BIS Unverified List Imposes New Requirements for Exporters
Effective January 21, 2014, all license exceptions are suspended for exports, reexports and transfers to parties listed on the Unverified List (UVL). In addition, exporters must file an Automated Export System record for all exports to parties listed on the UVL and obtain a statement from such parties prior to exporting, reexporting, or transferring to such parties any item subject to the EAR which is not subject to a license requirement. For more information, please consult the Federal Register (78 FR 76741).
Originally published in the Federal Register in a proposed rule on September 11, 2013, BIS will soon implement a number of key changes to the UVL:
- All parties currently listed on the UVL will be removed; entities will subsequently be added to a new UVL, with such additions announced in the Federal Register.
- Exporters will need to file an AES record for all exports to which a person listed on the UVL is a party. This requirement applies regardless of value or destination, (i.e. shipments to Canada or Low Value Shipments that involve a person listed on the UVL as a party are now subject to AES filing requirements).
- No license exceptions will apply for exports, re-exports, and transfers (in-country) of items subject to the EAR to persons listed on the UVL. Where an item otherwise requires a license (for example because of its classification and destination, end-use or end-user) an exporter must apply to BIS for a license.
- For those transactions in which there is no license required under the EAR, exporters must obtain a signed and dated UVL statement from UVL-listed persons before proceeding with any export, re-export, or transfer involving such person. The UVL-listed person must certify the end use, end user, and country of ultimate destination of items subject to the EAR, and must consent to an end-use check by the U.S. Government.
First established in 2002, the UVL is a list of persons in foreign countries who were parties to past export transactions with respect to which pre-license checks or post-shipment verifications could not be conducted as well as entities for which BIS cannot verify the existence or authenticity of the end user or other parties to the export transaction. BIS periodically issues Federal Register notices that add to or remove persons from the UVL. Designation of a party on the UVL in a proposed transaction raises a “red flag” for purposes of the “Know your Customer” guidance, which is set forth in Supplement No. 3 to Part 732 of the Export Administration Regulations. If a proposed transaction therefore involves a party on the UVL, by law the exporter or re-exporter has an affirmative duty to inquire, verify, or otherwise satisfy itself that the transaction does not involve a proliferation activity or otherwise violate the EAR. Under the new rules, exporters will have the additional obligations described in the bullet points above.
The current UVL is available on the BIS website: https://www.bis.doc.gov/index.php/forms-documents/consolidated-entity-list/unverified-list/1053-unverified-list.
This current version does not reflect the parties that will be removed as of January 21. It is also unclear how quickly it will be updated to reflect parties added through Federal Register announcements although it is reasonable to assume that it should be updated quickly after any such announcements.