This Policy supersedes the Terex Corporation Policy on Transactions in Iran, dated June 7, 2013.

Transcription

1 TEREX CORPORATION POLICY REGARDING TRANSACTIONS IN IRAN (the Policy ) applies to all Terex operations and Terex team members worldwide. This Policy supersedes the Terex Corporation Policy on Transactions in Iran, dated June 7, 2013., effective February 12, 2016

2 Table of Contents I. INTRODUCTION... 3 II. SCOPE... 3 III. POLICY... 3 A. Terex U.S. Entities and U.S. Based Team Members, Terex U.S. Citizens and Permanent Residents Working Outside of the U.S., Exports from the U.S. and Certain Terex Systems Hosted In the U.S B. Terex Non-U.S. Subsidiaries... 3 IV. PROCEDURES FOR TRANSACTING BUSINESS IN IRAN FOR TEREX NON-U.S. SUBSIDIARIES ONLY... 4 A. There Must Be a Known Final End-User... 4 B. No Party to an Iranian Transaction May Be Listed On a Sanctions List... 4 C. U.S. Content... 5 D. The Final End-Use Must Be Specifically Known And Permissible E. Payment... 6 V. THIRD PARTIES... 7 A. Iranian Transactions through Third Parties Are Permissible... 7 VI. BUSINESS UNIT OBLIGATIONS... 7 A. Business Unit and Business Leader Responsibility... 7 B. Team Member Responsibility... 7 VII. VIOLATIONS OF THIS POLICY... 8 A. Reporting Violations... 8 VIII. RETALIATION IS PROHIBITED... 8 IX. DISCIPLINE... 8 X. RESOURCES AVAILABLE TO TEAM MEMBERS... 8 XI. DEFINITIONS

3 I. INTRODUCTION Terex Corporation favors an open trading system. The Terex Corporation Code of Ethics and Conduct (the Code ) requires Terex team members to comply fully with applicable export control laws and regulations, the Terex Corporation Export Controls and Trade Sanctions Policy (the Export Controls Policy ) and this Policy. II. SCOPE This Policy applies to all Terex team members and all Terex operations worldwide. III. POLICY A. Terex U.S. Entities and U.S. Based Team Members, Terex U.S. Citizens and Permanent Residents Working Outside of the U.S., Exports from the U.S. and Certain Terex Systems Hosted In the U.S. Terex Corporation, Terex U.S. subsidiaries, Terex team members working in the U.S. and Terex team members that are U.S. citizens and permanent residents working outside of the U.S. (including team members with dual citizenship status) may not facilitate or transact any Terex business that is from or destined for Iran. This prohibition includes, but is not limited to, quotes, orders, discount approval, credit approval, shipping routes through Iran, servicing, technology transfers, expense report approval or any other form of transaction. Exportation or re-exportation of equipment, parts, components, technology, software or services from the U.S. into or transiting through Iran is prohibited. i Terex systems hosted in the U.S. that are for external use, such as e-commerce systems or dealer portals, must prohibit access for parties located in Iran and any transactions into Iran. B. Terex Non-U.S. Subsidiaries Terex non-u.s. subsidiaries may export or import equipment, parts, components, technology, software and service into or from Iran provided that applicable local laws and regulations and the procedures below are strictly followed. 3

4 IV. PROCEDURES FOR TRANSACTING BUSINESS IN IRAN FOR TEREX NON-U.S. SUBSIDIARIES ONLY A. There Must Be a Known Final End-User 1. The final end-user of the equipment, parts and components, the recipient of service, and the licensee or user of technology or software must be known at the time of the order. Transactions for stock are not permitted for Covered Third Parties located in Iran or if the stock is specifically purchased by a Covered Third Party located outside of Iran for future sales or service in Iran. 2. The use of on-line or web-based Terex technology or software-related services, such as on-line diagnostics, is prohibited unless the final end-user is known. For example, a distributor may not use Terex on-line diagnostic technology to analyze an Iranian customer s equipment without first disclosing the final end-user and end-use of the equipment. B. No Party to an Iranian Transaction May Be Listed On a Sanctions List 1. Iranian transactions with any party listed on a sanctions list, including but not limited to the U.S. Specially Designated Nationals and Blocked Persons List (SDN), the U.S. Foreign Sanctions Evader List, and any EU, U.S. or other applicable sanctions list is prohibited. 2. All parties to the transaction in Iran must be identified and screened using a Terex authorized screening solution (e.g. Kewill). Parties to the transaction include, but are not limited to: a) The final end-user, including all owners of the final end-user; b) All Covered Third Parties, no matter where located; c) Any supplier, including all owners of the supplier, when purchasing materials, parts or other items from Iran; d) All banks and financing companies, without exception; e) Any party assisting with commissioning, including all owners, no matter where located; and, f) Any other party that is in anyway involved in the transaction, including all owners, no matter where the party is located. 4

5 3. All owners of every party to an Iranian transaction must be screened if screening of party ownership is required pursuant to Section IV.B.2. It is important to understand complete party ownership. For example, Iranian Customer A is owned by Company B and Individual C. Iranian Customer A, Individual C and all owners of Company B must be screened. If Company B is owned by Companies D and E, all owners of Companies D and E must be identified and screened. Identification and screening should continue until all owners have been vetted through Kewill. If a public company is involved in the transaction, any person or company that owns 5% or more of the public company must be identified and screened. 4. Continuous trade screening of each party to the transaction is available through Kewill s RDPS trade screening solution ( RDPS ). In lieu of trade screening through RDPS, the following trade screening protocols are required: a) All parties to a sales or warranty transaction must be screened at order entry and prior to shipment. The 72 hour rule under the Export Controls Policy does not apply. b) All parties to a service transaction must be screened immediately prior to performing the service. c) All parties using on-line or web-based Terex technology or software must be screened prior to each use. d) For all other transactions, all parties must be screened before proceeding. 5. Transactions, including tenders, that in any way involve the military, paramilitary, intelligence, or law enforcement entity of the Government of Iran, or any official, agent or affiliate thereof, are prohibited. C. U.S. Content 1. Equipment, parts, components, technology or software destined for use in or transiting to Iran must have less than 10% U.S. Controlled Content. 2. A U.S. content calculation for equipment sales, based on the Bill of Materials, must be submitted to a member of the Terex Ethics & Compliance team for review to confirm that the transaction complies with U.S. sanctions requirements prior to shipment or delivery of services. 5

6 D. The Final End-Use Must Be Specifically Known And Permissible. 1. The specific use of the equipment involved in the transaction must be disclosed. End-uses that are vague are not acceptable. Vague end-uses include lifting, heavy lifting, screening, etc. 2. No Terex equipment, parts, components, service, technology or software may be used in connection with any of the following end-uses: a) Proliferation of any type of weapons of mass destruction or delivery systems for weapons of mass destruction (such as missiles, rockets or unmanned vehicles); b) Chemical, biological or nuclear weapons; c) Military, paramilitary, intelligence, or law enforcement activities of the Government of Iran; d) Terrorism-related activities or for any parties engaged in terrorismrelated activities; e) Human rights abuses in Iran or Syria; f) Support or assistance of the Government of Syria or others designated as providing support or assistance to the Government of Syria; and, g) Any acts that threaten the peace, security and stability of Yemen. 3. Nuclear-related activities, other than those related to nuclear weapons, may be permissible if the activity is subject to the procurement channel established pursuant to paragraph 16 of the United Nations Security Council Resolution 2231 and Section 6 of Annex IV to the Joint Comprehensive Plan of Action of July 14, 2015 and any other applicable laws, resolutions or regulations. E. Payment Payment for sales, services, technology or software may not be made in U.S. dollars or involve U.S. banking institutions. This includes, but is not limited to, Letters of Credit, financing through Terex Financial Services, Inc. and processing payments through the U.S. Global Business Services function. 6

7 V. THIRD PARTIES A. Iranian Transactions through Third Parties Are Permissible 1. In addition to the Procedures set forth in this Policy, any non-u.s.terex subsidiary using a Third Party to transact business in Iran must comply with the Terex Corporation Rules for Doing Business with Third Parties, as amended from time to time, regardless of location of the Third Party. For example, if a Terex Business sells parts into Iran through a distributor located in Turkey, the Terex Business must ensure that all requirements under the Terex Corporation Rules for Doing Business with Third Parties are met. 2. All Covered Third Parties that are transacting or plan to transact Terex business in Iran must complete the Terex Reputational Due Diligence Process, even if the Covered Third Party is a Legacy Third Party. Reputational Due Diligence exemptions do not apply to any Covered Third Party that is transacting or plans to transact Terex business in Iran. 3. No Terex business may use a Covered Third Party, a rental house or other Third Party to circumvent this Policy. VI. BUSINESS UNIT OBLIGATIONS A. Business Unit and Business Leader Responsibility 1. Each Terex business unit is responsible for establishing written procedures that implement the specific requirements of this Policy. The business unit leader (for example, General Managers, Managing Directors) must ensure that the procedures satisfy the requirements of this Policy. 2. Each Terex business unit is responsible for ensuring that all team members involved in export-related activities are aware of and understand and abide by this Policy. B. Team Member Responsibility Terex team members involved in export-related transactions own the transaction, have an obligation to understand the transaction and raise questions if something about the transaction does not seem right. In any situation in which the team member is uncertain, there appears to be a warning sign or Red Flag about the transaction or if someone refuses to provide information requested about a transaction, contact the Ethics and Compliance Team or any attorney in the Terex Legal Department before proceeding further with the transaction. 7

8 VII. VIOLATIONS OF THIS POLICY Terex will not tolerate conduct that violates this Policy. Terex executive leadership fully supports any team member who declines an opportunity or refuses to make a shipment or participate in a transaction that violates this Policy or that would compromise the ethical principles or reputation of Terex. A. Reporting Violations Immediately report any violation or suspected violation of the Export Controls and Trade Sanctions laws and regulations, the Terex Code, the Export Controls Policy or this Policy to any of the following: Any member of the Terex Ethics and Compliance Team, Any attorney in the Terex Corporation Legal Department, or The Terex Helpline, available from the Terex Global Intranet, the internet at or via telephone. Please see Page 30 of the Terex Code of Ethics & Conduct (the "Terex Code") for information about access to the Terex Helpline by telephone. Confidential reporting is available through the Terex Helpline, 24 hours a day, and 7 days a week. VIII. RETALIATION IS PROHIBITED Retaliation against anyone who reports a potential violation of applicable Export Controls or Trade Sanctions laws and regulations, the Terex Code, the Export Controls Policy or this Policy in good faith, or who participates in an investigation, is strictly prohibited. Retaliation will lead to discipline, up to and including termination, in accordance with applicable law. IX. DISCIPLINE Compliance with this Policy by all Terex team members is mandatory. The Company has zero tolerance for failure to comply. In accordance with the Terex Code and in compliance with local labor laws, Terex will take action against any team member who violates applicable Export Controls or Trade Sanctions laws and regulations, the Terex Code, the Export Controls Policy or this Policy, including reprimand, suspension, financial penalty or immediate employment termination, as appropriate. Team members who fail to report circumstances that may indicate a violation, or who unreasonably fail to detect a violation of this Policy, may be disciplined, even if they were not involved in the conduct that gave rise to the Policy violation. X. RESOURCES AVAILABLE TO TEAM MEMBERS If you have any questions regarding Export Controls or Trade Sanctions laws, regulations, the Terex Code, the Export Controls Policy or this Policy, there are several avenues available to you. You may direct questions to: Your Manager, Your General Manager, 8

9 Your site s Export Control Officer/Manager/Coordinator, Your site s BPA, Any member of the Terex Ethics and Compliance Team, Any attorney in the Terex Corporation Legal Department, or The Terex Helpline, available from the Terex Global Intranet, the internet at or via telephone. Please see Page 30 of the Terex Code for information about access to the Terex Helpline by telephone. Confidential reporting is available through the Terex Helpline, 24 hours a day, and 7 days a week. XI. DEFINITIONS A. U.S. Controlled Content: The amount of U.S. origin content contained in equipment, parts, components, technology, software or services that are subject to export controls by the U.S.; such products, technology or services are regulated under the U.S. Export Administration Regulations and listed on the U.S. Commerce Control List because they have commercial (civil) and military or other restricted application. B. Covered Third Party: A Covered Third Party is a 1. Dealer, distributor, sales representative, reseller, broker or freight forwarder, and 2. A consultant, contractor, non-sales-representative, non-sales agent, travel agent or similar contracting party located anywhere who is likely to have contact with a Public Official on behalf of Terex. C. Legacy Third Party: A Legacy Third Party is a Covered Third Party that has regularly worked with Terex prior to January 2010 and has not previously completed the reputational due diligence process review. D. Public Official: A Public Official is anyone acting in an official capacity for, or on behalf of, a national, regional or local government, an agency, department of instrumentation of a national, regional or local government, a government-owned or controlled company, a state-owned or controlled entity, a public international organization, such as the World Trade Organization, or a political party, party official or candidate for political office. E. Third Party: Any person or entity transacting business or otherwise acting on behalf of Terex. i Export or re-export to Iran of Commercial Passenger Aircraft and related parts and services from the U.S. may be permissible provided that one or more required license are obtained from the U.S. Government. 9