When I began to think seriously about niching down on the international trade practice the extend of my knowledge of export controls was a lesson during International Trade Law class sufficient at the time to spot the issues and ask the questions when I saw an export controls clause on a contract. I remember the first time I heard about export controls to have a quizzical look on my face with the thought “export what?” and “Why controls?” So, if you’re in the same boat like I was before to have never heard of export controls or you hear about China and Russia and export controls you may have the same question: Why? Why export controls?
The United States controls the export of sensitive items, technologies, and defense services for foreign policy, national security and domestic security while allowing U.S. companies to engage in international and domestic commercial activities. The Export Administration Regulations (“EAR”) implemented by the Department of Commerce and the International Trade in Arms Regulations (“the ITAR”) implemented by the Department of State are the two main export controls regulations in the United States. The Treasury’s Office of Foreign Assets Control (“OFAC”) administers and enforces economic and trade sanctions.
Before a U.S. company can export controlled items, technology, or technical data, or defense services a company must first seek and receive authorization from the U.S. government. In addition, foreign companies in possession of U.S. export-controlled items, technology, software, or technical data, or non – U.S. items produced using U.S. technologies, technical data or defense services must also seek authorization from the U.S. government before re-exporting or transferring. Last, the deemed export rule requires U.S. companies to seek and receive authorization from the U.S. government before releasing any technology or technical data or providing defense services or providing access to facilities with controlled items to foreign persons in the United States. U.S. persons, which includes U.S. citizens, permanent residents, and persons granted status as “protected individuals” are exempt from the deemed export rule.
If you’re a U.S. company that either produces export-controlled items, technologies, software, or technical data, or provides defense services, it is imperative you educate your employees on export controls so they can understand the fundamentals of export controls sufficient to raise the right questions and alert the compliance or legal department of an export control issue. It is, therefore, important for a company of any size to provide training for the employees that need to know about export controls and provide to them the resources where they can go to get help.
To determine if an item, technology, software, technical data, or defense service is export controlled a company can do a self – assessment or can file a request for Commodity Jurisdiction (CJ) determination. For your ease of access, click on this flow chart provided for you to determine if an item is export controlled.
If you have specific questions about export controls issues you are facing reach out directly to email@example.com or call +1.734.746.5006.