|
|
Greetings!
We hope you've had a great summer! August's import/export highlights include: BIS posts new "Best Practices" guidance on transshipments; Open PECSEA meeting in September in Miami announced; New Executive Order re: Syria issued; Recent OFAC enforcement actions detailed; an Iranian national is sentenced to 4 years imprisonment for export violations; a Singapore national agrees to pay $100,000 fine and 25 year export denial order; DDTC posts new Dual & Third Country National guidance; CBP will discontinue paper liquidation notices; and CBP revises Customs Bonds forms 301 & 301A. As always, thank you for reading! Jennifer Kessinger, Tammie Krauskopf
& Ruta Riley
globaltradeexpertise
info@globaltradeexpertise.com
|
|
|
BIS Publishes New "Best Practices" for Industry to Guard Against Unlawful Diversion by Transshipments
On August 31, 2011, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) published a new "best practices" guide for to help guard against the diversion of dual-use items shipped to a transshipment "hub," or to any intermediate country before being shipped to the country of ultimate destination. BIS states that these best practices were developed in conjunction with U.S. industry.
In the announcement, BIS stated:
Transshipment is a routine and growing part of legitimate world trade with logistical benefits, but also can be used illegally to disguise the actual country of ultimate destination. Transshipment practices may also create a risk that items are diverted to unauthorized end-users or end-uses.
"These new best practices provide a formidable tool to help secure trade through transshipment hubs," said Assistant Secretary for Export Administration Kevin J. Wolf. "BIS is committed to working with industry to adopt best practices critical to safeguarding U.S. national security interests."
The following new best practices will help exporters, re-exporters, freight forwarders and other parties to comply with US export control regulations and laws and augment BIS's Export Management and Compliance Guidelines. BIS is encouraging industry to:
- Pay heightened attention to BIS's Red Flag Indicators and communicate red flag concerns internally.
- Seek to utilize only those trade facilitators and freight forwarders that administer sound export control management and compliance programs that include transshipment trade best practices.
- Obtain detailed information on the credentials of foreign customers to assess diversion risk.
- For routed transactions, establish and maintain a trusted relationship with parties to mitigate risks.
- Communicate export control classification and destination information to end-users and consignees on government and commercial export documentation.
- Provide the ECCN or the EAR99 classification to freight forwarders for all export transactions and report the classifications in the Automated Export System (AES), if applicable.
- Use information technology to the maximum extent feasible to augment "know your customer" and other due-diligence measures in combating the threats of diversion and increase confidence that shipments will reach authorized end-users for authorized end-uses.
This set of best practices, aimed at U.S industry, supports one of ten best practices suggested by the State Department's Bureau of International Security and Nonproliferation to foreign governments at the Global Transshipment Seminar in Dubai, United Arab Emirates, in March 2011. That best practice suggestion encouraged industry to develop stronger internal compliance programs, conduct focused outreach, and raise awareness of export control obligations.
The 2011 "Best Practices for Preventing Unlawful Diversion of U.S. Dual-Use Items Subject to the Export Administration Regulations, Particularly through Transshipment Trade" are posted on the BIS website.
|
| Notice of Open Meeting of PECSEA
Meeting will take place on 9/19 - 9/20 in Miami, FL
On August 24, 2011, the U.S. Department of Commerce's Bureau of Industry and Security (BIS) announced that the President's Export Council Subcommittee on Export Administration (PECSEA) will meet on September 19 and 20, 2011, 10 a.m., at the Sofitel Hotel Miami, 5800 Blue Lagoon Drive, Miami, Florida 33126.
The PECSEA provides advice on matters pertinent to those portions of the Export Administration Act, as amended, that deal with United States policies of encouraging trade with all countries with which the United States has diplomatic or trading relations and of controlling trade for national security and foreign policy reasons.
BIS states that, "A limited number of seats will be available for the public sessions on both days. Reservations are not accepted. To the extent time permits, members of the public may present oral statements to the PECSEA. Written statements may be submitted at any time before or after the meeting. However, to facilitate distribution of public presentation materials to PECSEA members, the PECSEA suggests that public presentation materials or comments be forwarded before the meeting to Ms. Yvette Springer at Yvette.Springer@bis.doc.gov."
The published agenda is as follows:
Monday, September 19
Open Session
1. Export Control Reform Field Hearing.
Tuesday, September 20
Open Session
1. Welcome and Remarks by the Chairman and Vice Chair.
2. Export Control Reform Update.
3. Presentation of Papers or Comments by the Public.
4. Review of Field Hearing.
5. Status of 2011 Workplan.
6. Discussion of 2012 Workplan.
7. Subcommittee Breakout Sessions.
|
|
New Executive Order Blocks Property of the Government of Syria and Prohibits Certain Transactions With Respect to Syria
On August 18, 2011, in response to the Syrian Government's continuing escalation of violence against the people of Syria, President Obama signed Executive Order 13582 (E.O.) that imposed additional sanctions against the government of Syria.
The E.O. blocks all Government of Syria's assets that are within the U.S. or within the control of any U.S. person, including any overseas branches. In addition, the E.O. prohibits:
(1) new investment in Syria by a U.S. person;
(2) exports, reexports, sales, or provisions of direct or indirect services to Syria from the U.S., or by a U.S. person, wherever located;
(3) imports into the U.S. of petroleum or petroleum products of Syrian origin;
(4) any dealing by a U.S. person related to petroleum or petroleum products of Syrian origin; and (5) any approval, financial facilitation, or guarantee by a U.S. person of transactions by a foreign person where the transaction would be prohibited to a U.S. person.
These sanctions are in addition to the national emergency declared in E.O. 13338 of May 11, 2004 (as amended), which blocks property of certain persons and prohibits the export of certain goods to Syria.
|
|
Recent OFAC Enforcement Actions
 On August 16, 2011, Office of Foreign Assets Control (OFAC) posted on its web site information on recent OFAC enforcement actions:
Norton Lilly International (Norton), Mobile, AL, has been assessed a penalty of $18,750 for its violation of the Iranian Transactions Regulations that occurred in November 2006. Norton engaged in a transaction or dealing related to services of Iranian origin, and facilitated a transaction by a foreign person involving Iranian-origin services. In the transaction, Norton acted as a paying agent for a foreign entity, to pay port charges incurred at an Iranian port in the amount of $14,936. OFAC determined that Norton did not voluntarily self-disclose the violation to OFAC and that the violation constituted a non- egregious case.
The base penalty amount for the violation was $25,000. The assessed penalty reflects OFAC's consideration that Norton had knowledge or reason to know that the conduct, activity, or transaction giving rise to the violation involved port charges with respect to a ship calling in Iran; Norton did not have a compliance program in place at the time of the violation; Norton has instituted remedial measures by adopting procedures to comply with OFAC's regulations in the future; Norton cooperated with OFAC by promptly responding to OFAC's administrative subpoena and providing OFAC all relevant information regarding the violation; and Norton has not been subject to an OFAC enforcement action in the five years preceding the date of the violation.
CMA CGM (America) LLC (CCA), of Norfolk, VA, has remitted $374,400 to settle allegations of violations of the Cuban Assets Control Regulations, the Iranian Transactions Regulations, and the Sudanese Sanctions Regulations, occurring between December 2004 and April 2008. OFAC alleged that CCA, a global container shipping company, facilitated the exportation of goods from foreign ports to Sudan on at least two occasions and, in 28 separate transactions, accepted payments for shipping services provided by its foreign parent company, CMA CGM, or its foreign affiliates, in connection with shipments between third countries and Cuba, Iran, or Sudan. The transactions involving the alleged violations were valued at approximately $402,265.
OFAC determined that CCA did not voluntarily self-disclose the matter to OFAC and that the alleged violations constituted a non-egregious case. The base penalty amount for the alleged violations totaled $640,000. The settlement amount reflects OFAC's consideration of the following: the alleged violations appear to have resulted from a pattern of conduct over a period of approximately three years; given the size and scope of CCA's operations and the nature of its international business, it appears to have lacked an adequate compliance program to avoid U.S. sanctions violations; some of the goods exported from third countries to Cuba and Iran may have qualified as agricultural/medical products under the Trade Sanctions Reform and Export Enhancement Act of 2000 and, thus, may have been eligible for a license; CCA and CMA CGM have undertaken remediation to ensure that such alleged violations do not recur; CCA had not been the subject of OFAC penalties within the past five years; and CCA cooperated with OFAC throughout the investigation, including by requesting the cooperation of CMA CGM and its foreign affiliates in gathering relevant transaction data, and by agreeing to toll the statute of limitations.
Société Générale New York Branch, New York, NY (SGNY) has remitted $111,359 to settle allegations of violations of the Iranian Transactions Regulations (Regulations) occurring December 27, 2006, and May 9, 2007. OFAC alleged that SGNY dealt in Iranian-origin services and/or facilitated transactions by a foreign person where the transactions by the foreign person would have been prohibited by the Regulations if performed by a U.S. person. Specifically, OFAC alleged that SGNY, as the issuing bank of two letters of credit between two non-sanctioned parties, processed two payments under those letters of credit involving the shipment of cargo transported aboard vessels owned and/or managed by the Islamic Republic of Iran Shipping Lines of Tehran, Iran, an Iranian entity. The value of the payments was $329,954.
SGNY voluntarily self-disclosed the alleged violations and OFAC has determined that the alleged violations constituted a non-egregious case. The base penalty amount for the alleged violations was $164,977. The settlement amount reflects OFAC's consideration of the following: SGNY improved its compliance program in response to the apparent violations by enhancing its internal controls related to screening trade finance transactions, and provided additional training to staff involved in processing such transactions; SGNY cooperated with OFAC's investigation and resolution of this matter; and OFAC has not issued a penalty notice or Finding of Violation against SGNY in the five years preceding the transactions at issue.
Heritage Turbines, Inc., Hyannis, MA (Heritage) has remitted $4,500 to settle an alleged violation of the Sudanese Sanctions Regulations occurring on or about November 21, 2007. OFAC alleged that Heritage attempted to ship two fuel nozzle kits to Sudan without an OFAC license. The fuel nozzle kits were valued at a total of $2,000. OFAC determined that Heritage did not voluntarily self-disclose this matter to OFAC and the alleged violation constituted a non-egregious case. The base penalty amount for the alleged violation totaled $10,000. The settlement amount reflects the fact that Heritage had no history of sanctions violations and cooperated with OFAC's investigation of this matter.
|
|
Iranian National Sentenced to Four Years in Prison for Conspiracy to Illegally Export Prohibited Parts to Iran
On August 15, 2011, U.S. Department of Justice (DOJ) announced that Davoud Baniameri, 38, an Iranian national who maintained a residence and business in California was sentenced to 51 months in federal prison after he pleaded guilty in May to one count of conspiracy to export goods and technology to Iran without a license from the U.S. Department of Treasury in violation of the International Emergency Economic Powers Act (IEEPA) and one count of attempting to export defense articles on the U.S. Munitions List from the United States without a license or approval from the U.S. Department of State in violation of the Arms Export Control Act (AECA).
Baniameri was arrested on a criminal complaint on Sept. 9, 2009, and indicted in December 2009. A superseding indictment in July 2010 charged Baniameri and his two co-defendants Syed Majid Mousavi (Mousavi) and Andro Telemi (Telemi).
According to the plea agreement, sometime before October 10, 2008, Mousavi, based in Iran, contacted Baniameri in California and requested that he purchase and export radio test sets from the United States to Iran, through Dubai. Baniameri agreed and over the next few months negotiated the purchase of three Marconi radio test sets from a company in Illinois. Baniameri arranged for the radio test kits to be sent to him in California, where he shipped them to Dubai, for ultimate transshipment to Iran, without the required export license.
The plea agreement also states that, sometime before August 10, 2009, Mousavi contacted Baniameri and requested that he purchase and export to Iran via Dubai 10 connector adapters for the TOW and TOW2 missile systems. Baniameri agreed to purchase the items on behalf of Mousavi, and over the next few months, he admitted that he and his co-defendants attempted to purchase 10 connector adaptors from a company in Illinois, which unbeknownst to them, was in fact a company controlled by law enforcement. In September 2009, Baniameri admitted that he directed Telemi to take possession of the connector adaptors in California after having paid $9,450 to a representative of the Illinois company. To further facilitate the export of these items to Iran, Baniameri arranged to fly from the United States to Dubai and then from Dubai to Iran. Baniameri did not attempt to obtain a license from the U.S. government for the export of the connector adaptors. He was arrested before leaving the United States.
|
|
Singapore National Agrees to $100,000 Fine and 25-year Denial Order to Settle Export Conspiracy Charges
 On August 10, 2011, Bureau of Industry and Security (BIS) announced that Jianwei Ding of Singapore has agreed to pay a $100,000 civil penalty and have his export privileges denied for a period of 25 years, to settle allegations that he conspired to violate the Export Administration Regulations (EAR) by knowingly and willfully attempting to export carbon fiber to China for use by the China Academy of Space Technology (CAST) without the required export licenses.
The carbon fiber at issue is controlled by BIS for nuclear non-proliferation and national security reasons and was valued at approximately $315,000. According to BIS, from February 2007 through April 2008, Ding conspired with others to export two types of the carbon fiber to CAST in China, via Hong Kong and Singapore, without the required Department of Commerce license.
BIS alleges that BIS used his position as a manager of several Singapore-based companies to acquired items for CAST. In addition, He directed the activities of individuals and entities in the United States and Singapore to deceive U.S. suppliers and avoid detection by law enforcement, and provided the money used to obtain the controlled materials for export from the U.S. to China.
Ding received repeated warnings that an export license was required for the export of carbon fiber to China. After the material had been purchased and stored in New York as part of the scheme, Ding ultimately directed a co-conspirator by email to export some carbon fiber to Hong Kong and some to a company under Ding's control in Singapore.
The items were stopped by Special Agents of BIS's Office of Export Enforcement (OEE) before they could be exported. Ding subsequently was arrested when he attempted to enter the U.S. and is now incarcerated in a federal prison. Prior to settling BIS's administrative charge, Ding entered a guilty plea to criminal charges of conspiracy to violate the EAR and was sentenced to a period of 46 months imprisonment.
|
|
DDTC Posts New Dual and Third Country National Guidance
The U.S. Department of State's Directorate of Defense Trade Controls (DDTC) posted updated Guidelines for Implementing New Dual National/Third-Country National Policy for Agreements. On its website, DDTC states:
The following guidance relates to the August 15, 2011 implementation of the new §126.18 rule on dual and third country nationals. The first document relates to the changes to agreements and will be incorporated into the new Guidelines as well. D-TCN AG Guidance Final.
The following notional implementation plan is a suggested approach, but is by no means the only way of complying with the rule and its core principle of preventing diversion of defense articles to unauthorized end-users and end-uses. Consistent with local national laws and programs for the control/protection of defense articles/technologies and consistent with the need for private entities to protect proprietary data, technology security plans should be designed with a comprehensive and individualized approach to securing sensitive data of all kinds with appropriate measures for physical security and personnel clearances. D-TCN Policy Implementation Final.
Additional guidance and clarification is provided in the attached Frequently Asked Questions relating to both of the above documents. D-TCN FAQs Final.
|
|
CBP Will Discontinue Mailing Paper Liquidation Notices to ABI Filers
 On August 17, 2011, Customs and Border Protection (CBP) issued a final rule in the Federal Register amending Title 19 of the Code of Federal Regulations (CFR) pertaining to the method by which U.S. Customs and Border Protection (CBP) issues courtesy notices of liquidation to importers of record whose entry summaries are filed in the Automated Broker Interface (ABI).
Currently, CBP provides an electronic courtesy notice to the ABI filers and a paper courtesy notice to the importer of record. In an effort to streamline the notification process and reduce printing and mailing costs, CBP will discontinue mailing paper courtesy notices of liquidation. Effective September 17, 2011, all ABI filers (importers of records and brokers that file as the agent of an importer of record) will receive electronic courtesy notices. In addition, all importers of record with an Automated Commercial Environment (ACE) Secure Data Portal Account can monitor the liquidation of their entries by using the reporting tool and the ACE Secure Data Portal Account. Importers of record whose entries are not filed through ABI will continue to receive paper courtesy notices of liquidation.
|
|
CBP Revises Customs Bond Forms 301 and 301A
Effective August 16, 2011, CBP announced that the new CBP Forms 301 (Customs Bond) and 301A (Addendum to CBP Form 301) are available via the "Forms" link on the Customs and Border Patrol's (CBP) website.
Until January 1, 2012, the previous version of the CBP Form 301 (with an expiration date of 12/31/2010) or the revised CBP Form 301 (expiration date 3/31/2014) will be accepted by the CBP. Beginning January 1, 2012, CBP will only accept the revised version of the CBP Forms 301 and 301A (with an expiration date of 3/31/2014).
|
Calendar of Events
Upcoming Trade Events & Seminars
 Our website has a comprehensive listing of import and export conferences held throughout the country, as well as Customs training, EAR training, ITAR training, and other training. Below is a small sampling of what's available in the coming months:
Complying with U.S. Export Controls - Bureau of Industry and Security
September 13 - 14, 2011 - Smithfield, RI - $330
How to Develop an Export Management and Compliance Program - Bureau of Industry and Security
September 21-22, 2011 - Santa Clara, CA - $497.50
6th National Forum on International Technology Transfers & Deemed Export Compliance - American Conference Institute (ACI)
September 26 - 27, 2011 - Washington, DC
Basic ITAR Course- Federal Publications Seminars
October 24, 2011 - Arlington, VA
3rd International Forum on China Trade Compliance - American Conference Institute (ACI)
October 24 - 25, 2011 - San Francisco, CA
Advanced ITAR Workshop- Federal Publications Seminars
October 25, 2011 - Arlington, VA
ITAR Compliance: Disclosure and Audits - Federal Publications Seminars
October 26-27, 2011 - Arlington, VA
ITAR Boot Camp - American Conference Institute (ACI)
October 26 - 27, 2011 - Chicago, IL
|
|
Who's Hiring?
A Summary of Current Trade Job Opportunities
 As a service to the international trade community, Global Trade Expertise compiles links to trade job opportunities from many different sources. New trade job listings are posted frequently on our website.
To sort the job opportunities by region, fields, or levels, click on the appropriate category or tag in the right column on our Trade Jobs webpage. |
|
|
|
|
|
Thanks again for your interest in our newsletter!
Sincerely,
|
Jennifer Kessinger, Tammie Krauskopf & Ruta Riley
Attorneys & Consultants
jk@globaltradeexpertise.com
Tel. 925.876.1381 (Jennifer Kessinger)
tk@globaltradeexpertise.com
Tel. 708.707.4087 (Tammie Krauskopf)
rr@globaltradexpertise.com
Tel. (630) 862-8123
www.globaltradeexpertise.com
|  |
|
|
