Refresher on Export Regulations 

Exporters need to remember that the Export Administration Regulations (EAR) are not the only set of rules that can affect their ability to sell to foreign customers. The International Traffic in Arms Regulations (ITAR) cover military products, defense services (consulting services to the military in any way), and technical data.

Similar to the Commerce Control List within the EAR, the ITAR lists defense products and services in the U.S. Munitions List (USML). USML categories include firearms, missiles, explosives, military vehicles, aircraft, electronics, and many more, 21 in total. Components, parts, accessories, etc., if specifically designed or modified for use with USML items are also covered by the ITAR. Tooling and equipment for the production of military equipment is also included. A miscellaneous category covers "any article not specifically enumerated in the other categories of the USML which has substantial military applicability and which has been specifically designed or modified for military purposes." Some commercial items, including night vision products and satellites, are covered by the USML, even though they may be for commercial use only.

The major difference between ITAR and EAR is that any product within the ITAR jurisdiction needs an export license from the Department of State for EVERY EXPORT to ALL COUNTRIES. The list of countries for which ITAR licenses would likely be denied is different than for EAR. The list for ITAR includes Venezuela, Vietnam, and China, among many others.

An ITAR license is valid for four years. The license expires when the total value or quantity authorized has been shipped or when the date of expiration has been reached, whichever occurs first. Defense articles to be shipped thereafter require a new application and license. The new application should refer to the expired license.

A manufacturer of a military item, even if just for the U.S. military and not for export, MUST register with the Directorate of Defense Trade Controls. Registration is a prerequisite for applying for a license for export. If a company was not aware of the licensing requirement, and subsequently starts to apply for licenses, the Department of State will likely determine that all prior exports were violations of the ITAR. Therefore, it is recommended that if a company is in this situation, it should submit Voluntary Disclosures with their first license application, under the advice of a trade attorney.

For more information regarding these regulations, see www.pmddtc.state.gov. You can learn more about export compliance in general at the upcoming Wisconsin International Trade Conference, May 13, 2008 in Milwaukee.

-- Susan Dragotta, Commerce Latin America Specialist and Outreach Consultant for Southeast Wisconsin