Export Regulatory Compliance, Licenses, and Agreements
International trade often means sending goods abroad to international customers or business partners. Exports are the other side of the trade coin. Our firm advises U.S. persons and businesses alike on how to comply with the governmental agencies that enforce U.S. export regulations and statistics, including the U.S. Bureau of Industry and Security (BIS), the State Department’s Directorate of Defense Trade Controls (DDTC), and the U.S. Census Bureau (Census).
Key Concepts
EAR: The Export Administration Regulations that govern non-military export, re-export, or transfer of commercial and dual-use goods, as administered by BIS.
ITAR: The International Traffic in Arms Regulations administered by DDTC that govern the manufacture, export, distribution, or transfer of defense-related articles, services, or technical data.
FTR: The Foreign Trade Regulations that govern the statistical nature of imports and exports arriving or exiting the U.S., as administered by Census.
Export Classification: Different than a Harmonized Tariff Schedule (HTS) code, this is the classification number assigned to a product, software, or technology upon export from the United States on either the EAR’s Commerce Control List (CCL) or the ITAR’s U.S. Munitions List (USML).
Licenses: Specific authorization from the governing agency to participate in a specific transaction for exports of goods, technology or software to a specified end-user, when required.
License Exception: A set of criteria that, if met, excuses a party from obtaining a license to export goods, software, or technology that would otherwise require a specific authorization from a governing agency.
Agreements: Specific authorization from DDTC for the manufacture, warehousing or distribution, and other technical assistance from international partners in service of U.S. defense-related articles.
Deemed Export: The visual release of or access to controlled goods, technology, or source code to a foreign national in the United States.
Background
There are multiple jurisdictions with unique regulatory considerations to consider and comply with when sending goods abroad from the U.S. Because of the distinct requirements of each jurisdiction, our firm assists clients with navigating the complex regulations to minimize risk of violations. While Census ensures accurate reporting of vital trade statistics of goods exiting the country, BIS and DDTC ensure that military or commercial goods, technology, or software exported from the U.S. do not reach restricted or prohibited parties that could use them to harm U.S. interests. Controls vary depending on the export regime and classification, combined with the country of ultimate destination and end-user of the item.
Due to the high stakes of tangible and intangible items reaching parties they shouldn’t, potential export violations can be technical (procedural) or substantive in nature. Depending on the severity of a violation, BIS, Census, and DDTC each have the authority to impose steep penalties for violations ranging from one-offs to egregious. If a company believes they have committed a historical or present violation of any nature, it is critical they consider hiring legal assistance with filing a Voluntary Self-Disclosure to the appropriate authorities and cooperate with the corresponding agency to investigate the matter.
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What we Do
We assist clients in assessing specific transactions for export compliance risk, conducting due diligence on the Foreign Principal Party in Interest (FPPI) involved in the transaction, managing regulatory exposure, and responding to enforcement inquiries or actions. If needed, we also assist with applying for the appropriate jurisdiction’s export license or agreement. Our firm combines subject matter expertise with a practical understanding of the distinct jurisdictions and evolving regulatory frameworks for newer technologies. The result is helping clients operate confidently in a complex export environment.
Our export compliance practice focuses on key aspects of effective programs, including:
- Proper Jurisdiction Determinations
- Export Classification Determinations and Rulings
- Commodity Classification Automated Tracking System Requests
- Commodity Jurisdiction Requests
- License Determinations or Availability of License Exceptions
- Deemed Exports
- Voluntary Self-Disclosures
- Export Risk Assessments and Risk Mitigation
- Records Retention
- Screening End-Users and Affiliates Rule Applicability
- ITAR Agreements (MLAs, TAAs, WDAs)
- EAR License Applications
- ITAR License Applications
- BIS/DDTC/Census Requests For Information and Enforcement Actions
- Transaction Due Diligence
- Export Compliance Programs and Policy
- Internal Audits
- Consent Agreements
- Transaction Viability
- Interim Final Rules Analysis and Applicability
- Interpretive Guidance and Advisory Opinions
- Remediation Measures