AIR-SEA FORWARDERS, INC. MANAGERS MEETING

During the week of 8 – 14 June 2008, AIR-SEA FORWARDERS Head Office in Los Angeles hosted a meeting of all Managers and the ASF Board of Directors. Attending were the Managers of the LAX Departments, and the District Managers of ASF Offices in Atlanta, Boston, Chicago, Dallas, Houston, Miami, New York, San Francisco and Seattle. The result was a most productive and enjoyable meeting, on a very personal basis, which enabled all ASF Managers to establish close relationships amongst themselves and get to know our Top Management and our Board of Directors. The highlight of the meeting was the unanimous approval of the Board of Directors of the appointment of Todd Hinkley as the ASF Chief Executive Officer, to the overwhelming approval of all attendees. Emil Justrich will continue with his administrative duties and will be available to discuss high level decisions with Todd and the Board of Directors. We all look forward to the future with great confidence.

 CBP Develops New Online Trade Violation Reporting System

U.S. Customs and Border Protection’s Office of International Trade has developed a new online trade violation reporting system called eAllegations to provide concerned members of the public a means to confidentially report suspected trade violations to CBP.

Beginning June 17, members of the public may report information regarding suspected violations via a new online form on the CBP Website. “E-Allegations.”

CBP has established this reporting system to make it easier for the public to notify CBP of possible trade violations. CBP will confidentially research concerns, determine the validity of the allegations and any actions required based on the subsequent review.

To report a possible violation, an individual must submit the following information: the type of trade violation, description of what has occurred, the products or goods involved and the alleged violator’s name and/or company. Other information may be included on a voluntary basis.

eAllegations is not intended for assertions of security issues such as terrorists or weapons of mass destruction. Violations that may be reported online through eAllegations include misclassification of merchandise, country of origin markings, health and safety violations, intellectual property rights violations, textile or other trade violations.

For example, eAllegations will provide a means to report a possible violator who is importing substandard steel, claiming that it is of a higher grade, therefore creating a potential safety issue. Other possible violations that can be reported include a company claiming a lower than actual value on a product they are importing to pay less duty or a company who is importing textiles from one country but stating that the goods are from another country to avoid quota restrictions.

Concerned members of the public bring to light many trade violations and it is in the U.S. Government’s best interest to make it as easy as possible for the public to report possible violations. All information submitted to CBP is voluntary and confidential.

Source: Customs and Border Protection

 TACA to Cease Operations on June 30th, 2008

Due to a ruling by the EU Council, which essentially blocks liner conferences, the TACA members have all agreed to bring the TACA operations to an end. Effective July 1st, 2008, TACA tariffs will not be available. Individual carriers will begin carrying their own rates and regulations concerning trade.

Source: The Trans Atlantic Conference Agreement

 California Customs and Border Protection Officers Seize $22 Million in Counterfeit Imported Merchandise

U.S. Customs and Border Protection announced the seizure of approximately $22,740,000 Manufactured Suggested Retail Price ($623,540 Domestic Value) in merchandise from China, at the Oakland Seaport.

On May 9, 2008, CBP officers inspected shipping containers, which had recently been unladen off the M/V Kota Salam arriving from China. The goods were manifested as luggage, but inspection of the cargo by CBP officers revealed counterfeit Gucci, Prada, Jimmy Choo, Bulgari, Cartier, Chanel, Versace, Juicy Couture and other fraudulent brand name merchandise. Labels for various designers were also found hidden three suitcases deep (one inside the other). These labels are normally tagged onto a cheaply made product to make it seem as though it is an authentic item.

San Francisco CBP Director of Field Operations Richard Vigna said, “The manufacturing of fake products for sale takes millions of dollars away from the trademark holder. Diligent work by CBP officers across the nation helps to end this type of fraudulent activity.”

One CBP initiative to combat terrorism and trade fraud is the Customs Trade Partnership Against Terrorism (C-TPAT). C-TPAT is a joint government and business initiative that builds cooperative relationships to strengthen the overall trade supply chain along with border security enforcement. “CBP works closely with importers, brokers, carriers, warehouse operators and manufacturers to enforce national regulations for imported goods,” said CBP acting Port Director Dora Murphy.

CBP seizes millions of dollars in counterfeit merchandise at seaports throughout the nation for registered and recorded trademark holders. The Port of Oakland is one of the top ten seaports in the U.S. for receipt of foreign containers with 20,000 – 30,000 importations per month for processing into the U.S. economy.

Source: Customs and Border Protection

 Indonesian citizen convicted in scheme to export military scopes

Erik C. Peterson, United States Attorney for the Western District of Wisconsin, announced that an Indonesian citizen, was convicted of conspiracy to violate the Arms Export Control Act yesterday following a two-day jury trial in federal court in Madison. U.S. District Judge Barbara B. Crabb scheduled sentencing for July 28, 2008 at 1:00 p.m. the citizen faces a maximum penalty of ten years in prison.

The evidence at trial established that the citizen was a member of an international conspiracy to illegally export 100 Leupold Mark 4 CQ/T Riflescopes out of the United States. The tactical riflescopes have infrared capability and are designed to attach to M-16 and AR-15 assault rifles. The State Department has classified the riflescopes as "defense articles" under the Arms Export Control Act and they are therefore subject to the export regulations in the International Traffic in Arms Regulations.

The evidence also established that the citizen took steps to try and further the conspiracy here in the Western District of Wisconsin, specifically in the Cashton, Wis. area. On July 31, 2007, defendant sent an e-mail from Indonesia to a business associate in Cashton and instructed him to order 100 Leupold Mark 4 CQ/T Riflescopes for the defendant. The citizen asked this person to have the scopes shipped temporarily to the person's home in the Western District of Wisconsin, for later shipment overseas. The citizen also asked this person not to tell the company that the items were going to Indonesia.

When that business associate refused to assist him, the citizen approached a second individual in the Cashton area while the defendant was visiting the United States on September 26, 2007. The citizen asked the individual to purchase 100 Leupold Mark 4 CQ/T Riflescopes and ship them to Saudi Arabia, where the defendant would later have them shipped to Indonesia. In exchange for this individual's assistance, the citizen offered to pay him $100,000, which was $30,000 more than the cost of the scopes themselves.

After the encounter with the citizen, the individual contacted the Federal Bureau of Investigation. On September 27, 2007, the FBI interviewed the defendant. The citizen provided a variety of different reasons for wanting the scopes. The citizen was traveling with two Indonesian passports with different dates of birth. His real date of birth has not yet been determined.

Source: U.S. Department of Justice

 Technology Leadership and National Security - Keynote Address

Mario Mancuso Under Secretary of Commerce - Bureau of Industry and Security U.S. Department of Commerce

As a national security bureau within an economic agency, the Bureau of Industry and Security’s most solemn obligation is to protect the security of the nation. As a result, when we approach export controls, we don’t “balance” trade and security. That’s not our job; it’s not what we do. There’s nothing of comparable worth against which we “trade-off” U.S. security. Instead, our export control policy is designed to enhance U.S. national security by (i) denying the acquisition of sensitive technologies to actual or potential adversaries, and (ii) by promoting continued U.S. strategic technology leadership.

During my time at BIS, a few thoughts have occurred to me that I’d like to share with you. First, I’m convinced that we need - as a government - to engage the real policy issues, and not just the regulatory issues that export controls raise. My sincere hope is that this study will spark genuine interest in the big question of how our nation can - and should - sift risk from opportunity in a world which has more of both, and at the same time is faster and more connected.

The export control system is a tool intended to promote our particular policy objectives. It is not an end in itself. For this reason, the stakeholders in this debate include everyone in our country, and not only those who are familiar with or subject to the controls themselves. We also need to stop, look and listen. We need to put in the effort to understand the world as it exists today to ensure that the controls we would propose to apply are actually suited for the task, that they actually further our policy ends.

We’re very fortunate to have exceptionally talented civil servants in our government. Nonetheless, we need to build in our departments and agencies deeper reservoirs of institutional understanding of how our world has changed since the end of the Cold War—and how it is changing still. Globalization is reordering our world, and we need to better understand how the many facets of globalization—economic, social, technological, and political— are affecting our nation’s security profile and interests, and shaping the contours and exercise of our instruments of national power. Today’s national security threats are more numerous and varied than ever before. They include state-based threats and threats from non-state actors; threats arising from disruptive technologies and, of course, the specter of catastrophic terrorism.

At the same time, the international economic landscape has changed profoundly. The very success of our post-war economic diplomacy, the end of the Cold War, and globalization generally, has increased the pool of world-class competitors and altered the dynamics of global economic competition. Technology, talent and capital are now ubiquitous, and the U.S. must now compete economically and technologically with the rest of the world, including not only Europe and Japan, but also China and India, as well as Brazil, Korea, Indonesia—and the list goes on.

Consider this:

1) This past year a research university opened its doors in Saudi Arabia. On the day it opened it had an endowment roughly equal to that of MIT-- except it took MIT 142 years to get there.

2) By 2010, if current trends continue, more than 90% of all scientists and engineers will be living in Asia.

3) Today, a third of the world’s R&D staff are already located in India and China.

4) And a recent study by Booz Allen and INSEAD, a leading business school in Europe, estimated that 75% of the new R&D sites planned to be established over the next couple of years will be in India and China.

But there’s more. The very alchemy of our military’s technological superiority has also changed. In the past, approximately 2/3rds of our nation’s military technologies were developed in a defense R&D setting, with the remaining third coming from adaptations of commercial, off-the-shelf technologies. Today, those proportions have been almost exactly reversed. In the aggregate, these changes are not altogether a bad thing. In fact, the U.S. welcomes the integration of developing countries into a rules-based global economy.

But these changes have (i) challenged the core assumption of our export controls— i.e., that we have something that others do not, (ii) complicated the political economy of our national security, and (iii) further elevated the salience of U.S. technology and economic leadership. In this strategic environment, one which is altering the structure of our industrial and innovation base and reshaping the technological environment in which our military must compete, we can no longer rely exclusively on export controls to maintain our strategic technology leadership. We need to complement smart and effective export controls with an affirmative strategy to “outdistance” our competitors, to remain the most innovative and competitive economy in the world.

While more needs to be done, real progress is being made. First, the dual-use directive signed by the President on January 22nd did more than enumerate specific initiatives for the executive branch to accomplish. It reframed the larger policy context to account for the sweeping changes I described. This is a historic change because it memorializes the fact that we live in a new world, and it directs the departments and agencies to pivot accordingly. Within the Department of Commerce itself, we are pursuing a focused policy agenda to implement, and build upon, the President’s reform vision.

First, we are strengthening our enforcement architecture and refocusing our enforcement activities.

We firmly believe that enforcement reform is inextricably linked to export control reform. And an important part of this effort is the renewal of our bedrock dual-use export control law, the Export Administration Act (EAA), which this Administration recently proposed and which Senator Dodd introduced. Foreign locations increasingly serve as the venues for commercial activities that could threaten U.S. and international security, and we are committed to enhancing our law enforcement capabilities to investigate, uncover, and stop these activities wherever they may occur.

Passing the EAA would also have another important benefit: it will bolster our diplomatic efforts around the world to encourage other countries to adopt and fully enforce their own export control laws. This is especially important to us in our efforts with respect to terrorists, proliferators, and nations of transshipment concern. It is very difficult to make a credible and persuasive case to other nations to enact effective export control laws when our own country does not have a permanent law on the books.

Second, we’re updating our controls to reflect the global economic landscape.

We have developed a regular process for systematic review of the list on controlled dual-use items, including controls for encryption products, re-exports, and deemed exports. We’re also moving towards an end-user based system by establishing VEU for China and India, and by evaluating the contours of an intra-company transfer license exception which would better account for how cutting-edge R&D occurs today.

Finally, we’re also accelerating our engagement with the most innovative markets in the world to facilitate vibrant, cross-border, people-people networks to anchor important technology relationships for the future.

One such important relationship already exists with India. In late February, I was in New Delhi to co-chair with Foreign Secretary Menon the U.S.-India High Technology Cooperation Group. At this event, our governments agreed to work with each other to proactively revisit our respective regulatory regimes to find appropriate and constructive ways to expand bilateral opportunities and collaboration across a number of industries, including nanotechnology, biotechnology, information technology, and strategic and defense trade. Our meetings resulted in a road map of discrete actions, which our governments have begun to implement over the next 9 months. Another such dialogue was recently established with the government of Israel. This past August, the U.S. and Israel agreed to establish the U.S.-Israel High Technology Forum (HTF) to facilitate secure bilateral high technology trade and investment. Each of these dialogues has a strategic rationale of its own. But both create real linkages with exciting technology markets and critical foreign policy partners for the long-term.

Source: Bureau of Industry and Security

 TACA Announces the Latest BAF and CAF Adjustments

The Trans-Atlantic Conference Agreement (TACA) announces that the BAF will remain unchanged until at least July 15th, 2008. Below are the current levels:

To, From and Via – Atlantic/Gulf Coast Ports:

$607.00 per 20ft container
$1214.00 per 40/45ft container
$61.00 Weight or Measure

To, From and Via – Pacific Coast Ports

$911.00 per 20ft container
$1822.00 per 40/45ft container
$91.00 Weight or Measure

TACA has also advised that the Currency Adjustment Factor (CAF) will be remain at 15%, through at least July 15th, 2008.

Below are the lines associated with TACA:

Atlantic Container Line A.B.
Maersk Line
Mediterranean Shipping Co.
Nippon Yusen Kaisha (NYK) Line
Orient Overseas Container Line

Source: The Transatlantic Conference Agreement

 CBP Seizes More Fake Nike Shoes at LA/Long Beach Seaport

U.S. Customs and Border Protection officers at Los Angeles/Long Beach seaport continue to seize millions of dollars worth of counterfeit Nike footwear. In the latest seizure on May 5, CBP officers confiscated 18,560 pairs of fake Nike athletic shoes and 252 pairs of generic shoes that were put at the tail of the container to conceal the counterfeit Nikes – the scheme didn’t work.

The appraised domestic value of the shipment was $521,000. Had the shoes been legitimate the value would have been $2.6 million. Nike officials advised CBP that they had not authorized the importer or exporter to use their trademark.

Kevin Weeks, director of CBP Los Angeles Field Operations said, "Fiscal year 2008 is shaping up as a record year for CBP seizures of counterfeit goods entering LA/Long Beach seaport. As of mid-year, CBP in the Port of Los Angeles/Long Beach has seized significantly more fake goods than fiscal year 2007, which totaled over $20.6 million worth of counterfeit products."

In this incident two shipping containers that arrived at the Port of Long Beach from China were selected for CBP examination on May 5. The contents were declared as "drainage pipeline fitting." Following intensive inspection of the shipment CBP officers discovered the counterfeits and seized the goods for federal violation of merchandise bearing a counterfeit trademark. Due to the false manifest, smuggling charges were added to the offense. The shoes were consigned to an importer in New York - likely a fictitious address.

The 18,560 pairs of fake Nike Air Force 1 ‘07 and Air Jordan 4 shoes will be destroyed.

Source: Customs and Border Protection

 Louisiana Firm Settles Charges of Illegal Exports to Iran

The U.S. Commerce Department’s Bureau of Industry and Security (BIS) announced that a Louisiana Corporation has agreed to pay $132,791 in civil penalties to settle a charge that it violated the Export Administration Regulations (EAR). BIS alleges that between March 1995 and February 2007, the corporation conspired to export a U.S.-origin engineering software program controlled for anti-terrorism reasons through Brazil to Iran without the required U.S. Government authorization.

“We will actively pursue, prosecute and punish those who violate U.S. law and illegally export to Iran, a state sponsor of terrorism,” said Under Secretary of Commerce Mario Mancuso. “We will continue to work with our international partners to prevent the illegal transshipment of U.S-controlled items to Iran and other bad actors.”

The corporation and its co-conspirators devised and employed a scheme to market, sell, and service the engineering software program to Iranian clients through a Brazilian co-conspirator. In a related action, the U.S. Department of Justice announced that the corporation’s owners, two individuals, pled guilty on April 24, 2008, in New Orleans to a one-count bill of information charging them with conspiracy to violate the International Emergency Economic Powers Act and the Iranian Transactions Regulations.

Under Secretary Mancuso praised the BIS Office of Export Enforcement’s Houston Office for its outstanding work on this case.

BIS controls the export and re-export of dual-use commodities, technology, and software for reasons of national security, foreign policy, nuclear nonproliferation, chemical and biological weapons nonproliferation, regional stability, and short supply. Criminal penalties and administrative sanctions can be imposed for violations of the Regulations.

Source: Bureau of Industry and Security

 Recent Export Enforcement Cases – February 2008 to March 2008

Power Amplifiers to China - On March 7, 2008, a U.S. corporation pled guilty to one count of violating the International Emergency Economic Powers Act in U.S. District Court for the Eastern District of Virginia. The investigation identified 11 occasions between October 2004 and February 2006 where the corporation exported power amplifiers from Reston, Virginia to the People’s Republic of China without obtaining the required Department of Commerce license.

Electronic Components to List Entities in India - On March 13, 2008, a U.S. individual pled guilty to one count of 18 USC 371, Conspiracy to violate the Export Administration Regulations, the International Emergency Economic Powers Act, the International Traffic in Arms Regulation and the Arms Export Control Act in U.S. District Court for the District of Columbia. Beginning in or around October 2002 and continuing in or around September 2006, the individual conspired with others to export electronic components to Entity List organizations. The electronic components exported included semiconductors and capacitors with applications in missile guidance and firing systems. These items were exported to the Vikram Sarabhai Space Center (VSSC), the organization responsible for satellite and rocket launch vehicle development, and Bharat Dynamics Limited (BDL), the prime production agency for missiles developed by the Indian Defense Research and Development Organization, without first obtaining the required licenses from the Department of Commerce. In order to accomplish this conspiracy, Cirrus Singapore received orders from these organizations for U.S. origin electronic components that they were restricted from receiving. The individual, along with his co-conspirators, contacted vendors in the United States and negotiated purchases of the electronic components on behalf of these Indian organizations.

Gun Parts to Sudan - On March 13, 2008, a U.S. individual and his wife, pled guilty in U.S. District Court in the Eastern District of Virginia to charges related to the smuggling of gun parts to the Sudan. The husband pled guilty to one count of 18 USC 554, Illegal smuggling from the U.S., and the wife pled guilty to one count of 18 USC 1001, Making false statements to Federal investigators relating to her activity.

Export of Rifle Scopes - On March 17, 2008, a U.S. Corporation, of Mountoursville, Pennsylvania, pled guilty to violating one count of violating the International Emergency Economic Powers Act and one count of violating the International Traffic in Arms Regulations in connection with the illegal export of Department of Commerce and Department of State licensable rifle scopes. The plea occurred in U.S. District Court, Middle District of Pennsylvania.

Telecommunications Equipment and Technology to Iran - On March 18, 2008, a U.S. Corporation in Raleigh, North Carolina, pled guilty to one count of 18 USC 371, Conspiracy to export advanced telecommunication technology, from Singapore, through Dubai, United Arab Emirates, with an ultimate destination of Iran. The corporation designs and develops various high-speed fiber-optic telecommunications devices and a series of multi-service access platforms (iMAP). The iMAPs combine numerous functions, services, access technologies and protocols in one network element, and are one of the latest additions to high-speed communications. The high-speed telecommunication equipment would be manufactured in Singapore using U.S.-origin software technology. The equipment would then be shipped from Singapore to Iran via the United Arab Emirates without U.S. Government authorization.

Computers to Syria - On February 14, 2008, a U.S. individual, a resident of Houston, Texas, was sentenced in U.S. District Court for the Southern District of Texas in Houston to three years’ probation and ordered to pay a special assessment fee of $200 for two counts of violating the International Emergency Economic Powers Act, Title 50 U.S.C. 1705 (b), Attempted Export Without an Export License. He was also ordered to forfeit computers and related equipment valued at $32,000. The violations occurred in February 2003 when the individual and his company, exported computers and related equipment to Syria without a BIS export license. On September 12, 2006, a Final Order was issued by BIS resolving administrative charges against the individual and his company. The total administrative fine imposed against him and all his companies was $2,222,000. All but $71,000 was suspended. In addition, he and his companies were denied export privileges for 20 years.

Textile Goods to Iran - On February 8, 2008, in the U.S. District Court for the District of Columbia, a California resident was sentenced to 18 months’ imprisonment and to pay a $200,000 criminal fine for violating the U.S. embargo against Iran. The resident pled guilty to knowingly and willfully exporting textile goods to Iran without the required export licenses. Also on February 8, 2008, in the U.S. District Court for the District of Columbia, he was sentenced to 12 months’ probation for making false statements related to the same export. OEE and ICE jointly conducted this investigation.

Source: Bureau of Industry and Security

 TSA CCSP Outreach Forums - Atlanta, Miami & Seattle

The Transportation Security Administration is continuing to rollout Phase One Deployment of the Certified Cargo Screening Program (CCSP) which was launched in January 2008 in San Francisco, Philadelphia, and Chicago. Additionally, forums have recently been conducted in the Los Angeles, Dallas, and New York/Newark areas.

TSA is preparing to launch the third round of outreach to the next three cities: Seattle (SEA) – May 8th, 2008, Atlanta (ATL) – May 6th, 2008, and Miami (MIA) – May 5th, 2008. For this third round of outreach activities, TSA will be conducting industry forums in each of the three metropolitan areas and would like to invite Air-Sea Forwarders shippers and business partners to attend, if you have operations or move air cargo out of one of these cities.

Forums will provide participants with information about the 100% screening mandate, the Certified Cargo Screening Program, and details on how facilities may join Phase One of the program. They will allow ample time for questions and discussion.

The CCSP will allow TSA-vetted shipping facilities to conduct physical screening processes in addition to utilizing various technologies, to screen cargo.

Shippers and business partners of Air-Sea Forwarders, may sign up for the forums in Seattle, Atlanta, or Miami using the link below. Please note that the TSA has advised us that space is limited.

TSA RSVP

Thank you
Air-Sea Forwarders, Inc.

 TACA Announces the Latest BAF and CAF Adjustments

The Trans-Atlantic Conference Agreement (TACA) announces that the BAF will remain unchanged until at least June 15th, 2008. Below are the current levels:

To, From and Via – Atlantic/Gulf Coast Ports:

$607.00 per 20ft container
$1214.00 per 40/45ft container
$61.00 Weight or Measure

To, From and Via – Pacific Coast Ports

$911.00 per 20ft container
$1822.00 per 40/45ft container
$91.00 Weight or Measure

TACA has also advised that the Currency Adjustment Factor (CAF) will be adjusted from 12% to 15%, effective May 16th, 2008, until at least June 15th, 2008.

Below are the lines associated with TACA:

Atlantic Container Line A.B.
Maersk Line
Mediterranean Shipping Co.
Nippon Yusen Kaisha (NYK) Line
Orient Overseas Container Line

Source: The Transatlantic Conference Agreement

 French Corporation pleads guilty for illegal exports to Iran

A French corporation, headquartered in Hesingue, France, has pleaded guilty to conspiracy, illegal exports, and attempted illegal export of cryogenic submersible pumps to Iran, U.S. Attorney Jeffrey A. Taylor and Assistant Secretary of Commerce for Export Enforcement Darryl W. Jackson announced today.

The company pled guilty earlier today before the Honorable Colleen Kollar-Kotelly of the U.S. District Court for the District of Columbia to one count of Conspiracy, one count of Export without an Export License, and one count of Attempted Export without an Export License. Pursuant to a written plea agreement, the French company must be sentenced to a criminal fine of $500,000 and corporate probation of two years when the company is sentenced by Judge Kollar-Kotelly on July 17, 2008.

“Foreign parties that choose to export U.S.-origin goods to embargoed destinations, such as Iran, violate our export control laws,” said Assistant Secretary Jackson. “As this case demonstrates, we will vigorously pursue such violations.”

“Export restrictions should not be viewed as avoidable obstacles, but rather as fundamental safeguards for the protection of our national interests,” stated U.S. Attorney Taylor. “This prosecution should serve as a reminder that failure to comply with U.S. export control laws can have severe consequences.”

The evidence in this case established that the French company, with business locations around the world including in the United States, specialized in the design and manufacturing of cryogenic equipment, such as pumps, turbines, compressors and automatic filling stations that were used to transport and process natural gases at extremely cold temperatures. A Delaware corporation with its principal place of business in Nevada, engaged in the business of designing and manufacturing cryogenic pumps for various uses, including for pumping fluid hydrocarbons that have been cooled to cryogenic temperatures (280 degrees below zero). The Delaware company specialized in the design and manufacturing of cryogenic equipment, such as pumps, turbines, compressors and automatic filling stations that were used to transport and process natural gases at extremely cold temperatures.

In 2001, another French company with a U.S. subsidiary arranged to purchase cryogenic submersible pumps from the Delaware company for delivery to an Iranian company for installation at the 9th and 10th Olefin Petrochemical Complexes in Iran. The French company named in the suit, agreed to facilitate this transaction by serving as the middleman for another French company and the Delaware company, by purchasing the pumps from the Delaware company, by reselling them to another French company (which forwarded the pumps to Iran), and by falsely indicating that the final purchaser was a French company that would install the pumps in France, when all parties to the transaction knew that the ultimate and intended destination of the pumps was Iran.

The conspirators developed a plan to conceal the export of cryogenic pumps to Iran, under which the Delaware company would sell and export the pumps to the French company in France, which would then resell the pumps to another French company, with the ultimate and intended destination being Iran. The conspirators set forth the plan on a “matrix,” which they used as a roadmap, including various procedures to be followed by each company to protect their conduct from detection by United States law enforcement.

Following the procedures set forth in the “matrix,” the conspirators manufactured four pumps, and shipped them, in January 2003, for installation at the 9th Olefin Petrochemical Complex in Iran, (“First French Company Order”). The total value of the First Order was approximately $746,756.

The conspirators prepared three additional pumps to be shipped to Iran in the fall of 2003, for installation at the 10th Olefin Petrochemical Complex in Iran (“Second French company Order”). The total value of the Second Order was approximately $1,125,055. The conspirators halted shipment of the Second Order because of this investigation.

The conspirators attempted to cover up their illegal conduct by creating false correspondence confirming that none of the pumps were sent, or were intended to be sent, to Iran. None of the conspirators sought and obtained export licenses for either the First Order or the Second Order.

The Delaware company and its former president pled guilty and were sentenced at an earlier stage in this investigation. The French company’s guilty plea is the result of an investigation by the U.S. Department of Commerce, Bureau of Industry and Security.

Source: U.S. Department of Justice

 TSA Unveils Certified Cargo Screening Program

Following on the recommendations of the 9/11 Commission Act of 2007, the Transportation Security Administration (TSA) has created the Certified Cargo Screening Program (CCSP). The 9/11 Act calls for 50% of all cargo transported onboard a passenger aircraft to be screened by February 2009, and 100% of all cargo onboard passenger aircraft to be screened by August 2010.

To meet this requirement the TSA has unveiled the CCSP program with the hope that Certified Cargo Screening Facilities (CCSF) can accept the burden of cargo screening. The program is entirely voluntary, and is available to all U.S. shippers and freight forwarders.

Air-Sea Forwarders, Inc. encourages our clients to consider joining this program. If you are interested, please contact your local Air-Sea Forwarders office. Alternatively you may send an e-mail directly to our sales department, by clicking our 60th anniversary link below. Please entitle the subject of your e-mail “TSA CCSP”.

 Temporary Denial Order Issued for Export of U.S. Aircraft to Iran

The U.S. Commerce Department’s Bureau of Industry and Security (BIS) today issued a Temporary Denial Order (TDO) suspending the export privileges of two airlines and their parent company for 180 days. Evidence obtained by BIS shows that the respondent parties knowingly reexported three U.S. origin aircraft to Iran in violation of the Export Administration Regulations (“EAR”), and are preparing to reexport three additional U.S. origin aircraft to Iran in further violation of the EAR.

In addition, false statements were made to BIS regarding the ultimate destination and end-user of the aircraft. BIS has ordered the redelivery to the U.S. of the three aircraft about to be reexported to Iran, but the airlines have not complied and have indicated that they will not cooperate. The airlines are based in the U.K., Armenia, and Iran.

Source: Bureau of Industry & Security

 Port of Los Angeles Proposes Clean Truck Program

The Port of Los Angeles today posted its final recommendations for a Port of Los Angeles Clean Truck Program (CTP) designed to achieve long-term sustainability, accelerate the replacement of high-polluting trucks with cleaner trucks, and provide market incentives to encourage private investment and create a capitalized, asset-based short-haul trucking or “drayage” system at the nation’s largest container port. The Los Angeles Harbor Commission will consider the proposed Clean Truck Program recommendations at its March 20, 2008, special board meeting, 9:00 a.m. at Banning’s Landing Community Center in Wilmington.

Pollution from the truck fleet serving the San Pedro Bay ports contributes to hundreds of premature deaths annually in Southern California, with the public paying between $100 million and $590 million annually in health impact costs alone, according to the California Air Resources Board. The present system of Licensed Motor Carriers (LMCs) and lowwage, paid-by-the-load independent truck owner-operators (IOOs) provides no incentive for improving efficiency and no financial means to replace the existing truck fleet with cleaner, more efficient trucks.

“The trucking system serving our ports is broken and cannot be permanently fixed without a major transformation,” said Port of Los Angeles Executive Director Geraldine Knatz, Ph.D. “Our Clean Truck Program offers incentives that will help us reach the 80-percent truck pollution reduction target as quickly as possible, encourage participation from legitimate outside operators, and provide the most sustainable long-term solution for protecting public health and safety. If we don’t create a responsible and financially viable port trucking system, a decade from now we’ll be throwing billions of dollars at this chronic problem once again.”

The Port’s CTP is designed to encourage an evolution of the Port drayage market towards an asset-based system in which LMCs enter into drayage concession agreements with the Port and are responsible for owning and maintaining the truck assets used to perform drayage services at the Port under the concession. Port of Los Angeles drayage concessionaires must also commit to using employee drivers for Port drayage by year 2012 through a phased-in schedule, with flexibility afforded for peaks and troughs in demand by use of temporary or part-time employees. By working with a concessionaire network of LMCs that have direct control over employee drivers, the Port can more effectively ensure that concessionaires meet requirements that include having a legitimate place of business and proof of adequate off-street parking. These requirements will reduce the impact of trucks driving into communities and parking in front of home or businesses, especially in the Harbor District.

As operators with a vested interest in their truck assets, Port of Los Angeles concessionaires will be more accountable for proper truck maintenance and safety standards, so their trucks will continue to generate lower emissions and retain maximum value over the long haul. Concessionaires also will have more incentive to pursue business efficiencies that are common within the trucking industry, like operating fewer trucks to accomplish the same number of container hauls – one of the easiest ways to reduce pollution and truck congestion.

The drayage system proposed in the Port of Los Angeles Clean Truck Program more closely resembles the nationwide non-drayage trucking industry, where capitalized, assetbased trucking companies use employee drivers and pay higher wages in order to recruit and retain truck drivers. With owner-operators in the present port drayage earning $10 to $12 per hour on average after fuel and necessary truck maintenance costs, truck drivers elsewhere earning $20 per hour or more have no incentive to work in port trucking.

According to a drayage options analysis performed by The Boston Consulting Group (BCG), the current drayage system imposes between $500 million and $1.7 billion of costs on the public each year through: operational inefficiencies (e.g. impact on truckers and trucking companies of truck under-utilization, traffic congestion and lack of driver health/benefits); city/community costs (e.g. road maintenance, environmental damage, vehicle and driving safety and residential impacts from truck traffic and parking); and, above all, public health (premature death, hospital admissions, workday and school-day loss, and restricted activity).

By all accounts, the cost of replacing the present truck fleet will raise the price shippers pay to move their cargo through the San Pedro Bay ports. But at an incremental cost of $500 million over a non-asset and employee-based drayage model, the additional cost of the Port of Los Angeles’ proposed system is less than the externalized, public-borne costs ($500 million to $1.7 billion annually) that are offset by a transformed drayage market. According to BCG’s analysis the proposed employee based system should deliver a positive cost: benefit ratio from 2010 onwards.

In November 2007, the Los Angeles and Long Beach Boards of Harbor Commissioners approved a progressive dirty truck ban schedule which begins October 1, 2008 by prohibiting all pre-1989 trucks from working in port drayage. By January 1, 2012, all drayage trucks operating in the port complex will be required to meet 2007 federal emission standards, which will reduce port related truck pollution by an estimated 80 percent. In December 2007, both port commissions approved cargo fee tariffs to accelerate the replacement of the existing truck fleet by assessing a $35 gate fee per twenty-foot container unit (TEU) to generate funds to help underwrite the replacement of the existing truck fleet.

The Port of Los Angeles Clean Truck Program is designed to be consistent with the recently approved Port of Long Beach Clean Trucks Program in terms of the truck ban schedule. At the Thursday Commission meeting, the Port will recommended revision of the start date for the collection of the Clean Trucks cargo fee to October 1, 2008, in order to align implementation dates with the Port of Long Beach’s clean truck initiative and allow more time for distribution of radio-frequency tags and reader installation at terminal gates.

The Port of Los Angeles Clean Truck Program includes the following provisions:

Cargo Fee Exemptions
1) All privately funded 2007 compliant trucks – including retrofits, LNG, electric, alternative fuel or other acceptable “best technology” vehicles (e.g. hybrid or hydrogen) -- will be exempted from the $35 per twenty-foot container (TEU) Clean Trucks Fee at Port of Los Angeles terminals.
2) Concessionaires with privately funded 2007 compliant trucks will not be required to turn in an old truck to scrap as part of their permit agreement.
3) All publicly funded LNG, electric, alternative fuel or other acceptable “best technology” vehicles will be exempted from the Clean Trucks Fee ($35 per twenty-foot container) at Port of Los Angeles terminals.
4) No exemption will be given to publicly-funded 2007 compliant diesel trucks or retrofits.
5) Port of Los Angeles Clean Truck Program-funded trucks will require a truck trade-in for scrapping and must become a regular use drayage vehicle (an averaged minimum of six trips per week).

Concession Requirements
1) Concessions will only be provided to Licensed Motor Carriers, not individual truck owner-operators.
2) Concessionaires will pay a $2,500 fee for a five-year permit plus an annual fee of $100 per truck.
3) All drivers of trucks being used to carry out a concession (i.e., trucks accessing port property) must be employees of the concessionaire upon the completion of a five-year transition period.
4) Concessions may be revoked at any time if the Concessionaire is not compliant with the requirements for licensing, bonding, insurance, maintenance, safety or security.
5) Concessionaires must agree to meet port standards for technology and efficiency (promoting the use of current or future tools like the virtual container yard).

Financing
1) Financing will be provided to Concessionaires only, providing grants for up to 80 percent of the purchase of 2007 standard diesel and LNG trucks
2) Low cost leasing options will be provided.
3) Retrofits meeting 2007 emissions standards also will be funded in full.
4) CTP financed or leased trucks must be used as full time drayage vehicles (average minimum of six trips per week)
5) CTP trucks must meet CTP specifications, and must be purchased from a CTP authorized vendor

By offering a broader range of Clean Truck Fee exemptions, the Port of Los Angeles Clean Truck Program will encourage more rapid investment in 2007-compliant trucks. In addition, the requirement of turning in an old truck to be scrapped will be limited only to concessionaires who receive CTP funding assistance in purchasing 2007 diesel trucks. The Port also will create a Scrap Truck Buyback Program to help accelerate the removal of pre-1989 trucks from Port service, paying parties $5,000 to turn in their pre-1989 trucks. Concessionaires who receive CTP-funding are not eligible for the $5,000 Scrap Truck Buyback.

The Port also will offer a Truck Procurement Assistance Program for concessionaires who apply for truck funding in order to obtain the best possible truck prices through volume discount pricing agreements the Port will forge with approved Original Equipment Manufacturers (OEMs) and associated dealers – either independently or with the Port of Long Beach. Through this program the Port will identify a range of trucks with appropriate emissions reduction capabilities at discounted prices and make this range of options available to CTP program participants.

To assist Concessionaires in the transition over to an employee-based industry, the Port also will create a Business Outreach Program that will provide seminars to educate concessionaires on best practices in the areas of Program compliance, operational efficiency, financial management and human resources guidelines for transitioning to employees. The Business Outreach Program will also offer driver training courses and truck maintenance options. It will be open to any Port of Los Angeles concessionaire, with a preference for financing given to concessionaires with a history of drayage work.

Source: The Port of Los Angeles

 BIS Announces Changes to License Exception Reporting Requirements

Effective April 28th, 2008 Automated Export System (AES) reporting requirements for license exceptions administered by the Bureau of Industry and Security (BIS) under the Export Administration Regulations (EAR) will change.

The Export Classification Control Number (ECCN) will be required for license exceptions reportable under the following license codes:

TSR, RPL, GOV, GFT, TSU, BAG, AVS, APR, KMI, TAPS, and ENC

Air-Sea Forwarders has already taken the necessary programming steps within our software, and we expect no transmission problems concerning this new change.

Exporters are reminded that without a valid ECCN, an AES transmission cannot take place. As a result, failure to supply and ECCN with one of the above license exception codes will cause a shipping delay.

Please refer any questions you may have to your local Air-Sea Forwarders branch office. Alternatively you may also call our corporate headquarters and ask to speak with the compliance officer.

 TACA Announces the Latest BAF and CAF Adjustments

The Trans-Atlantic Conference Agreement (TACA) announces that the BAF will remain unchanged until at least May 15th, 2008. Below are the current levels:

To, From and Via – Atlantic/Gulf Coast Ports:

$607.00 per 20ft container
$1214.00 per 40/45ft container
$61.00 Weight or Measure

To, From and Via – Pacific Coast Ports

$911.00 per 20ft container
$1822.00 per 40/45ft container
$91.00 Weight or Measure

TACA has also advised that the Currency Adjustment Factor (CAF) will also remain unchanged until at least May 15th, 2008. The current CAF is 12%.

Below are the lines associated with TACA:

Atlantic Container Line A.B.
Maersk Line
Mediterranean Shipping Co.
Nippon Yusen Kaisha (NYK) Line
Orient Overseas Container Line

Source: The Transatlantic Conference Agreement

 Man Pleads Guilty to Export Enforcement Violations

U. S. Attorney Jim Letten announced today the unsealing of a case in which a resident of Rio de Janeiro, Brazil, who also maintains United States citizenship, pleaded guilty on August 2, 2007, to an indictment charging him with conspiracy to violate the International Emergency Economic Powers Act and the Iranian Transactions Regulations. The indictment was filed on June 7, 2007 and recently unsealed by the Court and the defendants is scheduled to be sentenced on May 22, 2008.

According to court documents, the defendant is a director of a Brazilian consulting engineering firm which acted as an agent for a U.S. engineering company located in Kenner, Louisiana that designed, produced, marketed, and supported Structural Analytical Computer Software (SACS), an engineering software program intended to assist in the design of offshore oil and gas structures. Beginning around March, 1995, and continuing through February, 2007, the defendant, acting as an agent for the U.S. firm, marketed and serviced SACS and trained users of the software in Iran. Since SACS is a controlled product under various United States laws and regulations due to the product’s sophistication and its potential use, the defendant's actions violated the International Emergency Economic Powers Act and the Iranian Transactions Regulations by exporting and attempting to export the SACS engineering software program to Iran without having first obtained the required authorizations from the Office of Foreign Assets Control.

The defendant faces a maximum term of imprisonment of five (5) years, a fine of $250,000.00 and three (3) years of supervised release following any term of imprisonment.

The case was investigated by agents of U. S. Immigration and Customs Enforcement, the Department of Commerce, and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Michael W. Magner and Gregory Kennedy.

Source: U.S. Department of Justice

 Commission Promotes Alternative-fuel Trucks

To spur clean air innovations, the Long Beach Board of Harbor Commissioners has amended its groundbreaking Clean Trucks fleet modernization program, adding provisions to encourage harbor truck operators to use to low-emission, alternative-fuel trucks.

In approving the Clean Trucks Program on Tuesday, February 19, the Port of Long Beach Commission set in motion a plan that will slash truck emissions by 80 percent over the next four years, financed in part by a fee of $35 per twenty-foot equivalent container unit (TEU). Also on Tuesday, the board went a step further, voting to require that no less than 50 percent of the Clean Trucks Program-financed trucks run on alternative fuels proven to be cleaner than diesel, such as liquefied natural gas (LNG). The board also instructed staff to monitor manufacturing capacity and to report back periodically.

With a projected $1.6 billion from the Clean Trucks Fee, the Clean Trucks Program will offer significant subsidies to finance the replacement of thousands of trucks that serve Port of Long Beach terminals. At the same time, to encourage truck owners to invest and replace their vehicles on their own, without the assistance of Port financing, the Commission approved exemptions or partial exemptions from the Clean Trucks Fee.

Cargo hauled by alternatively fueled trucks acquired without Clean Trucks Program financing will be completely exempt from the $35 per TEU fee, regardless of when the truck was purchased. Meanwhile, cargo hauled by clean diesel trucks – which meet the 2007 federal emission standards or better and were acquired without Clean Trucks Program financing – will have to pay only half the Clean Trucks Fee – also regardless of when the truck was purchased.

"With these exemptions, the Clean Trucks Program will help start reducing emissions immediately," said Harbor Commission President Mario Cordero. "The exemptions will not only encourage the use of alternative fuels, but they will also provide truck owners an incentive to act early to replace aging, dirty trucks."

With the Clean Trucks Program, the Port will replace 16,800 drayage trucks by 2012, beginning with a ban on the oldest, polluting trucks and collection of the Clean Trucks Fee on October 1, 2008.

Source: Port of Long Beach

 Long Beach Approves Clean Trucks Plan

In a victory for clean air, the Long Beach Board of Harbor Commissioners voted Tuesday, February 19, 2008, to approve key elements of a landmark Clean Trucks Program that will replace and modernize the entire port trucking fleet to slash truck-related air pollution by 80 percent within four years.

After listening to testimony for more than five hours, the Port of Long Beach Commissioners voted unanimously to adopt a truck concession requirement that will help identify "clean" trucks, ensure reliable short-haul ("drayage") service, and improve air quality, security and safety. Only "clean" concession trucks will be allowed to work at the Port of Long Beach.

Fact Sheet; Video

The concession requirement allows employee drivers, independent contractor drivers or a combination of employee and contractor drivers to work the Port -- as they do now. But for the first time, the port trucking industry will be required to meet clean truck, maintenance, security and health insurance requirements. Commissioners also finalized a $2 billion subsidy program to finance the lease or purchase of clean trucks.

"Today, the Port has taken a monumental step to improve air quality and protect the health of the entire community," said Mario Cordero, President of the Long Beach Board of Harbor Commissioners. "We have worked closely with many community, environmental and business groups, and this plan incorporates their strongest ideas. This the most ambitious, far-reaching clean-air plan ever undertaken by any seaport."

The Commissioners on Tuesday also adopted several other elements of the Clean Trucks Program:

1) A revision of the start date for the collection of the Clean Trucks cargo fee to October 1, 2008, to allow time for distribution of radio-frequency identification tags and reader installation.

2) Linkage of the Clean Trucks $35 per twenty-foot container unit (TEU) cargo fee and the Port's $15 per TEU infrastructure cargo fee. This change will ensure that the dirty trucks are cleaned up before new infrastructure is built with cargo fee dollars.

3) An exemption or partial exemption on the Clean Truck cargo fee for cargo owners who use clean trucks acquired without financing from the Port.

The concessions require Licensed Motor Carriers (LMCs) register their drivers and trucks with the Port, and tag their vehicles with radio-frequency identification devices so the Port can monitor compliance. The LMCs will be required to meet clean truck, security, maintenance and health insurance requirements. The Port will soon announce details on registration.

The elements approved February 19 are key pieces of a sweeping program that has been systematically adopted through several Board votes. In November 2007, the Long Beach and Los Angeles Boards of Harbor Commissioners approved a ban on pre-1989 trucks beginning October 1, 2008. By January 1, 2010, only trucks built after 1993 will be allowed into port shipping terminals, and by January 1, 2012 all trucks must meet 2007 federal emission standards that make new trucks more than 80 percent less polluting than older trucks.

In December 2007, the Commissions approved the cargo fee to accelerate the replacement of the drayage fleet that serves the Port. The fee will end when the fleet of drayage trucks meets Clean Air Action Plan (CAAP) requirements in about 2012. The Port will use the funds to help drivers get new cleaner trucks and ensure that the old, polluting trucks will be scrapped and taken out of circulation, rather than continue to work outside the ports.

While the Port does not own or operate the more than 16,000 drayage trucks that serve Port terminals, the Clean Trucks Program will greatly accelerate the reduction of air pollution and public health risks posed by dirty diesel trucks that would otherwise remain on the roadways for many years if not decades.

Source: Port of Long Beach

 Recent Export Enforcement Cases – December 2007 to January 2008

Petrochemical Valves to Iran and Iraq - On December 17, 2007, a U.S. citizen was sentenced to serve 17 months in prison followed by two years’ of probation and to pay a $10,000 criminal fine for his part in a conspiracy to export U.S. origin valves to Iran via Australia. On August 15, 2007, he was convicted at trial of one count of aiding and abetting. On October 15, 2007, a 2nd U.S. citizen, for the company located in Signal Hill, California, was sentenced to serve three years’ probation, six months of home detention, and to pay a $5,000 criminal fine for her role in the export of petrochemical valves to Iran and Iraq through Australia in order to evade the Export Administration Regulations. The Signal Hill company filed a Voluntary Self-Disclosure with BIS when they discovered that employees had orchestrated a diversion through Australia. The company cooperated with OEE Special Agents during the investigation. The 2nd U.S. citizen pled guilty in January 2007, to one count of shipping valves to Iran and one count of shipping valves to Iraq.

Exports of Night Vision to Various Locations - On January 22, 2008, a Vandalia, Missouri company was sentenced in U.S. District Court in the Eastern District of Missouri to two years’ probation, a $17,500 fine, and $800 special assessment for violations of export controls. On November 2, 2007, the company pled guilty to one count of violating the IEEPA and one count of violating ITAR. The charges are the result of an investigation that identified approximately 66 illegal exports in violation of IEEPA and eight illegal exports in violation of ITAR between 2002 and 2006. The company is a wholesale distributor of hunting and camping equipment to include restraint devices, shotgun barrels, global positioning systems, firearm scopes and sights, and other items controlled for export. OEE and ICE jointly conducted this investigation.

Source: Department of Commerce, Bureau of Industry and Security

 GAO asked to Review Implementation of New Air Cargo Screening Requirements

New Requirements for 100% Screening of Cargo on Passenger Planes Passed into Law Last Year

Homeland Security Committee Chairman Bennie G. Thompson (D-MS) and Representative Edward J. Markey (D-MA) today asked the Government Accountability Office (GAO) to fully review the Transportation Security Administration’s implementation of a new requirement for 100% screening of air cargo on passenger planes. Congress’s first act in the 110th Congress was to implement outstanding 9/11 Commission recommendations, which included a requirement to screen 100% of air cargo carried on passenger planes by 2010.

“Congress mandated 100% screening of air cargo on passenger planes to close known security weaknesses and our work continues to ensure that TSA is held accountable for implementing the intent of Congress,” said Rep. Thompson. “Only a comprehensive review can assure us, as the Congressional oversight committee, that TSA’s cargo screening program will address systemic weaknesses that have kept us all vulnerable.”

Rep. Markey said, “Last year we achieved a major homeland security victory by changing the law to screen all cargo carried on passenger planes. TSA is in the early stages of developing a system to comply with these new mandates. The GAO’s review will help Congress ensure that TSA’s system will meet the strong security safeguards required in the new law that are needed to protect airline passengers and crew members.”

Specifically, Reps. Thompson and Markey’s request asks the GAO to examine TSA plans for ensuring that the 100% screening mandate is fulfilled “in a manner consistent with Congressional intent.” The law defines screening to mean a physical examination or non-intrusive method (e.g., through the use of x-ray systems and TSA-certified canine teams) as well as additional methods, to ensure that the cargo does not pose a threat to transportation security. The request also asks GAO to review several other questions, including:

To what extent is TSA’s approach to meeting the law’s air cargo mandates designed to provide a level of security for air cargo screening that is “commensurate with the level of security for the screening of passenger checked baggage”, as required by the Act?

What challenges, if any, does TSA face in meeting the legislative mandates within the timelines set forth in the Act?

Please identify the milestones and estimated costs associated with meeting the requirement of screening 100 percent of air cargo, as established by TSA and the Department of Homeland Security.

Source: U.S. House of Representatives – Committee on Homeland Security

 Value of CBP, ICE Seizures of Counterfeit Goods Rises 27%

The U.S. Department of Homeland Security (DHS) announced today it had seized counterfeit or pirated merchandize worth approximately $200 million in domestic value for fiscal year (FY) 2007. This year's activities continue a significant upward trend in the value of seizures, exceeding the value of last year’s by 27 percent.

The domestic value of the goods is determined by adding the cost of manufacturing goods in a foreign country to the costs of shipping, insurance and customs duties to enter the United States and, therefore, is lower than the manufacturer’s suggested retail price.

The departments of U.S. Customs and Border Protection (CBP) and U.S. Immigration and Customs Enforcement (ICE), components of DHS, made over 13,600 seizures last year. ICE investigations in FY 2007 resulted in 241 arrests, 149 indictments and 134 convictions on intellectual property rights violations.

"These criminal organizations are not only stealing the trademarks of U.S. businesses, they are siphoning millions of dollars from the American economy and are often deceiving an unsuspecting public," said Julie L. Myers, Assistant Secretary for Immigration and Customs Enforcement. “These results show that ICE has made protection of U.S. intellectual property rights our trademark."

"Where there is money to be made, counterfeiters and pirates will steal intellectual property and capitalize on the innovations of others without regard for the consequences to the people and to the businesses that they steal from or the consumers that are harmed by their fake products," said W. Ralph Basham, Commissioner, U.S. Customs and Border Protection. "CBP is committed to stopping trade in pirated and counterfeit goods and is taking action to confront the growing global theft of intellectual property."

DHS is countering the growing trade in counterfeit commodities that adversely impacts the American economy and may pose health and safety risks to consumers. Although the top commodity seized in FY 2007 continued to be footwear – with a domestic value of $77.7 million, which accounted for 40 percent of the entire value of goods seized – counterfeiters use the same methods to bring in fake pharmaceuticals, electrical items, food and hygiene products that threaten the health and safety of consumers as well as their pocketbooks.

Major cases executed in FY2007 included:

1) In September 2007, CBP officers in Anchorage, Alaska, targeted a shipment from China manifested as "samples". When officers opened the box, they discovered 1,460 counterfeit "IDT" ("Integrated Device Technology") integrated circuits. Integrated Circuits (ICs) are used in a wide range of applications, including automobiles, appliances, computers, telecommunications, medical devices, and consumer electronics. Counterfeit ICs can create reliability problems in end-products.

2) On Aug. 1, 2007, ICE agents from 22 offices assisted by representatives of the electronic industry executed 32 federal search warrants in 16 states as part of an investigation into the alleged sale and distribution of illegal modification chips and disc copyright circumvention devices. This investigation represents the largest national enforcement action of its kind targeting this type of illegal activity. The search warrants were executed at businesses, storefronts and residences associated with subjects who are allegedly involved in the direct importation, installation, sale and distribution of the devices that are of foreign manufacture and smuggled into the United States. The chips and devices allow users to play illegally obtained, pirated and/or counterfeit software on video game consoles by Microsoft, Nintendo and Sony. The names of those targeted and case specifics are not releasable at this time.

3) In July 2007, CBP officers at the Los Angeles Seaport seized a shipment of counterfeit Nike footwear. Counterfeiters attempted to smuggle the 21,492 pairs of fake Nike shoes by describing the merchandise as furniture.

4) In July 2007, CBP officers in Newark seized 20,208 bottles of counterfeit Ralph Lauren perfume. The counterfeiters attempted to smuggle in the perfume by concealing it in the nose of the container. This counterfeit perfume could have potentially contained harmful bacteria.

5) In late June 2007, 29 defendants were charged in three separate complaints with conspiracy to smuggle over 950 shipments of merchandise into the United States, principally from China - through ports of entry at Newark, N.J., Houston, Tex., Long Beach, Calif., New York Container Terminal in Staten Island, N.Y. and John F. Kennedy International Airport - and/or conspiracy to traffic in counterfeit goods. Four of the defendants were also charged with money laundering. The charges are the result of a 19-month coordinated initiative by agents of ICE and CBP. The investigative techniques employed by ICE and CBP included the use of cooperating witnesses, undercover agents and video and audio surveillance. During the course of their investigation, officers seized counterfeit merchandise which, had it been authentic, ICE and CBP estimate would have had a manufacturer’s suggested retail price of approximately $700 million.

6) In May 2007, CBP officers in Newark seized 144,000 tubes of counterfeit Colgate toothpaste. Some of the toothpaste in the shipment contained a toxic chemical found in antifreeze and posed a serious health and safety risk to the buying public.

In recent years, counterfeiting, piracy and other intellectual property rights violations have grown in magnitude and complexity, costing U.S. businesses billions of dollars in lost revenue and often posing health and safety risks to U.S. consumers. The growth in IPR violations has been fueled in part by the spread of enabling technology allowing for simple and low-cost duplication of copyrighted products, as well as by the rise in organized crime groups that smuggle and distribute counterfeit merchandise for profit. In many cases, international organized crime groups use the profits from the sale of counterfeit goods to bankroll other criminal activities, such as the trafficking in illegal drugs, weapons, and other contraband.

As the primary agency responsible for U.S. border enforcement, CBP is a key player in IPR enforcement. CBP’s new methods focus on improving risk analysis to enhance the capability to target and interdict shipments of fake goods while facilitating the flow of trade in legitimate goods; identifying business practices linked to importing counterfeit goods and working with companies to change those practices; using audits to deprive counterfeiters and pirates of their profits; working with right holders to protect their rights at our borders; and cooperating with other government agencies, customs administrations and international organizations to strengthen IPR enforcement.

As the largest investigative arm of the Department of Homeland Security, ICE plays a leading role in targeting criminal organizations responsible for producing, smuggling, and distributing counterfeit products. ICE investigations focus not only on keeping counterfeit products off U.S. streets, but also on dismantling the criminal organizations behind this activity. ICE manages the National Intellectual Property Rights Coordination Center, which coordinates the U.S. government's domestic and international law enforcement attack on IPR violations. ICE agents and CBP personnel throughout the country rely upon the IPR Coordination Center for guidance in their inspections and investigations.

ICE and CBP will continue to work vigorously to pursue IPR violations.

Source: U.S. Customs and Border Protection

 DHS Agencies Announce Enrollment Dates for TWIC in 13 Ports

The Department of Homeland Security (DHS) today announced that enrollment in the Transportation Worker Identification Credential (TWIC) program will begin at 13 more locations in the coming weeks. This program ensures that any individual who has unescorted access to secure areas of port facilities and vessels has received a thorough background check and is not a known security threat.

TWIC enrollment began Oct. 16, 2007 at the Port of Wilmington, Del. The addition of these 13 locations will bring the number of fixed enrollment centers open for enrollment to 72. Ultimately, the program will be rolled out to 147 fixed enrollment sites and will vet more than 1 million workers through 2008.

"TWIC is one of the world's most advanced interoperable biometric systems and raises the bar on port security," said the Transportation Security Administration's (TSA) Maurine Fanguy, program director for TWIC. "We are off to a strong start with more than 50,000 enrollments in the first 100 days."

Today, the TSA released specific dates for the following ports:

Vicksburg, Miss. / Jan 31, 2008
Muskegon, Mich. / Jan 31, 2008
Miami, Fla. / Jan 31, 2008
Ashtabula, Ohio / Feb 6, 2008
Everett, Wash. / Feb 6, 2008
Louisville, Ky. / Feb 6, 2008
Nashville, Tenn. / Feb 8, 2008
Oswego, N.Y. / Feb 8, 2008
Port Everglades, Fla. / Feb 8, 2008
LaPlata, Md. / Feb 13, 2008
Portland, Maine / Feb 13, 2008
Lorain, Ohio / Feb 20, 2008
Sault Ste. Marie, Mich. / Feb 21, 2008

Workers at these ports, as well as another 59 where enrollment has begun, are able to pre-enroll for TWIC on the TSA Web site “(www.tsa.gov/twic).” Pre-enrollment is intended to speed up the process by allowing workers to provide biographic information and schedule an appointment to complete the in-person enrollment process.

Source: Transportation Security Administration

 President Bush Issues Export Controls Directive

President Bush issued an Export Control Directive today that will ensure that U.S. defense trade policies and practices better support the National Security Strategy of the United States. The package of reforms required under this directive will improve the manner in which the U.S. Department of State licenses the export of defense equipment, services and technical data, enabling the U.S. Government to respond more expeditiously to the military equipment needs of our friends, allies, and particularly our coalition partners.

The Export Control Directive mandates the commitment of additional financial and other resources, as well as procedural reforms, that will expedite the processing of export license applications for items controlled by the U.S. Munitions List. Although license processing times will be reduced as a result of this directive, the Administration is committed to ensuring that existing measures to prevent the diversion of such items to unauthorized recipients remain strong and effective.

The specific actions directed by the President include:

More Effective U.S. Export Licensing

1) Additional financial resources and intelligence support will be made available for the timely adjudication of defense trade licenses.

2) Guidelines will be issued that require a decision by the U.S. Government on defense trade export license applications within 60 days, absent a strong reason for additional time, such as a requirement for Congressional notification. Initial efforts in this regard have resulted in a nearly 50 percent reduction since April 2007 in the number of export license applications pending with the Department of State.

3) The electronic licensing system will be upgraded to permit the submission of all types of defense trade licenses and to enable all agencies to access the same electronic information.

4) The Secretary of State will update U.S. controls on exports involving dual and third country nationals from NATO and other allied countries.

A More Efficient Dispute Resolution Mechanism

A formal interagency dispute mechanism will be created to allow for timely resolution of licensing jurisdiction issues involving the Departments of State and Commerce under the Commodity Jurisdiction (CJ) process. The National Security Council will also undertake a review to make sure the CJ process is efficient and timely.

Enhanced Enforcement

A multi-agency working group will be established to improve procedures for conducting export enforcement investigations.

The directive reflects consensus recommendations from the National Security Council and the Departments of State and Defense. The Bush Administration is committed to working closely with U.S. industry to implement these reforms.

Source: U.S. Department of State

 Yet another container tax: Long Beach/Los Angeles Ports Approve Container Fee

The Long Beach and Los Angeles Boards of Harbor Commissioners on Monday, January 14, 2008, in a joint meeting, approved a cargo fee that will generate $1.4 billion for transportation projects to improve traffic flow and air quality in the harbor area. The fee is in addition to one enacted in December to help fund the ports’ Clean Trucks Program.

The transportation infrastructure funding will be used for bridge, railway and road improvements used in port-related goods movement, including replacement of the Gerald Desmond and Heim bridges, freeway connector improvements, and port-area rail enhancements, which reduce the need for local truck trips.

Funds generated by the infrastructure cargo fee will be used to match Proposition 1B funds, which California voters approved in 2006 to help pay for major transportation and air quality improvement projects. Together, the cargo fee and Proposition 1B funds will finance about $3 billion in improvements.

"These infrastructure improvements will deliver major benefits to the community in improved traffic flow and reduced air pollution," said Long Beach Port Executive Director Richard D. Steinke. "Importantly, they will also help support the economy and jobs by ensuring the continued efficient movement of cargo."

"Proceeds from this tariff will help make our bridges safer, improve highway safety and congestion, and shift more containers from trucks to on-dock rail," added Port of Los Angeles Executive Director Geraldine Knatz Ph.D. "It also generates local dollars to help our ports obtain additional state and federal funding for infrastructure and air quality projects."

The proposed fee will be assessed on every loaded 20-foot equivalent (TEU) cargo container entering or leaving any terminal by truck or train beginning January 1, 2009. The amount will fluctuate based on the current funding needs of approved projects. It is anticipated that the charge would be $15 per loaded TEU for seven years, but could vary depending on availability of public funds and timing of environmental approvals.

Funds from the proposed fee program will be used only for approved local projects. Spending will be limited to specific projects after project approval by the applicable lead agency and fee collection will stop when those projects are completed.

Cargo fee revenue and Proposition 1B funds will pay for rail and highway projects including improvement of the ports’ on-dock rail network, which will help reduce truck trips to the ports. Local highway improvements include replacement of the Gerald Desmond Bridge from Long Beach to Terminal Island and construction of an interchange to allow the removal of a traffic light at Navy Way and Seaside Avenue. The ports also propose to improve access from the Harbor Freeway to the Port of Los Angeles and upgrade the Terminal Island Freeway by replacing the Schuyler Heim drawbridge and constructing a four-lane, elevated expressway between Ocean Boulevard and Alameda Street at Pacific Coast Highway. Also proposed is a highway-railroad grade separation in south Wilmington.

The projects are included in the California Goods Movement Action Plan, which was the result of intensive collaboration during the past several years by business, transportation and environmental interests.

In December 2007, the ports approved a cargo fee of $35 per loaded TEU to generate $1.6 billion to help fund the Clean Trucks Program to replace and retrofit old, polluting trucks.

Source: Port of Long Beach

 Ports to Consider Cargo Fee for Transportation Projects

The Long Beach and Los Angeles Boards of Harbor Commissioners on Monday, January 14, 2008, in a joint meeting, will consider a cargo fee that would generate $1.4 billion for transportation projects to improve traffic flow and air quality in the harbor area. The fee would be in addition to one enacted in December to help fund the ports' Clean Trucks Program.

The transportation infrastructure funding would be used for bridge, railway and road improvements used in port-related goods movement, including replacement of the Gerald Desmond and Heim bridges, freeway connector improvements, and port-area rail enhancements, which reduce the need for local truck trips.

Funds generated by the infrastructure cargo fee would be used to match Proposition 1B funds, which California voters approved in 2006 to help pay for major transportation and air quality improvement projects. Together, the cargo fee and Proposition 1B funds will finance about $3 billion in improvements.

"These infrastructure improvements will deliver major benefits to the community in improved traffic flow and reduced air pollution," said Long Beach Port Executive Director Richard D. Steinke. "Importantly, they will also help support the economy and jobs by ensuring the continued efficient movement of cargo."

"Proceeds from this tariff will help make our bridges safer, improve highway safety and congestion, and shift more containers from trucks to on-dock rail," added Port of Los Angeles Executive Director Geraldine Knatz Ph.D. "It also generates local dollars to help our ports obtain additional state and federal funding for infrastructure and air quality projects."

The proposed fee would be assessed on every loaded 20-foot equivalent (TEU) cargo container entering or leaving any terminal by truck or train beginning January 1, 2009. It is anticipated that the charge would be $15 per loaded TEU for seven years, but could vary depending on how quickly the ports move forward with their projects.

If approved by both commissions the cargo fee would apply to the entire San Pedro Bay. Funds from the proposed fee program would be used only for approved local projects. Spending would be limited to specific projects after project approval by the applicable lead agency and fee collection would stop when those projects are completed.

As proposed, cargo fee revenue and Proposition 1B funds would pay for rail and highway projects including improvement of the ports' rail network, which will help reduce truck trips to the ports. Local highway improvements include replacement of the Gerald Desmond Bridge from Long Beach to Terminal Island and construction of an interchange to allow the removal of a traffic light at Navy Way and Seaside Avenue. The ports also propose to improve access from the Harbor Freeway to the Port of Los Angeles and upgrade the Terminal Island Freeway by replacing the Schuyler Heim drawbridge and constructing a four-lane, elevated expressway between Ocean Boulevard and Alameda Street at Pacific Coast Highway. Also proposed is a highway-railroad grade separation in south Wilmington.

The projects are included in the California Goods Movement Action Plan, which was the result of intensive collaboration during the past several years by business, transportation and environmental interests.

Source: The Port of Long Beach

 DHS Agencies Announce Enrollment Dates for TWIC in 10 Ports

The Department of Homeland Security(DHS) today announced that enrollment in the Transportation Worker Identification Credential (TWIC) program will begin at 10 more locations in the coming weeks. This program ensures that any individual who has unescorted access to secure areas of port facilities and vessels has received a thorough background check and is not a known security threat.

TWIC enrollment began Oct. 16, 2007 at the Port of Wilmington, Del. The addition of these 10 locations will bring the number of fixed enrollment centers open for enrollment to 59. Ultimately, the program will be rolled out to 147 fixed enrollment sites and will vet more than 1 million workers through 2008.

"TWIC is one of the world's most advanced interoperable biometric systems and raises the bar on port security," said the Transportation Security Administration's (TSA) Maurine Fanguy, program director for TWIC. "We are off to a strong start with thousands of workers enrolled and credentials issued."

Today, the TSA released specific dates for the following ports:

Victoria, Texas Jan 16, 2008
Kahului, Hawaii Jan 17, 2008
Portland, Ore. Jan 17, 2008
Bourne, Mass. Jan 23, 2008
Green Bay, Wis. Jan 23, 2008
Pittsburgh, Pa. Jan 24, 2008
Texas City, Texas Jan 24, 2008
Kauai, Hawaii Jan 25, 2008
Salisbury, Md. Jan 30, 2008
Toledo, Ohio Jan 30, 2008

Workers at these ports, as well as another 49 where enrollment has begun, are able to pre-enroll for TWIC on the “TSA Web site”. Pre-enrollment speeds up the process by allowing workers to provide biographic information and schedule a time to complete the application process in person. This reduces waiting and in-person enrollment times for each individual.

Source: Transportation Security Administration

 Recent Export Enforcement Cases – August 2007 to November 2007

Nickel Powder to Taiwan – On October 11, 2007, a U.S. Citizen was sentenced to three years probation and to pay a $5,000 criminal fine. On June 21, 2007, the citizen pled guilty to one count of making false statements related to the export of nickel powder controlled for nuclear proliferation reasons to Taiwan without an export license.

Graphite Products to the United Arab Emirates – On October 4, 2007, a District Court Judge in the Western District of Pennsylvania imposed a $40,000 criminal fine against a U.S. corporation. On July 3, 2007, the corporation, represented by their President and empowered official, pled guilty to conspiracy to commit several federal violations related to the shipment of graphite products to the United Arab Emirates with potential nuclear and military applications. The corporation conspired to falsify documents related to the graphite shipment and then attempted to mislead federal investigators when questioned about the shipment and the documents.

Support to a Foreign Terrorist Organization - On November 29, 2007, a U.S. citizen pled guilty to one count of providing material support or resources to a designated foreign terrorist organization, Hezbollah, which involved unlicensed exports of night vision, GPS, and communications equipment to Lebanon. The plea was entered in the Eastern District of Michigan. It was a result of a joint investigation involving Detroit Immigration and Customs Enforcement, Detroit Federal Bureau of Investigation, and the Chicago Field Office.

Nickel Alloyed Pipes to Iran - On November 30, 2007, a British corporation, headquartered in Scotland, United Kingdom, pled guilty in United States District Court for the District of Columbia to one count of violating the International Emergency Economic Powers Act for an Attempted Export Without an Export License. In February 2004, the corporation conspired with other parties in the U.S. to illegally export nickel alloyed pipes to Iran through the United Kingdom and the United Arab Emirates. As part of a global settlement, the corporation has agreed to pay $100,000 in civil penalties and to be subject to a suspended order denying its export privileges for a period of seven years to settle charges that it violated the Export Administration Regula