U.S. Export & Reexport Compliance For Canadian Operations

Canadian technology companies must now navigate a complex regulatory environment to comply with Canada’s new quantum and semiconductor restrictions. This session will offer key steps and best practices around updating compliance programs, upskilling staff, updated ECL classifications, license requirements and more risk management and due diligence measures.

• Comparing parallels of Canadian law to US semiconductor law
• Updated due diligence around:
• Defining what is “quantum” under these new controls
• Technology for the development or production of semiconductor devices or microchips using Gate-All-Around Field Effect Transistor (GAAFET) structures, e., nanosheet, nanowire, and gate-all-around transistor technology
• Equipment designed or modified for isotropic and anisotropic dry etching, which is critical in the making of GAAFET structures
• Advanced Scanning Electron Microscope (SEM) equipment for imaging semiconductor or integrated circuits, or to perform chip design recovery meeting a specific set of metrics
• Technical specifications of products and matching them new control list entries
• Update to Group 5 of the ECL – Item 5506 titled “Other Strategic Goods and Technology (All Destinations Other than the United States)”
• Determining if an export license is required for specific transactions
• CASE STUDY: Implementation of a robust compliance program that includes policies and procedures for identifying and controlling exports of restricted items

• Interpreting ITAR 126.18 exemptions for intra-company transfers
• Understanding definition of a regular and non-regular employee
• ITAR 126.5 export exemption: How do you meet conditions for the exemption and maintain ITAR compliance?
• What is DDTC proposing as the new definition of a “defence service” license requirement? How do you qualify for Canadian exemptions?
• HYPOTHETICAL EXERCISE: Understanding the TAA Contract Employee clause to avoid potential violations
• Do’s and don’ts for applying EAR Part 734.20/734.18 requirements and exceptions
• Practical impact of U.S. export controls on hiring and staffing decision-making
• Best practices for communications with HR
• Export control restrictions for nationals of sanctioned countries and other parties
• Privacy, anti-discrimination and human rights considerations affecting screening

Using hypothetical scenarios and audience feedback, this session will work through the complexities around how FDPR and de minimis work in practice:

• Common misconceptions around 734.9 (b) FDPR:
  • Reexporting products to China that incorporate U.S.-origin technology or components and the related FDPR complexities
    • When you need to secure export licenses from BIS if the products or technologies are subject to U.S. export controls
• 734.4 de minimis threshold decision-making
  • Tracking and reporting shipments accurately
  • Working with logistics providers to manage thresholds effectively
  • Valuation methods to prevent under-valuation and misclassification of goods
• Updating employee training and monitoring across your organization: Concrete examples
• HYPOTHETICAL EXERCISES: Our experts will discuss the “how to” aspects of navigating multiple layers of compliance and how these U.S. rules apply to Canadian operations
  • Understanding FDPR enforcement actions by the U.S.: Recent case examples and possible parallels

During this timely session, delve into the finer points of the new October 2023 rules along with ones already in place, and discuss how they will affect export operations and supply chains in expected (and unexpected ways) and how they might parallel with Canadian semiconductor restriction requirements.

Topics will include:

• New changes to technical parameters
• Expansion of ICs Controlled under ECCN 3A090
• Affirmative identification of items that “meet or exceed the performance parameters of 3A090 or 4A090” under new ECCN paragraphs and related export clearance requirements
• Semiconductor Manufacturing Equipment: Removal of ECCN 3B090, transfer of entries and expansion of ECCNs 3B001 and 3B002
• Expansion of End-Use Licensing Requirements in EAR § 744.23

What can Canadian industry do to more quickly flag actual or suspected circumvention and diversion? Building on the Pre-Conference Workshop, this session will dissect the nuances of recent export controls with respect to Russia and Belarus, and changes to historical transshipment routes, such as the shift from traditional transshipment hubs in the EU to third countries with less strict export regulations. The discussion will also cover recent schemes-and how they were uncovered.

• How circumvention and diversion schemes are evolving-and the newest warning signs
• Conducting thorough due diligence on partners and suppliers
• Monitoring and auditing transactions and supply chains
• Staying updated on sanctions lists and regulatory changes
• When to seek outside counsel
• Dovetailing export and sanctions risk detection

During this highly anticipated session, delve into the practical and legal consequences for you as a Canadian employer if your U.S. employee fails to comply with these ITAR and EAR licensing requirements

• Clarifying ITAR and EAR licensing requirements for U.S. persons working abroad: What restrictions apply to the types of activities in which the U.S. employee can engage?
• Navigating the road mines in State/DDTC’s updated Guidance for USPAB Authorization Requests (Revision 2.0) as of 09/03/2024, especially with respect to U.S. employees’ furnishing defense services to your vendors, subcontractors, actual or potential customers, or other foreign entities with whom your U.S. employee may work directly
• Demystifying the “alphabet soup” of categories in Commerce/BIS new licensing requirements on U.S. person controls
• Guiding your U.S. person employees to obtain authorization to work on development projects under the ITAR and EAR licensing requirements