U.S. MECHANISMS FOR THE CONTROL OF EXPORTS AND OF TRANSHIPMENTS OF U.S. EXPORTS TO COMMUNIST CHINA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP62-00647A000200070006-8
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 9, 2016
• Document Release Date: July 10, 2000
• Sequence Number: 6
• Content Type: REPORT

Approved For Release 2000/08/23 : CIA-RDP62-00647A000'20&070006-8
U.S. Mechanisms for the Control of Exports and of
Transshipments of U.S. Exports to Communist China
Pre-shipment Control:
1. All direct or indirect shipments from or through the U.S. to
Communist China require validated export licenses. The U.S. policy
is to deny all applications for shipmentsto Communist China.
2. All goods designated by the U.S. to be of primary or secondary strategic
importance require validated licenses for shipment outside the Western
Hemisphere. In addition to careful screening of applications in the
licensing agency (OIT), the U.S. requires on items of primary strategic
importance, assurances from Western European countries against trans-
shipment or shipment of identical items to the Soviet bloc (including
Communist China). When such assurances are not forthcoming, the net
security advantage must be on the side of the U.S. before such shipment
is approved.
For certain problem areas, special assurances are required to assure
against diversion or transshipment to the Soviet bloc. (For example:
(1) the Vienna Screening Committee must pass on U.S. exports to
Austria, (2) A Swiss Blue Import Certificate (Swiss Govt guarantee
against transshipment) is required prior to granting a U.S. Validated
Export License for the shipment of goods to Switzerland, (3) end-use
checks are required in many areas to ascertain that the goods can be
and will be used as specified in the license application).
A 'match List" is maintained in the U.S. licensing agency- of known and
suspected violators of U.S. export control regulations and their
applications are either denied or given very careful scrutiny prior to
approval.
5. When a license is approved for the export of controlled commodites,
the Bill of Lading and Commercial Invoice is stamped with a notice
to all who handle these documents that transshipment or illegal
diversion is in violation of U.S. law.
Customs Procedure:
1. Every commodity exported from the U.S. must be covered by an authenticated
shippers export dellaration. The authentication is executed by a member
of the U.S. Customs Service who checks all pertinent documents against
the actual cargo. In the first 11 months of 1951, 272 seizures of illegal
shipments were made.
Post-Shipment Activities:
1. The OIT post-audits licenses used for the actual export against the
one granted originally to assure a:_'ainst any changes, additions, or other
illegal acts subsequent to granting the license.
*DOC Exempt Letter On File*
Approved For Release 2000/08/23 : CIA-RDP62-00647A000200070006-8
 Approved For Release 2000/08/23 : CIA-RDP62-00647A000200070006-8
-2-
2. Information on possible violations of U.S. export control regulations
is sought abroad by OIT enforcement officers, State Department missions,
and ECA misaions in various foreign countries.
3. In the event of arT illegal activity, enforcement procedures are
invoked. These procedures vary from administrative orders which deny
licensing privileges to both the domestic and foreign firms to
criminal proceedings in serious cases. In 1951, CIT issued 31 charging
letters which resulted in 18 administrative orders denying licensing
privileges and in referral of 7 cases to the Justice Department for
criminal prosecution.
Approved For Release 2000/08/23 : CIA-RDP62-00647A000200070006-8
 Approved For Release 2000/08/23 : CIA-RDP62-00647A0002060?0006-8
U.S. Mechanisms for the Control of Exports and of
Transshipments or Diversions of U.S. Exports to Communist China
Extensive pre-shipment and port of exit procedures seek to insure that
all direct or indirect shipments from or through the United States are
denied to Communist China. In addition to these procedures, special
assurances are required from TrJestern European countries that the U.S. items
exported, or identical items, will not be shipped to the Soviet bloc
(including Corm unist China). When such assurances are not forthcoming,
the net security advantac?e must be on the side of the U.S. before the
license is approved.
After shipment from the United States, certain other procedures are
utilized to insure compliance, including (i) specific notice on the bill of
lading and the commercial invoice that diversion contrary to U.S. law is
prohibited, (2) securing information from OIT enforcement officers, State
Department missions abroad, and ECA missions in various foreign countries
on violations of United States export control regulations, and (3) compliance
proceedings against violators.
Approved For Release 2000/08/23 : CIA-RDP62-00647A000200070006-8