As the EU implements its new import restrictions on Russian iron and steel, European companies are starting to ask U.S. exporters whether their products contain those Russian metals, said Scott Gearity, a consultant with the Export Compliance Training Institute. Gearity said most U.S. companies shouldn’t face any legal issues in making that certification, and Bailey Reichelt, a lawyer with Aegis Trade Law, stressed that companies don’t need to include an end-use statement as part of every benign contract, a practice that could scare potential customers that don’t deal in items subject to trade controls.
Companies receiving a subpoena from U.S. sanctions and export control agencies should be “careful not to over respond,” which can lead to more questions from the government and potentially an expanded investigation, Torres Trade Law said in an Oct. 31 client alert. Although businesses receiving a subpoena are generally required to respond, the company should first take time to determine why it received the request and have “internal discussions with relevant personnel to gain an understanding of the situation before submitting a response.” It’s “always a good idea to review the scope of an information request and be deliberate in responding within those parameters,” the firm said.
The U.S. this week announced a spate of new Russia-related sanctions and export controls, targeting people and companies supplying Russia’s military, aiding its defense industrial complex or operating in various Russian financial, metals, government and procurement sectors. The measures include additions to the Commerce Department’s Entity List and more than 200 combined sanctions by the Treasury and State departments targeting businesses in China, the United Arab Emirates and elsewhere for sending export-controlled components to Russia.
The Commerce Department again renewed a temporary export denial order for Mahan Airways because the airline continues to violate the order and the Export Administration Regulations. Mahan Airways has been on the banned list since 2008, and Commerce in its Oct. 31 notice said the Iranian airline has continued flights between Iran and Iraq, Russia, China and Pakistan in violation of U.S. export controls. BIS also highlighted its "continued investigation" into Mahan’s recent acquisition of an Airbus A340 with Iranian tail number EP-MJA, which the agency said had flown between Tehran and Moscow as recently as Oct. 25.
The Bureau of Industry and Security is inching closer toward potentially publishing a final rule that could revise export licensing requirements for certain cameras, systems or related components. The rule, sent for interagency review Oct. 31, will “better align controls with technological and commercial developments,” BIS said. The rule has been on the BIS regulatory agenda for several years (see 2307170038, 2206270007 and 2112210044).
The Bureau of Industry and Security added 13 entities from Russia and Uzbekistan to its Entity List for helping Russia procure and develop unmanned drones. The entities, listed in a final rule effective Nov. 2, are subject to license requirements for all items subject to the Export Administration Regulations, and licenses will be reviewed under a policy of denial, apart from certain food and medicine. The entities are also subject to licensing restrictions under the BIS Russia/Belarus-Military End User Foreign Direct Product rule.
The Bureau of Industry and Security is preparing to revamp its website, said Tirrell McKnight, an official with the BIS western regional office. She said the site is in "beta evaluation" and could be launched as soon as January. "We have heard from you all that it's cumbersome and it's dated," McKnight said Oct. 28 during the Pacific Coast Council's Western Cargo Conference, known as Wesccon. "Look for an upgrade to our website relatively soon."
Export Compliance Daily is providing readers with the top stories from last week in case you missed them. You can find any article by searching for the title or by clicking on the hyperlinked reference number.
Forwarders should think carefully before they file an export license application on behalf of a customer, a service that could make the forwarder liable in case of an export violation, said Tirrell McKnight, an official with the Bureau of Industry and Security's western regional office. McKnight suggested export application services should only be offered by forwarders who are confident in their export compliance, know their customers well and “want to take on that liability.”
A new executive order on artificial intelligence signed by President Joe Biden this week doesn’t explicitly mention export controls or other trade restrictions, but it does outline the administration's goal of working with other countries to protect against dangerous uses of AI and maintaining U.S. leadership in the technology. The Commerce Department also said the Bureau of Industry and Security, as well as other agency offices, will "be responsible for carrying out a significant portion of the EO’s objectives."