The DOJ does not state what that discipline should entail, but it does mention
that an employee’s compensation may
be affected as a result of the discipline.
Overall, the DOJ is looking for the
company to understand how serious export control violations are and
will include in its analysis of whether
the remediation has been timely and
appropriate.“Any additional steps that
demonstrate recognition of the seriousness of the corporation’s criminal
conduct, acceptance of responsibility for it, and the implementation of
measures to preclude a repetition of
such misconduct, including measures
to identify future risks.”
Whether a company chooses to self-report criminal conduct to the DOJ
or not, there are certain aggravating
circumstances outlined in the guidance that will reflect unfavorably on
the company and affect the amount of
credit that the DOJ is willing to give.
Although the list is not limited, the
DOJ does give the following examples:
■ ■ Exports of items controlled for
nuclear nonproliferation or missile
technology reasons to a proliferator
■ ■ Exports of items known to be used
in the construction of weapons of
■ ■ Exports to a terrorist organization;
■ ■ Exports of military items to a
hostile foreign power;
■ ■ Repeated violations, including
similar administrative or criminal
violations in the past;
■ ■ Knowing involvement of upper
management in the criminal
■ ■ Significant profits from the criminal
conduct, including disproportionate
profits or margins, whether
intended or realized, compared to
lawfully exported products and
It should be noted that whether a
company makes a VSD or not, disgorgement of illegally-gotten profits
will likely be required.
Trade compliance acronyms
EAR: Export Administration Regulations are rules enforced
by the Bureau of Industry and Security (BIS).
ECCN: Export Control Classification Number is a number showing
the level of export controls under which a product falls.
HTS Code: Harmonized Tariff System is a number given
to a product for the purposes of assessing duty.
CCATS: Commodity Control Classification Automated Tracking System
(CCATS) is an alphanumeric code assigned by the BIS to products that it
has classified under the Export Administration Regulations. A company
may use a CCATS to determine which ECCN applies to its products.
VSD: Voluntary Self-Disclosure means voluntarily self-reporting a violation of the law to a regulatory agency.
A company should, from
a moral point of view,
already be incentivized
to self-report criminal
there are some additional
benefits that the DOJ is
offering to companies
who fully cooperate and
who self-report before
50 ASSOCIATION OF CORPORATE COUNSEL
TATTLING ON YOURSELF: NEW GUIDANCE FROM THE DOJ ON SELF-DISCLOSING EXPORT VIOLATIONS
ACC EXTRAS ON… Self-disclosure
Avoiding Gatekeeper Liability (Dec. 2016).
Climate Change Risk and Sustainability
Disclosures: A New Enforcement Regime
(Nov. 2016). www.accdocket.com/articles/
A New Era in Disclosure – Multijurisdictional
Standards for Attorney-Client Privilege
(Oct. 2016). www.accdocket.com/articles/
European Data Protection: New Rules,
A Whole New Game (Sept. 2016).
Keeping Up with Risks: Ten Common
Information Security Gaps Every In-House
Counsel Should Know (Feb. 2016).
Data Protection Multi-Jurisdictional Guide
(March 2015). www.acc.com/legalresources/
Managing a Global Department (Oct. 2014).
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ON OUR WEBSITE. VISIT WWW.ACC.COM,
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