Practice/Industry Group Overview
The mission of the U.S. government's system of export control laws and regulations is to ensure that controlled products, services, software and technologies are not provided to certain prohibited countries, entities or individuals, or made available for certain prohibited end uses. However, meeting changing U.S. compliance requirements while engaging in cross-border business is an ever-more complex job in the post-9/11 environment. As a result, Greenberg Traurig’s Export Controls Practice places an emphasis on meeting both the transactional and U.S. regulatory requirements for clients selling internationally in highly regulated commercial, defense, aerospace and other high-tech sectors. Our attorneys working on export controls are experienced in these regulatory requirements and frequently counsel clients on the application of these laws to U.S. and foreign businesses. Our team advises clients on a range of international technology transfer issues, as well as compliance and licensing matters.
U.S. Export Control Policy
The U.S. government has developed a system of export control laws and regulations to ensure that controlled products (i.e., “commodities”), software and technologies are not diverted to certain countries, companies or individuals, or for certain prohibited end-uses.
The system imposes controls on both U.S. and foreign persons and entities for the following activities:
- Physical shipment of commodities offshore
- Disclosure of controlled technology to foreign nationals in the United States or offshore
- Licensing of technology offshore
- Performance of certain technical services
- Hiring of foreign nationals to handle, or have access to, controlled commodities, software and/or technology
- Export and re-export of foreign-produced commodities and technology with U.S. origin content
Penalties for export control violations may include disciplinary action (up to and including termination of employment), corporate fines, revocation or suspension of export privileges, and individual fines and/or imprisonment of responsible personnel. Mitigating circumstances in enforcement actions are critical to the reduction of potential penalties. As a result, clients may depend on experienced counsel, with solid agency relationships, who can advise on the export compliance and enforcement process.
U.S. Government Export Enforcement Agencies
U.S. export controls are regulated by several governmental agencies depending upon the type of commodity, software and/or technology that is the subject of the export. The Department of State, Directorate of Defense Trade Controls (DDTC) has jurisdiction over military defense articles, the technical data related to those defense articles, and the provision of “defense services.” Such defense articles, technical data and defense services are identified on the U.S. Munitions List (USML), which is contained within the International Traffic in Arms Regulations (ITAR).
The Department of Commerce, Bureau of Industry and Security (BIS), pursuant to the Export Administration Regulations (EAR), has jurisdiction over non-military/commercial and dual-use commodities. “Dual use” refers to commodities, software or technology that have predominant commercial/non-military application but could be of strategic importance if such items were used for military purposes. These items are identified on the Commerce Control List (CCL), which is contained within the EAR. BIS also exercises jurisdiction over certain re-exports from foreign countries of U.S.-origin commodities, software and technology. Finally, in certain instances, BIS has jurisdiction over exports from foreign countries of foreign-made commodities that are manufactured from U.S.-origin technology or contain U.S.-origin parts or components.
The Department of the Treasury, Office of Foreign Assets Control (OFAC) and DDTC manage U.S. embargoes and trade sanctions imposed against certain countries deemed hostile to the United States.
U.S. Government Prohibited Lists
There are various lists promulgated by the U.S. government identifying those entities with which a U.S. person either may not do business or may not do business without permission from the U.S. government. No commodities, software or technology may be exported to the persons and entities identified on these lists without prior U.S. government approval. U.S. companies have an affirmative legal obligation to refer to these lists prior to conducting business with non-U.S. persons.
- Assist companies in developing export compliance procedures and export management systems
- Counsel companies on the export classification of their commodities, technologies, software and services
- Prepare licenses and agreements, followed by submission before the Departments of State, Commerce, Treasury, Justice (e.g., Bureau of Alcohol, Tobacco and Firearms) and Energy
- Guide companies through export controls due diligence in domestic and multinational transactions
- Defend companies in administrative and criminal export control-related prosecutions
- Counsel on legislative and agency relations related to U.S. export policy
- Conduct internal training to best manage export compliance