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The Daily Bugle Weekly Highlights: Week 2 (11 – 15 Jan 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 8,500 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, Salvatore Di Misa, 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: “Change to the License Review Policy for Unmanned Aerial Systems (UAS) To Reflect Revised United States UAS Export Policy”; Tuesday, 12 Jan 2021; Item #1
  2. UK ECJU Updates Guidance on Open General Export Licences for Technology for Military Goods and for Export of Dual-Use Items After Repair/Replacement Under Warranty; Wednesday, 13 Jan 2021; Item #6 & 7
  3. Commerce/BIS: “Commerce Tightens Controls to Prevent Support of Foreign Military Intelligence and WMD Activities”; Thursday, 14 Jan 2021; Item #5
  4. Commerce/BIS: “Expansion of Certain End-Use and End-User Controls and Controls on Specific Activities of U.S. Persons”; Friday, 15 Jan 2021; Item #2
  5. Treasury/OFAC: “Hong Kong-Related Sanctions Regulations”; Friday, 25 Jan 2021; Item #3

 

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Commerce/BIS: “Change to the License Review Policy for Unmanned Aerial Systems (UAS) To Reflect Revised United States UAS Export Policy” 

(Source: Federal Register) [Excerpts]

 

86 FR 2252: Final Rule

* AGENCY: Bureau of Industry and Security, Commerce.

* ACTION: Final rule.

* SUMMARY: Consistent with President Donald J. Trump’s July 24, 2020 announcement of a change in U.S. policy regarding the export of Unmanned Aerial Systems (UAS), the Bureau of Industry and Security (BIS) is amending the Export Administration Regulations (EAR) licensing review policy with respect to certain UAS that are controlled for Missile Technology (MT) reasons. UAS that have a range and payload capability equal to or greater than 300 kilometers (km)/500 kilograms (kg) are identified on the Missile Technology Control Regime (MTCR) Annex as Category I items. Pursuant to this amendment, BIS will review export and reexport license applications involving UAS that fall within these parameters and a maximum true airspeed of less than 800 km/hour (hr) for export licensing review purposes on a case-by-case basis under the more flexible review policy generally applied to MTCR Category II items under the EAR. BIS will also review MT items for the design, development, production, or use in such UAS on a case-by-case basis. This policy change reflects a reasonable approach to technological change and the protection of the national security and economic interests of the United States, while simultaneously remaining committed to the MTCR and its core nonproliferation objectives.

* DATES: This rule is effective January 12, 2021.

 

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UK ECJU Updates Guidance on Open General Export Licences for Technology for Military Goods and for Export of Dual-Use Items After Repair/Replacement Under Warranty

(Source: UK ECJU and UK ECJU, 12 Jan 2021) [Excerpts]

 

  • Page summary: Licences allowing the export of technology and the information needed for the development, and production of, military goods. See explanation below for which licence to use.
  • Page summary: Licences allowing the export of dual-use items imported into the UK for repair or replacement under warranty. See explanation below for which licence to use.

 

Change made: These OGELs have been revised to take into account changes in legislation following the end of the transition period.  

 

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Commerce/BIS: “Commerce Tightens Controls to Prevent Support of Foreign Military Intelligence and WMD Activities”

(Source: Commerce/BIS, 13 Jan 2021)

 

Today, the Bureau of Industry and Security (BIS) in the Department of Commerce (Commerce) imposed new controls on any U.S. technologies and specific activities of U.S. persons who may be supporting foreign military-intelligence end uses and end users in China, Cuba, Russia, and Venezuela, as well as in terrorist-supporting countries.  BIS is also enhancing controls to prevent U.S. persons from supporting unauthorized weapons of mass destruction (WMD) programs, including weapons delivery systems and production facilities.

“We cannot allow the foreign military-intelligence organizations of our adversaries in China, Cuba, Russia, Venezuela, Iran, and other terrorist-supporting nations to benefit from U.S. technology or U.S. services to support their destabilizing activities,” said Secretary of Commerce Wilbur Ross.  “We must ensure our controls prevent U.S. persons, wherever located, from supporting unauthorized WMD activities around the globe.  Today’s important updates to the U.S. export control system achieve these two goals and enhance our national security.”

The new controls prevent U.S. persons from supporting certain foreign military-intelligence services, such as through brokering the sale of foreign-origin items or providing maintenance, repair, or overhaul services.  BIS is also expanding the license requirement for exports, reexports, and transfers (in-country) to military-intelligence end uses and end users in China, Russia, and Venezuela beyond enumerated items subject to existing military end-use and end-user (MEU) controls to apply to all items subject to the Export Administration Regulations.  These controls will also apply to terrorist-supporting and embargoed countries. 

“These new strict controls will inhibit China’s Intelligence Bureau and Russia’s GRU from leveraging U.S. technology and services to support espionage, intelligence collection and operations, and other activities contrary to U.S. national security interests,” added Ross.

Similarly, BIS is revising end-use controls related to chemical and biological weapons, rocket systems, and unmanned aerial vehicles (UAVs) to ensure that any U.S. activity related to the operation, installation, maintenance, overhaul, repair, or refurbishing of such weapons, rocket systems, or UAVs triggers a catch-all license requirement, as outlined in the EAR.  BIS also is establishing a framework for informing exporters, re-exporters, and transferors of items subject to the EAR that a license is required for specific transactions intended to circumvent Entity List-based license requirements, or for specific foreign parties assisting listed entities in circumventing such license requirements.

Both of these actions, which go into effect March 16, 2021, are directed by the Export Control Reform Act of 2018. 

The foreign military-intelligence organizations impacted by today’s action are:

  • Cuba’s Directorate of Military Intelligence (DIM) and Directorate of Military Counterintelligence (CIM)
  • China’s Intelligence Bureau of the Joint Staff Department
  • Iran’s Islamic Revolutionary Guard Corps Intelligence Organization (IRGC-IO) and Artesh Directorate for Intelligence (J2)
  • North Korea’s Reconnaissance General Bureau (RGB)
  • Russia’s Main Intelligence Directorate (GRU)
  • Syria’s Military Intelligence Service
  • Venezuela’s General Directorate of Military Counterintelligence (DGCIM)

 

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Commerce/BIS: “Expansion of Certain End-Use and End-User Controls and Controls on Specific Activities of U.S. Persons”

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

 

86 FR 4865: Rule

* AGENCY: Bureau of Industry and Security, Commerce.

* ACTION: Interim final rule.

* SUMMARY: The Bureau of Industry and Security (BIS), Department of Commerce, is issuing this interim final rule to implement the provisions of the Export Control Reform Act of 2018 by: imposing additional license requirements under the Export Administration Regulations (EAR) for exports, reexports, and transfers (in-country), as well as specific activities of U.S. persons, in connection with certain military-intelligence end uses and end users; clarifying that license requirements under the EAR for specific activities of U.S. persons apply even when the items at issue are not subject to the EAR; establishing restrictions on transactions intended to circumvent license requirements for listed entities; and expanding the scope of activities subject to chemical and biological weapons and rocket systems and unmanned aerial vehicles end-use controls.

* DATES: Effective date: This rule is effective March 16, 2021. Comment date: Comments must be received by BIS no later than March 1, 2021.

 

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Treasury/OFAC: “Hong Kong-Related Sanctions Regulations”

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

 

86 FR 3793: Rule

* AGENCY: Office of Foreign Assets Control, Treasury.

* ACTION: Final rule.

* SUMMARY: The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is adding regulations to implement a July 14, 2020, Hong Kong-related Executive order. OFAC intends to supplement these regulations with a more comprehensive set of regulations, which may include additional interpretive and definitional guidance, general licenses, and statements of licensing policy.

* DATES: This rule is effective January 15, 2021.

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