International Trade Enforcement Roundup | February 2023

when transferring technical data, which can electronically cross borders even when information is simply being shared amongst employees of the same company. Similarly, companies must be aware of where their servers are located and how technical data can be encrypted to ensure that it is not inadvertently exported to a prohibited recipient or destination. Complying with a consent agreement imposes a huge financial commitment on a company. Even with the $10 million set aside for remedial measures pursuant to the agreement, the compliance burden for 3D Systems will likely be significant.

China-Related Designations (BIS Action)

On February 10, BIS announced it had added six Chinese entities to the EL following the transcontinental journey of a Chinese “spy balloon.” According to the Assistant Secretary of Commerce for Export Enforcement Matthew Axelrod, the action “demonstrates our concerted effort to identify and disrupt the PRC’s [People’s Republic of China] use of surveillance balloons, which have violated the airspace of the United States and more than forty other countries.”

The six entities are as follows:

Beijing Nanjiang Aerospace Technology Co., Ltd.

China Electronics Technology Group Corporation 48th Research Institute

Dongguan Lingkong Remote Sensing Technology Co., Ltd.

Eagles Men Aviation Science and Technology Group Co., Ltd.

Guangzhou Tian-Hai-Xiang Aviation Technology Co., Ltd.

Shanxi Eagles Men Avia tion Science and Technology Group Co., Ltd.

As a result of these designations, a license from BIS is required for any person to export or re-export an EAR- controlled item to these entities, including certain items produced outside the United States using U.S.-origin technology or equipment. Moreover, license applications for exports to these designated parties (as is generally the case with license applications for all parties on the EL) will be reviewed under a presumption of denial.

The BIS press release can be found here. The final rule can be found here.

Austria and Switzerland

Dotphins LLC Settles Charges of EAR Violations (BIS Action)

Those involved. Dotphins LLC, an e-commerce platform.

Charges and penalties. Two Violations of the EAR (various penalties described in full below).

What happened? In 2016, Dotphins LLC exported two red dot scopes, devices mounted to the top of a firearm to help the user aim, from the United States to Austria and Switzerland without a required license under the EAR. The scopes, with a total value of less than $200, are classified under ECCN 0A504 on the CCL and therefore require a license for export to Austria and Switzerland, even though each is a well-established U.S. trading partner.

The BIS Order settling the proposed charges can be found here.

4 International Trade Enforcement Roundup |

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