PROLIFERATION THREATS & CHALLENGES

y Access to dual-use, WMD-relevant items & technologies by States with questionable conduct or intent y Access by non-state actors/terrorist groups y Emerging suppliers (states) y Industry (complicit or ignorant) y Inadequate strategic trade controls in transit or transshipment states * Growing dual-use applications of items & technologies requires balancing trade with security imperatives. 2

THE ENACTMENT OF STA 2010

UNSC Resolution 1540 in 2004 y Cabinet - 26 March 2010 y Parliament 5 April 2010 (Dewan Rakyat) 6 May 2010 (Dewan Negara) y Royal Assent - 2 June 2010 y Gazette - 10 June 2010 y Gazette of Regulations and Orders 31 December 2010 y Enforcement 1 April 2011 y On-line Permit Application 1 July 2011 Permit Validation by Customs 3 - 1 March 2012

REGULATIONS AND ORDERS

STA 2010

Strategic Trade Regulations 2010 Prescribes: forms any matter, including enforcement
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Strategic Trade (Strategic Items) Order 2010

procedures payable fees

Strategic Trade (Restricted End-Users and Prohibited EndUsers) Order 2010

Protection of New Plant Varieties Act 2004

Plant Quarantine Act 1976 Customs Act 1967

Pesticide Act 1974

Prevention and Control of Infectious Diseases Act 1988

Related Laws

Animals Act 1953 Atomic Energy Licensing Act 1984

Poison Act 1952

Malaysian Communications and Multimedia Commission Act 1998

Chemical Weapons Convention Act 2005

If these laws are in conflict or inconsistent:

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STA shall prevail

OBJECTIVES OF STA
transit export CONTROLS transhipment brokering other activities

Goods
- Listed - Unlisted
design

FACILITATES

technology
production

development

WEAPONS OF MASS DESTRUCTION (WMD) & ITS DELIVERY SYSTEMS

LICENSING MINISTRY/AGENCIES

Strategic Trade Secretariat, MITI

Malaysian Communications and Multimedia Commission (MCMC)

Atomic Energy Licensing Board (AELB)

Pharmaceutical Services Division, Ministry of Health

ENFORCEMENT AGENCIES
Other officers specified by the Controller Royal Malaysian Royal Malaysian Customs Police
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Malaysian Maritime Enforcement Agency

MCMC

DEFINITIONS
to take or cause to be taken out of Malaysia any items by land, sea or air or to place any items in a conveyance for the purpose of such items being taken out of Malaysia

export

* items include goods and technology

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CONT
to bring items from any country into Malaysia by land, sea or air where the items are to be taken out from Malaysia

bring in transit

CONT
to remove items from the conveyance on which they were brought into Malaysia and to place the items on the same or another conveyance for the purpose of taking them out of Malaysia where these acts are carried out using a through bill of lading, airway bill or manifest

transhipment

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 the activity of a person who, either on his own behalf or acting as an agent on behalf of another person-

CONT

brokering

(a) negotiates, arranges or facilitates the purchasing, financing, conveying, sale or supply of items; or sells (b) buys, supplies such items or

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BROKERING CONT
Transaction of WMD UNSCR 1540s call to prevent any assistance to such activities as an accomplice. A broker is person/entity who facilitates the transaction of a strategic trade item from country A to country B. A broker does not necessarily have to be in possession of the brokered item or even land it in Malaysia For the purpose of the STA 2010, the person/entity involved in brokering should be domiciled in Malaysia.
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BROKERING CONT
Who is a broker? - Individuals - Companies - Freight forwarders - Delivery services - Financial institutions - Agents for foreign manufacturers A broker has to be registered under the STA 2010 to deal in the specified strategic items. Registration certificate is valid for a period of one year. Exemption - if he/she is involved in bringing in exhibits for Governments international events such as LIMA, Defence Services Asia Exhibition, etc. However, brokers to inform the Strategic Trade 13 Secretariat prior to the events.

BROKER CERTIFICATE FORM 8 (PAGE 1 OF 2)

WHAT ABOUT GOVERNMENT AND VISITING FORCE?

According to Reg. 22, the requirement for permit shall not apply to: a) any act authorised by or carried out for or on behalf of the Government; b) the following acts carried out by a military, naval or air force of a foreign government (not being a visiting force) in the course of duty: i. the export, transhipment or bringing in transit of any strategic items or unlisted items that are brought into Malaysia by that force; or ii. the transmission of any technology that is brought into Malaysia or received by that force from its government; or c)
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the export, transhipment or bringing in transit of any strategic items or unlisted items by or on behalf of a visiting force in the course of duty.

SINGLE-USE
ONE-TIME EXPORT, TRANSHIPMENT OR BRING IN TRANSIT PERMIT for a SINGLE COUNTRY / DESTINATION Valid for 6 months

MULTIPLE- USE
(*NEEDS INTERNAL COMPLIANCE PROGRAMME)

BULK (*NEEDS ICP)

MULTIPLE EXPORTS OR TRANSHIPMENT of the items for DIFFERENT COUNTRIES / DESTINATIONS Valid for 2 years

PERMIT

MULTIPLE EXPORTS OR TRANSHIPMENT of items for a SINGLE COUNTRY / DESTINATION Valid for 2 years

SPECIAL
ONE-TIME EXPORT, TRANSHIPMENT OR BRING IN TRANSIT PERMIT for a SINGLE COUNTRY / DESTINATION which the end-user is a RESTRICTED END-USER Valid for 1 year 16

 It is a set of procedures that have to be implemented within a company before an item is exported using multiple-use or bulk permit. The procedures in place ensure that the company complies with the Strategic Trade Act 2010 and associated Regulations. The Controls can be done: manually electronically, etc. Other names for ICP: Internal Control Plan Export Management System Export Compliance Program 17 Trade Compliance Program

 Centralise export-related procedures Standardise control procedures Provide early warning Generate record keeping and documentation for sensitive exports complete

Develop and maintain good relationship with export control authorities Keep updated on export control laws and regulations Train all employees on the need for export control (company-wide)
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 Ensure compliance with applicable laws and regulations Detect export control violations Contribute to non-proliferation of sensitive items, technology and information

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 Company-wide awareness of export control Highest level of support, i.e. letter from CEO or equivalent Clearly assigned accountability Written compliance manuals, policies and procedures ICP to be procedures integrated with standard business

On-going training on policies and procedures Regular audits/self-assessments Corrective action plans
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AN EFFECTIVE FOLLOWING:

ICP

REQUIRES

THE

1) Management Commitment 2) Screening Process 3) Training 4) Record-keeping 5) Audit

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Classification of Products or Items

Strategic Items
Listed A. Military B. Dual-Use 0) Nuclear Materials, Facilities & Equipment 1) Materials, Chemicals, Microorganisms and Toxins 2) Material Processing 3) Electronics 4) Computers 5) Telecommunications and Information Security 6) Sensors and Lasers 7) Navigations & Avionics 8) Marine 9) Propulsion Systems, Space Vehicles & Related Equipment
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Unlisted If a person is informed by the relevant authority; OR If a person knows/has reason to believe that the item will or may be used for a restricted activity.

STRATEGIC ITEMS
Categories and Numbering Scheme
0 Technical Category 0 Nuclear Materials, Facilities and Equipment 1 Materials, Chemicals, Microorganism and Toxins 2 Material Processing 3 Electronics 4 Computers 5 Telecommunications and Information Security 6 Sensors and Lasers 7 Navigation and Avionics 8 Marine 9 Propulsion Systems, Space Vehicles and Related 23 Equipment B Product Group A Systems, Equipment, Components B Test, Inspection and Product Equipment C Materials D Software E Technology 0 Regime Origin 0:Wassenaar or NSG Trigger List 1: MTCR 2: NSG Dual-Use List 3: AG 4: CWC 01 Item. No.

Military List
ML1.a Rifles, carbines, revolvers, pistols, machine pistols and machine guns Ammunition for the weapons under ML1, ML2 or ML12 Bombs, torpedoes, rockets, missiles, other explosive devices ML3.a ML4 -

ML5.b

Target acquisition, designation, range-finding, surveillance or tracking systems Chemical or biological toxic agents, riot control agents , radioactive materials, related equipment, components and materials

ML7

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Military List
ML9 Vessels of war (surface or underwater), special naval equipment, accessories, components and other surface vessels (a) - Vessels and components (b)- Engines and propulsion systems ML10 Aircraft , lighter-than-air vehicles , unmanned airborne vehicles, aero-engines and aircraft equipment (c) - Unmanned airborne vehicles and related equipment (g) - Military crash helmets and protective masks (h) - Parachutes, paragliders and related equipment

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Military List
ML11 Electronic equipment (a) - Electronic equipment specially designed for military use (b) - Global Navigation Satellite Systems (GNSS) jamming equipment ML13 Armoured or components protective equipment, constructions and

(c) - Helmets manufactured according to military standards or specifications (d) - Body armour and protective garments, manufactured according to military standards or specifications ML21 Software

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1B001-Filament Winding Machines Commercial Uses and Resources

Filament Winding Machines are used to manufacture a wide variety of products including: sporting goods such as golf clubs shafts, bicycle frames, and baseball bats storage tanks, pipes, bearings several aerospace components Manufacturers
ARCOTRONICS ITALIA SpA - Italy Automated Dynamics - Schenectady, NY Entec Composite Machines, Inc. - Salt Lake City, UT , POURTIER - Gauder Group - France Proton Products - United Kingdom TCI Machinery, Inc. - Gastonia,
Filament wound paddles

Information http://www.fas.org/nuke/control/mtcr/ text/mtcr_handbook_item6.pdf

Over half the bike is filament wound parts

Filament Winding Machines Appearance

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Other examples - ML 4- Bombs, torpedoes, rockets, missiles, other explosive devices and charges and related equipment and accessories, as follows, and specially designed components

EXEMPTIONS
Transit and Transhipment

arrive in a Free Commercial Zone (FCZ) or brought immediately into FCZ remain in the FCZ not exceeding 30 days

* 95% of transit and transshipment of strategic items are exempted from applying for permits.
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HOWEVER, THE EXEMPTIONS DO NOT APPLY TO THE FOLLOWING COUNTRIES

North Korea

Iran

Congo

Ivory Coast

Lebanon

Sudan

Afghanistan

Iraq

Liberia

Rwanda

Somalia

Eritrea

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Libya

AND
y No exemption for Transhipment Permit for

Schedule Three items of the STA Regulations 2010, e.g:

 Military items

rifles, revolvers, pistols, ammunitions, bombs, torpedoes, rockets, missiles, war vessels, war aircrafts  Nuclear reactors, gas centrifuge plant  Uranium, maraging steel, tungsten, molybdenum  Toxic chemicals, human pathogens

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DNT Registration for User ID and Password www.dagangnet.com Get User ID and Password STA Registration http://www.mytradelink.gov.my Key-in information Submit Application Approved by MITI Get Digital Signature Token from DNT Activation of Digital Signature
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Permit Application

REGISTRATION / PERMIT APPLICATION

ONE SINGLE SYSTEM

PRE-REGISTRATION

PERMIT APPLICATION

SINGLE / MULTIPLE-USE / BULK SINGLE / MULTIPLE-USE / / SPECIAL PERMIT BULK PERMIT REJECTED APPROVED

CUSTOMS
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APPLICANT

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