The Daily Bugle Weekly Highlights: Week 19 (6 – 10 May 2019)

Every Monday we post the highlights out of last week’s FCC Export/Import Daily Update (“The Daily Bugle”). Send out every business day to approximately 6,500 readers of changes to defense and high-tech trade laws and regulations, The Daily Bugle is a free daily newsletter from Full Circle Compliance, edited by James E. Bartlett III, Alexander P. Bosch, Vincent J.A. Goossen, and Alex Witt.

We check the following sources daily: Federal Register, Congressional Record, Commerce/AES, Commerce/BIS, DHS/CBP, DOE/NRC, DOJ/ATF, DoD/DSS, DoD/DTSA, FAR/DFARS, State/DDTC, Treasury/OFAC, White House, and similar websites of Australia, Canada, U.K., and other countries and international organizations.  Due to space limitations, we do not post Arms Sales notifications, Denied Party listings, or Customs AD/CVD items. To subscribe, click here.

Last week’s highlights of The Daily Bugle included in this edition are:

    1. DHS/ICE: “Chicago-Area Man Convicted of Conspiring to ‘Straw Purchase’ Handguns for Export to Egypt”; The Daily Bugle; Monday, 6 May 2019, Item #3;
    2. DoD/DSS Announces eMASS as the Official System of Record for Assessment and Authorization (A&A) Actions; The Daily Bugle; Monday, 6 May 2019, Item #5;
    3. State/DDTC Launches NewDECCS Commodity Jurisdiction Application, Publishes Public Comments Regarding Review of USML Categories IV and XV; The Daily Bugle; Wednesday, 8 May 2019, Item #4;
    4. U.S. President Imposes Sanctions Against Iranian Iron, Steel, Aluminum, and Copper Sectors; The Daily Bugle; Friday, 10 May 2019, Item #1;
    5. UK Government Publishes Guidance Concerning Russia Sanctions; The Daily Bugle; Friday, 10 May 2019, Item #6;

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1. DHS/ICE: “Chicago-Area Man Convicted of Conspiring to ‘Straw Purchase’ Handguns for Export to Egypt”

(Source:DHS/ICE, 6 May 2019.)

A federal jury on Wednesday convicted a Chicago-area man of conspiring to “straw purchase” several handguns on behalf of a woman who allegedly tried to smuggle the weapons into Egypt.

This conviction was announced by the following agency heads: U.S. Attorney John R. Lausch Jr., Northern District of Illinois; Special Agent in Charge James M. Gibbons, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); and Superintendent Eddie Johnson, Chicago Police Department. U.S. Customs and Border Protection also provided valuable assistance to this investigation.

Omran Ismail, 53, of Burbank, Illinois, was found guilty of both counts against him: one count of conspiracy to knowingly make a materially false statement to a licensed dealer and knowingly and willfully smuggle firearms on a common carrier, and one count of acquiring a firearm from a licensed dealer by means of a materially false statement.

Evidence at trial revealed that in November 2013, Ismail purchased four handguns from a licensed firearms dealer in Tinley Park, Illinois, and then immediately transferred the guns to co-defendant Ola Sayed so that Sayed could bring them to Egypt.

The guns were discovered in Sayed’s checked luggage at O’Hare International Airport in Chicago as she attempted to board a flight to Cairo, Egypt, via London.

Sayed, 47, of Palos Park, Illinois, was charged in the conspiracy but fled and is considered a fugitive.

The conspiracy count carries a maximum sentence of five years in federal prison; the straw purchasing count is punishable by up to 10 years.

“Straw purchasers play a crucial role in enabling the unlawful possession of guns and the violence that could follow,” said U.S. Attorney Lausch. “We will continue to work with our law enforcement partners to hold accountable those who engage in these illicit transactions.”

According to evidence presented at the three-day trial, Ismail purchased four 9mm firearms from the dealer on Nov. 18, 2013.

Sayed accompanied Ismail to the gun store, and Ismail falsely represented to the dealer that Sayed was his wife.

When he purchased the firearms, Ismail completed a federal form falsely certifying that he was the “actual buyer.”

Ismail picked up the guns from the dealer five days later, at which time he confirmed that all of his answers on the form were “still true, correct, and complete.”

Ismail then immediately transferred all four firearms to Sayed, so that Sayed could take the firearms with her to Egypt.

Sayed purchased two additional 9mm firearms, and then took all six guns with her to O’Hare Airport on Dec. 23, 2013, according to the charges pending against her.

Authorities at the airport discovered the guns in Sayed’s checked luggage as she waited to board her flight, the charges allege.

Assistant U.S. Attorneys Abigail L. Peluso and Katie M. Durick, Northern District of Illinois, prosecuted this case for the government.

U.S. District Judge Sara L. Ellis set sentencing for Dec. 3, 2019.

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2. DoD/DSS Announces eMASS as the Official System of Record for Assessment and Authorization (A&A) Actions

(Source:DoD/DSS, 6 May 2019.)

The NISP instance of the Enterprise Mission Assurance Support Service (eMASS) is now the official system of record for Assessment and Authorization (A&A) actions.   In addition to completing all the NISP eMASS Account prerequisites (SAAR, Cyber Awareness Challenge Training, and eMASS Computer Based Training), Industry users must complete the New User Registration in the NISP eMASS instance.

Once the New User Registration is complete, Industry user accounts can be activated.  The NISP eMASS Account and Access Procedures Job Aid is posted on the NISP eMASS Information and Resource Center.

Note:  DISA has identified an issue with New User Registration when accessing NISP eMASS via an ECA.  DISA is implementing a patch that will resolve this issue by May 10th. If you have any questions or concerns, please contact the NAO eMASS Mailbox.

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3. State/DDTC Launches NewDECCS Commodity Jurisdiction Application, Publishes Public Comments Regarding Review of USML Categories IV and XV

(Source:State/DDTC, 6 May 2019.)

NewDECCS Commodity Jurisdiction Application

DDTC’s latest Defense Export Control and Compliance System (DECCS) application, Commodity Jurisdiction, is now live!  The Commodity Jurisdiction application incorporates the existing web-based system for electronic CJ submission into the updated DECCS platform. The system now provides the capability to save CJ requests as drafts, removing the need to complete the entire form in one sitting.  Once finalized, users can also download a PDF version of the submitted form for record-keeping purposes.

Here are a few things you will need to know to use the new application:

  – Type of Inquiries: The purpose of a commodity jurisdiction (CJ) request is to determine whether an item or service is covered by the U.S. Munitions List (USML) and therefore subject to export controls administered by the U.S. Department of State pursuant to the Arms Export Control Act and the International Traffic in Arms Regulations (ITAR). If after reviewing the USML and other relevant parts of the ITAR, in particular ITAR §120.3, §120.4, and §121.1(b), you are unsure of the export jurisdiction of an item or service, you should request a CJ determination.

  – Access: All current DTrade Super Users with valid email addresses have been automatically enrolled in DECCS and can currently access the application. If you are not a DTrade Super User, you will be able to enroll and create a new DECCS account to access the application. Learn more about DECCS here.

Access the new Commodity Jurisdiction Application on the DECCS Industry Service Portal here

Additional information and learning resources, including application user guides and overview videos, are available on the DECCS Industry Service Portal under the “Learning Tools” dropdown menu.  Also see the CJ section on our web site, under “Conduct Business”.

For questions about the CJ process, please contact the Response Team at 202-663-1282 or DDTCResponseTeam@state.gov.  For technical issues please contact the DTAS Help Desk at 202-663-2838 or DTradeHelpDesk@state.gov.

As you begin to use the new application, please continue to use the blue ‘Submit Feedback’ button on the right hand side of the Industry Portal screen to share any issues or improvement ideas you have. We appreciate your ongoing feedback as we work to refine the application with each new iteration. Thank you!

Public Comments Regarding Review of United States Munitions List Categories IV and XV

The public comments are available here.

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4. U.S. President Imposes Sanctions Against Iranian Iron, Steel, Aluminum, and Copper Sectors

(Source:Federal Register, 10 May 2019.)

Executive Order 13871 of May 8, 2019 — Imposing Sanctions With Respect to the Iron, Steel, Aluminum, and Copper Sectors of Iran

By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), section 212(f) of the Immigration and Nationality Act of 1952 (8 U.S.C. 1182(f)), and section 301 of title 3, United States Code, I, DONALD J. TRUMP, President of the United States of America, find that:

It remains the policy of the United States to deny Iran all paths to both a nuclear weapon and intercontinental ballistic missiles, and to counter the totality of Iran’s malign influence in the Middle East. It is also the policy of the United States to deny the Iranian government revenue, including revenue derived from the export of products from Iran’s iron, steel, aluminum, and copper sectors, that may be used to provide funding and support for the proliferation of weapons of mass destruction, terrorist groups and networks, campaigns of regional aggression, and military expansion.

In light of these findings and in order to take further steps with respect to the national emergency declared in Executive Order 12957 of March 15, 1995, and to supplement the authorities provided in the Iran Freedom and Counter-Proliferation Act of 2012 (subtitle D of title XII of Public Law 112-239), I hereby order:

Section 1. (a) All property and interests in property that are in the United States, that hereafter come within the United States, or that are or hereafter come within the possession or control of any United States person of the following persons are blocked and may not be transferred, paid, exported, withdrawn, or otherwise dealt in: any person determined by the Secretary of the Treasury, in consultation with the Secretary of State:

(i) to be operating in the iron, steel, aluminum, or copper sector of Iran, or to be a person that owns, controls, or operates an entity that is part of the iron, steel, aluminum, or copper sector of Iran;

(ii) to have knowingly engaged, on or after the date of this order, in a significant transaction for the sale, supply, or transfer to Iran of significant goods or services used in connection with the iron, steel, aluminum, or copper sectors of Iran;

(iii) to have knowingly engaged, on or after the date of this order, in a significant transaction for the purchase, acquisition, sale, transport, or marketing of iron, iron products, aluminum, aluminum products, steel, steel products, copper, or copper products from Iran;

(iv) to have materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services in support of any person whose property and interests in property are blocked pursuant to this section; or

(v) to be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant to this section.

(b) The prohibitions in this section apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted before the date of this order.

Sec. 2. (a) The Secretary of the Treasury, in consultation with the Secretary of State, is hereby authorized to impose on a foreign financial institution the sanctions described in subsection (b) of this section upon determining that the foreign financial institution has, on or after the date of this order, knowingly conducted or facilitated any significant financial transaction:

(i) for the sale, supply, or transfer to Iran of significant goods or services used in connection with the iron, steel, aluminum, or copper sectors of Iran;

(ii) for the purchase, acquisition, sale, transport, or marketing of iron, iron products, aluminum, aluminum products, steel, steel products, copper, or copper products from Iran; or

(iii) for or on behalf of any person whose property and interests in property are blocked pursuant to this order.

(b) With respect to any foreign financial institution determined by the Secretary of the Treasury in accordance with this section to meet any of the criteria set forth in subsection (a)(i) through (a)(iii) of this section, the Secretary of the Treasury may prohibit the opening, and prohibit or impose strict conditions on maintaining, in the United States of a correspondent account or payable-through account by such foreign financial institution.

(c) The prohibitions in subsection (b) of this section apply except to the extent provided by statutes, or in regulations, orders, directives, or licenses that may be issued pursuant to this order, and notwithstanding any contract entered into or any license or permit granted before the date of this order.

Sec. 3. I hereby determine that the making of donations of the types of articles specified in section 203(b)(2) of IEEPA (50 U.S.C. 1702(b)(2)) by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to this order would seriously impair my ability to deal with the national emergency declared in Executive Order 12957, and I hereby prohibit such donations as provided by this section.

Sec. 4. The prohibitions in section 1 of this order include:

(a) the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to subsection (a) of that section; and

(b) the receipt of any contribution or provision of funds, goods, or services from any such person.

Sec. 5. The unrestricted immigrant and nonimmigrant entry into the United States of aliens determined to meet one or more of the criteria in subsection 1(a) of this order would be detrimental to the interests of the United States, and the entry of such persons into the United States, as immigrants or nonimmigrants, is therefore hereby suspended. Such persons shall be treated as persons covered by section 1 of Proclamation 8693 of July 24, 2011 (Suspension of Entry of Aliens Subject to United Nations Security Council Travel Bans and International Emergency Economic Powers Act Sanctions).

Sec. 6. (a) Any transaction that evades or avoids, has the purpose of evading or avoiding, causes a violation of, or attempts to violate any of the prohibitions set forth in this order is prohibited.

(b) Any conspiracy formed to violate any of the prohibitions set forth in this order is prohibited.

Sec. 7. Nothing in this order shall apply to transactions for the conduct of the official business of the Federal Government or the United Nations (including its specialized agencies, programmes, funds, and related organizations) by employees, grantees, or contractors thereof.

Sec. 8. For the purposes of this order:

(a) the term “entity” means a partnership, association, trust, joint venture, corporation, group, subgroup, or other organization;

(b) the term “foreign financial institution” means any foreign entity that is engaged in the business of accepting deposits, making, granting, transferring, holding, or brokering loans or credits, or purchasing or selling foreign exchange, securities, commodity futures or options, or procuring purchasers and sellers thereof, as principal or agent. It includes, but is not limited to, depository institutions, banks, savings banks, money service businesses, trust companies, securities brokers and dealers, commodity futures and options brokers and dealers, forward contract and foreign exchange merchants, securities and commodities exchanges, clearing corporations, investment companies, employee benefit plans, dealers in precious metals, stones, or jewels, and holding companies, affiliates, or subsidiaries of any of the foregoing. The term does not include the international financial institutions identified in 22 U.S.C. 262r(c)(2), the International Fund for Agricultural Development, the North American Development Bank, or any other international financial institution so notified by the Secretary of the Treasury;

(c) the term “Government of Iran” includes the Government of Iran, any political subdivision, agency, or instrumentality thereof, including the Central Bank of Iran, and any person owned or controlled by, or acting for or on behalf of, the Government of Iran;

(d) the term “Iran” means the Government of Iran and the territory of Iran and any other territory or marine area, including the exclusive economic zone and continental shelf, over which the Government of Iran claims sovereignty, sovereign rights, or jurisdiction, provided that the Government of Iran exercises partial or total de facto control over the area or derives a benefit from economic activity in the area pursuant to international arrangements;

(e) the term “knowingly,” with respect to conduct, a circumstance, or a result, means that a person has actual knowledge, or should have known, of the conduct, the circumstance, or the result;

(f) the term “person” means an individual or entity; and

(g) the term “United States person” means any United States citizen, permanent resident alien, entity organized under the laws of the United States or any jurisdiction within the United States (including foreign branches), or any person in the United States.

Sec. 9. For those persons whose property and interests in property are blocked pursuant to this order who might have a constitutional presence in the United States, I find that because of the ability to transfer funds or other assets instantaneously, prior notice to such persons of measures to be taken pursuant to this order would render those measures ineffectual. I therefore determine that for these measures to be effective in addressing the national emergency declared in Executive Order 12957, there need be no prior notice of a listing or determination made pursuant to section 1 of this order.

Sec. 10. The Secretary of the Treasury, in consultation with the Secretary of State, is hereby authorized to take such actions, including adopting rules and regulations, and to employ all powers granted to the President by IEEPA as may be necessary to implement this order. The Secretary of the Treasury may, consistent with applicable law, redelegate any of these functions within the Department of the Treasury. All agencies shall take all appropriate measures within their authority to implement this order.

Sec. 11. (a) Nothing in this order shall be construed to impair or otherwise affect:

(i) the authority granted by law to an executive department or agency, or the head thereof; or

(ii) the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.

(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.

(c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.

Sec. 12. The measures taken pursuant to this order are in response to actions of the Government of Iran occurring after the conclusion of the 1981 Algiers Accords, and are intended solely as a response to those later actions.

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5. UK Government Publishes Guidance Concerning Russia Sanctions

(Source:GOV.UK, 9 May 2019.) [Excerpts.]

The Russia (Sanctions) (EU Exit) Regulations 2019 are intended to ensure that certain sanctions relating to Russia, which are currently in force in the UK under EU legislation and related UK regulations, continue to operate effectively after the UK leaves the EU.

This sanctions regime is aimed encouraging Russia to cease actions destabilizing Ukraine or undermining or threatening the territorial integrity, sovereignty or independence of Ukraine. When these regulations come into force they will replace, with substantially the same effect, relevant existing EU legislation and related UK regulations. …