Archive for the ‘BIS’ Category

Feb

2

Russkies No Longer Bullish on Dual Use . . . Cows

Posted by Clif Burns at 8:17 pm on February 2, 2012
Category: BIS • General

Virginia P. HolsteinWell, who would have thought that a Google news search on “dual use exports” would turn up a WaPo story on the export of bulls from Virginia to Russia? Or that the story would talk about “dual use cows”? I certainly did not, which is what mooo-ved me to write this post.

According to the story, twenty-nine Holstein bulls have already been exported to Russia and another thirty are to follow. The bulls are set to, er, revitalize (at least that’s what the kids call it now) Russian Holstein dairy herds. The need for bulls with that certain American panache was explained as follows in the story:

Russian farmers want American bulls to improve dairy-herd genetics in a land hampered first by collective farming, then by the collapse of the Soviet Union. …

Instead of raising dairy cattle for milk and beef cattle for meat, Soviet collective farms had “dual-use” cattle, which would be milked for a while, then killed for meat, Osipenko said. Those one-size-fits-all cattle may have embodied an egalitarian ideal, but both milk and meat were mediocre, said Osipenko, a native of Ukraine who recalled his mother boiling beef for hours in a fruitless attempt to tenderize it.

After the Soviet Union collapsed, many dairy herds were all but wiped out as hungry Russians consumed them for food.

“There was a terrible crisis, apparently, and they pretty much ate their seed stock,” said Patrick Comyn, a large-animal veterinarian with the private Virginia Herd Health Management Services who worked on the deal.

And that’s where the exported bulls come in. I am sure that the Virginia bulls will be delighted, to the extent that bulls can be delighted in the first place, that they are fulfilling both a carnal and a patriotic duty.

Of course, these mail-order American husbands may never have seen their wealthy Russian wives if they had been horses because, as all export geeks know, export of horses by sea (ECCN 0A980) requires a license from the Department of Commerce. Personally, I think this is another example of wanton discrimination against American cows in favor of American horses which are spared from both the dinner table and long ocean voyages.

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Jan

18

Mystery Solved (Maybe)

Posted by Clif Burns at 6:29 pm on January 18, 2012
Category: BIS • DDTC

MMICIn a post back in December titled “Imaginary Numbers,” I noted that the list of commodity jurisdiction determinations by the Directorate of Defense Trade Controls had some puzzling entries:

Three entries on the list, two for a high mobility electron transistor (“HMET”) and one for a microwave monolithic integrated circuit (“MMIC”), indicate that the correct classification for these items is ECCN 3A982. The problem is that there is no ECCN 3A982, and there has never been, at least that I could find.

Well today I came across a notice of a final rule by the Bureau of Industry and Security, dated January 9, 2012, and effective on the same date, which creates a new ECCN 3A982 for HMETs and MMICs. Of course, the mystery remains as to how the DDTC could classify something as ECCN 3A982 before the ECCN actually existed, but I suppose that only bothers people concerned about the rule of law and other minor details.

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Jan

5

FedEx Agrees To Pay $370,000 Export Penalty

Posted by Clif Burns at 8:04 pm on January 5, 2012
Category: BIS

FedExFederal Express has agreed to pay to the Bureau of Industry and Security (“BIS”) a penalty of $370,000 in connection with charges that it aided and abetted one export and five attempted exports between 2004 and 2006 without required export licenses. Three of the attempted exports were to Syria and the other two were to the Mayrow Trading Company in Dubai which had been subjected to a license requirement by BIS in General Order No. 3 issued on June 5, 2006. The remaining violation, and the only actual export, involved a shipment to a company in China on BIS’s Entity List.

Interestingly, the Settlement Agreement only provides for the payment of the $370,000 fine. There are no provisions, as are now often seen in these agreements, requiring enhanced compliance procedures or export audits.

A spokesman for FedEx, speaking today to a Memphis newspaper, described the violations as “inadvertent and very limited.” This certainly makes sense for the attempted Mayrow exports, which occurred in July 2006, only a month after General Order No. 3 imposed the license requirement on exports to Mayrow. Because Mayrow and the other companies listed in General Order No. 3 were not immediately put on the lists that exporters customarily checked, the FedEx error here is understandable.

The statements from the FedEx spokesman also indicate that the exports were discovered and stopped by the government based on the Automated Export System filings made by FedEx in connection with the shipments. That being the case, it is clear that FedEx had not attempted to disguise what it was doing and that its own compliance procedures had not flagged the problematic shipments.

The settlement documents provide no indication as to what actions, if any, were taken against the FedEx customers that initiated these shipments.

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Dec

13

Call Kevin Wolf

Posted by Clif Burns at 7:24 pm on December 13, 2011
Category: BIS • Export Reform
Kevin Wolf
ABOVE: Kevin Wolf

Who says you never have gotten to talk to an Assistant Secretary of Commerce? Tomorrow, Wednesday, December 14, 2011, you can dial up Kevin Wolf at 2:00 p.m. to discuss the White House’s current export reform proposals. The dial-in number for the conference calls will be 1-877-389-6079, Participant Code: 905168. BIS has announced that this will be the beginning of a weekly series of calls on export reform with Assistant Secretary Wolf that will take place each Wednesday at 2:00 pm EST.

There’s only one small catch: Questions for Kevin should be sent in advance of the call to oesdseminar@bis.doc.gov with a subject line of “Teleconference questions.” This is to avoid having someone from the Howard Stern show hijack the teleconference with inappropriate questions. (That, of course, isn’t the real reason, but it would be a good one.)

The stated purpose of these calls is “to foster public understanding of the initiative and to assist interested parties to prepare more informed comments.” I have been told by a reliable source that so far BIS has received almost no comments on these proposals and that BIS is very much interested in input from the export community. There are three public notices relating to the export control reform initiative with comment periods that are still open: the comment period for the notice on aircraft and related parts closes on December 22, 2011 (i.e. almost tomorrow) and the comment period for the notices relating to gas turbine engines and military vehicles closes on January 20, 2012.

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Dec

5

Don’t Go Giving BIS Any Ideas

Posted by Clif Burns at 6:04 pm on December 5, 2011
Category: BIS • DDTC

Department of CommerceOh, the things you’ll learn when you read the documents that companies file with the Securities and Exchange Commission:

In March 2011, BlastGard’s management team officially assumed operational control of HighCom. Since this time we have accomplished a number of key compliance tasks and finalized manufacturing agreements with several key partners. As stated in the paragraph above, BlastGard has received official communication from the U.S. State Department that HighCom’s export authority has been reinstated. In addition to this, BlastGard has completed registration through both the Directorate of Defense Trade Controls as well as the Bureau of Industry and Security (“BSI”). The purpose of these registrations is to allow BlastGard control over the export management and compliance program moving forward.

Completing registration with the Bureau of Industry and Security is quite an accomplishment — considering the BIS (or is it BSI?) doesn’t have a registration process. Perhaps they mean that they’ve gotten a PIN for the SNAP-R system? And we’ll award the coveted “Reader of the Week” prize to anyone who can figure out what the last sentence in that quotation means.

All kidding aside, I still am somewhat surprised that BIS hasn’t gotten on the needless user fee gravy train yet along with DDTC. It’s probably only a matter of time before BIS realizes that there’s gold in them registration hills, and then companies will be able to boast in press releases that they’ve been certified as export-compliant and super cool by BIS in addition to having been certified by DDTC.

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