ExportLawBlog

Dec

12

This and That

Posted by Clif Burns at 7:20 pm on December 12, 2011

Category: General

ACI Boot Camp Here are a few things worthy of your attention.

The ACI’s Second National EAR Boot Camp is coming up and will be held in Dallas on January 25 and 26, 2012. Export Law Blog readers who mention discount code EB200 will get a $200 discount on their registration fees. Download the promotional brochure here. There are some great speakers scheduled but you may want to go in particular to hear Gene Christensen from BIS. Gene knows as much about the EAR as anyone in BIS and is an all-round nice guy who shares his time freely to help out exporters dealing with his agency.
Speaking of nice guys, John R. Liebman, Roszel C. Thomsen II, James E. Bartlett III have just released United States Export Controls, Sixth Edition. John sent me an email describing the changes in the latest edition

The new edition is noticeably slimmer than its predecessors, primarily due to the consolidation of two chapters covering Commerce regulations into one and the deletion of several tables and appendices that were no longer useful (if they ever were). New chapters include the Foreign Corrupt Practices Act and its intersection with export controls. In addition, Roz, Jim and I are working on additional chapters that could not be completed before the publisherâ€™s deadline, and those should be available in 2012, along with regular quarterly updates. Among them will be discussions of export control aspects of cloud computing, the Foreign Trade Regulations, and the ongoing efforts to overhaul the current patchwork of export regulations. Finally, this edition will be the first that is available electronically as well as in hard copy.

There aren’t any special discounts for Export Law Blog readers, but the book is worth every penny even at full price.
If you have downloaded the new Google Currents app onto your iPhone, iPad, or Android device, there is a specially formatted edition of Export Law Blog that you can subscribe to in that service. To subscribe, click this link from the browser on your mobile device. Or click the plus icon to add more news sources and search for “Export Law Blog.” (You probably could have figured that out on your own!)

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

Dec

8

OFAC Flirts With 21st Century

Posted by Clif Burns at 8:19 pm on December 8, 2011

SDN Search Screen The Office of Foreign Assets Control (“OFAC”) has just debuted a new web page which features a facility allowing users to search OFAC’s Specially Designated Nationals and Blocked Persons list. Go to that new page by clicking here. Put in a name and it quickly spits out the results. You can even export those results to an Excel spreadsheet. The page worked perfectly on my Android phone in case you need to consult the SDN list while on the run.

But before you get too excited there is a major limitation. As the hilariously prolix disclaimer attached to the site notes, all searches are literal. No close matches are returned. Misspelled names won’t yield any results. This is a big deal since a large number of the names on the list are roman character transliterations from the Arabic and Persian where there is no agreed convention on transliteration.

Let’s just pull an example that immediately comes to mind like . . . say . . . Khadaffi. Enter that last name and you get no results, even though there are members of the Khadaffi family that are alike, kicking and still on the SDN list. In all fairness, ABC News reports that there are more spellings of the notorious family name than you can shake a stick at.

Beyond that, the lawyers have gotten to the page with an OFAC version of the “don’t try this at home, kids” disclaimer:

Use of this system implies understanding that searches performed by SDN Search are conducted at the userâ€™s own risk, and that the search results provided by SDN Search do not represent an official confirmation by the Office of Foreign Assets Control or the Department of the Treasury of the existence or absence of a match between any information entered by the user and any information contained on the SDN List. The use of SDN Search does not limit or excuse any liability for any act undertaken as a result of, or in reliance on, such use.

In other words, use at or own risk and if the site misses a match, well, that’s your problem and OFAC reserves the right to fine you $250,000 anyway. Even if the mistake was OFAC’s fault.

This is not much different from the ridiculous disclaimer that OFAC prints each time it prints a new version of the SDN list in the Federal Register:

The list published as Appendix A is not definitive or all-inclusive, and new or updated information may be added to OFAC’s Web site and published in the Federal Register at any time. U.S. persons or persons subject to U.S. jurisdiction, depending on the sanctions program, are advised to check the Federal Register and the most recent version of the SDN List posted on OFAC’s Web site for updated information on designations and blocking actions before engaging in transactions

So even with the printed SDN list, OFAC has to tell you that you can’t rely on it and that you can’t engage in any transaction without searching the last century of the Federal Register all the way back to the first issue in 1936 to see if a party was designated by OFAC but inadvertently left off the SDN list. Right.

(For a humorous rewrite of the search site disclaimer, go read Scott Kinney’s blog post on it.)

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

Dec

6

Imaginary Numbers

Posted by Clif Burns at 9:17 pm on December 6, 2011

Category: DDTC

Although I am not a mathematician, I have recently discovered (with the help of a regular reader) some new imaginary numbers other than those well known imaginary numbers that are the square roots of negative numbers. The new imaginary number can be found on the list of final commodity jurisdiction determinations published by the Directorate of Defense Trade Controls (“DDTC”).

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.

I have an idea of what might have happened. I think this is a typo for ECCN 3A991 which covers “[e]lectronic devices and components not controlled by 3A001,” which is where some MMICs and HMETs are classified. ECCN 3A991 immediately follows ECCN 3A981, so somebody at DDTC more or less renumber 3A991 as 3A982. Anybody have a better theory about what happened?

And. although I love the new final determination list and applaud DDTC for putting it on line, please allow me one final quibble and I’ll never say another negative thing about the list. For some reason, the page that has the list will not open up in Chrome. On behalf of Chrome users everywhere (and we now are 18 percent of all browser users), it would be nice if this could be fixed.

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

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 Commerce Oh, 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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Nov

30

Debugger Invokes Export Law As A Defense To Larceny Charge

Posted by Clif Burns at 5:33 pm on November 30, 2011

Category: General

Rockport Harbor This story in the Gloucester Daily Times involving prosecution of a Rockport, Massachusetts man for, among other things, possession of a rocket launcher (only for protection against burglars, of course) has an interesting export law angle. The defendant, James Atkinson, is an emergency medical technician working for an ambulance company and owns a company called Granite Island Group, which apparently is involved in providing counter-surveillance consulting services and equipment.

Rockport authorities, according to the newspaper article, first became aware of Atkinson when a Swiss company complained that Atkinson failed to deliver $32,000 of counter-surveillance equipment that it had ordered from Granite Island. This led to a larceny arrest, a home search, and, voilÃ , the discovery of the rocket launcher and other firearms.

Mr. Atkinson’s defense to the larceny charge was interesting. According to the newspaper article, he hadn’t shipped the equipment “because the firm didn’t supply him with proper export documents.” This is an odd defense, it it can be called a defense, because it’s not clear that surveillance countermeasures such as those being sold by Mr. Atkinson required an export license. ECCN 5A980 covers surreptitious listening devices but does not cover devices used to detect or disable such surreptitious devices.

Of course, even if export licenses were required and somehow could not be obtained, there’s still the issue as to why the purchase price wasn’t simply refunded. But that, of course, involves matters unrelated to my expertise and the subject of this blog, so I’ll let each reader speculate independently on this issue.

Naturally Mr. Atkinson was not going to sit around and let the city take his rocket launcher just because he was accused of welching on an export:

Atkinson filed a 653-page lawsuit against the town, Rockport Police, the Commonwealth of Massachusetts, and scores of institutions and individuals.

His lawsuit asks for, among other things, $175 million from the town. He has said the town violated his civil rights by entering his home and confiscating his firearms.

You might be surprised by the sheer length of the lawsuit, apparently only a few pages short of War and Peace, but that’s only if you are unaware of the binding legal precedent that requires that judgments always be granted in favor of the side that files the most paper in a proceeding.

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