Update: On April 27, 2020, CBP issued a set of frequently asked questions for exporters about the temporary rule issued by FEMA on April 10, 2020 requiring FEMA’s approval for exports from the United States of five types of PPE. Click here to read the CBP frequently asked questions.

The Federal Emergency Management Agency (“FEMA”) announced in an April 10, 2020 Federal Register notice that exporters will require approval from FEMA to export from the United States five types of personal protective equipment (“PPE”), subject to an exemption for certain continuous exports. The rule is effective from April 7, 2020 through August 10, 2020.

Under the rule, Customs and Border Protection (“CBP”) will temporarily detain any shipment of covered gloves, masks, or respirators, as defined below, to allow FEMA to determine which PPE to return for domestic use and purchase by FEMA or to allow, in whole or in part, to be exported from the United States. FEMA will make these determinations “within a reasonable time of being notified of an intended shipment.”

Continue Reading FEMA Restricts Exports from US of Personal Protective Equipment, Until August 10, 2020

Today, the U.S. Commerce Department’s Bureau of Industry and Security (“BIS”) is publishing a new set of regulations tightening export controls on China, Russia and Venezuela (the new “Rule”).  The new Rule will take effect on June 29, 2020, and will apply to goods, software and technology subject to U.S. export controls jurisdiction – it will not be limited to U.S. persons.

The most significant parts of this new Rule will increase the licensing requirements and due diligence expectations that apply to trade with China, Russia and Venezuela under the U.S. Export Administration Regulations (“EAR”) when “military end users” or “military end uses” are involved.  However, in light of the way these terms are defined, industry should note that the impact of this new Rule will extend into many areas of commercial technology and trade with these countries, beyond the defense sector.

In two additional rulemakings published today, BIS is removing one license exception under the EAR (CIV) and proposing to modify another EAR license exception (APR).

Continue Reading Commerce Issues Long-Awaited Export Control Rules for China, Russia and Venezuela

On April 22, President Trump signed a proclamation titled “Proclamation Suspending Entry of Immigrants Who Present a Risk to the US Labor Market During the Economic Recovery Following the COVID-19 Outbreak.” This proclamation followed the president’s tweets about plans to suspend US immigration due to the COVID-19 pandemic.

While these developments raised many questions and concerns, the scope of the proclamation is limited. Under the current state of affairs with COVID-19 related closures of consulates and embassies, the proclamation will have no immediate impact. Its overall, long-term, impact will depend largely upon whether it is extended beyond its current 60-day duration.

Continue Reading Client Alert: President Trump’s COVID-19 Immigration Proclamation Has Limited Scope

On April 19, following the issuance of an executive order by President Trump, US Customs and Border Protection (“CBP”) and the US Department of the Treasury (“Treasury”) announced a 90-day deferral of certain estimated duties, taxes, and fees that an importer of record would ordinarily be obligated to pay on merchandise imported into the United States.  The temporary final rule will extend the due date of covered duties, taxes, and fees, without interest, for a period of 90 days from the date that the duty deposit would otherwise have been due.  The temporary final rule includes a waiver of the regulatory requirement to deposit estimated duties, taxes, and fees for the purpose of establishing the time of entry in those instances where it would otherwise be required under 19 C.F.R. § 141.68, but otherwise does not modify existing procedures for entry.  Duty deferrals will be granted only for entries, or withdrawals from warehouse, for consumption, made on or after March 1, 2020 and no later than April 30, 2020, and no deferrals will be granted in any case where payment has already been made.

Continue Reading Trump Administration Announces 90-Day Duty Deferral

Many foreign nationals have found themselves unexpectedly unable to depart the United States due to the COVID-19 pandemic. This presents a particular challenge for individuals present in the United States under the Visa Waiver Program (VWP), often referred to as ESTA, a category which precludes standard status extension options. In response to COVID-19, the US Customs and Border Protection has taken steps to facilitate the ability of VWP travelers to lawfully remain in the US beyond the allowed 90-day period of stay. This Client Alert discusses this option as well as recent tax policy developments intended to address the US tax consequences facing many VWP travelers.

The COVID-19 pandemic’s global impact does not automatically change compliance rules for immigration, tax, or any other area of law. However, the pandemic has brought about an ever-changing series of accommodations and exceptions, each with their own limits and requirements. The recent CBP and IRS guidance are perfect examples, and the longer we are affected by the COVID-19 pandemic, the more such developments will emerge.

To read the full Client Alert, click here.

On March 9, 2020, a new US federal firearms export control rule (the Rule) that has been in the works for many years went into effect, changing the way the United States regulates international trade in firearms, guns, ammunition and related articles. Essentially, the Rule makes the US Commerce Department responsible for the regulation of most commercially available firearms exports and enforcement of those regulations, rather than the US State Department. While the Rule should come as a welcome relief to firearms manufacturers and dealers, as it will reduce the procedural burdens and costs of export compliance, it does not deregulate the items transferred to Commerce. In fact, Commerce is expected to be just as exacting in its civil/administrative regulation of the firearms trade, and just as tough in criminal enforcement.

Continue Reading US Civilian Firearms Exporters Take Heed as Commerce Department Takes Lead Over Enforcement under New Rule

Following Steptoe’s Client Advisory of April 7, 2020, “US and EU Sanctions Policies on Humanitarian Exports and COVID-19 Relief,” the US Office of Foreign Assets Control (OFAC) issued a Fact Sheet on April 16, “Provision of Humanitarian Assistance and Trade to Combat COVID-19,” which provides additional information on OFAC policies covered in the Client Advisory.

Click here for our interactive chart of General Licenses and license exceptions for humanitarian transactions contained in the OFAC regulations and the Export Administration Regulations (EAR).

In a series of Frequently Asked Questions (“FAQs”) released on March 31, 2020, the U.S. State Department’s Directorate of Defense Trade Controls (“DDTC”) issued new clarifying guidance for companies with ongoing business based on expired Technical Assistance Agreements (“TAAs”) or Manufacturing License Agreements (“MLAs”) under the International Traffic in Arms Regulations (“ITAR”).  Companies in the defense sector should take note of these FAQs, which highlight important limitations on the use of expired TAAs and MLAs.

TAAs and MLAs authorize U.S. persons to export (and non-U.S. persons to exchange outside the United States) ITAR-controlled technical data and “defense services.”  An MLA can also authorize the provision of manufacturing rights or know-how.  MLAs and TAAs typically have a 10 year duration, and questions often arise about what activity can and cannot continue if an agreement expires without obtaining a new or rebaselined agreement.  The non-U.S. parties to the agreement at that point may have developed or produced information or products derived from ITAR-controlled technical data and U.S.-origin manufacturing rights or know-how, and the underlying commercial relationships or agreements may be ongoing after the ITAR authorization has expired.  For example, the non-U.S. parties may have continuing sales contracts or opportunities, or obligations such as repairs and maintenance.  So, which types of activity under the ITAR can continue without a renewed MLA or TAA in place, and which types of activity require additional authorization?  DDTC has provided some useful answers in these new FAQs.

Continue Reading Expired MLA or TAA? New Guidance Clarifies that Certain Activity under an ITAR Agreement Can Continue

Exporters, non-governmental organizations, financial institutions, and individuals that are subject to US jurisdiction may require a license from the US Treasury Department’s Office of Foreign Assets Control (OFAC) to support COVID-19 relief efforts in territories subject to comprehensive US sanctions (e.g., Crimea, Cuba, Iran, North Korea, Syria) and territories whose governments are subject to stringent US sanctions (e.g., Venezuela). Their shipments may also be subject to the Export Administration Regulations (EAR). EU persons are also subject to EU sanctions regulations, which may differ significantly from US sanctions.

In this advisory we provide a brief summary of humanitarian general licenses (GLs) and license exceptions that may apply to COVID-19 relief efforts and other humanitarian activities. To assist in navigating these complex rules, we also provide a chart of relevant GLs and license exceptions contained in OFAC regulations and the EAR.

Click here to read the full Client Advisory.

Click here to access the interactive chart of US humanitarian general licenses.