The Office of Information and Regulatory Affairs began an interagency review for a final Commerce Department rule that will implement certain export control decisions from the 2019 Wassenaar Arrangement plenary. OIRA received the rule June 9. Commerce officials said in May the agency was preparing to issue several emerging technology controls (see 2005190052), including six controls agreed to at Wassenaar. OIRA is still reviewing a rule to implement export control decisions from the 2018 Wassenaar Arrangement plenary (see 2005210046).
Companies operating in Hong Kong and mainland China should be reviewing their portfolios in preparation for increased U.S. export controls, which could impact a wide range of global firms, a Mayer Brown trade lawyer said. Aside from sanctions against Chinese officials for interference in Hong Kong’s autonomy, the U.S. is likely to align export control policies for Hong Kong with its policies toward mainland China, creating a significantly more restrictive trade environment, the lawyer said.
The Commerce Department announced a new rule that it said will help U.S. companies participate in international standard-setting bodies where Huawei is a member. Under the rule, companies will no longer need an export license to disclose technology to Huawei if that disclosure is for the “purpose of standards development in a standards-development body,” Commerce said in a June 15 press release. In addition, companies may only disclose technology to Huawei if that technology would not have required an export license before Huawei’s placement on the agency’s Entity List last year.
State-controlled and private Chinese buyers continue to purchase U.S. soybeans, despite growing tensions between the two countries (see 2005290047), Bloomberg reported June 10. Chinese companies purchased at least 10 cargoes of soybeans this month, Bloomberg said, which came after earlier reports that China was halting certain agricultural imports from the U.S., including soybeans, pork, corn and cotton (see 2006010044).
The U.S. is looking to seize a Waltham, Massachusetts, home from two people who allegedly used it to illegally export goods to several countries, including China, the Department of Justice said in a June 11 news release. Anni Beurklian, a naturalized citizen, and her husband, Antoine Ajaka, a Lebanese citizen and legal U.S. resident, used the home as a base for their company, Top Tech US Inc., which allegedly exported electronics and computer equipment illegally, DOJ said. Beurklian and Ajaka fled the U.S. in 2018 during plea negotiations to avoid prosecution, it said.
A Louisiana chemical manufacturer agreed to forfeit nearly $2 million for illegally exporting controlled chemicals, the Department of Justice said in a June 10 news release. Natural Advantage, controlled by Carol Callahan Byrne and Brian Byrne, distributed and exported more than 1,500 kilograms of controlled chemicals within the U.S. and worldwide without the required Drug Enforcement Administration registrations and despite DEA warnings, DOJ said. Company executives knew about the unlicensed sales and arranged to use other U.S. companies to sell the controlled List 1 chemicals -- including piperonal, heliotropine and phenylacetic acid -- to foreign customers.
President Donald Trump issued an executive order authorizing sanctions and visa restrictions against the International Criminal Court for “harassment” and “abuse” of officials of the U.S. government and its partner governments. The order, issued June 11, authorizes the State Department and the Treasury Department to sanction any person who works with the ICC to investigate, detain, arrest or prosecute any U.S. or partner government’s “personnel” without consent from that person’s national government. The order also authorizes sanctions against people who provide the ICC support, including the provision of goods and services. An ICC spokesperson said the court is aware of the sanctions and is still reviewing the order.
Oil tankers are steering clear of Venezuelan waters as the industry braces for a host of U.S. sanctions on ships operating in the Venezuelan oil sector, according to a June 9 Reuters report. Reuters previously reported the U.S. is preparing sanctions on dozens of foreign oil tankers for doing business with Venezuela, which could include designations on at least 40 ships. The move could lead to sharp increases in tanker rates and disrupt the global shipping industry, Reuters said.
The International Chamber of Commerce recently issued an addendum to its guidance on the use of sanctions clauses, urging banks to refrain from using or accepting sanctions clauses that impose extra restrictions on a deal. Broad sanctions clauses “defeat the independence principle in letters of credit and demand guarantees, the exclusively documentary nature of the instrument, and create uncertainty,” the ICC said in the May addendum.
The State Department may introduce more measures to help industry mitigate the impacts of the COVID-19 pandemic, including more license extensions or fee reductions, an agency official said. The agency is considering more measures after lowering certain fees and extending licensing deadlines in April (see 2004240017), which was received positively by companies, said Mike Miller, the State Department’s deputy assistant secretary for defense trade.