It’s a slow day today in export news, so we’re bringing you a grab bag of various items, each interesting but none worthy of an entire post:

• Vanderbilt University has announced that it has hired a new assistant director of export compliance to handle the “new wave of federal export control regulations that is crashing down on Vanderbilt.” Were we asleep and missed a new wave of export control regulations or did Vanderbilt just wake up and discover the export regulations that crashed down on Vanderbilt years ago?
• An article on the Deutsche Welle website indicates that German firms are circumventing sanctions on Iran by doing business in Iran with suitcases of cash to avoid detection. This leads to the day’s most amusing quote from a German businessman living in Tehran:
  

  “If a plane crashes on its way to Tehran from Germany, then the loss of the luggage would be more expensive than the loss of the plane,” he said.

• A spokesman for the State Department testified yesterday in a Senate hearing that in response to the sham electoral victory of Robert Mugabe in Zimbabwe, the United States is considering additional sanctions against individuals and government entities in Zimbabwe. Raise your hands if you think these will lead Mugabe to break down in tears, resign his office, and flee the country.

ABOVE: Coke and Fanta in Iran

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A fascinating Associated Press article published today reports the results of an FOIA request the wire service made for information relating to U.S. exports to Iran. According to the information obtained by the AP, U.S. exports have grown more than ten-fold during the last seven years of the Bush administration, notwithstanding U.S. concerns about nuclear proliferation activities by Iran. The largest export: cigarettes. Almost $158 million dollars worth of cigarettes. That’s a lot of lung cancer and heart disease. (Full disclosure: as a former smoker, I tend to be a rabidly anti-smoking.)

Most surprisingly, the figures given to the AP reveal military exports to Iran, including $106,635 in military rifles and $8,760 in rifle parts and other accessories. Adam Szubin, speaking for the Office of Foreign Assets Control, argued that it was unlikely that these exports actually occurred and cited the possibility that shipping documents listed these codes erroneously or that shippers may have confused Iran and Iraq when filling out these documents. Some support for this can be found in government data saying that the U.S. exported $13,000 in “aircraft launching gear and/or deck arrestors” to Iran. As far as anyone knows Iran doesn’t have any aircraft carriers Still, even if these were mistakes by the shippers, one has to wonder why someone at Customs didn’t catch these mistakes.

Agents of the U.S. Immigration and Customs Enforcement (“ICE”) raided the Washington state facilities of Aerospace Manufacturing Technologies, Inc., and walked away with thirty-two workers that ICE alleges were illegal immigrants working at the facility. Those workers are now in ICE custody in Tacoma, Washington, and are being processed for deportation.

According to the article reporting the raid, the ICE action was part of its “Worksite Enforcement” initiative. This initiative, which has its own enforcement unit, targets critical infrastructure and sensitive sites. AMT manufactures parts for civilian and military aircraft and is registered with the Directorate of Defense Trade Controls.

Assuming that the workers are ultimately determined to be illegal and undocumented aliens, AMT might be expecting, sooner rather than later, a visit from the enforcement staff of DDTC. After all, if there were thirty-two foreigners working in a facility that manufactures military aircraft parts, there will certainly be a reasonable suspicion that AMT may have transferred technical data on these military parts if, by no other reason, allowing them to see certain of the military parts. Exports under section 120.17 of the International Traffic in Arms Regulations includes “visual disclosure.”

A major topic of discussion in the deemed export area has been the possible ramifications of having legal and or illegal foreign workers on cleaning crews and in IT departments. There hasn’t been real discussion of illegal foreign workers actually involved on production crews because, I suppose, it was thought that this wasn’t a very likely possibility. Until now.

The folks at iRobot not only make the Roomba, which will robotically vacuum your floors and drive your dog insane, but also they make military iRobots, which will chase down and, er, vacuum up terrorists, enemy combatants, and other assorted malefactors. I, for one, would not like to see the bad boy pictured on the right chasing me down some hallway or alley. Not every iRobot, however, packs heat, and many perform certain defensive military missions such as handling and disabling IEDs, detecting chemical and biological warfare agents, and other cool stuff.

According to this recent post at Planetary Gear, the iRobot is attracting as much foreign interest as the iPhone and the iPod. And that, of course, raises a few export issues. Depending on how the robot is decked out, it can either be a killer robot of doom or WALL-E, the trashbot. The iRobot can be just as useful to first responders as to military troops.

A review of the iRobot product literature indicates that the company has played it safe and simply takes the position that the tactical iRobot is USML whether or not it’s been given the naughty or nice accoutrements. But technology is quickly outpacing the creaky old United States Munitions List, and it’s not very clear what is the correct USML category for the robot. Of course, there’s always Category XI: “electronic equipment . . . which is specifically designed, modified or configured for military application.” Or “catch-all” Category XXI for an article not enumerated in the other categories “which has substantial military applicability” and “which has been specifically designed, developed, configured, adapted or modified for military purposes.” But that seems rather unsatisfying, doesn’t it? Shouldn’t something this deadly have its own category?

And suppose that iRobot took a hard line position that a robot not outfitted with military gear but capable of being so outfitted wasn’t USML, what would be the ECCN of the robot?

(For those confused about the title, go here.)

Earlier this week, Rep. Anthony Weiner (D-NY) introduced H.R. 6361, or the “Stop Business with Terrorists Act of 2008,” which was introduced into the Senate earlier this year as S.1234 by Senators Lautenberg (D-NJ) and Clinton (D-NY). The purpose of the bill is to reverse current law which permits, in limited circumstances, dealings by foreign subsidiaries of U.S. firms with Iran.

Under current law, a foreign subsidiary could do business with Iran in the following circumstances. First, it must be a foreign subsidiary incorporated in a foreign jurisdiction, not a branch operation of a U.S. company. Second, the transactions with Iran cannot involve any U.S. persons. Third, some have argued that in order not to be seen as a device to evade the sanctions, the foreign subsidiary must have some business other than dealing with Iran.

Under the Stop Business with Terrorists Act of 2008, a parent company will be liable for acts of its foreign subsidiaries with respect to Iran that violate Executive Order 12959 and Executive Order 13059 notwithstanding its incorporation in a foreign jurisdiction and the absence of U.S. involvement in the transaction at issue. Those Executive Orders prohibit, among other things, exports and reexports of U.S. origin goods, services and technology to Iran.

Although this legislation doesn’t fall directly within the purview of the European Union’s blocking legislation, Council Regulation (EC) No 2271/96, one has to wonder whether yet another effort by the U.S. to extend the scope of its sanctions regulations outside its own borders will provoke any countermeasures or retaliation by Europe. Of course, the extraterritorial scope here is more limited than it was in the Iran and Libya Sanctions Act because only the U.S. parent is penalized under the proposed legislation. Still, the legislation will have a direct impact on the operations of E.U. companies insofar as their U.S. parents prohibit them from dealings with Iran.