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Missile Proliferation Sanctions on Two North Korean Entities

Thursday, September 24, 2015
Sandler, Travis & Rosenberg Trade Report

The Department of State has determined that two North Korean entities – Korea Mining and Development Corporation and Hesong Trading Corporation – have engaged in missile technology proliferation activities that require the imposition of sanctions pursuant to the Arms Export Control Act and the Export Administration Act of 1979.

As a result, the following sanctions are being imposed for two years on these entities and their sub-units and successors as well as on all activities of the North Korean government (a) relating to the development or production of missile equipment or technology or (b) affecting the development or production of electronics, space systems or equipment, and military aircraft.

- denial of all new individual licenses for the transfer to these entities of all items on the U.S. Munitions List and all items the export of which is controlled under the EAA (this sanction only applies to exports made pursuant to individual export licenses)

- denial of all U.S. government contracts with these entities

- prohibition on imports of all products produced by these entities

The following sanctions will also be imposed against these two entities, also for two years.

- no U.S. departments or agencies may procure or enter into any contract for the procurement of any goods, technology or services from these entities, including the termination of existing contracts

- no U.S. departments or agencies may provide any assistance to these entities or obligate further funds for such purposes

- imports of any goods, technology or services produced or provided by these entities, other than information or informational materials, will be prohibited

- all licenses and other approvals for exports and other transfers of defense articles and defense services from the U.S. to these entities, transfers of U.S.-origin defense articles and defense services from foreign destinations to these entities, and temporary imports of defense articles to or from these entities are suspended

- it is the policy of the U.S. to deny licenses and other approvals for exports and temporary imports of defense articles and defense services destined for these entities

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