Congress Ponders AES Modernization Bill

On April 17, 2008 Don Manzullo (R-Illinois) and Adam Smith (D-Washington), introduced new legislation to modernize the Automated Export System. The Securing Exports Through Coordination and Technology Act is described as being able to, “clarify the confusing US export system that punishes mistakes with costly fines” as well as “strengthen the government’s ability to crack down on deliberate violators” as described by Smith and Manzullo. The bill will also include provisions designed to improve the use and operation of e AES.

Under the Act the AES would be required to:

• Reject data submitted for exports that would violate US export control or sanction regulations by virtue of the destination country or entity;
• Alert the exporter of potential export license requirements under the EAR and/or the ITAR based on codes;
• Issue a fatal error notice when the data submitted includes: names, addresses or restricted entities or destination countries subject to US sanctions and embargoes;
• Issue compliance alerts or other warnings to the filer if: the data submitted includes an inconsistent classification number, a license exception which is not available for the country or ultimate consignee or if there is no license number

Exporters say that these types of errors happen often because of the many different export control laws and regulations they have to handle.

Provisions to the bill include:

• Licenses for AES Filers, the DOC could establish a program to license those who file information in the AES on their behalf;
• Shipper’s export declarations and AES filings would be exempted from disclosure to the public, but could be shared with other federal agencies if deemed necessary;
• The DOC would required to work with other relevant agencies to ensure that appropriate personnel are made available to participate in seminars, training and meetings whose purpose will be to educate exporters about US export laws and regulations and the AES in particular.

This bill is far from becoming something that actually requires that exporters take action. As a practical matter, exporters should not even think about doing anything to comply with this potential change. Yet.