ABOVE: Dubai Court House

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According to a recent report in Gulf News, the English-language daily newspaper based in Dubai, a man who was attempting to export zirconium from the UAE was referred to the Dubai court for prosecution.

Judge Esam Eisa Al Humaidan, Attorney General, … told Gulf News the suspect was referred to court last week and a hearing will be held today. He said this is believed to be one of the very few cases of its kind, if not the first ever.

We’ll put our money on “first ever.”

Humaidan, no doubt aware that his country’s first tiny baby-step into the world of export control is being careful watched by certain people at the Department of Commerce, made clear that he’s doing everything he can not to screw it up:

“We have conducted thorough investigation in the case, to guarantee the complete and accurate implementation of the law,” he said. All procedures were done according the highest levels of accuracy, including ordering the arrest of the suspect, searching him, interrogating him and the other witnesses and the examination of the seized metal, he added

We’re not so sure what the “highest levels of accuracy” in interrogation means in the UAE, but we will take the Attorney General at his word and simply hope that the application of water wasn’t involved.

The background to all of this is, of course, an earlier threat by the Department of Commerce to put the UAE on a special list of countries of “diversionary concern,” which would have made exports of dual-use items to the UAE more difficult. The Department later retracted that threat after noting that the UAE had passed a new export law.

Québec’s Commission des droits de la personne et des droits de la jeunesse (“Human Rights Commission”) issued a press release yesterday describing (somewhat) the settlement agreement entered into between Bell Helicopter and a Canadian with dual Haitian citizenship. The Canadian had been dismissed from an internship with Bell once Bell learned of the Canadian’s dual citizenship. The company based this dismissal on the U.S. arms embargo on Haiti, which would prevent Bell from transferring technical data on U.S. origin defense articles to the Canadian citizen based on his dual citizenship as a Haitian.

The press release noted that the terms of the settlement agreement were confidential. However, since the Canadian citizen’s complaint sought money damages, it can be safely assumed that Bell paid monetary damages to settle the complaint.

Not surprisingly, the Commission’s press release went beyond reporting Bell’s voluntary settlement agreement with the Canadian citizen and expressed the obligatory outrage at the application in Canada of U.S. rules relating to U.S. defense articles:

The Commission reiterates its opposition to the application of the ITAR rules in Québec because of their discriminatory impact. It has conducted a legal analysis of the rules and concluded that they include requirements that are inconsistent with The Québec Charter of Human Rights and Freedoms. More specifically, they infringe the right to equality without discrimination based on ethnic or national origin. “We can no longer accept that companies established in Québec submit to foreign rules that infringe on the values and rights of citizens as recognized by the National Assembly,” says Gaétan Cousineau, the president of the Commission.

And, of course, it would be understandable for the U.S. to say that in such a case it would no longer accept that companies established in Québec be permitted to participate in projects relating to U.S. defense contracts.

Even so, there is a good argument that there is a fundamental unfairness in a U.S. rule that would permit a U.S. citizen who is also a dual citizen of Haiti to receive technical data on defense articles but not to permit a Canadian citizen who also has such dual citizenship to receive the same technical data. The U.S. has already conceded that it won’t apply this dual citizenship rule to Canadian government employees. This decision of the Québec HRC may prompt a faster resolution of the dispute between Canada and U.S. on the application of the dual-citizen rule to private enterprises in Canada, notwithstanding the overheated rhetoric of the Canadian commission.

Alexander Lukashenko

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Sometimes even somebody as distasteful Belarus’s dictator Alexander Lukashenko may have a point. Reacting to news that the U.S. may be considering further sanctions against Belarus, Belarus’s ambassador to the United States, Mikhail Khvostov, held a press conference to denounce the U.S. sanctions as illegal. The further sanctions against Belarus will likely target other state-owned companies in the same fashion that sanctions were imposed earlier this year on Belarus’s state-controlled oil-processing and chemicals company, Belneftekhim.

Khvostov pointed to the Memorandum on Security Assurances signed by the United States and Belarus in 1994. The U.S. entered into this Memorandum in exchange for Belarus agreeing to accede to the Nuclear Non-Proliferation Treaty. The relevant provision is this:

The United States of America, the Russian Federation, and the United Kingdom of Great Britain and Northern Ireland, reaffirm their commitment to [Belarus], in accordance with the principles of the CSCE Final Act, to refrain from economic coercion designed to subordinate to their own interest the exercise by the Republic of Belarus of the rights inherent in its sovereignty and thus to secure advantages of any kind.

According to Khvostov, the imposition of economic sanctions on Belarus notwithstanding this provision “shows that at any time the Bush administration can roll back the U.S. security assurances given to a legally binding instrument.” Not surprisingly, David Kramer, a State Department spokesman, countered that “We consider our actions to be wholly consistent with our political commitments and our obligations.”

It’s hard, however, to square the sanctions with the Memorandum unless one accepts one of two possible, but untenable, arguments. First, it might be argued that the sanctions are aimed at Lukashenko, members of his regime, and one state-owned company and not at Belarus itself. But the Memorandum prevents economic coercion broadly without making an exception for economic coercion targeting regime members and state-owned companies rather than the entire country. Second, it might be argued that the anti-democratic activities of Lukashenko which serve as the basis of the sanctions are not rights “inherent in sovereignty,” but this argument seems strained as well since sovereignty means, in the broadest sense, the right for a country to do what it wants, including things that are not necessarily democratic.

The Directorate of Defense Trade Controls (“DDTC”) issued today a final rule amending section 127.12 of the International Traffic in Arms Regulations (“ITAR”) which governs voluntary disclosures of violations of the ITAR by exporters of defense articles and defense services. Four significant revisions were made.

The new rules require additional specification of details and identifying information in a voluntary disclosure. Second, the new rules state that the voluntary disclosure must link new compliance initiatives in the exporter’s compliance program to the specific violations uncovered. Third, the DDTC may require, in the case of a “systematic pattern of violations,” a signature of “senior officer” on the voluntary disclosure

By far the most significant change effected by the new rule is a time limit between the initial and final disclosures. Under the new rule, the exporter who makes a preliminary disclosure must now file its final disclosure with DDTC within 60 days of the preliminary disclosure. Prior to this change, there was no time limit for the final disclosure, although DDTC staff encouraged the final disclosure to be made reasonably promptly. The new rule provides that the exporter may request an extension of the 60-day period if additional time is needed, although DDTC is under no obligation to grant the extension. Failure to file the final disclosure within the requisite time period may be used as DDTC as a reason to disregard the voluntary disclosure as a mitigating factor in assessing the penalty.

Of course, more than a few eyebrows have been raised in the export community that the notoriously slow agency should be imposing stricter “hurry up an wait” deadlines on exporters. Voluntary disclosures can take more than a year before the agency responds. Amendments to technical assistance agreements can also take a year or more, and commodity jurisdiction requests can fall into a black hole and remain unadjudicated for years. Worse certain agency employees have suggested that if Congress imposes time limits on DDTC for the processing of export licenses and other agency actions, the agency will simply respond by bouncing export license applications for minor technicalities. In view of this, one would hope that DDTC won’t be stingy in granting exporter requests for additional time to complete their internal investigations of voluntary disclosures that have been preliminarily disclosed.