OCR Global Trade Brief – September 2023

United States-Taiwan Initiative on 21st-Century Trade First Agreement Implementation Act

 

President Biden signed into law H.R. 4004—the United States-Taiwan Initiative on 21st-Century Trade First Agreement Implementation Act.

 

The purpose of this Act is— 

 

(1) to approve and implement the Agreement between the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the United States regarding Trade between the United States of America and Taiwan, done on June 1, 2023;

 

 (2) to strengthen and develop economic relations between the United States and Taiwan for our mutual benefit;

 

 (3) to lay the foundation for further cooperation to expand and enhance the benefits of the Agreement; and

 

 (4) to establish transparency and consultation requirements with respect to Further Agreements.

 

Source: https://www.congress.gov/118/bills/hr4004/BILLS-118hr4004enr.pdf

 

 

Expansion of Nuclear Nonproliferation Controls on the People’s Republic of China and Macau

 

In response to the People’s Republic of China’s (China) military modernization efforts, military-civil fusion strategy, and expansion of its nuclear forces, the Bureau of Industry and Security (BIS) is amending the Export Administration Regulations (EAR) by adding additional nuclear nonproliferation controls on China and Macau. This change specifically applies to items controlled for Nuclear Nonproliferation (NP) column 2 reasons for control. These controls enhance U.S. Government efforts to monitor the export of these items and to ensure they are only being used in peaceful activities such as commercial nuclear power generation, medical developments, production of or use in medicine, and non-military industries.

 

Source: https://public-inspection.federalregister.gov/2023-17243.pdf

 

 

OFAC Settles with Construction Specialties Inc. for $660,594 Related to Apparent Violations of the Iranian Transactions and Sanctions Regulations

 

Construction Specialties Inc. (“CS”), a company headquartered in New Jersey that sells specialized building materials, has agreed to pay $660,594 to settle its subsidiary’s potential civil liability for three apparent violations of OFAC sanctions on Iran. The conduct at issue occurred when CS’s wholly controlled United Arab Emirates (UAE) subsidiary, Construction Specialties Middle East L.L.C. (“CSME”), imported building materials from the United States to the UAE and then knowingly reexported them to Iran. In doing so, CSME’s general manager and another senior manager disregarded CS company policy and falsified trade documents. The settlement amount reflects OFAC’s determination that CSME’s apparent violations were egregious and voluntarily self-disclosed.

 

Facts: CSME senior manager engaged in a pattern of behavior that concealed or obfuscated the destination of the goods from the U.S. suppliers. Among their deceptive acts, the senior managers falsified the ultimate destination of goods on seven purchase orders to the U.S. suppliers, omitted the ultimate destination on another purchase order, used a false project name to avoid linkage to Iran, and took steps to ensure that purchase of these U.S.-origin goods and their association with Iran would not be reflected in CSME records. CSME also removed labels denoting the U.S. origin of goods, and commingled U.S.-origin goods with goods produced by CSME in the UAE when they were sold to Iran, all in an effort to obfuscate the true country of origin.

 

Source: https://ofac.treasury.gov/media/932086/download?inline

 

 

With Wide-Ranging New Sanctions, Treasury Targets Russian Military-Linked Elites and Industrial Base

U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) is imposing nearly 100 sanctions on Russian elites and Russia’s industrial base, financial institutions, and technology suppliers as the United States continues to leverage sanctions and economic restrictions to undermine Russia’s capacity to wage its war against Ukraine. The Department of State also designated more than 70 persons. Today’s sanctions focus on persons benefiting from, supporting, and sustaining Russia’s brutal war of choice against Ukraine. 

 

“With today’s sanctions, the United States is continuing relentless work to target Russia’s military supply chains and deprive Putin of the equipment, technology, and services he needs to wage his barbaric war on Ukraine,” said Secretary of the Treasury Janet L. Yellen. “We have also made clear that those individuals and entities who profit from invasion and their proximity to the Kremlin will be held accountable, and today’s actions show our global reach in imposing severe costs on Putin’s oligarchs.”

 

 

Highlights:

 

OFAC continues its efforts to target Russian elites and firms that benefit from their ties to Russia’s defense sector, military-industrial complex, and affiliation with the Kremlin.

 

Today’s actions continue OFAC’s sustained efforts to target individuals and entities that enable—or attempt to enable—Russia’s ability to procure high-tech and dual-use goods.

 

The U.S. Department of the Treasury has repeatedly raised the issue of the shipment or transshipment of dual-use goods to Russia with the Government of Türkiye and the Turkish private sector. Today, OFAC is targeting two entities based in Türkiye.

 

On May 19, 2023, G7 Leaders committed to target those operating in Russia’s manufacturing and construction sectors. Today, OFAC underscores that commitment by sanctioning a number of leading Russian manufacturing and construction firms.

 

Today’s action also cuts into Russia’s revenue streams from extractive industries, including targeting entities that will contribute to Russia’s future energy revenues.

 

To continue restricting Russia’s ability to benefit from connections to the international financial system, OFAC is designating two more Russia-based banks as well as several Russia-based wealth management consulting, auditing, and investment firms.

 

Source: https://home.treasury.gov/news/press-releases/jy1731

 

 

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