Companies doing business in the Middle East take note: on March 30th, the Treasury Department published its quarterly list of countries that require participation or cooperation with an international boycott. The primary boycott of concern today is the Arab League’s boycott of Israel. Even though many of the listed countries are WTO members and were required to shut down their Arab League offices as a condition of membership, many boycott-related requests are still being issued by government agencies and companies in these countries.Read More
Polsinelli on International | International Legal Services Blog
Polsinelli's International attorneys provide companies with the tools and information they need to seamlessly and profitably market their products and services in markets across the globe. From corporate structuring to tax issues, import/export to international arbitrations, we understand the cultural and legal nuances that cross-border business can bring.
A few notable developments and announcements on the international trade front took center stage late last week of which U.S. companies with multinational operations should be aware of:
- A new executive order that will give U.S. government agencies greater enforcement tools to combat trade violations;
- A new executive order requiring a report on foreign trading partners with which the U.S. had a significant trade deficit in goods and the major causes of the deficits; and,
- The announcement of nominees for the positions of Commissioner of Customs and Under Secretary of Commerce for Export Administration.
Just a reminder to U.S., exporters that on April 1, 2017, License Code C32 will no longer be accepted into the Automated Export System (AES) as part of the Electronic Export Information (EEI) filing process, and filers reporting License Code C32 will begin receiving fatal errors on that date. In order to avoid any compliance hiccups during the U.S. export clearance process, U.S. exporters should ensure that they have made the required updates to their internal systems for self-filings of the EEI, or have confirmed that their authorized AES filers have made changes to their respective systems.Read More
ZTE Corporation, the largest telecommunications company in China, pled guilty on March 7th to conspiracy charges in U.S. District Court involving illegal exports of U.S.-origin goods to Iran, and agreed to pay $890 million to the U.S. Government, which represents the largest criminal fine and civil penalties that have ever been assessed against a company for violations of U.S. export controls and economic sanctions.Read More
By Melissa Miller Proctor
Last month, U.S. Customs and Border Protection (CBP) import specialists and officers at the Port of Tacoma in the state of Washington seized shipments of goods from China that infringed U.S. trademarks, violated U.S. country of origin marking laws, and violated product safety standards of the National Highway Traffic Safety Administration (NHTSA). One of the shipments contained 120 pieces of furniture valued at $720,000 that infringed U.S. trademarks. The second consisted of microphones and cables with a value of more than $25,000 that were marked “Made & Manufactured in the U.S.A.” even though their outer cartons were marked “Made in China” and the commercial invoice and packing list specified China as the origin of the goods. The third shipment contained automotive headlamps valued at $80,000 that were not in compliance with NHTSA standards. CBP is responsible for enforcing roughly 500 trade laws and regulations on behalf of 47 government agencies—for CBP, the prevention of imports of counterfeit products and illicit goods continues to be a priority trade issue.
On February 22nd, the WTO’s multilateral Trade Facilitation Agreement (TFA) formally entered into force and is expected to usher in new trade facilitation reforms by each of the signatory countries including the United States. Multinational companies and companies eager to expand into global markets should anticipate significant regulatory changes ahead! The TFA is intended to reduce regulatory requirements, increase transparency in customs procedures, and expedite the international movement, release, and clearance of goods around the world. The TFA also calls for increased cooperation between the countries’ customs authorities on trade facilitation and compliance issues and provides technical assistance to developing and lesser developed countries. The WTO estimates that full implementation of the TFA by the signatory countries will reduce global trade costs by 14.3 percent, increase imports and exports by up to $1 trillion per year, reduce import clearance times by 47 percent, and slash export clearance times by 91 percent of the current average.Read More
The Commerce Department’s Bureau of Industry and Security (BIS) has decided to extend the temporary general license for two Entity List parties, ZTE Corporation and ZTE Kangxun, until March 29, 2017. This means that companies may continue exporting and reexporting to these firms without first having to secure a license from the BIS under the Export Administration Regulations (EAR). Last Spring, ZTE Corporation, the second largest telecommunications company in China, was added to the BIS’ Entity List, along with three of its affiliated companies:
- ZTE Kangxun Telecommunications, Ltd.
- ZTE Parsian
- Beijing 8-Star International Company
On February 15th, the European Parliament voted in favor of the Comprehensive Economic and Trade Agreement (CETA) between the European Union (EU) and Canada. European and Canadian companies will soon be afforded new trade benefits once the agreement formally goes into force.Read More
The Commerce Department’s Bureau of Industry and Security (BIS) recently published a rule that will soon impose new documentation requirements on companies that ship certain goods to, or reexport certain items from, Hong Kong. The rule is slated to take effect on April 19, 2017; therefore, affected companies will have a little time to adjust their operations and processes to the new requirements.Read More
Today, the Trump Administration imposed new sanctions on Iran for its testing last weekend of ballistic missiles. Last Sunday, On Sunday, Iran launched the Khorramshahr medium-range ballistic missile from a test site located approximately 140 miles east of Tehran, which traveled 600 miles before exploding. The missile test violated U.N. Resolution 2231 that was issued on July 20, 2015, which bars Iran from conducting ballistic missile tests for a period of eight years. This was Iran’s second missile test (the first one occurring in July 2016), and the first test made under the Trump Administration.Read More
U.S. Companies May Again Submit Encryption Approvals to Import Commercial Information Security Products and Software into the Russian Federation
The Department of the Treasury's Office of Foreign Assets Control (OFAC) published Cyber-Related General License 1 as part of the Cyber-Related Sanctions Regulations in Title 31 C.F.R. 758. The issuance of this General License is critical for U.S. companies that market computers, software, telecommunications devices and similar products in the Russian Federation, as it allows U.S. persons to submit encryption notification requests and import license applications to Russia’s Federal Security Service (a.k.a. FSB), which are required under Russian law, without violating the U.S. cyber-related sanctions on Russia.Read More
This week, the United Kingdom (UK) published an official white paper setting out its Brexit plan, which establishes the key principles that will guide the government in its departure from the European Union (EU). This document outlines the 12 key principles that will govern the EU departure process.Read More
Today, most of the comprehensive U.S. economic sanctions imposed on Sudan have been lifted, and virtually all trade between the U.S. and Sudan that was previously prohibited under the Sudanese Sanctions Regulations (SSR) in 31 C.F.R. Part 538 are now authorized. The lifting of these sanctions was made by Presidential Executive Order on January 13th, as well as the implementation of a new General License today by the Treasury Department’s Office of Foreign Assets Control (OFAC) in Section 538.540 of the SSR. Specifically, the following activities by U.S. persons are now authorized:
- The processing of transactions involving persons in Sudan, including those relating to the petroleum or petrochemical industries in Sudan;
- Exports and reexports of goods, services and technology to Sudan;
- Imports of goods, services and technology into the United States from Sudan;
- Facilitation of transactions between Sudan and third countries; and,
- Transactions involving property in which Sudan has an interest—such property has been unblocked.
U.S. companies doing business in Russia are urged to review the new cyber-related sanctions that were imposed on Russia at the end of December as they may impact existing business relationships with certain Russian individuals and entities. The new sanctions, enacted under Executive Order 13964, impact certain Russian government agencies, companies and individuals as a result of Russia’s cyber activities that were intended to influence the U.S. presidential election. Note that Executive Order 13964 was originally issued backed in April 2015, and authorized the imposition of sanctions for cyber-enabled malicious activities that:
- Harm or compromise the provision of services by entities in a critical infrastructure sector;
- Disrupt the availability of a computer or network or computers; or
- Cause a misappropriation of funds or economic resources, trade secrets, personal identifiers or financial information for commercial or competitive advantage or private financial gain.
Either in response to questions posed by U.S. companies, or in anticipation of the potential snap-back of secondary, nuclear-related sanctions on Iran by President Trump after the inauguration or by virtue of Iran’s recent announcement that the United States has violated the Joint Comprehensive Plan of Action (JCPOA), the Treasury Department’s Office of Foreign Assets Control (OFAC) posted guidance on its Frequently Asked Questions webpage as to what the reimposition of sanctions on Iran would likely entail.Read More
U.S. Immigration and Customs Enforcement (ICE) just issued a press release announcing the roll out of “Operation Surge Protector” that will target the illegal importation and distribution of counterfeit consumer electronics in the United States. These products, which include digital media devices, power adapters and consumer technology powered by lithium ion batteries, are highly susceptible to counterfeiting and pose health and safety hazards by overheating, igniting and causing severe injuries and property damage. Operation Surge Protector is being coordinated by the National Intellectual Property Rights Coordination Center or “IPR Center,” which uses the expertise of 23 partner government agencies, including the FBI and Homeland Security Investigations (HIS) to share information, coordinate enforcement actions and conduct investigations relating to IP theft. Operation Surge Protector will also provide additional resources to ICE agents, including the ability to more effectively track arrests, indictments and convictions. Assistant Attorney General Leslie Caldwell of the DOJ’s Criminal Division stated that the Justice Department will also continue to prosecute traffickers and manufacturers of counterfeit electronics “who choose profit over public health and safety.”Read More
Wait times and the number of cargo inspections performed at the border between the United States and Mexico for transportation security reasons are expected to drop significantly as U.S. Customs and Border Protection (CBP) and Mexico’s Servicio de Administration Tributaria (SAT) continue to expand the Unified Cargo Processing pilot at Arizona’s Port of Nogales.Read More
The Treasury Department recently published its quarterly list of countries that currently require participation or cooperation with an international boycott, such as the Arab League’s boycott of Israel. Even though many of these countries are WTO members and were required to shut down their Arab League offices as a condition of membership, many boycott-related requests are still being issued by government agencies and companies in these countries. The countries that are designated on this list, which by the way are the very same countries that were listed in the Third Quarter list, are: Iraq, Kuwait, Lebanon, Libya, Qatar, Saudi Arabia, Syria, United Arab Emirates, and Yemen.Read More
Yesterday, the new export Destination Control Statement requirements under the Export Administration Regulations (EAR) and the International Traffic in Arms Regulations (ITAR) went into effect which required U.S. exporters to make adjustments to their invoices, shipping documents, airway waybills, other documents, and their export compliance programs. Earlier this summer, the Commerce Department’s Bureau of Industry and Security (BIS) and the State Department’s Directorate of Defense Trade Controls (DDTC) harmonized the Destination Control Statement requirements under both the EAR and the ITAR. U.S. exporters are required to insert Destination Control Statements on commercial documentation to inform their foreign customers that they are receiving goods which are subject to U.S. law, and that any subsequent reexport or retransfer may require them to obtain prior authorization from the U.S. Government.Read More