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Major Kris Eggehorn Agreements Analyst Directorate of Defense Trade Controls Licensing Electronic Agreements Concepts and Processes U.S. Department of.

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Presentation on theme: "Major Kris Eggehorn Agreements Analyst Directorate of Defense Trade Controls Licensing Electronic Agreements Concepts and Processes U.S. Department of."— Presentation transcript:

1 Major Kris Eggehorn Agreements Analyst Directorate of Defense Trade Controls Licensing Electronic Agreements Concepts and Processes U.S. Department of State 12/8/09

2 Provide an Introduction to the Electronic Agreements Process 2 Purpose

3 Agenda Overview –Summary of Changes –Benefits Preparation and Submission –Agreements Required Entries –Amendments/Re-Baselines Required Entries Example Submission Approvals – What to Expect Post Approval Actions Current Trends 3

4 Directed by NSPD 56 –January 22, 2008 (Provide a means for industry to submit agreement proposals electronically) Utilizes the D-Trade 2 System to submit proposals Therefore, available to only those companies with digital certificates Submission accomplished on a DSP-5 application Serves only as a vehicle for transitioning the proposal throughout the process Attached Transmittal Letter and Agreement/Amendment is still the primary focus of review by the Agreements Officer Issuance of the DSP-5 vehicle is simply the mechanism for providing the DDTC position on the agreement and not an authorization 4 Overview

5 Overview (cont) The following statement will be applied to all agreements adjudicated through the electronic process: The issuance of the subject DSP-5 does not grant any export rights or privileges, and its related DSP-5 case number may not be cited as an authorization or used as the basis for an exemption. The Department of State approves the proposed agreement/ amendment as attached subject to the following limitations, provisos and requirements. The agreement or amendment may not enter into force until the agreement/amendment has been signed and the stated requirements have been satisfied. 5

6 Summary of Changes Case ID-of-Record 9-digits vice 6-digits –Sequential amendments to have unrelated IDs, but searchable –Check status on Ellie and Elisa Net using 9-digit DSP-5 number Attachments provided during initial submission restricted to 35 MB in total size –If size of all files combined exceeds 35 MB, then upload Transmittal Letter, Proposed Agreement, Certification Letter and Positive Part 130 only on initial submission –Additional supporting documents to be uploaded after 9-digit ID applied –Keep attachments to the agreement/amendment within the same pdf document Overview (cont) 6

7 Separate Certification Letter no longer required –Provided DSP-5 vehicle is certified by the Empowered Official –…And no previous violations Separate Approval Letter no longer issued by DDTC –Revised and classified letters are the exception Amendments must be submitted as complete/conformed documents –Bold Changes –Address summary of changes in proposed amendment Whereas Clauses –Minor amendments do not need to be conformed and are loaded into the most recently approved case Overview (cont) Summary of Changes 7

8 First-time submissions in D-Trade 2 must be Re-baselined –Required to establish DTC baseline of provisos –Only electronic agreements will be eligible for electronic amendments Approvals cite all active/current provisos –If revised, annotated in Bold; states Revised in parenthesis –No longer relevant – states Proviso Rescinded in parenthesis Proviso Reconsiderations Submitted as Major Amendments –Complete DSP-5 Vehicle required –Attachments consist of the same documents currently required for a paper reconsideration, i.e., General Correspondence Letter and Certification Letter, if applicable Overview (cont) 8

9 Benefits Reduced processing time – Submission – Adjudication Processing – Issuance Elimination of hard-copy approval letters – Revised and Classified Letters are the exception Eliminates: – 3:00 pick-ups – 15-or-more party disks Reduces Paper Copy processing costs (Toner, paper, Fed Ex costs, binder clips, etc.) Overview (cont) 9

10 Minimizes risk of lost cases ( I dont see my case in DETRA yetsent it in over a month ago…) Provides all active/current provisos for amendments ( Reduces potential for conflicting guidance) Option to upload data after-the-fact – During Adjudication – Additional supporting documentation; Missing documentation – After Approval – Executed Copies, Notification of Initial Export; Minor Amendments; Sales Reports; DSP-83s, etc. Overview (cont) Benefits 10

11 Preparation and Submission Step No. BlockApplicant Action 1n/aAccess the DDTC Website at 2n/aClick on D-Trade 3n/aClick on D-Trade 2 Log-in and open up a DSP-5 4n/aInput Transaction Number – to prevent an unnecessary delay in processing the Agreement, the Number MUST be preceded by AG- followed by the applicants internal code (e.g. AG-M32509A) No Spaces 5n/aAttach documents per Section 17.1 of the Guidelines for Preparing Agreements (35 MB limit) 6n/aOpen up DSP-5 72Type your registration code 83Select countr(ies) of ultimate destination (must equal Block 14) 94Type Not Required 105Fill in applicants information 116Type in information if applicable 127Type in data on Applicant Points of Contact Agreements 11

12 Preparation and Submission (cont) Step No. BlockApplicant Action 138aFor basic agreement submissions, click ONLY completely new shipment and skip to Step bComplete, if applicable 158cLeave blank for new agreements 168dClick on the appropriate item and provide information as necessary and hit return. Must be consistent with Paragraph (a)(7) in Transmittal Letter 178eClick Yes or No and provide Compliance Disclosure Number if applicable 189Type 1 in Quantity and select Lots for Unit Type 1910Type in agreement type (e.g. TAA, MLA, WDA), concise description of commodity(ies), SME status (e.g. No SME), highest level of classification of data/articles/services to be exported, all USML categories, and Total Agreement Value Agreements 12

13 Step No. BlockApplicant Action 2010For Defense Article Type, always select Technical Data 2111Fill in primary USML Category Number (based on tech data being exported). If prompted to provide information on DSP-83, provide required explanation (e.g. To be forwarded with concluded agreement) 2212For agreement submissions, input total value of agreement 23n/aClick on Add to open up the Additional Commodities page. This will be used to identify whether all documentation is attached to the initial submission 249In Line Item #2 type 1 in Quantity and select Lots for Unit Type (Same as Item 1) 2510Type All Documents Uploaded if all documents will be uploaded with initial submission. Type Additional Documentation to be Uploaded if more documents will be added after the initial submission (i.e. files in excess of 35 MB total) 2610For Defense Article Type, always select Technical Data (Same as Item 1) 2711Fill in primary USML Category Number (Same as Item 1) 2812Enter $1 for Value Preparation and Submission (cont) Agreements 13

14 Step No. BlockApplicant Action 2914Provide name and address of foreign licensees 3015Select Same as Block List all foreign sublicensees. If none, enter No Sublicensees in the name block, N/A in address blocks, and the primary country of transaction in the country box. 3217Select Same as Block List countries of TCN/DNs and Sales Territories. For example: Name – Third Country Nationals Address – TCN City – TCN Country – BR Role – TCN For Sales, Marketing or Distribution: Name – Sales/Distribution/Marketing Territory Address – Sales, Marketing or Distribution City – Sales, Marketing or Distribution Country – BR Role – Sales, Marketing or Distribution 3419 Select Same as Block 5 Preparation and Submission (cont) Agreements 14

15 Step No. BlockApplicant Action 3520 Check items as applicable. At a minimum, this block should include a concise narrative describing the purpose of the submission, agreement objectives, as well as any other information DDTC would deem significant, such as pending submissions. Narrative should be derived from the Transmittal Letter Background entry for agreements, and from the Original Purpose of the Agreement and Relationship to Original Approval entries rebaseline. If requesting third country nationals, state this here. 3621List all U.S. signatories. Check Same as Block 5 if applicable 3722Check the appropriate and Part 130 blocks 38n/aForward submission to DDTC 39n/a(If Needed) Once D-Trade 2 generates a nine-digit 05 identification number, attach any additional documents (if needed) per Section 17.2 of the Guidelines for Preparing Agreements Preparation and Submission (cont) Agreements 15

16 Preparation and Submission Step No. BlockApplicant Action 1n/aAccess the DDTC Website at 2n/aClick on D-Trade 3n/aClick on D-Trade 2 Log-in and open up a DSP-5 4n/aInput Transaction Number – to prevent an unnecessary delay in processing the Amendment/Re-baseline, the Number MUST be preceded by AG- followed by the applicants internal code (e.g. AG- M32509A) No Spaces 5n/aAttach documents per Section 17.1 of the Guidelines for Preparing Agreements 6n/aOpen up DSP-5 72Type your registration code 83Select countr(ies) of ultimate destination (must equal Block 14) 94Type Not Required 105Fill in applicants information 116Type in information if applicable 127Type in data on Applicant Points of Contact Amendments/Re-Baselines 16

17 Preparation and Submission (cont) Step No. BlockApplicant Action 138aFor amendment/re-baseline submissions, click ONLY the unshipped balance under the license numbers and then click on Enter license numbers. Fill in the last approved amendment/basic agreement in Block A and hit return 148bComplete, if applicable 158cFor amendment/re-baseline submissions, click This application is in reference to an agreement and then click Enter Agreement numbers. Fill in all previous amendment and basic agreement numbers in Block C and hit return 168dClick on the appropriate item and provide information as necessary and hit return. Must be consistent with Paragraph (a)(7) in Transmittal Letter 178eClick Yes or No and provide Compliance Disclosure Number if applicable 189Type 1 in Quantity and select Lots for Unit Type 1910Type in amendment/re-baseline type (e.g. TAA, MLA, WDA), concise description of commodity(ies), SME status (e.g. No SME), highest level of classification of data/articles/services to be exported, all USML categories, and Total Agreement Value Amendments/Re-Baselines 17

18 Step No. BlockApplicant Action 2010For Defense Article Type, always select Technical Data 2111Fill in primary USML Category Number (based on tech data being exported). If prompted to provide information on DSP-83, provide required explanation (e.g. To be forwarded with concluded agreement) 2212For amendment submissions, input requested increase only; if no value increase or proviso reconsideration, enter $1 23n/aClick on Add to open up the Additional Commodities page. This will be used to identify whether all documentation is attached to the initial submission 249In Line Item #2 type 1 in Quantity and select Lots for Unit Type (Same as Item 1) 2510Type All Documents Uploaded if all documents will be uploaded with initial submission. Type Additional Documentation to be Uploaded if more documents will be added after the initial submission (i.e. files in excess of 35 MB total) 2610For Defense Article Type, always select Technical Data (Same as Item 1) 2711Fill in primary USML Category Number (Same as Item 1) 2812Enter $1 for Value Preparation and Submission (cont) Amendments/Re-Baselines 18

19 Step No. BlockApplicant Action 2914Provide name and address of foreign licensees 3015Select Same as Block List all foreign sublicensees. If none, enter No Sublicensees in the name block, N/A in address blocks, and the primary country of transaction in the country box. 3217Select Same as Block List countries of TCN/DNs and Sales Territories. For example: Name – Third Country Nationals Address – TCN City – TCN Country – BR For Sales, Marketing or Distribution: Name – Sales/Distribution/Marketing Territory Address – Sales, Marketing or Distribution City – Sales, Marketing or Distribution Country – BR 3419Select Same as Block 5 Preparation and Submission (cont) Amendments/Re-Baselines 19

20 Step No. BlockApplicant Action 3520Check items as applicable. At a minimum, this block should include a concise narrative describing the purpose of the submission, amendment objectives, as well as any other information DDTC would deem significant, such as pending submissions. Narrative should be derived from the Transmittal Letter Original Purpose of the Agreement and Relationship to Original Approval entries for amendments/re- baselines. 3621List all U.S. signatories. Check Same as Block 5 if applicable 3722Complete, as required 38n/aForward submission to DDTC 39n/a(If Needed) Once D-Trade 2 generates a nine-digit 05 identification number, attach supporting material documents per Section 17.2 of the Guidelines for Preparing Agreements Preparation and Submission (cont) Amendments/Re-Baselines 20

21 Example DSP-5 Vehicle 21 AFAS Technical Assistance Agreement –Related to the sale of the Search and Finder Radar for the Australian DOD –Includes request for TCNs and Sublicensees Transmittal Letter and Agreement completed as normal Open up DSP-5 on our website

22 Example DSP-5 Vehicle (cont) 22

23 Example DSP-5 Vehicle (cont) 23

24 Example DSP-5 Vehicle (cont) 24

25 Example DSP-5 Vehicle (cont) 25

26 Example DSP-5 Vehicle (cont) Additional Commodities 26 2 Additional Documentation to be Uploaded 1 1 Remember 35 MB Total Document Size Limit

27 Example DSP-5 Vehicle (cont) 27 List all Foreign Licensees to the Agreement - Click on Add to include more List all Sublicensees - Click on Add to include more. If no sublicensees, enter No Sublicensees in the name block, with none or N/A in the address blocks, and the primary foreign country of the transaction in the country box List all Third Country/ Dual Nationals/Sales/Distribution/ Marketing Territory here. DO NOT list countries here, but include these countries in Block 20 List all U.S. Signatories. If only you, check Same as Block 5 U.S. Sublicensees and U.S. End Users do not need to be identified in DSP-5 Concise Narrative of agreement to include TCN requests

28 Example DSP-5 Vehicle (cont) 28 Almost Done! Check the appropriate statement Check the appropriate Part 130 statement Digitally signed by an Empowered Official Upload any additional documents as necessary after you receive your nine- digit DSP-5 ID number. Remember to let us know in the Commodity field.

29 Approvals – What to Expect DSP-5 valid for 48 months –Disregard DSP-5 validity dateit is just the vehicle. Proviso #1 addresses the agreement duration Revised Preamble to approval letter –If classified or congressionally notified, permanently retained proviso is identified in preamble Approvals cite all active/current provisos –If revised, annotated in Bold; states Revised in parenthesis –No longer relevant – states Proviso Rescinded in parenthesis –Actions completed from previous proviso direction will be changed toComplied With 29

30 Post Approval Actions Read the Provisos and ensure they are adhered to! Problem with provisos? –Call the Agreement Officer –Contact the Response Team –Submit a Proviso Reconsideration Request Proceed with Execution Post-approval documents uploaded to D-Trade 2 –Executed agreements/amendments; Termination letters; Minor amendments; Sales reports; DSP-83s, etc. –If its not there, you didnt provide it! 30

31 Current Trends Most common issues: –Failure to add AG- to Trans-ID upon submission o Result – Up to five day delay in processing –Failure to include all Foreign Signatories or Foreign Sub-licensees in Blocks 14 and 16 (Foreign End Users and Foreign Consignees) o Result – Applicant directed to remove parties –Failure to address third country nationals, sales territories, marketing territories in Block 18 (Foreign Intermediate Consignees) o Result – May result in direction to remove –Incorrectly identifying uploaded documents in accordance with Sections 17.1, 17.2 of the Guidelines o Result – Slows down DDTC review 31

32 Way Ahead September 1, 2010 – Projected date for elimination of paper agreement/amendment submissions –Electronic agreement submissions only What do you need to do? Get your Digital Certificate NOW! Submit one to make sure it clears DDTC before submitting more! 32


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