The Bureau of Industry and Security last week charged a Montana resident and his two companies with violating U.S. export controls after BIS said he tried to ship controlled items knowing they would be used in Iran. Kenneth Scott and his companies, Scott Communication and Mission Communications, also made false or misleading statements to agents, failed to file Electronic Export Information and didn’t maintain the required export records, BIS said.
Ian Cohen
Ian Cohen, Deputy Managing Editor, is a reporter with Export Compliance Daily and its sister publications International Trade Today and Trade Law Daily, where he covers export controls, sanctions and international trade issues. He previously worked as a local government reporter in South Florida. Ian graduated with a journalism degree from the University of Florida in 2017 and lives in Washington, D.C. He joined the staff of Warren Communications News in 2019.
U.S. sanctions and export controls are having a “severe” impact on Russia even though Moscow has continued its war in Ukraine, said Erik Woodhouse, a senior sanctions official with the State Department. Woodhouse said the U.S. is hoping the restrictions eventually force Russia to reverse course and expects the impacts to grow over time.
The U.S. should create a new multilateral export control regime to counter China’s unfair industrial policies and misuse of sensitive technologies, said Mark Dallas, an associate professor at Union College in New York and a fellow with the Council on Foreign Relations. A new regime would create a “unified, clear and multilateral voice” around export controls and would reduce “commercial tensions” between the U.S. and its allies through better information sharing and enforcement.
The Los Angeles and Long Beach ports again postponed by a week a new surcharge meant to incentivize the movement of dwelling containers (see 2110280031), the two ports announced June 10. The ports had planned to begin imposing the fee in November 2021 but have postponed it each week since. The latest extension delays the effective date until June 17.
Amid the rapid pace of Russia-related sanctions and export controls, regulators around the world are sometimes struggling or unwilling to provide timely and clear answers to industry questions about the trade restrictions, lawyers said. The issue is especially problematic in Europe, they said, where sanctions guidance may differ among the 27 EU member states and U.K. general licenses can be delayed or unhelpful.
Lawyers are continuing to see an uptick in outreaches by the Committee on Foreign Investment in the U.S. related to non-notified deals, especially if they involve Chinese investors. Carl Valenstein, a CFIUS lawyer with Morgan Lewis, said some of his clients in the life sciences sector, even though they weren’t working with critical technologies, have recently been contacted by CFIUS.
The Federal Maritime Commission this week approved a $2 million settlement agreement with Hapag-Lloyd for alleged shipping violations involving the company’s detention and demurrage practices. Hapag-Lloyd also agreed to take several steps to improve its billing practices, including posting an updated tariff policy to its website, conducting a “training session” on the FMC’s detention and demurrage rule for all employees involved in billing, and publishing on its website a “complete list of locations that it has authorized to accept empty Hapag-Lloyd containers.”
The Bureau of Industry and Security June 8 issued a temporary denial order for three U.S. companies for their involvement in illegally exported technical drawings and blueprints to China. BIS said it suspended the export privileges for Quicksilver Manufacturing, Rapid Cut and U.S. Prototype for 180 days after they illegally exported materials used to 3D print satellite, rocket and defense-related prototypes, which are subject to strict export controls because of their “sensitivity and importance to U.S. national security,” BIS said.
A recent increase in U.S. sanctions against ransomware actors has helped to slow the effectiveness of cyberattackers and limit their profits, witnesses told the Senate Committee on Homeland Security and Governmental Affairs June 7. But the U.S. can do more to counter ransomware activity, they said, including working closer with allies to track ransomware payments and collecting better information from industry.
The U.S. and Canada this week announced an initiative to strengthen collaboration on Russia-related export controls. In a joint statement, the Bureau of Industry and Security and the Canada Border Services Agency said they will share more trade information to stop Russia from acquiring sensitive technologies, including through coordinated pre- and post-shipment verifications and audits. The two countries will also work more closely on inspections of exports, seizures and export control investigations.