Archive for the ‘Iran Sanctions’ Category

Feb

25

OFAC Nukes MOOCS

Posted by at 8:59 pm on February 25, 2014
Category: Cuba Sanctions • Economic Sanctions • Iran Sanctions • OFAC • Sudan • Syria

Formal Fridays via http://www.glassdoor.com/Photos/Coursera-Mountain-View-Office-Photos-EI_IE654749.0,8_IL.9,22_IC1147431.htm [Fair Use]I missed this earlier, but back at the end of January, Coursera, a provider of the euphoniously acronymed MOOCs (Massive Open Online Courses) said “No MOOCS for you” to residents of Cuba, Iran, Syria and Sudan who wanted to better themselves by taking online courses such as “Scandinavian Film and Television” or “Buddhism and Modern Psychology.” I certainly sleep better at night now knowing that the Cuban and Iranian threats are not being needlessly augmented by educating Cubans and Iranians on the subtle politics of Borgen or the psychological insights of the Four Noble Truths.

Because the online courses involve feedback, grading and the like, the concern is that these courses are an export of services, forbidden by the current sanctions on these countries, rather than the export of information, which is permitted under the Berman Amendment. Coursera is a little vague in explaining how it just found that out, saying that it “recently received information that has led to the understanding that the services offered on Coursera are not in compliance with the law as it stands” and that prior to that the law was “unclear.”

Coursera has given Syrian students a reprieve by saying that the State Department has told it that OFAC’s Syria General License 11A covers MOOCs for Syria. That license permits non-governmental organizations to export services to Syria in support of education. I’m not clear how Coursera qualifies as an NGO since it is not a non-profit but a for-profit corporation that seeks revenues and profits through its certification programs and sales of textbooks purchased through its affiliate relationship with Amazon. Nor am I quite clear how the State Department has acquired the ability to determine the scope of OFAC licenses.

The company claims that it is weeding out Cubans, Sudanese and Iranians based on IP addresses, apparently not having taken one of their own course on VPNs which would allow an Iranian wannabe student to appear, online at least, as a German or Italian or whatever. And since civil violations of OFAC rules do not require intent, Coursera is still liable if an Iranian is sitting in Iran but using a VPN to appear as if he or she were elsewhere.

This last point underlines a particular stupidity of applying a 19th century sanctions philosophy to a 21st century Internet where there are no borders. If an Iranian student is, in fact, sitting with his or her laptop in Germany, it would not be illegal for Coursera to provide its services to that student. It is only illegal when the student is in fact physically located in Iran. Now if you can identify a sensible policy which explains why it is more dangerous to teach an Iranian about Scandinavian TV while in Iran than it is in Germany, then you are much more clever than I am.

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Copyright © 2014 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)
Feb

14

OFAC Expands License for Personal Communications Items to Iran

Posted by at 1:24 pm on February 14, 2014
Category: Iran Sanctions

By Alireza Javaheri (http://www.panoramio.com/photo/50249960) [CC-BY-3.0 (http://creativecommons.org/licenses/by/3.0)], via Wikimedia Commons http://commons.wikimedia.org/wiki/File%3ATehran_-_Azadi_Tower.jpgLast week, the Office of Foreign Assets Control issued General License D-1 relating to provision of personal communications software, services and hardware to Iran.  This general license amends and replaces, as of February 7, 2014, General License D on the same subject. The following changes are made by the amendment

  • The amended license now permits exports of covered software, services and hardware by non-U.S. persons to Iran.
  • Additionally, hardware and software that is not subject to the EAR, because it is located outside the United States or otherwise, can be exported to Iran by U.S. and foreign persons.
  • The amendment also cleans up an embarrassing drafting error. General License D permit exports to “persons in Iran” rather than “to Iran,” meaning that it did not authorize persons traveling to Iran to carry covered hardware and software with them for personal use when traveling to Iran. General License D-1 makes clear that exports are authorized “to Iran” and that this covers travelers to Iran.
  • Exports of publicly available, no-cost services and software to the Iranian Government are now authorized.
  • A footnote makes clear that payments can involve indirect dealings with Iranian financial institutions blocked only under Executive Order 13599 (as opposed to Iranian banks like Bank Saderat and Bank Melli that are sanctioned under terrorism and WMD sanctions).

The FAQs on General License D-1 provide some insight into why this General License, rather unusually, permits dealings with the Government of Iran. They note that the authorization includes the Government of Iran “to further ensure that the sanctions on Iran do not have an unintended chilling effect” on companies seeking to make available publicly available, no-cost personal communications tools to persons in Iran. What this means, I think, is that when no-cost software or services are at issue, it is impossible for the provider to tell whether the recipient is an Iranian government official or not. This exception is limited to no-cost software and services presumably because when payment is required the provider will at least have a name of the supposed end-user of the software and services. Even then, it’s not clear how a company providing fee-based personal communications software to, say, Edward Casaubon in Tehran can tell whether Mr. Casaubon is an Iranian government official or simply a tiresome and frustrated author bearing an uncanny resemblance to John Locke.

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Copyright © 2014 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)
Feb

5

BIS Takes the Gloves Off

Posted by at 10:41 pm on February 5, 2014
Category: BIS • Iran Sanctions

Nitrotough Gloves http://www.marigoldindustrial.com/upload/img/nitrotoughN230B_web_situation_205x205.jpg [Fair Use]New Jersey based Ansell, maker of, among other things, protective gloves and protective, er, intimate apparel, was fined $190,000 in connection with the shipment of $73,700 of protective gloves to Iran. A French company affiliated with Ansell was also fined $190,000 in connection with these shipments.

The most interesting part of this case is the evasion charge under § 764.2(h) that BIS tacked on. Basically BIS charged that evasion occurred because the company transshipped the gloves through the UAE. Of course, most cases involving shipping to embargoed countries involve transhipment through a third country — usually the UAE — and yet BIS does not normally charge evasion in those cases, as it did not in this case. The charging documents here contain an extensive description of communications among the employees involved discussing the need to use a “middle company” in a third country to get around the embargo, so this may have been the motivating factor, although such discussions more normally used as a basis for adding an “acting with knowledge” charge under § 764.2(e)

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Copyright © 2014 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)
Jan

29

OFAC Likely Meets Tough Sell on Iran Sanctions Road Show to the Middle East

Posted by at 6:14 pm on January 29, 2014
Category: Economic Sanctions • Iran Sanctions • OFAC • Sanctions

By Jean-Pierre Bazard Jpbazard (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html) or CC-BY-SA-3.0-2.5-2.0-1.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons http://commons.wikimedia.org/wiki/File%3ALe_navire_cargo_%E2%80%98%E2%80%99Iran_Sadr%E2%80%98%E2%80%99_(6).jpg

The Treasury Department announced on Monday that Under Secretary David Cohen is traveling to Turkey and the UAE this week to discuss the implementation of the U.S. sanctions relief under the Iranian nuclear pact.  As important as the trip itself, the message to be delivered, according to the Treasury Department, will include a focus on “the limited and temporary sanctions relief provided under the [pact] and continued enforcement of existing international economic sanctions against Iran.”

Both Turkey and the UAE are critical to Iran’s foreign trade.  Turkey is Iran’s third-largest export and import partner, and Iran imports more from the UAE than anywhere else, accounting for approximately a third of Iran’s total imports.  Almost six years ago, we reported on Iran’s reliance on trade with the UAE and, respectively, the UAE’s apparent complicity to trade with Iran in ways that would be in violation of U.S. law.  In fact, Sheikh Mohammed Bin Rashid al-Maktoum, crown prince of Dubai and prime minister of the UAE, told the BBC earlier this month, that international sanctions against Iran should be lifted.  He added that “Iran is our neighbor and we don’t want any problem” and, if international sanctions are lifted, “everybody will benefit.”  Not exactly on point with U.S. sanctions policy.

As the Treasury Department appropriately describes, the U.S. sanctions relief under the nuclear pact is “limited” and is rather more of a U.S. pledge that sanctions will not be imposed against non-U.S. persons engaging in certain activities vis-à-vis Iran.  The emphasis to Turkey and the UAE, therefore, must be that U.S. sanctions are, in effect, at status quo in order to stem off any impression in the Middle East that U.S. sanctions against Iran are softening.

The challenge remains as it always has been: getting Turkish, UAE and other Middle Eastern buy-in to U.S. sanctions policy against Iran.  While Under Secretary Cohen may present some carrots on his trip, the stick to wield was announced along with his trip in highlighting “continued enforcement of existing international sanctions.”  The message, of course, would be that U.S. sanctions enforcement of Iran-related activities taking place in Turkey and the UAE will be bad for business in both countries.

Our advice to exporters remains the same as it was almost six years ago: know your customers especially well in Turkey and the UAE to ensure as best as possible that your business does not involve dealings with Iran.

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Copyright © 2014 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)
Jan

23

We Get Mail

Posted by at 12:54 pm on January 23, 2014
Category: Iran Sanctions

Somebody was reading Export Law Blog but was so busy looking for an email address to spam that they forgot to, you know, read the blog and see that I might have some difficulty in using her services to ship things through the port of Bandar Abbas in Iran.  Or perhaps she just has a very wry sense of humor:

And thank you, “Ms. Pari,” for the kind offer of your services. I’m glad you were glad to take the opportunity to contact me. So sorry it didn’t work out.

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Copyright © 2014 Clif Burns. All Rights Reserved.
(No republication, syndication or use permitted without my consent.)

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