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OVERVIEW OF EXPORT CONTROL ISSUES
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UNITED STATES EXPORT LAWS AND REGULATIONS
Export of Defense Articles, Defense Services
and Technical Data
Export of Dual Use Commodities and Technical Data
Arms Export Control Act
Export Administration Act
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Enabling Status
International Traffic in Arms Regulations (ITAR)
Export Administration Regulations (EAR)
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Regulations
U.S. Department of State, Bureau of
Political-Military Affairs, Directorate of
Defense Trade Controls (DDTC)
U.S. Department of Commerce, Bureau of Industry
and Security (BIS)
Department and Office Administering
the Regulations and Issuing The Licenses
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UNITED STATES EXPORT CONTROL SYSTEM
The export control system's three principal
functions are to
1 Identify technologies and products that need
to be controlled
2 Review and evaluate export license applications
3 Enforce Export Controls
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Reasons for Control

• Some of the reasons that the U.S. government has
  export controls in place are
• Foreign Policy
• National Security
• Human Rights Issues
• Regional Stability
• Proliferation Issues

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INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (ITAR)

• Administered by U.S. Department of State
• Applies to Export of Arms, Ammunition and
  implements of war on the U.S. Munitions List
  (USML)
• Controls U.S. Exports of all USML products,
  technical data and defense services
• Controls foreign
• Re-Exports of all U.S. origin products and
  technical data
• Exports of U.S. origin parts and components
  incorporated in foreign products
• Exports of Non-U.S. products manufactured using
  U.S. origin technology

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EXPORT ADMINISTRATION REGULATIONS (EAR)

• Administered by the U.S. Department of Commerce
• Applies to Commercial and Dual Use Commodities
• Controls U.S. Exports Using Three General Policy
  Guidelines
• Controls should be used on exports which would
  make a significant contribution to the military
  potential of any other country or combination of
  countries which would prove detrimental to the
  national security of the U.S.
• Controls should be used where necessary to
  further significantly the foreign policy of the
  U.S. or to fulfill its declared international
  obligations
• Controls should be used where necessary to
  protect the domestic economy from the excessive
  drain of scarce materials and to reduce the
  serious inflationary impact of foreign demand
• Controls Foreign
• Re-Exports of all U.S. origin products and
  technical data
• Exports of U.S. origin parts and components
  incorporated in foreign products

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• WHAT DETERMINES IF AN ITEM IS A
• DEFENSE ARTICLE?
• (ITAR 120.3)
• It is specially designed, developed, configured,
  adapted, or modified for a military application,
  and
• It does not have predominant civil applications,
  and
• It does not have performance equivalent (defined
  by form, fit, and function) to those of an
  article or service used for civil applications
• or
• It is specifically designed, developed,
  configured, adapted, or modified for a military
  application, and has significant military or
  intelligence applicability such that control
  under the ITAR is necessary.

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Commodity Jurisdiction

• If your product/technology does not clearly fall
  within one of the USML categories, then you need
  to apply for a Commodity Jurisdiction.
• The Commodity Jurisdiction is where the DDTCs
  Office of Defense Trade Controls Policy (DTCP).
  will review your information to determine if the
  item is under the USML, has a strictly commercial
  application or dual use purpose.

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INTERNATIONAL TRAFFIC IN ARMS
REGULATIONS (ITAR)
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WHAT IS COVERED BY THE UNITED STATES MUNITIONS
LIST Defense Articles Defense
Services Technical Data
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WHAT IS A DEFENSE SERVICE? (ITAR 120.9) The
furnishing of assistance (including training) to
foreign persons, whether in the United States or
abroad in the design, development, engineering,
manufacture, production, assembly, testing,
repair, maintenance, modification, operation,
demilitarization, destruction, processing or use
of defense articles or The furnishing to
foreign persons of any technical data controlled
under the ITAR, whether in the United States or
abroad or Military training of foreign units and
forces, regular and irregular, including formal
and informal instruction.
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• WHAT IS TECHNICAL DATA?
• (ITAR 120.10)
• Information which is required for the design,
  development, production, manufacture, assembly,
  operation, repair, testing, maintenance or
  modification of defense articles.
• This includes information the form of blueprints,
  drawing, photographs, plans, instructions and
  documentation.
• Software including, but not limited to, the
  system functional design, logic flow, algorithms,
  application programs, operating systems and
  support software for design, implementation,
  test, operations, diagnosis and repair.

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• WHAT IS NOT TECHNICAL DATA?
• (ITAR 120.10)
• Information concerning general scientific,
  mathematical or engineering principles commonly
  taught in schools, colleges, and universities or
  information in the public domain.
• Basic marketing information on function or
  purpose or general system descriptions of defense
  articles.
• As a general rule, if you would give the
  information to your closest competitor, it
  probably is not considered technical data.

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• WHAT IS INFORMATION
• IN THE PUBLIC DOMAIN?
• (ITAR 120.11)
• Information which is published and which is
  generally accessible or available to the public
• Through sales a newsstands and bookstores
• Through subscriptions which are available without
  restriction to any individual who desires to
  obtain or purchase the published information
• Through second class mailing privileges granted
  by the U.S. Government
• At libraries open to the public or from which the
  public can obtain documents

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• WHAT IS INFORMATION
• IN THE PUBLIC DOMAIN? (cont)
• (ITAR 120.11)
• Information which is published and which is
  generally accessible or available to the public
• Through patents available at any patent office
• Through unlimited distribution at a conference,
  meeting, seminar, trade show or exhibition,
  generally accessible to the public, in the United
  States
• Through public release after approval by the
  cognizant government department
• Several others

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Clearing Documents for Public Release

• If you have a document (paper, presentation, data
  sheet, etc) that you would like to put into the
  public domain you have two choices
• If the information is owned by a U.S. government
  program, you need to contact the program office
  (likely public affairs) and request permission
  for release
• If the information is not owned by any or by a
  specific government program, then your request is
  sent to the Office of Security Review (OSR)

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EXPORT AUTHORIZATIONS Permanent Export License
for hardware and certain technical
data Temporary Export License for trade shows
or demonstration of U.S. hardware
or return
to a foreign vendor for repair Temporary Import
License U.S. demonstrations/exhibits of
foreign- origin items Exemptions for
Export/Import of Hardware Technical Assistance
Agreement (TAA) for the performance of a defense
service or the disclosure of technical
data Manufacturing License Agreement (MLA) for
the manufacture of defense articles abroad which
involves the export of technical data or defense
articles or the performance of a defense
service Exemptions for Export of Technical Data
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FOCUS ON TECHNICAL DATA
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• HOW IS TECHNICAL DATA EXPORTED?
• Contrary to the ordinary meaning of the word
  export, an export of technical data under
  United States export laws is not limited to the
  physical conveyance of technical data to a person
  or location outside the national boundaries of
  the United States.
• Instead, export in the context of technical data
  means any release (verbal, visual, etc) of
  technical data from the United States with the
  knowledge or intent that the data will be shipped
  or transmitted from the United States to a
  foreign country.
• Technical data is exported upon release to a
  foreign person whether in the United States or
  abroad.

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• HOW IS TECHNICAL DATA EXPORTED?
• Technical Data is considered to have been
  exported if
• It has been shipped or transmitted out of the
  United States. This includes a letter, telex,
  facsimile, e-mail, and telephone
• It has been disclosed to foreign nationals in the
  United States
• It was included in oral discussions with a
  foreign person in the U.S. or abroad. This
  includes trade shows and seminars where foreign
  persons are present or
• If personal knowledge or experience, gained in
  the United States, has been applied abroad.

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• TECHNICAL DATA EXEMPTIONS
• (include, but not limited to, the following)
• Copies of technical data previously authorized
  for export to same recipient
• Basic operations, maintenance, and training
  information relating to equipment authorized for
  export to the same recipient
• Technical data being returned to original source
  of import
• Technical data to be used overseas solely by U.S.
  persons
• Technical data in furtherance of a technical
  assistance agreement or a manufacturing license
  agreement approved by the Directorate of Defense
  Trade Controls

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TECHNICAL DATA EXEMPTIONS Qualifying for an
exemption does not mean that we can just release
the technical data without any further
thought. To claim an exemption, the proper
certification must be made on the technical data
or letter containing the technical data, e.g. 22
CFR 125.4(b)(5) applicable would be the
certification for operation and maintenance
manuals.
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Making An Export

• Filing of the License
• Documentation
• Hand Carrying Items Self Endorsement/Letters
• Verbal
• Mailing
• Electronic (email)
• Filing with Customs (Automatic Export System
  AES)
• Use of Freight Forwarder
• File on your own (Contact BIS Training and
  Certification)

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Compliance Program

• The key to any good export/import compliance
  program is
• training and
• documentation.

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Training/Compliance Reviews

• Training Management, Purchasing, Engineers,
  Contracts, Shipping/Receiving, Accounting
• Training Materials and Records
• Self Assessments/Audits

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Documentation

• Commodity Jurisdiction requests
• Commodity Classification Requests
• Bad guy check
• Applications and supporting data
• Licenses and Agreements
• Commission reports
• Annual reports of Sales or Transfers (MLA)

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Documentation

• Technology Control Plan
• Non US Visitors
• Non US Employees/Contractors
• Foreign Briefings and Hand-carrying Letters
• Instructions to shippers/freight forwarders
• AES filings
• Duty Free Entry Instructions
• Exemptions/Exceptions

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Documentation

• Correspondence to DoS/DoC
• Execution/ Non-execution of Agreements
• Return of Licenses
• Initial exports under Agreements
• Request to Review Provisos
• Marking Documents
• Destination Control Statements
• Exemptions, Licenses, Agreements
• Marking even to other US Entities

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VIOLATIONS AND PENALTIES (ITAR 127)
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• VIOLATIONS
• To export or attempt to export defense articles,
  defense services, or technical data without the
  written approval from the Directorate of Defense
  Trade Controls
• To import or attempt to import any defense
  article whenever a license is required without
  such license
• To conspire to export, import, re-export or cause
  to be exported, imported, or re-exported any
  defense article, defense service, or technical
  data without the required written approval from
  the Office of Defense Trade Controls
• To violate any of the terms or conditions of
  licenses or approvals granted by the Office of
  Defense Trade Controls

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• PENALTIES
• CIVIL
• May not exceed 500,000 for each violation
• May be denied export privileges for some period
  of time
• Can be imposed on the company and individuals

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• PENALTIES
• CRIMINAL
• For each violation, a fine of not more than
  1,000,000 or imprisonment of not more than 10
  years or both may be applied to any person who
• willfully violates any provision of the Arms
  Export Control Act or the International Traffic
  in Arms Regulations, or
• willfully makes an untrue or misleading statement
  of a material fact in a registration or request
  for export authorization, or
• willfully omits to state a material fact in a
  registration or request for export authorization.

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INDICATIONS OF POTENTIALLY ILLEGAL EXPORTS

• The customer's/purchaser's agent is reluctant to
  provide the end-use or end-user information
• The performance/design requirements are
  incompatible with the destination country's
  resources or environment, or with the consignee's
  line of business.
• The stated end-use is incompatible with the
  customary or known industrial application for the
  equipment being purchased.
• The stated end-use is incompatible with the
  consignee's line of business.
• Little or no customer business background
  information is available.
• The customer is willing to pay cash for a large
  item or order.
• There is an apparent lack of customer familiarity
  with the commodity's performance/design
  characteristics or uses.
• The customer/purchasing agent refuses
  installation or service contracts that are
  normally accepted in similar transactions.
• There are ill-defined delivery dates or the use
  of delivery locations that are inconsistent with
  the type of commodity or with established
  practices.
• Freight forwarders are used as ultimate
  consignees.
• Intermediate consignees are used whose
  location/business is incompatible with the
  purported end-user's name of business or
  location.
• The packaging or packing requirements are
  inconsistent with the shipping mode and/or
  destination.
• Evasive responses are given to questions
  regarding any of the above, as well as whether
  equipment is for domestic use, export, or
  re-export.

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Resources

• Department of State/Commerce
• DoS Website www.pmddtc.state.gov/
• DoC Website www.commerce.gov/
• Bureau of Industry and Security (BIS)
• www.bis.doc.gov
• Society for International Affairs (SIA)
• http//www.siaed.org/
• Local Colleges and Universities