Creating an Effective Export Compliance - PowerPoint Presentation

Slide1

Creating an EffectiveExport Compliance Program and The BIS Help Availableif a Violation Occurs

Webinar

March 22, 2018

Bureau of Industry and

Security

U.S. Department of Commerce

Bryce Bewley

Senior Export Compliance Specialist

Bureau of Industry and Security

Department of CommerceSlide2

Elements of an Effective

Export Compliance ProgramSlide3

Management Commitment Is Top Down Slide4

Management Policy StatementDate From President or CEO

Statement of Management Commitment to Export ComplianceSlide5

https://www.bis.doc.gov/index.php/forms-documents/pdfs/1641-ecp/fileSlide6

Table of Contents and Audit Module Table of Contents Slide7

Risk AssessmentIdentify risks in the export processSlide8

Common Problems/RisksRelying on a single person to exportNo formal proceduresNo back-upsUnknown End-User or End-UseUnaware of diversion risks or common red flags

Violating Anti-boycott LawsDevelop Stop, Hold and Release proceduresSlide9

Ways to Mitigate Risk

Screen parties

Obtain End-Use statement if possible, if not, use contractual agreements as evidence of due diligence

Choose trusted and proven freight forwarders

Audit export facilitators periodicallySlide10

ScreeningEXPORT AUTHORIZATIONSlide11

ScreeningCritical action of Export Authorization – for any and all items subject to the EARBest done as orders comes in, and prior to export if any lapse in timeVendor software screening programs may be preferable for larger volumes

Commerce and other agencies have produced a Consolidated Screening List search tool Slide12

Consolidated Screening ListWhat is Included?Commerce – BIS 1) Denied Persons List

2) Entity List 3) Unverified List State - DDTC

4) Nonproliferation Sanctions List Part

561 List5) Debarred Parties

List

Treasury - Office of Foreign Assets Control

6) Specially Designated Nationals List

7) Foreign Sanctions Evaders

8) Sectoral Sanctions Identification (SSI)

9) Palestinian Legislative Council (PLC)

10) Non SDN Iranian Sanctions Act (NS-ISA) ListSlide13

Consolidated Screening Toolhttp://apps.export.gov/csl-search#/csl-search

Search Options

Search ResultsSlide14

ReportsPurchase OrdersFinancial

RecordsAccounting

Records

InvitationsTo Bid

Contracts

Correspondence

License

Exceptions

Memoranda

Bill of

Lading

Export

Licenses

Customer

Records

AES

Records

Destination

Control

Statement

EMCP

Manual

Visitor

Logs

Training

Logs

Airway

Bills

Consignee

Statement

Voluntary

Self

Disclosure

Product

Classification

List

Certificates

Screening

Records

Annual

Reports

Notes

Audits

Invoices

5 YEARS

Retention

Recordkeeping

- EAR Part 762Slide15

Create a System to Manage RecordsEvaluate, or determine, whether you’re going with electronic, paper, or a combinationEngage your company’s Information Technology (IT) team so they understand your export record needs and requirementsSection 762.6 of the EAR requires records to be kept for 5 years from the latest date of export,

re-export, or transshipment. For a list of items the EAR requires to be kept see: http://www.bis.doc.gov/index.php/forms-documents/doc view/1209-762Slide16

Reproducing Original Records

Section 762.5Complete, accurate, and legible

Regardless of storage method, must be capable of being reproduced onto paper.Must have all marks, information, and other characteristics of the original and be legible.Slide17

Recordkeeping for Other Agencies

15 CFR 30.66(c

)

22 CFR Part 122.5

19 CFR Part 163

31 CFR Part 501Slide18

Training

Provide job specific training

Communicate export responsibility

Hold employees accountableSlide19

19

Ways to Communicate

Your Compliance Message

Incentive Programs

Voice-mail

Bulletin

Boards

Company

Handbooks

Posters

Newsletters

Videos

Intranet

&

Internet

E-mailSlide20

Export Training ResourcesBIS Exporter PortalBIS Online Training RoomBIS SeminarsUS Census Bureau’s AES Compliance TrainingUS Census Bureau’s Export Training RoomSlide21

Auditing

To identify compliance deficiencies

To address potential areas of risk

To check for inconsistencies between procedures and practices

Should conduct both scheduled and random spot checks

Conducted by a qualified individual or teamSlide22

Handling Export Violations and Taking Corrective ActionsSenior Management Support Internal and External Reporting

Voluntary Self-DisclosuresSlide23

Internal and External Reporting

23

Employee

Discovery

Company

Investigation

Corrective Actions

Cease Concerned Activities

Submit VSD

Seek Outside Counsel, if neededSlide24

VSD Statistics for FY 2016 - 2017Point of Contact for VSD QuestionsOffice of Export Enforcement(202) 482-5036

OEE Actions On

Closed

VSDs

FY 2017

Total 420

FY 2016

Total 475

#

%

#

%

Warning Letter

337

80%

383

81%

No action or violation

74

18%

63

13%

Closed for Other Reasons

7

2%

23

5%

Issued Administrative Sanctions

2

<1%

6

1%Slide25

Voluntary Self-Disclosures (VSDs)Section 764.5

25

Submitted by

: A

company when there is knowledge of a possible export violation of the EAR, license, license condition, or order.

Fully disclose

:

Write a complete description including Who

, What, When, Where, How,

and Why

Mail to:

U.S

. Department of Commerce

Bureau of Industry and Security

Director, Office of Export Enforcement

1401 Constitution Ave., N.W.

Room H4514

Washington, D.C. 20230Slide26

CFR 15- Part 764.5f

Treatment of unlawfully exported items after voluntary self-disclosureSlide27

Carrot & Stick

Part 764.5f (f) Treatment of unlawfully exported items after voluntary self-disclosureAny person who has made a voluntary self-disclosure knows that a violation may have occurred. Therefore, at the time that a voluntary self-disclosure is made, the person making the disclosure may request permission from BIS to engage in the activities described in §764.2(e) of this part that would otherwise be prohibited. If the request is granted by the Office of Exporter Services in consultation with OEE, future activities with respect to those items that would otherwise violate §764.2(e) of this part will not constitute violations. However, even if permission is granted, the person making the voluntary self-disclosure is not absolved from liability for any violations disclosed nor relieved of the obligation to obtain any required reexport authorizations.

CFR 15 - Part 764.2(e) Acting with knowledge of a violationNo person may order, buy, remove, conceal, store, use, sell, loan, dispose of, transfer, transport, finance, forward, or otherwise service, in whole or in part, any item exported or to be exported from the United States, or that

is otherwise subject to the EAR, with knowledge that a violation of the EAA, the EAR, or any order, license or authorization issued thereunder, has occurred, is about to occur, or is intended to occur in connection with the item.Slide28

Creating & Maintaining the ECP

Provides detailed instructions for everyday use

Provides great

weight

in mitigation

for administrative penaltiesSlide29

Common TendenciesToo much policy not enough detailMissing Audits and ViolationsMissing contact person and infoBIS will review your ECP at no costSlide30

External Communication Network

30

If you determine external notification may be necessary:

Immediately cease activities of

concern

Advise employees to save all documents

Determine mitigating

factors

Determine if other violations may exist

Counsel experienced in export law can be

helpful

Centralize

communications

Disclose promptly

Tom Andrukonis

Bureau of Industry and Security

U.S. Department of Commerce

Thomas.Andrukonis@bis.doc.gov

SEND YOUR ECP REVIEWS AND 764.5F REQUESTS Slide31

We value your feedback

Please take a moment to complete our evaluation

Tell us what we could improve

AND what we did well!

*Check the webinar “Chat” box to easy access to the link!*

If

you don’t see the

Chat

box,

you can find the evaluation on your

browser

at

https://questionweb.com/59212/