Volkswagen said Tuesday that  U.S. Customs had detained several thousand Bentley, Porsche and Audi vehicles at ports because the cars contained a part made by a Chinese supplier on a sanctions list for using forced labor in Xinjiang. The automaker describes the part's origin as a "sub-supplier," meaning a supplier to one of its suppliers—an entity far down the supply chain. Last year VW committed to conducting a supply chain audit for exposure to modern slavery.

Rep. Mike Gallagher, the most strident anti-communist to come out of Wisconsin's Fox River Valley since Sen. Joseph McCarthy, has had enough of the House of Representatives.    Mr. Gallagher told the Milwaukee Journal Sentinel he will leave Congress at the end of his current term to enter the private sector and spend more time with his young family.  

Treasury’s Office of Foreign Assets Control (OFAC) has taken its second price cap enforcement action of 2024, imposing sanctions on four entities and identifying one vessel as blocked property. OFAC is also issuing two new determinations that implement G7 commitments to ban the importation of Russian diamonds.

The Commerce Department published a notice of proposed rulemaking (NPRM) for establishing new requirements for Infrastructure as a Service providers (IaaS or “cloud infrastructure providers”). The proposed rule introduces potential regulations that require U.S. cloud infrastructure providers and their foreign resellers to implement and maintain Customer Identification Programs (CIPs), which would include the collection of “Know Your Customer” (KYC) information.

Six U.S. Departments published a Supplemental Advisory, reminding businesses and individuals of the compliance and reputational risks associated with trading with the military regime in Rangoon.   While North American companies continue to engage in Burmese extractive industries, the growing ring of sanctions means firms in the Rare Earths, Timber and Precious Metals trade run an increasing risk of negative legal, financial, or reputational consequences.

The Commerce Department’s Bureau of Industry and Security (BIS) has expanded the scope of the EAR’s Russian and Belarusian Industry Sector Sanctions by adding 95 6-digit Harmonized Tariff Schedule (HTS) codes to the list of items requiring a license for export, reexport, or transfer (in-country) to Russia or Belarus. The expanded list of items includes certain chemicals, lubricants, and metals, and it covers the entirety of Chapter 88 of the HTS (aircraft, spacecraft, and parts thereof).

The facilitator of the World Trade Organization's dispute settlement reform, Marco Tulio Molina Tejeda, circulated the fourth draft of the confidential ministerial decision, our correspondent writes. This draft remains silent on the appeal/review mechanism and the restoration of the Appellate Body. It introduces terms like “adjudicators,” absent in the current dispute settlement understanding, according to sources.

Commerce’s Bureau of Industry and Security (BIS) is conducting a comprehensive assessment of the use of mature-node semiconductor devices (legacy chips) in the supply chains that support—directly or indirectly—U.S. national security and critical infrastructure.

Assistant Secretary for Export Enforcement Matt Axelrod announced enhancements and expansions of the Bureau's Voluntary Self-Disclosure program, including simplified reporting, e-mail submittals and expedited handling of corrective action for unlawfully exported items. In a speech January 16 at NYU School of Law’s Program on Corporate Compliance and Enforcement Mr. Alelrod described the changes, along with an engaging history of the jukebox, details of which can be found in the complete speech.  

WTO members negotiating the accession of Comoros and Timor-Leste on 9 and 11 January, respectively, agreed by consensus, ad referendum, on the terms of the countries' WTO membership, paving the way for the least-developed countries (LDC) to join the organization. With the conclusion of the Working Party’s mandate, the accession package for both states will be submitted to ministers for a formal decision at the WTO’s 13th Ministerial Conference (MC13) in Abu Dhabi on 26-29 February.

SAP SE (SAP), a publicly traded global software company based in Germany, will pay over $220 million to resolve investigations by the U.S. Justice Department and the Securities and Exchange Commission (SEC) into violations of the Foreign Corrupt Practices Act (FCPA). According to the SEC complaint, from at least December 2014 through December 2018,  SAP employed third-party intermediaries and consultants in various schemes to make improper payments to government officials in order to obtain and retain business in South Africa, Greater Africa (Malawi, Kenya, Tanzania, and Ghana), and Indonesia. Readers may recall SAP’s prior history, which include a non-prosecution agreement from 2021 with the Justice Department’s National Security Division, as well as administrative agreements with the Departments of Commerce and the Treasury relating to Iran-related export law violations, and a resolution in 2016 with the SEC concerning alleged FCPA violations in Panama.

ASML, a Dutch semiconductor producer, had its license to ship two types of machines that make semiconductors partially revoked. This comes after ASML canceled some of its shipments ahead of tightening Dutch restrictions on exports. "China opposes the US’s overstretching the national security concept and using all sorts of pretexts to coerce other countries into joining its technological blockade against China," said Foreign Ministry Spokesperson Wang Wenbin.  

The Export-Import Bank of the U.S.  Board of Directors approved a $90 million guarantee under EXIM’s Supply Chain Finance Guarantee Program to Dutch Financier ING Capital to finance U.S. Natural Gas processor Freeport LNG Marketing. In 2020 Exim approved a deal with Freeport LNG, "with the first-ever use of a funder guarantee structure" for  $50 million.  That deal was a "tripartite agreement"  between EXIM, Private Export Funding Corporation (PEFCO) , and the scandal-plagued, now insolvent Greensill Capital. In June 2022 a blast attributed to safety failures caused approximately $275 million in damages and took the plant offline for 18 months.

The Commerce Department's October 27 "pause" in the issuance of new export licenses involving firearms under its jurisdiction is expected to end this month, and industry and its friends in Congress are girding for battle. The Protect American Gun Exporter Act introduced by Sen. Mike Lee (R-UT) seeks to forbid the Secretary from similar actions in the future and bar "unilateral' policy changes, while a leaked Commerce document proposes quite a few. In a  draft Federal Register Notice obtained by the website "The Reload" marked "predecisional"  Commerce proposes the addition of two new ECCNs, enhanced documentation requirements and other changes to improve traceability and control of the civilian arms trade.

The planned acquisition by Nippon Steel of what used to be America's preeminent steelmaker has stirred up a hornet's nest of jingoism and grandstanding in Washington and the Rust Belt, promising for a contentious review by the Committee on Foreign Investment in the US (CFIUS). "President Biden welcomes foreign investment that creates new US manufacturing jobs,"  National Economic Council Director Lael Brainard said.  “However, he also believes the purchase of this iconic American-owned company by a foreign entity – even one from a close ally – appears to deserve serious scrutiny in terms of its potential impact on national security and supply chain reliability,” 

The European Council adopted Monday a twelfth package of economic and individual restrictive measures in view of the continued Russian war of aggression against Ukraine.

Friday, the President signed a new Russia-related Executive Order advising financial institutions and payments processors that "Foreign financial institutions that conduct or facilitate significant transactions or provide any service involving Russia’s military-industrial base run the risk of being sanctioned by OFAC." Under these new authorities, OFAC can impose full blocking sanctions on, or prohibit or restrict the maintenance of correspondent accounts in the United States for, foreign financial institutions.

A bipartisan group of senators are calling on the Administration to put a halt to a surge in steel imports from Mexico. In a letter to National Security Advisor Jake Sullivan, the senators demanded the Administration set a clear deadline for Mexico to enforce the steel agreement reached with the United States in 2019. That agreement set quotas for Mexican steel and aluminum in place of the global Section 232 tariffs imposed by the Trump Administration.

In a wide ranging conversation at Georgetown University, Under Secretary of Commerce for Industry and Security Alan Estevez shared his perspective on the evolution of export controls and the road ahead. "I believe now that we are at sort of a foundational inflection point as to the role and purpose of export controls," Estevez said. " Commerce is in the middle of national security in a number of spheres these days.

"We do it from two perspectives. We do it from offense and we do it from defense. Offense is things like Chips Act. So how are we going to build chip production in the United States, where we have assured supply? Semiconductors are the foundation of a lot of what goes on in our economy. "The core of the defense structure is our export controls. Protecting the technology that our adversaries could use against us, should it ever come to any kind of kinetic action...

After a year of limited productivity, Congress has decided to get some work done in the last working week of the year. The House Foreign Affairs Committee Chairman held a markup session to consider various measures regarding export controls, restricting the flow of foreign nations’ support to the Taliban, and strengthening sanctions against Hamas, Palestinian Islamic Jihad and other terrorist groups on Wednesday, December 13th.