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such instance shall be considered by the record, to the extent he deems said sumCompliance Commissioner as provided mary or extract relevant and material. in § 388.4(a). If an answer has been Thereafter, the respondent may submit filed and no oral hearing has been de evidence in explanation or contradiction manded, the same shall be deemed thereof. In no case shall the respondent waived, and the Compliance Commis or his attorney be entitled to inspect the sioner shall proceed to consider the case classified materials. upon all the pleadings and evidence (d) The Compliance Commissioner available and shall provide for the may administer oaths and affirmations. making of the record in such manner Respondent may be represented by as he deems appropriate. If an answer counsel but need not be. The proceedhas been duly filed and an oral hearing ing shall be taken by a reporter, tranhas been demanded, the Compliance scribed, and filed with the Compliance Commissioner shall set the case for such Commissioner. Respondents shall have hearing, and due notice thereof shall be an opportunity to examine the trangiven to the respondent or his attorney. script and to obtain a copy upon payA respondent is not entitled to notice of ment of proper costs. hearing unless he has answered, raised
8 388.8 Proceedings before and report issues to be determined as provided in
of Compliance Commissioner. $ 388.5 and has made demand for hearing. If neither the respondent nor any
(a) In any situation for which the one on his behalf shall attend a hearing regulations in this part make no prowhich has been set after due notice vision, the Compliance Commissioner given, the hearing shall nevertheless may, in his discretion, conform the proproceed in his absence, and such absence ceedings before him to the Federal Rules shall not affect the validity of the hear
of Civil Procedure. ing or any proceedings or action (b) The Compliance Commissioner thereafter.
shall consider the record and shall pre(b) Hearings shall be conducted by pare written report which shall include the Compliance Commissioner in a fair findings of fact, including a finding and impartial manner. The rules of evi whether or not a violation has occurred, dence prevailing in courts of law shall and recommendations. The report, trannot apply, but all evidentiary material script, and exhibits shall be transmitted relevant and material to the inquiry shall to the Director, Office of Export Control, be received and given appropriate Bureau of International Commerce. weight.
§ 388.9 Disposition of proceeding. (c) Because the Export Administration Act of 1969 is concerned with na
If the Compliance Commissioner finds tional security and foreign policy, rele
that the evidence is not sufficient to jusvant and material evidentiary materials
tify the conclusion that a violation has bearing on the enforcement of the Act,
been committed, the Director, Office of whether classified or not, must be con
Export Control, shall enter an order sidered by those making decisions in pro
dismissing the charges. If the Compliceedings under the Export Control
ance Commissioner finds that a violaRegulations. Diligent effort shall be
tion has been committed, his recommade, however, to declassify such clas
mendation shall be advisory only, and sified materials or to secure unclassified
the Director, Office of Export Control, summaries of or extracts from such
shall review the record, consider the reclassified materials, when not contrary
port of the Compliance Commissioner, to any statute or security regulation.
and determine the disposition of the case. Whenever an unclassified summary or
He may then issue an order denying the extract of classified evidentiary mate
respondent's export privileges, as prorials shall be offered, the Compliance
vided in § 388.1, or take such other acCommissioner shall compare it with the
tion as he deems appropriate. Any order related classified materials. If he finds
issued shall be effective for such period that the summary or extract is supported
of time and shall contain such additionby the classified materials and omits
al terms and conditions as may be only so much as remains classified, he deemed appropriate and prescribed may, subject to the right of the respond therein. A copy of the order together ent to object on grounds of relevancy with a copy of the Compliance Commisand materiality, admit the unclassified sioner's report shall be served upon the summary or extract as part of the open respondent, in the same manner as pro
vided in § 388.3(b) for service of a charging letter, or upon his attorney. § 388.10 Consent orders.
The Investigations Division of the Office of Export Control, and the respondent, after transmission of a charging letter, may, by agreement, submit to the Compliance Commissioner a proposal for the issuance of a consent order. The Compliance Commissioner shall review the facts of the case and the proposal and, for this purpose, may conduct informal conferences with the parties and may require the informal presentation before him of the evidence in the case. If he does not approve the proposal, he shall so notify the respondent or his attorney and the Investigations Division, and the case shall proceed to hearing. If he approves the proposal, he shall report the facts of the case with his recommendations to the Director, Office of Export Control. The Director, Office of Export Control, may reject the proposal, in which event the case will proceed to hearing, or he may accept the proposal and issue an appropriate order. § 388.11 Temporary denials.
(a) Denial within charging letter. A charging letter from and after the date of its issuance may deny to any respondent the privilege of participating directly or indirectly in any manner or capacity in any transaction involving commodities or technical data in whole or in part exported or to be exported from the United States to any foreign destination pursuant to any validated export license. The charging letter may also suspend or revoke and require the return for cancellation of outstanding validated licenses, but shall not otherwise deny export privileges to the respondent. Such latter privileges, however, may be denied as provided in paragraph (b) of this section.
(b) Temporary denial orders-(1) Grounds for issuance. Any person who is under investigation, or against whom administrative or judicial proceedings are pending, for violation of any law or regulation relating to ex control, may be summarily denied export privileges, as set forth in § 388.1, without prior notice or opportunity for hearing, where and to the extent such denial of export privileges is found reasonably necessary to protect the public interest pending final disposition of the investi
gation or proceedings. Such a temporary denial order shall be issued only for such limited time, ordinarily not exceeding 30 days, as may be required to complete the investigation or the proceedings, but may, on a showing of need for additional time, be extended in the same manner as originally issued.
(2) Procedure for issuance. An application for a temporary denial order shall be made by the Investigations Division, Office of Export Control, to the Compliance Commissioner and shall include a brief recital of the facts and a statement of the grounds for the application and the nature of the order sought. The Compliance Commissioner shall review the application and may require informal presentation of evidence before him. If he does not approve the application, he shall so notify the Investigations Divisions by memorandum, and no further action shall be taken upon it. If he approves it in whole or in part, he shall send his recommendation, together with the application and accompanying documents, to the Director, Office of Export Control, who may issue such temporary denial order as he shall deem appropriate. A copy of the order shall be sent to the respondent in the same manner as provided in § 388.3(b) for service upon him of a charging letter.
(c) Motions to vacate or modify-(1) Motion to vacate. The respondent may at any time move to vacate or modify any temporary denial of export privileges contained in any charging letter or order. Any such motion shall be filed with the Compliance Commissioner and an oral hearing thereon, if requested, shall be held before the Compliance Commissioner at the earliest convenient date. The Compliance Commissioner shall consider the evidence presented and shall submit his report and recommendations thereon to the Director, Office of Export Control. The latter may issue such order disposing of the motion as he deems appropriate, and a true copy thereof shall be sent promptly to the respondent or his attorney.
(2) Continuation and extension. In any case where no motion is made pursuant to subparagraph (1) of this paragraph to vacate or modify a temporary denial, or where, if such motion is made, substantial evidence is not presented to support the granting thereof in whole or in part, such denial or any modification thereof may be continued and ex
tended to and including completion of the proceedings.
(d) Deferment of action on license applications otherwise prohibited. Except for the particular application or license which is itself the basis of any investigation or proceeding, and except pursuant to paragraph (a) of this section, no export license application filed by any person shall be returned without action, held without action, or rejected, solely because such person is under investigation, or that proceedings against him are pending, otherwise than in accordance with the terms of a temporary denial order issued under paragraph (b) of this section. 388.12 Rehearings.
The Compliance Commissioner may, upon written request, grant a rehearing or reopen a proceeding at any time for the purpose of hearing any relevant and material evidence which was not known or which was unobtainable at the time of the original hearing. The request for rehearing or reopening shall contain a summary of such evidence, the reasons why it is deemed relevant and material, and the reasons why it could not have been presented at the original hearing. The Compliance Commissioner shall give prompt notice of the time and place of any further hearing, if one is held, and shall conduct such hearing and submit his report and recommendations thereon to the Director, Office of Export Control for final action in the same manner as provided for the original proceeding as described in § 388.9. § 388.13 Appeals.
(a) Grounds and conditions for ap: peal (1) Grounds shall be specified. The
respondent may appeal from a denial of export privileges, from a denial of privileges of practice, or from the imposition of a civil penalty, upon the ground (i) that the findings of violation are not supported by any substantial evidence, (ü) that prejudicial error of law was committed, or (iii) that the provisions of the order are arbitrary, capricious, or an abuse of discretion. The appeal must specify upon which of these grounds the appeal is based and must indicate from which provisions of the order the appeal is taken.
(2) Previous motion for relief. An appeal from a denial upon default, a temporary denial, or an indefinite denial will not be entertained unless and until
the respondent has moved unsuccessfully for relief as provided in § 388.4(b), § 388.11(c), or $ 388.15 as the case may be.
(b) Filing of appeals. An appeal must be in writing and shall be filed with, and addressed to, the Appeals Board, U.S. Department of Commerce, Washington, D.C. 20230. An appeal from a final order denying export privileges shall be filed within 10 days after receipt of a copy of the order. The provisions of Part 389 of the Export Control Regulations in this subchapter shall govern the procedure and disposition of appeals, except as otherwise provided in this Part 388.
(c) Matters considered on appeal. A hearing before the Appeals Board shall not constitute a trial de novo, but the appeal shall be considered upon the basis of the record, consisting of the charging letter, the transcript of the hearing before the Compliance Commissioner, the report of the Compliance Commis.. sioner, the order of the Director, Ofice of Export Control, and any other relevant documents involved in the proceedings before the Compliance Commissioner. If the respondent has requested and been denied a rehearing or reopening on the basis of new evide ce, the Appeals Board may direct that such rehearing or reopening be granted it it finds that such new evidence is relevant and material to the issues and was not known or was not available to the respondent at the time of the original hearing. The Appeals Board shall not consider facts or arguments affecting the merits of the policy embodied in rules or regulations alleged to have been violated.
(d) Effect of appeal. The taking of an appeal shall not stay the operation of any order. The decision of the Appeals Board shall be final and shall be transmitted promptly to the respondent or his attorney. § 388.14 Proceedings confidential.
Compliance proceedings shall be confidential, excepting any orders issued therein. Reports of the Compliance Commissioner and copies of transcripts of hearings shall be available only to parties to the proceedings and, to the extent of their own testimony as contained in transcripts, to witnesses therein. Any such matters may, however, be made available to any government agency having a proper interest therein.
§ 388.15 Failure to comply with inter revoking such probation period upon a
rogatories or requests to produce charge that the conditions of such proevidence-indefinite denial.
bation have been breached. The facts in (a) Whenever the Office of Export
support of such application shall be preControl finds it impracticable, during the
sented to the Compliance Commissioner course of an investigation or other pro
who shall report thereon, and make a ceeding or action, to subpoena a person,
recommendation as to the action to be or his books, records, other writings, or
taken, to the Director, Office of Export other tangible things bearing upon the
Control. The Director, Office of Export matter being investigated, the Office of
Control shall then determine whether the Export Control may serve upon such per
conditions have been breached and issue son interrogatories, requests for admis
such order he may decide is sions facts, requests
appropriate. production of books, records, and other
(b) Hearing-(1) Objections upon writings, or requests to produce or make.
notice. Any person affected by a notice available other tangible things for in that an application is being made to respection, including commodities or tech voke a probationary period may, within nical data exported from the United
the time specified in the notice, file with States, as therein specifically set forth. the Compliance Commissioner any objecIf such person, within 20 days after sery
tions he may have to the application. ice thereof, fails or refuses to furnish re (2)" Objections to order without notice. sponsive answers to such interrogatories
Any person affected by an order revokor requests for admissions, fails to pro ing a probationary period without notice duce the requested books, records and may request that such order be set aside other writings, or fails to produce or by filing with the Compliance Commismake available for inspection other
sioner his objections thereto. Such retangible things “requested, including
quest will not stay the effective date of commodities or technical data exported
the order of revocation. from the United States, which are in his (3) Requirements for filing objection. possession, custody or control, without: Objections shall be filed in writing and good cause being shown, an order may be in duplicate with the Compliance Comissued without prior notice, as provided
missioner. All denials and admissions, in § 388.1, denying export privileges to as well as the facts of any mitigating cirsuch person. This order shall remain in cumstances, which the person affected effect until such person shall respond to intends to present shall be set forth in the interrogatories or requests or shall or attached to the letter of objection. All give adequate reasons for his failure or contentions must be supported by evirefusal to so respond. Such interroga- , dence. A request for an oral hearing may tories or requests may be served in the be made at the time of filing such same manner as provided in § 388.3(b) objections. for service of a charging letter,
(4) Determination. The application (b) The procedure regarding applica-and any objections thereto shall be retions for indefinite denial orders and mo ferred to the Compliance Commissioner tions to vacate or modify such orders and, if an oral hearing is requested, he shall conform substantially to that pro-, shall conduct such hearing at the earliest vided for temporary denial orders by convenient date. Thereafter he shall re$ 388.11 (b) (2) and (c).
port the facts and make a recommenda
tion to the Director of the Office of Ex§ 388.16 Orders containing probationary periods.
port Control, who shall then determine
whether the application should be (a) Revocation of probationary peri granted or denied. After the Director's ods. An order denying export privileges determination following either an applito any person may provide a probation cation on notice for revocation or an apary period during which such denial plication to set aside a revocation, a copy order is held in abeyance for all or part of the order and of the Compliance Comof the denial period provided by the missioner's report shall be sent to any order, subject to conditions set forth
person affected thereby. therein. With or without notice to any (c) Effect of revocation other person to be affected thereby, the Direc actions. The revocation of a probationtor, Investigations Division, Office of ary period shall not preclude any other Export Control, may apply to the action concerning a violation upon which Compliance Commissioner for an order such revocation is based.
$ 388.17 Extension of time.
A respondent may, on good cause being shown, apply to the Compliance Commissioner for additional time within which to prepare and submit his answer to the charging letter or do any other act required by this Part 388. $ 388.18 Publication of orders.
All orders denying export privileges and, all decisions of the Appeals Board in appeals under $ 388.13 shall be published in the FEDERAL REGISTER as soon as practicable after issuance; except that such orders and decisions need not be published where they provide for the imposition of a civil penalty alone or as an alternative to the denial of export privileges and where such civil penalty has been paid before the denial of export privileges becomes effective. Copies of all orders and decisions that are not published in the FEDERAL REGISTER are available for public inspection at the Office of the Director, Office of Export Control. Supplement No. 1-Table of Denial
and Probation Orders Currently in Effect (a) Contents. This table lists orders issued by the Office of Export Control that eurrently deny export privileges and/or place persons or firms on probation. Orders are published in full in the FEDERAL REGISTER, 15 cited in the column entitled, "Federal Register Citation.”
(1) Related parties. Some of the indi. riduals and firms whose names appear in the column entitled "Name and Address" were not found to have violated, any law or reguation, but they have been made subject to lenial or probation orders pursuant to į 388.1(b). In such cases, an appropriate note uppears in the column entitled "Export. Privileges Affected."
(2) Probation periods. The basic order lenies export privileges to the party or parles named. In some cases, denial of privieges is
combination of immediately ffective denial and probation. In other cases, he entire order may be a conditional prosation. Probation is always conditioned upon compliance with the law and regulations luring the period of probation and it may be evoked summarily in the event of failure to omply. In the column of this table entitled Expiration Date," the termination date of he period of actual denial appears, and in he event the order contains a probation period, that fact and its expiration date are hown enclosed in parentheses. During the probation period a party is entitled to all Xport privileges.
(3) Denial Orders-Temporary and Inlefinite. The rules provide for temporary and
indefinite orders. The table shows the expiration date of temporary orders in the “Expiration Dates" column as either a specific date, or "Until Further Notice." An indefinite denial order is issued under $ 388.15 because of failure to answer Interrogatories or produce evidence. The order remains in effect until there is proper response or adequate reasons are given for failure to do so. The expiration date is shown as "Indefinite."
(4) Denial Order for "duration" of export controls. Whenever the word “Duration" is shown in the "Expiration Dates" column of the table it means that a denial order has been issued denying export privileges for the duration of export controls; that is, as long as the Export Administration Act of 1969, or successor legislation that provides for carryover, is in effect.
(5) Proceedings confidential. Proceedings in compliance cases, except for orders which have been published, are confidential.
(6) Publication of orders. New or amended denial and probation orders are published in the FEDERAL REGISTER as they are issued, and their issuance announced in Export Control Bulletins.
The table of Denial and Probation Orders is revised and brought up to date semiannually by adding new or amended orders and. deleting orders which have expired. An addendum to the table is published in the Export Control Regulations with the list of orders maintained on a current basis between the semiannual revisions of the table.
(b) Effect of Denial Orders, Section 387.10. of the Export Control Regulations makes it unlawful, without prior specific authorization from the Ofñce of Export Control, for any person:
(1) To apply for, obtain, or use any 11cense, Shipper's Export Declaration, bill of lading, or other export control document relating to an export or reexport of commodi. ties or technical data by, to, or for any person subject to a denial order;
(2). To order; buy, receive, use, sell, deliver, store, dispose of, forward, transport, finance, or otherwise service or participate In, any export from the United States or reexport of any commodity or technical data exported or to be exported from the United States, whereby such person denied export privileges may obtain any benefit therefrom or have any interest therein, directly or indirectly.
A denial order applies not only to the persons or firms named in the order, but also to agents and employees and any other person or firm who may be related to them by ownership, control, position of responsibility or other connection in the conduct of trade or related services. Accordingly, if it is known or suspected that a person or firm is related to a party denied export privileges, even though that person or firm is not listed in the denial order, no export transaction may be consummated with or for such person until approval is received from the Office of Export Control.