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The Export Controls & Sanction Manager - Edition 6

Edition 6 - 2024 - Week 7 of your blog-style magazine on export controls & sanctions.

The period we covered was 08.02.2024 - 13.02.02.2024 - Free Version (links behind paywall)


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Executive Summary

The UK has published extensive and various new guidance on sanctions; this is an essential read for any export control and sanctions professional.


Over to the EU, where France has published autonomous Dual Use controls under the EU Dual Use Regulation. We have the details and show you what other EU Member States are doing.


The U.S. details how a Russian-Canadian national pleaded guilty to conspiracy to launder money from a scheme to send UAV and missile components to Russia in violation of US sanction, seized an Iranian Aircraft, issued and OFAC determination on Diamonds trade from Russia and sanctioned Ecuador’s notorious Los Choneros gang and its leaders. Also, did you see the change in U.S. Export control as regards Belarus, Russia and Iran?


We would like to remind you of our events this week:


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For a weekly wrap up of all the changes in these editions, join our Weekly Wrap Up, our live community meet every Friday at 12pm. Register to take part here for free. This is followed by a "Lunch N Learn" and you can register here. The focus is on "Sanctions - U.S. and EU". Finally, our free Webinar "Two Years Of War In Europe: EU and UK Sanctions Against Russia in FOCUS" will take place on the 26thm next week. Register here for free, here.


Have a captivating lecture! Any questions? Any feedback? Please don't hesitate to reach out to us at info@customsmanager.org via Email.


See you live online, Friday.


Arne



Content



U.S. Export Controls

EU Export Controls

UK Export Controls


Sanctions Updates

EU Sanctions

UK Sanctions

U.S. Sanctions




Unlock all exclusive posts and make sure you stay fully up-to-date. Access Our NEW FAQ to answer all your questions: https://www.customsmanager.info/plans-pricing



Due Diligence & AML


Ensuring Trade Compliance in Third-Party Transactions: Best Practices for Due Diligence

Are You Doing Enough? Best Practices for Ensuring Trade Compliance in Third-Party Transactions -



Export Controls Updates

To make sure you never miss an export control update, bookmark https://www.customsmanager.info/all-news/categories/export-controls


⇒ EU Export Controls


France published its list of dual-use items


France has restricted the export of advanced electrical components and quantum computing technologies due to a growing danger at the intersection of geopolitics and technology. Since quantum computing can completely transform several sectors, including the financial markets and military defence systems, the stakes are very high.


France is using Article 9 of the EU Dual-Use Regulation, which enables .... read more




What are other EU nations doing? Overview

 The EU's flexibility is shown by Article 9, which permits member states to adapt restrictions for dual-use commodities and ensures that they are utilised for the good of humanity rather than its damage. More harmonisation of regulatory frameworks throughout EU Member states is required to preserve uniformity and reduce the likelihood that exporters would choose the least restrictive jurisdiction (forum shopping). In particular...read more



⇒ UK Export Controls


No Update Noted (What does this mean?)



⇒ U.S Export Controls


US Changes Russia, Belarus, and Iran Export Controls

The US Department of Commerce's Bureau of Industry and Security has expanded and refined export controls related to Russia, Belarus, and Iran. The new rule adds 94 new Harmonized Tariff Schedule (6HTS)-6 codes to the list of items subject to the Russian and Belarusian Industry Sector Sanctions, aiming to prevent Iran from supplying unmanned aerial vehicles (UAVs) to Russia. The rule also expands the scope of the de minimis rule, making non-US-made items automatically subject to the EAR when they incorporate the lowest-level military- and spacecraft-related items of US-origin. The changes aim to bring the EAR into greater alignment with EU, UK, and other allied countries' controls. Read our blog



A Russian-Canadian national pleads guilty to conspiracy to launder money from a scheme to send UAV and missile components to Russia in violation of US sanctions.

Kristina Puzyreva, a Russian-Canadian national, has pleaded guilty to money laundering conspiracy for her role in a multimillion-dollar scheme to send components used in unnamed aerial vehicles (UAVs) and guided missile systems to sanctioned entities in Russia. The components shipped in violation of export control and sanctions laws were later found in Russian weapons platforms and signals intelligence equipment in Ukraine. Puzyreva faces up to twenty years in prison at sentencing. The government has seized approximately 1.68 million dollars with the export scheme.

 

Former Iranian-Owned Boeing Aircraft Successfully Returned to the United States

 The US Department of Justice has successfully seized a Boeing 747 cargo plane, previously owned by Iranian airline Mahan Air, which was transferred to the US. Argentina transferred the aircraft to the US, which transferred its physical custody to the US. The US has been working with international partners to hold Iranian entities accountable for violating US export control laws. The plane was previously detained by Argentine law enforcement and was later transferred to Empresa de Transporte Aéreocargo del Sur, S.A. (EMTRASUR), a Venezuelan cargo airline. The US has filed a civil forfeiture complaint alleging that the unauthorised transfer of the aircraft directly benefited the Islamic Revolutionary Guard Corps, a designated terrorist organisation. The matter is being investigated by the Department of Commerce Bureau of Industry and Security's Miami Field Office and the FBI Miami Field Office.


DTSF One-Year Summit Readout

The Strike Force, a joint agency of the Department of Justice, Commerce, Federal Bureau of Investigation, and Homeland Security, recently held a summit with the Ukrainian government. The event covered case studies, best investigative practices, and cutting-edge technologies. The event also announced the expansion of the Strike Force to three new metropolitan areas. The U.S. commemorates the one-year anniversary of the Disruptive Technology Strike Force. The Disruptive Technology Strike Force is an interagency law enforcement endeavour aimed at preventing crucial technology from being acquired by authoritarian regimes and hostile nation-states. Details


Further Afield


The Australian government is proposing significant new changes to the laws governing export control.

With the goal of facilitating knowledge transfer between AUKUS partners, the Australian government is putting up major revisions to export control rules. The proposed modifications would do away with the need for authorization in order to send restricted products to the US and the UK, but they also add three new criminal offences for companies that deal with commodities on the Defence and Strategic products List (DSGL). A maximum sentence of 10 years in prison and/or 2,500 penalty units might be imposed for breaking these laws. Companies would have to engage with stakeholders on further exclusions and broaden their screening procedures for international counterparties and supply agreements. Read our briefing


Sanctions Updates

We highlight the most important developments in the realm of EU, UK and U.S sanctions in our weekly report. Please do not hesitate to get in touch with any member of our Sanctions team mentioned above if you need any clarification about any of the developments listed below. For the collection of all articles we have written on this topic here https://www.customsmanager.info/all-news/categories/sanctions



⇒ EU Sanctions Updates


EU demands Central Bank of Russia assets split

Central securities depositories with more than €1 million in assets from the Central Bank of Russia must "account extraordinary cash balances accumulating due to EU sanctions separately" and "keep corresponding revenues separate," according to the EU. The EU prohibits them from selling net earnings. Central securities depositories may request supervisory approval to discharge a percentage of net income to pay for legal capital and risk management.


EU lays forth grounds for sanctions on new laws aimed at accelerating money transfers.

In order to guarantee that payment service providers (PSPs) conduct money transactions promptly, the EU Parliament has enacted a law. The payer's PSP is not required to confirm, while an immediate credit transfer is being executed, whether the payer or the payee, whose payment accounts are being utilised, are sanctioned individuals or companies. When comes into effect, PSPs are required to investigate if any of their users are individuals or organisations that are subject to penalties. Read the text adopted


⇒ UK Sanctions Updates


Changes coming to OFSI guidance in 2024

OFSI is set to introduce a new Sanctions Digital Guidance format in 2024. This change will improve navigation, responsiveness, accessibility, and compatibility for users. It will make it easier to find the help needed, provide new information quickly, and ensure all-inclusive recommendations. The new format will be compatible with smartphones and tablets, ensuring ease of use. OFSI is also working to enhance the website's appearance and structure to accommodate the new guidelines. The financial sanctions guideline will be updated to the Sanctions Digital guideline throughout 2024.  The link for more details is here.

 

Various Sanctions Guidance Published by OFSI

The Office of Financial Sanctions Implementation (OFSI) has released numerous guidelines to help individuals understand and comply with UK financial sanctions. These guidelines include guidelines for ransomware, importers and exporters, maritime transportation, nonprofit organizations, charities, general guidelines, Libya, travel advice, Russia, and high-value dealers. Access them all here

 


OFSI has updated the general licence for the Russian Price Cap and added a expiry date.


UK Sanctions Against Russia Updated

The listing for Vladimir Olegovich POTANIN has been updated. Please see listing here. 


UK Sanctions Global Human Rights lists updated

The UK Foreign Secretary has named four “extremist Israeli settlers” for human rights crimes against West Bank Palestinian communities: Moshe Sharvit, Yinon Levy, Zvi Bar Yosef, and Ely Federman have been accused of threatening, harassing, and assaulting Palestinian shepherds and their families in the Jordan Valley. The 'Meitarim Farm' outpost, founded in 2021, has also been accused of using violence and property destruction to displace Palestinian communities. The UK Sanctions Global Human Rights lists has been updated and four people have been added to the list. Notice here


OFSI blog on Russia DP reporting requirements.

The UK government has introduced two new reporting measures to strengthen transparency of frozen assets and assist the HM Treasury in monitoring compliance with financial sanctions. The first requirement requires firms to inform OFSI of any funds or economic resources they hold for the Central Bank of Russia (CBR), Russian Ministry of Finance (MOF), or Russian National Wealth Fund (NWF). This will provide the government with a more comprehensive picture of the value and nature of these assets held in the UK. The second requirement requires designated persons under the Russia regime to proactively provide details of their UK assets to OFSI. This strengthens OFSI's compliance toolkit and places accountability for asset reporting on those who are designated. The government intends to extend this measure to the Belarus regime in early 2024. OFSI will continue to use enforcement tools robustly but fairly and proportionately, including imposing monetary penalties, to effectively enforce financial sanctions in the UK. Read full blog.

UK Law Society Updates Own Guidance

The United Kingdom Law Society has recently updated this guide on the United Kingdom sanctions regime. The content covers various aspects of the United Kingdom sanctions system, such as risk assessments, reporting requirements, and other related issues. Review


UK Resources to help you and your firm comply


UK Foreign, Commonwealth and Development Office (FCDO) resources to help you comply with sanctions



⇒ U.S. Sanctions Updates


National risk assessments on the financing of terrorism and proliferation


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According to the US Treasury, the 2024 National Terrorist Financing Risk Assessment and the 2024 National Proliferation Financing Risk Assessment show the following: In violation of UN sanctions, Russia has engaged in bilateral arms deals with Iran and the DPRK. DARK-affiliated networks are increasingly taking advantage of the digital economy, including by hacking virtual asset service providers and sending fictitious IT workers abroad. Russia has increased its efforts to obtain US-origin goods for military use through various obfuscation strategies, including the use of front companies and transshipment points worldwide.


US seized Iranian Plane

The US has seized a Boeing 747 cargo plane that Iran sold to a Venezuelan state airline, drawing condemnation from Tehran. The US imposed sanctions on Mahan Air, an airline affiliated with the Islamic Revolutionary Guard Corps (IRGC), for selling the plane to Venezuela in 2022. Argentina grounded the plane 18 months ago, and Iran condemned the move as illegal and violating the United Nations Charter. Venezuela's government vowed to regain ownership and possessions.


OFAC Sanctions Updates on Russia Oil Cap: blocs one vessel

OFAC is sanctioning sanctions on four entities and identifying one vessel as blocked property. The network of these entities and the vessel were involved in a price cap violation scheme in late 2023. OFAC is also issuing two new determinations that implement G7 commitments to ban the importation of Russian diamonds.

OFAC determination on Diamonds trade from Russia


Russia-related General License 87 issued


Treasury Sanctions Ecuador’s Notorious Los Choneros Gang and Its Leader

OFAC sanctioned one of Ecuador’s most violent gangs, Los Choneros, and its leader, José Adolfo Macías Villamar (also known by the alias “Fito”), pursuant to counter narcotics authorities. OFAC’s action follows a steep rise in violence in Ecuador attributed to the actions of Los Choneros and other drug trafficking gangs in the country.



Upcoming Export Control and Sanctions Training


Learn the essentials of dual-use products and export limits to avoid expensive fines. Our training will be advantageous to any US and non-US firm engaging in international trade, especially concerning items of US origin. Our training help prevent expensive export control and sanctions fines. It imparts essential knowledge that personnel responsible for export controls and sanctions compliance need to grasp.


Sanctions

This course develops the competencies that professionals need to deal with all key compliance aspects of sanctions laws and policies. Using examples from the EU, the UK and the U.S., we will explore how to check entities, individuals and organisations against sanctions lists, how to set up an effective restricted party screening programme, how to identify economic trade sanctions and how your products may be affected by it. We will determine due diligence requirements, and how you can identify attempts for circumvention. We will discuss how to apply for a sanction’s exemption licence, a licence exception / general licence. Includes a discussion around red flags and how to set up a sanctions policy and programme. Special feature: Participants will workshop through real sanctions’ case studies and explain the action that they would take to ensure compliance.


Dates (Click To Book)


Export Controls

This course develops the competencies that professionals need to deal with the four fundamental aspects of export controls: Product, Destination, End-User and End-Use Controls. Using examples from the EU, the UK and the U.S., we will explore how to determine if an item is subject to export controls and detail the steps to acquire an export control licence and/to apply for a licence exception / general licence. Includes a discussion around red flags and Internal Export Compliance Programmes (ICP/ECP). Special feature: A hands-on workshop where you get to determine the export control rating of your product by yourself (supported by your expert instructor).


Dates (Click To Book)


U.S. Export Controls

This course focuses on U.S. Export Controls, the EAR and ITAR.  Discover how an item can be subject to the EAR or ITAR, how to verify items against the CCL or the USML, how to determine licence requirements and licence exceptions, how to make a licence application, check Export Controls specific restrictive lists and more. We cover

  • The enforcement authority of the Bureau of Industry and Security (BIS) extends overseas.

  • Key US law on export restrictions and importance for non-US firms.

  • Concepts and definitions related to dual-use products.

  • the many categories of EAR bans for non-US companies.

  • The many export classifications and categories, including dual use.

  • The Commerce Control List: An Introduction (CCL).

  • the primary dangers associated with doing business with US companies.

  • Fines and penalties.

  • Vigilance and warning signs.

  • How to create an export compliance programme (ECP) that works?

  • How BIS licences are applied for.


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Special feature: A close look at the extraterritorial application of U.S. Export Controls De Minimis, Foreign Direct Product Rule, Second Incorporation Principle and more

Dates (Click To Book)



What if I have a question regarding these updates


We invite you to use the chat function available on www.customsmanager.org to ask any questions related to this update. Our skilled team of export control and sanctions managers will be happy to provide you with the information you need within 24 hours.

Sources


EU

  • Official Journal of the EU

  • DG TRADE Website

  • Social Media (LinkedIn, Twitter, etc).

  • Information on the National Export Control & Sanctions Website of Member States

  • Social Media Postings


U.S.

  • Bureau of Industry and Security (BIS)

  • Department of Commerce

  • Office of Foreign Asset Control (OFAC)

  • Social Media (LinkedIn, Twitter, etc).


UK

  • Information on gov.uk

  • Information on legislation.gov.uk

  • Department of Business and Trade

  • Social Media (LinkedIn, Twitter, etc).


Other

  • United Nations (Sanctions)

  • Social Media (LinkedIn, Twitter, etc).



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