home Export Controls, national security, news, Trade Security & Related USG Announces New Export Control License Exception, Strategic Trade Authorization

USG Announces New Export Control License Exception, Strategic Trade Authorization

Yesterday U.S. Department of Commerce Secretary Gary Locke announced a new license exception to the Export Administration Regulations (EAR) that “authorizes the export, reexport, and transfer (in- country) of specified items to destinations that pose relatively low risk that those items will be used for a purpose that license requirements are designed to prevent.”

“This is an important first step towards creating a system that addresses the serious threats we face in today’s changing economic and technological landscape. This new license exception will eliminate the need for U.S. exporters to seek licenses in nearly 3,000 types of transactions annually, affecting an estimated $1.4 billion in goods and technology,” Locke said. “The new license exception will allow us to focus our resources on items that pose a significant national security risk and help facilitate U.S. exports,” added Locke.

Under the new exception, exports of a large amount of controlled items to more than thirty trade partners will not need a license. However, exporters will still need to secure assurances from the end-user that it will not sell or share the technology. It is not as simple though as that, and while I will spare readers the technical legal jargon, read it closely because it is not a free for all or as clear cut as the public relations spin makes it out to be.

There was no reaction from Members of Congress on the change, but it is likely that key national security committee Members and Staff have already been briefed on the changed. Not sure how large of a splash this announcement will make, however, it will surely be an item of discussion at the Paris Air show next week.

The new rule was published in the Federal Register.

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