Regulatory intelligence for US exporters

Commerce Officials Hopeful About Progress on Routed Export Rule

After several years of delays, Commerce Department officials said industry may soon see progress on the agency’s long-awaited routed export rule. Although the rule is unlikely to be published this year, officials this week said they are hoping to prioritize the effort in the coming months, which could include major changes to the process around assigning filing responsibilities to forwarders and address information sharing among parties in routed export transactions (see 2006020049).

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“There has been more interest this year” around the routed rule than in “quite a while,” Hillary Hess, the Bureau of Industry and Security’s regulatory policy director, said during a Sept. 13 Regulations and Procedures Technical Advisory Committee meeting. The rule has been placed on hold several times over the past few years, including as BIS was tasked with implementing a host of Russia-related export controls after Moscow’s invasion of Ukraine in February (see 2206150033 and 2203160018).

“I'm not sure we still have time this year, just really mostly because of the pressure of all the other rules that we've had,” Hess said. “But there is a renewed interest in it, so I have hope for it.”

Officials at the Census Bureau, which is working closely with BIS on the rule, are just “starting to dig back into it,” said Kiesha Downs, chief of Census’ Foreign Trade Division’s regulations branch. Downs called it a “pretty in-depth rule,” partly because it affects both the BIS Export Administration Regulations and Census’ Federal Trade Regulations. “Because it has been off the table for so long, I think it will take us through this year anyway” to make progress, Downs said. “It does appear to be promising that we will have some movement on it.”

Downs also said Census is still evaluating whether to move forward with a rule that would require U.S. exporters of foreign-produced goods to declare the country of origin for their item in the Automated Export System (see 2112140033). The agency received mostly opposing public comments on the proposal, with several industry associations saying new requirements could lead to costly compliance challenges (see 2203160026 and 2201040044).

Census’ senior leadership is reviewing the rule and the comments, Downs said. “They're trying to determine the direction of this rule and the necessity of the information weighed against the burden that could be imposed on the trade.”

Census has also faced a setback in the rollout of a new online voluntary self-disclosure portal (see 2109150028). The portal, which the agency hoped to launch at the start of this year, is aimed at helping Census more efficiently review the large number of voluntary disclosures it receives. Downs said the agency “had a hang-up with the portal that we were developing” and is “trying to go a different route.”