Alexander Lukashenko

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Sometimes even somebody as distasteful Belarus’s dictator Alexander Lukashenko may have a point. Reacting to news that the U.S. may be considering further sanctions against Belarus, Belarus’s ambassador to the United States, Mikhail Khvostov, held a press conference to denounce the U.S. sanctions as illegal. The further sanctions against Belarus will likely target other state-owned companies in the same fashion that sanctions were imposed earlier this year on Belarus’s state-controlled oil-processing and chemicals company, Belneftekhim.

Khvostov pointed to the Memorandum on Security Assurances signed by the United States and Belarus in 1994. The U.S. entered into this Memorandum in exchange for Belarus agreeing to accede to the Nuclear Non-Proliferation Treaty. The relevant provision is this:

The United States of America, the Russian Federation, and the United Kingdom of Great Britain and Northern Ireland, reaffirm their commitment to [Belarus], in accordance with the principles of the CSCE Final Act, to refrain from economic coercion designed to subordinate to their own interest the exercise by the Republic of Belarus of the rights inherent in its sovereignty and thus to secure advantages of any kind.

According to Khvostov, the imposition of economic sanctions on Belarus notwithstanding this provision “shows that at any time the Bush administration can roll back the U.S. security assurances given to a legally binding instrument.” Not surprisingly, David Kramer, a State Department spokesman, countered that “We consider our actions to be wholly consistent with our political commitments and our obligations.”

It’s hard, however, to square the sanctions with the Memorandum unless one accepts one of two possible, but untenable, arguments. First, it might be argued that the sanctions are aimed at Lukashenko, members of his regime, and one state-owned company and not at Belarus itself. But the Memorandum prevents economic coercion broadly without making an exception for economic coercion targeting regime members and state-owned companies rather than the entire country. Second, it might be argued that the anti-democratic activities of Lukashenko which serve as the basis of the sanctions are not rights “inherent in sovereignty,” but this argument seems strained as well since sovereignty means, in the broadest sense, the right for a country to do what it wants, including things that are not necessarily democratic.

The Directorate of Defense Trade Controls (“DDTC”) issued today a final rule amending section 127.12 of the International Traffic in Arms Regulations (“ITAR”) which governs voluntary disclosures of violations of the ITAR by exporters of defense articles and defense services. Four significant revisions were made.

The new rules require additional specification of details and identifying information in a voluntary disclosure. Second, the new rules state that the voluntary disclosure must link new compliance initiatives in the exporter’s compliance program to the specific violations uncovered. Third, the DDTC may require, in the case of a “systematic pattern of violations,” a signature of “senior officer” on the voluntary disclosure

By far the most significant change effected by the new rule is a time limit between the initial and final disclosures. Under the new rule, the exporter who makes a preliminary disclosure must now file its final disclosure with DDTC within 60 days of the preliminary disclosure. Prior to this change, there was no time limit for the final disclosure, although DDTC staff encouraged the final disclosure to be made reasonably promptly. The new rule provides that the exporter may request an extension of the 60-day period if additional time is needed, although DDTC is under no obligation to grant the extension. Failure to file the final disclosure within the requisite time period may be used as DDTC as a reason to disregard the voluntary disclosure as a mitigating factor in assessing the penalty.

Of course, more than a few eyebrows have been raised in the export community that the notoriously slow agency should be imposing stricter “hurry up an wait” deadlines on exporters. Voluntary disclosures can take more than a year before the agency responds. Amendments to technical assistance agreements can also take a year or more, and commodity jurisdiction requests can fall into a black hole and remain unadjudicated for years. Worse certain agency employees have suggested that if Congress imposes time limits on DDTC for the processing of export licenses and other agency actions, the agency will simply respond by bouncing export license applications for minor technicalities. In view of this, one would hope that DDTC won’t be stingy in granting exporter requests for additional time to complete their internal investigations of voluntary disclosures that have been preliminarily disclosed.

In an earlier post, we noted that License Exceptions TMP and BAG’s “tools of the trade” exception might allow temporary export of laptops and the software on it, but that this exception did not cover technical data. Today the Bureau of Industry and Security (“BIS”) amended its rules to permit the export of technology — which would include technical data on dual-use items — under the TMP and BAG license exceptions.

There are several significant limitations on the use of these license exceptions for technical data. First, the license exception is only available to U.S. persons (i.e. citizens and permanent residents) or non-U.S. persons otherwise authorized to receive the technical data or technology. Second, technology exported pursuant to these exceptions may not be thereafter disclosed to anyone who is also not a U.S. person or specifically authorized to receive the data. Third, if the technical data exported under these exceptions is in a form that could facilitate a subsequent disclosure it must be returned to the United States or destroyed within 12 months from the export pursuant to the exception. Finally, adequate security precautions must be taken to prevent unauthorized disclosure of the technical data once it has been exported pursuant to the exception.