“Compliance Insight” is published quarterly for individuals & companies
who must adhere to OFAC & BIS sanctions. With the ever-evolving world of regulatory
compliance, this newsletter is written to provide brief updates on what you need
to know. Not sure if OFAC or BIS applies to your business? Then this newsletter
is definitely for you.
BIS: What You Should Know
By Doug Jacobson, Esq., Law Offices of Douglas N. Jacobson, PLLC
Do you know the difference between the Denied Persons List, Entity List and Unverified
List?
The Commerce Department's Bureau of Industry and Security (BIS) is one of several
U.S. Government agencies that maintain restricted party lists.
Knowing the difference between these lists can have a significant impact on your
ability to engage in a sale or export transaction and not knowing the difference
can lead to the imposition of significant civil or criminal penalties. In fact,
a company recently paid $3.75 million in criminal and administrative penalties as
a result of engaging in a transaction with a party in Pakistan included on the Entity
List. A sales manager for the company also agreed to a $500,000 civil penalty for
his involvement in the transaction.
There is a lot that companies need to know about compliance with the U.S. Export
Administration Regulations (EAR) administered and enforced by BIS. In addition to
understanding and complying with the Denied Persons List, Entity List and Unverified
Lists, they also need to know whether their products are subject to the EAR and
the classification of their products, software and technology under the EAR. Once
that is known, they need to understand the export license requirements and license
exceptions that are applicable to their products.
If companies are not aware of or do not keep up with the ever-changing EAR and other
applicable laws and regulations and commit a violation, the penalties and related
public relations nightmare that could ensue can have an adverse impact on companies.
Of course, one issue is that the restricted party lists are constantly changing,
as are the regulations that govern them. For example, just this month, the new country
of South Sudan was born and BIS issued new regulations governing exports to that
new country.
Compliance with BIS’s regulations is one of those areas where what you don't
know can, and will, hurt you. The only way to keep up with these regular changes
to lists and regulations is to employ an automated system that conducts screenings
at several points during the sales transaction process in order to avoid significant
penalties should you inadvertently deal with a party on a restricted party list.
Next Issue's Feature: OFAC COMPLIANCE
OFAC Specially Designated Nationals Update
7/25/11
· Cuba Travel Advisory
7/25/11
· Transnational Criminal Organizations; Kingpin Act Designations
7/15/11
· Routine update of list of Cuba Travel and Carrier Service Providers and
Remittance Forwarders
7/11/11
· Routine update of list of Travel and Carrier Service Providers and Remittance
Forwarders
7/1/11
· New Libyan Sanctions Regulations, 31 CFR part 570
OFAC In The News
7/20/11
· Update on Update 2011: Sanctions
7/15/11
· Fine Against Reinsurer for Violating Sanctions Regime Highlights Compliance
Issues
BIS Denied Persons
List Updates
7/15/11
Zarand Aviation and GIE Zarand Aviation
42 Avenue Montaigne
Paris, France
and
112 Avenue Kelber
Paris, France
Mahan Airways
Mahan Tower
No. 21 Azadegan St.
M.A. Jenah Exp. Way
Tehran, Iran
7/13/11
Eric Cohen
1631 East 10th Street
Brooklyn, NY
Biznest, LTD and Yeraz, LTD
Room 927 9/F Far East Consortium Building
121 Des Voeux Road C
Central District, Hong Kong
Micro Power Engineering Group (MPEG)
Anwar Street, 1st Floor
Abou Karam Building
Jdeidet El Metn
Beirut, Lebanon
Narinco Micro Sarl
Dedeyan Center
Dora Boulevard Street
Bauchrieh Metn, Lebanon
Serop Elmayan and Sons Lebanon and Serpico Offshore Sari
Ground Floor, Aramouni Building
Property Number 1731, Fleuve Street
Mar Mekhael Sector, Beirut, Lebanon
BIS In The News
7/20/11
· BIS Promises Improved Trade With US Allies
7/20/11
· BIS Adds Six Companies to Entity List for Sending Components for Improvised
Explosive Devices to Iraq and Iran
7/15/11
· Proposed Rule on Proposed Revisions to the Export Administration Regulations
(EAR): Control of Items the President Determines No Longer Warrant Control Under
the US Munitions List (USML) 76 FR 419858
7/13/11
· Addition of the New State of the Republic of South Sudan 76 FR 41046
FREE EDUCATIONAL WEBINAR
BIS 101: Real
Life Examples of Export Control & Anti-Boycott Violations
Thursday, July 28, 2011 3-4PM (ET)
The U.S. Department
of Commerce’s Bureau of Industry and Security (BIS) is responsible for administering
and enforcing export controls on U.S. commercial products, software and technology.
BIS also oversees export controls on “dual-use” items that can be used
in weapons of mass destruction applications, terrorist activities or human rights
abuses. And it is an ever-changing and complex area of compliance that could lead
to catastrophic fines for companies that miss meeting BIS compliance. In this webinar,
BIS expert Douglas Jacobson, Esq., will provide a detailed overview of current BIS
compliance regulations and what could happen if your institution is found in violation
of anti-boycott laws. Jacobson also will detail what has happened to companies found
to have violated BIS requirements – a fate your institution needs to avoid.
Speaker: Doug Jacobson, Esq.,
Law Office of Douglas N. Jacobson, PLLC.
QUESTION:
Are we only required to review individuals who we pay or receive
payment from "directly," i.e., we pay an insurance brokerage who has several
individual "agents" in that office. We don't pay them directly, but we
pay the main brokerage company...we aren't responsible for the individual "agents"
in the company, correct?
ANSWER:
Although you may not be liable for payments made by the brokerage firm that violate
OFAC sanctions, you can help reduce your exposure or risk by obtaining a contract
in which the brokerage firm agrees that they will not engage in any business or
practice that is in violation of U.S. law. This would include OFAC sanctions and
any other laws that might be applicable.
ATTENTION READERS
What OFAC & BIS topics or issues would you like to read about? How can we make
this newsletter better for you? Please
submit your thoughts, questions or comments here. Take a minute to send
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