Export Control Classification – ITAR and EAR
Export Control Classification Requirements
Export Control Classification is required of businesses selling products that fall under the jurisdiction of any federal regulations. An export can include sale of goods within the United States to a person or entity that is not a U.S. person. A transfer of technical data can also be considered an export which can be conducted by means of a phone call or email.
Export Control Classification begins with the defining the technical specifications for the item to be transferred. This applies to actual shipments as well as transfers of technical data. It is important to note that a given product may fall under numerous classifications based on how regulations are interpreted.
It is essential to ensure that a thorough analysis be conducted to ensure that due diligence for compliance has been met. Therefore it is not prudent to rely on a customer’s or supplier’s classification as there are severe consequences for non-compliance.
Performing an Export Classification
Types of Import and Export Regulations:
The following groups of regulations should be reviewed when determining the classification for an item for export or import:
- United States Munitions List (USML) – The USML enumerates articles intended for defense applications. USML controlled items fall under the jurisdiction of the International Traffic in Arms Regulations (ITAR).
- Export Control Classification Number (ECCN) – ECCN designations pertain to items controlled by the Export Administration Regulations (EAR).
- Harmonized Tariff Schedule of the United States (HTS) – The HTS number determines the rate of import duty.
- Schedule B – Schedule B is used by the U.S. Census Bureau to track the amount of goods being exported from the U.S.
After Export Control Classification has been performed a determination can be made as to whether or not a license is required. This involves review and documentation of the following criteria:
- what is the export control classification of the article (item) or technology (documents, photos, technical data)
- where it is going
- who is the end-user or recipient of the technology transfer
- what is the end-use
Conducting an Export Control Classification
Step 1: Establish if article is ITAR Controlled – USML Category (Exports)
Review the U.S. Munitions List (USML) to self-assess if your export (hardware, technical data, and/or defense services) is ITAR controlled.
Step 2: Determine if the article is EAR Controlled (Exports)
If the item to be classified falls under the jurisdiction of the U.S. Department of Commerce, a determination of the specific Export Control Classification Number (ECCN) should be conducted. ECCNs are enumerated in the Commerce Control List (CCL). Items that are not listed on the CCL are designated EAR99. The following three methods can be used to determine item classification.
Contact the Item Provider
The manufacturer, producer, or developer can usually provide an ECCN if they have previously exported the item. It should be noted that ECCNs are updated so information provided should be reviewed.
Self classification can be performed if sufficient technical information is available.
c. Submit an Export Classification Request
Commodity classification requests are submitted online at the Simplified Network Application Process – Redesign (SNAP-R).
Step 3: (For Imports Only) HTSUS Determination
Determine the applicable duties as enumerated in the HTSUS classification codes.
Step 4: Schedule B Code (Exports)
Determine the 10-digit Schedule B number. Schedule B numbers are required to for exports over $2,500 or when an item requires a license for export.
CVG Strategy Export Compliance Expertise
CVG Strategy experts can help you with export control classification of articles and technology. Our specialists have classified thousands of products, services and technology over the years.
If you are part of a large corporation or a small company with a part-time compliance person, CVG Strategy has the compliance and training programs to help you meet ITAR and EAR rules and requirements. As the BIS place controls on a growing number of technologies it becomes increasing difficult for smaller businesses to stay abreast of regulatory developments. Because of this we offer outsourced Export Compliance Officer services. We also offer signs and accessories to aid in Visitor Access Control on our ITAR Store.
CVG Strategy, LLC is recognized the world over as the premier provider of customized ITAR Consulting and ITAR & Export Compliance Programs and Training that addresses critical U.S. Government regulations, from Export Administration Regulations (EAR), to the International Traffic in Arms Regulations (ITAR) and Office of Foreign Asset Controls (OFAC) and other regulatory agencies and more.
How Can We Help?
CVG Strategy can assist you in establishing and maintaining an export compliance program. We also can provide guidance with Canadian Controlled Goods Program.
We also offer quick answers to specific ITAR Questions