"US Government Announces Ban on High-Technology Exports to Russia and Crimea"

by Skadden, Arps, Slate, Meagher & Flom LLP
Contact

On April 28, 2014, as part of its evolving response to the situation in Ukraine, the White House announced new restrictions on exports of “high-technology” items and services to Russia and Crimea. The announcement also signaled that the U.S. government will begin subjecting certain Russian-owned and controlled entities to increased scrutiny under the U.S. export control regime. These latest moves come on the heels of a series of measures imposing economic sanctions on numerous individuals and firms and suspending the issuance of new licenses for the export and re-export of controlled goods and services to Russia and Crimea.1 Companies engaged in transactions involving U.S.-origin defense, aerospace, electronics, and other high-technology items and services — as well as those dealing with the newly designated Russian entities — will need to continue to pay careful attention to the changing U.S. controls on exports and re-exports to Russia and Crimea to ensure that they do not incur significant civil and criminal liability.

To implement the latest export restrictions, the Directorate of Defense Trade Controls (DDTC) of the U.S. State Department has announced that it will immediately revoke existing licenses for the export and re-export of “any high-technology defense articles or services regulated under the U.S. Munitions List to Russia or occupied Crimea that contribute to Russia’s military capabilities.” DDTC also will deny any new or pending licenses going forward. The U.S. Department of Commerce, Bureau of Industry and Security (BIS) — which has jurisdiction over U.S.-origin “dual-use” goods, technologies and software — has now confirmed that it also will deny new and pending license applications and revoke existing licenses for exports and re-exports of high-technology dual-use items to Russia and Crimea. Moreover, DDTC and BIS have both stated that they will evaluate all other new and pending license applications and existing licenses on a case-by-case basis to “determine their contribution to Russia’s military capabilities.”

In a related development, BIS has identified 13 Russian-owned and controlled firms that will be subject to dual-use export controls and placed them on its Entity List. As a result, a license will be required for the export, re-export or transfer of designated dual-use goods and services to such firms and their subsidiaries (wherever located), and license applications will be subject to a presumption of denial.

Thus far, no guidance has been issued on the specific goods and services that will be considered high-technology items subject to the new restrictions. DDTC and BIS also have not announced any criteria that can be used to identify specific transactions that are likely to “contribute to Russia’s military capabilities.”

Failure to comply with the U.S. government’s new and changing requirements in this area can result in costly violations of U.S. export control laws. To mitigate the risk of such violations, companies should continue to closely monitor agency announcements and cautiously approach any defense- and high-technology-related transactions involving Russia, Crimea and any of the Russia-owned or controlled entities designated by BIS.

Skadden’s U.S. export controls and economic sanctions team is following these developments closely. We encourage you to contact any of the attorneys listed here or your regular Skadden contact with any questions specific to your situation or business.

1 See “US Government Halts Licensing for Key Exports to Russia in Response to Events in Ukraine” (April 4, 2014), available at http://www.skadden.com/insights/us-government-halts-licensing-key-exports-russia-response-events-ukraine; and “An Update on Economic Sanctions Related to Events in Ukraine” (March 26, 2014), available at http://www.skadden.com/insights/an-update-on-economic-sanctions-related-to-events-ukraine-march-26-2014.

Download PDF

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Skadden, Arps, Slate, Meagher & Flom LLP | Attorney Advertising

Written by:

Skadden, Arps, Slate, Meagher & Flom LLP
Contact
more
less

Skadden, Arps, Slate, Meagher & Flom LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.