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:
- DHS/CBP: “Additional 45-day Compliance Period for Executive Order 13936 – Hong Kong Normalization”; Monday, 24 Aug 2020; Item #6
- EU Commission: “Joint Statement of the United States and the European Union on a Tariff Agreement”; Tuesday, 25 Aug 2020; Item #6
- Commerce/BIS: “Commerce Department Adds 24 Chinese Companies to the Entity List for Helping Build Military Islands in the South China Sea”; Wednesday, 26 Aug 2020; Item #2
- Commerce/BIS: “Identification and Review of Controls for Certain Foundational Technologies”; Thursday, 27 Aug 2020; Item #2
- Commerce/BIS Requests Comments on Import, End-User, Delivery Verification Certificates and Firearms Entry Clearance Requirements; Thursday, 27 Aug 2020; Item #3
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DHS/CBP: “Additional 45-day Compliance Period for Executive Order 13936 – Hong Kong Normalization”
(Source: DHS/CBP, 21 Aug 2020)
This notice is to inform the trade that the 45-day transition period for compliance with the President’s Executive Order (EO) on Hong Kong Normalization has been extended for an additional 45 days through November 9, 2020. Additionally, this notice updates the guidance provided in CSMS# 43633412, issued August 11, 2020.
BACKGROUND
On July 14, 2020, the President issued Executive Order 13936 dealing with Hong Kong Normalization, and suspended, among other things, the application of section 201(a) of the United States-Hong Kong Policy Act of 1992 to certain statutes, including 19 U.S.C. 1304. On August 11, 2020, CBP issued a notice in the Federal Register (85 FR 48551) notifying the public that, unless excepted from marking, goods produced in Hong Kong must be marked to indicate that their origin is “China” for purposes of 19 U.S.C. 1304. The position set forth in the notice became applicable as of July 29, 2020; however, CBP granted a transition period until September 25, 2020 for importers to implement marking consistent with the notice.
ADDITIONAL 45 DAYS FOR INFORMED COMPLIANCE
In an effort to allow importers ample time to comply with EO requirements for goods produced in Hong Kong to be appropriately marked with the origin of “China”, CBP is extending the transition period for an additional 45 days, through November 9, 2020. During this period, CBP personnel from the Ports of Entry and Centers of Excellence and Expertise (Centers) should not take any enforcement actions (i.e., marking notices, marking penalties, etc.) on goods produced in Hong Kong for purposes of 19 U.S.C. 1304. Centers and Ports of Entry should take measures to inform accounts and importers of these new marking rules for Hong Kong set forth in the EO.
This change in marking requirements does not affect country of origin determinations for purposes of assessing ordinary duties under Chapters 1-97 of the HTSUS or temporary or additional duties under Chapter 99 of the HTSUS. Entry summary procedures also have not changed. Given that this new rule only applies to marking requirements under 19 U.S.C. 1304, filers should continue to file their entry summaries and submit payments for applicable duties, taxes and fees in accordance with current regulations and policies.
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EU Commission: “Joint Statement of the United States and the European Union on a Tariff Agreement”
(Source: European Commission, 21 Aug 2020)
United States Trade Representative Robert Lighthizer and European Union Trade Commissioner Phil Hogan today announced agreement on a package of tariff reductions that will increase market access for hundreds of millions of dollars in U.S. and EU exports. These tariff reductions are the first U.S.-EU negotiated reductions in duties in more than two decades.
Under the agreement, the EU will eliminate tariffs on imports of U.S. live and frozen lobster products. U.S. exports of these products to the EU were over $111 million in 2017. The EU will eliminate these tariffs on a Most Favored Nation (MFN) basis, retroactive to begin August 1, 2020. The EU tariffs will be eliminated for a period of five years and the European Commission will promptly initiate procedures aimed at making the tariff changes permanent.
The United States will reduce by 50% its tariff rates on certain products exported by the EU worth an average annual trade value of $160 million, including certain prepared meals, certain crystal glassware, surface preparations, propellant powders, cigarette lighters and lighter parts. The U.S. tariff reductions will also be made on an MFN basis and retroactive to begin August 1, 2020.
“As part of improving EU-US relations, this mutually beneficial agreement will bring positive results to the economies of both the United States and the European Union. We intend for this package of tariff reductions to mark just the beginning of a process that will lead to additional agreements that create more free, fair, and reciprocal transatlantic trade” said Ambassador Lighthizer and Commissioner Hogan.
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Commerce/BIS: “Commerce Department Adds 24 Chinese Companies to the Entity List for Helping Build Military Islands in the South China Sea”
(Source: Commerce/BIS, 26 Aug 2020) [Excerpts]
The Bureau of Industry and Security (BIS) in the Department of Commerce (Commerce) added 24 Chinese companies to the Entity List for their role in helping the Chinese military construct and militarize the internationally condemned artificial islands in the South China Sea. Despite protests from the United States and other countries, the government of the People’s Republic of China (PRC) has been rapidly building the artificial islands since 2013, enabling the Communist Chinese Party’s (CCP) militarization of disputed outposts in the South China Sea to undermine the sovereign rights of U.S. partners in the region.
“The United States, China’s neighbors, and the international community have rebuked the CCP’s sovereignty claims to the South China Sea and have condemned the building of artificial islands for the Chinese military,” said Commerce Secretary Wilbur Ross. “The entities designated today have played a significant role in China’s provocative construction of these artificial islands and must be held accountable.”
Since 2013, the CCP has dredged and constructed more than 3,000 acres across seven features in the South China Sea, which include air defense and anti-ship missile features. In addition, the PRC’s dredging and construction of certain outposts violates the sovereign rights of the Republic of the Philippines, as determined by the Permanent Court of Arbitration in its July 2016 award in a case brought by the Philippines against the PRC. In the Entity List additions, Commerce determined these entities enabled China to construct and militarize disputed outposts in the South China Sea.
The Entity List is a tool utilized by BIS to restrict the export, re-export, and transfer (in-country) of items subject to the Export Administration Regulations (EAR) to persons (individuals, organizations, companies) reasonably believed to be involved, or to pose a significant risk of becoming involved, in activities contrary to the national security or foreign policy interests of the United States. Additional license requirements apply to exports, re-exports, and transfers (in-country) of items subject to the EAR to listed entities, and the availability of most license exceptions is limited.
These companies were placed on the Entity List for enabling the People’s Republic of China to reclaim and militarize disputed outposts in the South China Sea. …
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Commerce/BIS: “Identification and Review of Controls for Certain Foundational Technologies”
(Source: Federal Register, 27 Aug 2020) [Excerpts]
85 FR 52934: Proposed Rule
* AGENCY: Bureau of Industry and Security, Commerce.
* ACTION: Advance notice of proposed rulemaking (ANPRM).
* SUMMARY: The Bureau of Industry and Security (BIS) controls the export, reexport, and transfer (in-country) of dual-use and certain military items through the Export Administration Regulations (EAR), including the Commerce Control List (CCL). Many items (commodities, software, and technology) subject to the jurisdiction of the EAR are listed on the CCL. Pursuant to the Export Control Reform Act of 2018, BIS and its interagency partners are engaged in a process to identify emerging and foundational technologies that are essential to the national security of the United States. Foundational technologies essential to the national security are those that may warrant stricter controls if a present or potential application or capability of that technology poses a national security threat to the United States. In order to determine if technologies are foundational, BIS will evaluate specific items, including items currently subject only to anti-terrorism (AT) controls on the CCL or those designated as EAR99. This ANPRM seeks public comment on the definition of, and criteria for, identifying foundational technologies. Comments on this ANPRM will help inform the interagency process to identify and describe such foundational technologies.
* DATES: Submit comments on or before October 26, 2020.
* ADDRESSES: You may submit comments through either of the following:
Federal eRulemaking Portal: http://www.regulations.gov. The identification number for this rulemaking is BIS-2020-0029.
Address: By mail or delivery to Regulatory Policy Division, Bureau of Industry and Security, U.S. Department of Commerce, Room 2099B, 14th Street and Pennsylvania Avenue NW, Washington, DC 20230. Refer to RIN 0694-AH80.
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Commerce/BIS Requests Comments on Import, End-User, Delivery Verification Certificates and Firearms Entry Clearance Requirements
(Source: Federal Register, 27 Aug 2020) [Excerpts]
85 FR 52949: Notice
* AGENCY: Bureau of Industry and Security, Commerce.
* ACTION: Notice of Information Collection, request for comment.
* SUMMARY: The Department of Commerce, in accordance with the Paperwork Reduction Act of 1995 (PRA), invites the general public and other Federal agencies to comment on proposed, and continuing information collections, which helps us assess the impact of our information collection requirements and minimize the public’s reporting burden. The purpose of this notice is to allow for 60 days of public comment preceding submission of the collection to OMB.
* DATES: To ensure consideration, comments regarding this proposed information collection must be received on or before October 26, 2020.
* ADDRESSES: Interested persons are invited to submit comments by email to Mark Crace, IC Liaison, Bureau of Industry and Security, at mark.crace@bis.doc.gov or to PRAcomments@doc.gov. Please reference OMB Control Number 0694-0093 in the subject line of your comments. Do not submit Confidential Business Information or otherwise sensitive or protected information.
* FOR FURTHER INFORMATION CONTACT: Requests for additional information or specific questions related to collection activities should be directed to Mark Crace, IC Liaison, Bureau of Industry and Security, phone 202-482-8093, or by email at mark.crace@bis.doc.gov.