Export control

Export control is legislation that regulates the export of goods, software and technology. Some items could potentially be useful for purposes that are contrary to the interest of the exporting country. These items are considered to be controlled. Export of controlled items may be prevented or otherwise regulated where they will be used in a harmful way.[1] Many governments implement export controls.[2] Typically, legislation regulates the export of controlled items and requires exporters to apply for a licence to a local government department, which will assess the desired exports and either grant or deny a licence.

A wide range of goods have been subject to export control, including goods with a military potential, cryptography, currency, and previous stones or metals. Some countries prohibit the export of uranium, endangered animals, national artefacts, and goods in short supply in the country, such as medicines.

HistoryEdit

The United States has had export controls since the American Revolution, although the modern export control regimes can be traced back to the Trading with the Enemy Act of 1917. A significant piece of legislation was the Export Control Act of 1940 which inter alia aimed to restrict shipments of material to pre-war Japan. In the United Kingdom, the Import, Export and Customs Power (Defence) Act of 1939 was the main legislation prior to World War II.[3]

PrinciplesEdit

In most export control regimes, legislation lists the items which are deemed 'controlled', and lists the destinations to which exports are restricted in some way. The lists of what is controlled often arise from some harmonised regime.

ClassificationEdit

Goods may be classified using a various classification systems. The United States uses the Export Control Classification Number (ECCN),[4] India uses the Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) list[5] and Japan uses Ministry of Economy, Trade and Industry (METI) lists.[6]

Some items may be categorised as "designed or modified for military use", some as dual use, and some will not be export controlled.[7] Dual use means that the device has both a civilian and a military purpose.[8]

In several jurisdictions, classifications distinguish between goods, equipment, materials, software and technology; the last two being often considered intangible. Classifications may also be by destination purpose, including cryptography, laser, sonar and torture equipment.

DestinationEdit

An exporting country will consider the impact of its export control policy on its relationships with other countries. Sometimes countries will have trade agreements or arrangements with a group of other countries, which may specify that licences are not required for certain goods. For example, within the EU, licences are not required for shipping civilian goods to other member states;[9] however, licences are required for restricted, military goods.[10]

The exporting country's legislation will demand certain handling for goods in different classifications to destination countries. This could include:

  • The destination is subject to sanctions, perhaps economic sanctions. Exports of that class of goods will not be permitted.
  • Shipping the goods may require licences from the government. These licences may require record keeping, so the exporter has to log the items and destinations. Where records are kept, there may be an audit, or there may be some requirement to report the transactions periodically.
  • some have no restrictions and that class of goods can be shipped without impediment from export control legislation.

The end user of the goods or some broker will typically be declared, and similar restrictions apply as to countries.

Some individuals or entities may be listed, so that even if the item could normally be exported to the country without a licence, additional restrictions apply for that individual or entity.[11]

LicenceEdit

For any given item being exported, the categorisations will typically lead to different treatments for a given destination, e.g. 'No Licence Required' (NLR) or 'Licence Required'.[7]

If a licence is required, a declaration from the end user will usually be required. This could be an End User Undertaking (EUU),[12] an End User Statement (EUS)[13] or an End-user certificate. These EUUs will typically include intended use, and make assurances as to the applications for the goods, e.g. not to be used within missiles.

Licences can subsequently be obtained from the appropriate government department in the exporter's jurisdiction.

A licence will usually have some terms, such as:

  • include the licence number with the shipping documentation
  • include some text with the documentation accompanying the item
  • notify some authorities and make the item available for inspection prior to shipment
  • keep a records of the shipment, and allow a potential audit
  • report the shipments made to some authority within some period.

CircumventionEdit

During the development of the Lockheed SR-71 Blackbird supersonic spy plane, the US used 'Third-world countries and bogus operations' in order to obtain sufficient ore to create the titanium for the aircraft[14]

WorldwideEdit

Organisations for harmonisation of controlled itemsEdit

These are known as Multilateral export control regimes

United States of AmericaEdit

The coordinating body is the Export Enforcement Coordination Center (E2C2),[15] and the web-based licence system is SNAP-R.[16] Several of the functions of the US Bureau of Industry and Security (BIS) pertain to Export Control, including the Office for Export Enforcement.

Companies engaging in export may be required to establish an Export Management and Compliance Program.

There are some particular treatments for cryptographic exports, where the NSA may require separate notification of intent to publish cryptographic software.[17]

European UnionEdit

Council Regulation (EC) No 428/2009 of 5 May 2009 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items[18] is the EU Regulation that requires member states to enact legislation that supports export control.

The "dual use" regime was established in 2000.[19]

Great BritainEdit

The principal legislation is the Export Control Order 2008.[20] There is the similar-sounding Export Control Act of 2002 which grants powers to the Secretary of State to impose such rules.[21]

Items are listed in the “UK strategic export control lists”.[22]

It is administered by the Export Control Joint Unit (ECJU), part of the Department for International Trade,[23] with a web-based administration system SPIRE.[24] ECJU also manage enforcement and audit of licence compliance.[25]

Licences[26] include Standard Individual Export Licences (SIEL),[27] Open Individual Export Licences (OIEL)[28] and Open General Export Licences (OGEL)[29] formerly known before 2013 as an Open General Licence (OGL).

See alsoEdit

ReferencesEdit

  1. ^ Department Of State. The Office of Electronic Information, Bureau of Public Affairs (March 8, 2011). "Overview of U.S. Export Control System". state.gov.
  2. ^ "Information Note 15th Export Control Conf Prague" (PDF). un.org.
  3. ^ "Historical Background of Export Control Development in Selected Countries and Regions" (PDF). cistec.or.jp.
  4. ^ "Flexport Glossary Term | Export Control Classification Number (ECCN)". www.flexport.com.
  5. ^ "Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) export of which is regulated" (PDF). dgft.gov.in. Retrieved 2020-03-10.
  6. ^ "Overview" (PDF). www.cistec.or.jp. Retrieved 2020-03-10.
  7. ^ a b "But Export Controls are nothing to do with ME" (PDF). www.egad.org.uk. 2015. Retrieved 2020-03-10.
  8. ^ Stockholm International Peace Research Institute. "Dual-use export controls". SIPRI. Retrieved 2020-03-10.
  9. ^ "Dual-use trade controls - Trade - European Commission". ec.europa.eu.
  10. ^ "NOTICES FROM MEMBER STATES" (PDF). trade.ec.europa.eu. Retrieved 2020-03-10.
  11. ^ "Denied Persons List". www.bis.doc.gov.
  12. ^ "End-user undertaking (EUU) form". GOV.UK.
  13. ^ "export.gov". www.export.gov.
  14. ^ Lockheed SR-71 Blackbird#Acquisition of titanium
  15. ^ https://2016.export.gov/e2c2/index.asp
  16. ^ https://snapr.bis.doc.gov/
  17. ^ https://www.eff.org/deeplinks/2019/08/us-export-controls-and-published-encryption-source-code-explained
  18. ^ "Council Regulation (EC) No 428/2009 of 5 May 2009 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items". eur-lex.europa.eu.
  19. ^ "Council Regulation (EC) No 1334/2000 of 22 June 2000 setting up a Community regime for the control of exports of dual-use items and technology". eur-lex.europa.eu.
  20. ^ Participation, Expert. "The Export Control Order 2008". www.legislation.gov.uk.
  21. ^ "The Export Control Act 2002". www.legislation.gov.uk.
  22. ^ "UK strategic export control lists". GOV.UK.
  23. ^ "Export Control Joint Unit". GOV.UK.
  24. ^ https://www.spire.trade.gov.uk/
  25. ^ https://www.gov.uk/government/publications/compliance-visits-explained
  26. ^ "Licence types: FAQs". GOV.UK.
  27. ^ "Standard Individual Export Licences". GOV.UK.
  28. ^ "Open individual export licence (OIEL) undertaking template". GOV.UK.
  29. ^ "Open general export licences (OGELs)". GOV.UK.