Arent Fox LLP updates
OFAC's new ransomware advisory
Arent Fox LLP- International Trade
- USA
- 23 October 2020
The US Department of Treasury's Office of Foreign Assets Control recently issued an advisory highlighting sanctions risks associated with facilitating ransomware payments on behalf of victims targeted by malicious cyberattacks. Relatedly, the US Department of Treasury's Financial Crimes Enforcement Network issued guidance alerting financial institutions to their role in processing ransomware and associated payments, red flags and reporting information.
Human rights now part of US export licensing review for nearly all export licences
Arent Fox LLP- International Trade
- USA
- 23 October 2020
The US Department of Commerce, Bureau of Industry and Security (BIS) recently released a final rule revising its licensing policy for crime control and detection (CC) items, which is designed to promote respect for human rights throughout the world. On the same day, BIS made another CC-related move, issuing a final rule regarding new controls on water cannon systems and related parts and components, with the preamble specifically describing riot and crowd control in Hong Kong.
Goods from China under heavy forced labour scrutiny
Arent Fox LLP- International Trade
- USA
- 25 September 2020
The Department of Homeland Security through US Customs and Border Protection (CBP) recently issued new withhold release orders (WROs) aimed at entities involved in the import, downstream manufacturing or sale of certain apparel, cotton, hair products and computer parts. As the WROs were backdated, they may adversely affect merchandise that is currently being shipped to the United States or which is already in CBP's custody.
BIS launches rulemaking process for foundational technologies and hints at potential areas of control
Arent Fox LLP- International Trade
- USA
- 18 September 2020
The Bureau of Industry and Security (BIS) has published the advance notice of proposed rulemaking (ANPRM) on foundational technologies, which seeks public comment on criteria for identifying and defining 'foundational technologies' essential to US national security. Although the ANPRM is vague, the potential for stronger control of items currently controlled as Export Administration Regulation 99 or for anti-terrorism, crime control, short supply or UN reasons should prompt comments.
Sanctions on Chinese apparel companies for forced labour hit retail supply chains
Arent Fox LLP- International Trade
- USA
- 18 September 2020
Fashion and luxury goods companies should be concerned about the recent sanctioning of Chinese companies in Xinjiang province by the US Departments of Treasury and Commerce and other US Customs and Border Protection (CBP) developments relating to importing products that contain fabric made with prison or forced labour. Notably, there is a risk that garments made from cotton produced by Xinjiang Production and Construction Corps could be subject to a CBP withhold release order.
CBP extends transition period for companies to comply with new Hong Kong marking requirements
Arent Fox LLP- International Trade
- USA
- 11 September 2020
US Customs and Border Protection recently issued new guidance providing an additional 45-day transition period for compliance with new marking requirements for goods produced in Hong Kong that are imported into the United States. This extends the transition period for companies to comply with the requirements from 25 September 2020 to 9 November 2020.
CBP gets tough on forced labour: turning supply chain risks into advantages
Arent Fox LLP- International Trade
- USA
- 11 September 2020
US Customs and Border Protection recently announced that it had collected $575,000 in penalties resulting from a civil enforcement action against importer Pure Circle USA for imports made with forced labour. This action indicates that CBP is following through with its mandate to prevent goods produced using forced labour from entering the stream of commerce and penalise importers when such goods do enter.
BIS expands Huawei Foreign Direct Product Rule to capture wide swath of COTS products
Arent Fox LLP- International Trade
- USA
- 04 September 2020
The Department of Commerce, Bureau of Industry and Security (BIS) recently issued a final rule adding additional Huawei non-US affiliates to the Entity List, confirming the expiration of the temporary general licence and amending the so-called 'Foreign Direct Product Rule'. BIS also issued another final rule clarifying that prohibitions on Entity List entities apply regardless of the role that the entities play in a transaction.
National security podcast: government zeroes in on China
Arent Fox LLP- International Trade
- USA
- 04 September 2020
Driven by national security concerns, over the past three years the government has taken a much more aggressive position on an array of technology issues involving China. These policy and regulatory changes range from significant new export controls and new supply chain screening of Chinese technology to efforts to jumpstart US research and development and 'reshore' manufacturing in strategic technology areas.
CBP issues guidance on new marking requirements for goods from Hong Kong
Arent Fox LLP- International Trade
- USA
- 28 August 2020
In July 2020 President Trump issued an executive order concerning certain import and export trade requirements between the United States and China. Subsequently, US Customs and Border Protection published a notice in the Federal Register providing an effective date for the new marking and the penalties for incorrect marking and released further guidance on the origin of goods from Hong Kong for Section 301 China tariff purposes through the issuance of FAQs.
Huawei rule part two: you 'use', you lose (government contracts)
Arent Fox LLP- International Trade
- USA
- 28 August 2020
The Federal Acquisition Regulation Council recently published a long-awaited interim rule implementing Section 889(a)(1)(B) of the National Defence Authorisation Act 2019. Essentially, the new rule prohibits government agencies from entering into, extending or renewing a contract with contractors if they use any equipment, system or service that uses certain Chinese telecoms equipment or services as a substantial or essential component of any system or as critical technology as part of any system.
Importers must act quickly to meet new marking requirements for goods from Hong Kong
Arent Fox LLP- International Trade
- USA
- 21 August 2020
As a result of the growing tensions between the United States and China, President Trump recently issued an executive order concerning certain import and export trade requirements between the two countries. Among these changes, it was mandated that goods produced in Hong Kong be marked with China as their country of origin. Because of the time needed to mark, pack and ship goods from Hong Kong to the United States, importers must act quickly to ensure compliance with this new requirement.
US administration takes on Chinese social media
Arent Fox LLP- International Trade
- USA
- 21 August 2020
President Trump recently signed an executive order (EO) banning 'transactions' – which have yet to be identified by the US Department of Commerce – relating to TikTok and its parent, ByteDance Ltd. The EO states that the spread of the Chinese mobile app continues to threaten the national security, foreign policy and economy of the United States. In addition to concerns relating to sensitive personal data, the EO points to concerns pertaining to influence operations.
Pentagon identifies 20 'Communist Chinese military companies'
Arent Fox LLP- International Trade
- USA
- 07 August 2020
The US Department of Defence recently published a list of 20 Chinese companies that have been identified as 'Communist Chinese military companies', complying with a two-decade-old mandate that Congress issued during the Clinton administration. The takeaway for companies, universities and individuals is that they should proceed with caution and carefully conduct due diligence when dealing with China.
United States farewells Hong Kong's separate customs territory status – what's the impact on importers?
Arent Fox LLP- International Trade
- USA
- 31 July 2020
In view of the recent action taken by President Trump in an executive order regarding Hong Kong's status, US importers should prepare for increased risk exposure in US-Hong Kong trade. Although Hong Kong technically continues to be treated as its own separate customs territory by multilateral agreements, the commitments undertaken by the United States with regard to the original 2047 timeline for Hong Kong's full reintegration into China are being rapidly accelerated.
FTC proposes new Made in the USA rule to expand enforcement authority
Arent Fox LLP- International Trade
- USA
- 31 July 2020
The Federal Trade Commission (FTC) has published a proposed rule for Made in the USA (MUSA) claims which would codify its current standard that unqualified MUSA claims for a product should have a reasonable basis for asserting that all or virtually all of the product is made in the United States and authorise it to assess monetary penalties on unsubstantiated claims. Controversially, the proposed rule would also extend the FTC's enforcement authority to labels, mail-order catalogues and online advertising.
Trade court limits president's power to impose tariffs for national security purposes
Arent Fox LLP- International Trade
- USA
- 24 July 2020
The US Court of International Trade recently granted judgment in favour of an importer of steel from Turkey, ruling that there are limits on the president's power to impose tariffs for national security purposes. The importer had argued that the president's proclamation of a 50% tariff on Turkish steel failed to follow the procedures required by the animating statute and violated the importer's constitutional rights.
French fashion and retail goods face 25% duties starting January 2021
Arent Fox LLP- International Trade
- USA
- 24 July 2020
Certain products from France, including leather handbags and certain beauty preparations and soaps, will soon become pricier. Following a disagreement over how to tax US tech companies in France, the US Trade Representative has imposed additional duties of 25% on French goods, effective 6 January 2021 – a cost that importers and retailers will have to absorb or pass on to their customers.
USMCA: sealed, delivered and in play
Arent Fox LLP- International Trade
- USA
- 17 July 2020
On 1 July 2020 the US-Mexico-Canada Agreement (USMCA) entered into force. These are still early days and much remains to be clarified by pending rulemaking. To help reduce the risk of making costly mistakes, this article provides a checklist of recommendations to guide readers through these first weeks and months of the USMCA.
United States moves to treat Hong Kong like China: what does this mean for US exporters?
Arent Fox LLP- International Trade
- USA
- 10 July 2020
The Department of Commerce and the Department of State recently announced that they were following through with changes to treat Hong Kong like China for exports of military and dual-use goods. The impetus for these measures was China's proposal to pass a controversial national security law affecting Hong Kong, which Beijing's top legislative body finally passed on 30 June 2020.
