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Happy Groundhog Day!!

Happy Groundhog Day!!. Everything You Did Not Want To Know About Export Control. OR EC – The good, the bad, the ugly & the ?. 2 Feb 2012. EYDNWTKAEC. Admin Stuff Intro Cell Phones Be considerate, turn them off or silence the ring tone A lot of information and acronyms

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Happy Groundhog Day!!

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  1. Happy Groundhog Day!!

  2. Everything You Did Not Want To Know About Export Control OR EC – The good, the bad, the ugly & the ?. 2 Feb 2012

  3. EYDNWTKAEC • Admin Stuff • Intro • Cell Phones • Be considerate, turn them off or silence the ring tone • A lot of information and acronyms • Ask questions if you don’t know, may not be able to answer but will find an answer for you • If you fall asleep, do it quietly, no big ZZZZ’s

  4. EYDNWTKAEC We’re glad you are here!

  5. EYDNWTKAEC • What you get: • The Ugly & the Bad stuff • Penalties • Access requirements • Country problems & the big “4” • The Good stuff • Fundamental research • Public domain • Exemptions • The ? • The regs • Who is in the sandbox • Why? • Don’t call Washington!

  6. EYDNWTKAEC – The Ugly & the Bad • Penalties – EAR • Criminal – enforced under the 50 U.S.C. – International Emergency Economic Powers Act • Criminal fine up to $1,000,000.00 • Jail time up to 20 years • Criminal liability for anyone who “willfully conspires to commit or aids or abets in the commission of” an unlawful act described in the statute • Administrative • Strict liability – knowledge is not prerequisite for imposition of an administrative penalty • Administrative violations must be proven by a preponderance of the evidence - 51%

  7. EYDNWTKAEC – The Ugly & the Bad • Penalties – EAR cont’d • 5 year statue of limitations on administrative enforcement cases. • Civil fines up to $250,000.00 per violation or twice the amount of the transaction that is the basis of the violation • Denial of export privileges. Can be any length of time, there is no limit on length they can deny export privileges.

  8. EYDNWTKAEC – The Ugly & the Bad • Penalties – ITAR • Criminal • Each violation, fine of not more the $1,000,000.00, or imprisonment of not more than 20 years, or both • Civil • Each violation a fine of not more than $500,000.00

  9. EYDNWTKAEC – The Ugly & the Bad • Cases • Prof. J. Reece Roth found guilty 0n 18 counts of export violations, conspiracy and fraud for passing sensitive information to two foreign research assistants from China & Iran • Also accused of taking reports & related studies on a laptop to China during a lecture tour in 2006 • UTs Export Officer informed Roth that graduate students could not work on the project • Conviction upheld January 2011 by 6th Circuit Court of Appeals • 4 years in jail and USAF scrapped the research • Dr. Thomas Butler convicted on 47 of a 69 count indictment – 2 export control related, March 2004 • Unauthorized shipment of Yersinia pestis to Tanzania • Two years in jail, $37,400 civil penalty & denial of export privileges for 10 yrs.

  10. EYDNWTKAEC – The Ugly & the Bad • Access requirements • EAR & ITAR are different • Citizenship • LPR • Physical • Information

  11. EYDNWTKAEC – The Ugly & the Bad • Lists and more lists • Denied persons list http://www.bis.doc.gov/dpl/default.shtm • The entity list http://www.bis.doc.gov/entities/default.htm • Embargoed Countries http://www.pmddtc.state.gov/embargoed_countries/index.html • Exclude/Debarred parties list system https://www.epls.gov/ • Specially designated nationals and blocked persons list http://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx • Statutorily debarred parties http://www.pmddtc.state.gov/compliance/debar.html • Unverified parties list http://www.bis.doc.gov/enforcement/unverifiedlist/unverified_parties.html

  12. EYDNWTKAEC – The bad & the ugly • Country problems • The big “4” - C, I, S, & S • State sponsors of terrorism - DOS • EAR – Supp. 1 to Part 738 • ITAR – Section 126.1 • 30 countries on list for various reasons • Check on-line for latest updates

  13. EYDNWTKAEC – The Good • How to ease the pain • Fundamental research exemption • Public Domain • Exemptions ™

  14. EYDNWTKAEC – The Good • Fundamental Research • EAR states – Fundamental research is basic and applied research in science and engineering where the resulting information is ordinarily published and shared broadly within the scientific community. (734.8) • ITAR – Fundamental research is defined to mean basic and applied research in science and engineering where the resulting information is ordinarily published and shared broadly with in the scientific community, as distinguished from research the results of which are restricted for proprietary reasons or specific U.S. Government access and dissemination controls. University research will not be considered fundamental if: • The University or its researchers accept other restrictions on publication of scientific and technical information resulting from the

  15. EYDNWTKAEC – The Good • Cont’d • project or activity, or • The research is funded by the USG and specific access and dissemination controls protecting information resulting from the research are applicable (120.11) • Publicly Available – EAR (772.1) • P.A. Information - Information that is generally accessible to the interested public in any form and, therefore , not subject to the EAR • P.A. technology and software – Technology and software that are already published or will be published; arise during, or the result from fundamental research; are educational; or are included in certain patent applications. (Educational information must be released by instruction in catalog courses and associated teaching laboratories of academic institutions.

  16. EYDNWTKAEC – The Good • More – • Public domain – ITAR • Information which is published and which is generally accessible or available to the public: • Through sales at newsstands and bookstores • Through subscriptions which are available to any individual who desires to obtain or purchase the published information • Through second class mailing privileges granted by USG • At libraries open to the public or from which the public can obtain documents; • Through patents available at any patent office; • Through unlimited distribution at a conference, meeting, seminar, trade show or exhibition, generally accessible to the public in the U.S. • Through public release in any form after approval by the cognizant USG department of agency

  17. EYDNWTKAEC – The Good • Exemptions • EAR – 16 License exceptions, varied, must consult CCL • ITAR - License to export goods & services for a specified time or value • Licenses are the permission to perform an action related to export control. • May come with stipulations, NDA requirements, reporting

  18. EYDNWTKAEC – The ? • The ? • Regs • Who is in the sandbox? • Why EC?

  19. EYDNWTKAEC – The ? • What is an export? • An export is a shipment or transmission of items out of the United States. • An item, which is collective term, per EAR is a commodity (something you can hold, has substance, etc.), software or technology. • Then there are also reexports which are also controlled • A reexport is a shipment or transmission of items subject to the EAR from one foreign country to another. • This rule causes a lot of foreign companies to “design out” controlled U.S. commodities from their products. • Technology and information – non-tangible can also be exported.

  20. EYWTKAEC – The ? • EAR – Export Administration Regulations • Implements the Export Administration Act of 1979 as amended • International Emergency Powers Act as amended • Applies to dual use & commercial items • Dual Use – items that have both commercial and military or proliferation applications • Informal term to describe items that are subject to the EAR • Very broad jurisdictional area BUT narrow licensing requirements • Why EAR? • National security • Foreign policy (anti-terrorism, crime control, regional stability) • Non-proliferation (nuclear & chem/bio weapons, missiles)

  21. EYWTKAEC – The ? • ITAR – International Traffic in Arms Regulations • Arms Export Control Act of 1976 • USML – U.S. Munitions List • List of articles, services and technology that are defense related per the USG and subject to ITAR • Gives the President the authority to control the import and export of defense articles and services • Governs arms sales – foreign military and direct commercial • Mandates the registration and licensing of any person, company or entity that engages in the manufacturing , exporting and brokering of defense articles and services.

  22. EYDNWTKAEC – The ? • Statues • EAR – 15 CFR Commercial and Foreign Trade parts 300 to 799 • Pertinent sections 730-744 • Printed copy – GPO telephone 866-512-1800 or online http:www.access.gpo.gov/bis/earorder.html • CFR online – www.bis.doc.gov or http://ecfr/gpoaccess.gov • Online is your best bet, searchable and most up to date • ITAR – 22 CFR parts 120-130 • Online http://www.pmddtc.state.gov/regulations_laws/itar_official.html

  23. EYDNWTKAEC – The ? • Who is in the sandbox • Dept of Commerce – oversight of the EAR & CCL • Bureau of Industry and Security (aka BIS) • Census Bureau – yes that’s right they get into the act too, for statistics (don’t ignore them, they will get you into jail) • Dept of State – oversight of ITAR • Directorate of Defense Trade Controls (aka DDTC) • Dept of Treasury • Office of Foreign Asset Controls (aka OFAC) • Prepare denied persons & entities lists – who you can not do business with • Also home to the Cuba sanctions and others • Others – DHS (I-129), DOE, NRC, FDA, Interior

  24. EYDNWTKAEC – The ? • Why? • National security • Foreign policy (anti-terrorism, crime control, regional stability) • Non-proliferation (nuclear & chem/bio weapons, missiles) • Sanctions • Economic & Technology

  25. EYDNWTKAEC • Don’t call Washington!!!!!! • If you have a question or a problem, do not call Washington • Call ORS, 325-8682 or e-mail – nelewis@fso.msstate.edu • Call University Legal Counsel, 325-8131

  26. EYDNWTKAEC • Questions????? • Coming Attractions • Website • More training plus an inspection & audit • Baseline of where we are • Late March 2012

  27. EYDNWTKAEC • Remember: What all else fails, and this is a personal observation, things go better with…...

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