Kingston Technology Company - Technology Company Info

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Kingston Technology Company Info

Export Regulations

There are various export regulations which affect the sale of Kingston products. It is the responsibility both of Kingston and of its customers to comply with all regulations which are applicable. These guidance notes are provided purely to assist customers in complying with the regulations of the USA, EU and the UK. It is the responsibility of the customer to verify that they are in compliance with all the relevant regulations, including any other regulations which may be applicable in the customer’s region.

Whilst every care has been taken in preparing these guidance notes, Kingston cannot accept responsibility for any errors or omissions contained herein. The guidance on Export control Classification Numbers (ECCN’s) under the US regulations provided herein is a self classification only, and the information is provided “as is” and Kingston makes no representation or warranty as to the accuracy or reliability of such classifications. Any use of any information provided in these guidance notes by you is without recourse to Kingston and is at your own risk. Kingston is in no way responsible for any damages whether direct, indirect, consequential, incidental, or otherwise, suffered by you as a result of using or relying upon such information. Customers are advised to study the original regulations and seek professional advice to establish the legal position in any specific set of circumstances. Customers should also be aware that the regulations are constantly changing and accordingly should ensure that they take account of any changes as they occur.

Below is a very brief summary of all the export regulations in relation to the sale, directly or indirectly of Kingston products:

Sales of all Kingston products directly or indirectly to Cuba, Iran, North Korea, Sudan and Syria are forbidden. Kingston’s commodities, software, technical data and products may NOT be exported / re-exported, either directly or indirectly, to these embargoed and special controls countries without prior written authorisation from all the relevant authorities.
Sales of products directly or indirectly to an end user or where the end use is involved in the research, design, development, manufacture, construction, operation, production, stockpiling, use, testing or maintenance of certain: nuclear items, missiles, chemical and biological weapons, and maritime nuclear propulsion end-uses in many countries are prohibited. In certain countries any end-use related to any military purpose is also prohibited.
Sales of products directly or indirectly to an end user on the US: Entity list, Denied Persons List or Specially Designated Nationals and Blocked Persons Lists are prohibited.
Kingston cannot participate in supporting international boycotts of certain foreign countries unless such boycotts are sanctioned by the U.S. Government.
No payment or offers of payment can be made to a non-US official to induce that official to influence any government act or decision to assist in obtaining or retaining business associated with the Kingston Group of companies in any way.

A more detailed summary of each of the sets of regulations is given below, together with references to useful websites.

US Export Regulations

The US export regulations apply to products sold by Kingston Technology Europe Limited for various reasons:

Kingston Technology Europe Limited is wholly owned by Kingston Technology Company, Inc. a United States entity.
Many of the products we supply were made in the USA.
If the products were not made in the USA, they are likely to have been made elsewhere by other Kingston group entities, all of which are owned by US persons, sometimes using US origin components, designs and other technology.

As a general rule, the US Export Regulations are similar to or more comprehensive than those of the EU and UK. Thus if one complies with the US Export regulations, it is likely that one is also complying with the EU & UK export regulations. However, if a US licence has been obtained for a specific circumstance, this might not necessarily ensure compliance with any other applicable regulations. Also, the EU can impose sanctions unilaterally which will need to be checked.

Below is a brief description of some key elements of the US export Regulations. These are administered principally by the US Department of Commerce Bureau of Industry and Security (“BIS”). BIS run a very good website for Export Administration Regulations (“EAR”) at:
http://www.access.gpo.gov/bis/index.html

More general guidance can be found at the BIS web site at:
www.bis.doc.gov/index.htm

Alternatively, they may be contacted by telephone on:
BIS Office of Exporter Services (Washington D.C.): (202) 482 4811
BIS Western Regional Office: (949) 660-0144

General Prohibitions – Part 736

There are 10 general prohibitions

Export/re-export of US origin items on the control list to countries indicated as requiring a licence for the control reason applicable to the items. This includes North Korea for certain products.
This extends prohibition 1 to foreign made items with more than a de-minimis US content.
This extends prohibition 1 to foreign made items, produced directly by US technology and software.
Engaging in actions prohibited by a denial order – e.g. dealing with persons included on the Denied Persons List.
Items subject to the EAR, exported/re-exported to an end-user or end-use that is prohibited.
Export/re-export to embargoed or other special controls destinations – these include Cuba, Iran, Sudan and Syria.
Support of proliferation activities
Items which will go in-transit through certain countries.
No violation of any order, licence or licence exception
Proceeding with transactions with knowledge that a violation has occurred or is about to occur.

Commerce Control List – Supplement No. 1 to part 774

These lists classify those controlled items into Export Control Classification Numbers (“ECCN”). The commerce control list includes items that have military use, dual-use and solely civil uses.

Commerce Country Chart – Supplement No 1 to part 738

This lists all the Countries that have some reason for control. If an item has a reason for control on the CCL, the Commerce Country chart indicates whether you need a license for any specific end country.

www.access.gpo.gov/bis/ear/pdf/738spir.pdf

Licence Exceptions – Part 740

The licence Exceptions permit certain exports / re-exports that would otherwise require a licence under General Prohibitions 1,2,3 or 8 above. ECCN 4A994 and 5A992 are, however, not eligible for any Licence Exemptions (such as LVS, GBS, CIV, or CTP) that would permit the export or re-export of any Kingston products to Cuba, Iran, Sudan or Syria or of those restricted parts to North Korea.

Embargoes and Other Special Controls – Part 746

There are embargoes and other special controls on Cuba, Iran, North Korea, Sudan and Syria which prohibit the export and re-export of all Kingston products to those countries without a licence.

www.access.gpo.gov/bis/ear/pdf/746.pdf

The Office of Foreign Assets Control (“OFAC”) in the US Treasury Department also has controls on these countries. OFAC has a website at:

http://www.treas.gov/offices/enforcement/ofac/

Iraq was also subject to these controls, but a general licence has been issued which lifts many of the restrictions. Most controls on Libya have also been lifted in August 2006.

There are certain controls on some other countries, but these are believed not to affect Kingston’s products.

End-User & End-Use based controls – Part 744

This section prohibits the export or re-export of items primarily where the end-user or the end-use is involved in research, design, development, manufacture, construction, operation, production, stockpiling, use, testing or maintenance of certain: nuclear items, missiles, chemical and biological weapons, and maritime nuclear propulsion end-uses in certain countries. The sale of any item for a military end-use is prohibited to any country subject to an arms embargo.

This section also sets out the regulations regarding the Entity list. This is a listing of end-users where the risk of breaching these end-use controls is considered to be too great, and hence exports or re-exports of Kingston products to these entities will require a license.

This section also sets out the regulations on Specially Designated Nationals and Blocked Persons List. This list includes Specially Designated Nationals [FRYM], Specially Designated Terrorists [SDT], Foreign Terrorist Organizations [FTO]. A license requirement applies to all exports and re-exports to an SDT, FTO, and FRYM and generally will be denied.

Denied Persons list – Supplement No. 2 to Part 764

A Transaction is prohibited if a transferee, ultimate end-user, any intermediate consignee or any other party to a transaction is a person denied export privileges. The list of denied persons is available from the BIS website and is frequently updated.

http://www.bis.doc.gov/dpl/thedeniallist.asp

Entity List – Supplement No. 4 to part 744

Transactions involving entities on this list are prohibited. This is a listing by country of entities affected by the end-use prohibitions. Entities in only a few countries appear on the list: China, India, Iran, Israel, Pakistan, Russia, Syria and United Arab Emirates. The entities are listed due to end-use concerns (such as involvement with missiles, nuclear items, chemical and biological weapons)

http://www.access.gpo.gov/bis/ear/pdf/744spir.pdf

Specially Designated Nationals – Supplement No. 3 to part 764

This is a list of persons located in many countries with whom transactions are prohibited mainly because of links with terrorism.

http://www.treas.gov/offices/enforcement/ofac/sdn/t11sdn.pdf

Guidance on Red Flags – Supplement 3 to Part 732

This section gives guidance on how to assess whether a violation has occurred or is about to occur. Also listed are 12 possible indicators “Red flags” that if present, mean that you need to make further enquiries of the customer before proceeding with the transaction. Deliberately, not asking questions and performing the appropriate checks, when the circumstances suggest it is necessary, is deemed to be self-blinding and is not permissible.

www.access.gpo.gov/bis/ear/pdf/732.pdf

The Red Flags given in the supplement (not all of which are applicable to our products) are given below:

The customer or purchasing agent is reluctant to offer information about the end-use of a product.
The product’s capabilities do not fit the buyer’s line of business; for example a small bakery places an order for several high-end workstation modules.
The product ordered in incompatible with the technical level of the country to which the product is being shipped.
The customer has little or no business background
The customer is willing to pay cash for a large order.
The customer is unfamiliar with the product’s performance characteristics but still wants the product.
Routine installation, training or maintenance services are declined by the customer.
Delivery dates are vague, or deliveries are planned for out-of-the-way destinations.
A freight-forwarding firm is listed as the product’s final destination.
The shipping route is abnormal for the product and destination.
Packaging is inconsistent with the stated method of shipment or destination.
When questioned, the buyer is evasive or unclear about whether the purchased product is for domestic use, export or reexport.

BIS has proposed to revise the Red Flag guidance. The proposal represents a significant tightening of the guidance and includes for example: shipments to customers in a free trade zone, customers who may have dealings with embargoed countries, customers with unusual addresses, customer supplies documentation that you suspect is false, etc. The proposed rules can be found at:

http://a257.g.akamaitech.net/7/257/2422/06jun20041800/edocket.access.gpo.gov/2004/pdf/04-22878.pdf

Unverified List

This is a list of persons that if they are a party to a proposed transaction, automatically raises a “Red Flag” as detailed above. The list can be selected from the web page:

http://www.bis.doc.gov/Enforcement/UnverifiedList/unverified_parties.html

Restrictive Trade Practices or Boycotts – Part 760

Kingston is prohibited from participating in or supporting international boycotts of certain foreign countries, including Israel, if such boycotts are not sanctioned by the U.S. Government. Further details can be found at:

www.bis.doc.gov/antiboycottcompliance/default.htm

Transshipment Country Export Control Initiative (TECI)

The US Department of Commerce BIS are looking into the issue of maintaining export controls as goods move through transhipment hubs throughout the world. They have identified some transshipments hubs as being of particular concern and greater care is needed if goods are passing through these hubs. At the time of preparing these notes the transsshipment hubs of concern included: Cyprus, Hong Kong, Malaysia, Malta, Panama, Singapore, Taiwan, Thailand and UAE. An executive summary of TECI activities can be found at:

www.bis.doc.gov/ComplianceAndEnforcement/ExecutiveSummary.html

The Bureau of Industry and Security have issued some best practices for items subject to the Export Administration Regulations. These have been amended following public consultation and the latest version can be viewed at:

http://www.bis.doc.gov/ComplianceAndEnforcement/TECI_BestPractices_Nov03.htm

US Foreign Corrupt Practices Act

No Payment or offer of payment to a foreign official to induce that official to influence any government act or decision to assist in obtaining or retaining business associated with Kingston in any way. Details of this Act can be found from the US Department of Justice website at:

www.usdoj.gov/criminal/fraud/fcpa/

US International Traffic in Arms Regulations (ITAR)

The US Department of State has information on the ITAR Regulations at:

http://pmddtc.state.gov/reference.htm

A list of debarred parties is kept at: http://pmddtc.state.gov/debar059.htm and also at http://www.pmddtc.state.gov/debar_admin.htm and these parties should not be party to any transaction involving Kingston products.

UK Export Regulations

As Kingston Technology Europe Limited is a UK registered Company we are obliged to be in full compliance with the UK export regulations. This means that Kingston cannot ship products directly or indirectly to certain countries / persons without first obtaining all the written consents or authorisations which may be required.

The UK Department of Trade and Industry has a useful website - http://www.dti.gov.uk/europeandtrade/strategic-export-control/index.html This site has links to various other relevant bodies including the European Union, United Nations and the Foreign and Commonwealth Office.

The UK Control list is similar, but not identical to the US Commerce Control list. The UK control list does not contain the wide-ranging US classification 4A994. However, the UK currently has tight controls on exports to various countries including Iran. There are also restrictions on certain end-users and end-uses, very similar to the US Export Regulations.

EU Export Regulations

The European Union website is http://www.europa.eu/index_en.htm. A good deal of information is available on the site. In particular follow the trail: Documents / EUR-Lex / Simple Search / Classification Headings / 18. Common Foreign and Security Policy. This gives a listing of relevant current EU legislation in force.

The main general EU rules are set out in Council Regulation 1334/2000, as amended, which includes a control list of dual-use items. This list does not include contain the wide-ranging US classifications 4A994 or 5A992. However, there is a general prohibition on sales of any dual-use items (even if not on the control list) where the end-user or end-use is associated with nuclear, biological or chemical weapons. Items for use in any sort of military item is also prohibited to any country subject to an arms embargo.

There are also a large number of other regulations dealing mainly with specific countries or items.

Updated: 2 October 2007

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