Archive for 2008

DDTC Announces Streamlined Procedures for Goodrich Control Systems – Rolls Royce J.V.

Wednesday, December 31st, 2008 by Danielle McClellan

Effective December 30, 2008 three Goodrich Control Systems operations in the UK have entered into a joint venture with Rolls-Royce plc. The companies will be renamed, Rolls-Royce Goodrich Engine Controls Systems Ltd. DDTC has waived the requirements for amendments to change currently approved authorizations at this time.

All currently approved agreements will be treated as needing a minor amendment per 22 CFR 124.1(d). Agreement holders are responsible for amending their agreement. The minor amendment must be submitted no later than February 28, 2009.

Pending agreements applications that require amending must bring the change to the assigned Agreements Officer in order for the changes to be made prior to issuance.

Any license applications received after January 31, 2009 which identifies one of the subject Goodrich Control Systems facilities will be RWA. A copy of this website notice must be maintained by the license holder and presented with the relevant license to customs at time of shipment.

More information:

State Department Notice (DOC)

Treasury Department Identifies Countries Enforcing Arab League Boycott of Israel

Wednesday, December 31st, 2008 by Danielle McClellan

The Department of Treasury has issued a list of countries that may or may not require participation in, or cooperation with, an international boycott. The following countries were identified:

  • Kuwait
  • Lebanon
  • Libya
  • Qatar
  • Saudi Arabia
  • Syria
  • United Arab Emirates
  • Yemen, Republic of

It is noted by the Department of Treasury that Iraq is not included on the list but its status for future lists is continually under review.
PRACTICAL IMPACT: Of course, the US Government will never say this is a list of the only countries that might enforce with the Arab boycott of Israel. As a practical matter, US persons should use this as the list of countries where there are most likely to be antiboycott compliance issues under the IRS rules and under the Export Administration Regulations.

More information:

Federal Register, December 31, 2008

Slinging Mud? Boston.com Hints at Hewlett Packard Illegal Exports to Iran

Tuesday, December 30th, 2008 by John Black

A recent article at boston.com put Hewlett-Packard in the spotlight of what it thinks are illegal sales to Iran. The article describes how HP sells its products to Redington Gulf, a third-party distributor, who then sells the products to companies in Iran. Companies who, “have knowledge or reason to know” that their goods are intended for Iran can be charged with administering the sanctions by OFAC. HP claims it has “no knowledge” that Redington Gulf sells its printers to anyone in Iran.

Under the OFAC rules, HP’s actions might be completely legal because the rules allow US exporters to deliver products to a foreign company reseller even if the US company knows the reseller might eventually deliver a portion of its inventory to Iran-delivery of an inventory not substantially intended for Iran does not mean the exporter has “knowledge” under US Iran embargo rules. If an exporter has a shipment that it knows or suspects is specifically (or substantially) destined for Iran, the exporter may not export. In certain cases, the US embargo on Iran does not prohibit foreign-made HP printers with minimal US content to be sold to Iran.

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DDTC Announces Streamlined Policy for Goodrich Control Systems Limited Name Change

Friday, December 19th, 2008 by Danielle McClellan

Effective December 19, 2008, Goodrich Control Systems Limited operations in the UK will be named Goodrich Control Systems. DDTC has waived the requirement for amendments to change the name on currently approved and pending authorizations.

The agreement holder for all approved authorizations are responsible for amending the agreement; the executed amendment will be treated as a minor amendment per 22 CFR 124.1(D) and must be submitted no later than February 19, 2009. Pending agreement applications that require amending should be brought to the attention to the assigned Agreement Officer by the agreement holder and the changes will be made prior to the issuance.

New license applications received after January 31, 2009 must identify Goodrich Control Systems Limited as Goodrich Control systems or the application will be RWA.

A copy of the notice must be maintained by the license holder and presented to Customs at the time of shipment.

More information:

Antiboycott Fines for Syrian Transactions

Sunday, November 16th, 2008 by Danielle McClellan

Rhode & Liesenfeld, Inc. of Texas has been fined $108,000 for thirty-six violations of the Regulations. Between 2002 and 2003 the company engaged in transactions involving the sale and/or transfer of goods and services from the US to Syria. Rhode furnished information concerning business relationships with the boycotted country, an activity prohibited by Section 760.2(d) of the Regulations.

The charging letter does not describe in any detail the information that was disclosed. As long as the company pays the first $30,000 by October 29, 2008, they will not lose their export privileges.

More information:

BIS Order (PDF)

BIS Revises De Minimis Rule

Sunday, November 16th, 2008 by Danielle McClellan

BIS has revised provisions to the EAR pertaining to “de minimis” rules, the calculation for the rules will be amended for foreign produced hardware that is bundled with US origin software. The ruling also clarifies the term “incorporated” and adds language to make clear the de minimis rules.

Foreign produced products are subject to export and reexport controls under the EAR if they contain more than a certain percentage ($ value) of US origin controlled content. Previously US origin software and technology had to be compared against foreign origin software content in the foreign produced item. So, if the US software content was more than 25 percent of the total software in the foreign made item, the item was subject to US jurisdiction, even if the total value of the software as compared to the entire machine in which it is incorporated is less than 25 percent. The new rule is slowly moving away from this “apples-to-apples” comparison requirement by amending Section 734.4 to exclude, in some cases, foreign made commodities “bundled” with de minimis amounts of US origin software from the jurisdiction of the EAR. The “bundling” concept relates to “software that is configured for a specific commodity, but not necessarily physically integrated into the commodity” (i.e. printer software that is not loaded into the printer itself but is shipped on a CD along with the printer). (more…)

DDTC Issues Waiver for Eagle Global Logistics Name Change

Sunday, November 16th, 2008 by Danielle McClellan

DDTC has issued a waiver regarding the name change of Eagle Global Logistics to CEVA Freight LLC. All currently approved and pending authorizations identifying Eagle Global Logistics will not be required to submit an amendment to reflect the name change. A copy of the DDTC notice must be attached to the currently approved license by the license holder.

New license applications received after October 20, 2008 must identify Eagle Global Logistics as CEVA Freight LLC or the license will be RWA for correction of the new name.

A copy of the website notice must be maintained by the license holder and presented with the relevant license to customs at time of shipment.

More information:

DDTC Notice: Eagle Global Logistics to CEVA Freight LLC (Word doc)

BIS to Offer Option of Publishing Product Classifications

Sunday, November 16th, 2008 by Danielle McClellan

BIS is going to allow companies to have the opportunity to have their Commodity Classification information made accessible via the BIS website. “This information will improve procedural transparency in the licensing process help exporters comply with export compliance,” BIS explains.

Anyone who has or plans to have Commodity Classification information or an export control point of contact available on your company’s website and would like this information to be accessible via the BIS website please contact CommodityClassification [at] bis.doc.gov with the following information:

  • Company name
  • General description of the products/services
  • Commodity classification information website address
  • Export control point of contact

More information:

Announcement on BIS Website

More EEI and AES Clarification for Shipments to Puerto Rico

Sunday, November 16th, 2008 by Danielle McClellan

Last month we reported that the Census Bureau announced that Puerto Rico is within the US Customs territory and shipments between Puerto Rico and the US are exempt from the new advance filing deadlines set forth in the new Foreign Trade Regulations (FTR). Beginning September 30, 2008 it will be mandatory that Electronic Export Information (EEI) be filed through AES in advance, 24 hours before shipment via vessel or 2 hours via air.

The Census Bureau has now released a clarification to the exemption, when shipping any items between the US and Puerto Rico proof of the EEI filing citation, post departure filing citation or exemption must be presented to the carrier prior to the departure of goods. The filing does not have to be in advance, but it must be filed.

Remember however, most carriers want this information earlier than the time frames that have been set. Most carriers have a “no docs, no load” policy, meaning they must have the ITN number or an exemption listed on the transport document or your shipment will not be loaded. All ITN formats and exemption formats must meet the new criteria set forth in the Jun 9, 2008 Federal Register.

More information:

DDTC: “Our ‘Company Visits’ Are Not Audits”

Sunday, November 16th, 2008 by Danielle McClellan

DDTC has posted FAQ’s regarding the “Company Visit Program” (CVP) on its website. CVP involves DDTC officials visiting US companies registered with DDTC as manufacturers, exporters, or brokers. The visit is not intended to be an audit but DDTC will be, “exercising its responsibility under record keeping requirements detailed in Section 122.5(b) of the ITAR.”

The visit is supposed to be a learning tool to provide information on how companies comply with the laws and regulations and how DDTC can better do its job as regulator thereof. The four main purposes of the CVP are as follows:

  1. Learn how companies have established defense trade control programs
  2. Understand how those programs are implemented and comply with the AECA and ITAR
  3. Gather information for DDTC to determine whether or not they are exercising regulatory responsibility in licensing and compliance
  4. Use the information gathered from visits to adjust or revise the regulations and practices accordingly (more…)