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.
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Last week’s highlights of The Daily Bugle included in this edition are:
- EU Council: “Myanmar/Burma – EU Sanctions 11 People Over the Recent Military Coup and Ensuing Repression”; Monday, 22 Mar 2021; Item #7
- UK DIT: “Crown Exemption for Controlled Military List Equipment and Technology Owned by the UK MOD”; Monday, 22 Mar 2021; Item #8
- DHS/CBP: Generalized System of Preferences (GSP); Tuesday, 23 Mar 2021; Item #5
- UK ECJU: “Notice to Exporters 2021/02 – Exporting Military or Dual-use Technology”; Wednesday, 24 Mar 2021; Item #5
- Treasury/OFAC: Settlement Agreement Between the U.S. Department of the Treasury’s Office of Foreign Assets Control and Nordgas S.r.l.; Friday, 26 Mar 2021; Item #8
EU Council: “Myanmar/Burma – EU Sanctions 11 People Over the Recent Military Coup and Ensuing Repression”
(Source: Council of the European Union, 22 Mar 2021)
The Council today imposed restrictive measures on eleven individuals responsible for the military coup staged in Myanmar/Burma on 1 February 2021, and the subsequent military and police repression against peaceful demonstrators.
Ten of the eleven persons targeted belong to the highest ranks of the Myanmar Armed Forces (Tatmadaw), including the Tatmadaw’s Commander-in-Chief, Min Aung Hlaing, and Deputy-Commander-in-Chief, Soe Win. The other is the new Chairperson of the Union Election Commission for his role in cancelling the results of the 2020 elections in Myanmar.
The restrictive measures introduced today include a travel ban and an asset freeze. The travel ban impedes those listed from entering or transiting through EU territory, while the asset freeze covers the funds or economic resources in the EU of the listed persons. In addition, EU citizens and companies are forbidden from making funds available to the listed individuals and entities.
Today’s sanctions, together with the withholding of financial assistance going to the government, the freezing of all assistance to government bodies that may be seen as legitimising the Myanmar military junta, and intense, ongoing diplomatic outreach, represent the EU’s robust response to the illegitimate over-throwing of the democratically-elected government and the brutal repression by the junta against peaceful protesters. The EU will continue to review all of its policy options, including additional restrictive measures against economic entities owned or controlled by the military in Myanmar/Burma. At the same time, the EU aims to ensure that its measures do not have an adverse effect on the general population. The EU remains a steadfast supporter of the Myanmar/Burmese people and of the country’s democratic transition.
Pre-existing EU restrictive measures also remain in place. These include an embargo on arms and equipment that can be used for internal repression, an export ban of dual-use goods for use by the military and border guard police, export restrictions on equipment for monitoring communications that could be used for internal repression, and a prohibition on military training to and military cooperation with the Tatmadaw. Measures also include the designation of 14 persons for atrocities against the Rohingya population. Combined with the new designations, this brings the total number of listed persons to 25.
UK DIT: “Crown Exemption for Controlled Military List Equipment and Technology Owned by the UK MOD”
(Source: UK Dept for International Trade, 19 Mar 2021) [Excerpts]
Export Control and MoD contact email addresses updated.
This guidance provides a brief overview about Crown exemption in respect of the transfers of export-controlled military list goods, technology or software owned by the UK Ministry of Defence (MOD). It applies to exporters engaged by the MOD, including UK armed forces, to export on their behalf military list goods, technology or software.
Other government departments have their own arrangements for Crown exemption.
Crown exemption does not apply to the transfer from the United Kingdom of any goods, technology or software controlled under the EU dual use regulation.
Crown exemption does not apply to the transfer from the United Kingdom of any goods, technology or software owned privately by commercial entities. …
Official letter granting crown exemption
Where the Crown owns the controlled military goods, technology or software being exported, and has similar rights over disposal, then an exporter acting on the Crown’s behalf may carry out the export without a licence. This Crown Exemption for MOD UK/UK Armed Forces-owned goods, technology or software is subject to the issuing of an approval letter by the MOD team in the Export Control Joint Unit (ECJU).
Export Control Joint Unit – Ministry of Defence team
Department for International Trade
3 Whitehall Place
London, SW1A 2AW
Telephone: 020 7218 9821 Email: ECJU-MODTeam@mod.uk
Only approval letters issued by the MOD team in the ECJU constitute formal approval to export military goods, technology or software on behalf of the MOD under Crown exemption. Her Majesty’s Revenue and Customs (HMRC) formally recognise these letters as authorisation of Crown exemption.
Letters of approval issued by any other MOD entity than the MOD team in ECJU are not valid and will constitute non-compliance.
- MOD team in the ECJU: telephone 020 7218 9821, email: ECJU-MODTeam@mod.gov.uk
- DIT ECO Helpline: telephone 020 7215 4594, email: firstname.lastname@example.org
DHS/CBP: Generalized System of Preferences (GSP)
(Source: CBP 22 Mar 2021)
Expired on December 31, 2020 – Pending Congressional renewal
GSP is the largest and oldest U.S. trade preference program that provides nonreciprocal, duty-free treatment enabling many of the world’s developing countries to spur diversity and economic growth through trade. Economic development is promoted by eliminating duties on thousands of products when imported from designated beneficiary countries and territories. Authorized by the Trade Act of 1974 and implemented on January 1, 1976, GSP is a preferential trade legislation that is subject to Congressional re-authorization.
Goods that are either wholly the growth, product, or manufacture of, or is a new or different article of commerce that has been grown, produced, or manufactured in, a beneficiary developing country may qualify for duty-free entry under GSP. All third-country materials must have undergone a substantial transformation with at least 35 percent of the good’s appraised value be added in the beneficiary country. The good must also be “imported directly” from the GSP eligible country. For additional eligibility criteria, see 19 CFR 10.171 to 10.178 at https://www.ecfr.gov/cgi-bin/text-idx?SID=31017316ea7c410ae832bd10ed56f584&mc=true&node=sg19.1.10_1153.sg31&rgn=div7 .
GSP Special Program Indicator (SPI): “A,” “A+,” and “A*”
Eligible tariff items are identified by the symbols “A”, “A*” or “A+” in the “Special” sub-column of the HTSUS. Entries claiming GSP benefits must add SPI “A” as prefix to the tariff number.
- The symbol “A” indicates that all GSP countries are eligible (HTSUS General Note 4(a))
- The symbol “A*” indicates that certain GSP countries are ineligible (HTSUS General Note 4(d))
- The symbol “A+” indicates approximately 1,500 additional tariff items for which only the least developed beneficiary developing countries are eligible (HTSUS General Note 4(b))
Competitive Need Limitations
The GSP program imposes quantitative ceilings called Competitive Need Limitations (CNLs) on GSP benefits for all tariff items and beneficiary developing countries. Under certain circumstances, these ceilings may be waived. For more information, see USTR’s GSP Guidebook at https://ustr.gov/sites/default/files/gsp/GSPGuidebook_0.pdf .
Expiration of GSP SPI “A,” “A+,” and “A*”
On December 31, 2020, the GSP SPIs (“A,” “A+,” and “A*”) expired and is currently pending Congressional action to pass legislation for the program’s renewal. Effective January 1, 2021 at 12:00am EST, GSP eligible goods entered or withdrawn from warehouse need to pay “General” (column 1) duty rates until further notice.
GSP Entry Summaries and Retroactive Refund
Importers are encouraged to continue flagging GSP-eligible importations with SPI “A” and pay normal trade relations (column 1) duty rates during the lapse. Importers may not file SPI “A” without paying duties. In the event that GSP is renewed with a retroactive refund clause, CBP will be enabled to automate the duty refund process for entries flagged with the SPI “A” and no further action will be required by the filer to initiate the refund process.
Post Summary Correction (PSC) GSP Claims for Importations prior to Expiration
CBP will continue to allow post-importation GSP claims made via PSC and protest (19 USC 1514, 19 CFR 174) for importations made prior to GSP expiration.
CBP will not allow post-importation GSP claims made via PSC or protest for importations made after GSP expiration.
Goods Subject to Section 232 (aluminum and steel)
Trade preference may be claimed for all preference programs with the exception of GSP and the African Growth and Opportunity Act (AGOA). Importers making a trade preference claim under a program other than GSP or AGOA may continue to receive the preferential duty rate and any manufacturing processing fee exemption that may apply in accordance with 19 CFR 24.23(c). GSP and AGOA-eligible goods that are subject to Section 232 duties or quotas may not receive GSP or AGOA duty preference in accordance with 19 USC 2463(b)(2). Section 232 duties must be paid on imports subject to Section 232 even if trade preferences apply.
UK ECJU: “Notice to Exporters 2021/02 – Exporting Military or Dual-use Technology”
(Source: UK ECJU, 24 Mar 2021)
Updated guidance on definition and scope of controlled technology in relation to strategic export control legislation.
Treasury/OFAC: Settlement Agreement Between the U.S. Department of the Treasury’s Office of Foreign Assets Control and Nordgas S.r.l.
(Source: Treasury) 26 Mar 2021 [Excerpts]
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced a settlement with Nordgas, S.r.l., a company located in Italy that produces and sells components for gas boiler systems and applications. Nordgas, S.r.l. agreed to remit $950,000 to settle its potential civil liability for apparent violations of the Iranian Transactions and Sanctions Regulations.
Over an approximately four-year period, Nordgas knowingly reexported 27 shipments of air pressure switches procured from a U.S. company intended for as many as ten customers in Iran and caused a U.S. company to indirectly export its goods to Iran. In doing so, Nordgas obfuscated the reexportation and Iranian customers from the U.S. company. In view of the individual facts of this case, as well as Nordgas’s financial circumstances, its cooperation with OFAC, and its agreement to implement enhanced compliance commitments, $650,000 of the settlement amount will be suspended pending satisfactory completion of Nordgas’s compliance commitments. . . .