The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) recently released a new set of best practices that are aimed at helping exporters, re-exporters and freight forwarders guard against the diversion of dual use items shipped to a transshipment hub. While transshipments are a growing part of international trade and offer many benefits, they can be used illegally to either disguise the final destination or divert trade to unauthorized end users.
The new set of best practices encourages exporters to maintain strong internal compliance strategies, conduct focused outreach, and continuously raise awareness of export control regulations and obligations.
The following is a summary of the best practices published by BIS:
- Companies should pay attention to the Red Flag Indicators on the BIS website.
- Companies should seek to utilize Trade Facilitators that administer sound export management and compliance practices.
- Companies should “know” their foreign customers – by obtaining detailed information to measure the risk of diversion.
- Companies should avoid routed transactions when exporting and facilitating the movement of dual-use items.
- When the Destination Control Statement (DCS) is required, companies should provide the appropriate Export Control Classification Number (ECCN) and the final destination where the item(s) are intended to be used.
- Companies should provide the ECCN or the EAR99 classification to freight forwards, and should report this information in AES.
- Companies should use information technology to the maximum extent feasible to augment “know your customer” and other due-diligence measures.
For more detailed information, please read the full article.
Updates have been made to US Export Controls. The Bureau of Industry and Security (BIS) is publishing this final rule to amend the Export Administration Regulations (EAR) to implement the understandings reached at the September 2009 plenary meeting of the Australia Group (AG). This rule also amends the EAR to implement a decision recommended at the 2009 AG Plenary that was adopted under the AG intersessional silent approval procedures in October 2009. BIS also published a final rule in the Federal Register on Friday, December 11, 2009, that revised the EAR by amending entries for certain items that are controlled for national security reasons in Categories 1, 2, 3, 4, 5 Part I (telecommunications), 5 Part II (information security), 6, 7, 8, and 9; adding new entries to the Commerce Control List, revising reporting requirements, and adding and amending EAR definitions. That final rule contained errors that affected Export Control Classification Numbers 1A004 and 5A001. This document corrects these errors. The following Categories are affected: 1 and 2.
US Export Controls have been updated. The Bureau of Industry and Security (BIS) is publishing a final rule to amend the Export Administration Regulations (EAR) by revising the controls on select agents identified in Export Control Classification Number (ECCN) 1C360 on the Commerce Control List (CCL). These changes reflect amendments that the U.S. Department of Agriculture’s Animal Plant and Health Inspection Service (APHIS) recently made to the Plant Protection and Quarantine Programs (PPQ) list of select agents and toxins.
The Bureau of Industry and Security (BIS) is hosting a two-day program that provides an in-depth examination of the EAR. Co-hosted by the Federation of International Trade Administration (FITA), the program will cover the information exporters need to know to comply with U.S. export control requirements on commercial goods. They will focus on what items and activities are subject to the EAR, steps to take to determine the export licensing requirements, how to determine your export control classification number (ECCN), when you can export or reexport without applying for a license, export clearance procedures and record keeping requirements, an overview of the Export Compliance Management Program (ECMP) concepts, and real life examples in applying this information. Click here for more information.
US Export Controls Update
The Bureau of Industry and Security (BIS) maintains the Commerce Control List (CCL), which identifies items subject to Department of Commerce export controls. The Export Administration Regulations (EAR) has been revised to implement changes made to the Wassenaar Arrangement’s List of Dual Use Goods and Technologies (Wassenaar List). This list is maintained and agreed to by governments participating in the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual Use Goods and Technologies (Wassenaar Arrangement, or WA). The arrangement advocates implementation of effective export controls on strategic items with the objective of improving regional and international security and stability. To harmonize with the changes to the Wassenaar List, this rule revises the EAR by amending certain entries that are controlled for national security reasons in Categories 1, 2, 3, 4, 5 Part I (telecommunications), 5 Part II (information security), 6, 7, 8, and 9. New entries to the CCL have been added, reporting requirements have been revised, and EAR definitions have been added and amended. The following categories are affected: 1, 2, 3, 4, 5, 6, 7, 8, and 9.
BIS Reaches Settlement Agreement with Hailin Lin for Export Violations
The Bureau of Industry and Security has published its settlement agreement with Hailin Lin, which resolves allegations that she committed 124 violations of U.S. Export Administration Regulations by failing to obtain the proper export licenses, and/or providing false descriptions, and/or withholding required information on the invoices provided to shippers, for certain electronic shipments to China. Lin was assessed a $1.364 million fine (which would be waived if no further violations occur in a one year period) and prohibited from engaging in certain export activities for a 15-year period.
New import certificate requirements have been established for certain products. The following HTS chapters are affected: 28, 48, 51, 52, 54, 55, 60, 61, 62, 65, 84, and 87.
The Tariff Rate Quota has been updated. The following chapters are affected: 15, 29, 53, and 72.
The Tariff Rate Quota available for the second half of 2009 has been updated. This quota applies to the Dominican Republic, United States, Canada, Panama, Chile, and WTO member countries. Several products are affected, as well as the following HTS chapters: 02, 04, 07, 10, 11, 12, 15, 16, 17, 20, 21, 22, and 23.
The Export Administration Regulations (EAR) have been amended to reflect changes to the Missile Technology Control Regime (MTCR) Annex. These changes were accepted by MTCR member countries at the November 2008 Plenary in Canberra, Australia. This rule also clarifies certain EAR controls to properly reflect the intent of changes to items that were accepted by MTCR members at past Plenary meetings. The following ECN categories are affected: 1, 2, 6, and 7.