Appeals Court Rules BIS Action Must be Heard in District Court
The Court of Appeals for the District of Columbia Circuit heard an exporter’s appeal of a Bureau of Industry and Security enforcement action, but ruled that while the Export Administration Act of 1979 (EAA) is lapsed because it has not been reauthorized by Congress, jurisdiction for such appeals passes to district court.
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Company was Charged with Violating Export Regulations
BIS charged Micei International, a Macedonian sporting goods and military supply company, with using an individual subject to a denial order to purchase items for export to Macedonia. The individual in question had previously lost export privileges as a result of being convicted for shipping stun guns abroad without a permit. BIS imposed a fine of $126,000 and a five year suspension of export privileges, in administrative enforcement proceedings in 2009.
BIS Thought Appeal Provisions of EAA Were Still in Effect
BIS informed Micei that it could appeal the order by petitioning BIS or appealing to the Court of Appeals for the District of Columbia Circuit, which Micei ultimately chose to do. BIS provided this guidance under the belief that the judicial review provisions of the EAA would still apply to the penalized firm’s appeal options.
EAA Enforced Under IEEPA Pending Reauthorization by Congress
The EAA expired on August 20, 2001, and Congress has not yet reenacted it. Prior to the Act’s expiration, the President issued an Executive Order directing the Bureau of Export Administration (now BIS) to enforce the EAA as if it were still “in full force and effect,” under the aegis of the International Emergency Economic Powers Act, or IEEPA. The court noted that the use of IEEPA to maintain the export regulations reflects a longstanding practice consistent with Congressional expectations.
Direct Review by Appellate Court not Available if Authorizing Statute has Lapsed
The court found that with the EAA lapsed, the appeal provisions in it are no longer in effect, and since the IEEPA defines no appeal recourse, the governing law by default is found in the Administrative Procedures Act (APA), which calls for appeals to be heard at in district court.
President Cannot Confer Jurisdiction under IEEPA
The court examined the question of whether the IEEPA allowed the President to “prolong the useful life of the lapsed EAA,” rather than merely order BIS to continue to enforce its provision. If such were the case, the court reasoned, the President would be conferring jurisdiction, an authority which the constitution reserves to Congress. Therefore, the court found that the President does not have the authority to confer jurisdiction, and the default jurisdiction of the APA is the correct venue for appealing the export violation enforcement action. The court therefore transferred the proceeding to the U.S. District Court for the District of Columbia.
(See ITT’s Online Archives or 08/17/10 news, 09081715, for BP summary of the President’s most recent extension of the EAA and certain provisions of the Arms Export Control Act.)
(CADC No. 09-1155, dated July 16, 2010)