Click on each item to read the update.
Highlights of the Executive Order are as follows:
Implementation of the ACE Cargo Release Functionality for all entry types and the decision to no longer require paper CBP Forms 3461 and 7501, there is also a need for a paperless process for TIB Entries. Apparently, this functionality is being planned. Meanwhile all using TIB entry type 23 need to present the same in the following manner:
EASE Update: Clients need not worry about the newly added individuals and entities as these are updated daily in EASE and clients may download these lists automatically
|Individual and Entity Names, Sources|
|The Office of Foreign Assets Control (OFAC) – Specially Designated Global Terrorist (SDGT) pursuant to Executive Order 13224, which targets terrorists and those providing support to terrorists or acts of terrorism||Muhammad Hadi al-`Anizi
Muhammad Bahrun Naim Anggih Tamtomo and Muhammad Wanndy Bin Mohamed Jedi
|Department of State designates persons as global terrorists||Alsayed Murtadha Majeed Ramadhan Alawi
Ahmad Hasan Yusuf
Sami Bashur Bouras
El Shafee Elsheikh
|The Bureau of Industry and Security BIS denies export privileges||Eyad Farah
BIS Adds the following entity on the Entity List
|BIS removes these persons from the Entity List||China:
Zhongxing Telecommunications Equipment (ZTE) Corporation
ZTE Kangxun Telecommunications Ltd.
Industrio GmbH, Dreichlinger
Wilhelm “Bill” Holler
Beaumont Trading AG
Beaumont Trading AG
United Arab Emirates
Beaumont Trading AG
|The U.S. Department of Homeland Security’s Immigration and Customs Enforcement (ICE) has announced that Rivero has been sentenced to 92 months in prison for attempting to export illegally ammunition to Mexico||Gabriel Rivero
|DOJ has announced that Kassam Tajideen, a prominent financial supporter of the Hizballah terror organization, has been arrested and charged with evading U.S. sanctions imposed on him because of his financial support of Hizballah.||Kassam Tajideen|
|The U.S. Department of State (DOS) has announced that the United States imposed sanctions on 30 foreign entities and individuals in 10 countries pursuant to the Iran, North Korea, and Syria Nonproliferation Act (INKSNA)||Beijing Zhong Ke Electric Co. Ltd. (ZKEC) (China)
Dalian Zenghua Maoyi Youxian Gongsi (China)
Jack Qin (Chinese individual)
Jack Wang (Chinese individual)
Karl Lee [aka Li Fangwei] (Chinese individual)
Ningbo New Century Import and Export Company Limited (China)
Shenzhen Yataida High-Tech Company Ltd (China)
Sinotech (Dalian) Carbon and Graphite Corporation (SCGC) (China)
Sky Rise Technology [aka Reekay Technology Limited] (China)
Saeng Pil Trading Corporation (SPTC) (North Korea)
Mabrooka Trading (United Arab Emirates)
DOS applied the measures authorized in Section 3 of the Iran, North Korea, and Syria Nonproliferation Act (Pub. L. 109-353) against the following foreign person identified in the report submitted pursuant to Section 2(a) of the Act
|https://www.gpo.gov/fdsys/pkg/FR-2017-03-29/html/2017-06224.htm||Rosoboronexport (ROE) (Russia) and any successor, sub-unit, or subsidiary thereof|
|State Dept. Imposes Nonproliferation Measures against Multiple Foreign Persons and Entities||Ministry of Defense Directorate of Defense Industries (DDI) (Burma) and any successor, sub-unit, or subsidiary thereof;
Beijing Zhong Ke Electric Co., LTD. (ZKEC) (China), and any successor, sub-unit, or subsidiary thereof;
Dalian Zhenghua Maoyi Youxian Gongsi (China) and any successor, sub-unit, or subsidiary thereof;
Jack Qin (Chinese individual); Jack Wang (Chinese individual);
Ningbo New Company Import and Export Company Limited (China) and any successor, sub-unit, or subsidiary thereof;
Karl Lee [aka Li Fangwei] (Chinese individual);
Shanghai Horse Construction [aka Forrisio International Group] (China) and any successor, sub-unit, or subsidiary thereof;
Shenzhen Yataida High-Tech Company Ltd. (China) and any successor, sub-unit, or subsidiary thereof;
Sinotech (Dalian) Carbon and Graphite Corporation (SCGC) (China) and any successor, sub-unit, or subsidiary thereof;
Sky Rise Technology [aka Reekay Technology Limited] (China) and any successor, sub-unit, or subsidiary thereof;
Sun Creative (Zhejiang) Technologies, Inc. (China) and any successor, sub-unit, or subsidiary thereof;
T-Rubber Co. Ltd (China) and any successor, sub-unit, or subsidiary thereof;
Special Defense Research Center (SDRC) (Egypt) and any successor, sub-unit, or subsidiary thereof;
Eritrean Navy (Eritrea) and any successor, sub-unit, or subsidiary thereof;
Aerospace Industries Organization (AIO) (Iran) and any successor, sub-unit, or subsidiary thereof;
Saeng Pil Trading Corporation (SPTC) (North Korea) and any successor, sub-unit, or subsidiary thereof;
150th Aircraft Repair Plant (Russia) and any successor, sub-unit, or subsidiary thereof; Aviaexport (Russia) and any successor, sub-unit, or subsidiary thereof;
Bazalt (Russia) and any successor, sub-unit, or subsidiary thereof;
Kolomna Design Bureau of Machine-Building (KBM) (Russia) and any successor, sub-unit, or subsidiary thereof;
Ulyanovsk Higher Aviation Academy of Civil Aviation (UVAUGA) (Russia) and any successor, sub-unit, or subsidiary thereof;
Ural Training Center for Civil Aviation (UUTsGA) (Russia) and any successor, sub-unit, or subsidiary thereof;
Zhukovskiy and Gagarin Academy (Z&G Academy) (Russia) and any successor, sub-unit, or subsidiary thereof;
Madar Yara Medical Company (Saudi Arabia) and any successor, sub- unit, or subsidiary thereof;
Giad Heavy Industries (GHI) (Sudan) and any successor, sub-unit, or subsidiary thereof;
Military Industries Corporation (MIC) (Sudan) and any successor, sub-unit, or subsidiary thereof;
Muhammad al-Husayn Yusuf (Sudanese individual); and
Mabrooka Trading (United Arab Emirates) and any successor, sub- unit, or subsidiary thereof.
Embraer is large Brazilian aerospace company that manufactures aircrafts. Embraer intended to offer the KC-390 aircraft in response to a United States Forest Service (USFS) solicitation for air tankers that can be used in civil fire-fighting operations. The KC-390 was being produced in Brazil. Embraer planned to modify the KC-390 from a medium military cargo aircraft to a fire suppression aircraft to meet the requirements of the USFS solicitation. The work on the aircraft was to occur in the United States at a Boeing facility in San Antonio, Texas. The conversion of the KC-390 from a military transport aircraft to a civil fire-fighting aircraft would require modification of multiple systems and structures in order to meet the USFS requirements for aerial fire-fighting.
What is the country of origin of the Embraer KC-390 aircraft after it has been converted from a military cargo aircraft to an aircraft that can be used by the USFS in combatting forest fires?
Based upon the specific facts of the case, the country of origin of the KC-390 aircraft converted from a military cargo aircraft to a fire suppression aircraft for purposes of U.S. Government procurement would remain Brazil, the country where it was originally manufactured.
An article is a product of a country or instrumentality only if (i) it is wholly the growth, product, or manufacture of that country or instrumentality, or (ii) in the case of an article which consists
in whole or in part of materials from another country or instrumentality, it has been substantially transformed into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was so transformed.
The determining Factors included:
The information presented indicated that the most important systems of the KC-390 would remain intact.
The modification of the KC-390 aircraft largely consisted of removing items from the aircraft that are associated with hauling military cargo and personnel and installing some new systems in order that the aircraft can carry and disperse fire retardant materials.
the basic structural integrity and the aerodynamics of the aircraft would not be changed For example, the size and shape including its length and wing-span will not be changed.
no information was presented showing that the engine powering the aircraft would be significantly reworked, meaning there will be no meaningful change to the aircraft’s power, speed and range.
The electronics and instruments, which are involved in flying the airplane, will not be significantly changed.
The fundamental identity of the product Would not be changed.
After the work is completed to give the KC-390 its forest fire- fighting capability, the product will still remain an airplane.
when the aircraft is imported into the United States, it is already a fully functioning airplane capable of flight, and ready for transporting personnel and equipment.
The changes made to the aircraft to convert it to a fire suppression airplane are not extensive enough to result in a substantial transformation of the aircraft.
Access USA Shipping, LLC committed 150 violations of the EAR, highlights of the violations are as follows:
Between January 2010 and January 2016, ZTE, either directly or indirectly through a third company, shipped approximately $32,000,000 of U.S.-origin items to Iran without obtaining the proper export licenses from the U.S. government. In early 2010, ZTE began bidding on two different Iranian projects. The projects involved installing cellular and landline network infrastructure. Each contract was worth hundreds of millions of U.S. Dollars and required U.S. components for the final products.
In December 2010, ZTE finalized the contracts with Iranian customers. The contracts were signed by four parties: the Iranian customer, ZTE, Beijing 8 Star and ZTE Parsian. Court documents explain that ZTE identified Beijing 8 Star (8S) as a possible vehicle for hiding its illegal shipments of U.S. items to Iran. It intended to use 8S to export U.S.-origin items from China to ZTE customers in Iran. As part of this plan, ZTE supplied 8S with necessary capital and took over control of the company.
Under the terms of the Iran contracts, ZTE agreed to supply the “self-developed equipment,” collect payments for the projects and manage the whole network. ZTE Parsian was to provide locally purchased materials and all services. 8S was responsible for “relevant third-party equipment,” which primarily meant parts that would be subject to U.S. export laws. ZTE intended for 8S to be an “isolation company,” that is, ZTE intended for 8S (rather than ZTE) to purchase the embargoed equipment from suppliers and provide that equipment under the contract in an effort to distance ZTE from U.S. export-controlled products and insulate ZTE from U.S. export violations. However, 8S had no purchasing or shipping history and no real business reputation.
Ultimately, although 8S was a party to the contracts, ZTE itself purchased and shipped the embargoed goods under the contract. In its shipping containers, it packaged the U.S. items with its own self-manufactured items to hide the U.S.-origin goods. ZTE did not include the U.S. items on the customs declaration forms, though it did include the U.S.-origin items on the packing lists included inside of the shipments.
In early 2011, when ZTE determined that the use of 8S was insufficient to hide ZTE’s connection to the illegal export of U.S.-origin goods to Iran, senior management of ZTE ordered that a company-level export control project team study, handle and respond to the company’s export control risks. In September 2011, four senior managers signed an Executive Memo, which proposed that the company identify and establish new “isolation companies” that would be responsible for supplying U.S. component parts necessary for projects in embargoed countries. The isolation companies would conceal ZTE’s role in the transshipment scheme and would insulate ZTE from export control risks.
In March 2012, Reuters published an article regarding ZTE’s sale of equipment to Iran. In response, ZTE made a decision to temporarily cease sending new U.S. equipment to Iran. By November 2013, however, ZTE had resumed its business with Iran. Beginning in July 2014, ZTE began shipping U.S.-origin equipment to Iran once again without the necessary licenses.
Instead of using 8S, however, ZTE identified a new isolation company. ZTE signed a contract with the new isolation company, which in turn signed contracts with the two Iranian customers. According to the new scheme, ZTE purchased and manufactured all relevant equipment – both U.S.-origin and ZTE-manufactured – and prepared them for pick-up at its warehouse by the new isolation company. The new isolation company then shipped all items to the Iranian customers. Shipments to Iran continued from January 2014 through January 2016.
Despite its knowledge of an ongoing grand jury investigation into its Iran exports, ZTE took several steps to conceal relevant information from the U.S. government. It further took affirmative steps to mislead the U.S. government. In the summer of 2012, ZTE asked each of the employees who were involved in the Iran sales to sign nondisclosure agreements in which the employees agreed to keep confidential all information related to the company’s U.S. exports to Iran.
During meetings throughout late 2014, late 2015 and early 2016, outside counsel for ZTE, unaware that the statements ZTE had given to counsel for communication to the government were false, represented to the DOJ and federal law enforcement agents that ZTE had stopped doing business with Iran and therefore was no longer violating U.S. export laws. Similarly, on July 8, 2015, in-house counsel for ZTE accompanied outside counsel in a meeting with the DOJ and federal law enforcement agents and reported that ZTE was abiding by U.S. laws. That statement was also false.
ZTE also hid data related to its resumed illegal sales to Iran from a forensic accounting firm hired by defense counsel to conduct an internal investigation into the company’s Iran sales. ZTE knew the forensic accounting firm was reviewing its systems and knew that the analysis was being reported to the DOJ and U.S. law enforcement. To avoid detection of its 2013-2016 resumed illegal sales to Iran, ZTE formed the “contract data induction team” (“CDIT”). The CDIT was comprised of approximately 13 people whose job it was to “sanitize the databases” of all information related to the 2013-2016 Iran business. The team identified and removed from the databases all data related to those sales. ZTE also established an auto-delete function for the email accounts of those 13 individuals on the CDIT, so their emails were deleted every night – a departure from its normal practices – to ensure there were no communications related to the hiding of the data.
ZTE Corporation has agreed to enter a guilty plea and to pay a $430,488,798 PENALTY to the U.S. for conspiring to violate the International Emergency Economic Powers Act (IEEPA) by illegally shipping U.S.-origin items to Iran, obstructing justice and making a material false statement. ZTE simultaneously reached settlement agreements with the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) and the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC). In total ZTE has agreed to pay the U.S. Government $892,360,064. The BIS has suspended an additional $300,000,000, which ZTE will pay if it violates its settlement agreement with the BIS.