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 7,500 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 Alexander Witt.
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Last week’s highlights of The Daily Bugle included in this edition are:
- DOJ/ATF: Rules of Practice in Explosives License and Permit Proceedings; The Daily Bugle; Monday, 25 November; Item #1.
- Treasury/OFAC Announces $466,912 Settlement with Apple Inc.; The Daily Bugle; Monday, 25 November 2019; Item #6.
- EU Parliament Briefing: “Review of Dual-Use Export Controls”; The Daily Bugle; Tuesday 26 November 2019; Item #6.
- Treasury/OFAC Issues New and Amended Iran-related Frequently Asked Questions; The Daily Bugle; Thursday, 27 November 2019; Item #6.
- Commerce Proposes Rule for Securing the Nation’s Information and Communications Technology and Services Supply Chain; The Daily Bugle, Friday, 29 November 2019; Item #2.
1. DOJ/ATF: Rules of Practice in Explosives License and Permit Proceedings
(Source: Federal Register, 25 Nov 2018.) [Excerpts.]
84 FR 64740-64754: Rules of Practice in Explosives License and Permit Proceedings(2007R-5P); Revisions Reflecting Changes Consistent with the Homeland Security Act of 2002
* Agency: Bureau of Alcohol, Tobacco, Firearms, and Explosives,
Department of Justice.
* ACTION: Final rule.
* SUMMARY: The Department of Justice is amending the regulations of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) concerning procedures and practices in connection with denials of initial applications, denials of renewals, and revocations of explosives licenses or permits. These regulations are being codified in a new part entitled, “Rules and Practice in License and Permit Proceedings.” These regulations are based upon the regulations that ATF relied upon prior to its transfer from the Department of the Treasury to the Department of Justice. This final rule makes minor revisions to regulations governing administrative proceedings related to the denial, suspension, or revocation of a license, and the imposition of a civil fine under Federal firearms law to reference regulations under ATF authority. These revisions remove all references to statutes, regulations, positions, and other terms that are applicable only to the Department of the Treasury. These revisions reflect ATF’s position as a regulatory and enforcement agency under the Department of Justice and are consistent with the regulations governing administrative hearing processes for explosives licenses and permits.
* DATES: This rule is effective December 26, 2019.
* FOR FURTHER INFORMATION CONTACT: Denise Brown, Enforcement Programs and Services, Office of Regulatory Affairs, Bureau of Alcohol, Tobacco, Firearms, and Explosives, U.S. Department of Justice, 99 New York Avenue NE, Washington, DC 20226; telephone: (202) 648-7070. . . .
* Dated: November 5, 2019. William P. Barr, Attorney General.
2. Treasury/OFAC Announces $466,912 Settlement with Apple Inc.
(Source: Treasury/OFAC, 25 Nov 2019.)
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today announced a $466,912 settlement with Apple, Inc. (“Apple”). Apple, a corporation based in Cupertino, California, has agreed to settle its potential civil liability for apparent violations of the Foreign Narcotics Kingpin Sanctions Regulations, 31 C.F.R. part 598 (FNKSR). Apple appears to have violated § 598.203 of the FNKSR by dealing in the property or interests in property of SIS, d.o.o. (“SIS”), a Slovenian software company previously identified on OFAC’s List of Specially Designated Nationals and Blocked Persons as a significant foreign narcotics trafficker. Specifically, from on or about February 24, 2015 to on or about May 9, 2017, Apple hosted, sold, and facilitated the transfer of SIS’s software applications and associated content. OFAC determined that Apple voluntarily disclosed the apparent violations, and that the apparent violations constitute a non-egregious case.
For more information, please visit the following web notice.
For more information on this specific action, please visit this page.
3. EU Parliament Briefing: “Review of Dual-Use Export Controls”
(Source: European Parliament, 26 Nov 2019)
Certain goods and technologies have legitimate civilian applications but can also be used for military purposes; so-called ‘dual-use’ goods are subject to the European Union’s export control regime. The regime is now being revised, mainly to take account of significant technological developments and to create a more level playing field among EU Member States.
The proposed regulation would recast the regulation in force since 2009. Among other elements, the proposal seeks to introduce an ‘autonomous’ EU list for cyber-surveillance technology featuring items that are not (yet) subject to multilateral export control. Moreover, the proposal seeks to introduce human rights violations as an explicit justification for export control.
Stakeholders are divided over the incorporation of human rights considerations, with the technology industry particularly concerned that it might lose out to non-European competitors. On 17 January 2018, based on the INTA committee’s report on the legislative proposal, the European Parliament adopted its position for trilogue negotiations. For its part, the Council adopted its negotiating mandate on 5 June 2019, and on the basis of this mandate, the Council Presidency began negotiations with the European Parliament’s delegation on 21 October 2019. …
4. Treasury/OFAC Issues New and Amended Iran-related Frequently Asked Questions
(Source: Treasury/OFAC, 27 Nov 2019.)
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is updating existing FAQ 303 (Which insurance, reinsurance, or underwriting activities are potentially subject to sanctions under IFCA’s section 1246(a)(1)?) and FAQ 804 (Do sanctions on COSCO Shipping Tanker (Dalian) Co. and COSCO Shipping Tanker (Dalian) Seaman & Ship Management Co. apply to their corporate parent and affiliates?) and is publishing three new Iran-related FAQs.
5. Commerce Proposes Rule for Securing the Nation’s Information and Communications Technology and Services Supply Chain
(Source: Commerce, 27 Nov 2019.)
Today, the U.S. Department of Commerce issued a notice of proposed rulemaking and requested comment on the implementation of Executive Order 13873, Securing the Information and Communications Technology and Services (ICTS) Supply Chain. The proposed rule sets out the procedures the Secretary of Commerce plans to use to identify, assess, and address ICTS transactions that pose an undue risk to ICTS in the United States, to the critical infrastructure or the digital economy in the United States, or an unacceptable risk to national security or to the security and safety of U.S. persons. The public will have a 30-day period to submit comments.
“These actions will safeguard the Information and Communications Technology Supply Chain,” said Secretary of Commerce Wilbur Ross. “These rules demonstrate our commitment to securing the digital economy, while also delivering on President Trump’s commitment to our digital infrastructure.”
The President issued EO 13873 on May 15, 2019 pursuant to statutory authorities, including the International Emergency Economic Powers Act and the National Emergencies Act, in light of the finding that foreign adversaries are increasingly exploiting ICTS to commit cyber actions, including economic and industrial espionage against the United States. The EO gives the Secretary of Commerce, in consultation with other relevant Federal agencies, authority to prohibit or mitigate transactions initiated, pending, or completed after May 15, 2019, that involve ICTS designed, developed, manufactured, or supplied by persons owned by, controlled by, or subject to the jurisdiction or direction of a foreign adversary, if such transactions pose: an undue risk of sabotage or subversion of ICTS in the United States; an undue risk of catastrophic effects on the security and resiliency of critical infrastructure or the digital economy in the United States; or an unacceptable risk to national security or to the security and safety of U.S. persons.
The Secretary has chosen to adopt a case-by-case, fact-specific approach to determine which transactions must be prohibited, or which can be mitigated, according to the requirements in the Executive Order. The Secretary will use assessments developed by the Secretary of Homeland Security and the Director of National Intelligence pursuant to the Executive Order, among other things, to inform his evaluation of ICTS transactions.
While Executive Order 13873 empowers the Secretary immediately to prohibit or mitigate ICTS transactions that pose the risks identified in the Executive Order, the proposed rule sets forth procedures the Secretary will follow, except in instances where the risk of public harm or national security interests require a deviation from such procedures. Under the proposed rule, if the Secretary makes a preliminary determination, in consultation with other Federal agencies, to prohibit or mitigate a transaction, the Secretary will provide notice to the parties engaged in the transaction. Notified parties will have an opportunity to submit a position, which may include proposed measures for mitigation, prior to any final determination issued by the Secretary. The Secretary will provide an unclassified, written final determination provided to the parties that, to the extent possible, explains how the decision is consistent with the terms of the Executive Order, and, as appropriate, a summary of the final determination will also be made publicly available.
Request for Comment
The Department invites comment on all aspects of the proposed rule, but notes that the determination of “foreign adversaries” for the purpose of the Executive Order is solely within the Secretary’s discretion. Any non-public oral presentation to Department officials will be considered an ex parte presentation, and a summary of the meeting will be placed in the public record of this docket. Federal departments and agencies are not subject to the ex parte procedures.
All comments must be submitted by one of the following methods:
- By the Federal eRulemaking Portal: http://www.regulations.gov at docket number DOC-2019-0005.
- By email directly to: ICTsupplychain@doc.gov. Include “RIN 0605-AA51” in the subject line.
- By mail or hand delivery to: Henry Young, U.S. Department of Commerce, ATTN: RIN 0605-AA51, 1401 Constitution Avenue, N.W., Washington, DC 20230.
Comments sent by any other method, to any other address or individual, or received after the end of the comment period, may not be considered. For those seeking to submit confidential business information (CBI), please submit such information by email, mail, or hand delivery as instructed above. Each CBI submission must also contain a summary of the CBI in sufficient detail to permit a reasonable understanding of the substance of the information for public consumption. This summary information will be posted on regulations.gov.