Exporting Regulations

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(upbeat music) Let's explore the regulations surrounding exports from the United States. We'll cover the main export control regulations, what they allow, and which restrictions they impose. Additionally, you'll learn about the exclusions from these restrictions. The United States has three main export control regulations: the Export Administration Regulations, the International Traffic in Arms Regulations, and the Office of Foreign Assets Control. Let's begin with the Export Administration Regulations. In general, the EAR controls the exporting of equipment, materials, and technology that have purely commercial uses, can be used for commercial and military purposes. These are often referred to as dual-use items. And are military items that are not controlled by the International Traffic in Arms Regulations. The Export Administration Regulations is where the Commerce Control List comes from. The regulations also list 10 general prohibitions. These are export and re-export of controlled items to specific countries without a license, re-export and export of foreign made items that use a specific percentage of controlled items, re-export of foreign produced direct product of specific technology and software without a license to specific countries, violation of denial orders, knowingly exporting or re-exporting any item to a prohibited end user or for a prohibited end use, export or re-export of items to a destination that is embargoed by the US, supporting proliferation activities as a US person, export or re-export of an item through or transporting an item through specific countries, violating the terms and conditions of licenses, and continuing with a transaction knowing that a violation of the EAR has occurred. For more information about each of these, review the Export Administration Regulations. The EAR are also sets record keeping requirements. Records that must be retained include, but are not limited to: invitations to place bids, financial records, documents and reports about boycotts, and notifications from the Bureau of Industry and Security. These records must be retained for five years. The EAR is enforced by the Department of Commerce's Bureau of Industry and Security. Violations of the law can result in criminal or administrative penalties. Criminal penalties include up to 20 years in prison and up to $1 million in fines per violation. Violators may receive both penalties. Administrative penalties include up to $300,000 per violation or twice the value of the transaction, whichever is the higher amount. The administrative penalty can be adjusted annually to account for inflation. The Bureau of Industry and Security also has the power to revoke export licenses and deny any or all exporting privileges of an organization or individual.