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Export and Trade Compliance Policy

I. Purpose
This policy ensures that Westcon Group, Inc. and its subsidiaries and affiliates under contract with Westcon Group, Inc. or one of its subsidiaries (“Company”) comply with the applicable export, re-export, import and trade compliance laws in all countries in which the Company does business.

II. Scope
This global policy applies to the Company and its directors, officers, shareholders, employees, representatives, consultants and agents (“Representatives”) worldwide. Strict adherence to this policy is required, except to the extent that a more stringent law exists in the country in which you work. It is our policy to comply fully with applicable export and trade control laws of jurisdictions in which we operate worldwide. For example in Singapore, where we have a shipping hub, we operate in compliance with the Singapore Strategic Trade Scheme. In addition, as a U.S. headquartered company, the Company and its subsidiaries must comply with U.S. export and trade control laws which are detailed below.

III. Policy
It is the Company’s fundamental policy that all business and other activities be conducted at all times in strict compliance with all applicable laws and regulations of the countries and jurisdictions within which the Company conducts business. The purpose of this policy is to ensure that the Representatives of the Company conduct operations and activities both outside and within the United States in complete compliance with the U.S. export control laws and trade regulations applicable to its operations as administered by the U.S. Departments of Commerce, State and Treasury AND the local export and trade control laws within the jurisdiction in which they are geographically located from which products are being exported. The laws and regulations governing exports are detailed and complex, and because U.S. and other laws apply to the Company’s business dealings, all questions or concerns should be directed to the Legal Department for clarification. This policy is an integral part of our Company Business Code of Conduct which requires compliance with the laws and establishes corporate ethical standards applicable to all the Company’s business dealings.

 

  1. Trade Control Laws Generally
    All governments regulate trade through restrictions on permanent and temporary exports and imports of goods, technology, and services. Some are more restrictive than others.

  1. Overview of U.S. Export Controls

    The U.S. Departments of Commerce, State and Treasury administer significant controls on the export of goods, technology and services under the Export Administration Regulations (“EAR”). The Department of Commerce regulates the export of items and information that have civil (non-military) applications, the Department of State regulates the export of items that have military applications or that relate to space, and the Department of Treasury enforces country-specific embargoes. In certain circumstances, these agencies may require that the Company obtain a license before an item or information is exported to another country or is shared with a foreign national within the U.S. Under these regulations exports include any transfers to citizens of countries other than the United States (“foreign nationals”) even if they occur entirely within the United States or between countries outside of the United States if the export contains certain United States-origin goods or technology. The term “export” is defined as an actual shipment or transmission of items out of the United States where transmission includes, but is not limited to, distribution by facsimile and email.

    In addition to regulating the export of actual goods or commodities, U.S. export controls cover the export or release of “technical data” or technology (which includes information, whether printed, inscribed on media, or communicated orally). The release of such information is called a “deemed export.” Under this rule, the transfer or release of technical data or information subject to U.S. export controls to a ‘foreign national,” whether it occurs in the U.S. or abroad, is ‘deemed” an export from the U.S. to the home country of the foreign national. This can arise in connection with research or through collaboration or discussion of controlled technology.

    The Company will comply with all export control and import laws and regulations that govern the exportation and importation of commodities and technical data, including items that are hand carried as samples or demonstration units in luggage. The Company will screen new customers and suppliers to ensure that they do not do business with prohibited entities. The Company will obtain export licenses and other government approvals prior to exporting products and technology controlled by the United States Government.
  1. Department of Commerce Controls
    The Bureau of Industry and Security (“BIS”) of the U.S. Department of Commerce implements and enforces U.S. export control regulations relating to the export of “dual-use” goods and technologies (having both civil and military applications ) as well as exclusively civil goods and technologies. Items subject to the jurisdiction of BIS are listed on the Commerce Control List (“CCL”), found in the Export Administration Regulations published at http://www.gpo.gov/bis/ear/ear_data.html, which includes electronics, computers, telecommunications, and information security products. Whether a license is required to export or re-export an item on the CCL is determined by examining the precise classification of the item (Export Commodity Control Number or “ECCN”), the destination of the item, the reseller of the item and the end user of the item. BIS also maintains the Denied Persons List and the Entities List, which identify specific persons and entities to which exports are not permitted, located at: http://www.bis.doc.gov/dpl/default.shtm and http://www.bis.doc.gov/entities/default.htm.

  2. Department of State Controls
    The Directorate of Defense Trade Controls (“DDTC”) of the U.S. Department of State regulates the export of defense goods, technical data and defense services. DDTC administers the International Traffic in Arms Regulations (“ITAR”)

    Generally, a defense article is an item developed for a military application that does not have a predominant civilian application. Unless an exemption applies, a license must be obtained before any defense article is exported to a foreign country or foreign national. Authorization by DDTC is also required for any agreement under which a U.S. person will furnish assistance to foreign nationals in the development, design, production or use of a defense article or under which a U.S. person will license to a foreign party the right to manufacture U.S. origin defense articles abroad. DDTC maintains a list of “debarred” persons and entities whose exporting privileges have been revoked as a consequence of violations of the ITAR, located at http://www.pmddtc.state.gov/debar059.htm or the nonproliferation sanctions list located at http://www.state.gov/t/isn/c15231.htm. The index of munitions list can be found at http://www.fas.org/spp/starwars/offdocs/itar/p121.htm#ITAR.

  3. Department of Treasury Controls
    The office of Foreign Assets Control (“OFAC”) of the U.S. Department of Treasury administers and enforces certain country-specific controls that take the form of economic embargoes against countries; currently including Belarus, Burma (Myanmar), Cuba, Democratic Republic of the Congo, Former Liberian Regime of Charles Taylor, Iran, Iraq (certain exceptions apply), Ivory Coast, North Korea, Sudan, Syria and Zimbabwe. The scope of these economic and trade embargoes varies from country to country. OFAC has adopted regulations that detail the scope of the embargoes against each country.

    OFAC also maintains lists of Specially Designated Terrorists and Specially Designated Nationals and Blocked Persons, with whom U.S. persons are prohibited from engaging in any transactions due to U.S. foreign policy and national security concerns. Transfers of items and information to individuals or entities on these lists are prohibited without the prior approval of OFAC and are located at http://www.treas.gov/offices/enforcement/ofac/sdn.

  4. Penalties for Violations
    In the event of a violation of U.S. export control law, both the Company and the individuals involved in the violation may be liable. The company and the individuals involved may be subject to severe administrative and civil sanctions as well as criminal penalties. For example, “knowing” violations of the EAR are punishable by a fine of up to five times the value of the exports involved, or $50,000, whichever is greater in addition to imprisonment for up to five years. “Willful” violations can result in penalties for individuals of up to $250,000, imprisonment of up to ten years, or both. Willful violations for companies may be up to $1,000,000.00 or up to five times the value of the exports involved, whichever is greater for each violation. Exports are subject to a strict liability standard, so even negligent exports can trigger fines of $10,000 or $120,000 per violation. Penalties can also include the denial of export privileges, revocation of validated export licenses, exclusion from practice and debarment from contracting with the federal government. Almost all enforcement actions are public.

 

Importation, Country of Origin and Marking Laws

The U.S. and other countries governments have published local country customs rules and import laws and regulations that include requirements to provide: accurate documentation; appropriate country of origin markings; classification of goods; and proper valuation declarations including those of non-cash value. Additionally, the European Union has enacted the Restriction of Hazardous Substance Directive 2002/95/EC (the “RoHS Directive”) and Waste and Electronic Equipment Directive 2002/96/EC (the “WEEE Directive”). These Directives include a requirement for appropriate CE markings to be placed on items being imported into the EU. Each EU Member State has the authority to define its own implementing regulations under these Directives. There are also rules and regulations to provide access to special duty reduction programs, such as those under free trade agreements (North American Free Trade Act or “NAFTA” and the Central American Free Trade Agreement or “CAFTA”).

All Representatives are required to comply with these additional Trade Compliance obligations. False or misleading statements made on export documentation could jeopardize Westcon’s global operations and lead to audits and fines which would damage the Company’s ability to conduct business activity. All managers and employees must integrate export control procedures into their regular business processes for Westcon to have continued success in the international marketplace.

Westcon will comply with all export control and import laws and regulations that govern the exportation and importation of commodities and technical data, including items that are hand carried as samples or demonstration units in luggage. Westcon will screen new customers and suppliers to ensure that they do not do business with prohibited entities. The Company will obtain export licenses and other government approvals prior to exporting products and technology controlled by the United States Government. Failure to comply with these laws could result in heavy fines, audits, criminal charges and/or the loss or restriction of Westcon’s export or import privileges, which, in turn could seriously and adversely affect a significant portion of the Company’s business.

 

Reporting Possible Violations

  1. Reporting
    Westcon Group Representatives must comply with this Export and Trade Compliance Policy. Any questions regarding the validity or interpretation of this Policy should be brought to the attention of the Westcon Group Business Practices/Compliance Office shown below. Failure to comply with this Policy and associated Westcon Group policies will result in appropriate employee disciplinary action up to and including termination of employment.

    It is each Representative's personal responsibility to take appropriate and consistent action by informing your supervisor, management, the Legal department, the Human Resources department or the Ethics hotline of any violations or suspected violations of this Policy. If your manager or supervisor is the violator or is complicit with violations of this Policy, then report the violation directly to the Human Resources or Legal department. Violations include not only noncompliance with applicable laws, regulations and this Code, but also a failure by responsible management to detect, report and/or correct any offense. All reports will be treated as strictly confidential.

  2. Non-Retaliation
    Westcon Group policy prohibits any retaliation, directly or indirectly or by encouraging others, against employees for making reports of a violation of this Policy. If you believe retaliation has occurred, please inform the Human Resources or Legal department immediately.

 

Westcon Group Business Practices/Compliance Office
Office of Worldwide Business Operations
(914) 829-7171
ComplianceOfficer@Westcongroup.com