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I have received an ITAR controlled hardware from a US supplier on a DSP-5. Am I allowed to return this ITAR controlled hardware to the US supplier or do I have to ask DDTC for a re-transfer? The DSP-5 says nothing related to this.

Hardware shipments from outside the US to the US are imports from a US point of view. The US importer must have ITAR approval for a temporary import. This approval could be a license (i.e. DSP-61) or there may be an exemption which permits the temporary import without a license (e.g. §123.4(a)(1) for servicing of US-origin defense articles). If the shipment is not temporary, but rather is a permanent import into the US, the US importer may need Bureau of Alcohol, Tobacco, Firearms and Explosives approval if the item is described on the US Munitions Import List.

Whether temporary or permanent, the US importer is responsible for compliance. However, it is would be wise for the non-US shipper to contact the US party prior to shipment to coordinate the details with them.

We would like to employ a foreign national from India. He has been working in the US for 10 years with an H-1B visa. Our company manufactures parts for the Department of Defense. How can we employ this individual and remain ITAR compliant?

The release of ITAR-controlled technical data to a foreign person is an export. You have essentially two options: (1) seek a State Department license authorizing the export or (2) establish strong procedures to ensure that no ITAR-controlled technical data is released to your foreign person employee. Also keep in mind that many military-related technologies are now subject to the EAR, and may also require authorization for release to foreign persons under those regulations.

I know ECCN is the Export Control Classification Number, does it apply to EAR? And does it also apply to ITAR?

ECCN is an EAR concept. Defense articles and defense services subject to the ITAR do not have ECCNs.

Would you please give me an example of ITAR classification number?

US Munitions List Category XIII(b)

If I have a product that utilizes a component that includes a cryptographic security module (but we will not be utilizing the encryption function) can I ship the product as per usual or are there some special classification and/or license involved?

You need to compare the details of the item to Category 5 part 2 to see how those controls apply to the item.

We shipped an ITAR commodity to Turkey under a USML-State Department license. The customer now wants to return the commodity for a refund. It is ok with us but we have the following questions:  1) Is there anything we need to do at our end?  2) We saw that ATF is involved with “import” of US -USML goods? Is that true?

The ITAR does not regulate or control permanent imports into the United States as you described.  BATFE has a US Munitions Import List and regulates permanent imports of the things on that list.  In fact, if your item is on the USMIL, it likely requires a BATFE export and import permit. The USMIL is similar to the USML but controls significantly fewer items.

When do Schedule B numbers need to be included on invoices and other order/shipping documentation? Is there a difference between regulation requirements and best practices in the aerospace industry concerning listing Schedule B numbers?

The Schedule B number must be included in the Electronic Export Information submitted via AES in many cases, but US export rules do not require that you put it on other documents. Putting the Schedule B number on the invoice certainly is a good practice if you determine that doing so is a wise use of your limited export compliance resources.

I work for a non-US company (Canada) that is looking to export finished goods that are not an ITAR classed item, but has one component that is classified as ITAR from a US based manufacturer. Would there still need to be an export permit required since the ITAR item has changed its identity?

The ITAR usually retains control and licensing requirements over such items.  In many cases the original US export license would authorize what you want to do but you should check with the US exporter to find out what its license authorizes.