Where Industry and Security Intersect
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BXA will review its standard license conditions, revise as appropriate, and communicate them to the other licensing agencies. The Office of Chief Counsel will review standard conditions to assess enforceability.
BXA will organize license conditions according to who is bound by them. Certain conditions may apply to the exporter, while other conditions may apply only to the consignee, and still other conditions to the end-user. BXA will specify explicitly in the license to whom conditions apply.
Exporters are currently required to convey licensing conditions to their customers by regulation and direction. BXA will place a rider on each export license stating that the exporter is required to convey to consignee(s), and end-users, freight forwarders and banks as appropriate, all conditions that affect them. BXA will also revise its regulations as necessary to ensure that they make this exporter obligation clear.
BXA will amend the regulations to require that all such parties to the transaction acknowledge in writing to the exporter the receipt of the conditions conveyed by the exporter. Exporters will be required to retain such acknowledgments consistent with their other record keeping obligations and to report to BXA if they fail to receive them. This will require OMB approval since it will increase the paperwork burden on the exporter.
For sensitive exports identified by licensing or enforcement officers or other agencies, Export Administration (EA) will contact the exporter after the issuance of the license but prior to actual shipment to stress the importance of adhering to all licensing conditions and being vigilant during the course of the export to ensure that the equipment or technology goes to the proper end-user, and that it is appropriately used. This contact may be in writing, by telephone or in person.
BXA uses a computer tickler system to identify conditions that require follow-up reporting. Delinquent companies will be contacted by phone and in writing within 30 days after a report's due date to remind them of their obligations. BXA will document all attempts to obtain required information. Failure to respond to BXA's written request will generally result in suspension of the license and referral to Export Enforcement (EE) for enforcement action.
For defined transactions of concern, BXA will include a license condition requiring access to the end-users' and intermediaries' facilities by U.S. government officials to ensure that the conditions imposed are being implemented.
BXA will fund, staff, and routinely audit its recordkeeping system to ensure strict compliance with its policy and all applicable statutes.
Specifically, BXA will ensure that it keeps records pertaining to commodity classifications, license determinations, license conditions, communications with license applicants and other parties, and investigations.
BXA will redesign its computer data system (ECASS) to ensure that conditions can be entered more easily and comprehensively.
BXA will continue its system of keeping enforcement agencies notified of licensing actions. BXA's EE has on-line access to all pending, approved, denied, and returned without action (RWA) licenses. U.S. Customs receives a daily data transfer of all completed licensing actions. EE maintains the ECASS screening and flag system to ensure that all cases are reviewed in concert with existing enforcement concerns and cannot be approved without EE's concurrence.
EE, with input from EA, will identify more appropriate candidates for PLCs and PSVs that focus on license conditions. Enforcement's Office of Enforcement Analysis will set PLC and PSV priorities and manage the process with our embassies consistent with its Performance Plan.
EA and EE will identify more candidates for PSVs and identify product categories and end-users warranting more frequent visits. Enforcement's Office of Enforcement Analysis will initiate the visit requests, and the Office of Export Enforcement will conduct more PSVs through the Foreign Commercial Service's officers or its own agents' Safeguards Verification Trips and manage the PSVs consistent with its Performance Plan.
BXA will conduct an annual analysis of one commonly used license exception (LE) to determine its ease of use, adherence to conditions, affect on legitimate trade, potential opportunities for abuse, and recommend corrective action and modification of LE terms, as needed. While there are thirteen different LEs, BXA will focus on the six that are based on destination or value (CTP-Computers, GBS-Group B Shipments, CIV -Civil End-users, TMP-Temporary Exports, LVS-Limited Values Shipments, and KMI-Key Management Infrastructure).
BXA will conduct thorough systems reviews of all SCL holders at least once every two years. BXA also will conduct reviews on all SCL consignees at least once during the validity period of the license. EA will make the results of systems reviews available to EE upon request. Any evidence of violations of the Export Administration Regulations (EAR) will be referred immediately to EE.
BXA will intensify its identification of exporters of sensitive items to countries of concern and identify those exporters' use of license exceptions. It will contact exporters and review documents justifying the application of the license exception or visit the company to verify the correct use of license exceptions.
Conduct periodic reviews of select companies' internal compliance plans/export management systems, including procedures for ensuring license condition compliance
BXA will identify companies that sell large volumes of controlled products to destinations of concern and conduct reviews of their internal control and export management procedures, prepare a report of findings and make appropriate recommendations.
If evidence of violations of the EAR is discovered during the course of the review, it will be forwarded to EE for action.
BXA will work with the intelligence community for better information exchange, especially on potential parties of concern.
EE will enhance outreach visits to selected exporters in high concern categories. These visits, generally conducted in person, will focus on how the exporter has complied with license conditions.
BXA will emphasize the importance of complying with license conditions in seminars and other outreach activities.
BXA will establish specialized training opportunities for freight forwarders, trading companies, and distributors.
- Imposition of conditions
- Control of reexports/retransfers
- Sharing of information, especially with respect to denials
- Obtaining end-use assurances
- Enforcement cooperation
- Sharing of investigative information
- Sharing of intelligence information
- Export Management Systems/Internal Control Programs
A major part of this effort will be the development of case studies and presentations for our closest trading partners on our export licensing and enforcement concerns in order to enlist their cooperation in implementing similar policies and practices.
In April of 2002 the Bureau of Export Administration (BXA) changed its name to the Bureau of Industry and Security(BIS). For historical purposes we have not changed the references to BXA in the legacy documents found in the Archived Press and Public Information.