BIS updates voluntary self-disclosure policy to punish not coming forward

Commerce Department

The Commerce Department’s Bureau of Industry and Security (BIS) updated its guidelines to further clarify the advantages of voluntary self-disclosure (VSD) to the agency when export control violations are uncovered.

The policy changes, revealed in a memo from Assistant Secretary for Export Enforcement Matthew Axelrod shared Tuesday, most notably put pressure on businesses that uncover “significant” potential violations but don’t come forward. Firms found to be in such a situation will now have their actions held against them as an aggravating factor in BIS enforcement decisions.

“In other words, when someone submits a VSD, they receive concrete and identifiable benefits under our guidelines,” wrote Axelrod. “By the same token, however, when someone uncovers a significant possible violation but then affirmatively chooses not to file a VSD, they are running a substantial risk because if it does come to our attention, the decision not to disclose will be considered an aggravating factor under our existing guidelines.”

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