Category: Trade Security

Detaining American citizens in the Western Hemisphere for political purpose is not new. In 2009 a U.S. government contractor, Alan Gross, was detained in by Cuba on alleged espionage charges. Gross remains in prison to this day serving a fifteen year prison sentence. Cuba likely is using Gross case to secure political concessions from the United States.

For example, Cuba wants U.S. sanctions eased as well as securing the release of five Cuban spies serving time in federal prison on espionage charges.  At the time of his arrest, Gross’s lawyers, with the support of several Members of Congress, tried to negotiate Gross’s release as well as defend him in the Cuban legal system. The media frenzy this case first generated was exactly what the Cuban government needed at that time.

Is Hugo Chavez borrowing a page from his mentor in Havana? Time will tell. The political situation in Venezuela is quite tenuous right now for Chavez. If one is to believe the polling data, Chavez could lose the upcoming elections. An American smuggling arms a few weeks before such a critical vote could mobilize his supporters and others. 

Securing the release of Ocean Atlas captain will not be easy. The U.S. Congress reconvenes next week and company officials may already be scrambling to secure guidance and support from key Congressional offices as well as the Obama Administration. For U.S. companies doing business in these countries, factoring in the local politics has always been a consideration in risk mitigation and compliance analyses. As governments start to weaken, as in the case of Cuba and Venezuela, even more so. 

The parties were conducting business through Spain and, it appears, at least one Spanish defense contractor. In addition to spare parts for military aircraft, the parties were also trying to procure F-16 ejection seats, munitions, as well as aircraft engines.

Additional information about the matter is available at the U.S. Attorney’s website.

The announcements were published published on June 19, 2012 in the Federal Register and is part of the Obama Administration’s ongoing effort to reform the U.S. export control laws and regulations. The State Department proposed rule is available for review here, while the Department of Commerce proposed rule is available here. Public Comments are due by August 3, 2012. 

The United States Munitions List (USML) is a list of articles, services and related technical data that are designated as defense articles and defense services pursuant to sections 38 and 47(7) of the Arms Export Control Act (22 U.S.C. 2778 and 2794(7)). The USML is administered by the Department of State, Directorate of Defense Trade Controls (DDTC). The Commerce Control List (CCL) in Supplement No. 1 to Part 774 of the Export Administration Regulations
(EAR) contains a list that describes items (i.e., commodities, software, and technology) subject to the jurisdiction of the EAR. The EAR are administered by the Department of Commerce, Bureau of Industry and Security (BIS).

You can read the State Department Federal Register notice here and the Commerce Department notice here. For a very general overview of U.S. Trade Security laws and regulations, follow this link. Both agencies will be accepting comments on the proposed rule until July 23, 2012.