Census Says FTR Final Rule 4-5 Months Away; BIS Discusses License Changes, Control Statements, Etc.
The Bureau of Industry and Security completed the second and final day of its Complying with U.S. Export Controls seminar in Washington, DC, May 8. At the two-day seminar, which is offered by BIS in several cities throughout the year, BIS and Census Bureau outreach and counseling staff provide an in-depth examination of the Export Administration Regulations (EAR).
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During the second day, BIS provided training on how it processes export license applications, the Office of Foreign Assets Control (OFAC) gave an overview of its trade-related sanctions and controls, Census provided a brief training on AES, BIS gave an overview of its export clearance requirements, an officer from BIS Export Enforcement explained how and why enforcement actions are taken, and BIS provided training on how to create an effective Export Management and Compliance Program (EMCP). Highlights follow:
Census hopes to publish FTR final rule in 4-5 months. Census said it hopes to publish its final rule revising the Foreign Trade Regulations (FTR) in 4-5 months. Currently, it says postdeparture filing requirements are the most important area of contention, and it is working with its partner agencies to reach a solution.
(At the March 6 meeting of the BIS Rules and Procedures Technical Advisory Committee, BIS and Census said that, under the revised FTR, exporters would no longer be able to file post-departure for items that require a BIS license; they also said it's “still in play” whether exporters would be able to file post-departure for items exported under license exceptions. See ITT's Online Archives 12032713 for summary.)
BIS to propose rule on non-material changes to licenses. BIS said it is in the process of revising its regulation governing the point at which changes to a transaction require a new license. According to BIS, a proposed rule has not yet been published because its Export Control Reform (ECR) rules are a higher priority. BIS said it hopes to publish the proposed rule for comment in the next year.
BIS will help exporters faced with government pressure to violate EAR. BIS noted that other government agencies and branches of the military may not understand that they are also subject to the requirements of the EAR. BIS said if an exporter is in a situation where a government agency or branch of the military is pressuring that exporter to perform a task that would be in violation of the EAR, then the exporter should contact BIS for help in resolving the issue.
Exporters wise to include ECCN even when not required. BIS said it is not required to include the Export Control Classification Number (ECCN) in the AES record for No License Required (NLR) exports for items controlled only for anti-terrorism (AT) or EAR99 items not listed on the Commerce Control List (CCL), but it advises exporters to include such information regardless. BIS said inclusion of the ECCN, even when not required, could prevent delays that result from questions regarding an item’s correct classification at the port.
Non-EAR Required Destination Control Statements. BIS said exporters will often add additional requirements to the Destination Control Statement that the EAR prescribes to appear on the invoice. Such additions to the Destination Control Statement are permissible, said BIS, but exporters should not tell their customers that these additional statements are required by the EAR. According to BIS, exporters should not tell untruths to their customers, but should simply say the additional statements form part of their compliance program.
OFAC says exporters should participate in screening. OFAC told exporters that, if the screening of potential customers is provided by a third-party, then the exporting company should have some involvement in order to effectively ensure that no violations are committed.
Upcoming seminars will be held by BIS on May 15-16 in Memphis, June 14-15 in Seattle, August 8-9 in Los Angeles, etc. BIS website with upcoming compliance seminars available here.