Export Control Blog

Ack, very little time to blog lately, but here's a quick one -- DaimlerChrysler is under investigation by the Bundesamt für Wirtschaft und Ausfuhrkontrollein (BAFA or Federal Office of Economics and Export Control) in Germany, Bloomberg reports, for the export of some trucks with potential military applications to Iran.

In an otherwise routine AP story about a Michigan couple who are appealing an OFAC administrative law judge's decision to fine them for travel-related transactions in Cuba, there's an interesting factoid I haven't seen elsewhere:

The typical fine for first-time offenders who travel to Cuba is $7,500 each, according to the Treasury Department's Office of Foreign Asset Control.

Hmmm...guess I'll just have to stick with Nikki Beach.

I'll try to post some of the more interesting nuggets later this week, but for now just a link -- to the annual BIS report on foreign policy export controls.

The latest OFAC civil penalties info is up (pdf).

GE is the latest company to bail out of Iran (or at least to stop taking new orders) under US pressure.

President's Export Council Subcommittee on Export Administration to contemplate controls on nanotechnology, according to the aptly-named Small Times.

An older, but rather more detailed rundown on this issue is here.

Ukraine exported cruise missiles to China and Iran in possible violation of the Missile Technology Control Regime, according to Radio Free Europe/Radio Liberty.  Equally disturbing is the alleged involvement of the Russian FSB.

A couple days ago I mentioned an upcoming export control seminar in Dubai.  A bit closer to home (my home at least) the U.S. Commercial Service here in Cleveland is organizing an introductory program for February 24.  Check out the details (you can also register online).

And if star power is an attraction, know that I'm planning to be there.

There's further detail emerging now on the story of an Irish businessman arrested in California on suspicion that he illegally attempted to export defense articles to Russia (first mentioned here earlier this week.)

Thanks to the Irish Independent, we now have the name and company in question as well as some further detail.  I'm excerpting here from their original story (registration required):

The businessman, named as Denis Sugrue (54), is originally from Galway and, according to the Companies Office, has addresses in Ireland, Moscow and Kyrgyztan.

Mr Sugrue is alleged to have purchased a high-tech piece of electronic equipment in the US called an equalizer/demodulator.

According to court documents prepared by the FBI, this could be used to "assist in the sending and interception of carrier waves (signals)".

The FBI seized these items after Mr Sugrue attempted to send them without a proper export licence back to Amideon Systems in Limerick.

The documents also claim that Sugrue said the buyer of these items was Russia's Federal State Unitary Enterprise - General Radio Frequency Centre, and that he was made aware he would need a licence to export them.

DirecTV, formerly known as Hughes Electronics, has agreed to pay $5M to settle violations of the Arms Export Control Act, according to The Washington Post:

DirecTV's subsidiary Hughes Network Systems Inc. sold equipment that can be used for voice and data transmission systems to China, India, South Korea, Turkey and South Africa, according to a settlement with the State Department. The company modified the equipment and provided services related to the sales without State Department approval in violation of export control rules. The activities also violated a 2003 settlement that followed a State Department investigation in which DirecTV, then known as Hughes Electronics Corp., and Boeing Co. agreed to pay $32 million for illegally transferring sensitive U.S. space technology to China during the 1990s.

The latest violations, which occurred between 1993 and 2003, "provided the foreign recipients with a new capability to enhance secure satellite communications," according to the State Department. Chicago-based Boeing was not named in the latest violations.

Under the latest settlement, which was finalized late last month, the department will not grant the company licenses to sell defense equipment overseas until May 14. The State Department charged the firm with 56 violations of export control and arms control regulations.

Hughes, along with Loral Communications, was a key player in one of the more famous export control sagas of the 90s, involving the transfer of space technology to China.  This time, the sort of violations sound similar except it's encryption and telecommunications technology at issue rather than rockets and satellites.

For corporate export compliance managers there was a very useful byproduct of the last Hughes case -- Nunn Wolfowitz.  To the uninitiated this may sound like the name of the new Mel Brooks musical, but in actuality I refer to the the Nunn Wolfowitz Task Force Report (pdf), a helpful summary of best practices in export controls.