Day 1-Tuesday, January 28, 2014

8:30 Co-Chairs’ Welcome and Opening Remarks

Selena Hui-Garreaud
Director, Export Controls
Legal Services, Bombardier Aerospace (Montreal, QC)

8:45 KEYNOTE AND Q & A- Status of Export Control Reform, 2014 Priorities and EAR Compliance Expectations North of the Border: How the US Commerce Department is Interpreting and Applying New Rules to Canadian Industry

Benefit from a unique opportunity to gain in-person insights from a senior US Department of Commerce decision-maker. Gain critical updates on the implementation of recent changes, how the US Government is managing the regulatory transition, and what changes could be on the horizon for 2014 and beyond.

In response to numerous requests, this session will allow for extended Q & A.

9:45 KEYNOTE ADDRESS AND Q & A- The Future of ITAR Compliance in Canada: The US State Department Discusses Their Compliance Expectations for Your Canadian Operations amid Ongoing Reforms

While some items have moved from the USML to the U.S. Commerce Control List, the ITAR continues to have wide application to a breadth of industries in Canada. For the first time at this event, hear first-hand insights from a senior State Department decision-maker on the evolving ITAR compliance landscape, recent policy, developments, licensing processes and timeframes, and the management of the transition

Please bring your questions, as ample time will be left for Q & A.

10:30 Networking Coffee Break

10:45 EXPORT CONTROL REFORM IN PRACTICE – Industry Stakeholders Discuss Their Experiences with Managing Transitional, Compliance, Operational and Budgetary Issues

B.J. Demery
Chief, Engineering Trade Compliance
Bell Helicopter, A Textron Company (Fort Worth, TX)

Deirdre Haverty
Director, International and Export Compliance
Vector Aerospace (Toronto, ON)

Selena Hui-Garreaud
Director, Export Controls
Legal Services, Bombardier Aerospace (Montreal, QC)

Elisabeth S. Preston-Moderator
Partner
McMillan LLP (Ottawa, ON)

Through a review of concrete examples and challenges, industry experts will “take stock” of what they have seen since new rules have come into effect on October 15th, 2013 and January 6th, 2014. This practical roundtable discussion will also discuss what exporters are doing to prepare for more changes, and best practices for managing your global export compliance program during this period of transition.

Audience members are welcome to ask their questions, and share their experiences as well. Topics will include:

  • New regulatory burdens for industry under the EAR vs. the ITAR
  • Identifying and managing unique compliance issues posed by new and anticipated reforms
  • To what extent you need to overhaul your export and re-export compliance program, and IT systems
  • The most challenging aspects of complying with EAR recordkeeping, classification, and licensing requirements
  • Training and monitoring your personnel
  • Practical impact of the reforms on large and smaller businesses, including parents and subsidiaries U.S., Canadian and foreign companies
  • The transition: What you should have done by now vs. what can wait
  • Minimizing the costs of implementation

11:45 KEYNOTE ADDRESS AND Q & A-The Future of Canadian Export Controls amid Ongoing U.S. Reforms: CGD and DFAIT Speak on The Evolving Canadian Compliance Landscape, Permit Criteria and the Possible Alignment of Canada’s Export Control List with US Changes

Jennifer Stewart
Director General, Industrial Security Sector
Public Works and Government Services Canada (Ottawa, ON)

Stephen de Boer
Director General
Foreign Affairs, Trade and Development Canada (Ottawa, ON)

Milos Barutciski – Panel Moderator
Partner
Bennett Jones LLP (Toronto, ON)

  • Status of efforts to align Canada’s Export Control List with U.S. requirements, including Controlled Goods and EAR 600 Series Items
  • Will CGD clearance apply to programs involving former ITAR items that have been moved to the EAR
  • Recent changes to Canada’s ECL Recent amendments to Schedule of Controlled Goods
  • How DFAIT assess permit applications

12:45 Networking Luncheon

2:00 Contrasting the Definitions of “Specially Designed” under the EAR, ITAR and Canada’s Export Control List: How to Apply Recent Changes to the Classification of Military and Commercial Items

Brandt Pasco
Attorney
Kaye Scholer LLP (Washington, DC)
Founding Member, National Security Council Task Force on Export Control Reform

Cliff Sosnow
Partner
Fasken Martineau DuMoulin LLP (Ottawa, ON)

  • How the new definition differs from the old one
  • How to interpret the definition, and common misunderstandings to avoid
  • Applying the release provisions under 120.40(b)
  • Which items are exempt from being classified as “specially designed” Do’s and don’ts for self-classifying items as “specially designed”
  • Understanding how paragraph (a) works with the limiting scope of paragraph (b)

3:00 Networking Coffee Break

3:15 Avoiding the New Minefields of U.S. Re-Export & Re-Transfer Compliance: How to Implement New, Tricky EAR and ITAR Requirements, and Secure Authorizations

Kenneth S. Purchase
Director & Counsel, Legal Services Export Compliance
Pratt & Whitney Canada (Longueuil, QC)

Richard Baldwin
Director, Ethics & Compliance
Esterline Technology Corporation (Bellevue, WA)

Gary L. Stanley
President
Global Legal Services, PC (Washington, DC)

  • How U.S. export control reform has changed the compliance landscape for re-exports of defence and dual-use items and technology
  • How U.S. re-export and re-transfer controls are being applied to Canadian firms: U.S. Commerce and State Department criteria for reviewing re-export and re-transfer requests
  • When an authorization is required and why: Importing U.S. technology to incorporate into manufactured goods
  • Working closely with your U.S. counterpart and what to incorporate in your U.S. Government request Preventing delays in re-export licensing
  • Marketing products outside of Canada or disclosing U.S. technology to non-Canadian nationals within Canada

4:30 Preventing Defence Services Export Violations: Best Practices for Ensuring That Engineering Discussions and Technical Assistance Comply with EAR License Conditions and TAAs

Joseph D. Gustavus
Senior Principal
Miller Canfield (Troy, MI)

  • When providing services to a foreign party when offering a commercial or civilian product is a “defence service”
  • Vetting a proposed technical collaboration with a U.S. company to ensure ITAR tainting does not occur
  • When training on commercial items can become a defence service: Leveraging defence technical capabilities in commercial product development
  • Segregating business units to prevent commercial services from becoming ITAR-controlled
  • Preventing ITAR “taint” of commercial services
    • -how “defence services” can cover technical data related to EAR-controlled items
    • -when a dual-use business becomes ITAR-controlled
    • – preventing defence services export violations related to software development, technical support and assistance
  • Recent trends in TAA license provisos and EAR license conditions relating to technical and collaborative discussions
  • Training engineers on the scope of license provisos and exceptions
  • What resources the U.S. Commerce and state Departments expect companies to devote to training
  • Training in French and other languages: Key challenges and pitfalls
  • Tracking compliance by engineers, and how to flag potential issues before they occur


5:30 Conference Adjourns

Day 2-Wednesday, January 29, 2014

8:30 Co-Chairs’ Opening Remarks

8:35 What Can Now Trigger a Government Investigation of Your Export & Re-Export Activities: How Export Control Reform Has Changed the Enforcement Landscape and Increased Coordination between U.S. and Canadian Officials

Special Agent John Ward
US Homeland Security Investigations
International Affairs
US Department of Homeland Security (Attaché Office in Toronto)

  • How the U.S. Commerce Department will treat suspected and actual violations involving former USML items
  • What triggers suspicion amid ongoing reforms: Concrete examples, including technical data and hardware exports
  • How the agencies decipher between an egregious violation vs. an innocent mistake, and when an innocent mistake could still warrant further investigation and penalties
  • How the agencies investigate suspected export violations and collect evidence
  • When a case can become criminal: When the Department of Justice will prosecute companies and individuals for ITAR violations, and the potential criminal penalties
  • When and how the RCMP gets involved in a case
  • The extent of U.S. cooperation with Canadian agencies, and case referrals: When an investigation by one agency could lead to more enforcement actions by Canadian and U.S. authorities
  • How administrative, civil and criminal penalties are being calculated: Mitigating and aggravating factors affecting the final number
  • Criminal sentencing trends: Extent of potential jail time
  • Practical impact of U.S. export control reform on enforcement and penalties
  • New U.S. E2C2 Center: How U.S. agencies will coordinate and step up enforcement actions
  • Changes to the Canadian export penalty structure and how they are being applied


9:30 Hiring U.S. Citizens and Other Nationals for Your Canadian Business: Juggling Canada’s Enhanced Security Strategy, EAR and ITAR Nationality Rules with Canadian Human Rights and Privacy Laws

Daniel Marion
Vice President, General Counsel & Corporate Secretary
Thales Canada (Toronto, ON)

Larry E. Christensen
Member
Miller & Chevalier Chartered (Washington, DC)

  • Incorporating new EAR requirements into your recruitment and hiring process: The overlap and differences between ITAR, EAR and CGP rules regarding nationality How U.S. export controls affect the hiring of U.S. citizens in Canada, including the “last acquired citizenship” rule under the EAR Short term temporary workers:
    • -how they are defined under ITAR 124.16 and 125.18-how defined
    • -managing conflicts between the ITAR and Canadian employment laws Permissibility of questions under Canadian human rights and privacy laws
    • – questions that you can/cannot ask with regard to nationality
    • – timing of questions
    • – how to phrase questions How Canada’s Enhanced Security Strategy dovetails with the ITAR 126.18 exemption Changing your approach to hiring decisions, and how to deal with candidates who don’t meet security requirements
  • U.S. export controls language to incorporate into your offer letters, employment agreements and using non-disclosure agreements (NDAs)

10:30 Networking Coffee Break

FOCUS ON LICENSE EXCEPTIONS

10:45 How to Use EAR License Exceptions to Support Your Re-Export Activities: Where Canadian Companies Go Wrong in Applying Eligibility Criteria under Exceptions STA, TSR and Others

Stephen F. Propst
Partner
Hogan Lovells LLP (Washington, DC)

  • Key exceptions and their scope of application
    • – STA
    • – Temporary Imports, Exports, and Reexports (TMP)
    • – Additional Permissive Reexports (APR)
    • – de minimis
    • – TSR (Technology & Software Restricted)
    • – TSU (Technology & Software Unrestricted)
    • – foreign direct product rule
    • – controls based on US persons or products
    • – Servicing & Replacement of Parts and Equipment (RPL)
    • – U.S. Government Exceptions
    • – Repairs
    • – LVS
  • License exceptions for the export and re-export of 600 series items
  • When 600 series items will and will NOT qualify for the STA (Strategic Trade Authorization) exception
  • License exceptions that can be used for sharing technology with foreign subsidiaries

11:45 When You Can Still Use ITAR Exemptions amid New US Reforms: Applying the Canadian Exemption to Your Manufacturing, Procurement, Business Development and Export Activities

Jason M. Silverman
Partner
McKenna Long & Aldridge LLP (Washington, DC)

  • Key exemptions, and when they apply and common mistakes that lead to misuse:
    • -Canadian Exemption: Who can use it and when, including its application to defence services, technical data and “build-to-print” tasks
    • -shipments by and for US Government agencies
    • -exemptions for plant visits
    • -maintenance exemption
    • -exports to US subsidiaries
    • -data for NATO and other country bid proposals
  • Which exemptions apply to transfers of technical data only vs. transfers of defence services AND technical data
  • How determine applicability of an exemption, and common mistakes to avoid in your determination
  • How the U.S. Government interprets the exemptions, and determines the consequences of misuse
  • Complying with recordkeeping and reporting requirements under the exemptions; shipping documents

12:15 Networking Luncheon

1:30 Amending TAAs and ITAR Licenses Before They Become Null and Void: How to Work with Your U.S. Suppliers and Customers to Ensure Your Authorizations are in Line with New Requirements

  • Assessing what needs to be amended, and the impact of U.S. export control reform How to prepare an amendment application What to look for in a TAA and WDA
  • -ensuring the draft TAA clearly defines territory where tech data exports can occur
  • -evaluating the scope of nationality coverage and if coverage is enough to facilitate adequate exchange of technical data
  • -incorporating derived data into TAAs
  • -determining your nationality base and ensuring coverage in agreements
  • -ensuring Canadian sub-licensees and sub-consignees are identified, including in-house service providers
  • -tracking and valuing defence services and technical data: key data to provide to your U.S. counterpart
  • Ensuring correct invoicing, shipment documentation and classification by U.S. suppliers
  • Concrete examples of successful amendment techniques
  • Working with your U.S. counterpart to ensure seamless post-license and agreement implementation


2:30 Updating Your Export & Re-Export Recordkeeping Procedures to Align with Reforms: Satisfying New EAR and ITAR Requirements for Record Retention, Retrieval and Destruction

B.J. Demery
Chief, Engineering Trade Compliance
Bell Helicopter, A Textron Company (Fort Worth, TX)

  • Key recordkeeping requirements in the EAR Reporting technical data exports, and data disclosed over the life of a license Types of records that need to be retained and how, including:
  • − transport documents
  • − licenses and supporting documentation
  • − memoranda, notes and correspondence
  • − contracts, accounting and financial records
  • Coordinating with sales, shipping, logistics, accounts payable and other departments to coordinate and centralize recordkeeping
  • Developing data maintenance, preservation, retrieval and destruction procedures for your domestic and overseas offices
  • Updating automation tools, and how to assess available software and vendors
  • How long to retain records, and how to dispose of them
  • When and how U.S. agencies can inspect your records, and what they look for

3:00 Networking Refreshment Break

3:15 Managing New, Emerging Economic Sanctions Risks Affecting the Aerospace, Technology, Petroleum and Other Industries: What Can Trigger Business Interruptions, Shipment Seizures, Penalties and Prosecutions

Benjamin H. Flowe, Jr.
Senior Partner
Berliner, Corcoran & Rowe, LLP (Washington, DC)


Greg Kanargelidis
Partner
Blakes, Cassels & Graydon LLP (Toronto, ON)

Iran

  • The New Iran Threat Reduction and Syria Human Rights Act, and its application to Canadian subsidiaries of US companies
  • How the U.S. Comprehensive Iran Sanctions, Accountability and Divestment Act (CISADA) affects US and non-US entities, and their subsidiaries and affiliates: The scope of activities and “investments” that are captured
  • When US and non-US exporters face penalties, denial of export and banking privileges, foreign exchange transactions, and asset freezing
  • Scope of exceptions to the requirements, and how to use them
  • Canada’s sanctions against Iran:: Special Economic Measures Act, United Nations Act regulations, and Export and Import Permits Act: Application inside and outside Canada

Syria

  • Exports of US origin content and re-exports to Syria: Who is captured by current U.S. and sanctions, and what export activities remain permissible
  • How U.S. and Canadian sanctions against Syria are evolving

Burma

  • Scope of permitted/prohibited investment activities under newly eased U.S. and Canadian sanctions
  • When goods can be shipped or re-sold by foreign affiliates
  • When transfers of funds to or from a blocked financial institution’s account are prohibited

Cuba

  • Restriction on procurement activities
  • The extraterritorial reach of the U.S. trade embargo against Cuba
  • Key conflicts between Canadian blocking measures and U.S. trade control requirements: What to do when Canadian blocking measures are triggered
  • Assessing the risks of enforcement and penalties by OFAC and DFAIT

FOCUS ON BROKERING, END-USE, END-USER & SUPPLY CHAIN MANAGEMENT


4:15 The Extraterritorial Reach of New ITAR Brokering Rules to Canada: What New Rules Mean for Your Export & Re-Export Activities

Giovanna M. Cinelli
Partner
Jones Day LLP (Washington, DC)

  • Status of proposed rules, and how they differ from existing requirements
  • What activities constitute “brokering”? Who is a “broker”?
  • Application to foreign persons otherwise subject to U.S. jurisdiction, including distributors and agents
  • When and how to get ITAR license approvals for brokers, and meet reporting requirements
  • Satisfying “prior notification” requirements and exemptions for large exporters and SMEs
  • Best practices for broker agreements and activities: Compliance checklist
  • Monitoring compliance by foreign agents and representatives

4:45 How to Comply with EAR, ITAR and Canadian Supply Chain Due Diligence, End-Use and End-User Requirements: Vetting and Monitoring Suppliers, Distributors, Freight Forwarders and Other Third Parties

  • Conducting due diligence of suppliers, freight forwarders, distributors, customs brokers, customers, re-sellers and other third parties: What to look for and ask
  • The scope of a Canadian firm’s liability for U.S. export violations by third parties
  • Flowing down EAR and ITAR obligations: Contractual safeguards to implement for orders and shipments
  • Nature and extent of audit rights to include in third party contracts, and how to exercise them
  • Tracking supplier and other third party outsourcing and export activities
  • Complying with EAR and ITAR end-use and end-user restrictions
  • Verifying end-use and the end-user overseas, and when to secure a license from the U.S. State or Commerce Department
  • What to do if the end-user has export activities to sanctioned countries
  • Reducing the risk of diversion and trans-shipments
  • Ensuring your suppliers are DDTC registered, and when second, third and fourth tier suppliers need to be registered

5:30 Conference Concludes

Monday, January 27, 2014-Pre-Conference Working Groups

Working Group A-9:00 a.m.-12:30 p.m.

The Ins and Outs of Classifying and Re-Classifying Your Data, Technology, Products, Parts and Components: How to Determine the Correct ECCN Number and Ensure Correct Calculations under the de minimis Rule

  • What is now covered under the Commerce Control List (CCL)
  • Factors to consider when determining whether an item is EAR-controlled
  • Navigating ECCN categories and groups
  • How to determine the ECCN for your product:
    • when to contact the manufacturer, producer or developer of the product selecting the appropriate category and group that most accurately fits your product
    • reviewing the general characteristics of your item and identifying the appropriate section of the CCL
    • matching the specific characteristics of your item to an ECCN
  • Demystifying the “reasons for control” listed within ECCN categories, and assessing whether a license is required
  • How export control reform will affect the classification of your items and technologies, and migration to the CCL
  • The scope and application of EAR99
  • Key elements for developing classification procedures and a matrix for assessing EAR jurisdiction
  • What questions to ask when classifying new and innovative technologies: Conducting market and IT functionality analysis
  • What is considered “publically available”?
  • The varying degrees of export control under ECCNs based on the country of end-use
  • How to interpret and apply the de minimis rule to 600 Series and Other CCL Items
    • core elements of the de minimis rule
    • how to do a calculation under the rule
    • calculations for Canadian produced hardware that is bundled with U.S.-origin software: Key methodologies
    • defining “controlled” and “incorporate”
    • when a U.S. company can help Canadian affiliates perform de minimis calculations
    • special considerations for 600 series items:
  • What to do after obtaining the ECCN: How to review the Commerce Country Chart to determine whether an export license is required
  • Restrictions under ECCNs that apply to certain denied parties
  • What to do if no ECCN fits your product, and determining whether a license is not required
  • When and how to submit a CCATs

Working Group B-1:30 p.m.-5:00 p.m.

When and How to Secure a License from the US Department of Commerce: Practical Guide to Using Form 748P AND SNAP-R, and Preventing Delays

  • Determining when a license is and is NOT required
  • Export control reform transition rules affecting EAR licensing
  • Key differences between a general license vs. an individually validated license
  • The approvals process, timeframe and how to reduce the risk of delay
  • How to fill out the SNAP-R form
  • New licensing techniques: What to include and how to submit the application
  • how to fill out the forms
  • what BIS expects, looks for and requires
  • supplemental information required
  • developing data sheets, end-user statements, and cover letters
  • How to complete the SNAP-R Form
  • Preparing supporting documentation: verification of ECCN’s end-use of items to be exported
    • supporting documents supplied by the prospective purchaser or the government of the country of the ultimate destination
    • international import certificate
    • statement of ultimate consignee and purchaser
  • How licensing determinations are made by BIS
  • What triggers an RWA
  • When and how to amend a license