Category Archives: Export Controls and Sanctions

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Importers Beware: U.S. Customs Targets Imports Made in China by North Korean Workers

The AP recently reported that North Koreans are working in China as forced labor and their products are being imported into the U.S.  The AP followed the production of seafood from Chinese facilities to U.S. retailers, but stated that there other affected product categories, including apparel and wood flooring. While it has been known that … Continue Reading

The Paper Caper: U.S. Persons Cannot Help Foreign Subsidiaries or Affiliates with Sanctioned Country Transactions

A recent settlement agreement between the Office of Foreign Asset Control (OFAC) and BD White Birch Investment LLC, a U.S.-based paper company, is an important reminder that U.S. companies cannot assist their foreign subsidiaries or affiliates with sales related to sanctioned countries. … Continue Reading

EVENT ANNOUNCEMENT: What European Companies Need to Know About U.S. Sanctions, Export Controls, and FCPA Compliance

Join us in Brussels on November 9th, for this 2 hour seminar on what European companies need to know about U.S. sanctions, export controls, and anti-bribery compliance, co-hosted with the American Chamber of Commerce in Belgium.  We’ll tackle some of the most recent updates to U.S. sanctions rules, including the broad new sanctions on Russia mandated by … Continue Reading

Sale of Cartier Jewels Triggers OFAC Violations – Luxury Brands Should Be Aware of U.S. Sanctions Risks

A settlement agreement between Richemont North America, the parent company of Cartier, and the Office of Foreign Assets Control (OFAC) for violations of U.S. sanctions regulations is an important wake up call for U.S. and global retailers, which have often considered themselves to be somewhat outside the scope of U.S. sanctions laws.  In truth, the … Continue Reading

New U.S. Sanctions on North Korea – What You Need To Know

Last week the U.S. government announced new sanctions on North Korea designed to target non-U.S. persons, aircraft, vessels, and financial institutions that facilitate trade and transactions with the country.  The Executive Order contained four elements: new authority to designate persons as Specially Designated Nationals (SDNs), sanctions on certain aircraft and vessels that visit North Korea, … Continue Reading

Risks in the common practice of sending technical data outside the U.S. — New Jersey company penalized $400,000

Does your company source components or parts outside the U.S.?  When doing so, you need to be careful about sending unlicensed export controlled technical data like drawings, blueprints and manufacturing instructions as part of an RFQ or production process.  Many companies send such information to overseas parts vendors and to non-U.S. person employees at domestic vendors … Continue Reading

Time to Review Your Encryption Classifications – BIS Updates Primary Purpose Exemption

The Bureau of Industry and Security (BIS) recently published changes to its encryption regulations in an effort to simplify the text and focus the scope of controls.  The biggest change is that Note 4, the “primary purpose exemption,” has been replaced by a positive list of controlled items.  These changes also introduce the term “cryptography … Continue Reading

Trump Administration Threatens Unilateral Sanctions Against North Korea’s Trading Partners

Treasury Secretary Mnuchin announced Wednesday that the Trump Administration was considering sanctioning any country that continues trade with North Korea if the United Nations does not approve additional sanctions against the country.  At an emergency UN meeting in the wake of an additional North Korean nuclear test over the weekend, the U.S. proposed stricter sanctions towards the … Continue Reading

U.S. Hits Venezuela and Petróleos de Venezuela (PdVSA) with Financial Sanctions

On Friday, August 25th, the U.S. government announced new financial sanctions on Venezuela.  The move is the most recent U.S. response to the escalating political and humanitarian crisis in the country.  The new Executive Order bars U.S. persons from: Dealing in ‘new debt’ of Petróleos de Venezuela (PdVSA), Venezuela’s state-owned oil company, that has a … Continue Reading

U.S. Targets Chinese and Russians for North Korea Dealings

The Office of Foreign Assets Control (OFAC) designated 16 parties as Specially Designated Nationals (SDNs) today, effectively seizing their assets in the United States, blocking them from doing business with U.S. parties, and denying them access to the U.S. financial system.  The designations mark the latest escalation of sanctions on North Korea and an increasing … Continue Reading

New Russia, Iran, and North Korea Sanctions Become Law

Today the President signed landmark legislation into law mandating new and enhanced sanctions on Russia, Iran, and North Korea.  As noted in our prior posts, here and here, the law will tighten existing sanctions on those countries and provide the U.S. government with broader power to penalize companies under primary and secondary sanctions rules. Please … Continue Reading

OFAC Penalizes Singaporean Communications Provider $12 Million For Iranian Transactions Conducted In U.S. Dollars  

Global communications solutions provider, CSE TransTel, a subsidiary of CSE Global Limited (both based in Singapore), recently agreed to settle Iran sanctions charges leveled by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) for $12 million.  The charges involve 104 violations of the Iran sanctions between June 2012 and March 2013.  The case … Continue Reading

U.S. Blacklists the President of Venezuela as a Specially Designated National (SDN)

Today the U.S. Office of Foreign Assets Control (OFAC) took the unusual step of blacklisting the leader of a foreign country as a Specially Designated National (SDN).  OFAC added Nicolas Maduro, the President of Venezuela, to the SDN List after a flawed vote that essentially replaced the country’s democratically elected legislature with a new body … Continue Reading

Congress Passes Landmark Russia Sanctions

Last night the U.S. Senate passed sweeping sanctions on Russia, Iran, and North Korea by a vote of 98-2.  The Countering America’s Adversaries Through Sanctions Act (the Act) contains important changes to U.S. sectoral sanctions on Russia and provides enhanced authority to issue primary and secondary sanctions on that country. The bill looks likely to … Continue Reading

Siemens Cracks Down on Russian Sanctions Evasion

Siemens, a German corporation, has announced that it will no longer deliver power plant equipment to state-controlled firms in Russia after it claimed to discover that Siemens’ Russian customer, Technopromexport, had diverted gas power plant turbines to the disputed territory of Crimea. The United States and the European Union have implemented sanctions targeting Crimea since … Continue Reading

President Punts on Sudan Sanctions

The President issued a new Executive Order today delaying a decision on whether to permanently lift sanctions on Sudan. In January, President Obama announced the interim lifting of U.S. sanctions on Sudan.  At that time the Office of Foreign Assets Control (OFAC), the agency primarily responsible for implementing U.S. sanctions, issued a general license (or … Continue Reading

US Govt Seeks $1.9 Million In North Korea Sanctions and Money Laundering Case

A recent suit filed by the U.S. Department of Justice (DOJ) for the forfeiture of nearly $2 million highlights the broad extraterritorial reach of U.S. sanctions laws.  On June 14, DOJ filed a complaint to seize funds associated with transactions between several Chinese companies, including Mingzheng International Trading Limited (Mingzheng).  Mingzheng and the other companies … Continue Reading

California Court Orders TransUnion to Pay Record $60M for FCRA Violations for Erroneously Linking Consumers to Criminals in OFAC Database

A California jury in federal court ruled on Tuesday, June 20, that TransUnion violated the Fair Credit Reporting Act (FCRA) by erroneously linking certain consumers with similarly named terrorists and criminals in the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC’s) database.  The jury awarded statutory and punitive damages in excess of $60 million, … Continue Reading

BIS Alert! New Encryption Controls Guidance Posted

The Commerce Department’s Bureau of Industry and Security (BIS) has posted long-awaited updates to its guidance regarding changes to a number of encryption-related provisions in the Export Administration Regulations (“EAR”). The updates cover the changes to encryption controls adopted in September 2016 and include a quick reference guide and updated flow charts for classifying encryption items, … Continue Reading

Congress Takes The Lead In Broad New Sanctions Against Russia

On June 15, 2017, the Senate overwhelmingly – by a vote of 98-2 – approved broad new sanctions against Russia in response to that country’s interference in the 2016 U.S. election and its ongoing aggression in Syria and Ukraine. The legislation would make several big changes.  First, the package would codify existing sanctions on Russia, … Continue Reading

Appeals Court Says That Actual Arrival In Iran Is Not Necessary For OFAC To Find Violation

On May 26, the U.S. Court of Appeals for the DC Circuit remanded for further consideration OFAC’s imposition of a $4 million penalty against Epsilon Electronics for 39 shipments found to violate the Iranian Transactions and Sanctions Regulations (“ITSR”).  According to the DC Circuit, OFAC failed to meet its burden to justify its finding of … Continue Reading
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