China’s latest export control compliance guidelines closely mirror U.S. guidance and provide significant new insight into how the country will interpret its export control law (ECL) (see 2011030033 and 2010190033), law firms said. Companies operating in China may find that their U.S. compliance programs translate well to China’s rules, the firms said, which now include guidance for risk assessments, reporting procedures and audits.
New European Union export controls on dual-use goods meant to promote human rights have the effect of shifting legislative authority from a member state's legislative body to its regulatory arm, Sheppard Mullin said in a May 14 analysis. Officially passed on March 26, the human rights export controls allow, among other things, a member state to impose a prohibition on the exports of items not on the Dual-Use Control List for human rights considerations. Subsequently, other member states are also prohibited from making unlicensed exports of these items if they have been notified by the appropriate competent authorities that the items are intended to be used for human rights violations. “In Member States whose legislation does not empower their licensing authorities unilaterally to impose export licensing requirements on new items, the Regulation effectively transfers legislative authority from one organ of Member State government (the legislature) to another (the export licensing authority),” Sheppard Mullin said.
The Office of Foreign Assets Control sanctioned three people and one entity for helping the Islamic State of Iraq and Syria group access financial systems in the Middle East, a May 17 news release said. The sanctions target Alaa Khanfurah for transferring funds to ISIS through his Turkey-based money service business, Idris Ali Awad al-Fay for using the sanctioned Turkey-based Al-Fay Company to help distribute currency for ISIS, and Ibrahim Ali Awad al-Fay for owning the Al-Fay Co.
The Office of Foreign Assets Control sanctioned 16 people and one entity connected to Myanmar’s military, which is committing human rights violations after overthrowing the country’s government earlier this year, the agency said May 17. The designations target 13 “key members” of the Myanmar military, three adult children of previously designated military officials and the State Administration Council (SAC), which was created by the military to support its overthrow of the government.
The Bureau of Industry and Security issued more than $100,000 in combined penalties against two companies for illegally exporting thousands of dollars worth of goods to Iran, Russia and Ukraine. BIS imposed a $60,000 fine and temporarily denied the export privileges for Kleiss & Co., a Netherlands-based company that BIS said illegally shipped “extruded butyl sealants” from the U.S. to Iran. The agency also fined Texas-based TeleDynamics $55,000 for illegally exporting rifle scopes from the U.S. to Russia and Ukraine.
More than 40 Republican lawmakers urged President Joe Biden to refrain from providing sanctions relief to Iran, saying that nation is supporting “terrorist activity” against Israel. The senators -- including Jim Risch of Idaho, the top Republican on the Senate Foreign Relations Committee -- said Iran is supporting “Palestinian terrorists” in Gaza and has encouraged the group to attack Israel amid the ongoing conflict between the two sides.
The Office of Foreign Assets Control amended its Narcotics Trafficking Sanctions Regulations and the Foreign Narcotics Kingpin Sanctions Regulations to add and revise general licenses, prohibitions, definitions and technical changes, the agency said in a notice released May 14. The final rule, effective May 17, will revise several general licenses related to payments for “legal services,” certain transactions for “maintenance of blocked tangible property” and emergency medical services, which will be subject to new recordkeeping requirements. The agency also revised definitions for “foreign person” and “specially designated narcotics trafficker,” updated certain “regulatory provisions” in the sanctions language, and made other conforming changes.
The U.S. issued guidance last week to address industry uncertainty and a rising number of questions about export licensing jurisdiction for goods sent under its Foreign Military Sales Program. The guidance -- which includes frequently asked questions developed by Homeland Security, CBP and the Commerce, State and Defense departments -- was issued because the agencies “continue to receive questions” about exports that were moved from the U.S. Munitions List to the Commerce Control List but are exported under FMS authority. They said exporters are “having difficulty” understanding how Commerce’s Export Administration Regulations, the State Department’s International Traffic in Arms Regulations and the FMS Program “relate to each other” for goods that have recently transitioned from the ITAR to the EAR.
Alvarez & Marsal Taxand hired Michael McGee to lead the consultancy's new Global Trade and Customs practice, it said in a May 12 news release. McGee was previously the global director of International Trade Regulations at BP America. “The political landscape and the pandemic have led to more regulations, increasingly complex tax regimes and the need to redraw supply chains. As a result, there is greater demand for expert tax advisory services, including for global trade and tariffs and duties,” said Ernesto Perez, managing director of the Houston firm. “In line with A&M’s leadership, action, results approach, A&M Taxand is responding to the shifting business environment by expanding and strengthening specialized tax services to maximize value for clients.” A&M said McGee has “expert knowledge of U.S. Customs Law, Department of Commerce Export Administration Regulations, Department of Treasury Office of Foreign Asset Control, and Department of Commerce Antiboycott Regulations.”
European individuals and entities should not be allowed to cancel contracts with entities in Iran, or other countries sanctioned by third parties, solely on the basis of seeking to avoid third party sanctions on that nation, a legal adviser to the Court of Justice of the European Union said in a May 12 opinion. Advocate General Gerard Hogan said in the non-binding opinion that a German company's decision to cut ties with an Iranian bank could be met by a European blocking statute that was passed to counter U.S. sanctions and to ensure that the bloc does not recognize any court ruling that enforces American penalties.