Office of Foreign Assets Control, Treasury § 592.101

States, its departments, agencies, or enti- 592.306 Importing authority. ties, its officers, employees, or agents, or 592.307 Kimberley Process Certificate. any other person. 592.308 Participant. Sec. 13. This order is effective at 12:01 a.m. 592.309 Person. eastern daylight time on March 9, 2015. 592.310 Rough . 592.311 . THE WHITE HOUSE, 592.312 United States person; U.S. person. March 8, 2015 Subpart D—Interpretations ANNEX 592.401 Reference to amended sections. 1. Antonio Jose´ Benavides Torres [Com- 592.402 Effect of amendment. mander of the Central Integral Strategic 592.403 Transshipment or transit through Defense Region of the National Armed the United States. Forces, former Director of Operations for 592.404 Importation into or release from a the National Guard; born June 13, 1961] bonded warehouse or foreign trade zone. 2. Gustavo Enrique Gonza´ lez Lo´ pez [Director General of the National Intelligence Subpart E—Records and Reports Service and President of the Strategic Center of Security and Protection of the 592.501 Records and reports. Homeland; born November 2, 1960] 592.502 Annual reports by rough diamond 3. Justo Jose´ Noguera Pietri [President of importers and exporters. the Venezuelan Corporation of Guayana, former General Commander of the Na- Subpart F—Penalties tional Guard; born March 15, 1961] 592.601 Penalties. 4. Katherine Nayarith Haringhton Padron 592.602 Prepenalty notice. [National Level Prosecutor of the 20th 592.603 Response to prepenalty notice; infor- District Office of the Public Ministry; mal settlement. born December 5, 1971] 592.604 Penalty imposition or withdrawal. 5. Manuel Eduardo Pe´rez Urdaneta [Director 592.605 Administrative collection; referral of the National Police; born May 26, 1962] to United States Department of Justice. 6. Manuel Gregorio Bernal Martı´nez [Chief of the 31st Armored Brigade of Caracas, Subpart G—Procedures former Director General of the National Intelligence Service; born July 12, 1965] 592.701 Procedures. 7. Miguel Alcides Vivas Landino [Inspector 592.702 Delegation by the Secretary of the General of the National Armed Forces, Treasury. former Commander of the Andes Integral Strategic Defense Region of the National Subpart H—Paperwork Reduction Act Armed Forces; born July 8, 1961] 592.801 Paperwork Reduction Act notice. PART 592—ROUGH AUTHORITY: 3 U.S.C. 301; 31 U.S.C. 321(b); CONTROL REGULATIONS Pub. L. 108–19, 117 Stat. 631 (19 U.S.C. 3901– 3913); E.O. 13312, 68 FR 45151 3 CFR, 2003 Comp., p. 246. Subpart A—Relation of This Part to Other Laws and Regulations SOURCE: 69 FR 56938, Sept. 23, 2004, unless otherwise noted. Sec. 592.101 Relation of this part to other laws Subpart A—Relation of This Part to and regulations. Other Laws and Regulations Subpart B—Prohibitions § 592.101 Relation of this part to other 592.201 Prohibited importation and expor- laws and regulations. tation of any rough diamond; permitted This part is separate from, and inde- importation and exportation of any pendent of, the other parts of this rough diamond. 592.202 Evasions; attempts; conspiracies. chapter, with the exception of part 501 of this chapter, the recordkeeping and Subpart C—General Definitions reporting requirements and procedures of which apply to this part. Actions 592.301 Controlled through the Kimberley taken pursuant to part 501 of this chap- Process Certification Scheme. 592.302 Effective date. ter with respect to the prohibitions 592.303 Entity. contained in this part are considered 592.304 Exporting authority. actions taken pursuant to this part. 592.305 Importation into the United States. Differing foreign policy and national

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security circumstances may result in § 592.202 Evasions; attempts; conspir- differing interpretations of similar lan- acies. guage among the parts of this chapter. (a) Notwithstanding the existence of No license or authorization contained any rights or obligations conferred or in or issued pursuant to those other imposed by any contract entered into parts authorizes any transaction pro- or any license or permit granted prior hibited by this part. No license or au- to July 30, 2003, any transaction by a thorization contained in or issued pur- United States person anywhere, or any suant to any other provision of law or transaction that occurs in whole or in regulation authorizes any transaction part within the United States, on or prohibited by this part. after the effective date that evades or avoids, or has the purpose of evading or Subpart B—Prohibitions avoiding, or attempts to violate, any of the prohibitions set forth in this part § 592.201 Prohibited importation and is prohibited. exportation of any rough diamond; (b) Notwithstanding the existence of permitted importation or expor- tation of any rough diamond. any rights or obligations conferred or imposed by any contract entered into (a) Except to the extent provided in or any license or permit granted prior paragraph (b) of this section, and not- to July 30, 2003, any conspiracy formed withstanding the existence of any to violate any of the prohibitions of rights or obligations conferred or im- this part is prohibited. posed by any contract entered into or any license or permit granted prior to the effective date, the importation Subpart C—General Definitions into, or exportation from, the United § 592.301 Controlled through the Kim- States on or after July 30, 2003, of any berley Process Certification rough diamond, from whatever source, Scheme. is prohibited, unless the rough diamond (a) Except as otherwise provided in has been controlled through the Kim- paragraph (b) of this section, the term berley Process Certification Scheme. controlled through the Kimberley Process (b) The prohibitions in paragraph (a) Certification Scheme refers to the fol- of this section regarding the importa- lowing requirements that apply, as ap- tion into, or exportation from, the propriate, to the importation into the United States of any rough diamond United States from a Participant, or to not controlled through the Kimberley the exportation from the United States Process Certification Scheme do not to a Participant, of any shipment in- apply to an importation from, or expor- cluding any rough diamond: tation to, any country with respect to (1) Kimberley Process Certificate. A which the Secretary of State has shipment of rough diamonds imported granted a waiver pursuant to section into, or exported from, the United 4(b) of the States must be accompanied by an (Pub. L. 108–19) and section 2(a)(i) of original Kimberley Process Certificate. Executive Order 13312. The certificate must be presented in NOTE TO § 592.201. An importation of any connection with an importation or ex- rough diamond from, or an exportation of portation of rough diamonds if de- any rough diamond to, a non-Participant is manded by United States customs offi- not controlled through the Kimberley Proc- cials. Pursuant to 31 CFR §§ 501.601 and ess Certification Scheme and thus is not per- mitted, except in the following cir- 501.602, the person identified as the ul- cumstance. The Secretary of State may, pur- timate consignee (see Customs Direc- suant to section 4(b) of the Clean Diamond tive 3550–079A) on the Customs Form Trade Act, waive the prohibitions contained 7501 Entry Summary or its electronic in section 4(a) of that Act with respect to a equivalent filed with U.S. Customs and particular country for periods of not more Border Protection in connection with than one year each. The Secretary of State an importation of rough diamonds will publish a notice in the FEDERAL REG- ISTER identifying any country with respect must retain the original Kimberley to which a waiver applies and specifying the Process Certificate for a period of at relevant time period during which the waiver least five years from the date of impor- will apply. tation and must make such certificate

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available for examination upon de- plete commodity shipment data when mand. such data have been accepted by the (2) Tamper-resistant container. A ship- system. ment of rough diamonds imported into, (b) The Secretary of State, consistent or exported, from the United States with section 3(2)(B) of the Clean Dia- must be sealed in a tamper-resistant mond Trade Act (Pub. L. 108–19), may container; modify the requirements set forth in (3) Notification requirements for impor- paragraph (a) of this section upon mak- tations into the United States. The per- ing a determination that a Participant son identified as the ultimate con- has established an alternative system signee (see Customs Directive 3550– of control for rough diamonds that 079A) on the Customs Form 7501 Entry meets substantially the standards, Summary or its electronic equivalent practices, and procedures of the Kim- filed with U.S. Customs and Border berley Process Certification Scheme. Protection in connection with an im- NOTE 1 TO § 592.301. The Secretary of State portation of rough diamonds must re- will periodically publish in the FEDERAL port that person’s receipt of a ship- REGISTER an up-to-date listing of all Partici- ment of rough diamonds to the rel- pants and their importing and exporting au- evant foreign exporting authority thorities. Where appropriate, such listing within 15 calendar days of the date also will describe any modification of the re- that the shipment arrived at the U.S. quirements set forth in paragraph (a) of this port of entry. The report must refer to section. the relevant Kimberley Process Certifi- NOTE 2 TO § 592.301. Pursuant to 31 CFR §§ 501.601 and 501.602, the recordkeeping and cate by its unique identifying number; reporting requirements imposed by § 592.501 specify the number of parcels in the apply to all U.S. persons engaged in the im- shipment; specify the total carat portation into, or exportation from, the weight of the shipment; and identify United States of any shipment of rough dia- the importer and exporter of the ship- monds. ment. The report need not be in any NOTE 3 TO § 592.301. Effective November 1, particular form and may be submitted 2004, customs brokers, importers, and filers electronically or by mail or courier; making entry of a shipment of rough dia- monds must either submit through U.S. Cus- and toms’ Automated Broker Interface (ABI) sys- (4) Validation of Kimberley Process Cer- tem the unique identifying number of the tificate for exportations from the United Kimberley Process Certificate accompanying States. With respect to the exportation the shipment or, for non-ABI entries, indi- of rough diamonds from the United cate the certificate number on the Customs States and regardless of the destina- Form 7501 Entry Summary at each entry tion, the U.S. Census Bureau requires line. the filing of export information NOTE 4 TO § 592.301. As of May 21, 2008, any diamond, regardless of value, that is de- through the Automated Export Sys- scribed in subheadings 7102.10, 7102.21 or tem. Submission of export information 7102.31, Harmonized Tariff Schedule of the through the Automated Export System United States and is imported into the must be done in advance and must be United States shall not be released from the confirmed by the return of an Internal custody of U.S. Customs and Border Protec- Transaction Number. The return to the tion (CBP) except by a formal entry for con- filer of the Internal Transaction Num- sumption, as defined in § 141.0a(f) of the CBP ber shall constitute the validation of regulations. See 19 CFR 141.0a(f). the Kimberley Process Certificate for [69 FR 56938, Sept. 23, 2004, as amended at 73 an exportation of rough diamonds from FR 29433, May 21, 2008] the United States to a Participant. The exporter is required to report the Inter- § 592.302 Effective date. nal Transaction Number on the Kim- The term effective date refers to the berley Process Certificate accom- effective date of the applicable prohibi- panying any exportation from the tions and directives contained in this United States. The Internal Trans- part as follows: action Number is a unique confirma- (a) With respect to all provisions of tion number generated by the Auto- this part except for § 592.301(a)(3), 12:01 mated Export System to the filer who a.m., eastern daylight time, July 30, provides in a timely manner the com- 2003; and

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(b) With respect to § 592.301(a)(3), Sep- that an English translation is incor- tember 23, 2004. porated: (a) The title ‘‘Kimberley Process Cer- § 592.303 Entity. tificate’’ and the statement: ‘‘The The term entity means a partnership, rough diamonds in this shipment have association, trust, joint venture, cor- been handled in accordance with the poration, or other organization. provisions of the Kimberley Process Certification Scheme for rough dia- § 592.304 Exporting authority. monds’’; (a) The term exporting authority (b) Country of origin for shipment of means one or more entities designated parcels of unmixed (i.e., from the same) by a Participant from whose territory origin; a shipment of rough diamonds is being NOTE TO PARAGRAPH (b): A shipment in- exported as having the authority to cluding a parcel of mixed-origin rough dia- validate the Kimberley Process Certifi- monds is to be entered into the United cate. States with the Kimberley Process Certifi- (b) The exporting authority for the cate accompanying the shipment, and the United States is the U.S. Bureau of the certificate need not indicate the countries of Census. origin of the diamonds. With respect to such a shipment, the country-of-origin field on NOTE TO § 592.304. The Secretary of State the certificate must be filled in with aster- will periodically publish in the FEDERAL isks. The shipment must, however, still com- REGISTER an up-to-date listing of the export- ply with all other country-of-origin report- ing authorities of all Participants. ing requirements imposed by statute or regu- lation. § 592.305 Importation into the United (c) Unique numbering with the Alpha States. 2 country code, according to ISO 3166– The term importation into the United 1; States means the bringing of goods into (d) Date of issuance; the United States. (e) Date of expiry; § 592.306 Importing authority. (f) Name of issuing authority; (g) Identification of exporter and im- (a) The term importing authority porter; means one or more entities designated (h) Carat weight/mass; by a Participant into whose territory a (i) Value in U.S. dollars; shipment of rough diamonds is being (j) Number of parcels in the ship- imported as having the authority to ment; enforce the laws and regulations of the Participant regulating imports, includ- (k) Relevant Harmonized Commodity ing the verification of the Kimberley Description and Coding System; and Process Certificate accompanying the (l) Validation by the exporting au- shipment. thority. (b) The importing authorities for the NOTE TO PARAGRAPH (l): See § 592.301(a)(4) United States are the U.S. Bureau of for procedures governing the validation of Customs and Border Protection or, in the Kimberley Process Certificate when ex- the case of a territory or possession of porting from the United States. the United States with its own customs administration, analogous officials. § 592.308 Participant. The term Participant means a state, NOTE TO § 592.306. The Secretary of State will periodically publish in the FEDERAL customs territory, or regional eco- REGISTER an up-to-date listing of the import- nomic integration organization identi- ing authorities of all Participants. fied by the Secretary of State as one for which rough diamonds are con- § 592.307 Kimberley Process Certifi- trolled through the Kimberley Process cate. Certification Scheme.

The term Kimberley Process Certificate NOTE TO § 592.308. The Secretary of State means a tamper- and forgery-resistant will periodically publish in the FEDERAL document that bears the following in- REGISTER an up-to-date listing of all Partici- formation in any language, provided pants.

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§ 592.309 Person. § 592.403 Transshipment or transit The term person means an individual through the United States. or entity. The prohibitions in § 592.201 apply to the importation into, or exportation § 592.310 Rough diamond. from, the United States, for trans- The term rough diamond means any shipment or transit, of any rough dia- diamond that is unworked or simply mond intended or destined for any sawn, cleaved, or bruted and classifi- country other than the United States, able under subheading 7102.10, 7102.21, unless the shipment is sealed in a tam- or 7102.31 of the Harmonized Tariff per-resistant container, accompanied Schedule of the United States. by a Kimberley Process Certificate, and leaves the United States in the § 592.311 United States. identical state in which it entered. The The term United States, when used in validation, recordkeeping, and report- the geographic sense, means the sev- ing procedures applicable to importa- eral States, the District of Columbia, tions and exportations do not apply in and any commonwealth, territory, or this case. possession of the United States. § 592.404 Importation into or release § 592.312 United States person; U.S. from a bonded warehouse or for- person. eign trade zone. The term United States person or U.S. The requirements of the Kimberley person means any United States cit- Process Certification Scheme apply to izen; any alien admitted for permanent all imported shipments of a rough dia- residence into the United States; any mond, regardless of whether they are entity organized under the laws of the destined for entry into, or withdrawal United States or any jurisdiction with- from, a bonded warehouse or a foreign in the United States (including its for- trade zone of the United States. eign branches); or any person in the United States. Subpart E—Records and Reports

Subpart D—Interpretations § 592.501 Records and reports. For provisions relating to required § 592.401 Reference to amended sec- records and reports, see part 501, sub- tions. part C, of this chapter. Recordkeeping Except as otherwise specified, ref- and reporting requirements imposed by erence to any provision in this part or part 501 of this chapter with respect to chapter or to any other regulation re- the prohibitions contained in this part fers to the same as currently amended. are considered requirements arising pursuant to this part. § 592.402 Effect of amendment. Unless otherwise specifically pro- § 592.502 Annual reports by rough dia- vided, any amendment, modification, mond importers and exporters. or revocation of any provision in or ap- (a) Requirement for reports. Reports pendix to this part or chapter or of any shall be filed annually, by April 1 of order, regulation, ruling, or instruction each year, covering the preceding cal- issued by or under the direction of the endar year (January 1–December 31), Director of the Office of Foreign Assets except the first annual report, covering Control does not affect any act done or the period January 1–December 31, 2007, omitted, or any civil or criminal suit shall be filed by September 1, 2008. or proceeding commenced or pending (b) Who must report; reporting period. prior to such amendment, modifica- All persons who import rough dia- tion, or revocation. All penalties, for- monds into the United States or export feitures, and liabilities under any such rough diamonds from the United States order, regulation, ruling, or instruction during the reporting period (January 1– continue and may be enforced as if December 31). such amendment, modification, or rev- (c) What must be reported. The report ocation had not been made. need not be in any specified format but

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must include the following informa- than 10 years, or both; and any officer, tion: director, or agent of any corporation (1) The contact information of the who willfully participates in such vio- U.S. importer or exporter, including lation may be punished by a like fine, name, address, telephone number, fax imprisonment, or both; and number, and e-mail address; (3) Those customs laws of the United (2) Identification of total import and/ States, both civil and criminal, includ- or export activity for each of the three ing those laws relating to seizure and Harmonized Tariff Schedule classifica- forfeiture, that apply to articles im- tions of rough diamonds during the re- ported in violation of such laws shall porting year, including: apply with respect to any rough dia- (A) Total amount of carats of each mond imported in violation of the Act. classification of rough diamonds im- ported and/or exported; and NOTE TO PARAGRAPH (a): As reflected in (B) Total of all shipments of each paragraphs (a)(1) and (2) of this section, sec- classification of rough diamonds im- tion 8(a) of the Clean Diamond Trade Act (Pub. L. 108–19) establishes penalties with re- ported and/or exported. spect to any violation of any regulation (3) Information on stockpiles of issued under the Act. OFAC prepenalty, pen- rough diamonds, if any, for each of the alty, and administrative collection proce- three Harmonized Tariff Schedule clas- dures relating to such violations are set sifications, as of the end of the report- forth below in §§ 592.602 through 592.605. Sec- ing year, reported in both total carats tion 8(c) of the Act also authorizes the U.S. and approximate total value. For the Bureau of Customs and Border Protection purposes of this section, stockpiles are and the U.S. Bureau of Immigration and Cus- defined as the amount of rough dia- toms Enforcement, as appropriate, to enforce the penalty provisions set forth in paragraph monds held unsold at the end of the re- (a) of this section and to enforce the laws porting period. and regulations governing exports of rough (d) Where to send report. Reports must diamonds, including with respect to the vali- be filed with the Office of the Special dation of the Kimberley Process Certificate Advisor for Conflict Diamonds, U.S. by the U.S. Bureau of the Census. The Office Department of State via e-mail at of Foreign Assets Control civil penalty pro- [email protected]. For fur- cedures set forth below are separate from, ther information, please call that of- and independent of, any penalty procedures fice at 202/647–1713. that may be followed by the U.S. Bureau of Customs and Border Protection and the U.S. (e) Failure to file report. Any importer Bureau of Immigration and Customs En- or exporter who fails to file a required forcement in their exercise of the authorities report shall be subject to the penalties set forth in section 8(c) of the Clean Dia- set forth in Subpart F of this part. mond Trade Act. [73 FR 29434, May 21, 2008] (b) The criminal penalties provided in the Act are subject to increase pur- Subpart F—Penalties suant to 18 U.S.C. 3571. (c) Attention is also directed to 18 § 592.601 Penalties. U.S.C. 1001, which provides that who- (a) Attention is directed to section 8 ever, in any matter within the jurisdic- of the Clean Diamond Trade Act (the tion of the executive, legislative, or ju- ‘‘Act’’) (Pub. L. 108–19), which provides dicial branch of the Government of the that: United States, knowingly and willfully (1) A civil penalty not to exceed falsifies, conceals, or covers up by any $10,000 per violation may be imposed on trick, scheme, or device, a material any person who violates, or attempts fact, or makes any materially false, to violate, any order or regulation fictitious, or fraudulent statement or issued under the Act; representation or makes or uses any (2) Whoever willfully violates, or false writing or document knowing the willfully attempts to violate, any order same to contain any materially false, or regulation issued under this Act fictitious, or fraudulent statement or shall, upon conviction, be fined not entry shall be fined under title 18, more than $50,000, or, if a natural per- , or imprisoned not son, may be imprisoned for not more more than five years, or both.

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(d) Violations of this part may also state the amount of the proposed mon- be subject to relevant provisions of etary penalty. other applicable laws. (2) Right to respond. The prepenalty EFFECTIVE DATE NOTE: At 81 FR 43076, July notice also shall inform the respondent 1, 2016, § 592.601 was amended by revising of the respondent’s right to make a paragraphs (a) introductory text, (a)(1), and written presentation within the appli- (b), effective Aug. 1, 2016. For the conven- cable 30-day period set forth in § 592.603 ience of the user, the revised text is set forth as to why a monetary penalty should as follows: not be imposed or why, if imposed, the § 592.601 Penalties. monetary penalty should be in a lesser (a) Section 8 of the Clean Diamond Trade amount than proposed. Act (the Act) (Pub. L. 108–19, 117 Stat. 631, 19 (c) Informal settlement prior to issuance U.S.C. 3901–3913) provides that: of prepenalty notice. At any time prior (1) A civil penalty not to exceed the to the issuance of a prepenalty notice, amount set forth in section 8 of the Act may an alleged violator may request in be imposed on any person who violates, or attempts to violate, any order or regulation writing that, for a period not to exceed issued under the Act; sixty (60) days, the agency withhold NOTE TO PARAGRAPH (a)(1): As of August 1, issuance of the prepenalty notice for 2016, the applicable maximum civil penalty the exclusive purpose of effecting set- per violation of the Act is $12,856. tlement of the agency’s potential civil monetary penalty claims. In the event * * * * * the Director grants the request, under (b) Adjustments to penalty amounts. (1) The terms and conditions within his discre- civil penalties provided in the Act are sub- tion, the Office of Foreign Assets Con- ject to adjustment pursuant to the Federal trol will agree to withhold issuance of Civil Penalties Inflation Adjustment Act of the prepenalty notice for a period not 1990 (Pub. L. 101–410, as amended, 28 U.S.C. to exceed 60 days and will enter into 2461 note). settlement negotiations of the poten- (2) The criminal penalties provided in the Act are subject to increase pursuant to 18 tial civil monetary penalty claim. U.S.C. 3571. § 592.603 Response to prepenalty no- tice; informal settlement. * * * * * (a) Deadline for response. The respond- § 592.602 Prepenalty notice. ent may submit a response to the (a) When required. If the Director of prepenalty notice within the applicable the Office of Foreign Assets Control 30-day period set forth in this para- has reason to believe that there has oc- graph. The Director of the Office of curred a violation of any provision of Foreign Assets Control may grant, at this part or a violation of the provi- his discretion, an extension of time in sions of any regulation or order issued which to submit a response to the by or pursuant to the direction or au- prepenalty notice. The failure to sub- thorization of the Secretary of the mit a response within the applicable Treasury pursuant to this part or oth- time period set forth in this paragraph erwise under the Clean Diamond Trade shall be deemed to be a waiver of the Act, and the Director determines that right to respond. further civil proceedings are war- (1) Computation of time for response. A ranted, the Director shall notify the al- response to the prepenalty notice must leged violator of the agency’s intent to be postmarked or date-stamped by the impose a monetary penalty by issuing U.S. Postal Service (or foreign postal a prepenalty notice. The prepenalty no- service, if mailed abroad) or courier tice shall be in writing. The prepenalty service provider (if transmitted to the notice may be issued whether or not Office of Foreign Assets Control by another agency has taken any action courier) on or before the 30th day after with respect to the matter. the postmark date on the envelope in (b) Contents of notice—(1) Facts of vio- which the prepenalty notice was lation. The prepenalty notice shall de- mailed. If the respondent refused deliv- scribe the violation, specify the laws ery or otherwise avoided receipt of the and regulations allegedly violated, and prepenalty notice, a response must be

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postmarked or date-stamped on or be- eign Assets Control or any other agen- fore the 30th day after the date on the cy must be repeated in the written re- stamped postal receipt maintained at sponse. Any defense not raised in the the Office of Foreign Assets Control. If written response will be considered the prepenalty notice was personally waived. The written response also delivered to the respondent by a non- should set forth the reasons why the U.S. Postal Service agent authorized respondent believes the penalty should by the Director, a response must be not be imposed or why, if imposed, it postmarked or date-stamped on or be- should be in a lesser amount than pro- fore the 30th day after the date of de- posed. livery. (d) Failure to respond. Where the Of- (2) Extensions of time for response. If a fice of Foreign Assets Control receives due date falls on a federal holiday or no response to a prepenalty notice weekend, that due date is extended to within the applicable time period set include the following business day. Any forth in paragraph (a) of this section, a other extensions of time will be grant- penalty notice generally will be issued, ed, at the Director’s discretion, only taking into account the mitigating upon the respondent’s specific request and/or aggravating factors present in to the Office of Foreign Assets Control. the record. If there are no mitigating (b) Form and method of response. The factors present in the record, or the response must be submitted in writing record contains a preponderance of ag- and may be handwritten or typed. The gravating factors, the proposed response need not be in any particular prepenalty amount generally will be form. A copy of the written response assessed as the final penalty. may be sent by facsimile, but the origi- (e) Informal settlement. In addition to nal also must be sent to the Office of or as an alternative to a written re- Foreign Assets Control Civil Penalties sponse to a prepenalty notice, the re- Division by mail or courier and must spondent or respondent’s representa- be postmarked or date-stamped, in ac- tive may contact the Office of Foreign cordance with paragraph (a) of this sec- Assets Control as advised in the tion. prepenalty notice to propose the settle- (c) Contents of response. A written re- ment of allegations contained in the sponse must contain information suffi- prepenalty notice and related matters. cient to indicate that it is in response However, the requirements set forth in to the prepenalty notice and must in- paragraph (f) of this section as to oral clude the Office of Foreign Assets Con- communication by the representative trol identification number listed on the must first be fulfilled. In the event of prepenalty notice. settlement at the prepenalty stage, the (1) A written response must include claim proposed in the prepenalty no- the respondent’s full name, address, tice will be withdrawn, the respondent telephone number, and facsimile num- will not be required to take a written ber, if available, or those of the rep- position on allegations contained in resentative of the respondent. the prepenalty notice, and the Office of (2) A written response should either Foreign Assets Control will make no admit or deny each specific violation final determination as to whether a alleged in the prepenalty notice and violation occurred. The amount accept- also state if the respondent has no ed in settlement of allegations in a knowledge of a particular violation. If prepenalty notice may vary from the the written response fails to address civil penalty that might finally be im- any specific violation alleged in the posed in the event of a formal deter- prepenalty notice, that alleged viola- mination of violation. In the event no tion shall be deemed to be admitted. settlement is reached, the time limit (3) A written response should include specified in paragraph (a) of this sec- any information in defense, evidence in tion for written response to the support of an asserted defense, or other prepenalty notice will remain in effect factors that the respondent requests unless additional time is granted by the Office of Foreign Assets Control to the Office of Foreign Assets Control. consider. Any defense or explanation (f) Representation. A representative of previously made to the Office of For- the respondent may act on behalf of

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the respondent, but any oral commu- § 592.605 Administrative collection; re- nication with the Office of Foreign As- ferral to United States Department sets Control prior to a written submis- of Justice. sion regarding the specific allegations In the event that the respondent does contained in the prepenalty notice not pay the penalty imposed pursuant must be preceded by a written letter of to this part or make payment arrange- representation, unless the prepenalty ments acceptable to the Director of the notice was served upon the respondent Office of Foreign Assets Control within in care of the representative. 30 days of the date of mailing of the penalty notice, the matter may be re- § 592.604 Penalty imposition or with- ferred for administrative collection drawal. measures by the Department of the (a) No violation. If, after considering Treasury or to the United States De- any response to the prepenalty notice partment of Justice for appropriate ac- and any relevant facts, the Director of tion to recover the penalty in a civil the Office of Foreign Assets Control de- suit in a federal district court. termines that there was no violation by the respondent named in the Subpart G—Procedures prepenalty notice, the Director shall notify the respondent in writing of § 592.701 Procedures. that determination and of the cancella- For procedures relating to rule- tion of the proposed monetary penalty. making and requests for documents (b) Violation. (1) If, after considering pursuant to the Freedom of Informa- any written response to the prepenalty tion and Privacy Acts (5 U.S.C. 552 and notice, or default in the submission of 552a), see part 501, subpart E, of this a written response, and any relevant chapter. facts, the Director of the Office of For- eign Assets Control determines that § 592.702 Delegation by the Secretary there was a violation by the respondent of the Treasury. named in the prepenalty notice, the Di- Any action that the Secretary of the rector is authorized to issue a written Treasury is authorized to take pursu- penalty notice to the respondent of the ant to Executive Order 13312 (FR vol. determination of the violation and the 68, No. 147, July 31, 2003) and any fur- imposition of the monetary penalty. ther Executive orders relating to the (2) The penalty notice shall inform Clean Diamond Trade Act (Pub. L. 108– the respondent that payment or ar- 19) may be taken by the Director of the rangement for installment payment of Office of Foreign Assets Control or by the assessed penalty must be made any other person to whom the Sec- within 30 days of the date of mailing of retary of the Treasury has delegated authority so to act. the penalty notice by the Office of For- eign Assets Control. (3) The penalty notice shall inform Subpart H—Paperwork Reduction the respondent of the requirement to Act furnish the respondent’s taxpayer iden- tification number pursuant to 31 U.S.C. § 592.801 Paperwork Reduction Act no- tice. 7701 and that such number will be used for purposes of collecting and reporting For approval by the Office of Man- on any delinquent penalty amount. agement and Budget (OMB) under the (4) The issuance of the penalty notice Paperwork Reduction Act of 1995 (44 finding a violation and imposing a U.S.C. 3507) of the information collec- tions relating to the recordkeeping and monetary penalty shall constitute final reporting requirements of agency action. The respondent has the §§ 592.301(a)(1), subpart C, § 592.501, sub- right to seek judicial review of that part E, and 592.603, subpart F, see final agency action in federal district § 501.901 of this chapter. The informa- court. tion collection requirements in §§ 592.301(a)(3) and (a)(4), subpart C,

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have been approved by the OMB and as- 593.409 Credit extended and cards issued by signed control numbers 1505–0198 and U.S. financial institutions. 0607–0152, respectively. An agency may 593.410 Setoffs prohibited. not conduct or sponsor, and a person is 593.411 Importation into the United States. not required to respond to, a collection 593.412 Release of any round log or timber of information unless it displays a product originating in from a valid control number assigned by OMB. bonded warehouse or foreign trade zone. 593.413 Transshipments or transit through the United States prohibited. PART 593—FORMER LIBERIAN RE- GIME OF CHARLES TAYLOR Subpart E—Licenses, Authorizations and SANCTIONS REGULATIONS Statements of Licensing Policy 593.501 General and specific licensing proce- Subpart A—Relation of This Part to Other dures. Laws and Regulations 593.502 Effect of license or authorization. Sec. 593.503 Exclusion from licenses. 593.101 Relation of this part to other laws 593.504 Payments and transfers to blocked and regulations. accounts in U.S. financial institutions. 593.505 Entries in certain accounts for nor- Subpart B—Prohibitions mal service charges authorized. 593.506 Investment and reinvestment of cer- 593.201 Prohibited transactions involving tain funds. blocked property. 593.507 Provision of certain legal services 593.202 Effect of transfers violating the pro- authorized. visions of this part. 593.508 Authorization of emergency medical 593.203 Holding of blocked physical funds in interest-bearing accounts; investment services. and reinvestment. 593.509 Transactions related to mail author- 593.204 Expenses of maintaining blocked ized. physical property; liquidation of blocked 593.510 Transactions related to the importa- account. tion of any round log and timber product 593.205 Prohibition on the importation of originating in Liberia authorized. any round log or timber product origi- nating in Liberia. Subpart F—Reports 593.206 Evasions; attempts; conspiracies. 593.601 Records and reports. Subpart C—General Definitions Subpart G—Penalties 593.301 Blocked account; blocked property. 593.302 Effective date. 593.701 Penalties. 593.303 Entity. 593.702 Prepenalty notice. 593.304 Interest. 593.703 Response to prepenalty notice; infor- 593.305 Licenses; general and specific. mal settlement. 593.306 Originating in Liberia. 593.704 Penalty imposition or withdrawal. 593.307 Person. 593.705 Administrative collection; referral 593.308 Property; property interest. to United States Department of Justice. 593.309 Round log or timber product. 593.310 Transfer. 593.311 United States. Subpart H—Procedures 593.312 U.S. financial institution. 593.801 Procedures. 593.313 United States person; U.S. person. 593.802 Delegation by the Secretary of the Subpart D—Interpretations Treasury. 593.401 Reference to amended sections. Subpart I—Paperwork Reduction Act 593.402 Effect of amendment. 593.403 Termination and acquisition of an 593.901 Paperwork Reduction Act notice. interest in blocked property. AUTHORITY: 3 U.S.C. 301; 31 U.S.C. 321(b); 50 593.404 Transactions ordinarily incident to U.S.C. 1601–1651, 1701–1706; 22 U.S.C. 287c; Pub. a licensed transaction. L. 101–410, 104 Stat. 890 (28 U.S.C. 2461 note); 593.405 Provision of services. Pub. L. 110–96, 121 Stat. 1011; E.O. 13348, 69 FR 593.406 Offshore transactions. 44885, 3 CFR, 2004 Comp., p. 189. 593.407 Payments from blocked accounts to satisfy obligations prohibited. SOURCE: 72 FR 28856, May 23, 2007, unless 593.408 Charitable Contributions. otherwise noted.

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