On September 9, the Commerce Department’s Bureau of Industry and Security (BIS) published an interim final rule to clarify how American industry can participate in international standards-setting activities when interacting with entities on the Entity List.
Continue Reading With New Rule, BIS Seeks to Ensure Fuller American Participation in Standards-Setting Discussions
Key Takeaways from Recent ECRA Compliance Case
I recently authored an article for Law360 providing insight on a recent appellate ruling related to violations of the Export Control Reform Act (ECRA), along with takeaways from the case and next steps from the U.S. Department of Commerce to address related compliance issues.
Continue Reading Key Takeaways from Recent ECRA Compliance Case
Commerce Targets Chinese Military-Civil Fusion Program as Seven Chinese Entities Added to the Entity List
Today, the U.S. Commerce Department’s Bureau of Industry and Security (BIS) published a final rule adding seven Chinese entities to the Entity List. The U.S. government determined these seven entities, primarily supporting the Chinese aerospace and space industries, had acted “contrary to national security and foreign policy interests of the United States.” BIS stated that the entities were acquiring or attempting to acquire U.S.-origin items to support China’s military modernization campaign. These seven entities bring the total number of listed Chinese entities to approximately 600.
Continue Reading Commerce Targets Chinese Military-Civil Fusion Program as Seven Chinese Entities Added to the Entity List
History and Trajectory of the Entity List Related to National Security Concerns
I recently co-authored an article for WorldECR with Scott Jones, a nonresident fellow at The Stimson Center, examining the history and current trajectory of the Entity List, part of the Export Administration Regulations (EAR) administered by the U.S. Bureau of Industry and Security (BIS) to help protect U.S. national security. In the article, we outline the history of the Entity List and discuss the need for a just and transparent removal mechanism.
We state that “since the 2008 change in scope to include national security and foreign policy concerns, the number of parties added to the Entity List has increased dramatically” from its original purpose of preventing the proliferation of weapons of mass destruction. With the recent technology conflicts between the United States and China, we argue the Entity List has become the most convenient tool in the toolbox to further U.S. national security and foreign policy goals.Continue Reading History and Trajectory of the Entity List Related to National Security Concerns
[WEBINAR] Update on Export Enforcement
The U.S. government continues to vigorously enforce U.S. export laws against both U.S. and non-U.S. companies. In addition to monetary penalties, companies charged with violating U.S. export laws may be subject to strict compliance obligations. In extreme cases, the U.S. government may even suspend a company’s export privileges.
In this webinar, we will discuss recent
BIS Imposes Civil Fine and Compels Hiring of Compliance Official or Cease Operations
On October 12, the U.S. Commerce Department, Bureau of Industry and Security (BIS) announced that it imposed a civil penalty fine against VTA Telecom Corporation (VTA) for the unauthorized export of controlled commodities to Vietnam. Additionally, BIS is requiring VTA to improve its export control compliance efforts and retain a Director of Trade Compliance. Alternatively, VTA can dissolve or cease operations.
VTA, located in Milpitas, California, was established in 2013 as a subsidiary of a Vietnamese state-owned telecommunications company. BIS is the primary U.S. government agency responsible for administering and enforcing export controls on commercial items that could support weapons proliferation and other threats to U.S. national security.
According to BIS, VTA procured and exported items from the United States to its parent company in Vietnam with knowledge that certain of those exports were intended to support a Vietnamese defense program. To settle the matter, VTA agreed to the following:
- A penalty of $1,869,372.
- Expenditure of $25,000 to fund its internal export compliance program (ICP).
- Hiring and retention of a Director of Trade Compliance to oversee VTA’s export activities for at least two years.
U.S. Technology Company Pays for Unauthorized Exports to Russia
On September 28, the U.S. Commerce Department, Bureau of Industry and Security (BIS) announced that it has imposed a civil penalty fine and denial of export privileges against Vorago Technologies (Vorago) for the unauthorized export of controlled commodities to Russia.
Vorago is a U.S. manufacturer of integrated circuits for use in environments with high radiation levels and extreme temperatures. The company’s products are particularly well suited for use in space. BIS is the primary U.S. government agency that administers and enforces U.S. export controls on commercial items, including particularly strict licensing requirements on items that can be used with weapons of mass destruction or conventional weapons.
According to BIS, Vorago engaged in a conspiracy with a Russian company, Cosmos Complect (Cosmos), to circumvent U.S. export controls. To settle the matter, Vorago agreed to the following:
- A penalty of $497,000, and
- Denial of export privileges until September 2023.
The denial of export privileges, and roughly half of the penalty, will be suspended as long as Vorago complies with the terms of the settlement.Continue Reading U.S. Technology Company Pays for Unauthorized Exports to Russia
Princeton Penalized for Alleged Research-Related Export Violations
On February 1, the U.S. Commerce Department, Bureau of Industry & Security (BIS), announced a settlement (available here) with Princeton University in connection with 37 alleged violations of the Export Administration Regulations (EAR). The EAR are the main regulations that govern exports of commercial goods, software and technology; BIS has principal responsibility for administering and enforcing the EAR.
The settlement is a valuable reminder of the amount of export-controlled activity that takes place at and involving universities, academic medical centers, and other research institutions. Penalties for export violations can be significant. Legal departments, compliance departments, and offices of sponsored research therefore must ensure that faculty – many of whom may be non-U.S. nationals – are aware of their responsibilities under U.S. export law.
Alleged Violations
According to BIS, the violations occurred when Princeton exported strains and recombinants of animal pathogen to non-U.S. research institutions. These items are controlled for export for chemical and biological reasons, and thus an export license is required to make the exports. Princeton did not obtain the necessary export licenses.Continue Reading Princeton Penalized for Alleged Research-Related Export Violations
Webinar – Export Controls: Compliance Challenges and Best Practices
Thad McBride will present with Brian Cope, Director of International Trade for International Paper Company, at a Clear Law Institute webinar focused on exploring the key challenges companies face when engaging in export transactions, as well as best practices for avoiding enforcement action. Attendees of the webinar will learn to:
- Examine the primary U.S. export controls laws and regulations
- Understand penalties and recent enforcement actions
- Recognize key compliance challenges, such as
- Technology transfers
- Conducting business with third parties
- Entering new markets
- Explore compliance best practices to prevent and detect violations
EVENT DETAILS:Continue Reading Webinar – Export Controls: Compliance Challenges and Best Practices
Challenges under the EAR and ITAR Webinar
I will be co-hosting a webinar on Tuesday, November 29 on compliance challenges under the Export Administration Regulations (EAR) and International Traffic in Arms Regulations (ITAR). Key topics that will be covered in this webinar include ITAR and EAR amendments and new rules; jurisdiction and classification; licensing, agreements, and exceptions; effective compliance practices; recent enforcement;