2013年12月31日火曜日

TPP ministerial session in December 2013 ends without final agreement


On December 10, 2013, the Trans-Pacific Partnership (“TPP”) free trade talk was wrapped up a ministerial negotiation session without a full agreement in Singapore.  At the end of the meeting, the statement of the ministers and heads of delegation for the TPP countries announced that they have made “substantial progress” toward completing the TPP.  Although the trade talk missed the December 2013 target for ending the talk, they expressed the member countries identified potential “landing zones” for the majority of key outstanding issues in the text.  They decided to continue their “intensive work” to finalize the agreement and expressed the intention to follow up negotiation work and meet again in January 2014.

 
The key issues to prevent the whole negotiation was the conflict between Japan and the United States, which have had trade in goods issues including Japanese tariffs on farm products as well as auto import in the United States.  They failed to fill the gaps during the key session in Singapore.  In addition to tariff issues, the TPP member states have also agreed to carry over to next year on other remaining issues such as intellectual property rights and reform of state-owned firms.


The TPP has now 12 member states, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam, which represent about 40 percent of world GDP and one-third of world trade. 

2013年12月16日月曜日

The Fifth Round of Negotiations for the Japan-Mongolia EPA

The Fifth Round of the Negotiations for the Japan-Mongolia Economic Partnership Agreement ("EPA") will be held from December 16 to 19, and 24,2013 in Ulaanbaatar, Mongolia.

In this round, negotiations in areas including Trade in Goods, Investment, E-commerce, Rules of Origin, Customs Procedures, Competition, Cooperation, Dispute Settlement, Sanitary and Phytosanitary Measures (SPS) and Technical Barriers to Trade (TBT) are scheduled to be held.


2013年12月3日火曜日

Third Round of Negotiations on a FTA among Japan, China and Korea


The third round of negotiations on a Free Trade Agreement (“FTA”) among Japan, China and Korea was held in Tokyo, Japan from November 26 to 29.  In this round of negotiations, wide range of areas such as Trade in Goods, Trade in Services, Investment, Competition Policies, Intellectual Property, amongst others, were discussed.  While these three counties have certain political tension in area of territorial disputes and interpretation of wartime history, a Japanese trade ministry official said “The three countries are cooperating and the political discord has not adversely affected the negotiations.”  According to major newspapers, the work plan of the negotiation was presented to three countries, however, customs tariff negotiation in Trade in Goods was not significant progress this time, as the gap of opinion among the countries is still large.  The three countries will work towards holding the next round of negotiations in Korea, around February 2014.

Tokyo, Beijing and Seoul announced the launch of the FTA negotiation in 2012 and held the first meeting in Seoul in late March 2013. The second meeting was held in Shanghai from July to August 2013.  It is targeted to reach substantial agreement of the negotiation by the end of 2014.

2013年10月16日水曜日

U.S. Export Control Reform: First Final Rules Go Into Effect on Oct 15, 2013

To refer press release of Department of State.

http://www.state.gov/r/pa/prs/ps/2013/10/215428.htm

Third Round of Negotiations on the Japan EU EPA

Press release by Ministry of Foreign Affairs on October 15 announced that the third round of negotiations on the Japan-EU Economic Partnership Agreement ("EPA") will be held in Brussels, Belgium from October 21 to 25.

At the meeting, discussions were conducted on areas such as trade in goods, trade in services, investment, intellectual property rights, non-tariff measures, government procurement and others.

Japan and EU decided to start EPA negotiation on March 2013, and had first and second round of negotiation in April and June this year respectively.
The next round of negotiations is scheduled to take place in the week of January 27, 2014.

2013年10月11日金曜日

China Imposes Embargo Against North Korea

My colleague in Bryan Cave International Consulting Shanghai office posted the useful & interesting article regarding China's embargo list to North Korea.  Here is the one. 
http://www.bryancaveconsulting.com/uploads/files/BCIC_Asia%20Trade%20Bulletin%20Sep-%20Oct%20%202013.pdf


China and other UN member states had, in the past, refused to support a complete embargo against the Democratic People’s Republic of Korea (“DPRK”). The United Nations said that had made it hard for its regulatory agencies to determine whether the Chinese government was imposing substantive sanctions on the DPRK.  Since the DPRK conducted its third nuclear test in February 2013, China has adjusted its export policies toward North Korea, including a complete ban on the export of dangerous goods.

For the implementation of UN Security Council resolutions and according to the Foreign Trade Law, China published an export embargo list of dual use items to the DPRK in an announcement made on September 23, 2013, officially announcing to the public that it is imposing sanctions on the DPRK.


 
The list is promulgated in accordance with UN Security Council Resolution No.1718, 2087, 2094; INFCIRC/254/Rev.11/Part 1, INFCIRC/254/Rev.8/Part 2 published by the International Atomic Energy Agency; S/2012/947、S/2006/853、S/2009/364 published by the UN Security Council; as well as appendix C of UN Security Council Resolution No.2094.

The 236-page list covers the ban on dual-use items and technologies in four major areas including nuclear, missiles, chemicals and biological. While nuclear dual-use items in the embargo list are almost similar to those listed in the Catalog for the Administration of Import and Export Permit for Dual-Use Items and Technologies which is part of China’s export control system, the new list covers more items and technologies related to missiles, chemicals and biological, with more detailed technical specification. 

As the DPRK list is not based on HS code and could potentially have broader coverage, exporters should verify to see if their products for export to North Korea are subject to control.
This is the first time China has issued an embargo list against a specific country.

2013年10月3日木曜日

US export & re-export control seminar on Nov 5 - 6

Please be noted, unfortunately, this seminar is postponed due to the US federal government shut-down.  The new schedule will be discussed when the operation is back to normal.  (as of Oct 11)


On November 5 - 6 in Tokyo, US export and re-export control seminar will be held by US Embassy in Hotel Okura.  Traders who are involved in export compliance should attend this useful seminar.
The details are available in US Embassy web site:

(Seminar brochure in Japanese)
http://japan2.usembassy.gov/pdfs/wwwf-20131105-trade-j.pdf

(Seminar brochure in English)
http://japan2.usembassy.gov/pdfs/wwwf-20131105-trade-e.pdf

2013年10月2日水曜日

Second Round of Negotiations for RCEP

According to press release issued by Ministry of Foreign Affairs on September 27, the second round of negotiations for Regional Comprehensive Economic Partnership ("RCEP") was held in Brisbane, Australia, from September 24 to 27.

In this round of negotiations, the meetings of the Trade Negotiating Committee, in which senior officials participated, and of working groups concerning issues such as Trade in Goods, Trade in Services and Investment were held, and the scope and method of negotiations were discussed.

The next round of negotiations will be held in Malaysia between January 21 and 24, 2014.
RCEP trade negotiation is expected to finalize by the end of 2015.

2013年9月10日火曜日

Japan METI amends control list of dual-use items - Update

METI announced today Sept 10 that the final version of updated control list of dual-use items, and the implementation date is October 15, 2013.

http://www.meti.go.jp/press/2013/09/20130910004/20130910004.pdf


2013年8月30日金曜日

Japan METI updated Foreign User List

On August 30, 2013, Japanese Ministry of Economy, Trade and Industry ("METI") announced its update of Foreign User List, which is WMD proliferation concerned entities list as restricted users.
The list update is just slight modification, adding another possible names of existing restricted entities of North Korea, and add one new entity in China.

http://www.cistec.or.jp/export/express/130830/userlistpress.pdf

One additional entity is supposed to be in China, its name is DCB Finance Limited.  The quick google search shows this entity is front company of Daedong Credit Bank in North Korea.  They are also sanctioned by US Department of Treasury.

2013年8月26日月曜日

Japan METI amends Control List for dual-use items


On July 31, 2013, the Japan Ministry of Economy, Trade and Industry (“METI”) announced the public comment draft that Japan will update control list of dual-use items to reflect the latest changes of international regimes, such as the Wassenaar Arrangement, the Australia Group, the Missile Technology Control Regime, and the Nuclear Suppliers Group.  The draft of control list is for public comment and its comment due date is August 30, 2013.  The implementation of the final updated list is expected within a few months after the due date of public comment according to the past practice.
http://search.e-gov.go.jp/servlet/Public?CLASSNAME=PCMMSTDETAIL&id=595113039&Mode=0

Japan’s current and last control list was implemented in August 1st, 2012 and covers the revisions adopted by the international regimes in their respective control lists. 

The changes made this time in 2013 reflect the ongoing relaxation of control on dual-use items which are mainly used for industrial purposes and applied to military uses at the same time, covering commonly traded dual-use items, such as electronics, computers, telecommunications and information security products etc.  On the other hand, there is a strengthening of control on more sensitive items, such as certain scroll-type compressors (Japanese category 2), or spray-drying equipment (Japanese category 3-2), etc. for which they may be used for development, manufacturing and use of nuclear supply item or chemical weapon.

METI will conduct public seminar end September through early October in Tokyo, Osaka and Nagoya to explain the details of the list update to traders. 
* Date & place of the seminars here: http://www.cistec.or.jp/service/seminar/index.html#kaiseisetumeikai

2013年8月15日木曜日

FTA utilization ratio of JP companies 36%

According to the JETRO 2013 World Trade & Investment Report, the FTA utilization ratio of Japanese companies in 2012 was 36.9%, which is 3% increase last year.  The difference is shown depending on scale of companies.  Large companies ratio is 49.6%, while ratio of SME is 31.5%.

The definition of 'utilization' means among the companies who conduct trade with countries Japan implemented FTA, the ratio shows at least using one FTA either in exporting or in importing.

The interesting point is significant increase of Asean-China FTA utilization ratio increased 4.5% to last year and reached 29.6%.  This shows Japanese companies move to utilize the FTA between third countries.

2013年8月3日土曜日

Second Round of Negotiations on a FTA among Japan, China and the ROK

The second round of negotiations for a FTA among Japan, China and the Republic of Korea (ROK) was held in Shanghai, China from July 30 to August 2.
In this round of negotiations, areas such as Trade in Goods, Trade in Services, Customs Procedures, Competition Policies, amongst others, were discussed.

The next round of negotiations will be held in Japan, and the date is TBD.

2013年7月31日水曜日

Japan update dual-use control list - Draft released for public comment

On July 31, the draft of dual-use items control list update was released for public comment.
This is supposed to reflect Wassenaar Arrangement update in December 2012.

http://search.e-gov.go.jp/servlet/Public?CLASSNAME=PCMMSTDETAIL&id=595113039&Mode=0

Public comment due is August 30, it is expected the implementation date would be around October?

2013年7月13日土曜日

Trade concern raised against Japan’s “wood point stimulus programme”

According to WTO news on 11 July, at the Council for Trade in Goods meeting on 11 July 2013, concerns were raised over certain trade measures by Japan.

The EU expressed concern that Japan’s “wood point stimulus programme” to boost the supply and use of domestic forest products would admit only Japanese wood species and not foreign wood. Canada, New Zealand, US and Malaysia expressed concern that the programme would negatively impact imported wood products.   Japan said that the purpose of the programme is to encourage the use of wood from forests that are increasing in volume. It said that the programme is non-discriminatory, and that foreign suppliers can join the programme.

Reference: 
WTO news http://www.wto.org/english/news_e/news13_e/good_11jul13_e.htm

“wood point stimulus programme” (in Japanese)
http://mokuzai-points.jp/about/index.html

2013年7月9日火曜日

US CCL reflect Wassenaar 2012 update

I'm afraid I missed Federal Register Vol 78 issued on June 20, 2013, which contains Commerce Control List ("CCL") update, reflecting Wassenaar Arrangement December 2012 update.
This rule is effective on June 20, 2013.
http://www.bis.doc.gov/federal_register/rules/2013/78FR37372.pdf

One of the changes for IT industries are, for example, as below.

4D001:  4D001.a is amended by deleting the term "use", because no "use" software of concern could be identified for this entry.

5A002:  Added new paragraph Note 3 - b. which uncontrolled the hardware components of existing items of mass market items.

So, along with Hong Kong's Strategic Trade Control List which is effective from July 8 and reflecting Wassenaar December 2012 list, US CCL is basically in tandem with Hong Kong' list.
Japan is expected to update the list sometime summer in 2013.

2013年7月5日金曜日

Hong Kong export control list update effective on July 8, 2013

As notified in this blog on May 28,
http://japantradecompliance.blogspot.jp/2013/05/hong-kong-export-control-list-updated.html,
Hong Kong's export control list is updated to include updated control items list on international regimes, such as Wassenaar Arrangement dual-use list on December 2012.

The revised control list will become effective on 8 July 2013.
http://www.stc.tid.gov.hk/english/circular_pub/2013_stc08.html

Second Round of Negotiations on the Japan-EU EPA

According to press release on July 3 from MOFA and METI, the second round of negotiations on the Japan-EU Economic Partnership Agreement ("EPA") was held in Tokyo, from June 24 to July 3.
At the meeting, fruitful discussions were conducted on areas such as trade in goods, trade in services, investment, intellectual property rights, non-tariff measures, government procurement and others.
The next round of negotiations is scheduled to take place in Brussels, Belgium in the week of October 21.

EU's request to Japan is not only tariff reduction in trade in goods, but removal of non-tariff measures, such as unclear industrial standard or incomprehensible process for foreign companies in various government approval in Japan.

2013年7月3日水曜日

Third Round of Negotiations for Japan-Canada EPA

According to the press release by MOFA and METI on July 2nd, the third round of negotiations for an EPA between Japan and Canada will be held in Tokyo from Monday, July 8 to Friday, July 12.

The discussion topic information is not available in MOFA web site.  http://www.mofa.go.jp/press/release/press6e_000140.html

2013年7月1日月曜日

The 4th round of negotiation of Japan-Monglica EPA

The Fourth Round of Negotiations for the Japan-Mongolia Economic Partnership Agreement ("EPA") will be held from July 2 to 5, 2013 in Tokyo, Japan.
In this round, negotiations in areas including Trade in Goods, Rules of Origin, Customs Procedures, Dispute Settlement, Investment, Competition, Government Procurement, Sanitary and Phytosanitary (SPS), Technical Barriers to Trade (TBT), E-Commerce are scheduled to be held.

(Source: http://www.meti.go.jp/english/press/2013/0628_01.html )

2013年6月30日日曜日

METI officially announce export control guidance of cloud computing


On June 21, 2013, Ministry of Economy, Trade and Industry (“METI”) in Japan announced the guidance of the interpretation how cloud computing is treated under export control context.  It is the amendment of the Notification No. 492 (locally called as “Ekimu Tsutatsu” its meaning is “Technology/Service Notification”).  This newly added rule will be effective on September 1st, 2013. 

Following is the summary of this cloud computing guidance in the Notification.  The guidance provide the definition and interpretation how METI consider cloud computing service and what scenario would be treated as technology transfer.


  1. New definition of words are added as follows to help the interpretation of cloud computing.
    “Provide (the technology or service)” is defined as “to make it available so that others can make use of”.

  2. “Interpretation of cloud computing”

(1)  In the service to provide computer server for storage and use of information (“storage service”), there is a possibility that the information is stored in the server located in foreign country regardless of the intention of the service user.  Under the contract to make use of storage service, as long as the contract is limited to the information storage for the service beneficiary’s its own use, because such contract is not for transaction to provide technology from service user to service provider, it is in principle NOT regarded as technology transfer under export.

However, if the transaction is substantially to provide specific technology from user to service provider, it is regarded as technology transfer which may require export license.  For example, in case the user have contract with service provider with knowingly that the provider can inspect, acquire or use the stored specific technology, the contract is regarded as the transaction to provide the specific technology.  In addition, if the user find that the provider is actually inspecting, acquiring or using the technology only after the contract is concluded, but the user wish to continue the contract, the time of commencement of providing technology (in other words; when export license is required?) is the reasonable time required to delete information since the such fact is initially found.

Please be noted if the user make use of storage service in order to provide technology to third party, it is off course regarded as technology transfer transaction.


(2) Interpretation of the service the application software located in computer server can be used by others through Internet without downloading (so-called “SaaS”): 

SaaS is considered as the transaction to make service available others can make use of.  Therefore, it is regarded as transaction to provide, and if the technology is classified as controlled technology, the transaction requires export license.

However, please be noted if the software is mass market software, the export license is not required.  (The mass market requirements here are; Generally available to the public by being sold, without restriction, and Designed for installation by the user without further substantial support by the supplier.)

Please be noted the commencement of technology transfer is the time when the service provider make the software available for users.  If export license for the technology transfer is required, the applicant have to obtain the license before the service is available.

 
Comment:  In the past, it has never been announced how METI consider cloud computing under export control context.  The idea in the new Notification is consistent with current export control law and no significant change of direction is seen in its Notification.  We believe traders may have many “what-if” questions case by case, because the Notification shows only basic direction and interpretation.  According to METI, they announce further Q&A (*) relating to cloud computing on their web site to help traders’ understanding and to avoid excessive burden resulting from too rigid interpretation of the new Notification.
 
(*) METI Q&A is in Japanese only.  http://www.meti.go.jp/policy/anpo/qanda25.html
Q&A NO. 55 through 62 is for cloud computing.

2013年6月27日木曜日

JAPAN decided not to impose anti-dumping duty on Indonesian origin cut sheet paper


On June 26, 2013, the Ministry of Economy, Trade and Industry (“METI”) and the Ministry of Finance (“MOF”) jointly announced they determined not to impose anti-dumping duty on cut sheet paper originating in Indonesia.  The cut sheet paper is uncoated printing paper cut to A4 size or other sizes, and is mainly used for plain paper copies and for commercial printing.  Specifically, the questioned cut sheet paper is the ones classified under HS code of 4802.56 and 4802.62.

On May 10, 2012, Japanese paper manufacturing companies (total 8 manufactures) filed an application for the imposition of an anti-dumping duty on cut sheet paper originating in Indonesia to METI and MOF.  Both ministries have conducted joint anti-dumping investigation since June 29, 2012, by providing opportunities for interested parties to present evidence and views, and also collected objective evidence through investigations into Indonesian suppliers and other interested parties.  After the investigation by both ministries, they found no significant fact of dumping, and decided not to impose anti-dumping duty on the product subject to the investigation on June 26, 2013.

2013年5月30日木曜日

New ECCN "500 series" in Category 9

According to the email news from BIS on May 28, BIS publishes a proposed rule on Control of Spacecraft Systems and Related Items the President Determines No Longer Warrant Control Under the United States Munitions List.  State Department publishes a related proposed rule on Revision of U.S. Munitions List Category XV and Definition for “Defense Service.”   Both proposed rules are part of the President’s Export Control Reform Initiative.  Comments on both rules are due by July 8, 2013. BIS Proposed Rule | State Proposed Rule

Quickly looking through the Federal Register, the point is that new ECCN "500 series" will be created for Category 9 for spacecraft including satellites, manned or unmanned space vehicles, which are currently controlled under ITAR USML Category XV.  The changes made to the EAR in the Initial Implementation Rule will be effective on October 15, 2013.

In addition to "600 series" of ECCN, the US ECCN structure will be going unique compared to EU type code.



2013年5月28日火曜日

Hong Kong Export Control List Updated

According to the Strategic Trade Controls Circular No. 6/2013 issued by TID in Hong Kong, their export control items list is updated, namely Amendment of Schedule 1 to the
Import & Export (Strategic Commodities) Regulations.


Quickly looked through the updated list, I find Hong Kong's new list reflect dual use items list of Wassenaar in December 2012. 
For example, deleting the 'use" of software in 4D001, and adding Note 3 (b) 'new mass market exemption of components' of Category 5 part 2. 

The effective date of the new list is not announced, and a separate circular will be issued in due course to inform traders of the effective date of the Order.

(Source: http://www.stc.tid.gov.hk/english/circular_pub/2013_stc06.html )



2013年5月22日水曜日

English translation of export control laws updated

Japanese Law Translation web site, which is maintained by Ministry of Justice, is very useful web site who need English translation of Japanese legal documents. 
http://www.japaneselawtranslation.go.jp/

Recently in mid-May, I find good news and bad news in export control regulations.
Good news is Japanese Law Translation web site updated relevant export control law and the ordinance and posted them.
Bad news is the ordinance, which shows the technical parameter of controlled items, is NOT the latest one, a trader should take care the translation of ordinance may not be the current list.

(1) Foreign Exchange and Foreign Trade Law ("FEFTL") - the translation of FEFTL looks reflecting the latest one.  I find it incorporate the English translation of Article 25 (technology transfer provision) and Article 55-10 (Standards for Exporters provisions), both of they were added some years ago and no significant changes since then.

(2) 貨物等省令 ("The Ordinance" - Ordinance of the Ministry Specifying Goods and Technologies Pursuant to Provisions of the Appended Table 1 of the Export Control Order and the Appended Table of the Foreign Exchange Order)
Actually, this ordinance is difficult to manage the latest translation, as this is updated almost every year.  The translation is updated in May 2013, but unfortunately it is already "old" and not reflecting the latest one.  For example, in 4A003, the controlled computer is "with Adjusted Peak Performance exceeding 3.0 Weighted TeraFLOPS" since August 2012.  However, the English translation of the ordinance shows 1.5 Weighted TeraFLOPS, which is the parameter of a few years ago.

Take care when you refer the translation of the Ordinance.




2013年5月14日火曜日

Second Round of Negotiations for the Japan-Colombia EPA

On joint press release of MOFA and METI, it is announced that the second round of negotiations for the EPA between Japan and Colombia will be held in Cali, Colombia from May 20 to 24.

In this round of negotiations, issues in the areas of Trade in Goods, Trade in Services, Rules of Origin, Custom Procedures, Intellectual Property, Competition, Cooperation and Improvement of Business Environment are scheduled to be discussed.

(Update on May 28)
From May 20 to 24, the second round of negotiations for the EPA between Japan and Colombia was held in Cali, Colombia as originally scheduled.
In this round of negotiations, progress has been achieved through negotiations in areas including Trade in Goods and Services, Rules of Origin, Customs Procedures, Intellectual Property, Competition, Cooperation, and Improvement of Business Environment.
Both sides decided to hold the third round of negotiations in Tokyo, and the dates would be decided through diplomatic channels.  Both sides decided, in the mean time, to continue to work to make as much progress as possible in each area in a flexible manner including holding teleconferences.






2013年5月9日木曜日

International Trade Compliance Programs; The Ralph Lauren Example

The violation case study of Ralph Lauren in their Argentina subsidiary is good example how effective the Trade Compliance Program implementation in view of FCPA enforcement. 

See SEC press release in:
http://www.sec.gov/news/press/2013/2013-65.htm

2013年5月3日金曜日

First Round of Negotiations for RCEP

On May 2nd, MOFA and METI jointly announced the first round of negotiations for Regional Comprehensive Economic Partnership ("RCEP") will be held in Bandar Seri Begawan, Brunei Darussalam, from May 9 to 13.

In this round of negotiations, the meetings of the Trade Negotiating Committee, in which senior officials will participate, and of working groups concerning issues such as Trade in Goods, Trade in Services and Investment are scheduled to be held, and the scope and method of negotiations, amongst others, will be discussed.

(Updated on May 14)
The first round of negotiation of RCEP was held as scheduled.
In this round of negotiations, the scope and method of negotiations, amongst others, were discussed.

The next round of negotiations will be held in Australia between September 24 and 27.

(http://www.mofa.go.jp/press/release/press6e_000073.html)





2013年4月12日金曜日

Japan-Canada EPA second round of negotiation

With the TPP negotiation announcement recently, the negotiation of other EPAs are also accelerating.
Japan and Canada will have second round of EPA negotiation on April 22 through 26 in Otawa, Canada.

http://www.meti.go.jp/press/2013/04/20130411001/20130411001.pdf

2013年4月10日水曜日

Japan - EU EPA first round of negotiation

According to the news release by METI and MOFA, the first round of EPA negotiation will take place on April 15 through 19 in Belgium. 

http://www.meti.go.jp/press/2013/04/20130409002/20130409002.pdf

2013年4月9日火曜日

METI draft export control guidance of cloud computing

On April 9, METI unveiled draft of guidance notification how cloud computing should be treated under export control regulation in Japan.  The draft is for public comment and its due date is May 8.  It is expected the updated notification will be effective around June 2013.
The draft is available in following URL in Japanese.  (As always, no English publication.)
http://search.e-gov.go.jp/servlet/Public?CLASSNAME=PCMMSTDETAIL&id=595213010&Mode=0

The summary of the cloud computing guidance is as follows.  The guidance provide the definition and interpretation how METI consider cloud computing service under technology transfer export control.


1. The data storage service in cloud computing:
In case the server of cloud computing is located in foreign country and the data is stored outside of Japan, it is generally not subject to export control regulation as long as the transaction is limited to data storage secured by contract with service provider and user.  However, if the contract of Japanese user and the foreign data storage provider include the possibility that foreign provider can inspect, acquire, or make use of the stored data, it may be subject to export control regulation, by being regarded as technology is transferred overseas.


2. SaaS (Software as a Service) scenario:  
SaaS is a name of the service a user can make use of application software through Internet without downloading to personal devices.  SaaS is generally considered as subject to export control regulation.  Because this scenario is a service transaction to provide service a user can utilize the software function crossing international boarder.  However, if the software is mass market software which is available to anybody without limitation, it is excluded from export control scope.


Comment:  It is first time METI officially provided written guidance to cloud computing.  Industries in Japan have been awaiting this for years and in the past, they had issued opinion letters under the name of some industry associations. 
Above 1 (data storage part) mostly reflect industry's opinion, and seems to be reasonable interpretation.  However above 2 (Saas part) is contrary to industry's opinion.  Actually industries have requested SaaS should not be treated as subject to export control, because SaaS is not technology transfer but merely data processing.  Also it is "illogical jump" to consider SaaS is transfer of software itself.

As it is now public comment stage, I believe many negative comments will come especially in SaaS part.


2013年4月8日月曜日

Japan - Mongolia third round of EPA negotiation take place

MOFA and METI jointly announced the progress of Japan - Mongolia EPA negotiation on April 5th.
The summary is as follows:

http://www.mofa.go.jp/press/release/press6e_000026.html

2013年4月5日金曜日

Japan continue trade ban to North Korea for another 2 years

Japan METI announced on April 5 that Japan continue embargo to North Korea for another 2 years.
This treatment is almost complete embargo both on export and import for North Korea origin items and goods from/to North Korea port.  In addition, brokering activities and financial transactions relating to North Korea are also prohibited. 

This embargo treatment is basically same as the ones until last year.  This has been extended one year each on April every year since 2006, and this year the treatment continue for 2 years until April 2015.

(Source:  http://www.meti.go.jp/press/2013/04/20130405001/20130405001.pdf )

METI Update of Foreign User List

On April 5, Japan METI update its Foreign User List, also know as WMD Proliferation Concerned Parties List.  This update is not addition of new entity name, but supplementing existing entity name in North Korea, thus actually no substantial change.  Total number of entities remain unchanged as 450.
The change is as follows.

(Old)
Country Name:  North Korea
Entity Name:  Trade Bank of DPRK, aka (also known as),  Mooyukeunhaeng

(New)
Country Name: North Korea
Entity Name: Foreign Trade Bank of the Democratic People’s Republic of Korea,
aka, FTB, Mooyukeunhaeng, or North Korea's Foreign Trade Bank.

Above change is in line with asset freeze measure notification by Ministry of Foreign Affairs Japan.

(Source:  http://www.meti.go.jp/policy/anpo/law09.html#418 )




2013年3月29日金曜日

Japan bulk export license requirement update

METI announced its update of bulk export license notification as of March 29, 2013.
As posted in this blog last month Feb 9, the draft of this update was posted for public comment.
This change is effective on April 1st, 2013.  Below is the summary of the change.

1.AEO approved exporter will have a benefit in applying bulk export license:
In order to apply bulk export licenses in Japan (excluding White country bulk license), on-site audit by METI has been mandatory requirement for a new applicant. The update in the notification eliminate METI on-site audit only for AEO exporter. It is allowed for AEO exporter to apply bulk license without METI on-site audit. This exemption is certainly welcomed by AEO exporter who don't have METI bulk license.


2.METI official seminar participation no longer required for bulk license application and extension:
The attendance to METI official export control seminar by full time employee has been mandatory requirement before bulk license application, and also in renewal of bulk license in extending its validity. This seminar requirement is eliminated, and instead, the new requirement is added as:
"Exporter should collect latest export control regulatory update and disseminate it to relevant employees internally".
In addition, the participation of the official seminar is not required also in renewal of bulk license.
In essence, exporter should not reply on government effort but try themselves to be compliant.


2013年3月22日金曜日

First Round of Negotiations on a FTA among Japan, China and Korea

The first round of negotiations for a Free Trade Agreement ("FTA") among Japan, China and Korea will be held in Seoul, Korea from March 26 to 28.
In this round of negotiations, the scope and method of negotiations, amongst others, will be discussed.

In addition to the announcement of joining TPP negotiation, this trilateral FTA in East Asia is also significant step forward to Japan.


http://www.mofa.go.jp/press/release/press6e_000003.html




2013年3月21日木曜日

US - Korea FTA origin certification method

Under US-Korea FTA, the origin certification method is by self-certification.  This is not by approved exporter by authority in EU, but is allowed to declare by importer, exporter or producer.

The text is here in page 7 - 8 in following URL.
http://www.ustr.gov/sites/default/files/uploads/agreements/fta/korus/asset_upload_file680_12704.pdf

My interest is whether TPP adopt this method or existing method issued by government designated organization.


2013年2月24日日曜日

US, Japan say TPP talks wouldn't exempt areas

On Feb 22, 2013, Joint Statement by the United States and Japan are announced on MOFA web site.

http://www.mofa.go.jp/mofaj/kinkyu/20/H302013022318425501A/filLink2.pdf

Should Japan participate in the TPP negotiations, all goods would be subject to negotiation, however the statement acknowledged "sensitivities" on both ends, including agricultural products for Japan and manufactured goods for the United States. 

The keywords of this announcement is here:

"As the final outcome will be determined during the negotiations, it is not required to make a prior commitment to unilaterally eliminate all tariffs upon joining the TPP negotiations."

This statement follows the political commitment Prime Minister Shizo Abe made domestically in the general election in December 2012, Japanese government will be able to go forward internal procedure to formally join TPP negotiation.





2013年2月14日木曜日

Violation case study: Export of sample goods can be costly

On this lovely valentine day, I happen to find export control violation case in online news site, it is export of rifle scope without METI export license to China and Germany.  The company name is VIXEN CO.,Ltd, located in Saitama prefecture, Greater Tokyo area in Japan.  They are optical equipment manufacturer, with a focus on astronomical telescopes, binoculars, and microscopes.  The details of violation case is not announced in newspaper, it is only mentioned as "export of rifle scope without export license."  My assessment is the rifle scope is classified as military items, Category 1 (i) of Export Trade Control Order.  The description of this category is "Firearms, ammunition, or accessories or parts ".  Japan have tough stance in export of military items and there is substantially no license exception for Category 1.  For example, low value exception is not applicable to items of Category 1.

This company immediately posted the announcement on their web site and explain what happened.
http://www.vixen.co.jp/info.htm#130214a

The article in their web site shows they admit the export of rifle scope without export license.  But they explain the export transaction was "not for ordinary sales operation, but sample shipments before mass production".  In addition, "For normal sales export transaction, the company have applied and hold export license by METI in due course."  It looks they emphasize this export violation case is unexpected isolated error in sample goods give away.

As most of export control professional know, there is no license exception for sample goods export.  As long as the goods falling into the technical criteria of control items list of Export Trade Control Order, export license is required regardless of sales goods or samples.  The company have to take measures to prevent further violation, investigated by police, and the company name is negatively reported by media.
The careless sample goods export can be costly.

2013年2月12日火曜日

AEO exporter benefit in Japan bulk export license

As of February 9, 2013, a draft proposal to change Japan bulk export license regulation is posted on e-gov web site for public comment. 
http://search.e-gov.go.jp/servlet/Public?CLASSNAME=PCMMSTDETAIL&id=595113010&Mode=0

The draft proposal is, as always, in Japanese only, let me summarize the main points of change.

  1. AEO approved exporter will have a benefit in applying bulk export license:Currently, in order to apply bulk export licenses in Japan (excluding White country bulk license), on-site audit by METI is mandatory requirement for a new applicant.  The proposed new provision will eliminate METI on-site audit specifically for AEO exporter.  It is allowed for AEO exporter to apply bulk license without METI on-site audit.  This exemption is certainly welcomed by AEO exporter who don't have METI bulk license.
  2. METI official seminar not required for bulk license:  Currently, the attendance to METI official export control seminar by full time employee is mandatory requirement before bulk license application, and also in renewal of bulk license in extending its validity.  This seminar requirement will be eliminated, and instead, the new provision states as: "for exporter to get latest export control regulatory update and disseminate it to relevant employees internally".  In addition, the participation of the official seminar is not required also in renewal of bulk license.  In essence, exporter don't reply on government effort, but try themselves to keep update.
My finding and comments are:
  1. Benefit in AEO exporter: 
    AEO system is governed by Customs under Ministry of Fiance, while export control is under METI.  Historically, there have been very little interaction between Customs and METI in regulatory development in export control, but this announcement is new trial to remove barrier between Ministries.  I appreciate this new trial by METI and Customs.  Because, in order to be AEO exporter, there have been duplicated effort as export control in ICP implementation or set up export operation procedures, it would be welcomed by traders.  However, I notice the AEO exporter is only 246 companies in Japan as of January 2013, and many of them are likely to already have bulk export license.  Therefore, the beneficial impact will be limited to small number of companies.
  2. METI official seminar not required: 
    This will be welcomed by traders as relax of the requirements, because METI official seminars have been conducted in only a few chances a year in limited cities, and the number of seats have been limited each time, it has been inconvenient for traders.  The seminar material is always posted and available in METI web site, and its content is pretty basic level.  I find there is no strong reason to continue this government official seminar by spending resource of tax payer in Japan.
The public comment is by March 10, 2013.  The Bulk License Notification will be update accordingly perhaps April 2013 onward.


2013年2月6日水曜日

METI update proliferaiton concerned parties list

Today on Feb 6, 2012, Ministry of Economy, Trade and Industry ("METI") announced the update of their sanctioned parties list, called as "Foreign User List" which is WMD proliferation concerned parties list.

http://www.meti.go.jp/policy/anpo/law09.html#414

The substantial change is actually limited to the addition of only one entity in Hong Kong.  The company called "Leader (Hong Kong) International", is newly added into the list.
This entity is said as an agent for KOMID, a North Korean mining and trading company, that was sanctioned in 2009 and is the North Korea's main arms dealer.  Leader is separately blacklisted by the United Nations and the U.S. Treasury Department.

2013年1月15日火曜日

Singapore update its export control list on Feb 2013

Singapore Customs has announced the latest list of control under SGCO 2013 on 8 Jan, and the Order will take effect from 1 Feb 2013.

You can view the new subsidiary legislation online at the following URL:
(Be careful, below links to large size of  pdf file.)
http://www.customs.gov.sg/NR/rdonlyres/177959A4-7BC3-42C1-BA7B-455A29FACCDE/0/StrategicGoodsControlOrder2013.pdf

The update list is basically in link with Wassenaar list as of Dec 2010 and certain selected updates as of Dec 2011.  (But not including Wassenaar Dec 2012 version, I think.)

For global IT trader, good news is that Category 5 part 2 Note 4 (ancillary exemption) is finally included in Singapore export control legislation.