The State Department’s Directorate of Defense Trade Controls will soon expand the types of defense articles and services that can be exported to Australia, the U.K. and Canada, including items and activities involving torpedoes, submarine combat control systems, acoustic countermeasure devices and night vision items. The measures were outlined in a final rule, released April 11 and effective May 12, that will also make “clarifying amendments and conforming updates” to the International Traffic in Arms Regulations.
The U.S. announced new measures against people and companies helping Russia evade sanctions, adding 28 entities to the Commerce Department’s Entity List and more than 50 new entries to the Treasury Department’s Specially Designated Nationals List. The Entity List additions, effective April 12, include companies in China, Armenia, Malta, Russia, Singapore, Spain, Syria, Turkey, the United Arab Emirates and Uzbekistan, all of which have supported Russia’s military or defense industrial base. New designations imposed by Treasury and the State Department target people and companies operating in Russia or that are aiding Moscow's war effort and its imports of “critical technologies."
China last week sanctioned the Hudson Institute think tank and the Ronald Reagan Presidential Library for hosting Taiwan's President Tsai Ing-wen. The two institutions let Tsai engage in political activities related to "Taiwan independence," which violated the one-China policy, China's Ministry of Foreign Affairs said, according to an unofficial translation. The restrictions bar Chinese universities, institutions and other organizations from cooperating with the sanctioned parties. In addition, several officials from the two groups were subjected to an asset freeze and travel ban.
Niloufar Bahadorifar, a U.S. citizen originally from Iran, was sentenced to four years in prison for conspiring to violate U.S. sanctions on Iran by providing financial services to the Iranian government and for structuring cash deposits, DOJ announced. The Irvine, California, resident was found guilty of conspiring to violate the International Emergency Economic Powers Act.
The Environmental Protection Agency released a final rule April 10 setting new significant new use rules (SNURs) under the Toxic Substances Control Act (TSCA) for 28 chemical substances subject to Premanufacture Notices (PMNs). As a result of the SNURs, persons planning to manufacture, import or process any of the chemical substances for an activity designated as a significant new use by this rule are required to notify EPA at least 90 days in advance. Importers of chemicals subject to these SNURs will need to certify their compliance with the SNUR requirements, and exporters of these chemical substances will now become subject to export notification requirements. The final rule takes effect June 12. The SNURs cover the following:
DOJ’s recent sanctions-related subpoenas of Credit Suisse Group and UBS Group are more evidence of the agency’s increasing “emphasis” on corporate enforcement, Rahman Ravelli said in an April 6 client alert. The agency launched a probe on both Swiss banks to examine whether they helped Russian oligarchs evade sanctions, Bloomberg reported last month, and Rahman Ravelli said the effort is part of a “wave of subpoenas” issued by DOJ in recent weeks.
Companies should be prepared for more “swift and persistent changes” to U.S. sanctions and export control regulations as the Biden administration continues to impose restrictions on Russia for its invasion of Ukraine, Barnes & Thornburg said in an April 4 client alert. The firm also said companies should prepare for U.S. government “inquiries into their transactions” even if they aren’t doing business in Russia or Belarus. “[T]hird-party intermediary risks are global,” it said. The Bureau of Industry and Society is one agency ramping up outreach to exporters amid a rise in new restrictions against Russia and China (see 2303240060).
The Treasury Department may be prioritizing enforcement of existing Russia sanctions rather than searching for new measures to impose, said Jay Shambaugh, Treasury’s undersecretary for international affairs. Shambaugh, speaking during an April 10 event hosted by the Brookings Institution, also said industry should expect the Biden administration to continue imposing national security-related trade restrictions on China.
David Vance Lucas, former head of Bradley Arant's international practice group, has joined Womble Bond as a partner in the Corporate and Securities Group, the firm announced. Lucas' practice will center on his experience providing advice on intellectual property, international trade and complex litigation matters, the firm said. Specifically, Lucas has worked on proceedings involving foreign direct investment, export controls and data protection throughout the U.S. and Europe and before the Committee on Foreign Investment in the U.S.
Companies should expect the U.S. to devote “higher budgets” and increase interagency coordination to bolster U.S. sanctions and export control enforcement, which could lead to “previously unseen” compliance risks, Orrick said in a recent client alert. The firm pointed to DOJ’s plans to hire new export control and sanctions prosecutors (see 2303070023), the administration’s new disruptive technology strike force (see 2303220037), the joint compliance alert earlier this year that outlines methods Russia uses to circumvent trade restrictions (see 2303020054), and more.