Please join OCR this summer for the 2012 European Road Show on Export Compliance!

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Export activity provides immense opportunities for growth, stability and profit. With this opportunity comes risk and it is no secret that one of the largest risks any company faces when trading is compliance. Not only does international and national law & regulation continually shift and change, but stricter supervision and cooperation amongst authorities increases the burden of responsibility for compliance staff. Even brief application or processing delays can mean reduced revenue, profit, lost market share, and strains on valuable trading relationships.

Due to the complexity of modern supply chains, the role of technology continues to be increasingly important in not only supporting the compliance system but streamlining and automating processes. But the financial climate means companies can’t afford to simply throw money at implementing technology, it has to show bottom line returns and in addition any technology needs to be administered by employees who individually contribute to the integrity of the system.

So this poses an interesting question which compliance professionals the world over work daily to solve. How do you effectively manage automated systems, processes and staff, whilst saving money for your company?

Join us at one of our seminars in 2012 where we will explore this challenge in greater depth. Please also join ‘The Export Compliance Group’ on Linkedin and subscribe to the newsletter for regular updates!

The United States Department of Commerce (DOC), Bureau of Industry and Security announced that three U.S. companies have agreed to pay $35,200 USD in penalties stemming from violations of current Export Administration Regulations.

1.) Weiss-Rohlig (Cranford, NJ) has decided to pay a fine of $8,000 USD to settle 2 accusations that it violated antiboycott provisions of the Export Administration Regulations (EAR). The Bureau of Industry and Security (BIS) alleges that in 2006 in Weiss-Rohlig furnished illegal information regarding the blacklisted status of a cargo vessel. In addition, the company failed to disclose to the DOC a request to engage with a debarred trade practice or boycott.

2.) JAS Forwarding, Inc. (Los Angeles, CA) has paid a fine of $19,200 USD to settle 3 allegations regarding EAR violations. The BIS alleges in 2006 JAS Forwarding furnished illegal information in statements claiming that certain goods were not of Israeli origin nor comprised of any Israeli materials.

3.) Rexnord Industries (Milwaukee, WI) has arranged payment of an $ 8,000 USD fine stemming from 5 allegations regarding EAR violations. During the years 2007 through 2009, according to the BIS, Rexnord provided prohibited information in a declaration certifying that items were not of Israeli origin nor contained Israeli materials. On 4 separate occasions Rexnord failed to report to the Department of Commerce (DOC) the receipt of a request to engage in prohibited trade practice. Rexnord voluntarily disclosed the transactions to BIS.

Mr. Rudolf Cheung pled guilty this week to violating the U.S. Department of State, Arms Export Control Act (AECA). Mr. Cheung, a Massachusetts resident, was found conspiring to illegally export 55 antennae with military application, from the U.S. to Hong Kong and Singapore.

Serving as the head of the R&D at a private antennae manufacturing firm for over 17 years, Cheung has planned and overseen the advancement of antennae made by the firm. The firm manufactures multiple antennae for military use, subject to DOS regulations. Allegedly in June of 2006, a company located in Singapore asked for a quotation for 2 types of antennae from the firm. Both antennas fall under the jurisdiction of the U.S. Department of State and may not be exported without authorization. The firm flagged the order as needing a license and was immediately stopped.

Upon learning that the antennae export was halted, Mr. Cheung admittedly discussed with a co-conspirator a method to export the devices without proper authorization to Singapore. The co-conspirator, who operates in the United States, purchased the antennas from Cheung’s firm. The goods were then later exported illegally to a firm, Corezing in Singapore with Cheung’s knowledge. From July 2006 to September 2007, the conspirator purchased a total of 55 military antennae which were then exported to Corezing in Singapore and Hong Kong.

Mr. Rudolf Cheung faces a max sentence of 5 years in prison as well as a fine of $250,000 USD with a conditional 3 years supervised release. Both parties will be added to the U.S. Denied Party List and Debarred Party List. Until rescinded from the watch list, the denied and debarred parties are prohibited from receiving any EAR controlled goods.

For the most current list of denied parties and debarred parties, please contact OCR Services!

Last week Federal Express has settled for an amount of $370,000 USD resulting from civil charges that the company violated United States' Department of Commerce (DOC) Export Administration Regulations. The Bureau of Industry and Security charged FedEx with 3 sets of allegations:

1.) 06/2006 - Exportation of EAR controlled goods (electronic components) from the U.S. to ‘Mayrow’, located in the U.A.E., Dubai. ‘Mayrow’ is on the U.S. Restricted and Debarred Party / Denied Party list.

2.) 12/2005 - Exportation of aeronautic simulation software to Beihang University (Beijing, People’s Republic of China). The Beijing University of Aeronautics and Astronautics is listed as an identified denied trade party (restricted party) by the U.S. Department of Commerce.

3.) 2004 - Exporting controlled printer components to parties in Syria on 3 separate occasions in 2004. This is in violation of the current DOC Export Administration Regulations.

For the most current list of denied parties and debarred parties, please contact OCR Services!

The Bureau of Industry and Security (BIS) will be adding two new entities to the Department of Commerce (DOC), BIS Entity list for denied trade parties. Both parties are accused of buying internet filtering devices from the United States and sending the devices to Syria. According to evidence, Waseem Jawad ordered a number of internet filtering, proxy devices from an authorized distributer in the United Arab Emirates. Using his company, Infotec (Info Tech) in the U.A.E., he ordered the devices from the United States. Upon arrival, the proxy devices were transferred to the possession of Infotec. Approximately 3 days later, the filtering equipment was transported from the U.A.E. directly to Syria.

Due to the nature of internet filtering proxy servers being used as a tool to block the actions of pro-democracy activists by the Syrian Government, the Department of Commerce restricts and monitors exporting of these and related devices. They are classified as dual-use items by the BIS. Fines, sanctions, and criminal penalties can be forced on any entity found in violation.
Due to the evidence, both parties (Waseem Jawad and Infotec) are being added to the DOC, BIS Entity list (debarred party list). As new restricted trade parties, both are restricted from receiving any goods that are under U.S. sanction.

For more information regarding the latest Debarred Trade Parties, International Watch Lists, Denied Parties, please contact OCR Services