On 26 September 2023, the US Bureau of Industry and Security (“BIS”) announced that the “Five Eyes” countries (Australia, Canada, New Zealand, the United Kingdom and the United States) issued joint guidance (“Five Eyes Guidance”) identifying high priority items critical to Russian weapons systems and urging specific actions to prevent diversion of these items to Russia through third countries. This comes just a few months after the Five Eyes countries established a coordinated effort on export control enforcement, with a particular emphasis on the export controls targeting Russia and Belarus. Our previous blog post on the establishment of this partnership can be found here.
The Five Eyes Guidance provides a list of prioritized Harmonized System (HS) codes identifying items Russia needs for its weapons systems. This list aligns with similar efforts by the United States, United Kingdom, European Union, and Japan, which was also updated in September. Our previous blog post on that effort can be found here. On 28 September 2023, BIS issued a best practices guidance document recommending that exporters and reexporters of these highest priority items seek written assurances of compliance from their customers to help prevent diversion. The guidance document provides a sample certification form exporters can use to assure parties involved in transactions of the high-priority items are in compliance with US export control laws.
The Five Eyes Guidance also identifies anomalous patterns associated with importers in countries outside of the Global Export Control Coalition (“GECC”) that may raise diversion concerns, due diligence tips for screening such parties (with a focus on customers established after the war in Ukraine began in February 2022), and red flag indicators that may be relevant to exporters to assist in determining whether an activity may be connected to export control and/or sanctions evasion. The GECC is the 39-member global coalition that has implemented substantially similar controls in response to Russia’s invasion of Ukraine.
Multinational companies should assess whether their export compliance programs take into account the Five Eyes Guidance and similar publications from BIS and allied governments. This can include conducting proper due diligence on end users and addressing red flag indicators. Companies that sell and ship products covered by the HS codes in the Five Eyes Guidance should be on particularly high alert for possible red flags indicating that the items could be diverted to Russia. It is possible, and perhaps likely, that this list of covered HS codes will be expanded in the future.
The authors acknowledge the assistance or Ryan Orange with the preparation of this blog post.
