Managing the Movement of Goods, Technology, and Technical Information
Export controls extend far beyond the physical shipment of products outside the United States. They may regulate software transmitted electronically, technical data shared with a foreign affiliate, source code accessed through a network, services provided to an international customer, and technology released to a foreign-national employee within the United States.
Whether government authorization is required depends upon the item or technology, its technical capabilities, destination, recipient, and intended end use. Saluja Law, PLLC assists manufacturers, technology companies, research organizations, exporters, and international businesses in evaluating these requirements, obtaining necessary authorizations, and developing practical controls to prevent unauthorized exports and technology transfers.
Export Administration Regulations
The Export Administration Regulations, administered by the U.S. Department of Commerce's Bureau of Industry and Security, regulate many commercial and dual-use commodities, software, and technologies with both civilian and potential military, national-security, or strategic applications. The regulations appear principally in 15 C.F.R. Parts 730 through 780.
Determining whether a license is required begins with establishing whether the item or activity is subject to the EAR. The exporter must then identify the applicable Export Control Classification Number, destination, transaction participants, end user, and intended end use. The analysis must also consider license exceptions and any special restrictions involving the destination, recipient, or activity.
The Commerce Control List in 15 C.F.R. Part 774 assigns ECCNs to controlled commodities, software, and technology. The ECCN identifies the reasons for control and is considered with the Commerce Country Chart and other EAR provisions to determine licensing requirements.
Items subject to the EAR but not specifically listed on the Commerce Control List are generally designated EAR99. This designation does not mean that an item may always be exported without restriction. A license may still be required because of the destination, recipient, intended use, or another applicable prohibition.
Saluja Law assists with EAR jurisdiction and classification, ECCN determinations, commodity-classification requests, export licenses, license exceptions, reexports, in-country transfers, end-user diligence, documentation, recordkeeping, and contractual provisions allocating export-control responsibilities.
Restricted End Users, End Uses, and Destinations
An export that appears permissible based upon its classification may still be prohibited because of the parties or intended use. 15 C.F.R. Part 744 contains restrictions involving military, intelligence, nuclear, missile, chemical, biological, and other controlled end users and activities.
Businesses should screen purchasers, consignees, intermediaries, freight forwarders, financial institutions, beneficial owners, and other significant transaction participants. The review should also consider shipping routes, end-user statements, diversion risks, and warning signs suggesting that the identified customer, destination, or end use may not reflect the actual transaction.
Customer assurances alone may not be sufficient. Exporters must evaluate the transaction as a whole and investigate circumstances creating reason to believe that an item may be diverted or used improperly.
International Traffic in Arms Regulations
Defense articles, defense services, and related technical data may be subject to the International Traffic in Arms Regulations, administered by the Department of State's Directorate of Defense Trade Controls. The ITAR implement Section 38 of the Arms Export Control Act, 22 U.S.C. § 2778, and appear in 22 C.F.R. Parts 120 through 130.
Articles, services, and technical data designated on the United States Munitions List are governed by a specialized regulatory framework. Depending upon the activity, a business may need to register with DDTC and obtain authorization before exporting a defense article, furnishing a defense service, transferring technical data, or allowing a foreign person to access controlled information.
The analysis may involve Munitions List classification, commodity-jurisdiction requests, registration, licenses, technical-assistance agreements, brokering, foreign-person access, reexports, retransfers, and changes in end use. Technical data is independently controlled under 22 C.F.R. Part 125, even when no physical product leaves the United States.
Deemed Exports and Foreign-National Employees
Under 15 C.F.R. § 734.13, releasing controlled technology or source code to a foreign person within the United States may be treated as an export to that person's applicable country of nationality. A release may occur through technical discussions, visual inspection, engineering files, source-code repositories, laboratory or production access, remote server access, or technical training.
These requirements are particularly important for companies employing foreign-national engineers, scientists, researchers, technicians, executives, and consultants. Employers filing certain Form I-129 nonimmigrant petitions must certify whether a license is required before controlled technology or technical data can be released to the beneficiary. If authorization is required, the employer must prevent access until the license is obtained. USCIS provides additional information regarding the Form I-129 export-control certification.
Saluja Law's combined immigration and international trade experience allows us to coordinate immigration filings with export classification, licensing analysis, and workplace access restrictions. This helps ensure that statements in the immigration petition remain consistent with the employer's technology and actual compliance practices.
Technology Control Plans and Licensing
When foreign nationals or outside parties work in an environment involving controlled technology, a Technology Control Plan can establish appropriate access restrictions. The plan may identify the controlled technology, authorized personnel, physical and electronic safeguards, segregated files and workspaces, network restrictions, visitor procedures, training requirements, and reporting protocols.
A written plan must reflect the company's actual operations and be supported by practical safeguards, employee training, and continuing oversight. Restrictions that exist only on paper may not adequately prevent an unauthorized release.
When a license is required, the application must accurately describe the item, technology, destination, transaction participants, and intended end use. 15 C.F.R. Part 748 governs EAR classification requests, advisory opinions, and license applications.
Saluja Law assists with BIS export and deemed-export license applications, commodity-classification requests, end-user statements, technology-control documentation, ITAR licenses and agreements, technical narratives, and responses to government inquiries. Receiving a license does not end the compliance obligation. Businesses must follow all conditions, provisos, reporting requirements, destination limitations, and recordkeeping duties contained in the authorization.
Internal Reviews and Voluntary Disclosures
When a possible violation is discovered, the company should preserve relevant records, stop any continuing unauthorized activity, and determine the scope of the issue. Potential violations may involve unlicensed shipments, incorrect classifications, prohibited end users, unauthorized technical-data releases, or failure to comply with license conditions.
The Export Control Reform Act authorizes substantial civil and criminal penalties for export-control violations under 50 U.S.C. § 4819. The EAR also provide a voluntary self-disclosure process through the Office of Export Enforcement. BIS may treat a qualifying disclosure as mitigating, while a deliberate decision not to disclose a significant apparent violation may be considered aggravating. See 15 C.F.R. § 764.5.
Saluja Law assists with internal investigations, transaction reviews, corrective-action plans, voluntary disclosures, and improvements to export-compliance procedures.
Supporting Lawful International Growth
Export compliance should be incorporated into product development, sales, contracting, information technology, human resources, immigration, shipping, and international business planning. Reviewing these requirements before technology is shared or a shipment departs can prevent delays, enforcement exposure, and disruption of important commercial relationships.
Whether a company is exporting a product, transferring technology to an affiliate, hiring a foreign-national employee, entering a new market, or responding to a government inquiry, Saluja Law can help identify the applicable requirements and develop a practical compliance strategy.
Contact Saluja Law, PLLC to discuss export classifications, license requirements, deemed exports, technology transfers, ITAR compliance, or related immigration considerations.