- Overview of U.S. Sanctions and Office of Foreign Assets Control (OFAC)
Human nature is made of habits. Some are in the habit of getting things done at the last minute, some like to plan. When preparing goods for export it is best to plan. The reason is simple and practical: don’t delay shipment or discover at the last minute you can’t export because your items are controlled for export reasons. Therefore, it is best to prepare your goods for shipment. This includes classification of goods, of the items, you intend to export.
Holmes, too, and his team are beginning the process early. Fortunately for them, their inventory comprises few select items so it will not be too time consuming to complete the process. If, however, you’re a company that has a variety of parts and items in your inventory you intend to export then this process w
Last week the Office of Federal Contractor Compliance Programs announced the launch of a new Contractor Portal and the opening of its Affirmative Action Program Verification Interface. Beginning next year, covered contractors - contractors and subcontractors - must register on the portal and will have to submit a formal certification on the Portal. Based on the timeline shown, contractors have about seven months to prepare their certificates. Here are three milestone dates to know:
February 1, 2022 – expected opening date of the portal for registration
March 31, 2022 – certification features will be available
June 30, 2022 – all contractors and subcontractors must certify compliance with AAP requir
Holmes and his team have made progress and have identified a list of potential businesses in all the desired countries. That is success, except, Holmes and his team will need to follow another process to vet the businesses. Unlike other countries, U.S. has policies and regulations in place that forbid doing business with some countries, some entities, and some individuals. So, now that Holmes has a list of desired buyers, their team must comb through the businesses and list to get to know their customer and more important spot transaction red flags.
There are reasons for this. Holmes produces products that are export controlled – more on these on an upcoming article – that can be used for malicious pur
Today United States Government released the first anti-corruption strategy to address this malaise domestically and internationally. Anti - corruption was a core national security interest in President Biden's National Security Memorandum. Important in the strategy is the fight against money laundering, especially in real estate. Another crucial point of the strategy is the transnational and diplomatic focus. The U.S. Strategy has both domestic and international outreach.
Five organizing pillars are central to the strategy:
1. Modernizing, coordinating, and resourcing U.S. efforts to fight corruption.
2. Curb illicit finance. Therein lie the anti-money laundering efforts, business ownership transparency, cross - co
Growing globally is one way to expand your business. The rules of the road to global expansion apply equally to all businesses, large and small. The only difference is resources: small businesses often lack the resources to help guide them through this process. Here, I bring some key and important issues small businesses must know before they export as part of our education series of articles on this subject.
To do so we will follow Holmes who is a small business manufacturer of electronics, testing and measurement equipment. Holmes has decided to grow his business internationally. He has a few locations in mind and believes these will be good markets for his small business. He has decided to export to Germany, China, South Korea, Vietnam, Mexico, and Canada. Holmes has no contac
Yesterday, Bureau of Industry and Security issued a press release announcing an administrative settlement with SP industries (“SP”) related to allegations of four violations of Export Administration Regulations by exporting items to Huawei Technologies Co. Ltd (“Huawei”) and its two subsidiaries without a license.
Of note in the press release is the statement of Kevin J. Kurland, the Acting Assistant Secretary for Export Enforcement, BIS of U.S. Department of Commerce saying: “Huawei continues to present a threat to U.S. national security and foreign policy interests, and BIS Special Agents will aggressively investigate export violations where Huawei or any of its subsidiaries on the Entity List are a party to an exp
The short answer is that you must. The other short answer is that it can cost you. The long answer is that you will be subject to a government investigation, you may fight a civil litigation brought against you under the False Claims Act, it could be the case you may face also criminal charges. And, whether you will face all this it will depend on the clause you will have been found to have violated which was included in the solicitation and thereafter incorporated by reference in the contract you were awarded.
Still not convinced?! Recently, a company settled to pay $850,000 to the U.S. government for having sold items to the government from prohibited countries and items assembled in countries not in compliance with the Buy American Act (“BAA”) and/or the Trade Agre
ALBEX LAW, P.C. has begun operating under a new name and will be known as Dismondy & Associates, P.C., effective immediately.
The rebranding reflects the work we have done so far, our present, and the vision for the future. The new name also honors and pays tribute to the memory of my husband, Daniel, who has been a best friend, an advisor, and a tremendous support to me as I set out on my journey to start the business. It has been a family affair.
The name change allows us to better represent our business to our clients and potential clients. Along with the name change we have also designed this website to align with out vision and mission, thanks to the tremendous efforts of the design group at Jottful, a local woman owned company.
For more i
Last year changed many of us in various ways. As people, as business owners, we had to rethink our systems. The way we live and the way we do business. We are still adjusting or figuring it out. Some may be staying the same course as before, though doubtful, because we, as a people, have changed, therefore, whatever semblance of the before life taking place now is a faint reflection of the life that once was, for that life no longer is. May be our memory prolongs it, our desire to hold on, because we may not like the speed with which we had to rethink our new beginnings, adapt to the new, and continue a life we found ourselves living, not by design but because of the circumstances of our new reality.
This new reality has changed business as usual; we all know that. There is, howe
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In recent news the big news has also been Amazon’s bribery allegations in India in violation of Foreign Corrupt Practices Act (“FCPA”). Amazon has started an internal investigation. Crucial in this and in complaint against Amazon is the allegation that outside counsel paid bribes to Indian officials.
One may raise the question: lawyer bribed? Okay, we aren’t here to pass judgment on this and that. Everyone has one’s own system of values, integrity, and dignity. So, let us not get focused on the title of the culprit to be distracted by the message one has to learn from these developments. That if you are a business doing business internationally do your due diligence of your third parties engaged to help you break ground or start a business or develop
This year I decided to rock climb. Difficult sport. I’m not an athlete, never been. As you can imagine starting to rock climb at my age, one must prepare mentally and physically. There is no absence of emotional preparedness, therefore, I’m well equipped at least in one aspect. (Yes, that is a confidence booster).
Mentally I must prepare on two levels, I must tell myself I can do this, I have what it takes to do this. Also, I must quiet the voice in my head that says, “look at all these folks here, they are climbing the entire wall, and you, you can barely make it halfway without feeling weak.” Then, I reply internally “watch me”. I do have a competitive spirit. It’s a funny mental exercise to watch if you were in my head. My mental
When we, attorneys, read news like the title of this post, we wonder whether the act was intentional or whether it was ignorance of the law that brought about the charges. Some acts are intentional, and the consequences are more severe.
Here, the person involved committed acts besides illegal exports, resulting in several charges, each with its own sentencing and fines. It's worth mentioning that stories like this do not reach the daily press, however, they do interest the international trade community, not only as a cautionary tale, but also as a reminder to go back and check if we need to be concerns with any gaps in compliance within our own environment.
Let's explore the facts of this case that brought the situation he's in. The actions can be summed up as
I don't like sensations, however, some news in our world is sensational. For us who follow legal developments closely the above news comes from the Department of Justice. Recently, the President of a company and one employee, a sales representative, were arrested on charges of conspiracy to violate Export Controls Reform Act of 2018, conspiracy to commit wire fraud and bank fraud, and conspiracy to launder money.
As a matter of background, the two individuals on a first attempt had exported items without a license. The international trade community knows that dual use and military use items cannot be exported outside of United States without a license or license exception. The two individuals were not novices in trade, they had been engaged in trade for a while. They had shipped
We have yet to discover who will lead the country. While we all have a lot in our minds these days, as someone who closely follows international affairs, I thought to write a limited and brief prediction on the next chapter of U.S. – China relations and what U.S. companies must do while there is still time to help our country remain globally competitive.
First, what can we expect on U.S. – China relations under a Trump or Biden presidency. Should Trump win we will continue to see much of the same if not escalated tensions between the two nations. The past has paved the way for potential future regulatory changes and sanctions. For the international trade community of trade attorneys and compliance officers this means is to continue setting the alerts and staying on top of an
Can you pay a foreign official to obtain a contract award? Can you pay a foreign official to get a license for a product? How would you know that someone is a foreign official? Can a small business afford to pay over $2,000.000 dollars for violating FCPA, can a business afford to pay $19,000.000 for violating FCPA. Is one willing to spend time in prison for violating FCPA? Can a business afford to pay attorneys to deal with the investigation and defend against DOJ charges? I'm sure the answer is "No". Yet, some small businesses doing business internationally overlook that they must comply with the FCPA and sometimes intentionally take steps that go against the rules.
In my experience, most businesses like to do business on a fair playing field. They like to compete, that's the
The first part of this series focused specifically on record-keeping under Part 122 of the ITAR. As a small business manufacturer registered with DDTC it is your obligation to comply with the record-keeping requirement. For compliance purposes that provision of the ITAR applies whether one is doing business domestically or internationally.
If you're doing business internationally you also have to keep records on political contributions, fees and commissions to then fulfill the obligation of reporting these to the DDTC once they reach the threshold amount: political contributions in an aggregate amount of $5,000 or more, fees and commissions in an
While the industry is gearing up to prepare to comply with Section 889 (a)(1)(B) of the National Defense Authorization Act of the FY 2019, industry should also pay close attention to the DoD list of Communist Chinese Military entities. In addition to industry, universities and individuals need do the same.
First a brief reminder on Section 889(a)(1)(B) of the FY2019 of the NDAA: Part B prohibits the U.S. government from entering into a contract with "an entity that uses any equipment, system, or services that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system.”
Broadly, the ITAR (International Traffic in Arms Regulations) mandates that manufacturers and exporters register with DDTC if they are to manufacture, export, or temporarily import defense articles or furnish defense services. 22 C.F.R. §122.1 As a small business manufacturer of defense articles you may have already completed this step. It could be the case, that there may be other steps you have to fulfill to stay compliant with the ITAR. While registering is not the first step in the process, it is, however, the first step that triggers compliance with the ITAR. As you know a lot else is required, though, in our efforts to complete the big picture we may tend to forget some of the small steps that may be overlooked.
It is for this reason that I chose to bring Airbus as a ca
Part of the risk that businesses need to manage when doing business overseas is ensuring that its employees or people on the ground commit no crimes, among them are the crimes of bribery and corruption. Foreign Corrupt Practices Act's anti-bribery provisions prohibit any gifts made to foreign officials to obtain or retain business. Understanding who can be a foreign official is critical when doing business. For instance, doctors at a state - owned hospital are considered foreign officials for FCPA purposes. Most companies miss or ignore this and violate FCPA provisions.
In Novartis, although doctors were bribed, confusion about their status wasn't the trouble. To be clear Novartis is a mega company and this isn't the first time Novartis has violated the FCPA provisions. But i
Last year I wrote about the DOJ updated guidance (here), on June 2, 2020, unexpectedly, the DOJ made updates to its guidance. This update supersedes last year's guidance. The guidance is mainly designed to assist prosecutors "in making informed decisions as to whether, and to what extent, the corporation’s compliance program was effective at the time of the offense, and is effective at the time of a charging decision or resolution". As a community of compliance professionals, we also follow the guidance closely to support our clients build their compliance programs.
Usually DOJ evaluates the compliance programs "at the time of the offense and at the time of the ch
Governor Whitmer amended Executive Order No. 2020-70, issuing E.O. No. 2020 – 77, to allow another segment of economy to resume work beginning May 11, 2020: manufacturing work. To assist manufacturers with their decisions to reopen we have provided key points that manufacturers should know as they resume work.
The work will continue to be subject to “stringent precautionary measures.” The work may not begin unless the facility has been prepared to follow workplace safeguards.
All other rules of restriction about social distancing are in place, they are to be adhered to. In addition, “any in person work necessary to conduct minimum basic operation
As of today, Friday, April 3, 2020 small businesses can apply for government help as part of the $2 trillion economic stimulus plan approved by Congress and signed by President Trump last week, the CARE Act. Part of this Act is the Paycheck Protection Program, providing $349 billion in loans for small businesses. This program is administered by the Small Business Administration (the “SBA”) supported by the Treasury Department. The program tries to provide relief for small businesses to keep their employees and whether the storm. The loans can be for up to two months of the average payroll costs from the last year plus an additional 25% of that amount.
These loans are forgivable - though you must request forgiveness - as long as:
1. The loan is used to cover payroll
Pure Michigan Business Connect (PMBC) will provide $1 Million in grants to Michigan small businesses and non profits. Immediate funding up to $150,000 to qualified manufacturers. This is for manufactures looking to retool and produce critical health and human services supplies in response to the COVID – 19 says the report. Michigan small businesses will benefit – small business as defined by SBA size standard,
To qualify submit application at https://pmbc.connect.space/covid19/forms
What will be considered? Ability to execute project; need for financial assistance; timeliness; product need in market; economic impact. PMBC will also assist grantees by connecting them through the COVID – 19 Virtual Procurement an
First, we wish you and your families well. During these times of adjustment and adaptation I'm sure you have a lot to contemplate to figure out the logistics of managing your teams and work load.
We want to let you know that as a virtual law firm we are able to assist you without interruption. Should you need our assistance to set up at least one virtual component we're to help!
Wishing you well! We're in this together and we will get through it.
Federal contractors must perform on their contracts. Failure to do so could cause termination for default. This reflects badly on their performance score card. Because of the Coronavirus outbreak contractors need to look at their contract to see whether the language of the FAR clauses addressing excusable delays is included in their contracts.
Specifically, the following FAR clauses address excusable delays: FAR 52.249 - 8 ( fixed price contracts); FAR 52.249 - 14 (cost reimbursement, time and materials); FAR 52.212-4 (commercial contracts). These clauses, to summarize, excuse delays in performance where there are acts of God or public enemy, epidemics, quarantine restrictions, war, etc.
Two key concepts to remember: 1. these clauses give the contractor an opportunity t
Recently I had registered to attend a conference and as usual I had bought insurance for my flight and hotel bookings. When the conference organizers cancelled it due to current state of affairs created from the spread of the virus, it was easy for me to cancel the flight and the hotel. It was a contract I had with the parties and part of the contract was a cancellation clause and buying the insurance so I could get a full refund if an emergency occurs.
This was easy to do, 1,2, 3 click and done. But it’s not as easy for the business community that manages multiple contracts across many platforms where delays may be caused by suppliers affected by the outbreak of the Coronavirus. Here I’ll share three tips where you can manage the disruption. As you have heard or read China
As a business owner doing business with the federal or local and state government you follow three main steps in the life cycle of the contract: pre-award, performance of the contract post award, and payment for the work done.
Contract Fraud: In each step contractors seem to spend time thinking to find ways to fool the government. Pre - award contract fraud begins with the collusion. So, the contractors or want to be contractors will conspire with each other to create and present bids in such a manner that one of them would be awarded the contract. The price point in the contract becomes the genesis. Low price, or high price point, the contracting officer will see the offers presented and decide on the reasonableness of the price.
The outcome could lead to the contract
Join me tomorrow live on Facebook on my business page @albexlawpc for this 30 minute discussion on 3 aspects of contract fraud what should business owners know, how to avoid these aspects, and why this information is important.