Vol. 0902-2005

REGULATORY COMPLIANCE NEWSLETTER

NEWS:

The Bureau of Industry and Security (BIS) issued a final rule that implements two steps the United States has agreed to take as part of the final phase of NSSP, namely, the removal of license requirements for exports and reexports of items controlled unilaterally by the United States for nuclear nonproliferation reasons to India and the removal of six Indian entities from the Entity List. Effective Date: August 30, 2005.

The Department of State (DOS) issued a final rule that amended the International Traffic in Arms Regulations (ITAR) by modifying the denial policy regarding the Democratic Republic of the Congo (DRC) at 22 CFR 126.1. The action was taken in accordance with UN Security Council Resolution (UNSCR) 1596, unanimously adopted on April 18, 2005, which imposed a nation-wide embargo on arms sales or transfers to any recipient in the DRC. It represents an expansion of the policy issued under UNSCR 1493, which on July 28, 2003, imposed an embargo on the sale of arms, related materials, and defense services in the provinces of North and South Kivu and the Ituri District in the DRC. Effective Date: August 29, 2005.

The Department of State (DOS) issued a final rule that amended the definition of ``District Director of Customs'' to reflect the change in title. Also, references to the Customs Service have been changed to the U.S. Customs and Border Protection. A definition was been added for the ``North Atlantic Treaty Organization'' and another definition for ``major non-NATO ally.'' The recordkeeping requirement was revised to include maintaining records in an electronic format and reproduction of readable documents. No need for multiple copies of supporting documentation for electronic license applications. Also, registration documents are not releasable to the public. Effective Date: August 29, 2005.

The U.S. Customs and Border Protection (CBP) issued a proposed rule to amend the Department of Homeland Security regulations pertaining to the field organization of the Bureau of Customs and Border Protection by establishing a new port of entry at Sacramento , California , and terminating the user fee status of Sacramento International Airport . In order to accommodate this new port of entry, the rule proposes to realign the port boundaries of the port of entry at San Francisco , California since these boundaries currently encompass an area that is to be included within the new port of Sacramento . The change is part of the Bureau of Customs and Border Protection's continuing program to utilize more efficiently its personnel, facilities, and resources to provide better service to carriers, importers, and the general public. Comments must be received on or before November 1, 2005.

DEFENSE TRADE CONTROL – Notice on License Support Documentation

Section 123.1(c)(4) of the International Traffic in Arms Regulations (ITAR) establishes that the Directorate of Defense Trade Controls (DDTC) may require all pertinent documentary information in order to consider the issuance of a license or other approval. Consistent with our longstanding practice, in addition to requiring a purchase order, letter of intent, or other documentation, DDTC's Office of Defense Trade Controls Licensing (DTCL) may require a signed contract to be submitted with any application for the permanent export of defense articles.

The purpose of the requirement is to confirm the legitimacy of the transaction, including the roles and responsibilities of all the parties. DTCL has received with increasing frequency supporting documentation that calls into question whether the applicants are in a position to fulfill their responsibilities as registered exporters and, in fact, whether anyone at the companies could meet the obligations as empowered officials under Section 120.25. In these instances, the applications have been Returned Without Action advising the applicants of the ITAR requirements.

The purchase documentation must be from the foreign party purchasing the defense articles. The purchase documentation cannot be from its U.S. subsidiary since the latter entity is considered a U.S. person under the ITAR. The purchase order must be addressed and directed to the registered U.S. party selling the defense articles and submitting the export license application. This ensures that the applicant is in a contractual position to fulfill all responsibilities of registered parties under the ITAR, including being knowledgeable of all elements of the transaction. The documentation may contain references to other parties and their roles (e.g., suppliers, manufacturers, freight forwarders), but at a minimum must specifically explain the role of the party submitting the license application.

All applications submitted after September 16, 2005, not in compliance with this requirement will be Returned Without Action. In the interim, DTCL will consider applications on a case-by-case basis and determine whether they may be approved pending full implementation of this requirement.

COMMITTEE FOR THE IMPLEMENTATION OF TEXTILE AGREEMENTS ANNOUNCED CHINA SAFEGUARD DECISIONS

The Committee for the Implementation of Textile Agreements (CITA) announced affirmative decisions in two textile safeguard cases.

CITA determined that the U.S. market for other synthetic filament fabric (category 620) and brassieres and other body-supporting garments (category 349/649) is being disrupted and that there is a threat of further disruption. CITA further determined that the imports in these categories from China play a significant role in the existence and threat of market disruption, and that this situation threatens to impede the orderly development of trade in these products. As a result of these determinations, CITA has requested consultations with the Government of China on these products and has put in place quotas that will limit the growth in imports of the covered products.

"Today's announcement demonstrates this Administration's commitment to leveling the playing field for U.S. industries by enforcing our trade agreements," said Commerce Deputy Assistant Secretary Jim Leonard. "We will continue to consult with the Chinese government to find a solution that will permit the orderly development of textile and apparel trade."

CITA also announced that it is extending until October 1, 2005 , the period for making a determination on whether to request consultations with China regarding imports of cotton and man-made fiber sweaters (category 345/645/646), cotton and man-made fiber dressing gowns and robes (category 350/650), men’s and boys’ wool trousers (category 447), and knit fabric (category 222). CITA will continue to evaluate the market conditions for these four categories.

CITA's decision to invoke safeguards on imports of these Chinese origin textile and apparel products that are contributing to the disruption of the U.S. market is in accordance with the textile safeguard provision in China 's Accession Agreement to the World Trade Organization.

SPECIAL CUSTOMER UPDATE: OCR Web Site

A new and improved content website of OCR Services will be rolled out in the next few weeks. The new web layout will provide customer access to more information on OCR’s product and services, improve client access to customer support services and provide abilities for customers to request training and other services online. Clients will get access to an expanded compliance library, which provides information on regulatory updates with legal articles on their impact on the industry. Look for more details in the coming weeks…

DENIED PERSON UPDATE:

The following entities were added to the Denied Persons List .The full list of changes can be accessed at the OCR web site

• *ENTIRE COUNTRY*
  CONGO, THE DEMOCRATIC REPUBLIC OF THE
  Privileges affected: This rule amends the International Traffic in Arms Regulations (ITAR) by modifying the denial policy regarding the Democratic Republic of the Congo (DRC) at 22 CFR 126.1. This action is taken in accordance with UN Security Council Resolution (UNSCR) 1596, unanimously adopted on April 18, 2005, which imposed a nation-wide embargo on arms sales or transfers to any recipient in the DRC.(70 FR 50966). It represents an expansion of the policy issued under UNSCR 1493, which on July 28, 2003, imposed an embargo on the sale of arms, related materials, and defense services in the provinces of North and South Kivu and the Ituri District in the DRC. Waiving Prohibition on United States Military Assistance with Respect to the Republic of the Congo.(08-13-2004). Deny licenses, other approvals, exports or imports of defense articles and defense services destined for or originating in the Democratic Republic of the Congo except for non-lethal equipment and training (lethal and non-lethal) to the United Nations Organization Mission in the Democratic Republic of the Congo (MONUC), and the transitional National Unity Government of the Democratic Republic of the Congo, and the integrated Congolese national army and police forces, and humanitarian or protective use, and related assistance and training as notified in advance to the UN. An arms embargo exists with respect to all foreign and Congolese armed groups and militias operating in the territory of North and South Kivu and of Ituri, and to groups not party to the Global and All-inclusive Agreement, in the Democratic Republic of the Congo (Amendment to ITAR 126.1) (69FR7349)
  Effective date: 04/04/94, Expiration date: UNTIL RESCINDED
  F.R. Date: 08/13/2004, Citation: 59 FR 15624; 58 FR 26024; 61 FR 36625; 69 FR 7349; 69 FR 50049; 70 FR 50966

• Dhamat Houmet Daawa Salafia, AKA/DBA: a.k.a. Group Protectors of Salafist Preaching; a.k.a. Houmat Ed Daawa Es Salifiya; a.k.a. Katibat El Ahoual; a.k.a. Protectors of the Salafist Predication; a.k.a. El-Ahoual Battalion; a.k.a. Katibat El Ahouel; a.k.a. Houmate Ed-Daawa Es-Salafia; a.k.a. the Horror Squadron; a.k.a. Djamaat Houmat Eddawa Essalafia; a.k.a. Djamaatt Houmat Ed Daawa Es Salafiya; a.k.a. Salafist Call Protectors; a.k.a. Djamaat Houmat Ed Daawa Es Salafiya; a.k.a. Houmate el Da'awaa es-Salafiyya; a.k.a. Protectors of the Salafist Call; a.k.a. Houmat ed-Daaoua es-Salafia; a.k.a. Group of Supporters of the Salafiste Trend; a.k.a. Group of Supporters of the Salafist Trend
  Effective date: 10/20/03, Expiration date: UNTIL RESCINDED
  F.R. Date: 10/20/2003, Citation: 68 FR 59977

• Elyazgi, Najmeddin A., Okba Air Base, Tripol , LIBYA , AKA/DBA: a.k.a. Col ; a.k.a. Capt. Elyazgi; a.k.a. Sulyak, Nedim; a.k.a. Malsom, Donald
  Effective date: 01/10/84, Expiration date: UNTIL RESCINDED
  F.R. Date: 01/17/1984

CONFERENCES:

BIS Seminars

Title: Essentials of Export Controls
Date: September 8, 2005
Location: Washington , DC

Title: Intermediate License Exceptions
Date: September 9, 2005
Location: Washington , DC

Title: Update 2005 Conference on Export Controls and Policy
Date: October 24-25, 2005
Location: Renaissance Hotel, Washington DC .

Title: Update 2005
Date: October 24 - 25, 2005
Location: Washington , D.C.

SIA Seminar

Title: Fall Advanced Conference
Date: November 7-8, 2005
Location: Washington , DC

SUPPORT:

For support with OCRviaNet or EASE Solution, please call (East Coast) 1-800-333-7864 or (West Coast) 1-888-858-2224.

Disclaimer:

This newsletter is not intended to provide legal guidance. Adherence to this decision does not relieve the exporter of the statutory responsibilities of complying with the applicable statutes, regulations, policies and procedures of the U.S. Government

Register for Email Updates:

Sign up for the newsletter and regulatory updates by registering on OCR Services website at www.ocr-inc.com This is a free service for OCRViaNet and EASE product users.

Remove From Mailer: