Check It Twice: Are Your Exports Legal?

International exports are closely monitored, regulated, and restricted by the Government. Regardless of how innocuous you think your item is, you need to know what can happen to them and you once you attempt to send them across borders.

Several different entities regulate exportation of sensitive equipment, software, and technology, including the Export Administration Regulations (EAR), Commerce Control List (CCL), Arms Export Control Act (AECA), and International Trafficking in Arms Regulations (ITAR). Violations of laws pertaining to these jurisdictions can exact hefty financial penalties and substantial federal prison sentences, so it’s key to know exactly what’s legal and illegal to export.

If you are concerned about your legal standing, please be aware you can decrease your risk of inadvertently exporting an illegal item right now by learning about these laws. If you don’t fully understand export laws, you may inadvertently break them. For example, you may think you can send an otherwise harmless laser overseas. In reality, this laser may be used as a part for weaponry, depending on its final destination. The first step in preventing illegal activities is to become familiar with the following laws.

Items subject to Export Administration (EAR) include military or commercial items considered “dual-use,” or those with commercial and military applications. You can see why situations may get sticky if someone thinks they’re exporting a commercial item without knowing its potential for dual use. But don’t worry, there is a way to check if your exports fall under this category. Consult the following site, https://www.bis.doc.gov/, to check if your item is on the Commerce Control List (CCL). This helpful resource offers the chance to even speak to an Export Counselor. (Be careful, however. As stated throughout my blogs, it’s important to always speak with counsel before disclosing any information as it could be used against you in a court of law.)

Even if your item isn’t on a watch list, it may still be classified as “EAR99.” As a result, you may need a license for this item depending on its use and/or shipment destination. Whenever talking to manufacturers or suppliers, be sure they are aware of each item’s classification. It behooves you to track these details within your current inventory system and to require every employee to do the same.

The Arms Export Control Act (AECA), on the other hand, applies to materials explicitly for military use. The primary point of this act is to ensure any weapons provided by the US are for the strict purpose of “legitimate self-defense.” Transported items may be evaluated based on their ability to serve as weapons of mass destruction or to accelerate an arms race. As you can probably guess, these types of violations aren’t taken lightly. Federal courts get involved in these types of matters and the penalties can be severe.

The principles and goals of the International Trafficking in Arms Regulations (ITAR) are very similar to AECA, although they’re carried out by different agencies. These restrictions, also for international, military-related technologies, are enforced by Homeland Security agents. Customs and Borders Protection officers inspect exports at border crossings and ports.

Whether the item for shipment is for commercial or military use, all exports must be thoroughly evaluated by you, your team, and possibly government officials before you can be confident you’re not breaking any laws. Otherwise you may be at risk for a serious violation and a criminal problem. If you have questions about your company’s exports or you are the target of an export investigation, don’t hesitate to contact my office today as I would be more than happy to offer confidential advice.

Chase Geiser