The Bureau of Industry and Security (BIS) announced July 26 that the mandatory reporting of requests to comply with unsanctioned foreign boycotts must now include the identity of the specific party who made the boycott-related request. This new requirement is effective immediately.
Antiboycott compliance may be the most overlooked area of trade compliance that we see in our practice, and it warrants a much higher priority than it is often given by many companies. We welcome the opportunity to discuss antiboycott due diligence and compliance processes with you. Please contact Bryan Brown or Sean Murray with questions.
Under the Export Administration Regulations (EAR), U.S. persons are required to notify BIS of any received request to comply with an unsanctioned foreign boycott. Prior to this change, only the country from which the request originated was required to be reported. The new rule will require companies to capture, track, and report this additional information as part of their antiboycott compliance processes. This change reflects a continuing expansion in enforcement of the Antiboycott Regulations and comes less than a year after BIS announced enhanced enforcement measures that included reprioritizing violation categories, mandatory admissions of misconduct in any settlement agreement, renewed focus on foreign subsidiaries of U.S. companies, increased penalties for Category B and C violations, and modification of the penalty calculus for Category A violations that now begin at the maximum penalty amount.