2001 – Export Compliance Training Institute

Archive for 2001

Prohibited Parties Lists Additions December 2001

2001/12/31

By: John Black

In the December 7, 2001 Federal Register, the Office of the Coordinator for Counterterrorism, Department of State designated 39 “Terrorist Organizations” under the USA PATRIOT Act. These organizations are:

– Al-Ittihad al-Islami (AIAI)
– Al-Wafa al-Igatha al Islamia
– Asbat al-Ansar
– Darkazanli Company
– Salafist Group for Call and Combat (GSPC)
– Islamic Army of Aden
– Libyan Islamic Fighting Group
– Makhtab al-Khidmat
– Al-Hamati Sweets Bakeries
– Al-Nur Honey Center
– Al-Rashid Trust
– Al-Shifa Honey Press for Industry and Commerce
– Jaysh-e-Mohammed
– Jamiat al-Ta’awun al-Islamiyya
– Alex Boncayao Brigade (ABB)
– Army for the Liberation of Rwanda (ALIR)
A.K.A. – Interahamwe, Former Armed Forces (EX-FAR)
– First of October Antifascist Resistance Group (GRAPO)
A.K.A. – Group de Resistencia Anti-Fascista Premero De Octubre
– Harakat ul Jihad I Islami (HUJI)
– Lashkar-e-Tayyiba (LT)
A.K.A. – Army of the Righteous
– The Lord’s Resistance Army (LRA)
– Continuity Irish Republican Army (CIRA)
A.K.A. – Continuity Army Council
– Orange Volunteers (OV)
– Red Hand Defenders (RHD)
– New People’s Army (NPA)
– People Against Gangsterism and Drugs (PAGAD)
– Revolutionary United Front (RUF)
– Al Ma’unah
– Jayshullah
– Black Star
– Anarchist Faction for Overthrow
– Red Brigades – Combatant Communist Party (BR-PCC)
– Revolutionary Proletarian Nucleus
– Turkish Hizballah
– Jerusalem Warriors
– Islamic Renewal and Reform Organization
– The Pentagaon Gang
(as far as we know, not AKA The McLaughlin Group)
– Japanese Red Army (JRA)
– TheAllied Democratic Forces (ADF)
– Jamiat ul-Mujahideen

In the December 21. 2001 Federal Register, the Bureau of Export Administration, Commerce removed two Russian entities from the Entity List. The two entities are:

– INOR Scientific Center
Moscow, Russia

– Polyus Scientific Production Association
3 Ulitsa Vvedenskogo, 117342
Moscow, Russia

These entities were placed on the Bureau’s Entity List for suspicion of engaging in activities involving weapons of mass destruction and missile technology on July 29, 1998. After an investigation, the State Department entities’ nonproliferation restrictions because of the remedial measures these entities have taken.

In the December 26, 2001 Federal Register, the Office of the Coordinator for Counterterrorism, within the Department of State designated the following groups foreign terrorist organizations. They are as follows:

– Jaish e-Mohammed
A.K.A. – the Army of Mohammed
A.K.A. – Mohammed’s Army
A.K.A. – Tehrik ul-Furqaan
– Lashkar e-Tayyiba
A.K.A. – the LT
A.K.A. – Lashkar e-Toiba
A.K.A. – Lashkar-I-Taiba
A.K.A. – Army of the Righteous

During December, the Office of Foreign Assets Controls placed several announcements on its web page adding quite a few parties to its various lists:

December 3, 2001, persons or organizations “Threatening International Stabilization Efforts in the Western Balkans”:

– Albanian National Army
A.K.A. – ANA
A.K.A. – AKSH
(active in the Balkans)

– National Committee for the Liberation and Protection of Albanian Lands
A.K.A. – KKCMTSH
(active in the Balkans)

December 4, 2001, Specifically Designated Global Terrorists (SDGT:

– Al-AQSA Islamic Bank
A.K.A. – Al-AQSA Al-Islami Bank
P.O. Box 3753
Al-Beireh, West Bank
Ramallah II 970
West Bank

– Beit El-Mal Holdings
A.K.A. – Arab Palestinian Beit El-Mal Company
A.K.A. – Beit Al Mal Holdings
A.K.A. – Beit El Mal Al-Phalastini Al-Arabi Al-Mushima Al-Aama Al-Mahaduda Ltd.
A.K.A. – Palestinian Arab Beit El Mal Corporation, Ltd.
P.O. Box 662
Ramallah, West Bank

– Hold Land Foundation for Relief and Development (F.K.A. – Occupied Land Fund)
with multiple addresses:
525 International Parkway, Suite 509
Richardson, Texas 75081, USA

P.O. Box 832390
Richardson, Texas 75083, USA

9250 S. Harlem Ave.
Bridgeview, Illinois, USA

345 E. Railway Ave.
Patterson, New Jersey 07503, USA
December 14, 2001, OFAC, under the USA Patriot Act of 2001, designated these entities as BPI-PA:

– Global Relief Foundation, Inc. with two addresses:
9935 S. 76th Ave., #1
Bridgeview, Illinois 60455, USA

P.O. Box 1406
Bridgeview, Illinois 60455, USA

– Benevolence International Foundation, Inc. with three addresses:
20-24 Branford Place, Suite 705
Newark, NJ 07102, USA

9838 S. Roberts Road, Suite 1-W
Palos Hills, Illinois 60465, USA

P.O. Box 548
Worth, Illinois 60482, USA

December 20, 2001, OFAC identified the following groups and individuals as Specially Designated Global Terrorists (SDGT:

– Lashkar E-Tayyiba
A.K.A. – Army of the Righteous
A.K.A. – Lashkar E-Toiba
A.K.A. – Lashkar-I-Taiba
Pakistan

– Mohammed Tufail
A.K.A. – S.M. Tufail
A.K.A. – Sheik Mohammed Tufail
(Pakistani National)

– Sultan Bashir-Ud-Din Mahmood
A.K.A. – Sultan Bashiruddin Mahmood
A.K.A. – Dr. Bashir Uddin Mehmood
A.K.A. – Sultan Baishiruddin Mekmud
D.O.B.: alt. 1937 – 1945
Street 13
Wazir Akbar Khan
Kabul, Afghanistan
(Pakistani national)

Ummah Tameer E-Nau (UTN)
Street 13
Wazir Akbar Khan
Kabul, Afghanistan

– Abdul Majeed
A.K.A. – Chaudnry Abdul Majeed
A.K.A. – Abdul Majid
D.O.B.: 15 Apr. 1939; alt. 1938
(Pakistani National)

December 26 2001, OFAC designated the following Specially Designated Global Terrorists (SDGT) as FTOs:

– Jaish-I-Mohammed
A.K.A. – Army of Mohammed
A.K.A. – Mohammed’s Army
A.K.A. – Tehrik Ul-Furqaan
(active in Pakistan)

– Lashkar E-Tayyiba
A.K.A. – Army of the Righteous
A.K.A. – Lashkar E-Toiba
A.K.A. – Lashkar-I-Taiba
(active in Pakistan)

December 26, 2001, OFAC amended the following SDGTs (designated on the 20th of December 2001) to include several new aliases:

– Ummah Tameer E-Nau (UTN)
A.K.A. – Foundation for Construction
A.K.A. – Nation Building
A.K.A. – Reconstruction Foundation
A.K.A. – Reconstruction of the Islamic Community
A.K.A. – Reconstruction of the Muslim Ummah
A.K.A. – Ummah Tameer I-Nau
A.K.A. – Ummah Tamir E-Nau
A.K.A. – Ummah Tamir I-Nau
A.K.A. – Ummat Tamir-I-Pau
Street 13
Wazir Akbar Khan
Kabul, Afghanistan

60-C
Nazim Ud Din Road
Islamabad F 8/4, Pakistan

December 31, 2001, OFAC added these parties to its SDGT list:

– Continuity IRA (CIRA)
(active in the United Kingdom)

– Orange Volunteers
(active in the United Kingdom)
– First of October Antifascist Resistance Group (GRAPO)
(active in Spain
– Ulster Defence(sic) Association
A.K.A. – Ulster Freedom Fighters
(active in the United Kingdom)
– Loyalist Volunteer Force (LVF)
(active in the United Kingdom)
– Red Hand Defenders (RHD)
(active in the United Kingdom)

Posted in USA Regulations

State Department Relaxes License Approval Policy for Indonesia

2001/12/30

By: John Black

In the December 18, 2001 Federal Register the he Office of Defense Trade Controls (ODTC) in the State Department has announced a new license review policy for Indonesia. Under the new policy, ODTC will review license/agreement request for the following on a case-by-case basis.

Non-lethal defense articles and spare parts
Non-lethal, safety-of-use spare parts for lethal end items.

ODTC said that examples of safety-of-use spares for lethal end items would include cartridge actuated devices, propellant actuated devices, and technical manuals for military aircraft for purposes of enhancing the safety of the aircraft crew.

ODTC defines “non-lethal defense articles” as “an article that is not a weapon, ammunition or other equipment or material that is designed to inflict serious bodily harm of death.”

In October 1999, ODTC suspended all licenses and approvals for Indonesia except for certain commercial communication satellites and Y2K activities not destined for the military in response to the unrest in the country. ODTC relaxed this policy twice in 2001: In January it announced a policy of case-by-case review for spare parts for C-130 aircraft and in March it announced a case-by-case review policy for items exported to Indonesia for ultimate end-use in a third country.

By implementing a “case-by-case review” policy, ODTC is saying that it will not automatically deny licenses, but will review them on their merits.

ODTC gave no reason for relaxing its Indonesia policy, but we suspect the new policy is a reward for Indonesia’s cooperation in the aftermath of the September 11 attack-a reward we predicted in our newsletter in September.

Posted in Aerospace, Defense Trade Controls, Export License, Indonesia, Telecommunication, USA Regulations

Compliance Tip: Subcontractor Must Be Listed in ITAR Applications

2001/12/30

By: John Black

Over the years exporters occasionally run into sections of the International Traffic in Arms Regulations (ITAR) that are confusing or unclear. Often times exporters end up interpreting such sections differently that the Office of Defense Trade Controls (ODTC). Because ODTC is responsible for administering the ITAR, the safe course is for exporters to use ODTC interpretations.

One important example of a sometimes misunderstood ITAR section is 124.13, which is the offshore procurement agreement rules. An exporter submits a DSP-5 application to send build-to-print drawings and specifications to a foreign manufacturer who will produce a defense article. ITAR 124.13 and the ODTC provisos on an approved offshore procurement DSP-5 require that the contract between the US exporter and the overseas party (“licensee”) include certain terms and conditions. The language in the ITAR as referenced in the provisos often causes exporters to mistakenly assume that the foreign licensee may share the US tech data with any subcontractors located in the same country as the foreign licensee, even if the subcontractors were not mentioned in the DSP-5 application.

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Posted in DDTC, Defense Trade Controls, Export License, ITAR

Census Quietly Announces Proposals for Mandatory Electronic SED Filing

2001/12/30

By: John Black

In the December 28, 2001 Federal Register the Census Bureau announced further details on its upcoming plans to require that all Shipper’s Export Declarations for items on the US Munitions List (USML) or Commerce Control List (CCL) be submitted electronically using the Automated Export System (AES). The notice describes new data elements that will be added to the electronic SED for items on the USML and a change for the paper SED. The notice is not actually new proposed regulations, but is just a request for comments on a proposed information collection. (For those of you outside of the beltway, there are hundreds, if not thousands, of government employees involved in publishing requests for comments on “information collections” and “proposed information collections” for any and every US Government form, application, etc. Think of them the next time you pay your taxes.) Eventually Census will publish regulations implementing mandatory AES and the regulations will be more detailed that the information collection notice.

When AES becomes mandatory is a critical question for exporters who will have to switch to AES. In the Federal Register notice Census did not say when AES will be mandatory, but Census officials have publicly said that they expect to miss the March 2002 target deadline announced last year. In fact, Census officials have speculated that mandatory AES will not happen until the fall of 2002 at the earliest.

The new paper SED will include a field for the forwarding agents Employer Identification Number.

The new AES electronic SED will include these new data fields for USML items:

PM/DTC registration code
Yes/No check box to indicate whether item is Significant Military Equipment
Yes/No check box for ODTC eligible party certification
USML Category
USML unit of measure
USML ;unit of quantity
ODTC export license line number

The above items will not be added to paper SEDs because once this is implemented, you no longer will be allowed to use paper SEDs for USML items.

What obviously is missing is details on how mandatory AES will effect the process and documentation requirements for clearing USML shipments through US Customs. We can only hope that the State Department or Census will give exporters guidance on export clearance for USML items before AES becomes mandatory. But don’t blast State yet because you fear it might be slow in issuing guidance. According to Census officials, you first might want to thank State Department for the mandatory AES implementation missing its original March 2001 target implementation date. Census officials have cited the State Department for being particularly slow in giving its input on mandatory AES and indirectly pointed to State as a big contributor to the delays.

AES is already available for exporters to use. You may either use www.aesdirect.com or integrate AES (using third party or in-house software) into your own computer system.

The driving force for mandatory AES is the Security and Assistance Act of 1999. This law, however, does not require mandatory AES for items classified as EAR99 or “public domain”/”publicly available” technical data and software. Your Congress, however, is working hard to draft new legislation to make AES mandatory for everything not covered by the existing law.

Posted in AES, Federal Register, SED

Bush Announces Upcoming Computer Relaxations

2001/12/28

By: John Black

Computer manufacturers and computer users who export computers will benefit from one of President Bush’s first policy changes of 2002. The Administration announced that it will soon raise the current Composite Theoretical Performance (CTP) license threshold for computer exports to “Tier 3” countries, from 85,000 MTOPS (Millions of Theoretical Operations Per Second) to 195,000 MTOPS. Computer systems with CTP speeds lower than the new ceiling do not require export licensing from the United States Government.

Countries classified as “Tier 3” include India, Pakistan, and Vietnam. The announced policy will not enter into force until the Commerce Department revises the Export Administration Regulations. The new policy does not effect “Tier 1” countries such as Japan, Mexico, and the United Kingdom. Computer exports to such countries already do not require an export license. The new policy also does not effect exports to embargoed and terrorist countries.

The President’s decision does not concern single-processor, personal computers. To put a processor with a CTP of 195,000 MTOPS in perspective, the fastest Pentiumâ 4 Processor operates at 2.0 GHz with a CTP of only 5333.333 MTOPS. When the new policy is implemented, systems with much higher CTPs, such as Sun Microsystems’ multiprocessor UltraSPARC III+ (which has a CTP speed of 85,961) will no be subject to export licensing.

Posted in Information Technology

Commerce Department Enforcement Update

2001/11/30

By: John Black

Ever wonder how to respond to the renegade salesman or engineer who asks why they should comply and what happens if they violate the rules? The Commerce Department has given you a few extremely concrete answers to such questions in the form of recent enforcement actions it has taken. So, now you can answer, “Well Joe, I am not sure what would happen to us if we violate, but McDonnell Douglas got fined $2.12 million for its exports of used machine tools. I’m not saying that would happen to us if we violate the rules-maybe we’d be lucky and only get hit with a $496,000 fine similar to the fine Entegris, Inc. got for some illegal exports of commercial valves and components.”

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Posted in Violations & Fines

Prohibited Parties Lists Additions November 2001

2001/11/30

By: John Black

Denied Persons List

In the November 20, 2001 Federal Register, the Commerce Department announced and Administrative Law Judge had upheld Commerce’s September 6, 2001 order adding the following party to its Denied Persons List:

Tetrabal Corporation, Inc., 605 Trail Lake Drive, Richardson, Texas 75081 and Ihsan Medhat “Sammy” Elashi, 316 Candlewood Place, Richardson, Texas 75081

Tetrabal, a computer reseller, was added to the denial list because it is related to Infocom. Infocom is an Internet service provider who was added to the denial list because it illegally exported computers to Libya and Syria.

Posted in USA Regulations

State Department Announces Additional Delivery and Pick-up Services

2001/11/30

By: John Black

The Office of Defense Trade Controls (ODTC) in the State Department has announced new guidelines and procedures for deliveries and pick-ups. First, to send an application or other correspondence to ODTC, you must use “established commercial carriers” such as FedEx, DHL, UPS, and Airborne Express. When using one of the “established commercial carriers,” the return address on the package must include the return address plus the name and telephone number of an “empowered official” as defined by the International Traffic in Arms Regulations. ODTC will not accept deliveries using any other methods (e.g., US Postal Service) or procedures.

ODTC has resumed sending outgoing mail including approved licenses, agreements and registrations and other documents. ODTC is using the US Postal Service and, when the exporter includes a prepaid airway bill with its application, commercial carriers.

“Known” representatives of US defense companies, their consultants and attorneys, and local embassy officers with access privileges to ODTC may resume pick-up and delivery on the 12 and 13th floors. Other representatives known to ODTC but not having access privileges must contact ODTC to make arrangements for delivery and pick-up.

Posted in DDTC, Export License

Revisions to Office of Foreign Assets Control Lists

2001/11/15

By: John Black

In the November 15, 2001 Federal Register the Office of Foreign Assets Control (OFAC) published an assortment of changes to its lists of specially designated narcotics traffickers, foreign terrorist organizations, specially designated nationals and blocked persons. OFAC added thousands of names to its lists, deleted all with the FRYK designation, and deleted two names from its Weapons of Mass Destruction list. Rather than reprinting the thousands of new names and changes here, we will simply direct you to the OFAC web site with all of the newly revised and updated lists: http://www.treas.gov/ofac/t11sdn.pdf and the OFAC web site that identifies all of the changes that have been made: http://www.treas.gov/ofac/t11sdnew.pdf.

Posted in OFAC

Prohibited Parties Lists Additions October 2001

2001/10/30

By: John Black

Terrorist Organizations

In the October 26, 2001 Federal Register, the Office of Foreign Assets Control of the Treasury Department published a notice expanding its list of terrorists and terrorist organizations.

In the October 25, 2001 Federal Register, the State Department’s Coordinator for Counterterrorism published a notice designating/redesignating terrorist organizations.

As anyone with experience with US regulations would expect, the Treasury and State Department lists are not identical.

Posted in USA Regulations