International TradeNewsletter - February 12, 2002
In this Issue...
The U.S. Government Increases Enforcement of Export Control Laws
February 12, 2002
- Since the start of 2002, the Bureau of Export Administration, (BXA), the
agency responsible for enforcing provisions related to the export of
controlled dual-use items, has announced five enforcement actions for export
control violations. In 2001, the BXA announced 15 such violations, seven of
them after the September 11 attacks. The recent BXA enforcement actions
include: a $50,000 civil penalty and 10-year denial of export privileges
against Atlanta-based Federal Parts International, Inc, for shipment of
automobile parts to Iran; $10,000 civil penalty and five-year denial of
export privileges against an Israeli citizen for the illegal transfer of an
infrared camera; $1 million in criminal and administrative fines against a
Houston-based company, BS&B Process Systems, Inc. for illegally
exporting oil field processing equipment to Iran; the indictment of a
Japanese company on charges of participating in a conspiracy to export night
vision equipment to Japan; and a $1.12-million administrative fine and
25-year denial of export privileges on Texas-based Thane-Coat, Inc. for
exporting pipe coating material to a Libyan-government owned company.
- The U.S. Department of State, which enforces the International Traffic in
Arms Regulations, has sanctioned two Chinese companies and a Chinese
national for the transfer to Iran of equipment and technology used for the
manufacture of chemical and biological weapons. The companies are Liyang
Chemical Equipment and the China Machinery and Electric Equipment Import and
Export Company. The individual, Q.C. Chen, was not identified further. The
sanctions, which will remain in place for up to two years, prohibit the U.S.
government from doing business with the companies or from issuing them
licenses for the transfer of dual-use items, and forbid U.S. companies from
selling them items listed on the U.S. Munitions List.
- This atmosphere of heightened scrutiny highlights the need for companies
that are either based in the United States or do business in the United
States to have in place effective export compliance programs. Such programs
work to ensure that company operations do not fall afoul of U.S. export
control laws and that companies do not, inadvertently, do business with
denied or ineligible entities. Holland & Knight’s trade attorneys can
assist your company to develop or to improve your compliance program.