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:
- S. District Court Awards $56.4 Million From Sale ofAIRBUS SE Deferred Prosecution Agreement Bond for Violation of Arms Export Control Act; Monday, 23 Nov 2020; Item #4
- UK ECJU: “NTE 2020/16 – UK Exporters Fined for Unlicensed Exports”; Tuesday, 24 Nov 2020; Item #6
- Commerce/BIS: “Emerging Technology Technical Advisory Committee; Notice of Partially Closed Meeting”; Wednesday, 25 Nov 2020; Item #1
- State/DDTC: “DECCS Tips and Tricks Webinar”; Friday, 27 Nov 2020; Item #4
- EU Commission: “Targeted Consultation on Draft EU Compliance Guidance for Research Involving Dual-Use Items”; Friday, 27 Nov 2020; Item #5
U.S. District Court Awards $56.4 Million From Sale of AIRBUS SE Deferred Prosecution Agreement Bond for Violation of Arms Export Control Act
(Source: 466 F.Supp.3d 63, 2020 WL 2896661) [Excerpts]
* Case: UNITED STATES of America, Plaintiff, v. $56,471,329.88 IN PROCEEDS FROM THE SALE OF A BOND BELONGING TO AIRBUS SE, Defendants.
* Citation: 466 F.Supp.3d 63, 2020 WL 2896661; Civil Action No. 20-cv-408
* Dates: Filed 06/03/2020; Decided
* Counsel: Zia Mustafa Faruqui, U.S. Attorney’s Office for the District of Columbia, Washington, DC, for Plaintiff. Defendant’s counsel did not appear.
* Judge: Thomas F. Hogan, Senior District Judge
Background: Government brought civil forfeiture action in rem against defendant property consisting of $56,471,329.88 in proceeds from sale of a bond traceable to violation of Arms Export Control Act. Government moved for entry of default judgment and order of forfeiture.
Holdings: The District Court, Thomas F. Hogan, Senior District Judge, held that:
(1) government satisfied its notice obligations, and
(2) proceeds were subject to civil forfeiture.
Decision: DEFAULT JUDGMENT AND ORDER OF FORFEITURE
This matter comes before the Court upon the Plaintiff’s Motion for Entry of Default Judgment and Order of Forfeiture, as well as the Memorandum of Points and Authorities submitted in support of it. The Court has carefully reviewed the history of this case, which is a civil forfeiture action in rem against defendant property consisting of $56,471,329.88 in proceeds from the sale of a bond belonging to Airbus SE (“Defendant Property”).
The Defendant Property is subject to forfeiture pursuant to 18 U.S.C.§ 981(a)(1)(C), of all right, title, and interest in the Defendant Property, as property, real or personal, constituting or derived from proceeds traceable to a violation of the Arms Export Control Act (“AECA”), 22 U.S.C. § 2778, et seq., and the AECA’s implementing regulations, the International Traffic in Arms Regulations (“ITAR”), 22 C.F.R. § 130.9. . . .
On February 12, 2020, the plaintiff commenced this forfeiture action against the Defendant Property by filing a Verified Complaint for Forfeiture In Rem. See Complaint, ECF 1. Plaintiff identified Airbus SE as the only potential claimant with standing as to the Defendant Property; however, Airbus SE waived the direct notice requirement in its Deferred Prosecution Agreement (“DPA”) and acknowledged that the Defendant Property was subject to forfeiture. SeeDPA, United States v. Airbus SE, No. 1:20-cr-00021 (TFH), 2020 WL 1226425 (D.D.C. Jan. 31, 2020). Such waivers extinguish any ownership interest held in the Defendant Property and any direct notice obligations on the government. See United States v. Assorted Artifacts, 2017 WL 1205086 (E.D. Va. Feb. 21, 2017),report and recommendation adopted, 2017 WL 1199735, (E.D. Va. Mar. 29, 2017) (government not required to send direct notice where it obtained a waiver from the only known interested party); see also United States v. Two AN/PVS-14 Monocular Night Vision Devices, 2018 U.S. Dist. LEXIS 55546 at 3-4 (D.C. Apr. 2, 2018) (“Company 1 provided to the Government a signed Consent and Agreement to Forfeiture, in which Company 1 waived any interest it had in the NVDs.”).
The plaintiff provided notification of this civil forfeiture action by publication pursuant to Rule G(4)(a)(iv) of the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions. On February 14, 2020, the government commenced notification of this forfeiture action on an internet site,http://www.forfeiture.gov, for 30 consecutive days pursuant to the Verified Complaint for Forfeiture In Rem. Thus, any verified claim in response to notice by publication had to be filed not later than April 14, 2020.
No person filed a verified claim, thus, the Clerk of Court determined that the notice requirements were satisfied when it entered default in this matter on May 22, 2020. See Clerk’s Entry of Default, ECF 6. …
Government satisfied its notice obligations in civil forfeiture action in rem against defendant property consisting of proceeds from sale of a bond traceable to violation of Arms Export Control Act, where only potential claimant waived direct notice requirement in its deferred prosecution agreement and acknowledged that property was subject to forfeiture, government commenced notification on government forfeiture website for 30 consecutive days, no person filed verified claim, and time for filing claim had expired. 22 U.S.C.A. § 2778 et seq.; Supplemental Admiralty and Maritime Claims Rules G(4)(a)(iv), G(5)(a)(ii). …
Based on the Government’s well-pleaded allegations of the Complaint and Airbus’s admissions in the DPA, which established prima facie forfeitability of the Defendant Property, the Court finds that the Defendant Property is property that constituted or was derived from proceeds traceable to a violation of AECA, 22 U.S.C. § 2778, et seq., and the AECA’s implementing regulations, ITAR, 22 C.F.R. 130.9. As such, the Defendant Property is subject to forfeiture to the United States, pursuant to 18 U.S.C. § 981(a)(1)(C). The Court finds that the Verified Amended Complaint for Forfeiture In Rem states a factual and legal basis for forfeiture. In addition, the Court also finds that process was fully issued in this action with respect to the Defendant Property and returned according to law. In consequence, no response, answer, or defenses remain interposed and no opposition has been made to the Plaintiff’s Motion for Entry of a Default Judgment and for Order of Forfeiture.
*4 Based upon the foregoing and the entire record in this action, it is by the Court, on this 3rd day of June, 2020, hereby
ORDERED, that Plaintiff’s Motion for Entry of a Default Judgment and Order of Forfeiture is GRANTED; and it is further ORDERED, ADJUDGED, AND DECREED, that the Defendant Property is HEREBY DECLARED FORFEITED TO THE UNITED STATES OF AMERICA, and that title to the Defendant Property is vested in the United States of America; and that no right, title, or interest in the defendant property shall exist in any other person; and it is further ORDERED, that the Clerk of the Court shall forward a certified copy of this Order to USADC.AFMLS2@usdoj.gov.
ORDERED, that the Clerk of the Court may close this matter as fully resolved.
UK ECJU: “NTE 2020/16 – UK Exporters Fined for Unlicensed Exports”
(Source: UK Export Control Joint Unit, 24 Nov 2020)
Between March and September 2020, HM Revenue and Customs (HMRC) received compound settlements totalling £700,368.01. The 19 settlements were between £1,000 and £211,250. These related to unlicensed exports of dual use goods, military goods and related activity controlled by the Export Control Order 2008.
HMRC have policy responsibility for enforcing export controls on strategic goods and sanctions and investigating breaches of those controls. Where appropriate, HMRC can use their powers to offer a compound settlement in lieu of prosecution.
Commerce/BIS: “Emerging Technology Technical Advisory Committee; Notice of Partially Closed Meeting”
(Source: Federal Register) [Excerpts]
85 FR 75296: Notice
The Emerging Technology Technical Advisory Committee (ETTAC) will meet on December 10, 2020, at 1:00 p.m., EST. The meeting will be available via teleconference. The Committee advises the Office of the Assistant Secretary for Export Administration on the identification of emerging and foundational technologies with potential dual-use applications as early as possible in their developmental stages both within the United States and abroad.
- Welcome and Introductions.
- Introduction by the Bureau of Industry and Security Leadership.
- Presentation:Wassenaar Arrangement Export Control Regime.
- Presentation:Missile Technology Export Control Regime.
- Presentation:Nuclear Suppliers Group.
- Presentation:Australia Group.
- Open Discussion.
- (Closed Session) Discussion of matters determined to be exempt from the provisions relating to public meetings found in 5 U.S.C. app. 2 §§10(a)(1) and 10(a)(3).
The open session will be accessible via teleconference to 20 participants on a first come, first serve basis. To join the conference, submit inquiries to Ms. Yvette Springer at Yvette.Springer@bis.doc.gov no later than December 2, 2020.
A limited number of slots will be available for the public session. Reservations are not accepted. To the extent that time permits, members of the public may present oral statements to Start Printed Page 75297the Committee. The public may submit written statements at any time before or after the meeting. However, to facilitate the distribution of public presentation materials to the Committee members, the Committee suggests that presenters forward the public presentation materials prior to the meeting to Ms. Springer via email.
The Assistant Secretary for Administration, with the concurrence of the delegate of the General Counsel, formally determined on November 13, 2020, pursuant to Section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. app. 2 §10(d)), that the portion of the meeting dealing with pre-decisional changes to the Commerce Control List and the U.S. export control policies shall be exempt from the provisions relating to public meetings found in 5 U.S.C. app. 2 §§10(a)(1) and 10(a)(3). The remaining portions of the meeting will be open to the public.
For more information, call Yvette Springer at (202) 482-2813. Yvette Springer,
Committee Liaison Officer.
State/DDTC: “DECCS Tips and Tricks Webinar”
(Source: State/DDTC, 25 Nov 2020)
Please join DDTC’s CIO Karen Wrege and team to discuss the core topics facing DECCS users today. In this session, we will review how DECCS continues to help DDTC and our users meet mission during these challenging times. We will discuss the road ahead for DECCS and how you can get involved to help guide the next round of updates. We will demonstrate tools you can use to find the answers you need when working in the system. And as always, we will leave plenty of time for Q&A.
Topics to be discussed:
* State of the System: System stats and related outcomes
* DECCS Roadmap: Virtual Agent, DECCS User Group, and One Form
* Self-Service Tools demo
Login Details are below:
Date: December 9th, 2020
Time: 2:00 pm – 3:00 pm EST
Important – If password is required when entering WebEx, type ‘Census#01’.
Dial in for audio: 1-888-469-1342
Passcode: 2 1 9 8 4 8 6 #
EU Commission: “Targeted Consultation on Draft EU Compliance Guidance for Research Involving Dual-Use Items”
(Source: European Commission, 27 Nov 2020)
- Policy field: Trade
- Target group: All concerned stakeholders (e.g. academia, research institutions) making research involving dual-use items
- Closing Date: 30/11/2020
Objective of the consultation
Nowadays Europe’s research landscape is ever more competitive. Research organisations have strong incentives to collaborate internationally. Industry-sponsored research and commercial collaborations are sought actively to develop meaningful scientific and technological advancement. As a result, the line between fundamental research and applied research becomes increasingly blurry in practice.
Awareness about dual-use export controls in the wider research community cannot be taken for granted. In the European Union, only few research organisations have a fully-fledged compliance structure established. Most research organisations are only starting to invest in export compliance measures, including the determination of potentially export-controlled research, and seek support from EU and national competent authorities.
At EU level, the need to take into consideration the global nature of science and the free flow of scientific information was recognised in 2016 in the context of the export control policy review (1).
The 2016 Commission proposal for a modernisation of EU export controls (2) explicitly recognises that researchers may be involved in the export of dual-use items and suggests clarification regarding the application of controls to natural persons, such as researchers.
The 2018 public consultation on the draft EU Internal Compliance Programme (ICP) guidance has sparked the attention of some actors in the European academic research community to respond and indicate the need to tailoring compliance guidance to increase its usefulness.
In order to support the research institutions and the national competent authorities in their effort to ensure compliance with EU and national export laws and regulations, the European Commission and EU Member States, represented in the Dual-Use Coordination Group (3), set up a Technical Expert Group which prepared the guidance submitted for targeted consultation as a non-binding instrument identifying the main elements that are essential to help researchers and research organisations to identify, manage and mitigate risks associated with dual-use export controls and to facilitate compliance with the relevant EU and national laws and regulations.
Before finalising the work on this non-binding guidance, which will take the form of a Commission Recommendation, the European Commission and the EU MS have decided to conduct a public survey to evaluate the usefulness of this draft guidance, providing the opportunity for relevant stakeholders to give their feedback and inputs.
The Commission will publish a document after the consultation summarising the findings and how it has taken comments into account.
The Commission will collect the data from the survey and make it available to the experts of the Member States in the Technical Expert Group, with a view to proceeding with the finalisation of the Compliance Guidance as swiftly as possible.
(1) COMMISSION STAFF WORKING DOCUMENT – IMPACT ASSESSMENT – Report on the EU Export Control Policy Review Accompanying the document Proposal for a Regulation of the European Parliament and of the Council setting up a Union regime for the control of exports, transfer, brokering, technical assistance and transit of dual-use item – (SWD(2016)315 final of 28.9.2016) – https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=SWD:2016:0315:FIN
(2) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL setting up a Union regime for the control of exports, transfer, brokering, technical assistance and transit of dual-use items (recast) – https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2016:0616:FIN
(3) Established under Article 23 of Reg. (EC) No 428/2009. The Group is chaired by the Commission and composed by representatives appointed by each Member State.