Anti-Boycott

Reviews and Investigations Dealing with US Authorities

• Conducted an extensive internal review covering multiple years and over 1000 transactions for a large US chemical company that was at risk of recidivist liability. Steptoe worked intensely and collaboratively with a team of in-house attorneys to conduct a transaction-by-transaction review, developed defensible positions to eliminate the majority of transactions from US regulatory jurisdiction, met and advocated with US government authorities, and achieved a no action result for the client.
• Conducted an investigation under the EAR and assisted with a voluntary disclosure to the DOC of an oral request received by a customer in a boycotting country, which the US headquartered business incorporated into commercial documentation for shipment of items manufactured in a third country in Asia. The US government did not pursue an enforcement action.
• Assisted a client with an Office of Anti-Boycott Compliance-initiated anti-boycott audit, including pre-audit review and risk assessment concerning multiple transactions, which led to a preemptive voluntary disclosure (where the agency accepted it as such). We then assisted the client with the audit, responded to follow-up requests for documentation, and ultimately received a warning letter to close out the audit and disclosure without a penalty.
• Advised a large US multinational on tax return reporting issues and disclosures to the IRS pursuant to the Compliance Assurance Process (CAP).

Advice on Transactions/Situations

• Provided anti-boycott advice regarding certain provisions of a proposed arrangement for freight forwarding services involving trade in Central Asia. We also conducted a detailed legal analysis of the commercial arrangement and provided a written opinion on the likelihood of penalties of the modified language in the agreement under the Code.
• Analyzed potential anti-boycott implications of clauses for an insurance company related to a Note Purchase Agreement for the extension of debt to a European company that had significant operations in boycotting countries.
• Assisted an aerospace company whose products were rejected during entry into a boycotting country because they were manufactured in a boycotted country.
• Counseled an oil and gas company on income tax and tax reporting implications related to joint venture agreements.

Compliance Training

• Prepared for an aerospace and defense company a matrix of commercial clauses encountered in various documents used in multiple Arab boycotting countries, and provided a concise assessment of whether these clauses (a) triggered reporting requirements either under section 999 of the Code or section 760.5 of the EAR, and (b) whether these clauses constituted a penalizable agreement or prohibited action under the US anti-boycott laws. The matrix became part of the internal compliance resources of this company.
• Conducted basic and train-the-trainer training sessions and prepared related materials or aids for clients in the mining, lubricants and additives, oil field service and component providers, chemical, commodities trading, agriculture, and aerospace sectors. These efforts have included travel to US and foreign business sites to conduct in-person trainings, as well as teaching sessions presented via video conferences, webinars, and teleconferences with participants in the US and abroad at various skill levels and for different segments of personnel (e.g., legal, finance, contracts, supply chain, business development/capture team).
• In addition to anti-boycott compliance education, Steptoe has also provided international regulation and compliance training. These efforts have included materials and guidance regarding anti-corruption, economic sanctions and export controls, and anti-money laundering/counter-terrorism financing laws and rules that may apply and could be presented in conjunction with or integrated as part of anti-boycott training.