe: “Considerations for Conducting Remote Internal Investigations” (Part II of III)
  4. Thompson Hine: “OFAC Issues Fact Sheet on Providing Humanitarian Aid to Combat COVID-19 Under Various Sanctions Programs”
  1. Monday List of Ex/Im Job Openings: 150 Jobs Available – 23 New Job Openings This Week 
  1. ECTI Presents: Classifying Aircraft Part Technology Webinar: April 22
  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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  5. Submit Your Event and View All Approaching Events

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OGSOTHER GOVERNMENT SOURCES

OGS_a11.
Items Scheduled for Future Federal Register Editions 
(Source: Federal Register)
 

* USITC; NOTICES; Investigations; Determinations, Modifications, and Rulings, etc.: Extend Postponement of all In-Person Section 337 Hearings Until June 10, 2020; [Pub. Date: 21 Apr 2020]

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

OGS_a22. 
Commerce/BIS: (No new postings.)

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

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

OGS_a44.
DHS/CBP: “90 Day Postponement of Payment for the Deposit of Certain Estimated Duties, Taxes, and Fees”

(Source: DHS/CBP, 19 Apr 2020)
 
On April 20, 2020, the Secretary of the Treasury and U.S. Customs and Border Protection (CBP) will be postponing for 90 calendar days the deadline for payment for the deposit of certain estimated duties, taxes, and fees for importers experiencing a significant financial hardship due to the coronavirus disease (COVID-19). This temporary postponement applies to formal entries of merchandise entered, or withdrawn from warehouse, for consumption (including entries for consumption from a Foreign Trade Zone) in March or April 2020.  CBP will not return deposits of estimated duties, taxes, and fees that have already been paid.
This temporary postponement does not apply to any entry, or withdrawal from warehouse, for consumption, where the entry summary includes merchandise subject to one or more of the following:
 
(1)
Antidumping duties,
(2)
Countervailing duties,
(3)
Duties assessed pursuant to Section 232 of the Trade Expansion Act of 1962
(4)
Duties assessed pursuant to Section 201 of the Trade Act of 1974, and
(5)
Duties assessed pursuant to Section 301 of the Trade Act of 1974.
 
No interest will accrue for the postponed payment of such estimated duties, taxes, and fees during this 90-day postponement period. No penalty, liquidated damages, or other sanction will be imposed for the postponed payment of the deposit of estimated duties, taxes, and fees in accordance with this temporary postponement.
 
This temporary postponement does not apply to deadlines for the payment of other debts to CBP, including but not limited to deadlines for the payment of bills for duties, taxes, fees, and interest determined to be due upon liquidation or reliquidation, deadlines for the payment of fees authorized pursuant to 19 U.S.C. 58c (except for merchandise processing fees and dutiable mail fees), or deadlines for the payment of any penalty or liquidated damages due to CBP.
 
To determine the amount of estimated duties, taxes, and fees owed, the date used for calculation remains the date that would have otherwise applied in the absence of the 90-day postponement period.
 
For entries eligible for this temporary postponement, the requirement to pay the deposit of estimated duties, taxes, and fees for the purpose of establishing the time of entry stated in 19 CFR § 141.68 is waived.
The timeframe for entry summary filing is not changed.
 
SIGNIFICANT FINANCIAL HARDSHIP
An iporter will be considered to have a significant financial hardship if the operation of such importer is fully or partially suspended during March 2020 or April 2020 due to orders from a competent governmental authority limiting commerce, travel, or group meetings due to COVID-19, and as a result of such suspension, the gross receipts of such importer for March 13-31, 2020 or April 2020 are less than 60 percent of the gross receipts for the comparable period in 2019.
 
An eligible importer does not need to file documentation with CBP to be eligible for this relief but must maintain documentation as part of its books and records establishing that it meets the requirements for relief. CBP may also conduct a review of the documentation at a future date to ensure compliance with the requirements.
 
ENTRIES NOT ELIGIBLE FOR THE 90-DAY POSTPONEMENT
This temporary postponement of payment of estimated duties, taxes, and fees does not apply to any entry, or withdrawal from warehouse, for consumption, where the entry summary includes merchandise subject to antidumping duties, countervailing duties and/or Section 201, 232 or 301 duties.  
 
In order to take advantage of the 90-day postponement period, importers/filers must ensure their entries do not include merchandise that is ineligible for the postponed payment. If, for example, an entry is filed with merchandise subject to antidumping duties, AND merchandise not subject to antidumping duties, the entire entry will NOT be eligible for the 90-day postponed payment.   As an alternative, CBP is authorizing the submission of separate entries pursuant to 19 CFR § 141.52. This authorization only applies to entries that have not yet been filed; it does not apply to entries that have already been filed. So if, as in the above example, a shipment has merchandise subject to antidumping duties, AND merchandise not subject to antidumping duties, two separate entries can be made.
 
PAYMENT TIMEFRAMES
Estimated duties, taxes, and fees paid on single pay basis or Daily Statement may be postponed up to 90 days from the payment due date.
Example:
Original Due Date
90-Day Postponement
April 30, 2020
July 29, 2020
 
Estimated Internal Revenue Tax paid via the deferred tax schedule may be postponed up to three months from the payment due date.
Example:
Original Due Date
3 Month Postponement
April 29, 2020
July 29, 2020
May 14, 2020
August 14, 2020
 
Read more about the payment instructions here

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

OGS_a55.
UK ECJU Presents “COVID-19 Effects on Export Controls and Licenses” Webinar on Wednesday, 22 Apr

(Source: UK ECJU, 20 Apr 2020)

 

The UK Export Control Joint Unit (ECJU) will be co-hosting a webinar with the Export Control Profession on Wednesday 22 April 2020 to discuss issues of importance to exporters of controlled items during the COVID-19 crisis.
Topics will include:
  • continuation of export licensing during the pandemic
  • EU controls relating to Personal Protective Equipment (PPE) and how they apply to the UK
  • controls on medical supplies
  • the importance for Export Control staff to communicate with their companies and supply chains
  • the response of the Institute of Export and International Trade (IOE&IT) and the Export Control Profession board to the crisis

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

(Source:  
UK ECJU
, 17 Apr 2020)

ECJU updated with the latest statistical data the snapshot of the UK’s trade and investment position, summarising trade statistics produced by ONS, HMRC, DIT and others.
 
The core statistics book provides detailed figures on:

 

– exports

– imports

– the trade balance

– total trade

– current account balance

– the UK’s bilateral trade surpluses and deficits

– trade in value added

– foreign direct investment (FDI)

– regional trade statistics

 
Find the updated document
here.

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

COMNEWS

NWS_a17. Export Compliance Daily: “No Need for Additional Humanitarian-Related General Licenses, OFAC Director Says”

(Source
:
Export Compliance Daily, 20 Apr 2020) [Excerpts]

Despite calls from industry and lawmakers, the Treasury Department does not plan to introduce new authorizations for humanitarian exports to Iran, said Andrea Gacki, director of the Office of Foreign Assets Control. Gacki said OFAC’s current general licenses are sufficient, adding that the agency has not received many license applications to export medical goods that are not already covered by an existing exemption.

“We’re just not seeing a ton of requests to export [personal protective equipment],” Gacki said during an April 17 webinar hosted by the Center for a New American Security. She said that is partly due to the recent export restrictions on medical equipment announced by the Federal Emergency Management Agency earlier this month. And while she said OFAC has “considered” issuing a “special authorization” that specifically applies to the COVID-19 pandemic response measures, Gacki said OFAC’s existing exemptions — which allow for exports of a broad range of disease-fighting equipment, such as ventilators, face masks and medical robes — should cover industry’s needs.

“OFAC has greatly expanded the types of humanitarian authorizations that are standing, so that when something like this happens, it does not mean that the U.S. government has to start from scratch and build something new in order for aid to flow,” Gacki said.

NWS_a28. ST&R Trade Report: “Duty Savings and Compliance Efforts Aided by ACE Reports”

(Source
:
Export Compliance Daily, 20 Apr 2020) [Excerpts]

Despite calls from industry and lawmakers, the Treasury Department does not plan to introduce new authorizations for humanitarian exports to Iran, said Andrea Gacki, director of the Office of Foreign Assets Control. Gacki said OFAC’s current general licenses are sufficient, adding that the agency has not received many license applications to export medical goods that are not already covered by an existing exemption.

“We’re just not seeing a ton of requests to export [personal protective equipment],” Gacki said during an April 17 webinar hosted by the Center for a New American Security. She said that is partly due to the recent export restrictions on medical equipment announced by the Federal Emergency Management Agency earlier this month. And while she said OFAC has “considered” issuing a “special authorization” that specifically applies to the COVID-19 pandemic response measures, Gacki said OFAC’s existing exemptions — which allow for exports of a broad range of disease-fighting equipment, such as ventilators, face masks and medical robes — should cover industry’s needs.

“OFAC has greatly expanded the types of humanitarian authorizations that are standing, so that when something like this happens, it does not mean that the U.S. government has to start from scratch and build something new in order for aid to flow,” Gacki said.

NWS_a39. WORLDecr: “South Korea Set to Resume Humanitarian Exports to Iran Under New OFAC Licence”

(Source: WORLDecr, 17 Apr 2020) [Excerpts]
 
South Korea is gearing up to resume humanitarian exports to Iran under a special licence published by the US Office of Foreign Assets Control (‘OFAC’), with shipments likely to begin in May.
South Korea’s Yonhap news agency quoted a foreign ministry official as saying that exports will resume under General License No. 8, issued by OFAC in late February to authorise certain humanitarian transactions with the Central Bank of Iran (‘CBI’), which is targeted by US sanctions.
 
‘On April 6, the humanitarian export process based on the General License No. 8 got under way,’ the unidentified official said. ‘Our companies and banks should prepare documents needed to carry out enhanced due diligence, and we think that the shipments may begin about a month later.’
 
The official was quoted as saying that, apart from trading under the OFAC licence, South Korea is also pushing for the Korean Humanitarian Trade Arrangement (‘KHTA’), which uses an Iranian bank free from US sanctions – such as the Middle East Bank – to facilitate humanitarian transactions with the Islamic Republic.
 
Korea is also exploring how to tap to into the Swiss Humanitarian Trade Arrangement (‘SHTA’), a payment gateway designed for exports to Iran by Switzerland-based companies, according to the state-run news agency.
 
‘South Korea is pushing for all three methods,’ the official said. He noted that the General License No. 8 platform appeared to be the fastest way to resume humanitarian exports to Iran, which has faced shortages of medicines and equipment to fight the pandemic due to US sanctions.
 

Although Washington insists that humanitarian exports are not subject to the embargo on Iran, Yonhap said that South Korean firms had been hesitant to resume such sales for fear of breaching the sanctions. 

COMCOMMENTARY

COM_a110. Arent Fox: “FEMA: Certain Exports of Respirators, Masks, and Gloves (PPE) Exempt From Ban”

(Source: Arent Fox, 20 Apr 2020)
 
* Principal Author: Sylvia Costelloe, Esq., 1-213-988-6697, Arent Fox LLP
 
The Federal Emergency Management Agency has left many important questions blowing in the wind as a result of a Notification of Exemptions action published for public inspection on Friday, April 17, 2020. The final action will be published on April 21, 2020.
 
In a Nutshell
Late Friday afternoon, FEMA published a list of exemptions (“Prioritization and Allocation of Certain Scarce or Threatened Health and Medical Resources for Domestic Use; Exemptions“) to its requirement for prior approval to export previously identified scarce medical personal protective equipment (PPE). Key among these exemptions are exports by companies to non-US affiliates, exports to Canada and Mexico and certain diplomatic, military and humanitarian donation exports. Despite the attempt to clarify previous rules and guidance, FEMA’s notice raises nearly as many questions as it answers.
 
Background
As we reported in our April 8 alert, FEMA issued a temporary final rule (“Prioritization and Allocation of Certain Scarce or Threatened Health and Medical Resources for Domestic Use“) on April 7, published in the Federal Register on April 10, banning the exports of five types of medical PPE[FN/1] that the US Government previously identified as scarce and threatened material in the COVID-19 pandemic.
 
US Customs and Border Protection (CBP) followed up with a memorandum on April 9 (“Updated Guidance for the Presidential Memorandum Regarding Allocation Certain Scarce or Threatened Health and Medical Resources to Domestic Use“) addressed to Directors, Field Operations with guidance on the scope of the FEMA’s Temporary Final Rule. According to the CBP memo, FEMA had conveyed to CBP that the export prohibition is focused on commercial quantities that are valued over $2,500 and contain more than 10,000 units of scarce material. The memo also excluded the following:
 
– Exports to Canada or Mexico;
– Exports to US Government entities such as US military bases overseas;
– Exports by US Government agencies;
– Exports by US charities;
– Exports by critical infrastructure industries for the protection of their workers;
– Exports by the 3M Company;
– Express or Mail Parcels that do not meet the commercial quantity definition above; and
– In-transit shipments
 
We understand CBP issued this as interim guidance while FEMA worked to issue a formal Federal Register Notice. While CBP and FEMA are working together, FEMA is the lead agency with responsibility for determining exemptions and CBP is responsible for implementation.
 
New Action: FEMA Issues List of Exemptions
As discussed, on April 17, 2020, FEMA issued a public inspection copy of a Federal Register Notice setting forth additional exemptions to the export ban. The Notice will be published in the Federal Register on April 21 but is effective on the “date of filing for publication in the Federal Register,” which we believe is April 17. These exemptions are in addition to the original exemption allowing for exports to continue if the US party has continuous export agreements in place since at least January 1, 2020, and 80% of the manufacturer’s domestic production of the scarce materials, on a per-item basis, was distributed in the United States in the preceding 12 months, which was set forth in the Temporary Final Rule.
 
However, the Notice’s exemptions are not exactly the same as those stated in the CBP Memo. The Notice does not mention the CBP Memo, which was directed to aid CBP field offices in the enforcement of the export ban until FEMA issued additional guidance. Consequently, it is unclear if CBP field offices will continue to follow the CBP Memo or if exemptions identified in that Memo are now superseded by the FEMA Notice. We expect CBP may issue further guidance to replace the April 9 memorandum and align with the FEMA notice.
 
What Are the FEMA Exemptions?
The FEMA exemptions are as follows:
 
Shipments to US Commonwealths and Territories, Including Guam, American Samoa, Puerto Rico, US Virgin Islands, and the Commonwealth of the Northern Mariana Islands (Including Minor Outlying Islands).
Exports of covered materials by non-profit or non-governmental organizations that are solely for donation to foreign charities or governments for free distribution (not sale) at their destination(s).
Intracompany transfers of covered materials by us companies from domestic facilities to company-owned or affiliated foreign facilities.
Shipments of covered materials that are exported solely for assembly in medical kits and diagnostic testing kits destined for US sale and delivery.
Sealed, sterile medical kits and diagnostic testing kits where only a portion of the kit is made up of one or more covered materials that cannot be easily removed without damaging the kits.
Declared diplomatic shipments from foreign embassies and consulates to their home countries. These may be shipped via intermediaries (logistics providers) but re-shipped from and consigned to foreign governments.
Shipments to overseas us military addresses, foreign service posts (e.g., diplomatic post offices), and embassies.
In-transit merchandise: shipments in transit through the united states with a foreign shipper and consignee, including shipments temporarily entered into a warehouse or temporarily admitted to a Foreign Trade Zone.
Shipments for which the final destination is Canada or Mexico.
Shipments by or on behalf of the US Government, including its military.
The FEMA notice also warns that if CBP suspects a manufacturer, broker, distributor, exporter, or shipper of any covered materials to be intentionally modifying or diverting its shipments to take advantage of these exemptions, or otherwise trying to circumvent the FEMA review requirements, CBP may detain the shipment and forward information about such shipments to FEMA for determination.
 
Using an Exemption
For exemptions (2), (3), (4), (8), and (9), above, FEMA will require a letter of attestation to be submitted to FEMA via CBP’s Document Imaging System within CBP’s Automated Commercial Environment (ACE), certifying the purpose of the proposed shipment. The FEMA Notice also notes that “[t]he Administrator may waive any of these exemptions at any time and fully review shipments of covered materials under [the FEMA regulations] if the Administrator determines that doing so is necessary or appropriate to promote the national defense.”
 
While exemption (10) does not require a letter of attestation, if a shipment is being made by a contractor on behalf of the US Government and this may not be clear on the face of this shipment (for example, it is not being made to a US Government base or facility, but is being made at the direction of the US Government to another location), then the exporter may also want to include a letter of attestation anyway to explain the details to avoid potential detention of the goods and associated delays.
 
What Are the Questions?
First, let’s thank FEMA for confirming shipments to a US commonwealth or territory such as Puerto Rico are exempt. None of us should have had to spend any time last week on a question like that (but we did, didn’t we?).
 
But the FEMA notice creates some other questions, such as:
 
– How do you get FEMA to approve anything else?
A key question left unanswered by FEMA is what about all other exports? This was an opportunity for FEMA to explain how an export that does not fall on the approved list can be approved. As we previously discussed, this question has been open since FEMA’s Temporary Final Rule was issued. How do exporters apply? Do they have to continue to try to export and hope for the best? Are all exports other than the 10 exemptions simply banned until the FEMA Temporary Rule expires on August 10?
 
What happened to critical infrastructure industries?
The CBP Memo stated that exports by critical infrastructure industries for the protection of their workers would be exempt, leading many of us to spend days trying to define “critical infrastructure” to our clients. FEMA has now exempted intracompany transfers of covered materials by US companies from domestic facilities to company-owned or affiliated foreign facilities. This is at once broader (all intra-company transfers) and narrower (one can imagine exports of covered materials to unrelated companies intended to protect critical workers abroad).
What about exports of materials for the manufacture of covered material that will be imported back into the US? FEMA has included a new exemption for shipments of covered materials that are exported solely for assembly in medical kits and diagnostic testing kits destined for US sale and delivery. This makes sense: if we export gloves to Mexico to be included in a medical kit to be brought back into the US, that export is now exempt.
 
But why limit this to items going into medical kits and diagnostic testing kits? For example, why not include items going into the covered materials itself if the covered materials are being reimported back into the United States? And what does that “solely” mean? Does every single glove exported from the United States have to go into a medical kit that is coming back into the United States?
 
Bottom Line
Exporters should carefully review their proposed exports to determine whether any of the above exemptions apply, prepare a letter of attestation for certain of the exemptions, and build in extra time for any shipments of items identified as scarce materials.
 
[FN/1] The five types of PPE that are restricted are:
 
N95 Filtering Facepiece Respirators, including devices that are disposable half-face-piece non-powered air-purifying particulate respirators intended for use to cover the nose and mouth of the wearer to help reduce wearer exposure to pathogenic biological airborne particulates;
Other Filtering Facepiece Respirators (e.g., those designated as N99, N100, R95, R99, R100, or P95, P99, P100), including single-use, disposable half-mask respiratory protective devices that cover the user’s airway (nose and mouth) and offer protection from particulate materials at an N95 filtration efficiency level per 42 CFR 84.181;
Elastomeric, air-purifying respirators and appropriate particulate filters/cartridges;
PPE surgical masks, including masks that cover the user’s nose and mouth and provide a physical barrier to fluids and particulate materials; and
PPE gloves or surgical gloves, including those defined at 21 CFR 880.6250 (exam gloves) and 878.4460 (surgical gloves) and such gloves intended for the same purposes.

COM_a211. Baker McKenzie: “FEMA Announces Additional Exemptions to Restrictions on Exports of PPE from the U.S.”

(Source:
Baker McKenzie Blog, 18 Apr 2020)

 
* Principal Author: Kerry B. Contini, Baker McKenzie
 
On April 17, 2020, the Federal Emergency Management Agency (“FEMA“) filed a 
notification of exemptions
(the “FEMA Notification“) in the Public Inspection List that identifies 10 exemptions from the 
temporary final rule
 
published on April 10, 2020 (the “FEMA Rule“), which restricts the export from the United States of certain personal protective equipment (“PPE Products“) used in the response to the COVID-19 pandemic. Although the FEMA Notification will not be published in the Federal Register until Tuesday, April 21, 2020, it became effective on April 17.
 
By way of brief background, the FEMA Rule, which is described in our prior blog post 
here
, imposed export restrictions on PPE Products pursuant to a 
Presidential Memorandum
 
dated April 3, 2020, which is described in our blog post 
here
. The FEMA Rule directed US Customs and Border Protection (“CBP“) to detain any shipments of the relevant PPE Products pending FEMA’s determination whether to return such shipments for domestic use, issue a rated order for the products, or allow the export of part of all of the shipment. On April 9, 2020, CBP issued internal guidance (available 
here
 
as of April 18, 2020 and described in our blog post 
here
) that listed a number of exclusions to the FEMA Rule. As clarified by CBP in recent days, the guidance was not meant to become public, and the criteria for exclusions were then still under discussion, with public guidance forthcoming from FEMA.  The FEMA Notification is the public version of the guidance prepared by FEMA and CBP.
 
Which Shipments Are Exempt from the FEMA Rule?
As described in our 
blog post
, the FEMA Rule contained only one narrow exemption, which was for shipments by or on behalf of US manufacturers with continuous export agreements with foreign customers since at least January 1, 2020 and a track record of distributing at least 80% of their supply of the PPE Products, on a per item basis, in the United States during the preceding 12 months.  That said, the FEMA Rule contemplated that FEMA may, in its discretion, establish additional exemptions. The exemptions set out in the FEMA Rule and the FEMA Notification (together, the “Exemptions“) differ in several respects from the exclusions set out in the internal CBP guidance.  Exporters should rely on the Exemptions in the FEMA Notification rather than the exclusions in the CBP internal guidance. 
The additional Exemptions under the FEMA Notification are as follows:
(1) Shipments to US commonwealths and territories, including Guam, American Samoa, Puerto Rico, US Virgin Islands, and the Commonwealth of the Northern Mariana Islands (including minor outlying islands).
(2) Exports by non-profit or non-governmental organizations that are solely for donation to foreign charities or governments for free distribution (not sale) at their destination(s).
(3) Intracompany transfers by US companies from domestic facilities to company-owned or affiliated foreign facilities.
(4) Exports of materials solely for assembly in medical kits and diagnostic testing kits destined for US sale and delivery.
(5) Sealed, sterile medical kits and diagnostic testing kits where only a portion of the kit is made up of one or more PPE Products that cannot be easily removed without damaging the kits.
(6) Declared diplomatic shipments from foreign embassies and consulates to their home countries, shipped from and consigned to foreign governments.
(7) Shipments to overseas US military addresses, foreign service posts (e.g., diplomatic post offices,) and embassies.
(8) In-transit merchandise such as shipments in transit through the United States with a foreign shipper and consignee and shipments temporarily entered into a warehouse or temporarily admitted to a foreign trade zone.
(9) Shipments for which the final destination is Canada or Mexico.
(10) Shipments by or on behalf of the US federal government, including its military.
The FEMA Notification includes additional detail about which types of shipments are eligible for each Exemption.   
Will Shipments that Qualify for an Exemption Be Detained by CBP?
The FEMA Notification does not specify how the Exemptions will be applied.  In the absence of further guidance, we assume that CBP would still temporarily detain shipments of PPE Products at the US border pending FEMA’s determination. FEMA will make a determination based on the applicable Exemptions and the “totality of circumstances” described in the FEMA Rule, including letters of attestation submitted by exporters to CBP for certain Exemptions. 
Which Documentation Should Exporters Submit to Claim an Exemption?
The FEMA Notification provides that exporters should submit a letter of attestation to FEMA via CBP’s document imaging system for exemptions 2, 3, 4, 8, and 9, certifying to FEMA the purpose of the shipment. The letter should be submitted to CBP with other documentation relating to each shipment and should contain: 
  • a description of which Exemption(s) the exporter is claiming;
  • details regarding the shipment sufficient for CBP and FEMA officials to determine whether the shipment falls under the claimed Exemption(s); and
  • a statement that the provided information is true and accurate to the best of the exporter’s knowledge, and that the exporter is aware that false information is subject to prosecution under the Defense Production Act.
Exporters interested in a template letter of attestation to satisfy an Exemption should reach out to their usual contacts in Baker McKenzie’s trade compliance group.
What Should Exporters Expect?
Although the FEMA Rule and the FEMA Notification set out a number of exemptions, exporters of PPE Products will likely continue to encounter delays at ports across the country, pending determinations by FEMA. The FEMA Rule does not mandate a specific time for FEMA to decide whether a particular export will be permitted, and it is not clear whether, when, or how exporters will be notified of the status of their shipment. Exporters that believe their shipment may be covered by an Exemption should provide letters of attestation and related transactional documents containing all relevant information through CBP as requested by FEMA to facilitate the process.

COM_a312. Steptoe: “Considerations for Conducting Remote Internal Investigations” (Part II of III)

(Source:
Steptoe
, 16 Apr 2020) [Part III will be published tomorrow]


 
* Principal Author:
Patrick F. Linehan
, Esq., 1-202-429-8154,
Steptoe & Johnson LLP
 
Confidentiality and Privilege Considerations
Remotely conducted interviews also pose challenges to the creation and preservation of an environment that sufficiently protects the interview’s confidentiality. Companies should consider the potential risks surrounding waiver of the attorney-client privilege, or equivalent protections outside the U.S., when conducting interviews remotely.
Under these circumstances, a company has considerably less control over who else, unbeknownst to the company, might be present during the interview or meeting.
 
Although U.S. courts take varying views on whether the presence of client agents (such as accountants, auditors, translators or other consultants) destroy the privilege, most U.S. courts hold that the privilege does not protect communications in the presence of third parties other than those who are necessary for the communications.[FN/7]
 
Thus, companies should be mindful that the presence of unnecessary third parties – such as a witness’s family or other cohabitants – during an interview may risk privilege waiver.[FN/8] Companies should explain this risk to employees and emphasize that no one other than the witness should be physically present or within earshot during the interview.
 
Both federal and state law, as well as ethical rules, may also require that parties undertake precautionary measures to avoid privilege waiver through the inadvertent disclosure of such communications to third parties.[FN/9] Companies should make best efforts to avoid inadvertent privilege waiver and document these efforts.
 
If it is necessary to provide company documents in advance of or during a remote interview, companies must take steps to protect their confidentiality. One option is to share documents on the screen during a videoconference, although this can have the effect of significantly minimizing the video display of the witness, which is already a compromise as compared to in-person interviews.
 
Another option is to send the documents shortly before the interview with security settings that prevent their further dissemination. A better alternative may be to set up a secure reading room that allows only the interviewees to access read-only copies of the documents for a restricted period of time.
But all of those options still pose a risk that the recipient may capture and disseminate information contained in the documents through other means, such as through screenshots or handwritten notes. To mitigate this risk, companies may want to monitor by videoconference witnesses’ access to documents during interviews or consider requiring that witnesses sign a nondisclosure agreement.
 
Additionally, employees working remotely may experience difficulty accessing their work- related email and other company systems, which can lead employees to rely on personal emails and devices as alternatives. Often the use of personal emails and devices is strictly prohibited by company policy for security and other reasons.
 
Where company policy does not prohibit use of personal email or devices, such use is unlikely, by itself, to automatically cause a waiver of an otherwise privileged communication if there is still a reasonable expectation of privacy in the communication.[FN/10]
 
But in some instances, personal email accounts are shared or accessible by family members, which create the same risk of privilege waiver as if a third party were present in the background during an interview. Companies should therefore discourage the use of personal email as much as possible.
To the extent such use cannot be avoided, companies should direct employees to use accounts to which only they have access and to include appropriate disclaimers (e.g., “privileged and confidential” or “prepared at the direction of counsel”) in communications with company counsel.
 
Interviewing Former and/or Separately Represented Employees
Conducting a thorough investigation often involves interviewing former employees or employees that are separately represented. Because there is an increased likelihood in remote interviews that former and/or separately represented employees will be located in different jurisdictions, and the rules between jurisdictions surrounding this contact vary substantially, companies should be mindful of the differences between each relevant
jurisdiction’s laws and carefully consider which laws would apply in a cross-jurisdictional interview.
 
Former Employees and Privilege
U.S. courts generally find that communications with former employees are privileged as long as the communications involve privileged information the employees obtained during their employment that relate to the lawyer’s ability to advise the company client.[FN/11]
 
The privilege may not survive, however, if the former employee’s current personal counsel[FN/12] is privy to the communication because the other lawyer’s presence would destroy the requisite confidentiality (absent entry into a joint defense or common interest agreement).[FN/13]
 
As such, investigators must be careful to ensure interviews of former employees are made in a way that preserves privilege, which for former employees means limiting discussions to only matters learned about during the employee’s employment and entering into a joint defense agreement covering the interview where applicable.
 
Although the above privilege rules apply generally, remote investigation settings may potentially implicate multiple U.S. states’ laws. Although the admissibility of privileged communications in federal proceedings will be governed by Federal Rule of Evidence 501, Rule 501 requires application of state privilege law in civil cases and privilege law “as interpreted by United States courts in the light of reason and experience” in criminal cases,[FN/14] which also typically looks to state law. This calls for an understanding of both all of the relevant states’ privilege laws (i.e., all of the states in which the interview participants are located) and federal courts’ interpretations of those laws.
 
Non-U.S. privilege laws should be considered as well. In the U.K., for example, communications with former employees are not protected by the legal advice privilege since that privilege only applies between a lawyer and client. Certain other forms of legal privilege may be available in the U.K., including where there is a common interest between the parties – but these protections are easily lost.
 
Similarly, while the interview notes of company lawyers are likely subject to litigation privilege in the U.K. (assuming they were prepared in the context and for the dominant purpose of litigation, which includes investigations), that privilege may be lost if the notes are shared with a third party, including the interviewee.
 
No-Contact Rule for Separately Represented Witnesses
Another important issue to consider when deciding whether to conduct a remote interview of a separately represented employee (whether current or former) is the American Bar Association’s Model Rule of Professional Conduct 4.2, also known as the no-contact rule. This rule generally prohibits a lawyer from communicating with a nonclient whom the lawyer knows to be represented in the matter by another lawyer, subject to certain exceptions.[15]
 
Because the parameters of the rule differ across states, companies conducting investigations remotely should be mindful of the rules that are potentially applicable to a cross-jurisdictional interview. For example, although a lawyer conducting an interview must abide by the no-contact rule in the jurisdictions in which that lawyer is barred, the interview may also be subject to more restrictive no-contact rules in the jurisdiction in which the lawyer is practicing during the course of the interview, which may include the location of either the lawyer or interviewee during the interview.
 
Moreover, many international jurisdictions have similar rules regarding contact with separately represented witnesses. In the U.K., for example, the professional rules governing the conduct of solicitors prohibit them from contacting individuals who are separately represented, except for in exceptional circumstances (e.g., if the solicitor representing the individual is not responding). The possibility of these non-U.S. rules’ applicability to remotely conducted interviews must be considered as well.
 

See the 
Footnotes here
.

COM_a413. Thompson Hine: “OFAC Issues Fact Sheet on Providing Humanitarian Aid to Combat COVID-19 Under Various Sanctions Programs”

(Source:
Thompson Hine, 17 Apr 2020)

 
* Principal Author: David M. Schwartz, Esq., 1-202-263-4170, Thompson Hine
 
On April 16, 2020, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) stated that the United States “is committed to ensuring that humanitarian assistance continues to reach at-risk populations through legitimate and transparent channels as countries across the globe fight the Coronavirus Disease 2019 (COVID-19).” Noting that OFAC’s sanctions programs generally allow exemptions, exceptions and authorizations for providing humanitarian aid and related trade to even comprehensively sanctioned countries, OFAC issued
a
Fact Sheet
highlighting such allowable trade under these sanctions programs. The fact sheet also notes that for the export of personal protective equipment (PPE), all relevant U.S. regulations, guidance and rules should be reviewed, including the temporary rule issued by the Federal Emergency Management Agency (FEMA) on April 10, 2020, which prohibits the export from the United States of five types of PPE without explicit FEMA approval. See Trump and Trade Update of April 9, 2020.
 
The fact sheet provides an up-to-date listing and summary authorizations that allow such humanitarian trade under the Iran, Venezuela, North Korea, Syria, Cuba and Ukraine/Russia-related sanctions programs.
Iran
: For COVID-19 related support, U.S. and non-U.S. persons are allowed to provide certain humanitarian goods (including medicine and medical devices) to Iran under existing exemptions, exceptions and authorizations under OFAC regulations. The fact sheet notes that “most medicine and medical devices, including certain personal protective equipment and other items used for COVID-19- related treatment such as medical gowns, medical eye shields and goggles, surgical gloves, face shields, certain respirators and masks such as N95, N99, and N100 masks, and certain ventilators, already qualify for export and reexport to Iran under general licenses, without the need for further authorization from OFAC.” For other categories of medical devices, OFAC continues its policy of reviewing license applications on a case-by-case basis.
 
Venezuela
: OFAC notes that under existing sanctions toward this country, U.S. persons are not prohibited from engaging in transactions involving Venezuela or its citizens, “provided that the Government of Venezuela, other blocked persons, or proscribed conduct are not involved.” In instances where there may be a nexus to the government, OFAC has broad exemptions and authorizations for the commercial sale and export of agricultural commodities, food, medicine and medical devices to Venezuela.
 
North Korea
: The fact sheet highlights that OFAC generally licenses nongovernmental organizations (NGO) to provide services related to certain humanitarian activities in North Korea: “Such support may include providing items to the civilians of North Korea, to include but not limited to testing kits, respiratory devices, personal protective equipment, and medicine used in the prevention, diagnosis, treatment, and recovery from COVID-19.” Otherwise, OFAC authorizes only limited engagement or transactions directly with the government of North Korea.
 
Syria
: Despite the complexity of sanctions toward Syria (given that concerns regarding Iran, Russia and global terrorism are also involved), OFAC indicates that it is “committed to ensuring that these sanctions do not limit the ability of civilians located in Syria to receive humanitarian support from the international community. Such support may include providing items to the civilians of Syria, to include testing kits, respiratory devices, personal protective equipment, and medicine used in the prevention, diagnosis, treatment, and recovery from COVID-19.” Several general licenses are in place allowing for certain activities to be undertaken by NGOs and for the export of certain non-U.S.-origin food, medicine and medical devices.
 
Cuba
: OFAC acknowledges that most transactions between Cuba and the United States continue to be prohibited, but that general license authorizations to allow for humanitarian relief and assistance are available. This would include certain travel-related authorizations for medical and health-related projects as well as certain categories authorizing monetary remittances. The fact sheet notes that the Department of Commerce also maintains certain regulations and controls pertaining to the export of medicine and medical devices to Cuba.
 
Ukraine/Russia
: The fact sheet states that Russia is involved in “a broad range of malign activities” including activities in Syria, Venezuela and North Korea, as well as ongoing aggression in Ukraine. OFAC notes that U.S. persons are not prohibited from engaging in transactions involving the country or people of Russia, provided that the transactions do not involve the Crimea region of Ukraine, blocked persons, or proscribed conduct. Further, while exports to the Crimea region of Ukraine are blocked, OFAC has issued several general licenses which allow for the export of medicine and medical supplies to this region of Ukraine.
 
The fact sheet provides helpful links to relevant OFAC general and specific licenses, executive orders, and other helpful guidance tools for assistance in providing humanitarian aid to these six countries.

TEEX/IM
MOVERS & SHAKERS

(Source: Events & Jobs Editor)
 
NEW JOB OPENINGS:

* Altran; Bale, Switzerland;
Brand Supply Chain Expert 

 
* Analog Devices, Chelmsford, MA; Trade Compliance Coordinator; Requisition ID: 17757
 
* Argor AI; Pittsburgh, PA; Export Control & Logistics Manager;
 
* ArmorWorks Enterprises, Inc; Chandler, AZ; Contracts Manager-Export Controls
 
* Bio-Rad Laboratories; Irvine, CA; Trade Compliance Manager (Regional – Americas); Requisition ID:2020-12124.1
 
*
Comrise, Boston, MA; Attorney (import/export)
 
* Entrust Datacard; Ottawa, Canada; Mgr Trade Compliance; Requisiton ID: 2000005F
 
* GE Digital; San Ramon, CA; Senior Compliance Counsel; Requisition ID: 3417043
 
 
 
* Kimber Mfg., Inc.; Troy, AL; Compliance Manager
 
* Maritime Jobs; Barrow-in-Furness, UK; Export Control Lead Practitioner; Requisition ID: EMP454071_1587020977
 
* Matchtech; Barrow in Furness, UK; Export Control Lead Practitioner
 
* Morson International; Barrow-in-Furness, UK; Export Controls Lead Practitioner
 
* NVIDIA; Moscow, Russia; Global Trade Compliance Specialist
 
* Outsource UK Limited; Barrow upon Humber, UK; Export Control Lead Practitioner – Project Management
 
* Qualcomm; Singapore, SG; Export Compliance Manager; Requisiton ID: N1981375
 
* PeterSan Group; Washington, D.C.; Assistant General Counsel-Sanctions/OFAC
 
* Sensata Technologies; Thousand Oaks, CA;
Global Trade Compliance Specialist – Export Controls
; Requisition ID: IRC77243
 
* Smith News; London, UK; Senior Manager, International Trade Compliance; Requisitio ID: DETECTIONAPAC00194
 
* Surefire LLC; Fountain Valley, CA;
Regulatory Compliance Administrator
; Contact Details: sgreenberg@surefire.com
 
* Tektronix; Beaverton, OR; Trade Compliance Analyst; Requisition ID: TEK009158; Contact Details: applyassistance@fortive.com
 
*
The Church of Jesus Christ of Latter-day Saints
; Salt Lake City. UT;
Export Compliance Manager
; Requisition ID: 252336; Contact Details:
dan.seeman@churchofjesuschrist.org 
 
* The Timken; Canton, OH; Global Trade & Customs Manager

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

TEEX/IM TRAINING EVENTS & CONFERENCES

(Source:
ECTI)
 
* What: Classifying Aircraft Part Technology
* When: 22 Apr 2020; 1:00 p.m. (EDT)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Scott Gearity
* Register
here or contact Ashleigh Foor, 1-540-433-3977.

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

ENEDITOR’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.

24 Feb 2020:
85 FR 10274
: Amendments to Country Groups for Russia and Yemen Under the Export Administration Regulations.
 

 

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.  26 Dec 2019: 84 FR 70887; 23 Jan 2020: 85 FR 3819: Encryption rule and USML Categories I, II, III, and related sections regarding guns & ammo. 
DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

13 Mar 2020:
85 FR 14572:
General Licenses Issued Pursuant to Venezuela-Related Executive Order 13835.

 
 
 
 
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.
 

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