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 involved an independent U.S. government investigation, not a voluntary self-disclosure.

The charges related to TransTel causing six different financial institutions to provide unauthorized financial services relating to transactions with Iran.  The funds transfers were processed in part in the U.S. and they involved the supply of goods or services handled by a variety of vendors and service providers with connections to Iran.  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 that backs the embattled Maduro regime.  The designation means that Mr. Maduro’s assets in the United States will be seized and that U.S. persons are now generally prohibited from conducting direct or indirect transactions involving the President.  The addition of Maduro to the SDN List follows the designation last week of several government-linked individuals, including an executive at the state-run PDVSA oil company.  The United States is said to be considering additional sanctions on the country, including sanctions targeting Venezuela’s oil industry.

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 become law because there is currently sufficient support in Congress to override a Presidential veto, should one be issued. Here are some of the key Russia sanctions issues U.S. and non-U.S. companies should keep in mind as the bill progresses:

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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 the Russian military invasion of Ukraine and the annexation of the Crimea region of that country.  In addition to the freezing of individuals’ assets, both the United States and the EU ban the importation or exportation of goods, services, or technology to or from Crimea, among other prohibitions.

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Congress Weighs-In on New MTB Process In Advance of Final ITC Report

Congressional trade committee leaders submitted comments for the ITC to consider in its final Miscellaneous Tariff Bill report due for release in August.  House Ways and Means Chairman Kevin Brady and Raking Member Richard Neal, along with Senate Finance Chairman Orrin Hatch and Ranking Member Ron Wyden, offered comments based on a review of the ITC’s June-issued preliminary MTB report, which evaluated the eligibility of some 2,500 petitions submitted by U.S. companies seeking duty savings on imported products not made in the United States in accordance with a new process established by the American Manufacturing and Competitiveness Act of 2016.

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Combating Evasion of Duties Front and Center

Last year, President Obama signed into law the Trade Facilitation and Trade Enforcement Act of 2015 (“TFTEA”).  Section 421 of the TFTEA (commonly called the Enforce and Protect Act, or EAPA), establishes procedures for submitting and investigating allegations of evasion of antidumping and countervailing duties.

The statute encouraged a wide variety of stakeholders to participate in this new administrative process.  For example, the statute defined “interested parties” who may file an allegation of evasion to include foreign exporters and producers, importers, and domestic manufacturers and wholesalers, of products covered by antidumping and countervailing duty orders.  Indeed, interested parties on all sides of the trade equation who play by the rules have an incentive to participate in the CBP’s evasion investigations.  Continue Reading

EU Considering Retaliatory Measures on U.S. Exports of Whiskey, Juice, and Dairy Products Over Steel

The European Union is threatening to impose retaliatory measures on several key export products, including whiskey, orange juice, and dairy products, if President Trump follows through with plans to limit steel imports based on national security concerns.

At a G20 summit in Hamburg on July 7, 2017, European Commission President Jean-Claude Juncker said that the EU is prepared to “react with counter-measures” within “days” if President Trump imposes steel tariffs.  According to the Financial Times, because U.S. does not export much steel to Europe, EU officials are targeting U.S. agriculture products and other “politically sensitive” products with bourbon whiskey, orange juice and dairy at the top of the list. Continue Reading

First Look Into Trump Administration’s NAFTA Strategy

USTR Releases NAFTA Negotiating Objectives One Month Ahead of Anticipated Start to Renegotiations 

In a next step toward renegotiating NAFTA, USTR has released a summary of the administration’s negotiating objectives.  Although the overall themes are no surprise, the summary provides limited additional insight into the renegotiation goals through tangible examples.  There is a continued emphasis on increased and improved market access for American businesses, as well as ensuring free and fair trade among the NAFTA parties.

Notably, USTR is now citing deficit reduction as an objective for the NAFTA renegotiations.  Other key objectives cited in USTR’s summary include: Continue Reading

Manufacturing Sector Leads Foreign Direct Investment in U.S., According to New Commerce Report

The U.S. Department of Commerce’s Bureau of Economic Analysis has released the 2016 figures in their data series on foreign direct investment in U.S. Businesses. This series allows businesses, researchers, and policy makers to gain insights into recent trends in foreign investment. Investments and the employment generated, are broken down by country of origin, industry type, and location of businesses in which the investments were made.  The data are further broken down by whether the investment involves acquisition, establishment, or expansion of a business. Continue Reading

Commerce and OMB Issue ‘Buy American’ Guidance to Federal Agencies

On Friday June 30, Secretary of Commerce, Wilbur Ross, and Director of OMB, Mick Mulvaney, released a memorandum providing guidance to executive departments and agencies that must, pursuant to the directives of President Trump’s April 18th Executive Order entitled “Buy American and Hire American,” undertake an analysis of their administration of applicable Buy American laws.

The memo directs agency chiefs to submit to the Commerce Department and OMB a report that details their assessment of the implementation of Buy American Laws within their agencies by September 15th in compliance with the executive order’s section 3. Continue Reading