U.S. Export Controls COLLECTION COURSE OUTLINE SELECT THE TOPICS YOU WANT

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1 COLLECTION U.S. Export Controls COURSE OUTLINE SELECT THE TOPICS YOU WANT Export Control Reform Why Is Export Compliance Important? Regulation Overview Sanctions and Embargoes ITAR EAR FCPA Anti-Boycott Employee's Role in Export Compliance Dual-Use/EAR Scenarios: Recognizing an Export Risk Marketing & Business Development Danger: A Trade Show Raising the Red Flag Can I Market in an Embargoed Country? Doing Business with Restricted Parties Meetings to Close a Deal Using Technical Data to Market Products Bid & Proposal Development Proposals for Ambiguous Projects End-Use Is Important Spotting Red Flags Having a Meeting to Discuss a Proposal Working with Non-U.S. Partners on Proposals Revising Proposals with Non-U.S. Persons in the U.S. Responding to Customer Inquiries about a Proposal Using Web Sites to Share Proposal Information 1

2 The Customer Wants to Use His Suppliers - Not Yours Requests to Use EAR Products in Military Vehicles Order Processing Making Sure Customers Are Not Restricted Getting the Right Information with Orders Dealing with Boycott Requests Screening Purchase Orders Hiring & Staffing Hiring Third Country Nationals Interviewing Candidates for Employment Making a Job Offer Obtaining Information System Services from Third Parties Engaging Consulting Firms Employee Transfers Working with Third Party Labor Providers Hiring U.S. Persons in Non-U.S. Locations Promotions to New Job Duties Hiring Non-U.S. Persons on Commercial Projects Dealing with Reports of Possible Export Violations Managing Contracts Does Our Contract Require an Export License? Contract Modifications Identifying Export Control Red Flags Is Our Contract with a Restricted Party? Does the Contract Match Our Export License? Contracts and License Conditions Negotiating Contract Terms and Conditions Engineering, Research & Product Development Modifying Standard Products for Customers Working with Third Country Suppliers Handling Supplier Prototypes Setting Up Web Sites to Share Information Teaming with Companies Employing Third Country Nationals Are My Products Export Controlled? Publishing My Research Designing Products Without ITAR Parts Production, Inventory Control & Quality Assurance Conducting Quality Control Visits with Customers 2

3 Posting Technical Data on Web Sites Dealing with Customer Quality Inspections Plant Tours Working with Suppliers and Subcontractors Procurement, Purchasing & Supply Chain Working with Customer Directed Suppliers Is My New Supplier a Restricted Party? Troubleshooting with Suppliers Handling Supplier Product Evaluation Samples ing Data to Suppliers Managing Technical Meetings with Suppliers Working with Supplier Sales Offices Setting Up Web Sites to Share Information with Suppliers Sending Controlled Technical Data to Potential Suppliers Shipping & Receiving Hand Carrying Products to Other Countries Repairs and Returns Shipping to Other Countries Handling Last Minute Shipping Changes Hand Carrying Returns Customer Directed Freight Forwarders Am I Shipping to an Embargoed Country? After Sales Support & Maintenance Hand Carrying Tools/Spares to Customer Sites Troubleshooting Phone Calls Working with Third Country Nationals Returning Products for Testing and Repair Modifying Products Returned for Repair Setting Up External Web-Sites with Controlled Data Providing Technical Assistance at Trade Shows Travel Traveling to Learn about a Non-U.S. Subsidiary's Products Military/ITAR Scenarios: Recognizing an Export Risk Marketing & Business Development Danger: A Trade Show Meetings with Potential Customers Customer Plant Visits 3

4 Plant Visits by Employees from Your Company Demonstrating Your Products to Customers Taking Mock-Ups to Overseas Trade Shows Providing Demonstrations to Multiple Non-U.S. Customers Bid & Proposal Development Joint Proposals with Third Country Partners Responding to Questions from Customers Working with Others in Your Company on a Proposal Proposal Presentations to Customers with Dual Nationals Using Web Sites to Share Technical Data Working with Customer Directed Suppliers Working with Non-U.S. Persons on Proposals Order Processing Am I Dealing with a Restricted Party? Identifying Red Flags Red Flags on Domestic Orders Hiring & Staffing Planning for Hiring Discussions with Job Applicants Hiring Consulting Firms Transfers of Employees from Other Countries Outsourcing Information Technology Using Temporary Employees from Contract Labor Providers Promoting Employees to Different Duties Managing Contracts Does Our Contract Require an Export License? Modifications to Contracts Obtaining Information from Customers for Export Licenses Customer Directed Freight Forwarders Matching Export Licenses to Contracts Negotiating Contracts Supporting Foreign Military Sales (FMS) Programs Providing Maintenance for the U.S. Military Overseas Engineering, Research & Product Development Design Meetings with Customers Working with Customer-Directed Suppliers Handling Prototypes from Suppliers Sharing Data Using Web Sites 4

5 Third Country Nationals on Engineering Teams Is My Software Controlled by the ITAR? Publishing My Research in Trade Journals Making Public Presentations with Controlled Technical Data Production, Inventory Control & Quality Assurance Quality Assurance Visits to Customers Quality Inspections by Customers at Your Facility Plant Tours Using Web Sites to Share Technical Data My Supplier Wants Help Collaborating with Non-U.S. Persons Using U.S. Suppliers with Offshore Operations Procurement, Purchasing & Supply Chain Troubleshooting Visits to Suppliers Using Customer-Directed Suppliers Are My Parts Export Controlled? Handling Samples from Suppliers ing Drawings to Suppliers Meetings with Third Country Suppliers Working with Supplier Sales Offices Using Web Sites to Share Technical Data with Suppliers Possible Export Issues with U.S. Suppliers Shipping & Receiving Last Minute Changes to Shipments Does My Shipment Have a Proper Export Authorization? Hand Carrying Controlled Products Returns for Repair Working with Customer Directed Freight Forwarders Shipping Administrative Requirements Dealing with Possible Mismarked Packages After Sales Support & Maintenance Hand Carrying Tools for Maintenance Work Trouble-Shooting with Customers on the Phone Dealing with Third Country Nationals at Customer Sites Returning Systems for Repair Modifications to Systems During Installation Changing the Location of Systems Previously Delivered Travel Hand Carrying Parts to Non-U.S. Company Locations 5

6 Export Administration Regulations (EAR) Legal Underpinning and Regulatory Framework of the EAR Export Administration Act and International Emergency Economic Powers Act Other Statutory Provisions, Executive Orders and Presidential Documents How the EAR Is Structured Fundamentals of the EAR Definitions of Key Terms Used in the EAR Export Reexport Transfer Item Technology, Technical Assistance and Technical Data Export Control Classification Number (ECCN) Dual Use U.S. Person You Export Control Document Concepts Used in the EAR Subject to the EAR General Prohibitions Deemed Export and Deemed Reexport Release of Technology or Software EAR99 Foreign National Embargoed or Sanctioned Countries End Use and End User Controls Red Flags Export Clearance Routed Export Transaction Publicly Available Denied Persons Restrictive Trade Practices and Boycotts Transaction Screening De Minimis Rule Foreign-Produced Direct Product Rule Types of Export Authorizations Licenses Validated End-User License Exceptions NLR Support Documents for License Applications Statement by Ultimate Consignee and Purchaser 6

7 International Import Certificate PRC End-User Statement General Discussion of the Commerce Control List Other EAR Regulatory Processes, Requirements and Issues Special Reporting Requirements Commodity Classification Requests Encryption Registration, Self-Classification Annual Reports, Classification Requests and Semi- Annual Sales Reports Chemical Weapons Convention Requirements Violations, Voluntary Self-Disclosures and Penalties Quiz (Case Study) EAR Cradle-to-Grave Transaction-Based Project Case Studies - Introduction Business Model 1: EAR Hardware Business Background Case Study 1: EAR Jurisdiction and Classification Case Study 2: Design and Development Case Study 3: Marketing Case Study 4: Contracts and Purchase Orders Case Study 5: After Sales Support Business Model 2: EAR Software Business Background Case Study 6: Classification Case Study 7: Marketing Case Study 8: Contracts and Purchase Orders Conclusion International Traffic in Arms Regulations (ITAR) Legal Underpinnings and Regulatory Framework of the ITAR Arms Export Control Act Layout of the ITAR Fundamentals of the ITAR Definitions of Key Terms in the ITAR U.S. Person Foreign Person Defense Article Technical Data Public Domain Defense Service 7

8 Significant Military Equipment Export Reexport and Retransfer Temporary Import Automated Export System (AES) Empowered Official Eligibility to Export Regular Employee Foreign Ownership and Control Key Concepts in the ITAR Registration How Do Products and Services Get Designated As Defense Articles? Types of Authorizations Licenses Agreements Technical Assistance Agreements Manufacturing License Agreements Warehouse and Distribution Agreements Important Points about Agreements and Their Provisions Sublicensing Determining Value for Agreements Dual and Third Country Nationals in Agreements Hiring Foreign Persons in the U.S. Use of Foreign Person Contract Employees Exporting Hardware Under Agreements Reconsideration of Provisos Post-Approval Requirements for Agreements Amending Licenses and Agreements Rebaselining Agreements Special Comprehensive Export Authorizations for NATO, Australia and Japan Exemptions Temporary Import License Exemptions (Section 123.4) Subsection 123.4(a) Subsection 123.4(a)(1) Subsection 123.4(a)(2) Subsection 123.4(a)(3) Subsection 123.4(a)(4) Subsection 123.4(a)(5) Subsection 123.4(B) Mechanics of Using the Temporary Import Exemptions Reexport and Retransfer Exemption - Section 123.9(E) 8

9 Exemptions of General Applicability (Section ) Section (B)(1) Section (B)(2) Section (B)(4) Section (B)(5) Section (B)(9) Canadian and Mexican Border Shipments (Section ) Defense Services Exemptions (Sections and 126.4) Section 124.2(a) Section 124.2(C) Section 126.4(a) Section 126.4(C) Technical Data Exemptions Section Section Section Section 125.4(B)(1) Section 125.4(B)(3) Section 125.4(B)(4) Section 125.4(B)(5) Section 125.4(B)(7) Section 125.4(B)(8) Section 125.4(B)(9) Section 125.4(B)(10) Section 125.4(B)(13) Section 125.4(C) Dual and Third Country Nationals Section Section Plant Visit Exemptions - Section Canadian Exemptions Section 126.5(a) Section 126.5(B) Section 126.5(C) Section 126.5(D) Transfers by the Department of Defense - Section 126.6(a) Foreign Military Sales Program Exemptions - Section 126.6(C) Conclusion Brokering Brokering Definitions Registration of Brokers 9

10 Licensing and Prior Approval Requirements for Brokers Prior Notification of Brokering Activities Brokering Reports Conclusion Violations and Enforcement What Constitutes a Violation? Penalties for Violations Debarment from Exporting What Happens When There Is a Violation? Voluntary Disclosure and Administrative Proceedings with the State Department Conclusion Commodity Jurisdiction Jurisdictional Determinations Self-Determination Process Formal Commodity Jurisdiction Requests Triggers, Tips and Common Mistakes Determining Whether Products, Data or Services Are ITAR - Controlled Purpose and Background The United States Munitions List Making Commodity Jurisdiction Determinations Self-Determination Process - Part 1 Self-Determination Process - Part 2 Formal Commodity Jurisdiction Requests Triggers, Tips and Common Mistakes A Note about Export Control Reform Recordkeeping General Recordkeeping Requirement Specific Recordkeeping and Related Requirements Technical Data Exports Using Exemptions Reporting of Export Information on Technical Data and Defense Service Annual Reports Required by the ITAR Certification Requirements for Exemptions Recordkeeping for Political Contributions, Fees and Commissions Destination Control Statements Conclusion Congressional Notification -- Summary of the Congressional Certification Requirement Dollar Thresholds for Certain Transactions Congressional Certification Process and Timelines 10

11 Re-Notifications of Congress Political Contributions, Fees and Commissions -- Introduction Definitions Reporting Requirements Under Section 130 Information to be Furnished National Disclosure Policy and Other Special Review Processes National Disclosure Policy Reviews Other Special Review Processes Missile Technology Control Regime Reviews Reviews for LO/CLO and Critical Program Information U.S. Military Department Technology Release Boards Defensive Systems Committee Information Security, Communications Security and Signals Intelligence Reviews Space-Based Positioning, Navigation and Timing Reviews Electronic Warfare in-country Reprogramming Reviews Blue Lantern End-User Checks Technology Control Plans Space Launch Monitoring Gas Turbine Engine Technology Exports Software Documentation General Advice about Special Review Processes Determining Whether Products, Data or Services Are ITAR - Controlled - Scenarios Are Military Applications Always ITAR? Determining Jurisdiction for Products from Suppliers Does End-Use Determine Jurisdiction? Quiz: Upgrades of Military Tanks for the Australian Army ITAR Practitioner Case Studies Business Model 1: ITAR Hardware Business (USCOMM) Background Case Study 1: Determining Export Jurisdiction for USCOMM s Products Case Study 2: Marketing the New Military Radio Products Case Study 3: USCOMM Radios to Canada Case Study 4: USCOMM Radio Manufacturing Arrangement with Germany Case Study 5: USCOMM Use of an Australian Distributor Business Model 2: ITAR Defense Services Business (US-SERV) Background Case Study 6: US-SERV Support to U.S. Army in Qatar 11

12 Case Study 7: US-SERV Maintenance Facility for UK and Kuwait Armies in Kuwait Case Study 8: US-SERV Support Services Contract for the Spanish Air Force in Spain Conclusion 12