Suppose your organization is involved in exporting certain goods, software, or technology, which may be useful in any number of applications, to specified countries. In that case, you may face special licensing requirements. Your organization will likely have to develop compliance strategies around the Military End-User (MEU) Rule, which is part of the Export Administration Regulations (EAR).

Your organization’s compliance with the MEU Rule is critical, as the fallout could involve hefty civil and criminal penalties and export-related complications. Here is what the MEU Rule entails and what stakeholders can do to ensure compliance.

What the MEU Rule Entails

The MEU Rule at §744.21, which the Department of Commerce’s Bureau of Industry and Security (BIS) enforces, is an additional EAR license requirement that may apply in addition to standard destination-based export controls. It requires parties to obtain an export license if a party knows, or has reason to know, that the items they are exporting, reexporting, or transferring in-country are intended for a military end user or a military end-use. Exporters, reexporters, and in-country transferors generally must obtain a BIS license for such an end use or end user if both of the following conditions apply:

  • The item the organization is exporting falls under any of the Export Control Classification Numbers (ECCNs) described in Supplement No. 2 to Part 744 of EAR. Widely exported items on this list include mass market encryption software, aircraft and ship parts, and common electronics.
  • The destination for the item is Burma, Cambodia, China (including Hong Kong), Russia, or Venezuela

Exporters unsure of how to best classify their products and other exports can request classifications through the Simplified Network Application Process – Redesign (SNAP-R) portal or self-classify their items. Although BIS offers a guide that helps companies classify their products using the ECCN system, ECTI also offers comprehensive course bundles that can walk you through this process.

Understanding Military End Use

Given the consequences at play, it would be natural to wonder what types of end uses would fall under the rule’s purview. The MEU Rule codifies this guidance, including the circumstances which BIS regards as a “military end use.” Under §744.21(f), BIS will consider an export to have a “military end use” if either of the following situations apply:

  1. The item is for incorporation into military items described:
    • On the U.S. Munitions List (USML), or
    • In an ECCN ending in “A018” or a 600 series ECCN. Such items include, but are not limited to, articles and components used in explosives, imaging sensor devices, military vehicles, aircraft, and gas turbine engines
  2. Any item that supports or contributes to the operation, installation, maintenance, repair, overhaul, refurbishing, development, or production of military items described on the USML or an ECCN ending in “A018” or a 600 series ECCN

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End Users Covered by the MEU Rule

Beyond this, exporters will also need to consider whether their transactions will involve “military end users.” Section 744.21(g) of the MEU Rule states that these end users can include any of the following:

  • National armed services, including armies, navies, marines, air forces, and coast guards
  • National guards and national police
  • Government intelligence or reconnaissance organizations
  • Persons or entities whose actions or functions are intended to support “military end uses” as described in the rule

BIS has explicitly named certain entities as military end users in the agency’s MEU List, as found in Supplement No. 7 to Part 744 of EAR and periodically updated in the Federal Register. Although BIS’s MEU List identifies military end users, this list is non-exhaustive. Therefore, exporters must continue parsing these definitions and assessing what they know or should suspect about their transactions when determining whether they are dealing with military end users.

How Companies Can Mitigate Their Risks for Non-Compliance

Non-compliance with the MEU Rule—and, by extension, EAR—can be prohibitive for organizations. These penalties, outlined in the Export Control Reform Act of 2018, can be civil and criminal. The maximum limits for these penalties include:

  • Criminal penalties of up to 20 years of imprisonment, up to $1 million in fines per violation, or both
  • Administrative monetary penalties of either up to $308,901 per violation as adjusted for inflation or twice the value of the transaction, whichever is greater
  • Denial of export privileges for any transaction governed under EAR

To ensure compliance with the MEU and to avoid both statutory penalties and attendant non-compliance complications, your organization must master EAR’s various ECCN classifications. More importantly, companies should not misclassify items to avoid having otherwise exempt items be subject to the MEU’s purview. Proper and extensive training on best classification practices can significantly help stakeholders on this front.

From there, after you confirm whether you will export items to China or one of the other countries the MEU Rule targets, you will need to evaluate whether you will be transacting with “military end users” or for a “military end use”. You can confirm this by researching your transaction partners’ lines of business online or working in tandem with your organization’s overseas affiliates to do the same offline. Third party information services may also prove helpful. In doing so, consider obtaining an end-use statement or end-use certificate from your transactional partners. While not mandatory, doing so can put your transactional partners on the record about their involvement (or lack thereof) with military-related activities and help establish the extent of your knowledge about their military-related activities.

Finally, your company should consider simply filing a license application that includes all the information you and your colleagues know about your items and the anticipated end use and end user. By doing this, you will shift the burden to BIS for assessing whether it is truly necessary for your company to obtain an export license.  If BIS ultimately decides that your organization does not need a license, then its decision is sufficient for allowing you to move forward with the export at issue.

We hope this article helps you understand what you need to know about military end-use export rules and the MEU Rule, along with when they could apply to your company. As we said earlier, export compliance is a complex and detailed undertaking. Your company’s investments rely on achieving 100% compliance with all applicable export regulations and controls. That said, it is absolutely achievable—you can do it, provided you take the necessary time up front to align with an established and widely acclaimed export compliance training partner who can guide you step by step toward compliance success.

Contact the Export Compliance Training Institute

Do you have questions about military end-use export control rules or other export compliance challenges for your company? Visit to learn about our company, our faculty, our staff and our esteemed Export Compliance Professional (ECoP®) certification program. To find upcoming e-seminarslive seminars and live webinars, and to browse our catalog of 80-plus on-demand webinarsvisit our ECTI Academy. You also can call the Export Compliance Training Institute at 540-433-3977 for more information.

Scott Gearity is President of ECTI, Inc.