Denied Party Digest

Valuable information about denied party screening

Know Your Sanctions Lists (Beyond the CSL) – DDTC Penalties & Oversight Agreements

Beyond the Consolidated Screening List, ECScreening provides data from a growing number of official U.S. and foreign government sanctions lists and other sources to bring useful information to subscribers.  

One of these lists, from the Department of State’s Directorate of Defense Trade Controls (DDTC) is the DDTC Penalties & Oversight Agreements.  DDTC publishes the names and consent agreements related to violations of the International Traffic in Arms Regulation (ITAR).  Consent agreements typically follow the identification of serious ITAR violations and may include monetary fines as well as specific compliance improvements.

According to DDTC:

The Consent Agreement outlines the measures required to enhance compliance programs. These may include appointment of a Special Compliance Officer (SCO) or Internal Special Compliance Officer (ISCO), institution of a policy of denial, debarment, comprehensive audits, or institution of a "cradle-to-grave" export tracking system. Each Consent Agreement is tailored to the export violations that occurred, the cooperativeness of the company in coming to resolution, and the level of compliance measures already in place upon signing the agreement.

Every consent agreement is different and generally does not mean that you cannot do business with the company involved.  Instead, it serves as important background information for due diligence, highlighting weak export compliance areas that have already been identified.  A company that is subject to a consent agreement may even have better export compliance systems in place after the agreement than other business partners that have not seen that kind of attention.

If your screening process turns up a DDTC consent agreement, don’t worry too much, but read the public documents.