Export Compliance Daily is providing readers with the top stories for March 1-5 in case you missed them. You can find any article by searching on the title or by clicking on the hyperlinked reference number.
The State Department’s Directorate of Defense Trade Controls issued guidance March 2 on how it will implement the increased export restrictions against Russia for the poisoning of opposition leader Alexei Navalny (see 2103020067). DDTC said it will amend the International Traffic in Arms Regulations to add Russia to the list of countries subject to a policy of denial for defense exports and services. That restriction will include certain exceptions, including a case-by-case review for exports that support “government space cooperation” and a six-month exception for exports that support “commercial space launches,” which will also be subject to a case-by-case review. DDTC said other exemptions will be provided for exports to Russia “when in furtherance of government space cooperation.”
The U.S. sanctioned a host of Russian officials and agencies, will add 14 entities to the Entity List and will increase restrictions on exports of military-related goods to Russia in response to the poisoning and imprisonment of Russian opposition leader Alexei Navalny. The increased export controls will also remove certain license exceptions for shipments to Russia and will impose stricter license review policies for certain sensitive goods, the State Department said March 2.
The State Department is expected to follow through with a rule that would permanently revise the International Traffic in Arms Regulations to allow employees involved in ITAR-related activity to work remotely. The rule, crafted under the Trump administration, was sent for interagency review in December but was withdrawn in January as part of the Biden administration's regulatory freeze on the previous administration’s pending regulations (see 2101210013).
The State Department’s Directorate of Defense Trade Controls’ Defense Export Control and Compliance System will be unavailable 6 a.m. to 8 a.m. EST Feb. 22 for maintenance, DDTC said. DDTC is encouraging users to make sure their work in progress is saved before the scheduled maintenance.
The Department of Defense is revising its process for identifying critical technologies that should be subject to export controls after the Government Accountability Office said its current process is too broad and lacks interagency coordination. Although the DOD is tasked with sharing a list of critical technologies with agencies that oversee export controls -- including the State, Commerce and Treasury departments -- officials at all three agencies said they sometimes don’t receive the list. None of the agencies received the list in 2019, the GAO said, even though it could have helped them better protect against trade theft and illegal exports.
The State Department withdrew a proposed rule that would have permanently amended the International Traffic in Arms Regulations to allow employees involved in ITAR-related activity to work remotely. The rule, which was sent for interagency review Dec. 3 (see c), was withdrawn Jan. 20, according to the Office of Information and Regulatory Affairs. The White House on Jan. 20 announced a withdrawal of pending rules issued by the previous administration to allow incoming officials to review and approve them. The State Department’s Directorate of Defense Trade Controls had considered making the telework change permanent because it proved popular with industry (see 2004240017, 2007280014 and 2012100009). A DDTC spokesperson declined to comment.
The State Department announced penalties on two foreign entities and one foreign official for illegal transfers under the Iran, North Korea and Syria Nonproliferation Act. The agency said the three transferred items subject to multilateral control lists that contribute to weapons proliferation or missile production, in a notice. The entities are China-based Ningbo Vet Energy Technology, Ningbo Zhongjun International Trade and their subsidiaries. Also sanctioned was Rim Ryong Nam, a North Korean official based in China and working for North Korea’s Munitions Industry Department. The two entities and the official are barred from purchasing items controlled on the U.S. Munitions List and by the Arms Export Control Act. The State Department also will suspend any current export licenses used by the entities and official and bar them from receiving new export licenses for any goods subject to the Export Administration Regulations. Government agencies are barred from entering into procurement contracts with them. The measures took effect Jan. 13.
The State Department updated its review policy for approving certain exports of precision-guided weapons to better ensure the items will not be used to harm civilians or abuse human rights. The change will affect license application reviews for direct commercial sales (DCS) of U.S. precision-guided munitions (PGM), the Directorate of Defense Trade Controls said this week, which will better align the review policy for DCS with the agency’s Foreign Military Sales (FMS) program.
The State Department should clarify to the Commerce Department that Electronic Export Information filings are not required for exports of certain licensed technical data controlled under the International Traffic in Arms Regulations, the American Association of Exporters and Importers said in a Jan. 8 letter. Even though the export of that data is authorized by an ITAR exemption and exempt from Automated Export System filings, the AAEI said “regulatory modifications made to support Single Window automation inadvertently” created uncertainty about whether AES filings are required. The uncertainty stemmed from the removal of language in the ITAR that “previously indicated no AES filing was required for such exports,” AAEI said. “This inconsistency causes confusion within industry, potentially impacts trade statistics, and may cost companies in business processing time,” the group said. AAEI urged the Directorate of Defense Trade Controls to clarify the filing requirement “either through issuance of an amendment” or “informally through coordination with” the Census Bureau. DDTC didn’t comment.