Summary of Federal Laws

Research                                                                    

Compliance Partners

Associate Provost for Research

Export Administration Act (EAA) and the Arms Export Control Act (AECA)

The Export Administration Regulations (EAR)  and International Traffic in Arms Regulations (ITAR), as amended by the International Emergency Economic Powers Enhancement Act of 2007

50 U.S.C. § 2401 et seq., 22 U.S.C. § 2751 et seq., and 22 U.S.C. § 6701 et seq.; 15 C.F.R. § 710 et seq. and 22 C.F.R. § 120 et. seq.

These laws must be complied with when non-U.S. persons or foreign nationals are granted access to regulated products or technology by a company or institution of higher education in the United States.  Under the "deemed export" rule, allowing non-U.S. persons or foreign nationals access to the product or technology may trigger the requirement to apply for a license prior to that access.   The EAA and the EAR control the export of dual-use goods and technology (items and technical information that have both commercial and military purposes) and the AECA and ITAR control the export of products and technology with primarily military, intelligence or defense-oriented purposes.

The Export Administration Regulations (EAR)

The Export Administration Regulations (EAR) govern export of goods and services on the Commerce Control List (CCL) (online at The Bureau of Export Administration) and are promulgated and implemented by the Department of Commerce.

Export controls are frequently associated with the following areas:

•     Chemical, Biotechnology and Biomedical Engineering
•     Nuclear Technology
•     Materials Technology
•     Sensors and Sensor Technology
•     Remote Sensing, Imaging and Reconnaissance
•     Advanced Computer/Microelectronic Technology
•     Navigation, Avionics and Flight Control
•     Information Security/Encryption
•     Robotics
•     Laser and Directed Energy Systems
•     Rocket Systems
•     Propulsion System and Unmanned Air Vehicle Subsystems
•     Marine Technology
•     Telecommunications/Networking

Ex  See 15 C.F.R. § 730.5 for definitions on the scope of exports.  In relevant part, this regulation states as follows:

(c) Scope of "exports."  Certain actions that you might not regard as an "export" in other contexts do constitute an export subject to the EAR [Export Administration Regulations].  The release of technology to a foreign national in the United States through such means as demonstration or oral briefing is deemed an export.  Other examples of exports under the EAR include the return of foreign equipment to its country of origin after repair in the United States, shipments from a U.S. foreign trade zone, and the electronic transmission of non-public data that will be received abroad.

(d) U.S. person activities.  To counter the proliferation of weapons of mass destruction, the EAR restrict the involvement of "United States persons" anywhere in the world in exports of foreign-origin items, or in providing services or support, that may contribute to such proliferation. The EAR also restrict technical assistance by U.S. persons with respect to encryption commodities or software.

See also the US Bureau of Industry and Security site for information on Commercial Encryption Export Controls, as well as an Encryption License Exception Chart, and a Question and Answer section on Encryption Policy.  On October 19, 2000, the Bureau of Export Administration published an amendment to the export administration regulations (65 Fed. Reg. 62,600) that implements the Administration's update to its encryption policy announced on July 17, 2000.  The previous regulatory update took place in January 2000.  The new rule will allow exports of encryption products to end-users in the European Union and other trading partners under a license exception.

The International Traffic in Arms Regulations (ITAR)
The International Traffic in Arms Regulations govern the export of defense articles and defense services, i.e. those items with a military application, or to put it more succinctly, as Carol Carr states in her memo (see below under resources) “goods and technology defined to kill people or defend against death in a military setting.”  The licensing conditions for materials covered as military products and technology are set forth at 22 U.S.C. § 2778. The Department of State administers this law.

The munitions list includes such items as firearms, ammunition, explosives, military vehicles, spacecraft, military and space electronics, protective equipment, guidance and control equipment, and some nanotechnology/new materials and sensors. Certain software is also covered. Note that defense services covers furnishing controlled technical data to foreign nationals anywhere, even if such technical data may be in the public domain.

Penalties
The International Emergency Economic Powers Enhancement Act of 2007 significantly increases penalties for export violations, including deemed export violations.  See the Oct. 16, 2007 article titled Increase in Fines for Export/Sanctions Violations: President Bush Signs IEEPA Enhancement Act, by Steptoe and Johnson. The penalty increase applies to almost all economic sanctions programs administered by OFAC, and the anti-boycott and export control rules in the Export Administration Regulations. Click here for a summary of how the IEEPA provides the statutory authority for the continuation in force of the EAR.  

Regulations and Proposed Regulations relating to either ITAR or EAR:

AAU/COGR August 18th, 2008 comments on May 19th, 2008 Federal Register DEAC Report Recommendations: The comments concur with DEAC that too many technologies are currently subject to deemed export control. More specifically, the report recommends the following:

Request for Public Comments on Deemed Export Advisory Committee Recommendations, 73 Fed. Reg. 28795 (May 19, 2008)
Two issues are raised for comment by BIS (due August 18, 2008):  1) whether technologies on the Commerce Control List (CCL) should be narrowed, and 2) whether a more comprehensive assessment of foreign national affiliation should be used for purposes of making home country determinations in the deemed export licensing process. 

Country Group C: Notice of Proposed Rulemaking, 72 Fed. Reg. 8315 (Feb. 26, 2007)
The Dept. of Commerce may designate Country Group C for countries that represent a concern for diversion of items subject to the EAR. If adopted, this would change licensing policy for controlled items going to those countries.

Proposed Rule, Defense Acquisition Regulations System, 71 Fed. Reg. 46434, August 14, 2006
This is a follow up to a proposed rule published by the DOD on July 12, 2005 that was not well received by the academic community. The new proposed rule, which overrides the earlier rule, proposes notification requirements for preventing unauthorized disclosure of export controlled information and technology under Department of Defense contracts. The August version of the  proposed eliminates some of the overly burdensome requirements of the proposed July rule, including the mandate for segrated work areas and badges for researchers. For contracts that require generation of or access to export-controlled information or technology, the contractor will be required to--

•  Comply with applicable laws and regulations regarding export-controlled information and technology;
• Consult with the Department of State on any questions regarding the International Traffic in Arms Regulations (ITAR), and with the Department of Commerce on any questions regarding the Export Administration Regulations (EAR); and
•  Notify the contracting officer if the contractor determines during contract performance that generation of or access to additional export-controlled information or technology is required.
• In addition, under this second proposed rule, for contracts that do not involve generation of or access to export-controlled information or technology, the applicable clauses require contract modification if, during performance, either contractual party becomes aware that the contractor will need to generate or have access to export-controlled information or technology.

See Department of Defense Proposed Rule Highlighs Need for Effective Export Compliance Program for more on the August 14th proposed rule.  

Antiboycott Penalty Guidelines, 71 Fed. Reg. 37517, June 30, 2006

Part 760 (Restrictive Trade Practices or Boycotts) and Part 762 (Recordkeeping) of the Export Administration Regulations (EAR) are collectively referred to as the anti-boycott provisions.  The Bureau of Industry and Security(BIS) enforces these provisions through its Office of Antiboycott Compliance (OAC). 

The proposed rule: (1) Sets forth procedures for voluntary self disclosures to the OAC when there are violations of the antiboycott provisions; (2) Sets forth factors that the OAC considers when deciding to pursue administrative charges or settle allegations of violations of the antiboycott provisions; and (3) Describes how the OAC determines penalties in the settlement of administrative enforcement cases related to the antiboycott provisions. The intent of the rule is to encourage voluntary self-disclosure by defining it and providing procedures for making such disclosures; thus OAC resources can be utilized more effectively by reducing the amount of time spent investigating and identifying possible violations.   

The rule would create new a §764.8 to set forth procedures for voluntary self-disclosure of violations of the antiboycott provisions.  Voluntary self-disclosures must be in writing, must be made with the “full knowledge and authorization of the firm’s senior management,” and must received by the OAC before the Office learns of the same or similar information from “another source” and has begun an investigation in connection with that information. 

The rule would create a new supplement No. 2 to Part 766 that describes how the OAC would address violations of the antiboycott provisions.  In response to a violation, the OAC may issue a warning letter, pursue an administrative case, or refer the case to Department of Justice (DOJ) for criminal prosecution. 

The administrative sanctions included in the proposed supplement No. 2 to Part 766, are: a monetary penalty, a denial of export privileges, and an order excluding the offending party from practice before BIS.  This section first lists the seven general factors such as “degree of seriousness” and “category of violation” that the OAC considers when evaluating a violation of the antiboycott provisions. Next, it considers eight specific mitigating and nine specific aggravating factors to determine what sanctions apply in a given settlement.  Factors identified by the phrase “GREAT WEIGHT” will be given “considerably” more weight than other factors.  For example, a voluntary self-disclosure satisfying the requirements of this regulation is designated as a mitigating factor of “GREAT WEIGHT.”  

This section also sets forth factors that the OAC considers, such as the extent to which the firm’s senior management was aware of the violating conduct, when deciding to impose a denial or exclusion order in the settlement of administrative cases.  Finally, this section lists factors the OAC “may consider in deciding whether to suspend or defer a monetary penalty, or suspend an order denying export privileges or an order providing an exclusion from practice.”

Revisions and Clarification of Deemed Export Related Regulatory Requirements; Withdrawal of March 28, 2005 Advanced Notice of Proposed Rulemaking, 71 Fed. Reg. 30840, May 31, 2006

In response to 311 comments opposing the changes proposed to the deemed export rule proposed changes published in March of 2005, the Bureau of Industry and Security determined that the current rules were adequate. The proposed rule would have required institutions of higher education to obtain export-control licenses for many  more of their foreign students and researchers, greatly increasing the already heavy regulatory burden in this area. Of specific concern was the proposed definition of "use". The general theme among comments from the academic community was that the conjunctive reading of the ``use'' definition properly reflects the policy rationale that currently underlies the controls on the transfer of use technology to foreign national students and researchers. These comments argued that the current ``use'' definition correctly requires the presence of technology relating to all six
activities (i.e., operation, installation, maintenance, repair, overhaul, and refurbishing) because it is the totality of those activities that triggers the requirement for a deemed export license.
Many comments asserted that by changing ``and'' to ``or'' in the definition, mere operation of a controlled item by a foreign national would trigger a requirement for a deemed export license. Numerous comments stressed that the proposed revision would thus result in a large expansion of deemed export license applications submitted to BIS, without any proven increase in security.  

This withdrawal also rejects the OIG's recommendation that deemed export licenses be based upon a foreign national's country of birth rather than country of citizenship. Numerous comments expressed concern that excessive and bureaucratic requirements would foster a perception among foreign students and researchers that the United States does not welcome foreign nationals in its high-technology research community.  Comments also expressed concerns related to potential conflicts of laws. Some comments noted that if forced to apply a country of birth criteria to their employees, companies might run afoul of both U.S. and foreign anti-discrimination and privacy laws. In response to the extensive set of public comments received, BIS established a Deemed Export Advisory Committee. 
 

Establishment of Advisory Committee and Clarification of Deemed Export-Related Regulatory Requirements, 71 Fed. Reg. 29301, May 22, 2006

In this Federal Register announcement, the Bureau of Industry and Security, U.S. Department of Commerce, announces creation of  The Deemed Export Advisory Committee (DEAC). The DEAC  will help ensure that the deemed export licensing policy protects national security at the same time that technological innovation in encouraged. BIS has decided not to make any changes at this time to current regulations regarding country of birth, the existing definition of ``use'' in the Export Administration Regulations (EAR), and the relationship of fundamental research to deemed exports. For more information on current deemed export policy, see the FAQ's on the BIS website.   A separate notice will specifically address the comments received in response to the March 28, 2005 BIS proposed rules on the deemed export regulations referenced below.

Proposed Rule: Defense Federal Acquisition Regulation Supplement; Export-Controlled Information and Technology, 70 Fed. Reg. 39976, July 12, 2005

DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to address requirements for preventing unauthorized disclosure of export-controlled information and technology under DoD contracts.

Proposed Rules on Revised ``Knowledge'' Definition, Revision of ``Red Flags''  Guidance and Safe Harbor, 69 Fed. Reg. 60829 (Oct. 13, 2004)This proposed rule would revise the knowledge definition in the Export Administration Regulations to incorporate a ``reasonable person'' standard and to replace the phrase ``high probability'' with the phrase ``more likely than not.'' The rule  would update the ``red flags'' guidance.  BIS is proposing to update and augment the ``red flag'' guidance and to increase from 12 to 23 the number of circumstances expressly identified as presenting a red flag. Although the ``red flags'' provide guidance, this rule would also incorporate them by reference into the proposed safe harbor and the Internal Compliance Programs requirements of Special Comprehensive Licenses. To clarify the role the red flags would play under this rule, BIS is proposing to add a statement that the red flags and know your customer guidance do not derogate from obligations imposed elsewhere in the EAR and to remove the statement ``This guidance does not change or interpret the EAR'' from supplement No. 3 to part 732.     BIS is proposing to create a safe harbor from liability arising from knowledge-based license requirements, knowledge-based restrictions on use of License Exceptions, and other knowledge provisions in the EAR that are subject to the proposed definition of knowledge described above. Under this safe harbor, parties who take steps identified in a new Sec.  764.7 will not have knowledge imputed to them by application of the ``reasonable person'' standard stated in the new definition. 

Chemical Weapons Convention Regulations

See 64 Fed. Reg. 73,744 (Dec. 30, 1999) for an interim rule and request for comments on regulations (effective Dec. 30, 1999) implementing The Chemical Weapons Convention Implementation Act of 1998. See 22 U.S.C. § 6701 et seq. This law imposes reporting requirements (and on-site inspections) on industries that produce, process or consume certain chemicals. Universities that operate laboratories that contain scheduled chemicals may be subject to an import or export reporting requirement.

Chemical Weapons Convention Regulations: Electronic Submission of Declarations and Reports Through the Web-Data Entry System for Industry (Web-DESI) 
69 Fed. Reg. 2501 (Jan. 16, 2004) Interim Final Rule

This interim final rule amends the CWCR by adding instructions on how to obtain authorization from BIS to make electronic submissions of declarations and reports through the Web-Data Entry System for Industry (Web-DESI), which can be accessed on the CWC Web site.  The rule also establishes procedures for the assignment and use of passwords for facilities, plant sites and trading companies (USC password) and procedures for the assignment and use of Web-DESI user accounts.

Export Administration Regulations: Penalty Guidance in Settlement of Administrative Enforcement Cases, 69 Fed. Reg. 7867, Feb. 20, 2004. This guidance (and supplement) describes how Bureau of Industry and Security (BIS) responds to violations of the Export Administration Regulations.

Resources

August 28, 2009 NACUANOTE: International Academic Travel and US Export Controls

Short summary paragraph from the NOTE:  Academic personnel must consider the potential effect of each set of U.S. export control regulations on the proposed international travel to assure that both the institution and the individual traveler are in compliance. U.S. export control laws are principally concerned with whether the academic traveler will take and then disclose any controlled technology or other controlled information to non-U.S. persons (e.g., in papers or on their laptop computers) or will export any controlled items (e.g., sensors, test instrumentation, reagents, biological materials or other similar tangible goods) to non-U.S. persons. Generally speaking, the EAR considers the shipment or delivery of a tangible good to a non-U.S. person an “export” and regards the disclosure of controlled information to a non-U.S. person a “deemed export

AAU and COGR Response to Report of Deemed Export Advisory Committe  (Feb. 2008)
This report makes suggestions to the Secretary of Commerce on the findings and recommendations of the Deemed Export Advisory Committee report (titled the Deemed Export Rule in the Era of Globalization and submitted Dec. 20th, 2007.

George Washington University Export Control Policy: This policy includes an excellent project analysis tool in the Appendix.

Carol T. Carr, Negotiating the Mine Field: The Conduct of Academic Research in Compliance with Export Controls  NACUA 2006 monograph

editor's note: I had to read this three times to feel I had really absorbed all of the material, but this is one of the best NACUA monographs I have read, and well worth the very reasonable cost.

A Brief Primer on Doing Business Abroad:George Washington University (April 2006) Prepared by Patton Boggs LLP with the Office of the VP and General Counsel

University of Pennsylvania web page on Export Control Laws

Stanford Decision Control Tree

Export Controls in University Research: Basics and Problem Areas
By Mark Bohnhorst, Associate General Counsel, University of Minnesota

Export Controls and Universities: Information and Case Studies: COGR; Feb. 2004

Export Controls: Why Worry? by Joyce Freedman, UC Berkeley

A short but very concise power point of what is technical data, what it means to export, and why it is important to stay within the fundamental research exception

Export Control Compliance web page at University of Minnesota

GAO December 2006 Report: Export Controls: Agencies Should Assess Vulnerabilities and Improve Guidance for Protecting Export Controlled Information at Universities. This report summarizes the finding that government provided training and guidance on export regulations is limited in informing schools efforts to manage and protect export controlled information, and that the guidance does not clarify when the fundamental research exclusions should apply. The report calls upon  Commerce and the State Departments to  provide better guidance to universities on export controls and fundamental research. Comments from both Departments are appended at the end of the report.

Georgia Institute of Technology Export Control Chart: This chart, reprinted with permission of Kate Wasch, Senior Attorney, Office of Legal Affairs, Georgia Institute of Technology,  guides the user through the process of deciding if they need to be concerned about export controls in their research.

Licensing of Deemed Exports and Technology Transfers: Power Point by Camille Caesar, Senior Counsel, Office of Chief Counsel for Industry and Security, U.S. Department of Commerce. This  presentation provides introductory information only. Researchers and senior university officials need to consult with the university general counsel's office to determine steps necessary for regulatory compliance.

UC Berkeley Export Control and Research Page

Contains a concise summary of the laws, an explanation of the fundamental research exclusion for universities, and an explanation of what is considered published information for purpose of the exclusion.

MIT Export Control web Page

University of Chicago: Research, Export Controls and Trade Sanctions Page 

Export Administration Regulations Database

Commerce Country Chart : A chart that lists countries in the horizontal axis, and the reasons for control on the veritical axis. If the Chart marks the block with an X, EAR approval is required prior to exporting an item to the country or releasing the technology to a foreign national employed at the university.