[Federal Register Volume 77, Number 136 (Monday, July 16, 2012)]
[Notices]
[Pages 41742-41744]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-17236]


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DEPARTMENT OF COMMERCE

Bureau of Industry and Security


In the Matter of: Humane Restraint, Inc., 912 Bethel Circle, 
Waunakee, WI 53597, Respondent; Order Relating To Humane Restraint, Inc

    The Bureau of Industry and Security, U.S. Department of Commerce 
(``BIS''), has notified Humane Restraint, Inc. of Wanakee, WI (``HR''), 
of its intention to initiate an administrative proceeding against HR 
pursuant to Section 766.3 of the Export Administration Regulations (the 
``Regulations''),\1\ and Section 13(c) of the Export Administration Act 
of 1979, as amended (the ``Act''),\2\ through the issuance of a 
Proposed Charging Letter to HR that alleged that HR committed 32 
violations of the Regulations. Specifically, these charges are:
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    \1\ The Regulations are currently codified in the Code of 
Federal Regulations at 15 CFR Parts 730-774 (2012). The charged 
violations occurred in 2006-2008. The Regulations governing the 
violations at issue are found in the 2006-2008 versions of the Code 
of Federal Regulations (15 CFR Parts 730-774 (2006-2008)). The 2012 
Regulations set forth the procedures that apply to this matter.
    \2\ 50 U.S.C. app. Sec. Sec.  2401-2420 (2000). Since August 21, 
2001, the Act has been in lapse and the President, through Executive 
Order 13222 of August 17, 2001 (3 CFR 2001 Comp. 783 (2002)), which 
has been extended by successive Presidential Notices, the most 
recent being that of August 12, 2011 (76 FR 50661 (Aug. 16, 2011)), 
continues the Regulations in effect under the International 
Emergency Economic Powers Act (50 U.S.C. 1701, et seq.).
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Charges 1-27 15 CFR 764.2(a)--Engaging in Prohibited Conduct by 
Exporting Various Restraint Devices Without the Required Government 
Authorizations

    On 27 occasions between on or about April 10, 2006 and on or about 
August 8, 2008, HR engaged in conduct prohibited by the Regulations by 
exporting various restraint devices, including, but not limited to, 
strait jackets, bed restraints, and wrist and ankle restraints, items 
subject to the Regulations, classified under Export Control 
Classification Number (``ECCN'') 0A982, controlled for Crime Control 
reasons, and valued at approximately $14,697, from the United States to 
Germany, Greece, Hungary, Ireland, New Zealand, South Korea, Taiwan, 
and the United Kingdom without the Department of Commerce licenses 
required by Section 742.7(a) of the Regulations. In so doing, HR 
committed 27 violations of Section 764.2(a) of the Regulations.

[[Page 41743]]

Charge 28 15 CFR 764.2(c)--Attempting To Export a Strait Jacket Without 
the Required Government Authorization

    On or about November 28, 2007, HR attempted a violation of the 
Regulations. Specifically, HR attempted to export a strait jacket, an 
item subject to the Regulations, classified under ECCN 0A982, 
controlled for Crime Control reasons, and valued at approximately $112, 
from the United States to the United Kingdom without the Department of 
Commerce license required by Section 742.7(a) of the Regulations. The 
item was seized by U.S. Customs and Border Patrol (``CBP'') prior to 
leaving the United States. In so doing, HR committed one violation of 
Section 764.2(c) of the Regulations.

Charges 29-32 15 CFR 764.2(e)--Acting With Knowledge of a Violation

    On four occasions between on or about January 2, 2008 and on or 
about August 7, 2008, HR sold items exported or to be exported from the 
United States with knowledge that a violation of the Regulations was 
about to occur or was intended to occur in connection with the items. 
Specifically, on four occasions HR sold strait jackets and an 
ambulatory restraint kit, items classified under ECCN 0A982, controlled 
for Crime Control reasons, and valued at approximately $1,818. These 
items were exported or to be exported from the United States to 
Australia, Germany, and Taiwan. HR knew or should have known that a 
Department of Commerce export license was required to export these 
items because, inter alia, on or about December 10, 2007, before these 
violations occurred, HR was informed of licensing requirements by CBP, 
which had stopped and later seized HR's November 28, 2007 attempted 
unlicensed export, described in Charge 28, above. In so doing, HR 
committed four violations of Section 764.2(e) of the Regulations.
    Whereas, BIS and HR have entered into a Settlement Agreement 
pursuant to Section 766.18(a) of the Regulations, whereby they agreed 
to settle this matter in accordance with the terms and conditions set 
forth therein; and
    Whereas, I have approved of the terms of such Settlement Agreement;
    It is therefore ordered:
    First, HR shall be assessed a civil penalty in the amount of 
$465,000. HR shall pay the U.S. Department of Commerce in four 
installments of: $12,500 not later than August 1, 2012; $12,500 not 
later than February 1, 2013; $12,500 not later than August 1, 2013; and 
$12,500 not later than February 1, 2014. If any of the four installment 
payments is not fully and timely made, any remaining scheduled 
installment payments and any suspended penalty shall become due and 
owing immediately. Payment of the remaining $415,000 shall be suspended 
for a period of two years from the date of issuance of the Order, and 
thereafter shall be waived, provided that during this two-year payment 
probationary period under the Order, HR has committed no violation of 
the Act, or any regulation, order, or license issued thereunder and has 
made full and timely payment of $50,000 as set forth above.
    Second, that, pursuant to the Debt Collection Act of 1982, as 
amended (31 U.S.C. 3701-3720E (2000)), the civil penalty owed under 
this Order accrues interest as more fully described in the attached 
Notice, and if payment is not made in by the due date specified herein, 
HR will be assessed, in addition to the full amount of the civil 
penalty and interest, a penalty charge and an administrative charge, as 
more fully described in the attached Notice.
    Third, that the full and timely payment of the civil penalty in 
accordance with the payment schedule set forth above is hereby made a 
condition to the granting, restoration, or continuing validity of any 
export license, license exception, permission, or privilege granted, or 
to be granted, to HR. Accordingly, if HR should fail to pay the civil 
penalty in a full and timely manner, the undersigned may issue an Order 
denying all of HR's export privileges under the Regulations for a 
period of one year from the date of failure to make such payment.
    Fourth, that, except as provided in paragraph SIXTH of this Order, 
for a period of two (2) years from the date of issuance of the Order, 
Humane Restraint, Inc., with a last known address of 912 Bethel Circle, 
Waunakee, WI 53597, and when acting for or on its behalf, its 
successors, assigns, directors, officers, employees, representatives, 
or agents (hereinafter collectively referred to as ``Denied Person'') 
may not, directly or indirectly, participate in any way in any 
transaction involving any commodity, software or technology 
(hereinafter collectively referred to as ``item'') exported or to be 
exported from the United States to any destination other than Canada 
that is subject to the Regulations, or in any other activity subject to 
the Regulations that involves a destination other than Canada, 
including, but not limited to:
    A. Applying for or obtaining any license, or License Exception that 
involves an export to any destination other than Canada;
    B. Carrying on negotiations concerning, or ordering, buying, 
receiving, using, selling, delivering, storing, disposing of, 
forwarding, transporting, financing, or otherwise servicing in any way, 
any transaction involving any item exported or to be exported from the 
United States to any destination other than Canada that is subject to 
the Regulations, or in any other activity subject to the Regulations 
that involves a destination other than Canada; or
    C. Benefitting in any way from any transaction involving any item 
exported or to be exported from the United States to any destination 
other than Canada that is subject to the Regulations, or in any other 
activity subject to the Regulations that involves a destination other 
than Canada.
    Fifth, that, except as provided in paragraph SEVENTH of this Order, 
no person may, directly or indirectly, do any of the following:
    A. Export or reexport to or on behalf of the Denied Person any item 
subject to the Regulations to any destination other than Canada;
    B. Take any action that facilitates the acquisition or attempted 
acquisition by the Denied Person of the ownership, possession, or 
control of any item subject to the Regulations that has been or will be 
exported from the United States to any destination other than Canada, 
including financing or other support activities related to a 
transaction whereby the Denied Person acquires or attempts to acquire 
such ownership, possession or control;
    C. Take any action to acquire from or to facilitate the acquisition 
or attempted acquisition from the Denied Person of any item subject to 
the Regulations that has been exported from the United States to any 
destination other than Canada;
    D. Obtain from the Denied Person in the United States any item 
subject to the Regulations with knowledge or reason to know that the 
item will be, or is intended to be, exported from the United States to 
any destination other than Canada; or
    E. Engage in any transaction to service any item subject to the 
Regulations that has been or will be exported from the United States to 
any destination other than Canada and which is owned, possessed or 
controlled by the Denied Person, or service any item, of whatever 
origin, that is owned, possessed or controlled by the Denied Person if 
such service involves the use of any item subject to the Regulations 
that has been or will be exported from the United

[[Page 41744]]

States to any destination other than Canada. For purposes of this 
paragraph, servicing means installation, maintenance, repair, 
modification or testing.
    Sixth, that this Order does not prohibit HR from exporting items 
from the United States under a previously approved U.S. Department of 
Commerce export license that is valid as of the date of this Order. Any 
exports made under this provision shall be subject to all terms, 
conditions and expiration dates contained in the underlying export 
license.
    Seventh, that this Order does not prohibit freight forwarders, 
carriers, consignees or end users from participating in export 
transactions authorized by a previously approved U.S. Department of 
Commerce export license issued to HR that is valid as of the date of 
this Order. Any actions taken under this provision shall be subject to 
all terms and conditions of the underlying export license.
    Eighth, that, after notice and opportunity for comment as provided 
in Section 766.23 of the Regulations, any person, firm, corporation, or 
business organization related to the Denied Person by affiliation, 
ownership, control, or position of responsibility in the conduct of 
trade or related services may also be made subject to the provisions of 
the Order.
    Ninth, that the Proposed Charging Letter, the Settlement Agreement, 
and this Order shall be made available to the public.
    Tenth, that this Order shall be served on HR, and shall be 
published in the Federal Register.
    This Order, which constitutes the final agency action in this 
matter, is effective immediately.

    Issued this 9th day of July, 2012.
David W. Mills,
Assistant Secretary of Commerce for Export Enforcement.
[FR Doc. 2012-17236 Filed 7-13-12; 8:45 am]
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