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The Daily Bugle Weekly Highlights: Week 11 (15 – 19 Mar 2021)

Every Monday we post the highlights out of last week’s FCC Export/Import Daily Update (“The Daily Bugle”). Send out every business day to approximately 9,500 readers of changes to defense and high-tech trade laws and regulations, The Daily Bugle is a free daily newsletter from Full Circle Compliance, edited by James E. Bartlett III and Elina Tsapouri.

We check the following sources daily: Federal Register, Congressional Record, Commerce/AES, Commerce/BIS, DHS/CBP, DOE/NRC, DOJ/ATF, DoD/DSS, DoD/DTSA, FAR/DFARS, State/DDTC, Treasury/OFAC, White House, and similar websites of Australia, Canada, U.K., and other countries and international organizations.  Due to space limitations, we do not post Arms Sales notifications, Denied Party listings, or Customs AD/CVD items. To subscribe, click here.

Last week’s highlights of The Daily Bugle included in this edition are:

  1. Commerce/BIS: “Risks in the Semiconductor Manufacturing and Advanced Packaging Supply Chain”; Monday, 15 Mar 2021; Item #1
  2. DHS/CBP: “GUIDANCE – Section 301 China Duties Extension of Product Exclusions”; Tuesday, 15 Mar 2021; Item #4
  3. Treasury/OFAC to Amend Regs to Increase Civil Penalties; Tuesday, 16 Mar 2021; Item #7
  4. Commerce/BIS: “Russia – Implementation of Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (CBW Act) Sanctions”; Thursday, 18 Mar 2021; Item #1
  5. State Dept: “International Traffic in Arms Regulations Amended to Add Russia to Sec. 126.1”; Thursday, 18 Mar 2021; Item #3

 

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Commerce/BIS: “Risks in the Semiconductor Manufacturing and Advanced Packaging Supply Chain”

(Source: Federal Register, 15 Mar 2021) [Excerpts]

 

86 FR 14308: Notice

* AGENCY: Bureau of Industry and Security, Office of Technology Evaluation, U.S. Department of Commerce.

* ACTION: Notice of request for public comments.

* SUMMARY: On February 24, 2021, President Biden issued an Executive order on “America’s Supply Chains,” which directs several Federal agency actions to secure and strengthen America’s supply chains. One of these directions is for the Secretary of Commerce (the Secretary) to submit, within 100 days, a report to the President identifying risks in the semiconductor manufacturing and advanced packaging supply chains, and proposing policy recommendations to address these risks. Additionally, the National Defense Authorization Act of 2021 (FY21 NDAA) includes a title for, “Creating Helpful Incentives to Produce Semiconductors for America” that mandates several Federal actions in securing the semiconductor-related supply chain. One of these requirements is for the Secretary to assess the capabilities of the U.S. microelectronics industrial base to support the national defense, in light of the global nature and interdependence of the supply chain with respect to manufacture, design, and end use. This notice requests comments and information from the public to assist the Department of Commerce (Commerce) in preparing the report required by the Executive order. After that report is completed, Commerce will assess whether additional information will be needed to conduct the assessment required by the FY21 NDAA.

* DATES: The due date for filing comments is April 5 2021.

 

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DHS/CBP: “GUIDANCE – Section 301 China Duties Extension of Product Exclusions”

(Source: DHS/CBP, 15 Mar 2021) [Excerpts] 

 

The purpose of this message is to provide guidance regarding the extension of product exclusions from additional Section 301 China duties on certain medical-care products to address COVID-19.

BACKGROUND

On March 10, 2021, the USTR published 86 FR 13785, extending the 99 product exclusions that were granted or extended by 85 FR 85831 to address ongoing efforts to combat COVID-19.  

The product exclusions that were initially set to expire on March 31, 2021 will be extended through September 30, 2021.  

The exclusions listed are available for any product that meets the description as set out in the Annexes to 85 FR 85831, regardless of whether the importer filed an exclusion request.  Further, the scope of each exclusion is governed by the scope of the 10-digit HTS headings and product descriptions provided in the Annexes to 85 FR 85831, not by the product descriptions set out in any particular request for exclusion.  

The functionality for the acceptance of the extended product exclusions will be available in the Automated Commercial Environment (ACE) as of 7 am eastern standard time, March 16, 2021.

GUIDANCE

Instructions for importers, brokers, and filers on submitting entries to CBP containing granted exclusions by the USTR from the Section 301 measures are set out below:

  • Per 85 FR 85831 Annex A, in addition to reporting the regular Chapters 84, 85, and 90 classifications of the HTS for the imported merchandise, importers shall report the HTS classification 9903.88.62 (Articles, the product of China related to Tranche 1 – $34B Action, as provided for in U.S. note 20(ooo) to this subchapter, each covered by an exclusion granted by the USTR for imported merchandise subject to the exclusion).  
  • Per 85 FR 85831 Annex B, in addition to reporting the regular Chapters 39, 84, and 90 classifications of the HTS for the imported merchandise, importers shall report the HTS classification 9903.88.63 (Articles, the product of China related to Tranche 2 – $16B Action, as provided for in U.S. note 20(ppp) to this subchapter, each covered by an exclusion granted by the USTR for imported merchandise subject to the exclusion).  
  • Per 85 FR 85831 Annex C, in addition to reporting the regular Chapters 28, 34, 38, 39, 40, 48, 56, 65, 84, 85, and 90 classifications of the HTS for the imported merchandise, importers shall report the HTS classification 9903.88.64 (Articles, the product of China related to Tranche 3 – $200B Action, as provided for in U.S. note 20(qqq) to this subchapter, each covered by an exclusion granted by the USTR for imported merchandise subject to the exclusion).  
  • Per 85 FR 85831 Annex D, in addition to reporting the regular Chapters 34, 39, 40, 48, 52, 55, 61, 62, 63, and 90 classifications of the HTS for the imported merchandise, importers shall report the HTS classification 9903.88.65 (Articles, the product of China related to Tranche 4A – $300B Action, as provided for in U.S. note 20(rrr) to this subchapter, each covered by an exclusion granted by the USTR for imported merchandise subject to the exclusion).  
  • Importers shall not submit the corresponding Chapter 99 HTS number for the Section 301 duties when HTS 9903.88.62, 9903.88.63, 9903.88.64, or 9903.88.65 are submitted. …

 

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Treasury/OFAC to Amend Regs to Increase Civil Penalties

(Source: Treasury/OFAC)

 

The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is amending its regulations to implement for 2021 the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.  This regulatory amendment adjusts for inflation the maximum amount of the civil monetary penalties that may be assessed under relevant OFAC regulations.  This regulatory amendment is currently available for public inspection with the Federal Register and will take effect upon publication in the Federal Register on Wednesday, March 17, 2021.

 

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Commerce/BIS: “Russia – Implementation of Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (CBW Act) Sanctions”

(Source: Federal Register, 18 Mar 2021) [Excerpts]

 

86 FR 14689: Rule

* AGENCY: Bureau of Industry and Security, Commerce.

* ACTION: Notification of implementation.

* SUMMARY: The Secretary of State, acting under authority delegated pursuant to Executive Order 12851, has determined pursuant to the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991 (CBW Act) that the Government of the Russian Federation has used chemical or biological weapons in violation of international law or lethal chemical or biological weapons against its own nationals. The sanctions imposed on Russia in connection with this determination include a prohibition, subject to partial waiver, on the export to Russia of national security-controlled goods and technology subject to the Export Administration Regulations (EAR). Pursuant to the EAR, BIS already maintains controls on exports and reexports to Russia of national security-controlled “items” (commodities, software and technology) that are subject to the EAR. This document informs the public that, consistent with BIS’s implementation of the CBW Act sanctions, certain license exceptions will be suspended for use with national security-controlled items destined for Russia, and most license applications for exports or reexports of national security-controlled items destined for Russia will be reviewed under a presumption of denial.

* DATES: March 18, 2021.

 

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State Dept: “International Traffic in Arms Regulations Amended to Add Russia to Sec. 126.1”

(Source: Federal Register, 18 Mar 2021) [Excerpts]

86 FR 14802: Rule
* AGENCY: Department of State.
* ACTION: Final rule.
* SUMMARY: The Department of State is amending the International Traffic in Arms Regulations (ITAR) to include Russia in the list of enumerated countries with respect to which it is the policy of the United States to deny licenses and other approvals for exports and/or imports of defense articles and defense services, except as otherwise provided. This action reflects a policy determination made by the Secretary of State.
* DATES: The rule is effective on March 18, 2021.
   . . . .
Section 126.1 is amended by revising the second sentence in paragraph (a), revising the table in paragraph (d)(2), and adding paragraph (l) to read as follows:
 
§ 126.1 Prohibited exports, imports, and sales to or from certain countries.  
* * * * *  
(a) * * * The exemptions provided in this subchapter, except §§ 123.17, 126.4(a)(1) or (3) and (b)(1), and 126.4(a)(2) or (b)(2) when the export is destined for Russia and in support of government space cooperation, and § 126.6, or when the recipient is a U.S. government department or agency, do not apply with respect to defense articles or defense services originating in or for export to any proscribed countries, areas, or persons.
* * *  
(d) * * *  
    (2) * * *
* * * * *  
(l) Russia. It is the policy of the United States to deny licenses or other approvals for exports of defense articles and defense services destined for Russia, except that a license or other approval may be issued, on a case-by-case basis:  
    (1) For government space cooperation; and  
    (2) Prior to September 1, 2021, for commercial space launches.
* * * * *

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