Exporter Assessed $100,000 Penalty for Unauthorized Exports to Iran

Court prohibits dealing in EAR commodities for 10 years

• The rule removes a requirement that the license holder attach a replacement license issued by BIS to the original license that it replaces. However, the rule retains the requirement that the license holder keep both the original and the replacement licenses.

• The rule exempts parties who submit documents to BIS via SNAP-R from requirements to retain copies of documents so submitted even thought those documents are "export control documents" under the EAR.

• The new rule requires that the following documents are kept: (1) notification from BIS that an application is being returned without action; (2) notification from BIS that an application is being denied; and (3) notification from BIS of the results of a commodity classification or encryption review request conducted by BIS.

1. A single export control list. The United States Munitions List (USML) and Critical Commodities List (CCL) would be replaced by a single list, which would prevent forum shopping where exporters may try classification under one list versus another, duplication, where an item is covered by both USML and CLL, and also aid companies in understanding applicable restrictions.  
2. A single licensing agency. Currently, two different authorities - one at the State Department and another at Commerce - often make independent, unilateral decisions, which sometimes cause for confusion and delay in decision making.
3. A single agency to coordinate enforcement, which would strengthen the ability to identify, investigate and prosecute violations. Currently, multiple enforcement agencies exist, including Immigration and Customs Enforcement (ICE), State enforcement, Commerce Export Enforcement Office, FBI, and many others. It is expected that in the future there will still be multiple enforcement institutions, but their efforts will be coordinated to avoid overlapping jurisdiction and, in some cases, confused authorities.
4. A single unified IT system. Gates stressed that a single IT system instead of the current three would review license application process across the U.S. government and also make this process more efficient. 
   

• Single Control List,
• Single Primary Enforcement Coordination Agency,
• Single IT System, and
• Single Licensing Agency.

• Control List - refine, understand, and harmonize definitions to end jurisdiction confusion between the two lists; establish new independent control criteria to be used to screen items for control into new tiered control list structure.
• Licensing - implement regulatory-based improvements to streamline licensing processes and standardize policy and processes to increase efficiencies.
• Enforcement - synchronize and de-conflict enforcement by creation of an Enforcement Fusion Center.
• IT - determine enterprise-wide needs and begin the process to reduce confusion by creating a single U.S. Government (USG) point of entry for exporters.

• Control List - restructure the two lists into identical tiered structures, apply criteria, remove unilateral controls as appropriate, and submit proposals multilaterally to add or remove controls.
• Licensing - complete transition to mirrored control list system and fully implement licensing harmonization to allow export authorizations within each control tier to achieve a significant license requirement reduction which is compatible with national security equities.
• Enforcement - expand outreach and compliance.
• IT - transition toward a single electronic licensing system.

• Control List - merge the two lists into a single list, and implement systematic process to keep current.
• Licensing - implement single licensing agency.
• Enforcement - consolidate certain enforcement activities into a Primary Enforcement Coordination Agency.
• IT - implement a single, enterprise-wide IT system (both licensing and enforcement).

U.S. Nominates Sandra Bell for WCO Director