Vol. 1213-2004

REGULATORY COMPLIANCE NEWSLETTER

NEWS:

The Department of State issued an interim rule on the International Traffic in Arms Regulations (ITAR) (22 CFR parts 122 and 129) by increasing the registration fees, changing the registration renewal period, and making other minor administrative changes. Effective Date: The interim rule took effect on December 8, 2004. Comment Date: The Department will accept written comments, which must be received no later than January 7, 2005.

Effective December 8, 2004, all new or renewing registrants must pay the increased annual registration fee of $1,750. Registrants may renew up to a maximum of two years. Registrants may refer to Federal Register (Vol. 69, No. 235) published on December 8, 2004, for detailed information on this ITAR revision (Federal Register Notice) or view the FR Notice on OCRViaNet.

Please note that the current paper Form DS-2032 has the old registration fee schedule, registrants are still required to pay the new registration fee. A revised form will be issued in the near future.

The Directorate of Defense Trade Controls is changing the registration code format. The registration code will now include a letter prefix M (designating a manufacturer and/or exporter) or K (designating a broker) before the registrant's four- or five-digit registration number (e.g., K-1234 or M12345). The code will no longer include a four-digit prefix containing the month and day on which the registration will expire. For example, the code prefix "1205," which indicates the registration expires on December 31, 2005, will be dropped from the registration code.

The Bureau of Industry and Security (BIS) issued a proposed rule and request for comments. On April 25, 1997, the United States ratified the Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons and on Their Destruction, also known as the Chemical Weapons Convention (CWC or Convention). The Bureau of Industry and Security (BIS) published an interim rule, on December 30, 1999, that established the Chemical Weapons Convention Regulations (CWCR) to implement the provisions of the CWC affecting U.S. industry and other U.S. persons. The CWCR include requirements to report certain activities, involving scheduled chemicals and unscheduled discrete organic chemicals, and to provide access for on-site verification by international inspectors of certain facilities and locations in the United States. The proposed rule revises the CWCR by updating them to include additional requirements identified in the implementation of the CWC and to clarify other CWC requirements. Date: Comments on this rule must be received January 6, 2005.

The Bureau of Industry and Security (BIS) issued a final rule that revises the criteria for determining if a foreign made item incorporating U.S. origin encryption is subject to the Export Administration Regulations; the notification requirements for beta test encryption software and certain ``publicly available'' encryption software; and the review and reporting requirements for exports and reexports of certain encryption items under License Exception ENC that are neither "publicly available'' nor eligible for "mass market'' treatment. It also makes technical changes. Effective Date: December 9, 2004.

The Office of Foreign Assets Control (OFAC), Department of Treasury announced major revisions to their watch list on December 8, 2004. A number of entities have been added in the notice and information on existing parties on the watch list has been updated with new addresses and branch offices.

The Alcohol and Tobacco Tax and Trade Bureau (TTB) issued a final rule that establishes the Southern Oregon viticultural area in portions of Douglas, Jackson, and Josephine Counties in southwestern Oregon. The established Applegate Valley, Rogue Valley, and Umpqua Valley viticultural areas are within boundaries of the Southern Oregon viticultural area. TTB designates viticultural areas to allow vintners to better describe the origin of their wines and to allow consumers to better identify wines they may purchase. Effective Date: February 7, 2005.

D-Trade

Developments—Several modifications are being made to the current electronic Form DSP-5, many of which will also be applied to other DSP application forms under development. The changes range from the “cosmetic” improvements and simple clarifications to substantive alterations to better address regulatory requirements and facilitate use. Upcoming changes include: Modification to the Applicant Statement; Relocate signature block at the end of the application; The ability to delete an entry from a continuation page; Expand Block 10 (Commodity Description) to 500 characters; Block 9, 10 and 12 will become required fields; Block 15 – Adding a Country pick list; Additional attachments, e.g., 126.13 Eligibility Letter, Transaction Exception Request, Firearms and Ammunitions Import Permit, Part 130 Report, Sec. 126.8 Prior Approval.

E-Registration—Electronic registration is expected to come online in 2005. The new form will accommodate new and renewal applications. Online payment will be made via Department of Treasury Pay.Gov system. Form of payment accepted: Automated Clearing House (ACH) Direct Debit; Credit Cards.

Technical Assistance Agreement (TAA) and Manufacturing Licensing Agreement (MLA)—The processing of TAAs via D-Trade was temporarily suspended in August 2004. This action was taken after a review of industry user comments. The design and development of an electronic form that allows for processing of both MLAs and TAAs is well under way. The new form includes features that will streamline industry submissions and will facilitate DDTC review. A separate announcement regarding its availability is expected to be announced shortly.

Electronic Issuance—In Early 2005, DDTC expects to implement electronic issuance of licenses for applications submitted via D-Trade. Applicants will be notified of final actions, via D-Trade status page, and advised how to retrieve the documentation electronically. No hardcopy documents will be mailed or be made available for pick-up for those cases.

DoD USXports—Due to DoD requests that industry create PDF text readable (“searchable PDF”) documents, DDTC strongly encourages the use of PDF text readable documents supporting documentation for the D-Trade electronic forms. With the initiation of electronic issuance of license, use of searchable PDF may become a requirement.

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

•      JAM'AT AL TAWHID WA'AL-JIHAD, AKA/DBA: a.k.a. AL-QAIDA GROUP OF JIHAD IN IRAQ; a.k.a. AL-QAIDA GROUP OF JIHAD IN THE LAND OF THE TWO RIVERS; a.k.a. AL-QAIDA IN IRAQ; a.k.a. AL-QAIDA IN MESOPOTAMIA; and other related aliases
  Privileges affected: Designated as Foreign Terrorists and Terrorist Organizations;
  Effective date: 12/06/04, Expiration date: UNTIL RESCINDED
  F.R. Date: 12/06/2004, Citation: 69 FR 70498
  

•      TOUR & MARKETING INTERNATIONAL LTD., Hotel Acuario, Suite 3542, Marina Hemingway, Santa Fe, Playa, CUBA, AKA/DBA: a.k.a. GO CUBA PLUS; a.k.a. T&M INTERNATIONAL LTD.; a.k.a. WWW.ABOUTCUBA.COM; a.k.a. WWW.BONJOURCUBA.COM; and other related aliases
  Effective date: 12/08/04, Expiration date: UNTIL RESCINDED

CONFERENCES:

OCR 2005 USER Conference

Title – “Using OCR Solutions Effectively”              
                                                                                                            Date: March 7, 2005, Time: 8:30 AM to 4:30 PM

The conference will focus on the latest updates from BIS and DDTC, Regulatory Requirements, and Highlights from Industry Experts who use OCR Solutions to meet Export/Import Compliance.

Venue: Hyatt Newporter, Newport Beach, California.
                                                                                        Registration: http://ocr.ocr-inc.com/request.asp

Hotel Accommodations:                               http://newporter.hyatt.com/property/index.jhtml

BIS Seminars

Title: Complying with U.S. Export Controls
Date: January 25-26, 2005
Location: Santa Clara, CA

Title: Complying with U.S. Export Controls
Date: February 9-10, 2005
Location: Manhattan Beach, CA

AAEI Seminar

Title: AAEI Annual Conference & Exhibition
Date: May 22-24, 2005
Location: New York, NY

American Conference Institute Seminars

Title: Mitigating Risk and Navigating Interdependencies in Defense Industry Compliance
Date: February 24 - 25, 2005
Location: The Westin Embassy Row, Washington, DC, United States

Title: Advanced Forum on Import Compliance
Date: February 28 - March 1, 2005
Location: The Four Seasons, Washington, D.C., United States

SUPPORT:

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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

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