The Detroit law firm of Abbott Nicholson, P.C. provides specialized legal representation and counsel to U.S. and foreign companies in the defense industry. Its attorneys have expertise in U.S. export control laws including the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations (EAR). Abbott Nicholson, P.C. assists its clients in complying with these and related laws such as business immigration law, employment and contract.
Overview of the International Traffic in Arms Regulations (“ITAR”)
Implemented under the Arms Export Control Act (“AECA”), the ITAR regulates the export of defense articles, defense services, and related defense technical data to “foreign persons” (i.e. foreign individual, foreign company, or foreign country).
The term “export” is defined as either: sending or taking a defense article out of the U.S. in any manner; disclosing or transferring technical data to a foreign person, whether in the U.S. or abroad; performing a defense service on behalf of, or for the benefit of, a foreign person, whether in the U.S. or abroad; or disclosing or transferring in the U.S. any defense article to an embassy or any agency of a foreign government.
The term “article” includes the following: any goods and/or data which are inherently military in nature; have been specifically designed or modified for military use; or, which by their nature or characteristic are intended solely for military utility. It also includes any item designated on the U.S. Munitions List (“USML”).
Without the appropriate authorizations from the U.S. government, defense articles, services and data cannot be exported to foreign persons.
Since 9/11, the United States government has significantly increased its national security efforts especially in the area of international exports. As a result, enforcement of the ITAR is a priority for the Department of Justice (“DOJ”) and any violations of the ITAR can impose significant civil and criminal penalties on both the company and the individuals involved.
The Export Administration Regulations (“EAR”)
The EAR primarily regulates the export of commercial related items such as “dual-use commodities”, software and technology. Dual-use items are predominantly for commercial uses with no intrinsic military function but may have a potential military application. (i.e. computers, jeeps, trucks, light aircraft). The Department of Commerce is charged with controlling dual-use items and subjects them to certain licensing requirements. However, once a dual-use item has been modified for specific military use, it falls under the control of the Department of State and the ITAR applies.
The EAR also prohibits the participation of U.S. citizens in other nation's economic boycotts or embargoes. The Antiboycott provisions of the EAR apply to all "U.S. persons," defined to include individuals and companies located in the U.S. and their foreign affiliates. These persons are subject to this law when their activities relate to the sale, purchase, or transfer of goods or services (including information) within the U.S. or between the U.S. and a foreign country. This covers U.S. exports and imports, financing, forwarding and shipping, and certain other transactions that may take place wholly offshore.
Therefore, it is important that companies are aware of and comply with export control laws to avoid violations of these laws and the penalties associated with such violations.
Legal Assistance and Compliance in U.S. Export Control Laws
Abbott Nicholson, P.C. is able to provide its clients in the defense industry legal advice on the ITAR and EAR and assist its clients with the following:
• Registration with the Department of State
• Establishment of an export compliance program to comply with U.S. export laws and regulations
• Application for export authorizations from the Department of State such as export licenses (i.e. DSP-5), agreements (i.e. TAA, MLA, DA), and exemptions
• Review and negotiation of defense contracts
• Establishment of ITAR flow down requirements to suppliers
• Process Assessments
• Audits
• Investigations
• Voluntary Disclosures
• Enforcement litigation
Abbott Nicholson also provides assistance in the following related areas:
Employment based immigration matters concerning foreign nationals employed in an executive, technical, or academic position within a U.S. based company requiring the company to obtain both an export license and a visa. Please click on the immigration section of this website for more detail.
Business matters such as the review and negotiation of contracts and agreements concerning defense articles, services and/or related technical data. Please click on the corporate law section of this website for more detail.
All employment and/or labor matters. Please click on the labor and employment law section of this website for more detail.
When your company needs practical legal assistance with U.S. export laws and regulations and related areas of law, please contact William D. Gilbride, Jr. or Heidi E. Warren at the Detroit law firm of Abbott Nicholson, P.C. at 313-566-2500.
