Export Regulation Penalties

The following export regulation penalties may apply to an employee and/or the company, depending on the activity, that may result in criminal or civil action by the U.S. Government.  Not knowing the regulations or being ignorant about a transaction does not afford any protections.

• All employees are reminded that willful neglect, defined as “as a conscious, intentional failure or reckless indifference,” will bring the worst penalties available.
• Intentionally trying to hide a violation is not a good idea, and if it is determined by company management that this has occurred, it will likely be grounds for immediate termination.

Penalties Under ITAR

As specified by the International Traffic in Arms Regulations in the Code of Federal Regulations (CFR):

1. Willful Violation of the AECA – USC 2778(c): Up to $1,271,078 per violation or imprisoned not more than 20 Years, or both and possible Debarment from federal contracts.
2. Incentive Payments – USC 2779(a):  The greater of $1,055.721 or five times prohibited payment amount.
3. Exports/Imports Control – USC 2778(e):  Up to $ 1,271,078 per violation and possible Debarment from federal contracts.
4. Embargoes – U.S.C. 2780(k):  $1,256,607 penalty for each violation, or up to 20 years’ prison or both.

Penalties Under the EAR

As specified by the Export Administration Regulations in the Code of Federal Regulations (CFR):

1. Civil penalties may be the greater of $300,000 or twice the value of the transaction
2. Criminal penalties up to $1,000,000 and/or up to 20 years imprisonment per violation
3. Debarment and denial of export privileges.

Penalties Under the OFAC

As specified by the Office of Foreign Assets Control in the Code of Federal Regulations (CFR):

Applicable schedule amount  means:

1. $1,000 with respect to a transaction valued at less than $1,000;
2. $10,000 with respect to a transaction valued at $1,000 or more but less than $10,000;
3. $25,000 with respect to a transaction valued at $10,000 or more but less than $25,000;
4. $50,000 with respect to a transaction valued at $25,000 or more but less than $50,000;
5. $100,000 with respect to a transaction valued at $50,000 or more but less than $100,000;
6. $200,000 with respect to a transaction valued at $100,000 or more but less than $200,000;
7. The statutory maximum civil penalty per violation of IEEPA listed in section V.B.2.a.v. of this appendix with respect to a transaction valued at $200,000 or more.

Penalties Under the OAC / IRS

Export Regulation Penalties for violation of OAC/IRS include:

1. Criminal penalties imposed for each “knowing” violation can be a fine of up to $50,000 or five times the value of the exports and imprisonment of up to ten years.
2. Administrative penalties for each violation may include general denial of export privileges and fines up to $12,000 per violation.
3. Administrative penalties for each violation may include general denial of export privileges and fines up to $11,000 per violation.

Information Updates

Federal agencies that regulate export update those regulations.  The information presented here is current as of 04/22/2022.

Export Regulation Links

Current links to Export Compliance Agencies can be found here.