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Treasury Makes It Easier to Comply, When Exporting

PMA manufacturers who are exporting their parts from the U.S. need to ensure that they remain in compliance with the U.S. export regulations.  In addition to the BIS and DDTC regulations that apply to aircraft parts, exporters also need to remain in compliance with Treasury Department regulations.

Some of those Treasury Department regulations include lists of people and entities that you ought not to do business with.  Every agency has multiple lists that you need to examine, but Treasury is doing something to consolidate its lists and make it easier to review them. This consolidation should make it easier to search to ensure compliance, whether you are searching on line or using a computer program to automatically research your business partners.

The Treasury Department office with jurisdiction over export programs is the Office of Foreign Asset Control (OFAC).  OFAC has a list of Specially Designated Nationals (SDNs) as well as other (non-SDN) sanctions lists. OFAC is now offering all of its non-SDN sanctions lists in a consolidated set of data files called the Consolidated Sanctions List. This consolidated list will include the following:

  • Non-SDN Palestinian Legislative Council List
  • Part 561 List
  • Non-SDN Iran Sanctions Act List
  • Foreign Sanctions Evaders List
  • Sectoral Sanctions Identifications List

OFAC announced that it plans to discontinue some of these lists as separate lists, so they will only be available as part of the consolidated list.

Persons seeking to check whether there are OFAC sanctions that might apply to their transaction should be sure to check their export business partners (by personal name and company name) against the Specially Designated Nationals List and the Consolidated Sanctions List.

One can also use the Sanctions List Search which consolidates both lists into a single searchable database. This tool is useful because it can automatically search for names that are close (bot not exact matches) and can be set to find matches with different levels of confidence (which will then be reviewed by a human to assess whether they actually match).

Exporters should also check the details of their transaction (including destination country) against the Sanctions Programs and Country Information page, which list sanctions programs based on country and on certain other criteria.

MARPA Wins Department of Commerce Grant to Expand Export of PMA!

MARPA is proud to announce that it is the recipient of a $300,000 matching grant from the Department of Commerce International Trade Administration Market Development Cooperator Program!  MARPA was one of eight recipients of funding under the Market Development Cooperator Program (MDCP), which is intended to help organizations boost exports and create U.S. jobs.  With the receipt of this assistance, MARPA plans to implement a number of initiatives to help grow the international PMA market and most importantly help our members grow their businesses by exporting more PMA parts!

The first of these initiatives will be to establish a European MARPA Conference, similar to the MARPA Annual Conference held in Las Vegas. Our current target is for the inaugural MARPA Europe conference to occur in May 2015, in Istanbul, Turkey.  The primary goal of MARPA Europe will be to bring together PMA manufacturers (our members) and customers from both Europe and the Middle East.  Air carriers reliably account for 25% of our Las Vegas attendees, and we expect to meet or exceed that rate at MARPA Europe.

Another initiative will be to lead educational missions to regions that present an opportunity for expanded PMA penetration. These include Japan, China, Southeast Asia, and the Middle East.  MARPA will lead technical and regulatory seminars explaining the benefits of PMA and the way PMAs fit within the regulatory framework of the various countries we visit.  MARPA also plans to attend regional MRO shows and other trade shows to educate the global aviation industry about the benefits of PMA.

Finally, MARPA will work with our partners and air carrier contacts to continue to bring more air carriers to both the MARPA Annual Conference in Las Vegas as well as MARPA Europe.  The significant and growing attendance by air carriers at MARPA’s conferences make them the premiere events for PMA manufacturers to meet and network with air carriers in an intimate setting.

Of course nothing in life is free!  One very important element of MARPA’s participation is the MDCP program will be measuring the effects our efforts have on growing the export PMA market.  In a previous post we explained that MARPA would begin collecting export data from our members to get a better idea of the global PMA market share and identify to what market PMAs were being sold and where opportunities lay.  As a part of our commitment to the Commerce Department, MARPA will track and measure the increases in exports reported by our members.  This will be an important part of the next three years, as MARPA works closely with the Commerce Department to grow exports of PMA.  MARPA will also need the help of its members to collect and report accurate data to measure the effects of our initiatives.  We will be working with our members to help them increase their exposure to foreign markets and increase their exports in order to optimize the return on the Commerce Department’s investment as well as to develop accurate PMA export data.

Fred Elliot from the Department of Commerce and Ryan Aggergaard from MARPA will be on hand at the MARPA 2014 Annual Conference in Las Vegas to discuss some of MARPA’s planned initiatives and the requirements related to the award of the MDCP grant, as well as to answer member questions on how they can benefit from MARPA’s new programs.  We look forward to seeing you there!

PMA Export Data Needed

As the sole trade association representing the PMA industry, MARPA receives many inquiries from both industry and regulators regarding the economic effect of the PMA industry.  Among the most frequent question is to the extent PMA parts are exported to other countries.  Because the aerospace industry is such a large exporter, information regarding economic effect is useful in helping to shape policy and build support for the industry.

Unfortunately, MARPA does not have a significant pool of data from which to report or draw conclusions when approached with questions about economic effects and export statistics.  Although we have data from a handful of members and plenty of anecdotal evidence to support the PMA industry’s positive economic effect, we lack significant hard data from which to draw any statistical conclusions.  We would like to change this.

MARPA is therefore beginning an initiative to collect export data from our members to begin developing statistical data specific to the PMA industry.  Rather than relying on information from aerospace trade publications or industry forecasting groups, which tend to focus on the aerospace industry as a whole without distinguishing PMA, MARPA seeks to develop a PMA-specific industry analysis.

But to develop and perform such economic export analyses, we need the help of our members.  We will therefore be requesting that our members provide to us economic export data about their businesses.  Such data would include, for example, to which countries you export, revenue derived from export, and percentage of total revenue derived from exports.

Of course, there is nothing more important to MARPA than a robust and competitive PMA industry.  With that in mind, all information submitted to MARPA will be kept strictly confidential, and used only for overall statistical analysis.  No company names, data, or strategies will ever be disclosed, either to other members, regulators, or the public in general.  We understand and appreciate how important confidentiality is, and how much value is placed in keeping data about your business private.

The more data we obtain the better we will be able to promote the benefits of PMA, open new markets and expand existing markets, continue to build the trust of industry, and gain the support of regulators.  We cannot do any of this without the support of our members.

We will be discussing this initiative further at the MARPA Annual Conference in Las Vegas, just a little more than a month away.  But in the meantime, if you have data readily available, or have any questions about this initiative, you can email them to Ryan Aggergaard at MARPA at ryan@washingtonaviation.com.  We look forward to hearing from you, and continuing to build the future of PMA.

In Tokyo, MARPA Seeks Out New Suppliers and Customers for our Members

This week, MARPA is in Japan at the 2013 Aerospace Industry Exhibition Tokyo (ASET 2013).  MARPA has an exhibit booth featuring information about the PMA marketplace and about our membership.

MARPA is not alone!  Both Heico and Jet Parts Engineering sent staff to participate in the PMA panel during the conference.  The panel featured two hours of presentations about PMA and questions and answers about PMA. It was attended by over a hundred aerospace professionals interested in learning more abut PMA.

In addition, though, several of our members sent literature to the conference, and MARPA has been handing their information to interested conference attendees.  Those members were:

  • Measure Tech
  • Timken
  • K&S Enterprises
  • Hemico
  • Heico

So far, we’ve seen a lot of interest from Japanese manufacturing companies in partnering with PMA companies from the United States, so the literature from member companies has been very helpful in educating the Japanese marketplace about potential US partners.

Many Japanese companies seem able to bring novel production technologies and novel solutions to the table as potential partners/suppliers.  But that has not been the sole focus of this trip.  We also had an opportunity to spend time with representatives from both ANA and JAL during our trip.  Both air carriers remain keenly interested in the potential posed by PMA.

We were fortunate to be invited to deliver training sessions to both ANA Trading and ANA’s Materials Management Department.  Both organizations were very gracious hosts.  PMA was an important topic in each of those training sessions,  and there were lots of insightful questions.

Planning on Having Your Company Literature Featured in MARPA’s Booth in Tokyo? Here’s How:

We previously wrote in this space that MARPA will be attending the  2013 Aerospace Industry Exhibition Tokyo (ASET). As a benefit to our members, MARPA plans to feature member-company literature in our booth to allow you to make connections with the Japanese aerospace manufacturing market.  This is just one of the benefits of MARPA membership.  ASET offers an excellent opportunity get in front of a substantial segment of the Japanese aerospace manufacturing community; at the last conference over 23,000 people attended!

In order to help us feature member companies in the MARPA booth, members must ship their literature to us in Tokyo.  To ensure we are able to showcase your literature, you must follow these steps:

1.  Act quickly!  ASET runs October 2-4.  You should plan to have your literature arrive absolutely no later than Monday, September 23.  This will allow adequate time to ensure your package clears customs.

2.  Ship your package to:

MARPA (Booth No. G-01)
c/o AEROSPACE INDUSTRY EXHIBITION TOKYO 2013
2013 Management office
Tokyo Big Site
3-11-1 Ariake, Koto-ku, Tokyo 135-0063, Japan
 

3.  Email Katt Brigham at MARPA with your package tracking information.  This should include the date the package was shipped and the estimated date of arrival.  You should also include the contents of your package so we know what to look for.

4.  Confirm your package arrives in Tokyo.  When you have confirmed arrival email Katt to let us know as well.

Remember it will take about a week for your shipment to clear customs upon arrival in Japan.  It is therefore vital that you ship your literature in time to ensure arrival by September 23.

MARPA is excited to be able to offer this opportunity to its members.  If you have any questions about shipping, please contact Katt at (202) 628-6777 or by email at katt@marpa.aero.

Opportunity for MARPA Members to Have Their Company Literature Presented Japan

MARPA is pleased to announce that we will be at the 2013 Aerospace Industry Exhibition Tokyo, and you can be there too!

While this is a fantastic opportunity for making connections in the Japanese aerospace manufacturing market, we recognize that not ever member can afford to add this to their trade show agenda, so MARPA will be featuring literature from members at their booth.  That’s right – you can have your company literature included in the MARPA literature rack at ASET 2013 in Tokyo!

COST: Free to MARPA members (it is a membership benefit).

HOW BIG IS THIS CONFERENCE: The last conference was in 2011 (it is held every two years) and there were 23,373 visitors for the aerospace trade floor.

YOUR REQUIREMENTS: YOU are responsible for producing your company materials.  YOU are responsible for shipping the materials to the convention center and for alerting us to look for it.

WHAT WE WILL DO: We will keep your literature in our literature rack or on our display table (depending on factors like size and volume of member response) and hand it out to interested conference-attendees.

HOW DO I GET STARTED: Contact Katt Brigham by calling or emailing the Association

OTHER CONFERENCE DETAILS:

The Aerospace Industry Exhibition Tokyo (ASET) is the only exhibition held in Tokyo dedicated to specialized aerospace technologies.  In addition to the unique business opportunity, ASET also features programs and lectures from key industry figures, as well as business and social networking events.

MARPA will have an exhibit booth for the three day event, October 2-4, 2013, and MARPA President Jason Dickstein will give a keynote address discussing PMA and the advantages that it represents.  This is an excellent opportunity to further raise industry awareness about the value and benefits of PMA and about MARPA itself.

DO YOU PLAN TO ATTEND?

ASET has asked for our help in getting the word out about this opportunity, as ASET is seeking PMA companies to join their PMA session.  The PMA companies would be asked to introduce their business to the attendees and participate in a PMA panel.  As inducement for participation, ASET is offering to provide exhibition booth space (three-day exhibition required) and potentially other inducements to PMA companies who are willing to present at the exhibition.

The city of Tokyo’s event planning subsidiary specifically requested the presence of PMA manufacturers at ASET 2013.  This is a great opportunity for our members to exhibit their products in front of a large audience in one of Asia’s key business hubs.  It is also a chance to further educate the aerospace community on the advantages of PMA.

If your company is interested in taking advantage of this opportunity, please contact ASET advisor Jay Kato via email at  jktechci@jcom.home.ne.jp.  ASET 2013 runs October 2-4, so it is important to act quickly.  MARPA hopes to see you there!

PMA Parts for Export to Europe – When is the PMA Part “Critical?”

Over the past few months, I have encountered a number of PMA exporters, and European PMA importers, who have asked for clear guidance on how to distinguish a “critical” PMA parts from a “non-critical” PMA part.

This is an important distinction because under the Bilateral Airworthiness Safety Agreement (BASA) that was signed between the United States and the European Union, there are three types of PMA parts that are accepted in the European Union (for installation on products certified or validated by EASA) without further showing.  Those three “acceptable” situations, as described in the BASA Technical Implementation Procedures (TIP) are:

(1) The PMA part is not a “critical component”;  or

(2) The PMA part conforms to design data obtained under a licensing agreement from the TC or STC holder according to 14 CFR §21.303; or

(3) The PMA holder is the holder of an EASA STC which incorporates the PMA part.

Thus, non-critical PMA parts are directly acceptable (and they should have text on their export 8130-3 tag that states “This PMA part is not a critical component”).  So there is a significant advantage to having a clear understanding of when a PMA part is critical and when it is not critical.

This can be a little confusing if you don’t know where to look.  The FAA has used the term “criticality” to define different categories of parts for approval purposes, and to set differnt levels of FAA involvement in the approval process.  The distinct use of the term means that we need to look in the right place for the definition of “critical” that applies to our export/import transactions.

For purposes of US exports of PMA parts that are imported into the European Union, the controlling guidance is found in the BASA’s Technical Implementation Procedures for Airworthiness And Environmental Certification (BASA TIP). The definition of critical component for purposes of that document is found in Section 1.6(i) of the BASA TIP:

“Critical Component” means a part identified as critical by the design approval holder during the product type validation process, or otherwise by the exporting authority. Typically, such components include parts for which a replacement time, inspection interval, or related procedure is specified in the Airworthiness Limitations section or certification maintenance requirements of the manufacturer’s maintenance manual or Instructions for Continued Airworthiness.

Don’t fall for the temptation draw a semantic difference between a “critical component” and a “critical part.”  The PMA acceptance procedures found in section 2.8.2(a)(1) of the BASA TIP explicitly cross reference the definition in section 1.6(i).

In light of this definition found in the BASA TIP, the question of whether a PMA part is “critical” will be based on the decision of the FAA (the exporting authority) about whether it was critical at the time of approval.

The regulatory guidance for critical parts is found in the marking requirements discussion in section 45.15(c) of the FAA’s regulations. That section makes it clear that an article is “critical” if it has a hard time specified in the Airworthiness Limitations section of the manual (instructions for continued airworthiness), like a life limit, then it is a critical part (or critical component).

Under normal circumstances, there are two methods for specifying such a limit on a PMA part. The first is during the FAA approval process (usually as an airworthiness limitation published in the instructions for continuous airworthiness), when the airworthiness limitation section associated with the part would be approved. The second is by an FAA airworthiness directive issued after initial approval in response to an identified safety issue.

Thus the best source for identifying whether a PMA article is “critical” is the PMA manufacturer, who should be able to tell customers whether there were any such hard times associated with the article as part of the approval process (or review of the PMA manufacturer’s instructions for continuous airworthiness).  If the FAA did not establish that the part was critical at the time of approval, and if they did not subsequently issue an airworthiness limit (such as through an airworthiness directive), then the part is not critical.

FAA Finalizes “Critical Parts” for Propellors

The FAA is has amended the airworthiness standards for airplane propellers to require TC applicants to identify critical parts.

The FAA claims that this new requirement will increase the margin of safety and also harmonize the U.S. rules with those of Europe.

The rule change affects subsections (c) and (d) of section 35.15 of the FAA regulations by revising them to the following language:

c) The primary failures of certain single propeller elements (for example, blades) cannot be sensibly estimated in numerical terms. If the failure of such elements is likely to result in hazardous propeller effects, those elements must be identified as propeller critical parts.

(d) For propeller critical parts, applicants must meet the prescribed integrity specifications of Sec. 35.16. These instances must be stated in the safety analysis.

The change in subsection (c) is that the prior language merely said that in such cases compliance may
be shown by reliance on the prescribed integrity requirements of part 35 – now these parts will have to be defined as “critical.”  In particular, single failure elements of a propeller whose failure is likely to result in a hazardous propeller effect would be described as “critical.”

The prior subsection (d) says that if the propeller relies on a safety system to prevent failure, then the failure analysis must assess the possibility of a failure in the safety system.  Under the new language, The new language will defer the analysis of critical parts to the new language of 35.16.

The rule change added a new section 35.16 that reads as follows:

  Sec. 35.16 Propeller Critical Parts.

The integrity of each propeller critical part identified by the safety analysis required by Sec. 35.15 must be established by:
(a) A defined engineering process for ensuring the integrity of the propeller critical part throughout its service life,
(b) A defined manufacturing process that identifies the requirements to consistently produce the propeller critical part as required by the engineering process, and
(c) A defined service management process that identifies the continued airworthiness requirements of the propeller critical part as required by the engineering process.

PMA manufacturers that produce propeller parts will want to look carefully at the effect this could have on future designs, and on their ability to get the FAA to approved those parts if they are deemed to be critical parts. It is also worth noting that EASA applies different standards to the import of PMAed critical parts (they are not automatically accepted and the exporter needs to obtain an EASA STC for the parts) so it will important to consider what affect this might have on your exports.

This final rule becomes effective as of March 19, 2013.

How Might REACH (European Environmental Regulations) Affect Your Business?

The U.S. Commerce Department will hold a webinar on November 29 to discuss the effect of European Evironmental Regulations on  U.S. Aerospace companies.

The European Union has a regulation called the REACH regulation.  REACH stands for Registration, Evaluation, Authorisation & restriction of CHemicals.

REACH imposes certain obligations on companies that manufacture certain chemicals in Europe, and on companies that import certain chemicals into Europe.  Under REACH, the continued marketing of substances of Very High Concern (SVHCs) requires an authorization. Businesses active in the aerospace marketplace use a number of substances that are being considered for SVHC classification, and unauthorized import into Europe of such substances could violate REACH.

For more information, see the notice on the Commerce Department website.

MARPA 2012 is the Place to Do Business: Air Carrier Update

Need to meet with air carriers about your PMA parts?  They will be at the 2012 MARPA Conference, and they will be looking for PMA solutions.

MARPA has 40 pre-registered air carrier representatives from 17 different air carriers attending the 2012 Annual Conference in Las Vegas:

  • Air Canada
  • ANA
  • Allegiant Air
  • American Airlines
  • American Eagle Airlines
  • Bismillah Airlines
  • Copa Airlines
  • Delta Air Lines
  • Horizon Air
  • Japan Airlines – JALUX
  • Kenya Airways
  • SkyWest Airlines
  • Southwest Airlines
  • United Airlines
  • UPS
  • US Airways
  • Westjet

For a complete look at the pre-registered attendees for the Conference, please be sure to check out our pre-registration list, which was published on September 22.  This list is not complete, as we always have had a significant numbers of attendees who register in the lat week or at the door; but it does provide a reasonable look at the businesses that have already made a commitment to attend.

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