CE CE Export Controls & Sanctions Compliance 3

Question 1

What is 'deemed export' under the EAR and why is it significant for U.S. companies employing foreign nationals?

Accepted Answer

The release of controlled technology to a foreign national in the U.S. is deemed an export to that person's home country and may require a BIS license

Answer

Goods displayed at a U.S. trade show are deemed exported to attending foreign buyers

Answer

Any product shipped overseas is deemed to include all related technical data

Answer

Training a foreign customer in a foreign country is deemed a domestic activity

Question 2

What is the purpose of the Specially Designated Nationals (SDN) List and which agency maintains it?

Accepted Answer

OFAC maintains the SDN List, which identifies individuals and entities whose assets are blocked and with whom U.S. persons are generally prohibited from transacting

Answer

BIS maintains the SDN List to track export violations by foreign companies

Answer

The State Department maintains the SDN List for visa denials

Answer

CBP maintains the SDN List to identify high-risk import shipments

Question 3

What civil penalty can OFAC impose on a U.S. company for a single willful violation of economic sanctions?

Accepted Answer

The greater of $1 million or twice the transaction value

Answer

A fixed penalty of $100,000 per violation

Answer

A mandatory 2-year export ban

Answer

A penalty equivalent to 10% of annual revenue

Question 4

What is an export compliance program (ECP) and what are its key components?

Accepted Answer

A company's documented system for ensuring compliance with export control laws, including management commitment, classification, screening, training, recordkeeping, and auditing

Answer

An insurance policy covering fines from export violations

Answer

A government certification program for low-risk exporters

Answer

A software tool that automatically files export declarations

Question 5

Under the EAR, how long must exporters retain export control records?

Accepted Answer

Five years from the date of the export, re-export, or other regulated transaction

Answer

Two years from the shipment date

Answer

Seven years from the end of the fiscal year in which the transaction occurred

Answer

Ten years for controlled items and three years for EAR99 items

Question 6

What is the 'catch-all' control under the EAR and when does it apply?

Accepted Answer

It applies when an exporter knows or has reason to know that an EAR99 item will be used in weapons of mass destruction (WMD) programs, requiring a license regardless of classification

Answer

It automatically subjects all goods to a license requirement during national emergencies

Answer

It requires licenses for all exports to countries on the OFAC sanctions list

Answer

It allows BIS to reclassify any item if it poses a national security risk