2011 Q&A Archive

 

 

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What does EAR stand for?

Export Administration Regulations.


What does ITAR stand for?

International Traffic in Arms Regulations


I am just exporting a pocket calculator, does the EAR say I have to get a license?

An export license may be required if any of the following are present in your transaction:

  • the item you are exporting has an ECCN that requires a license for the country OR
  • any party in the transaction is on a US prohibited parties list or denial lists OR
  • the item will be used in a prohibited nuclear, missile, or chemical/biological weapons activity OR
  • your export is to Cuba, Iran, North Korea, Sudan or Syria OR
  • you are exporting to a military end-use in China and your item is in an ECCN that requires a license for a military end-use in China OR
  • there is something suspicious about the transaction that raises a red flag that one of the above may be true

How can I tell if my item is covered by the EAR or the ITAR or both?

Generally an item is never covered by both. The first step is to go to the United States Munitions List (USML) if the USML describes your item then it is under ITAR jurisdiction, even if it is described in the Commerce Control List.


Do you have a list of export acronyms?

We offer a complete list of export acronyms which is also provided in our comprehensive seminar manuals. Seminar participants receive this manual and we also sell our manuals to individuals who are unable to attend our live or online EAR and ITAR training.


We have an affiliate company in Switzerland that is licensed to produce and sell one of our proprietary alloys (aluminum). Our company in the US submitted a CJ request for this alloy and it has been deemed an ITAR Controlled item under USML Category XIII (e).

Our Switzerland affiliate wants to produce this alloy and sell it to other foreign countries (not to US) according to US MIL-DTL-32341 specifications. Can our Swiss company do this? Thanks in advance for your clarification regarding this question.

The use by a foreign person outside of the United States to produce an alloy according to US MIL-32341 specifications that are freely available to any member of the public without restriction does not require ITAR authorization.

If you provide assistance to a foreign person (e.g., your Switzerland affiliate) to produce a US origin or non-US origin "defense article," then most likely you would be providing an ITAR "defense service" which normally requires ITAR authorization.  If you export "technical data" to the foreign person you normally would have to get ITAR authorization.

The ITAR definition of "technical data" excludes a mil spec that is freely available to anyone without restriction (e.g., over the internet).  However, if you help someone use such a mil spec to produce a US or non-US origin defense article, you likely are providing an ITAR "defense service" which requires authorization.


What are the licensing requirements for a foreign national of an international company with business units in the US for which the foreign national will analyze non-licensable EAR controlled items using a licensable ITAR controlled item at the US facility?

Will this require an export license or is it exempt from licensing?

I am not sure if I understand exactly everything going on here.  A human "foreign person," as defined by the ITAR, will have access to EAR items that do not require a license for that human's country and will have access to an ITAR "defense article" in the United States. 

The question is, is there an ITAR "export" here.  Go to ITAR 120.17 for the definition of "export."  I see two possible issues: 

First, will the foreign person's access to the "defense article" result in the export of "technical data" to the foreign person?  So, will the foreign person get technical data in written, electronic or oral form related to the defense article, and will the foreign person be able to absorb or see technical data as a result of being able to use the defense article.  (Note:  Any information that is ITAR "public domain" is not ITAR "technical data" so if the foreign person only absorbs "public domain" information there is not an ITAR export of technical data.)

Second, is the foreign person receiving a "defense service" (see ITAR 120.9) while in the United States.  Even if there is no export of technical data (for example, all of the information is "public domain"), if the US company provides assistance related to the operation of a defense article, then the US company is providing a defense service.

If there is a technical data export or a defense service issue, you need ITAR authorization.  There is not enough information in your question to tell you whether you are eligible to do it under an ITAR exemption or whether you would have to get DDTC to approve a license or agreement for this activity.


In regard to 3rd country nationals to a Training Assistance Agreement I understand the limits, provisos, and unique issues of not only nationalities, but place of birth as well.

My question is for the Employees of Non-US End-Users and Consignees to a Training Assistance Agreement.

1. For instance if a United Arab Emirate National is a Consignee nationality authorized by the TAA to assist in an export…..Does it matter if the individual was born in a proscribed country?

2. If so, What are the requirements for ITAR compliance?

Thanks in advance for your time and consideration. Any information you can provide will be greatly appreciated.

The ITAR does not tell you how to determine the country or countries you should attribute to a specific "foreign person."  The ITAR does not say you should use country of birth or citizenship.  DDTC has refused to use the ITAR to address this issue.

In various places outside of the ITAR DDTC has said things such as country of birth is a factor when considering nationality.  That is not definitive and is not a definition.  For example, if a person is born in the PRC and leaves at age of one month and never returns, is that person a PRC national?  Or what if a person was born in the UK and has UK citizenship but visits the Chinese Army in China every other month? 

So, because DDTC will not give you an ITAR definition, that means your company, like every other company, should determine who you are going to determine what country to attribute to a human who is a "foreign person."  Some companies just look at passport/citizenship and other companies look at passport/citizenship and country of birth, other companies look at passport/citizenship and then determine on a case-by-case basis when country of birth should influence the decision.  Some companies are in countries where it is illegal to ask about a person's country of birth so they might not want to violate local laws in order to try to comply with a vague and intentionally undefined ITAR concept.

Your company should decide how it wants to handle this.  I find many companies have a policy of looking at citizenship/passport and do not ask for other information.  That is reasonable and defend-able.  If DDTC ever contacts your company individually and tells you how it wants your company to deal with this, you should do what DDTC says unless you can negotiate something else.

So, finally, to answer your question, if your company policy is to use country of birth, then a UAE citizen who was born in the PRC should be treated as being two countries, the UAE and the PRC.  If the PRC is not approved under the agreement, that person may not be involved in the ITAR-controlled activities authorized by the agreement.


I would appreciate gaining more knowledge and know how of export compliance regulations to Monrovia, Liberia.

We are a manufacturing company of medical instruments which are classified as EAR99. We are interested in exporting to Liberia and have reviewed the SDN list, our potential customer is not listed.

Please point me in the right direction with regards to US compliance regulations and required documentation (i.e. commercial invoice, packing list, etc.)

You are on the right track.  The Export Administration Regulations (EAR) and the various regulations administered by the Office of Foreign Assets Control have primary jurisdiction over your transaction.  Download the free Export Compliance Dashboard at www.learnexportcompliance.com and it will direct you to those regulations.  Exports of EAR99 for final destination Liberia is not subject to significant US restrictions as long as none of the parties in the transaction are on any of the US denial lists (there are other lists in addition to the SDN list you mentioned).  You may access those lists on the Dashboard too.

Regarding export documentation, Part 758 of the EAR is a key place to look and also look at the Foreign Trade Regulations, which once again you may access on the Dashboard.


My question is that we have a lot of brokers that send us ITAR units, but we ship them back to the broker and then the broker ships them back to the customer that is foreign military. Do I need to have an exemption statement listed on their packing slips? If so, what exemption are they?

Before we can answer your questions we will need to know the following things:

1) What countries are the brokers in? USA

2) What does your company do with the units? REPAIR

3) When you say the brokers send the units to you do they always send them to you in the United States? YES

There are no ITAR requirements for transferring items to parties in the United States unless the party is a foreign government or its agents/representatives or unless you are transferring items to a party who is going to export them for you.  (I will assume you are caught by either of the exceptions I just mentioned.  Let me know if that is an incorrect assumption.)

So, when there are no ITAR requirements, you do not use an ITAR exemption when you transfer items to parties in the United States.  Even though there is no ITAR requirement, it might be a prudent policy and procedure to do one or both of these things even though they are not required by the ITAR:

1) Have a written agreement between you and each broker in which the broker acknowledges it is responsible for ITAR compliance specifically, and export compliance in general, for any items it receives from you and subsequently exports.  Include in the agreement a clause in which the broker agrees not to show you as exporter or USPPI on any document.

2) When you deliver ITAR items to a party in the United States, have a clear and obvious statement on the documents that accompany the items saying the items are controlled by the ITAR.


Is a company required to provide a report of exemptions?  I know reporting must be kept to monitor the # of shipments and ensure we are not going over the 24 max limit. If reporting is required, what data must be included on the report?

Generally you do not have to provide a report to DDTC when you use exemptions but you do have to keep records of all exports under an exemption.  Here are some key exceptions to that general rule:

--Certain exemptions specifically require a report of some sort.  The reporting requirements are specifically stated in the provisions of the exemptions.  For example, 123.16(b)(4) requires that the exporter make a specific certification/report to Customs, and the Canadian defense services exemption in 126.5(c) requires semi-annual report to DDTC.

--123.22(b)(3) describes certain reporting requirements for exports pursuant to an agreement (you use an exemption when you make an export authorized by an agreement) and exports pursuant to exemptions and licenses.

--When you export under an exemption pursuant to an agreement, the agreement itself or the provisos to the agreement may require some sort of reporting.

--123.22 also talks about AES filing requirements for exemptions.  (I am not sure if you consider filing AES to be a report.)


Can goods classified as SME use the Canadian exemption?   Cat. XII(a)  I've received two different answers from DDTC and the regs are not clear here.  But NGC put out an article on Canadian exemption which stated if your good was classified as SME you could not use CAN exemption. I need some clarification of the ITAR regs.

There are four separate Canadian exemptions, each with their own set of rules.  In certain cases, certain SME is eligible because that is what the ITAR says.  Here is the situation for each of the four Canadian exemptions:

Here is what the ITAR says.

126.5(a) Temporary Imports:  The defense articles have to be unclassified.

126.5(b) Permanent and Temporary Exports:  The defense articles that may not be exported under this exemption are those listed in (b)(1) - (b)(21)--none of those paragraphs exclude all SME.  126.5(b)(11) excludes Category XII(c) in certain cases but does not exclude Category XII(a).  126.5(b) says that non-transfer and use assurances are required for all SME exported under 126.5(b), so it is telling you if you export XII(a) to make sure you have that (and that also implies that certain SME is eligible).

126.5(c) Defense Services:  This exemption says it uses the same item exclusion list as in the export exemption in 126.5(b)(1) - (21).  There are a lot of additional restrictions on the data and defense services that are eligible.

126.5(d) Retransfer in Canada:  This exemption refers back to items eligible for export to Canada under the export exemption so it uses the same item based restrictions as the underlying export exemption.


If a company does not bring goods into the USA under an ITAR exemption, in addition to filing a voluntary disclosure, I assume we would need an export license to export (return) the goods?

You would not do a normal voluntary disclosure in most cases. See http://www.pmddtc.state.gov/licensing/documents/WebNotice_TemporaryImportViolations.p


What requirements are needed to ship automation equipment from the USA to Europe (Poland Specifically)? What requirements need to be met?

Your question is too vague to answer. It is like saying, "My company makes automation equipment, how much tax do we have to pay?"

These things can cause there to be an export license requirement:

1) Is the item on a export control list?

2) Are any of the parties involved on a US denial list?

3) Will the item be used in a prohibited activity?

4) Are Cuba, Iran, Sudan, Syria or North Korea involved?

5) Is there anything suspicious about the transaction.


Seeking to export coated abrasives from the USA to Iran. Under the current administration, are there export controls or sanctions on this product?

Generally speaking all exports from the United States to Iran require a US export license and the government generally will deny applications for all items except, for example, for food and certain medical items. 

Also, the US imposes nearly the same rules on US origin products outside the United States being reexported from, for example, Canada, to Iran.  The US also imposes rules on non-US origin items that have US content or that were produced using US technology.

And, if you are a US person, you may not be involved in transactions with Iran or entities owned, controlled or acting on behalf of Iran.  For example, you may not approve or facilitate any transaction with Iran, even if the transaction is a shipment of German tables from Germany to Iran.


I am a UK citizen, living and working in the UK. I have recently started my own limited company, Coldharbour (registered in the UK), so that I can contract directly to a US Defense company as a Sales, Marketing and BD person for Europe and the Middle East. The company in question tells me that I must register with DDTC as a broker in order for them to raise the necessary export licenses (DSP-5 and, eventually, a TAA). My question is, do I really need to register?

Based on what you said, and lacking further details, it certainly sounds like you could be a "broker" under the International Traffic in Arms Regulations (ITAR).  If you are an ITAR "broker" you have to register and submit annual reports to the US Government.  In addition, certain "brokering activities" require prior US Government authorization or prior notification to the USG.  Check out ITAR Part 129 to see if you are an ITAR "broker" as the ITAR defines it.


Is it acceptable to use the 126.4(c) exemption when you are exporting ITAR controlled items to US Forces located in Afghanistan and Iraq?

The 126.4(c) exemptions says you may use it when you cannot get an approved export license in a timely manner.  Generally speaking, the State Department approves applications for US Forces in Iraq and Afghanistan in a couple of days so State generally thinks that you cannot use the exemption except in an extreme emergency.  See www.pmddtc.state.gov for guidance on how to apply for licenses for US Forces in Iraq and Afghanistan so you will get the expedited license processing.


If I understand export compliance and the ITAR, then if I use government standard and cleared top secret AES 128 encryption to send data to a database that is stored overseas so that I have top secret data at rest encryption, and I hold the encryption keys in the US. Am I still in ITAR compliance? According to Safe Harbor Provisions, lost encrypted data is not considered lost data. Therefore, data at rest encryption even on a server overseas is still in ITAR compliance. Is this correct?

The ITAR does not have words that support your position.

The ITAR definition of export in 120.17 says that "sending a defense article out of the US" is an "export."  ITAR controlled technical data is a defense article.  Nothing in the ITAR says that if you encrypt ITAR tech data it is no longer ITAR tech data, just like if you lock up a bomb in a box that is impossible to open, the bomb does not cease to be a defense article.  Nothing in the ITAR says that the definition of export does not apply to encrypted tech data.

Regarding your reference to Safe Harbor. etc., you are using non-ITAR rules and principles to determine the scope of ITAR jurisdiction, which is not recommended.

Now, I will say that the fact that ITAR tech data is encrypted is a factor that may mitigate against serious penalties in the case where your company violates the ITAR by inadvertently exporting encrypted technical data. 

But, I would not call Customs and State and tell them "Hey, I am about to export ITAR tech data that has been powerfully encrypted to a database overseas and you cannot stop me because it is not an "export" as defined in the ITAR."

What you might consider doing is sending a General Correspondence letter to State and ask State to give you a binding ruling on your question.  I hope you are successful.  Even more than that, I hope you will share the results with us.


If I am sending ITAR controlled material to a domestic location in the U.S. am I obligated to ask them who their end customer is? Are they obligated to tell me?

The ITAR does not require that you ask and it does not require that they tell you.

It is a good practice to either ask for that information or get the other party to agree in writing that they will comply with the ITAR as it related to the defense articles you send to them.  It is a good policy to always advise other US companies when you send them ITAR controlled "defense articles."  Another US company may have commercial or competitive reasons for not wanting to tell you who their customer is so telling them your items are defense articles and getting them to agree to comply is reasonable and is doing more that the ITAR requires.

If you suspect they are going to do something illegal, you should not proceed.


I work for a company that manufacturers product under 9A991. We have recently been bought by a foreign firm. What should be my next move in regards to TCP? We did not have a policy in place due to the fact that we had not employed a foreign person.

You did not tell us the ECCN for your technical data/technology so we have to answer this in a bit of an open ended fashion:

1) Determine the ECCN for all of your technical data/technology.  (I assume you do not have anything controlled by the ITAR.)

2) Determine if any of the ECCNS for your technical data/technology require an export license for:

    --The country in which the foreign firm that bought you is located, or

    --The nationality of any of the employees of the foreign firm.

3) If there are no instances of a license being required, then just train your foreign owner about issues related to reexporting your tech data/technology and issues related to release of to foreign nationals for which a license would be required.

4) If you find any instances where your tech data/technology requires a license for the country or the nationalities of any of the employees, put in place procedures in you US and foreign locations so that the foreign company/foreign nationals do not have access to license-required data.  This includes preventing access to data electronically via a server, email etc.  It also includes preventing access to tangible data on paper.  It also includes intangible access to data via oral disclosure in conversations or visual disclosure of data  during visits to your facility.   You should also do the things described in 3.


What is the State Department's (DDTC) rule/position regarding foreign national "domain administrators" (with system alerts in place to identify if they try to access or change security for ITAR secured files/employee access)?

I have not heard of a State Department official position--i.e., an official written interpretation of the ITAR signed by the DDTC Director.

According to the ITAR, an export occurs if you disclose or transfer technical data to a foreign person in the United States or abroad.  So, technically speaking, the fact that a foreign person could get ITAR tech data does not mean a violation has occurred--the violation occurs when your company actually transfers or discloses the tech data to the foreign person. 

It is also an export to send a defense article (which includes tech data) out of the US--it does not matter if a foreign person sees the data for that export to occur.

As a practical matter, it makes sense to put in place security measures so ITAR tech data does not leave the United States without approval and so that foreign persons do not get access to ITAR tech data without approval.  I would not want to have to defend my company if foreign persons or persons outside the United States can have access to tech data even if there is no proof that an actual export has occurred.  I prefer to have procedures in place that err on the cautious side on this point.


Our US owned small business utilizes sales representatives. We have identified a sales representative (defined as "broker" for the purpose of ITAR regulations) in India that we would like to utilize to sell our products (commercial and military applications). The "broker" is not a US person or located in a US jurisdiction. Are they required to register with DDTC as a broker?

DDTC wants that party in India to register if they are a "broker" of "defense articles" subject to ITAR jurisdiction.


My company is ITAR certified. We are doing ITAR work for another ITAR certified company. We need to send the material to another US company to complete one or more steps in the process. Is the third party company required to be ITAR certified?

I am not sure what you mean by "ITAR certified."  If you mean you sent your registration form and money into the State Department and State gave you your registration code, then your company is "registered."  Registration does not certify anything--it just means you filled out the registration form correctly and paid the correct amount of money as required by the ITAR. Similarly, when you send in your form and money to pay your federal taxes, you are not IRS certified.

 The ITAR requires that any company in the United States who exports OR manufactures "defense articles" has to register with State.  If a company is an ITAR “broker," it has to register as a broker, separately and in addition to the ITAR exporter or manufacturer registration.


I attended a seminar in Montreal last year and today my activities will include repairing items (EAR classified) which are in Brazil. I will send the materials from Brazil to the repair facility in the USA and I would like to learn more about the export license to return the repaired materials to Brazil. Is there any manual or website which explains this repair process for EAR items?

The first step is to determine the ECCN.  If the ECCN is eligible for NLR for Brazil, you may use NLR to send the items from the US to Brazil.  If the items are not eligible for NLR, then License Exception RPL would authorize the return of the items to Brazil in most cases.  Check EAR 740.10(b) for the details of RPL.


Is there a restriction on selling internet based radio devices to Indian customers? The frequency of operation will be in the UHF band. We have a customer who needs our radios and we intend to verify if we can ship the product to them. They are a robotics company and will use the radios to control their robots.

A US export license would be required if any of these issues are present:

  • The items are in ECCNs that require a license for the country or the items are on the US Munitions List
  • Any of the parties in the transaction are on a US prohibited parties list
  • The items are intended directly or indirectly for a prohibited nuclear, missile, or chemical/biological weapon related end use
  • Cuba, Iran, Sudan, Syria or North Korea are involved directly or indirectly
  • There is something suspicious about the transaction that indicates that the above might be true

Is it permissible to ship ITAR controlled and EAR controlled items in the same shipment? What are the advantages/disadvantages of "mixed" or "commingled" shipments?

It is possible to do it but it will complicate your export paperwork significantly.  If possible, I would avoid doing it.


What is the export code (ECCN) for rubber grommets? Can these be classified as EAR99?

Often, but not always, they are EAR99.   For example, if they are specially designed for something, they could have a different ECCN or be on the US Munitions List.


We have a customer who wants us to show we are ITAR registered and compliant and we have the registration code from the U.S. Department of State.  Is that code proprietary?  Can we forward that statement to the customer as proof?

State's guidance is that the code is proprietary to the registrant (http://www.pmddtc.state.gov/registration/registration_code.html), but it is really your call as to whether you want to share it or not. Someone with your code could use it to look up the status of certain pending cases you might have with State.

As an alternative to providing the code you could give the customer a copy of your most recent registration renewal letter from State with the code redacted. I think that would satisfy the vast majority of people.

Also, remember that being registered does not in and of itself demonstrate full compliance with the ITAR.


Do the same dual and third national restrictions apply to ITAR Controlled Data and Hardware if it is received under a DSP-5 or DSP-73 as opposed to a TAA?

The same principals apply to access to tech data exported under a DSP-5 or TAA.  Single country nationals who have only the same nationality as the country of the authorized recipient entity may have access to the tech data unless the approval authorizes other nationalities.
 


Other navigation direction finding equipment, airborne communication equipment is classified under the ECCN 7A994 on CCL along with the QRS11–00100–100/101. Does this mean that if the QRS is integrated into, and included as an integral part of a commercial primary or standby instrument system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 it requires a license? It's impossible to find out if every single item classified under the ECCN 7A994 has or hasn't't had a QRS sensor incorporated?

When the QRS-11 is in an item made outside of the United States and it meets these criteria in 734.4()(3)(1) - (iii), the non-US origin item takes on a US classification control level of 7A994 or 9A991. In other cases, the QRS-11 or a non-US item that incorporates a QRS-11 is controlled by the ITAR.

Here are the regs:

734.4(a)(3) There is no de minimis level for foreign made:
(i) Commercial primary or standby instrument systems of the type described in ECCN 7A994 on the  Commerce Control List (Supplement No. 1 to part 774 the
EAR) when the systems integrate QRS11- 00100-100/101 Micromachined Angular Rate Sensors;
(ii) Commercial automatic flight control systems when the systems integrate QRS11- 00050-443/569 Micromachined Angular Rate Sensors; and
(iii) Aircraft of the type described in ECCN 9A991 when such aircraft incorporate a primary or standby instrument system integrating a QRS11-00100-100/101 sensor or an automatic flight control system integrating a QRS11-00050443/569 sensor.

Note to Paragraph (a)(3): QRS11 Micromachined Angular Rate Sensors are subject to the export licensing jurisdiction of the U.S. Department of State, Directorate of
Defense Trade Controls, except when the QRS11-00100-100/101 version of the sensor is integrated into and included as an integral part of a commercial primary or
standby instrument system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates a commercial primary or standby instrument that has such a sensor integrated, or is exported solely for integration into such systems; or when the QRS11-00050-443/569 is integrated into a commercial automatic flight control system of the type described in ECCN 7A994, or aircraft of the type described in ECCN 9A991 that incorporates an automatic flight control system that has such a sensor integrated, or is exported solely for integration into such a system.


How should equipment in the UK which contains an ITAR component that needs to be tested at a site that was once 100% Government owned but is now a Government Owned/Commercially Operated (GOCCO) site be treated? Is the GOCCO treated the same as the original government body or does a license now need to be amended to include the GOCCO?

If it is a UK Government facility, take a look at 123.9(e).  That applies if the retransfer is to the UK Government (or to NATO or other eligible governments).  I do not know enough of the facts of your situation to know if you can use 123.9(e). 

If not 123.9(e), then we need to know how the component got to its present location.  If it got there under a DSP-5, you could do a General Correspondence (GC) request for retransfer authorization.


Domestic shipping of ITAR controlled material from one US company to another, both of which are ITAR registered, is it required that the shipper company notify the receiver company that the material is ITAR controlled?

Nothing in the ITAR says you have to notify the US recipient of ITAR items.  Doing so, however, is a prudent practice to help the recipient recognize when it receives ITAR items.  Importantly, failure to do so is not an ITAR violation.


I have a DSP-5 (2009) with Canada only for marketing and TD. Technical discussions are planned and it has come up that and there may be a few dual nationals (Canada/Poland for example). How would the export to Poland be authorized under the current DSP-5? Would I need to submit a new request under the new rules (DN)?

Your license, unless it specifies otherwise, authorizes the defense articles to go to the Canadian company and its Canadian nationals. 

The Canadian company may allow its dual nationals to have access to the defense articles under the new 126.18 exemption.  If the Canadian company does not have the required compliance procedures in place to use the 126.18 exemption, then you may apply for a new DSP-5 authorizing the nationalities in question.


We are a US company and want to import a fuel cell and a DC converter into the US for an ITAR project. Is this allowed? What paperwork (e.g. export license, ITAR documents) are required?

You need DDTC authorization for temporary imports of "defense articles" as defined by the ITAR.

You need DDTC authorization if you are going to export ITAR controlled technical data in any activities, including exporting ITAR tech data as part of the procurement process.

If you will be exporting tech data controlled by the Export Administration Regulations (EAR), then you need to comply with the EAR.


We are a foreign company employing both TCN's and US personnel providing defense services to a foreign government. We are a signatory on TAA's that authorize us to provide defense services. However, someone said that the TAA does not cover US personnel since they are employed by a foreign company and that each US person employed by our foreign company needs to have individual licenses whether by registering with the State or being employed by a US company. Do TAA's give approval for US citizens employed by a foreign company or is individual authorization required?

1) If you are talking about US persons you employ:

Arguably, no authorization is required for retransfers to US persons or to the United States (other than temporary imports into the United States), but the ITAR is not crystal clear on this.

If you want to take a conservative approach, the US party could add the United States as an authorized nationality to whom you may retransfer ITAR tech data in the same fashion as it could add Saudi Arabia or France. Alternatively, you could use the new foreign person exemption that entered into force in August 2011 if the TAA holders amend its TAA to authorize that. If the US TAA holder does not want to amend its TAA, you may submit a General Correspondence (GC) request to do so, but I suspect DDTC would rather see this done through the TAA.

2) If you are talking about US persons employed by another company:

Arguably, no authorization is required as stated above. 

If the other company is named as an authorized recipient (signatory or sub-licensee) on the TAA, then the same principals described in 1) above are true.  If the other company is not named as an authorized recipient on the TAA, the US TAA holder could add that company to the TAA and take the appropriate steps regarding the dual and third country nationals (including US).  If the US party does not want to do that, you could submit a GC and address all nationalities required, but again I suspect DDTC would prefer to see it done through the TAA.


If my company has the opportunity to sell a confirmed USML Category VIII.h for civil FAA certified applications, will the Civil FAA exception (standard part, integral part & FAA certified platform) to VIII of the ITAR allow the jurisdiction of the article to become be reversed and confirmed dual-use?

Yes.  When all three of those criteria are met, it is no longer on the USML.  If, for example, you want to export it before it qualifies for the FAA cert, it is still on the USML.


We are a UK aerospace company making parts for delivery to another UK company (BAE). If we manufacture an ITAR restricted part and ship it to the UK customer (BAE) do we still need the ITAR license? Or is it the customers, (BAE), responsibility dependent on where they ship it to?



Scenario:

The assumption for this scenario is, this transaction will occur between US companies involving only US persons (non-export). A manufacturer receives an unclassified (not secret but military) ITAR marked Assembly level drawing (parent) from a customer. In order to build a single component/part which is called out on the original Assembly drawing (parent), the manufacture creates a new Component level drawing (child). The manufacturer uses its name on the drawing, different part #'s, and ensures there is no link back to the original (parent) Assembly level drawing.

First Question: Does this new Component level drawing (child) need to be marked as ITAR controlled?

Second Question: If the answer to the first question is Yes, then what is the obligation of the manufacturer when acquiring raw material for this component/part from its suppliers/vendors?

Third Question: What is the obligation of the manufacturer if they decide to sub contract out to another manufacturer to have the component/part made?

Fourth Question: How does this scenario affect EAR 99 with NLR.

First Answer: If the parent item is a defense article, it is likely that the child item is specially designed for an ITAR item which means the child is a defense article.  That means the child drawing is ITAR controlled.  The ITAR does not require that you mark drawings as ITAR controlled unless you export them.  It is a prudent business practice to do so even though it is not required.

Second Answer: The ITAR does not require that you notify other US parties that you are acquiring raw materials to make an ITAR item.   I would assume much of the raw materials are not ITAR, but I cannot tell here.  If you give suppliers ITAR tech data (e.g., drawing), it would be a prudent business practice to let them know you are giving them ITAR tech data.  If you export ITAR tech data, you must tell the recipient the tech data is ITAR controlled by marking the tech data or cover letter.

Third Answer: Assuming you are doing this in the US, the ITAR does not require that you notify the other US manufacturer.  It would be a prudent business practice to notify them.

Fourth Answer: I don't know what you are asking


Can you clarify when a manufacturer would also need to register as a broker? Specifically, do I need to register to sell the products I manufacture or only if I sell the products that someone else manufacture?

You need to register if you provide assistance to another person to help them sell defense articles.

If you just sell defense articles for yourself, regardless of who makes the defense articles that probably does not create a requirement to register as a broker.


We are registered with the DDTC and will be purchasing defense articles (ITAR controlled) of non-US origin from a company in the UK. Upon arrival at our facility in the US we will ship the goods to Denmark. Aside from following UK regulations will we need an export license from the DDTC in order to ship these parts to Denmark? If so, why type of license is required?

The type of license required (for example, permanent export, temporary export) is required in this case as would be required if you were exporting US origin defense article.


My company has two locations in the US. When we first wanted to get into ITAR work we registered as required. Do both sites need to register? We actually do most of the ITAR work at one of our sites while not so much at the other.

Typically the corporation registers as a corporation and identifies all of the sites in the registration.  If you only identified one site, you should immediately update your registration with that information.


My company is ITAR registered. If we need to send ITAR material to another company in the US to complete one or more steps in the process is the other company required to be ITAR registered?

The ITAR requires that any company who manufactures defense articles register with DDTC.  If those other companies are doing part of the manufacturing process, the ITAR requires that they register.


I'm visiting Los Angeles shortly and am thinking of getting a Leopold range finder. Will I be ok to take it out of the country? I don't want to be stopped for something illegal on the way out!

It depends on the rangefinder. I suggest you contact the manufacturer before you buy the item and ask the manufacturer to tell you what export controls apply to the rangefinder you want.


If an American citizen, temporarily working in France, is exposed to French military technology (blueprint or specification), will it create the need to have the ITAR applied to the technology/item?

No.  The act of a US person seeing non-US origin technical data does not cause the non-US technical data to become subject to ITAR jurisdiction.


We are a manufacturer and get repeat orders under the same P.O. # but these repeat orders may be placed over several months. Under the EAR, do we have to screen the customer and contact person(s) each time a repeat order is placed? Do we even need to screen the contact person at all who works for these companies that we do screen? Do the rules change under the EAR if these were new orders with a different P.O. each time? Do I need to screen the customer each time? Do I need to screen the contact person each time? Can you point me to the EAR regulation that states the requirements for my situation?

By "screening," I assume you mean screening against the various US prohibited parties lists.

The EAR does not require that you screen against the prohibited parties lists.  The EAR, and depending on the list, other regulations, merely prohibits you from being involved in activities with parties on the lists.  It is similar to speed limit laws on the highway--the laws say you may not exceed the speed but the law does not tell you that you have to check your speedometer and it does not tell how often to check your speedometer.

So, it comes down to your decision as what prudent screening procedure you want to implement based on the way you do business and your assessment of your risks and your risk tolerance.  Some concepts to consider:

--Screen all known parties--suppliers, customers, forwarders, banks, etc.

--Choose between:

1) Transaction screening (e.g., Screen immediately prior to purchase, signing contract, export, etc.) or

2) Batch screening (e.g., screen all parties you deal with today and designate them as clean--you do not have to screen individual transactions if all parties involved are in your clean list.  You need to screen all new parties before you add them to the clean list and then every time the US Government makes a change to one of the lists, screen that change against your clean list).

There are unlimited variations on transaction or batch screening and combinations of them too.  The bottom line is the rules say you may not participate in a transaction with someone on a list.  The rules do not tell you how to screen. 

And, for the record, the restrictions on the parties on the list many vary depending on which list a party is on or what specific restrictions the US Government has placed on the party.  It is not actually as simple as saying the rules say you may never be involved in a transaction with a party on the lists.  Some companies implement a company policy of never dealing with someone on one or any of the lists.


Can you tell me what a company should be doing about dual nationals who will be working on programs that involve ITAR technical data?

It depends on the nationalities of the dual nationals. If a dual national has US citizenship, permanent resident status, or protected status, that dual national is a US person. If a dual national does not have US citizenship, permanent resident status, or protected status, that person is a foreign person.  Get a foreign national DSP-5 license for each individual who is considered a foreign person.  The DDTC website has guidance on that.


If a part/product is classified as a “commercial item” does that have any bearing on whether or not it will be cover under the ITAR?  Can a “commercial” or “COTS” item still be classified under the USML and subject to ITAR requirements?

Not really.  Commercial and COTS items can be on the USML and controlled by the ITAR.  If it is on the USML, it makes no difference if it is COTS, commercial, off the shelf, etc.


If a standard catalog industrial product (not subject to the ITAR) is modified for a foreign military vehicle, then that would still then be subject to the ITAR (USML VII)? If the product is purchased by and modified by an independent distributor to the foreign country is there a potential classification issue?

If the foreign military vehicle is described in Category VII, then industrial product modified for that vehicle is likely in Category VII.  You determine jurisdiction based on what you are exporting because your issue is the export from the United States. So, if you export an item that is not on the USML with knowledge that it will be modified overseas for a military vehicle, you do not have ITAR issues, unless you help the foreign party do the modification.


What is the most effective away of browsing the Federal Register to receive results pertaining only to export compliance issues for specific business/individuals?

I find it to be easier to go to the key US Government websites to look for Federal Register notices.  As a starter I suggest, www.bis.doc.gov, www.pmddtc.state.gov, and http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/OFAC-Recent-Actions.aspx.


Is it possible for us as a Norw company or our customer, the Norw Defense, to apply for an ‘open’ ITAR license for specific equipment, for instance a license covering several years or several purchase orders for the same type of equipment?

Generally speaking, the State Department (DDTC) does not issue the type of open licenses that we see some European governments issue.

Normally, the applicant for an ITAR DSP-5 export license must be in the United States.  Parties outside of the United States usually may apply for "General Correspondence" licenses for reexports and retransfers. 

Over the years, some foreign (i.e., non-US) governments have used large export licenses that said something like "1 Lot of Various Spare and Replacement Parts to the Support the F-XX Fighter for a [large dollar amount]."   In some cases the foreign government will appoint a US freight forwarder or other US party to be the applicant or exporter. 

DDTC's willingness to issue such licenses changes to some extent over time.  I have heard that such licenses somewhat fell out favor for a while. 

You don't know what they think today about the concept of issuing large bulk licenses like this unless you ask DDTC today.  Their answer may well depend on the government involved (Norway is fairly favorable), the parties involved, and the items involved.

So, I suggest that the Government of Norway approach DDTC on this since they may get a more favorable response than a company.  The second best option would be for you or somebody from a company to ask DDTC the question.


My company is a global provider of Video Conference Systems. My question pertains to commercial invoicing. If we take many different items to make a "Small Conference Room", can we make a part number for the one item, the "Small Conference Room"? Or is it best to itemize out all of the gear individually. I would think the latter because what ECCN/HTS would we use for the "Small Conference Room", if we were able to do it that way?

There can be a distinction between what is required and what might be good business practice.

US export regulations do not tell you exactly how to describe the item on your commercial invoice or how to determine how to apply your part numbers.  Various business reasons will shape how you want to describe the items and for convenience reasons you may want to make your invoice (and other) descriptions be something that is easy for import and export government officials to understand so they can readily assess their compliance concerns.  It is not a violation of US export regulations to have an unclear or vague description on your invoice but it is not a good idea.

There could be a whole host of issues related to how you determine the ECCN and HTS for what you are exporting--too many potential issues to address in detail without knowing a lot more about the item/items in question.


UK Origin goods exported to the US with the intention to re-export to another country. How do I go about getting accurate export information for the parts? The UK manufacturer keeps telling me that the US controls do not apply to the goods. And, it is very difficult for me to self-classify the items.

US export controls apply to all items when they are in the United States, regardless of the origin of the items. 

Your question is a business question, not a regulatory question:  How do you force another company to give you information?   The US regulations do not require that the UK company give you such information.  So it comes down to what you can negotiate with the UK company.  For the future, you could include in your contract or PO a requirement that they give you this information.  

You also have to consider the issue of whether the UK company would be able to accurately classify the item under US regulations.  If you are the US exporter, you are responsible for the export.  If the UK company incorrectly tells the item is EAR99 and you export it as NLR, that is your violation.  So, maybe you would be better off classifying the item yourself based on technical information the UK company gives you.


I am a British national and hold full UK British citizenship from birth. I would like to apply for an OCI (Overseas Citizenship of India) card to make traveling to India easier. I believe the OCI is NOT classed as dual citizenship and hence on ITAR registers I should be still considered as British/UK citizen. Hence...is, my ITAR status affected by applying for an OCI?

Good question.  The ITAR does not define citizenship, nationality, dual-national status, etc.  DDTC has said it will consider all relevant factors. 

I do not know the answer to your question.  Obviously, the safe approach would be to say that if you got that partial or semi-Indian citizenship then you would be a dual UK-Indian national for ITAR purposes.  If you want to know for sure, send a General Correspondence letter to DDTC and ask the question.


We have received a DSP-83 for an order (ITAR controlled items) to be shipped overseas and will need to apply for a license. Do we still need an End-user letter even though on Section 7 of the DSP-83 form, it basically states what an End user letter would say, plus it has the official seal of the end-user? Would it be acceptable if we just have the DSP-63, and a PO from the company buying from us, since we will ship directly to end-user?

You need something in writing, preferably signed, that states the end user, end use, quantity, value, and country--that is sometimes called a verification of purchase.  It can be in a PO, letter of intent or other document.


We are a company registered with the DDTC. If we are modifying a product to go inside an ITAR controlled item, are we required to confirm if our customer is registered with the DDTC?

The ITAR does not require that you do that.  DDTC, of course, would like you to do it but DDTC so far has not revised the ITAR to make it a requirement.


If I am selling a UK designed & owned product to a US customer/US government is it ok to put the ITAR statement on all of the copies of the drawings that I send to my customer even though they will remain UK property?

Purely UK origin "defense articles" (including data) are subject to ITAR jurisdiction while it is in the US.

The ITAR does not require that you put ITAR markings on items (regardless of whether they are US or non-US origin) that move from one US party to another US party. 

You may put the ITAR markings on the UK data if you wish.  It is a prudent practice to do so even if it is not required.


This question is regarding permanently importing purchased overseas surplus US military ITAR Cat VIII articles from the US government. ITAR 120.5 refers to ATF CFR 127 Part 447. However, Part 447.21, The U.S. Munitions Import List specifies that Category VIII (b) through (j) of the Munitions List is deleted as inapplicable to imports. CFR 127 Part 447.53 Exemptions doesn't't seem usable because it refers to "articles on the U.S. Munitions Import List" and Category VIII (b) through (j) having been deleted are not on the US Munitions Import List. What would be the correct process to permanently import purchased US USML goods that have been deleted from the US Munitions Import list?

The ITAR does not prohibit permanent imports so it does not require licenses or authorizations for permanent imports. 

As a practical matter, you should just keep the records you have, or will have, related to the permanent import such as the Customs import documents, shipping documents, documents related to the commercial transaction, and the surplus purchase docs.


A manufacturer got the export license from State of Department and we are a foreign consignee in the license. They shipped out a part of the items described in the license to the end user in overseas. Now they just denied shipping the remained items since they don't want to continue business with us because of its internal matter. My question is: Isn't it the manufacturer's violation of ITAR if he does not complete the shipment of all the remained items according to the export license? Would you please show me the concerned article in ITAR if so?

It is not an ITAR violation to decide to not export the things on your US export license.


We are a Foreign company issuing RFP's to US companies whose products are export controlled (both ITAR and EAR). We will be requesting a technical section with detailed technical data be provided within the response and understand a license will be required. We have received various responses from the US companies i.e. 1) DSP-5 in response to RFP but must have official RFP; 2)"Marketing" Tech Data DSP-5 with no need for RFP; 3)cannot provide data without TAA in place. Understanding that providing tech data is really considered a defense service, the TAA would seem to be the best route however... What is the difference between a license providing tech data in response to a RFP vs. a "Marketing" tech data license. What type of info can be provided under each? Also, since we will be presenting this data in a proposal we are preparing for submittal to a different foreign company, shouldn't't the US companies have the names of all parties that will have access to the data? Would we be the end user and our proposal be considered a re-export of the data?

A license normally authorizes the export of discrete technical data and documents.  An agreement gives more flexibility for technical interchange, discussion and true defense services. 

A DSP-5 to send you technical data authorizes whatever the company requests minus whatever DDTC removes via proviso.  A DSP-5 for marketing license normally authorizes fairly non-sensitive data for marketing purposes to multiple recipients. Normally, in the situation you described a company would not do a marketing license but would do a DSP-5 for what could be much more detailed tech data and technical data more specific to your one situation than you would usually see in a marketing license.  The company that said it needs a TAA is asking for the most flexible approval option--the TAA will authorize whatever tech data and defense services the applicant requests minus anything DDTC excludes by proviso. 

Generally, marketing DSP-5 has narrowest scope of eligible data, DSP-5 has a wider scope, and TAA has the widest possible scope of tech data plus real defense services.

I cannot guess why a specific company may have chosen one approach over another approach.  If the decision is an informed decision, they a company may be going with an approach that has served it best in the past.

I recommend you give the US companies a description of what you plan to do with the technical data (i.e., pass it on to other companies and other nationalities) so they can address that in their license application.  Yes, the US companies should be asking for that, but it is in your interest that you give them the information and ask them to get an export approval that authorizes what you need.


My customer in the UK is requesting copies of all licenses pertaining to them. Can I send a copy of an approved DSP5 overseas?

Usually you may send them a copy. 

The ITAR does not regulate the export of approved licenses unless:

--The approved license includes technical data.  Most approved licenses include a description of technical data but not technical data.

--In some cases the license will have a classified proviso that you may not share.

--In some cases a proviso will explicitly state that you may not share that proviso with a foreign party.