Bureau of Industry and Security (BIS Compliance)
The United States Department of Commerce’s Bureau of Industry and Security (BIS)—formerly known as the Bureau of Export Administration—is responsible for administering and enforcing export controls on U.S. commercial products, software and technology. BIS also is responsible for overseeing export controls on “dual-use” items that can be used in weapons of mass destruction applications, terrorist activities or human rights abuses.
BIS Restricted Party Lists
In addition to enforcing the Export Administration Regulations (EAR), BIS compliance administers several restricted party lists that apply to export and reexport transactions. These lists, which change frequently, include:
- BIS Denied Persons List
The BIS Denied Persons List includes the names of individuals and companies that have been denied export privileges by BIS, usually due to a violation of U.S. export control laws. U.S. persons and companies are generally prohibited from engaging in export transactions with parties named on the Denied Persons List.
- BIS Entity List
The BIS Entity List identifies the names of companies, individuals, government agencies and research institutions that trigger export and reexport license requirements. U.S. companies need to ensure that the appropriate export licenses are in place before proceeding with transactions with parties on the BIS Entity List.
- BIS Unverified List
This list includes the names of foreign parties that BIS have been unable to conduct a pre-license check or post-shipment verification. Potential transactions with parties on the Unverified List are a “red flag” that must be addressed and resolved before proceeding with the export.
You could face significant civil and criminal fines and other penalties if you or your company engages in prohibited transactions with parties included on the Denied Persons and Entity Lists. Civil penalties can also be imposed on export transactions with such parties even if such activity occurred inadvertently.
Developing an Effective Export Compliance Program
BIS has issued guidelines on how to develop effective export compliance programs. For restricted party list screening, the BIS compliance guidelines state:
Internal procedures and controls should be implemented to systematically detect sanctioned persons and entities prior to engaging in exports, reexports and other activities that are prohibited or require licenses by BIS and other U.S. Government agencies.
When developing sanction screening procedures, consider persons and entities beyond the customer and end-user, including suppliers, freight forwarders, agents and other parties involved in international transactions.
Screening Goods and Technology Transactions
Depending on the nature of a company’s business, there are two basic techniques for screening transactions involving the export of goods and technology:
- Customer-based method: customers are routinely screened against the restricted party lists and company maintains database of approved customers.
- Transaction-based method: company screens each order received at various times in the sales process, including upon receipt of the order and prior to shipment.
The restricted party screening process can be clearly documented to ensure you have an effective export compliance program, which meets BIS compliance obligations with CSI Watch List Solutions. Contact CSI today to learn more about sanctions screening solutions that automate searching government issued restricted party lists.