The Export Practitioner is the only monthly magazine devoted exclusively to news and analysis of U.S. export controls and trade sanctions.

Since 1987, The Export Practitioner has provided readers with expert reports on changes to U.S. export licensing rules, enforcement policies and regulations for defense and dual-use products and technology.

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October 2014

Features

New U.S., EU Sanctions Raise Risk of Doing Business in Russia
New sanctions on Russia are so complex and extensive that U.S. companies may need to consider whether they are willing to face the legal and economic risks of doing even non-sanctioned business in Russia.
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Export Control Implications of Cloud Computing
The most apparent concerns about cloud computing are security and privacy. The implications for export controls are less obvious to network administrators. A cloud's routers, servers and storage devices are typically hosted in multiple physical locations or data centers - oftentimes across the globe.

A U.S. company that uploads technical data to the cloud may not know where its data will be stored within the cloud. It may be routed through Germany and stored on a server in India or elsewhere.

Because U.S. export control laws regulate the shipment and transmission of controlled products, software and technology across national borders, knowing the actual trajectory and physical destination of technical data is essential to understanding whether a transmission requires an export license from the U.S. government. That knowledge will also determine the degree of export compliance that is required.

Cloud computing, therefore, poses unique export compliance challenges for cloud users and providers, in addition to the compliance issues that already exist in any other Internet context.
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Focus on Enforcement

Citigroup Pays $217,841 to Settle OFAC Charges of Violating Iran Sanctions
A company's export compliance may only be as strong as its screening software's fuzzy logic, especially when distinguishing between similar...
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Man Sentenced to Prison for Export to Venezuelan Air Force After Embargo
Ronald A. Dobek was sentenced to 84 months in prison in Milwaukee U.S. District Court Sept. 10, 2014, for conspiring to export and exporting F-16...
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Memphis Exporter Settles Charges of Ex-Im Bank Fraud for $3.5 Million
Saudi Arabia Business Association, Inc. (SABA), a Memphis-based exporter of U.S. agricultural equipment and other goods, agreed to pay $3.5 million...
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Electronic Trading Company Pays $350,000 to Settle OFAC, CFTC Sanctions Charges
Electronic trading company Zulutrade Inc. agreed Sept. 9, 2014, to pay Treasury's Office of Foreign Assets Control (OFAC) and Commodity Futures...
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Pa. Exporter Pleads Guilty to Shipping Laboratory Equipment to Syria Without Licenses
Harold Rinko of Hallstead, Pa., pleaded guilty Sept. 16, 2014, in Scranton, Pa., U.S. District Court to conspiracy to illegally export laboratory...
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Caterpillar Subsidiary Agrees to Pay $26,350 to Settle BIS Antiboycott Charges
A Caterpillar subsidiary in LaGrange, Ill., agreed to pay the Bureau of Industry and Security (BIS) a $26,350 civil penalty for failing to report...
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N.J. Defense Contractor Charged with Mail Fraud, Download of Technical Data
The former owner of two N.J. defense contracting businesses has been charged with mail fraud and violating the Arms Export Control Act (AECA) in...
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Italian Company Agrees to Pay BIS $100,000 to Settle Charge of Syrian Export
An Italian company agreed to pay $100,000 to settle charges of selling U.S.-origin network monitoring equipment to a Syrian government entity...
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Another N.J. Business Owner Charged with Fraudulent Defense Sales Contracts
In a second case of fraud in getting Defense contracts, a second N.J. business owner was charged in a superseding indictment Sept. 11, 2014, with...
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N.J. Freight Forwarder Settles BIS Charges of Exporting to Blocked Chinese Entity
A N.J. freight forwarder agreed to settle a Bureau of Industry and Security (BIS) charge of exporting equipment to a designated entity in China...
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Texas Man Sentenced to Prison for Exporting USML Items to Mexico
A Texas resident will spend more than six years in prison for illegally exporting M203 40mm grenade-launcher barrels and other items listed on the...
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Mayrow Affiliates Settle BIS Export Charges, Get Removed from Entity List
A Hong Kong company affiliated with Mayrow General Trading and the company's owner agreed to pay the Bureau of Industry and Security (BIS) civil...
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Taiwanese Nationals Plead Guilty to Attempted Export of Drones to China
Hui Sheng Shen, aka "Charlie," and Huan Ling Chang, aka, "Alice," both Taiwanese nationals, pleaded guilty Sept. 22, 2014, in Newark, N.J., U.S....
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Inside BIS

Two Years Late, Single Export IT System Misses Deadline, Needs Oversight
One of the four "singles" of export control reform, the migration to all export licensing information technology (IT) systems to USXPORTS, has...
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BIS to Assess Foreign Availability of Etching Equipment in China
In response to claims from the Semiconductor Equipment and Materials International (SEMI) industry association, Bureau of Industry and Security...
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Policy Briefs

Justice Stands Behind Fokker Settlement Based on Voluntary Disclosure
Justice is standing behind its settlement with Fokker Services on charges of violating U.S. sanctions after a federal judge questioned whether...
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Judge Grants Pulungan Chance to Contest USML Classification of Riflescopes
In a ruling on the meaning of "willfulness" in the prosecution of violations of the Arms Export Control Act (AECA), a federal judge has said the...
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BIS, State Will Ask for Public Comments on Anniversary of USML-CCL Transition Rules
Happy Anniversary! Please tell us if you are happy. The Bureau of Industry and Security (BIS) and State's Directory of Defense Trade Controls...
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Industry Group Formed to Review List Reforms and Propose Additional Changes
A group of industry representatives have formed a committee to review changes already made or proposed in the U.S. Munitions List (USML) and...
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Regulatory Briefs

Industry Responds to New Export Controls on MMIC Electronics
Industry comments to Bureau of Industry and Security (BIS) urged the agency not to put American firms at a disadvantage by imposing new controls on...
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BIS Proposes Removing Provisions of Special Comprehensive License
Citing low usage and new superseding license exceptions created under export control reform, Bureau of Industry and Security (BIS) proposed...
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BIS: Let's Try Making Those Nuclear Supplier Changes One More Time
Perhaps the Bureau of Industry and Security (BIS) needs a new proofreader. In the Sept. 5, 2014, Federal Register, BIS had to make several...
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BIS Requests Comments on Improving EAR Recordkeeping Rules
The Bureau of Industry and Security (BIS) asked for advice on changing recordkeeping requirements in the Export Administration Regulations (EAR) in...
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End Notes

END NOTES
ENTITY LIST : In Sept. 18, 2014, Federal Register, BIS added 28 persons in Afghanistan, Armenia, Australia, China, Greece, Hong Kong, India,...
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