Feb

2

DDTC Changes Requirements for Certain Electronic Agreement Filings

Posted by at 9:16 pm on February 2, 2011
Category: DDTC

State DepartmentOne of the jobs of this blog is to inform our faithful readers about changes that DDTC makes in its rules and guidelines but, for whatever reason, decides that it should keep secret. Currently Section 13.2(a)(3) of the Guidelines for Preparing Electronic Agreements (7 Oct 2009), requires applicants to attach to proviso reconsideration requests a separate scanned pdf copy of the DSP-5 Agreement approval. It also requires that the 9-digit DSP-5 number be referenced in blocks A and C of the continuation to Block 8.

Notwithstanding Section 13.2(a)(3), DDTC has not been requiring scanned copies of the approved DSP-5 be submitted with the proviso request, presumably because the 9-digit DSP-5 number permits licensing officers to access the agreement approvals in the D-Trade system itself. In a recent email to an exporter, the DDTC recently confirmed that the scanned copy is no longer necessary in proviso reconsideration requests. It also noted that amendment requests did not require the inclusion of a scanned copy of the license approving the agreement in question. Apparently, this change in processing requirements will be made public when DDTC gets around to issuing a new version of these guidelines.

The change of procedure with respect to agreement amendments poses a bit of a problem, which the DDTC email acknowledged. Under the guidelines, if the last amendment/basic agreement was submitted electronically, the exporter must use the 9-digit DSP-5 number to identify the case. Otherwise, the exporter must use the 6-digit DA/MA/TA number to identify previous paper cases. But if the DA/MA/TA number is used, the people at the Defense Technology Security Administration (“DTSA”), which uses the electronic U.S. Export System, can’t get access to those prior agreements. Whether this has slowed down DTSA’s approval of these requests is not known.

The U.S. Export System is supposed to become the unified electronic filing and processing system for all exports. Whether the new guideline permitting the exporter to omit a scanned copy of the license will survive when and if the unified system goes into place is also not known.

Permalink

Bookmark and Share

Copyright © 2011 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)

One Comment:

DDTC does not allow you to amend a paper agreement electronically – you have to rebaseline the paper agreement electronically (and can in that electronic rebaseline application simultaneously also request amendment to the agreement).

For the rebaseline application, you are expected to provide all of the backup required for an application for a new agreement. In this sense, DTSA should not need the prior approval letters to support its review.

That said, the smart move is to upload the letters in support of the rebaseline application. DTSA may ask you to upload them to D-Trade if you don’t (which just adds another day or two to the review cycle). And it is usually good to ensure continuity of provisos and limitations – especially if you’ve fought for and won tailored verbiage via proviso reconsideration in the past. An even smarter move is to transcribe the provisos and limitations into a PDF format from which the reviewers can easily cut-and-paste. Saving them time will mean you get your approvals faster.

The same can be said for uploading prior nine-digit cases. Sure, they may be easier to find electronically with the new system, but if you can save a reviewer a few minutes, why not extend the courtesy? And, oh, by the way, the current guidelines require it.

The simple rule to follow for any license or agreement application is to make it as easy as possible for the reviewers to find the information they’ll need to give full review and consideration to your request. And never give them a simple administrative reason to RWA a case. Follow the guidelines until they are officially changed, because what one reviewer tells you is okay over the phone may be fertile and frequently exercised grounds for RWA in the opinion of another reviewer.

Comment by MJ on February 2nd, 2011 @ 10:51 pm