The Export Control Reform Act of 2018 (ECRA) (50 U.S.C. 4801-4852) authorizes the Secretary of Commerce, in carrying out its provisions, to undertake activities outside the United States, including, but not limited to, conducting investigations; requiring and obtaining information from persons; and conducting pre-license checks and post-shipment verifications. BIS officials will act with due care in the jurisdiction of a foreign nation and, to the extent possible, consistent with the applicable host nation government's laws. For any action taken outside the United States, BIS officials will consult and coordinate with the appropriate U.S. Government agencies and act in a manner consistent with the United States' international commitments and international agreements to which the United States is a party.

(c) Prohibited from applying for a license. No person subject to a denial order based on a conviction for a violation of any statute specified at 50 U.S.C. 4819(e)(1)(B) may apply for any license for a period up to 10 years from the date of the conviction. The duration of the prohibition shall be included as a term of the denial order. See § 766.25 of the EAR.

(b) * * *

(2) Pre-license checks. BIS conducts pre-license checks in order to establish the identity and reliability of the recipient of the items subject to the EAR that require a license, as well as to substantiate representations made on the license application. The results of the pre-license check, including the U.S. government's inability to conduct the pre-license check due to the end user's or host government's actions, will be considered in determining the outcome of a license application. The time required to conduct a pre-license check is not included in license application processing time calculations according to this paragraph, if the pre-license check is:

(i) Conducted through government channels, and

(ii) The request for a pre-license check is made by the Secretary or by another agency within the following time frames:

(A) The pre-license check is requested within 5 days of the determination that it is necessary; and

(B) The analysis resulting from the pre-license check is completed and reported to licensing officials within 5 days.

(a) Scope. Unless limited by a condition set out in a license, the export, reexport, or transfer (in-country) authorized by a license is for the item(s), end-use(s), and parties described in the license application and any letters of explanation. The applicant must inform the other parties identified on the license, such as the ultimate consignees and end users, of the license's scope and of the specific conditions applicable to them. BIS grants licenses in reliance on representations the applicant made or submitted in connection with the license application, letters of explanation, and other documents submitted. Any license obtained in which a false or misleading representation was made, or a material fact was falsified or concealed on the license application, letters of explanation, or any document submitted in connection with the license application, shall be deemed void as of the date of issuance. See § 750.8(a) of the EAR, which provides that all licenses are subject to revocation, in whole or in part, without notice. See part 764 of the EAR for other sanctions that may result in the event a violation occurs. A BIS license authorizing the release of “technology” to an entity also authorizes the release of the same “technology” to the entity's foreign persons who are permanent and regular employees (and who are not proscribed persons) of the entity's facility or facilities authorized on the license, except to the extent a license condition limits or prohibits the release of the “technology” to foreign persons of specific countries or country groups.

(a) Actions to assure compliance with export laws and regulations. OEE officials and any other officials of the United States designated by OEE are authorized and directed to take appropriate action to enforce the authorities granted to the Secretary under the laws and regulations of the United States, including ECRA, 13 U.S.C. 305, 22 U.S.C. 401, 50 U.S.C. 1701 et seq., the EAR, and the Foreign Trade Regulations (FTR) (15 CFR part 30). This includes, but is not limited to, assuring that:

(1) Exports, reexports, and transfers (in-country) without a license issued by BIS are either outside the scope of the license requirements of the EAR or authorized by a license exception and comply with the terms of the license exception;

(2) Exports, reexports, transfers (in-country) purporting to be authorized by licenses issued by BIS are, in fact, so authorized and the transaction complies with the terms of the license;

(3) Accurate EEI filings have been made for exports as required by this part, the FTR, and other federal regulations; and

(4) The activities of U.S. persons, wherever located, which are subject to a license requirement pursuant to § 744.6 of the EAR, are authorized by and comply with the terms of a BIS license.

(b) Types of actions. In carrying out the authorities granted to, and exercised by, the Secretary pursuant to ECRA, 13 U.S.C. 305, 22 U.S.C. 401, 50 U.S.C. 1701 et seq., the EAR, the FTR, and other applicable laws and regulations of the United States, including the authority to control the export, reexport, and transfer (in-country) of items, in any form, subject to the jurisdiction of the United States, whether by U.S. or foreign persons; control the activities of U.S. persons, wherever located, as described in § 744.6 of the EAR; ensure compliance with export controls; monitor shipments and other means of transfer; conduct investigations; and issue orders, OEE officials and any other officials of the United States designated by OEE are authorized to take the types of enforcement actions described below.

(1) Inspection, search, and detention of items—(i) Purpose of inspection, search, and detention. All items subject to export laws and regulations administered or enforced by the Secretary that have been, are being, or are about to be exported, reexported, or transferred (in-country) are subject to inspection, search, and detention. The scope of inspection may include, but is not limited to, item identification; technical appraisal (analysis) or both; verifying the accuracy of the EEI filing, or if there is no EEI filing, the air waybill, bill of lading or other loading document covering the item about to be exported, reexported, or transferred (in-country); and verifying the value and quantity of such item.

(ii) Place of inspection, search, and detention. Inspection, search, and detention may take place at any location inside or outside of the United States, to include, but not limited to, the borders of the United States, all ports of exit, the premises of freight forwarders, bonded warehouses, foreign trade zones, and manufacturing, transportation, and storage facilities.

(iii) Technical identification. Where, in the judgment of the official making the inspection, the item cannot be properly identified, a sample may be taken for more detailed examination or for laboratory analysis.

(A) Obtaining samples. The sample will be obtained by the official making the inspection in accordance with the provisions for sampling imported merchandise. The size of the sample will be the minimum representative amount necessary for identification or analysis. This will depend on such factors as the physical condition of the material (whether solid, liquid, or gas) and the size and shape of the container.

(B) Notification. When a sample is taken, the exporter, reexporter, or transferor, or their agent(s), and the ultimate consignee will be notified by letter from an OEE official, documenting the port of export, reexport, or other place of inspection, date of sampling, BIS license number (if any) or other authorization, invoice number, quantity of sample taken, description of item, marks and packing case numbers, and manufacturer's number for the item. A copy of the letter will be placed in the container that had been opened by the inspecting official, and a copy will be retained by the inspecting official's office.

(C) Disposal of samples. Samples will be disposed of in accordance with the U.S. Customs and Border Protection procedure for imported commodities.

(2) Inspection and production of books, records, and other information. OEE officials are authorized to require any person subject to export laws and regulations administered or enforced by the Secretary, including, but not limited to, exporters, reexporters, transferors, or their agent(s), and owners and operators of carriers or their agents, as well as intermediate consignees, ultimate consignees, and end users, and their agent(s) to produce for inspection and copying any books, records and other information, including, but not limited to, invoices, orders, letters of credit, inspection reports, technical documentation, packing lists, shipping documents and instructions, and correspondence.

(3) Questioning of individuals. OEE officials are authorized to question any person, including, but not limited to, the owner or operator of a carrier and the carrier's agent(s), as well as the exporter, reexporter, transferor (in-country), or their agent(s).

(4) Prohibiting lading. OEE officials may prevent the lading of items on a conveyance.

(5) Inspection, search, and detention of conveyance. OEE officials are authorized to inspect, search, and detain any conveyance at any time to determine whether items have been, are being, or are about to be exported, reexported, or transferred (in-country). Inspection, search, and detention of a conveyance may take place at any location inside or outside of the United States, to include, but not limited to, the borders of the United States, all ports of exit, the premises of freight forwarders, bonded warehouses, foreign trade zones, and manufacturing, transportation, and storage facilities.

(6) Seizure of property. OEE officials are authorized to seize any property, tangible or intangible, when there is probable cause to believe that such property is subject to administrative forfeiture (nonjudicial civil forfeiture or summary forfeiture), civil judicial forfeiture, or criminal forfeiture. Seizures of property subject to forfeiture may take place at any location inside or outside of the United States, to include, but not limited to, the borders of the United States, all ports of exit, the premises of freight forwarders, bonded warehouses, foreign trade zones, and manufacturing, transportation, and storage facilities.

(7) Administrative forfeiture authority. OEE is authorized to initiate administrative forfeiture (nonjudicial civil forfeiture or summary forfeiture) proceedings and forfeit property in accordance with the procedures set forth in 18 U.S.C. 981(d) and the Customs laws (19 U.S.C. 1602 et seq).

(8) Enforcement activity. (i) All BIS actions taken to implement, administer, and enforce the authorities granted to the Secretary shall be conducted pursuant to the U.S. Constitution and all applicable laws and regulations, including judicially recognized exceptions to the requirement for a search warrant under the Fourth Amendment, for example, consent of the person to be searched, exigent circumstances, searches incident to a lawful arrest, and border searches.

(ii) BIS may enter into any such agreements (e.g., memoranda of understanding) with other Federal agencies as deemed necessary by BIS to execute the authorities set forth in this part in a lawful and orderly manner.

(iii) BIS shall issue additional guidance as necessary to ensure the lawful and orderly execution of the Secretary's authorities.

(iv) Nothing in this section is intended to limit or abridge BIS law enforcement officers from exercising their lawful authority in carrying out their official duties.

(a) Carrier. As used in this section, the term “carrier” includes a connecting or on-forwarding carrier, as well as the owner, charterer, agent, master, or any other person in possession, control, or charge of the vessel, aircraft, vehicle, or other kind of conveyance, whether such person is located in the United States or in a foreign country.

(b) Ordering return or unloading of shipment. In order to ensure compliance with export laws and regulations administered or enforced by the Secretary, OEE officials, or any other official of the United States designated by OEE, may, with respect to a particular export, reexport, or transfer (in-country), order any carrier to return or unload the shipment. For the purpose of this section, furnishing a copy of the order to any person included within the definition of carrier will be sufficient notice of the order to the carrier. The carrier must, as ordered:

(1) Unload the shipment and make it available to OEE officials for search and inspection; or

(2) Return the shipment to the United States or cause it to be returned; or

(3) Unload the shipment at a port of call and take steps to assure that it is placed in custody under bond or other guaranty not to enter the commerce of any foreign country without the prior approval of BIS.

(c) Requirements regarding shipment to be unloaded. The provisions of § 758.5(d) and (e) of this part, relating to reporting, notification to BIS, and the prohibition against unauthorized delivery or entry of the item into a foreign country shall apply also when items are unloaded at a port of call, as provided in paragraph (b)(3) of this section.

(d) Notification. Upon discovery by any person included within the term “carrier,” as defined in paragraph (a) of this section, that a violation of the export laws and regulations administered or enforced by the Secretary has occurred, is occurring, or is about to occur with respect to a shipment on board, or otherwise in the possession or control of the carrier, such person must immediately notify both:

(1) The Office of Export Enforcement at the following address: Room H-4508, U.S. Department of Commerce, 14th Street and Constitution Ave. NW, Washington, DC 20230, Telephone: (202) 482-1208, Facsimile: (202) 482-0964; and

(2) The person in actual possession or control of the shipment.

The provisions of this part apply only to exports, reexports, and transfers (in-country), as well as the activities of U.S. persons described in § 744.6 of the EAR, which are subject to the export laws and regulations administered or enforced by the Secretary. Nothing contained in this part shall relieve any person from complying with any other law of the United States or rules and regulations issued thereunder, including those governing EEI filings to AES, manifests, or any other applicable rules and regulations.

(a) Persons located in the United States. Persons located in the United States may be asked to produce books, records, and other information that are required to be kept by any provision of the EAR, or any license, order, or authorization issued thereunder and to make them available for inspection and copying by any authorized official of the BIS, or any other official of the United States designated by BIS, without any charge or expense to such official. OEE and the Office of Antiboycott Compliance encourage voluntary cooperation with such requests. When voluntary cooperation is not forthcoming, OEE and the Office of Antiboycott Compliance are authorized to issue subpoenas requiring persons to appear and testify, or to produce books, records, and other writings. In instances where a person does not comply with a subpoena, the Department of Commerce may petition a district court to have the subpoena enforced.

(b) Persons located outside of the United States. Persons located outside of the United States that are required to keep books, records, and other information by any provision of the EAR or by any license, order, or authorization issued thereunder shall produce all books, records, and other information required to be kept, or reproductions thereof, and make them available for inspection and copying upon request by an authorized official of BIS without any charge or expense to such official. BIS may designate any other official of the United States to exercise the authority of BIS under this subsection.

In this part, references to the EAR are references to 15 CFR chapter VII, subchapter C. This part specifies conduct that constitutes a violation of the ECRA and/or the EAR and the sanctions that may be imposed for such violations. Antiboycott violations are described in part 760 of the EAR, and the violations and sanctions specified in part 764 also apply to conduct relating to part 760, unless otherwise stated. This part describes administrative sanctions that may be imposed by BIS. This part also describes criminal sanctions that may be imposed by a United States court and other sanctions that are neither administrative nor criminal pursuant to sections 11A, B, and C of the Export Administration Act EAA and other statutes. Information is provided on how to report and disclose violations. Finally, this part identifies protective administrative measures that BIS may take in the exercise of its regulatory authority.

(a) Engaging in prohibited conduct. No person may engage in any transaction or take any other action prohibited by or contrary to, or refrain from engaging in any transaction or take any other action required by ECRA, the EAR, or any order, license or authorization issued thereunder.

(b) Causing, aiding, or abetting a violation. No person may cause or aid, abet, counsel, command, induce, procure, permit, or approve the doing of any act prohibited, or the omission of any act required, by ECRA, the EAR, or any order, license or authorization issued thereunder.

(c) Solicitation and attempt. No person may solicit or attempt a violation of ECRA, the EAR, or any order, license, or authorization issued thereunder.

(d) Conspiracy. No person may conspire or act in concert with one or more persons in any manner or for any purpose to bring about or to do any act that constitutes a violation of ECRA, the EAR, or any order, license, or authorization issued thereunder.

(e) Acting with knowledge of a violation. No person may order, buy, remove, conceal, store, use, sell, loan, dispose of, transfer, transport, finance, forward, or otherwise service, in whole or in part, or conduct negotiations to facilitate such activities with respect to, any item that has been, is being, or is about to be exported, reexported, or transferred (in-country), or that is otherwise subject to the EAR, with knowledge that a violation of ECRA, 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.

(f) [Reserved]

(g) Misrepresentation and concealment of facts. (1) No person may make any false or misleading representation, statement, or certification, or falsify or conceal any material fact, either directly to BIS or an official of any other United States agency, or indirectly through any other person:

(i) In the course of an investigation or other action subject to the EAR; or

(ii) In connection with the preparation, submission, issuance, use, or maintenance of any “export control document” or any report filed or required to be filed pursuant to the EAR; or

(iii) For the purpose of or in connection with effecting an export, reexport, transfer (in-country) or other activity subject to the EAR.

(2) All representations, statements, and certifications made by any person are deemed to be continuing in effect. Every person who has made any representation, statement, or certification must notify BIS, and any other relevant agency, in writing, of any change of any material fact or intention from that previously represented, stated, or certified, immediately upon receipt of any information that would lead a reasonably prudent person to know that a change of material fact or intention has occurred or may occur in the future.

(h) Evasion. No person may engage in any transaction or take any other action with intent to evade the provisions of ECRA, the EAR, or any order, license or authorization issued thereunder.

(i) Failure to comply with reporting, recordkeeping requirements. No person may fail or refuse to comply with any reporting or recordkeeping requirement of ECRA, the EAR, or of any order, license, or authorization issued thereunder.

(j) License alteration. Except as specifically authorized in the EAR or in writing by BIS, no person may alter any license, authorization, export control document, or order issued under ECRA or the EAR.

(k) Acting contrary to the terms of a denial order. No person may take any action that is prohibited by a denial order or a temporary denial order issued by BIS to prevent imminent violations of ECRA, the EAR, or any order, license or authorization issued thereunder.

(a) Administrative. Violations of ECRA, the EAR, or any order, license or authorization issued thereunder are subject to the administrative sanctions described in this section and to any other liability, sanction, or penalty available under law. The protective administrative measures that are described in § 764.6 of this part are distinct from administrative sanctions.

(1) Civil monetary penalty. (i) A civil monetary penalty not to exceed the amount set forth in ECRA may be imposed for each violation, and in the event that any provision of the EAR is continued or revised by IEEPA or any other authority, the maximum monetary civil penalty for each violation shall be that provided by such other authority.

(ii) The payment of any civil penalty may be made a condition, for a period not exceeding two years after the imposition of such penalty, to the granting, restoration, or continuing validity of any export license, license exception, permission, or privilege granted or to be granted to the person upon whom such penalty is imposed.

(iii) The payment of any civil penalty may be deferred or suspended in whole or in part during any probation period that may be imposed. Such deferral or suspension shall not bar the collection of the penalty if the conditions of the deferral, suspension, or probation are not fulfilled.

(2) Denial of export privileges. An order may be issued that restricts the ability of the named persons to engage in exports, reexports, and transfers (in-country) involving items subject to the EAR, or that restricts access by named persons to items subject to the EAR. An order denying export privileges may be imposed either as a sanction for a violation of ECRA, the EAR, or any other statute set forth at 50 U.S.C. 4819(e)(1)(B); or as a protective administrative measure described in § 764.6(c) or (d) of this part. An order denying export privileges may suspend or revoke any or all outstanding licenses issued under the EAR to a person named in the denial order or in which such person has an interest; may deny or restrict exports, reexports, and transfers (in-country) by or to such person of any item subject to the EAR; and may restrict dealings in which that person may benefit from any export, reexport, or transfer (in-country) of such items. The standard terms of a denial order are set forth in supplement no. 1 to this part. A non-standard denial order, narrower in scope, may be issued. Authorization to engage in actions otherwise prohibited by a denial order may be given by the Office of Exporter Services, in consultation with the Office of Export Enforcement, upon a written request by a person named in the denial order or by a person seeking permission to deal with a named person. Submit such requests to: Bureau of Industry and Security, Office of Exporter Services, Room 2099b, U.S. Department of Commerce, 14th Street and Pennsylvania Ave. NW, Washington, DC 20230.

(3) Exclusion from practice. Any person acting as an attorney, accountant, consultant, freight forwarder, or in any other representative capacity for any license application or other matter before BIS may be excluded by order from any or all such activities before BIS.

(b) Criminal. Whoever willfully commits, willfully attempts to commit, or willfully conspires to commit, or aids and abets in the commission of, an unlawful act described in 50 U.S.C. 4819(a) shall be fined not more than $1,000,000; and in the case of the individual, shall be imprisoned for not more than 20 years, or both.

(c) Other sanctions. Conduct that violates ECRA, the EAR, or any order, license, or authorization issued thereunder, and other conduct specified in sections 11A, B, and C of the EAA may be subject to sanctions or other measures in addition to criminal and administrative sanctions under ECRA or the EAR. These include, but are not limited to, the following:

(1) Statutory sanctions. Statutorily-mandated sanctions may be imposed on account of specified conduct related to weapons proliferation. Such statutory sanctions are not civil or criminal penalties, but restrict imports and procurement (See section 11A of the EAA, Multilateral Export Control Violations, and section 11C of the EAA, Chemical and Biological Weapons Proliferation), or restrict export licenses (See section 11B of the EAA, Missile Proliferation Violations, and the Iran-Iraq Arms Non-Proliferation Act of 1992).

(2) Other sanctions and measures—(i) Seizure and forfeiture. Any property seized pursuant to export laws and regulations administered or enforced by the Secretary is subject to forfeiture. (50 U.S.C. 4819(d) and 4820(j); 22 U.S.C. 401; and 13 U.S.C. 305).

(ii) Actions by other agencies. (A) The Department of State may not issue licenses or approvals for the export or reexport of defense articles and defense services controlled under the Arms Export Control Act to persons convicted of criminal offenses specified at 22 U.S.C. 2778(g)(1)(A), or to persons denied export privileges by BIS or another agency; and may deny such licenses or approvals where the applicant is indicted for, or any party to the export is convicted of, those specified criminal offenses. (22 CFR 126.7(a) and 127.11(a)).

(B) The Department of Defense, among other agencies, may suspend the right of any person to contract with the United States Government based on export control violations. (Federal Acquisition Regulations at 48 CFR 9.407-2).

(a) General. The Director of the Office of Export Enforcement (OEE), in consultation with the Director of the Office of Exporter Services, may deny the export privileges of any person who has been convicted of a violation of any of the statutes set forth at 50 U.S.C. 4819(e)(1)(B), including any regulation, license, or order issued pursuant to such statutes.

(b) Procedure. Upon notification that a person has been convicted of a violation of one or more of the provisions specified in paragraph (a) of this section, the Director of OEE, in consultation with the Director of the Office of Exporter Services, will determine whether to deny such person export privileges, including but not limited to applying for, obtaining, or using any license, License Exception, or export control document; or participating in or benefitting in any way from any export or export-related transaction subject to the EAR. Before taking action to deny a person export privileges under this section, the Director of OEE will provide the person written notice of the proposed action and an opportunity to comment through a written submission, unless exceptional circumstances exist. In reviewing the response, the Director of OEE will consider any relevant or mitigating evidence why these privileges should not be denied. Upon final determination, the Director of OEE will notify by letter each person denied export privileges under this section.

(c) Criteria. In determining whether and for how long to deny U.S. export privileges to a person previously convicted of one or more of the statutes set forth in paragraph (a) of this section, the Director of OEE may take into consideration any relevant information, including, but not limited to, the seriousness of the offense involved in the criminal prosecution, the nature and duration of the criminal sanctions imposed, and whether the person has undertaken any corrective measures.

(h) Applicability to related person. The Director of OEE, in consultation with the Director of the Office of Exporter Services, may take action in accordance with § 766.23 of this part to make applicable to related persons an order that is being sought or that has been issued under this section.