A Foreign Person Determination is a requirement when a business is conducting an export. A foreign person is a person who is not a lawful permanent resident of the United States. The term also applies to foreign corporations, business associations, partnerships, or any other entity not incorporated in the United States.
U.S. Companies need to understand how to confirm a Foreign Person Definition when conducting an export or deemed export. U.S. Governmental agencies define the term “Export” broadly. The term export is not limited to the shipment of an item to an overseas country.
Determination of US Person
or Foreign Person status is of importance when conducting exports of items controlled by the International Traffic in Arms (ITAR) and the Export Administration Regulations. These regulations apply to defense articles, items specially designed for defense applications, and items which are determined to have a “dual use”. Both the ITAR and EAR have their own methodology to confirm and verify a Foreign Person Definition for US Companies to apply.
ITAR Foreign Person Definition
§ 120.63 Foreign Person Definition
The ITAR definition of foreign person is delineated in 22 CFR 120.63. It states that a foreign person is:
Any natural person who is not a lawful permanent resident as defined by 8 U.S.C. 1101(a)(20)
or who is not a protected individual as defined by 8 U.S.C. 1324b(a)(3). It also means any foreign corporation, business association, partnership, trust, society, or any other entity or group that is not incorporated or organized to do business in the United States, as well as international organizations, foreign governments, and any agency or subdivision of foreign governments (e.g., diplomatic missions).
EAR Foreign Person Definition
A foreign person under EAR is defined in 15 CFR 772.1. However the definition does not apply to part 760 of the EAR (Restrictive Trade Practices or Boycotts). This part of the EAR which encourages or requires U.S. businesses to not engage in foreign boycotts that place unfair burdens on U.S. allies, in particular, Israel.
Managing the Complexities of Export Law
Maintaining compliance to U.S. export laws is a challenge for businesses. There are various level of regulations, each of which are extremely complex. CVG Strategy is dedicated to helping U.S. companies work through the maze of compliance an accomplish their business goals within the law.
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CVG Strategy experts can help you establish and maintain an export compliance program. Our systematic approach to integrating export compliance into a quality management framework allows for a seamless integration into effective policies and procedures.We provide ITAR training classes, audits, and provide online answers for your export compliance questions. We can also assist with export control classifications.