Photo of Ed Krauland

Edward J. Krauland focuses on export controls/economic sanctions. Ed’s extensive experience includes representing clients on matters involving US and multilateral economic sanctions, defense and nuclear export controls, dual-use export controls under the EAR, anti-boycott compliance, internal investigations and enforcement work, and review of government procurement regulations in the cross-border context. His practice spans all aspects of these laws, including counseling, compliance work, transactional advice, licensing and opinion work, internal reviews, disclosures, and enforcement actions. He has served as co-chair of the International Trade Committee of the ABA Section of International Law and Practice. He is former Chairman of an ABA-wide Task Force on Gatekeeper Regulation (anti-money laundering compliance), and senior adviser to the ABA Section of International Law and Practice’s anti-money laundering committee.

Read Ed's full bio.

On February 23, 2024, the United States issued a broad set of new Russia-related sanctions and export controls in response to the second anniversary of Russia’s invasion of Ukraine and the February 16, 2024, death of opposition leader, Aleksey Navalny, in Russian custody.

The Treasury Department’s Office of Foreign Assets Control (OFAC), the Commerce Department’s Bureau of Industry and Security (BIS), and the State Department all issued new designations.  The agencies also issued an inter-agency advisory warning non-Russian companies from doing business in or with Russia.Continue Reading US Government Imposes New Russia Sanctions, Designating Over 500 Parties and Issuing Interagency Russia Business Advisory

The U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) has published major revisions to its humanitarian authorizations and other general licenses under the North Korean Sanctions Regulations (“NKSR”), which took effect on February 16, 2024.  These regulatory changes expand the scope of authorized activity in North Korea, which should lead to fewer specific license applications for NGOs engaged in humanitarian work relating to the DPRK.  In this regard, OFAC has narrowed the restriction on authorized activity arising from “partnerships” with the DPRK government.  OFAC has also established a new authorization for journalistic activities in North Korea.  These revisions to the NKSR, along with some improved guidance from OFAC regarding banks’ due diligence expectations, may result in less de-risking by financial institutions when it comes to customer activity involving North Korea.

At the same time, there remain important limitations and conditions to these authorizations that must be observed.  Moreover, OFAC has implemented a new advance reporting requirement if one intends to use the revised humanitarian general license, which may increase the compliance burden on NGOs as well as provide the State Department an opportunity to object to the use of the general license on a case-by-case basis. Continue Reading OFAC Issues Significantly Revised NGO Authorizations for North Korea

On January 16, 2024, the Assistant Secretary for Export Enforcement at the Department of Commerce’s Bureau of Industry and Security (BIS) issued a memorandum, announcing that:

  1. parties disclosing minor or technical violations that occurred close in time can submit a single Voluntary Self-Disclosure (VSD) on a quarterly basis, which may include an abbreviated narrative account of the suspected violations; and
  2. parties sending formal requests to BIS’s Office of Exporter Services to engage in otherwise prohibited activities with respect to items involved in violations of the Export Administration Regulations (EAR) should also send courtesy copies to the Office of Export Enforcement (OEE), which will help expedite BIS’s processing of such requests.

The memorandum builds upon previous changes to BIS’s administrative enforcement program, which were announced in memoranda dated June 30, 2022 and April 18, 2023.  These changes are intended to help OEE fast-track its review of “minor” or “technical” VSDs and to encourage additional disclosures of potentially significant violations of the EAR, but do not apply to VSDs relating to Part 760 of the EAR (antiboycott and restrictive trade practices).  For a detailed analysis of the previous memoranda, see our blog posts from July 6, 2022 and April 26, 2023.  Continue Reading BIS Makes Further Changes to Administrative Enforcement, But Questions Remain

Effective August 18, 2023, the U.S. Department of Commerce, Bureau of Industry and Security (BIS) issued amendments to the Commerce Control List (CCL) (15 CFR Part 774) of the Export Administration Regulations (EAR) to formalize changes based on Nuclear Supplier Group (NSG) commitments to prevent nuclear proliferation and the development of nuclear-related weapons of mass destruction.Continue Reading BIS Promulgates CCL Changes Based on Nuclear Supplier Group Commitments

On August 11, 2023, the U.S. Nuclear Regulatory Commission (“NRC”) and the U.S. Department of Commerce, Bureau of Industry & Security (“BIS”) announced amendments to their existing regulations concerning exports of nuclear materials and related equipment destined for China and Macau. (BIS extends its export controls policies and regulations applicable to China to the territory of Hong Kong.) Although the notice from the NRC provided little explanation, the notice issued by BIS explained that the change in the Export Administration Regulations (15 CFR Parts 730-774 or EAR) is based on an increased concern with China’s military-civil fusion policy and efforts to expand its military nuclear capability. The changes implemented by the NRC are effective as of August 8, 2023, and the changes implemented by BIS are effective as of August 11, 2023. Continue Reading U.S. Government Revises Export Controls Regarding Commercial Nuclear Commerce with China

Overview

On August 9, 2023, the White House issued a long-awaited Executive Order, entitled Addressing United States Investments in Certain National Security Technologies and Products in Countries of Concern (“EO 14105”). The EO establishes a new national security regulatory regime, implemented principally by the US Department of the Treasury (“Treasury”), in consultation with other federal agencies including the US Department of Commerce, that will require the notification of, as well as prohibit, certain investment activity by US persons in named “countries of concern,” currently China.

EO 14105 does not restrict all US person investment activity regarding China, and is tailored to focus on specific products, technologies, and capabilities involving: (1) semiconductors and microelectronics (including advanced integrated circuits and supercomputers); (2) quantum information technologies (e.g., computers, sensors, networking, and systems); and (3) certain artificial intelligence systems (e.g., with certain military, intelligence, or surveillance end uses).Continue Reading Biden Administration Announces New Outbound Investment Regime Targeting China

On July 26, 2023, Assistant Secretary for Export Enforcement Matthew Axelrod of the US Department of Commerce’s Bureau of Industry and Security (“BIS”) spoke at the Society for International Affairs “Back to Basics” conference about BIS’s recent efforts to build partnerships in export controls regulation and enforcement and developments in antiboycott rules.  In his address, Assistant Secretary Axelrod likened the Marvel cinematic universe—the blockbuster superhero films that feature intertwined characters and storylines—with the current export control landscape.  By way of this analogy, Assistant Secretary Axelrod articulated BIS’s view that an ensemble cast of its interagency colleagues, international partners, private industry, and academia is central to a successful export control strategy.Continue Reading Assistant Secretary for Export Enforcement Matthew Axelrod Addresses Recent Developments in Export Controls and Antiboycott Regulations

On July 26, 2023, the US Department of Commerce’s Bureau of Industry and Security (BIS), the US Department of the Treasury’s Office of Foreign Assets Control (OFAC), and the US Department of Justice (DOJ) issued a joint compliance note (the Note) focusing on the voluntary self-disclosure (VSD) policies that apply to US sanctions, export controls, and other national security laws. The Note is the second collective effort by the three agencies to inform the private sector about civil and criminal enforcement trends, as well as to provide guidance to the business community and all persons regarding compliance with US sanctions and export laws. The first joint note, which focused on combatting third-party intermediaries used to evade Russia-related US sanctions and divert export-controlled items that are contributing to Russia’s foreign harmful activities, was issued on March 2, 2023.

The Note does not change the existing VSD policies of the three agencies, but highlights the benefits of their existing VSD policies to incentivize companies to promptly disclose and remediate.  Likewise, the Note highlights the risks companies face, in at least some instances, should they choose not to disclose.

The Note also encourages whistleblowers to report suspected violations of sanctions and anti-money laundering laws to the US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN), for which persons that submit whistleblower tips may be awarded up to 10% to 30% of the monetary penalty collected for successful US government enforcement actions.Continue Reading Commerce, Treasury, and Justice Issue Joint Compliance Note on Voluntary Self-Disclosure

On June 16, 2023, the US Department of Commerce published a final rule (the “June 16 rule”) to implement Executive Order (EO) 14034, Protecting Americans’ Sensitive Data From Foreign Adversaries, by amending Commerce’s previously-issued Securing the Information and Communications Technology Supply Chain regulations (the “ICTS rule”).   Among other requirements, EO 14034 directed the Secretary of Commerce to consider the risks posed by “connected software applications” and take “appropriate action” in accordance with the previously issued ICTS rule and EO 13873, Securing the Information and Communications Technology and Services Supply Chain, pursuant to which the ICTS rule was issued. 

The ICTS rule authorizes Commerce to prohibit or otherwise regulate certain transactions involving information and communications technology or services (“ICTS”) with a nexus to “foreign adversaries” that pose an “undue or unacceptable risk” to US national security.  (For additional detail on the ICTS rule, see our prior blog post.)  The June 16 rule amends the ICTS rule to clarify Commerce’s ability to regulate transactions involving software, including so-called “connected software applications,” and to further enumerate the criteria that Commerce will consider when reviewing such transactions.   The changes are effective July 17, 2023.Continue Reading Commerce Issues Final Rule Targeting Connected Software Applications

On June 9, 2023, the US Departments of Commerce, Justice, State, and the Treasury published a joint advisory and guidance (the “Guidance”) related to Iran’s procurement, development, and proliferation of unmanned aerial vehicles (“UAVs”).  Notably, the agencies warned industry participants that key components of Iranian UAVs are US-origin technologies, some of which are “low-technology items” that are designated as EAR99, i.e., not included on the Commerce Control List (“CCL”), Supplement No. 1 to part 774 of the EAR.  The Guidance provides specific Harmonized System (HS) codes that exporters/reexporters may use to identify items that are of diversion/transshipment concern.

Further, the agencies provided clear guidance on the US government’s expectations for private industry compliance programs, identified numerous red flags for industry participants, and highlighted several best practices for how to address a red flag. 

This Guidance is the most recent activity in a series of measures implemented by US government agencies to disrupt Iran’s UAV program.  The Guidance may signal an increased focus on both US and non-US manufacturers and suppliers of commodities that can be used in the production of UAVs.Continue Reading New US Interagency Guidance Targets Iranian UAVs and Compliance Risks