FAQs on Export Licensing
A Frequently Asked Questions Guide to Export
Licensing Requirements for Commercial Items *
*This page is designed to give people who are new to exporting, and,
in particular, new to export controls, a general understanding of our
regulations and how to use them. However, nothing provided here can
substitute for consulting the EAR.
Does My Shipment Require an Export License?
Maybe. A U.S. export license requirement from the Department of
Commerce can be triggered by several important factors specific to
your transaction: the actual item (commodity, software or technology)
being exported, where it is going, who is going to use it, and what
they will be using it for. If any of these factors change in your
transaction, the license requirements may change.
What types of items does the Department of Commerce regulate?
The Bureau of Industry and Security (BIS) implements and enforces
the Export Administration Regulations (EAR). The EAR regulate the
export and reexport of most commercial items. We often refer to the
items that BIS regulates as "dual-use" items because they have both
commercial and military or proliferation applications, but purely
commercial items without an obvious military use also are subject to
the EAR.
Does the Department of Commerce regulate all exports?
The Department of Commerce does not regulate all goods, services,
and technologies. Other U.S. Government agencies have export control
responsibilities for regulating more specialized exports. For example,
if you are shipping military goods, your item may be subject to the
licensing jurisdiction of the Directorate of Defense Trade Controls at
the Department of State. The Treasury Department’s Office of Foreign
Assets Controls (OFAC) administers and enforces economic and trade
sanctions against targeted foreign countries, terrorism sponsoring
organizations, and international narcotics traffickers. The BIS
website identifies resource links for various U.S. Government agencies
with export control responsibilities. Go to
http://www.bis.doc.gov/About/reslinks.htm for a listing.
Is there a list of restricted countries to which I can’t export?
Restrictions vary from country to country and from item to item.
The most restricted destinations are the embargoed countries and those
countries designated as supporting terrorist activities, including
Cuba, Iran, Libya, North Korea, Sudan, and Syria.
So how do I know if my shipment needs an export license?
The first step is knowing your item’s Export Control
Classification Number (ECCN). ECCN entries are found on the Commerce
Control List (CCL) and identify reasons for control which indicate
licensing requirements to certain destinations. Other reasons an
export license may be required for your shipment relate to concerns
about the parties to the transaction and the end-use of the item.
Do all items have an ECCN?
Many commercial goods are not on the Commerce Control List and do not
have an ECCN. These goods are designated as EAR99. EAR99 items
generally consist of low-level technology, consumer goods, etc. and do
not require a license in most situations. However, if your proposed
export of an EAR99 item is to an embargoed country, to an end-user of
concern, or in support of a prohibited end-use, you may be required to
obtain an export license.
Where do I find the Commerce Control List?
The Commerce Control List is part of the Export Administration
Regulations (EAR) which can be found on the Government Printing
Office’s EAR database at
http://www.access.gpo.gov/bis/ear/ear_data.html#ccl Scroll down
the page to Part 774. Below are the ten categories of the Commerce
Control List which can be viewed as separate files in several
different formats, including PDF.
So if my item is EAR99, does that mean I don’t need a license?
EAR99 items will generally ship under the designation “NLR” which
stands for “No License Required”. However, if your proposed export of
an EAR99 item is to an embargoed country, to an end-user of concern or
in support of a prohibited end-use, you may be required to obtain an
export license.
What is the difference between EAR99 and NLR?
EAR99 is a classification for an item. It indicates that a particular
item is subject to the Export Administration Regulations (EAR), but
not specifically described by an Export Control Classification Number
(ECCN) on the Commerce Control List (CCL). While the classification
describes the item, the authorization for shipment of that item may
change, depending on the circumstances of the transaction.
NLR
stands for the "No License Required" designation. NLR may be used for
either EAR99 items, or items on the CCL that do not require a license
for the destination. However, exports of an EAR99 item to an embargoed
country, an end-user of concern or in support of a prohibited end-use
may require an export license.
If I determine my item is classified EAR99 and I can ship under NLR,
what do I need to do?
You indicate “NLR” as your authorization for export on the Shipper’s
Export Declaration or Automated Export System record. By signing the
SED or submitting via AES (or designating your freight forwarder to do
so), you are certifying that your item is eligible for NLR. You should
also keep records relating to your NLR determination and the export
transaction for five years.
What is a license exception?
A license exception is an authorization that allows you to export
or reexport, under stated conditions, items subject to the Export
Administration Regulations (EAR) that would otherwise require a
license based on the ECCN and destination.
What do you mean by prohibited end-user or end-use?
If you know or have reason to know your item would support a
proliferation activity, such as nuclear, chemical/biological, or
missile proliferation activities in a country of concern, a license
would be required. Part 744 of the Export Administration Regulations
spells out the specific regulations related to end-user and end-use
controls.
Do the licensing requirements change depending on how I’m sending the
item?
No. Export license requirements stay the same regardless of the
method of shipment or transmission. This includes technology shipments
via the internet or items carried in a briefcase. [Note: although
license requirements may not change, license exception availability
may (i.e. BAG or TMP.]
I’m not a company, I’m just sending something overseas to a friend.
Does this mean I don’t need to worry about whether or not my item
needs a license?
Whether or not something is being given away or sold does not
affect the license requirements of your shipment. You still need to
determine whether or not an export license is required.
Does it matter if what I’m sending is under $2500 dollars?
No. The value of the shipment does not affect the export license
requirements. However, the value of the shipment may affect the
requirements for filing a SED or AES Record. If an export license is
required, a Shipper’s Export Declaration will be required as well,
regardless of value.
Can I just have my freight forwarder fill out the license related
information on the Shippers Export Declaration or AES record?
Your freight forwarder is generally not in a position to determine
your requirements because a technical assessment of your item is
required to determine its ECCN and any associated license
requirements. You are ultimately responsible for the proper export
authorization
What if my customer asks me to send the item to their freight
forwarder here in the U.S.? Do I still have obligations?
Yes. Just because your customer is directing the U.S. forwarder to
ship the items does not relieve you of obligations in the export
transaction. The responsibility for determining the proper export
authorization and obtaining an export license, if necessary, would be
your obligation unless your customer provides you something in writing
indicating that they are assigning the licensing responsibility to
another party in the U.S., such as the forwarder. In either case, you
will continue to show as the “Exporter” on the Shipper’s Export
Declaration. In this case you need to provide specific information to
the forwarder in order for them to do what it takes to ensure
compliance. You will still be cited on the export declaration as U.S.
Principal Party in Interest (USPPI).
I’ve got some paperwork from past exports made before I started here,
can I just use the same information again?
Not necessarily. Export license requirements are transaction
specific. If the item, country of destination, end-user or end-use
have changed, it could affect the type of authorization for which the
export is eligible.
My company has been exporting for years and I’ve never heard of an
ECCN or license requirement. Is this requirement new?
No, this requirement is not new. Perhaps someone in your company
already determined that the items you export are not listed in a
specific ECCN on the Commerce Control List and do not require export
licenses for the destination to which you ship. Be aware that
classifications may change over time. Since the exporter is
responsible for determining the proper authorization for shipment, you
will want to review the Commerce Control List or submit a
classification request.
If you
find there have been exports without proper authorization, you should
notify your company’s management and consider filing a voluntary
disclosure to BIS.
I know the Schedule B number for my item, will that help in
determining the ECCN?
No. The ECCN and Schedule B number do not correlate, although you
will need to know both when you make a shipment.
What is the Schedule B Number and how do I get it?
Schedule B commodity codes are 10-digit numeric codes used to
identify products for trade statistics purposes. The Bureau of
Census’s Foreign Trade Division can assist you at 301-763-2238. A
Schedule B search engine is available at
http://www.census.gov/foreign-trade/schedules/b/.
I’ve been told that I can I get an official ECCN determination over
the phone from the Department of Commerce. Is this true?
No. The ECCN is based on the technical characteristics of the item
and requires a detailed analysis of the item in order for it to be
classified. The Department of Commerce cannot provide you with an ECCN
over the telephone. However, we can assist you in understanding how to
do a self-classification of the item using on-line resources and your
technical understanding of the item. We can also explain the process
of submitting an official request for a classification which typically
takes 4-6 weeks. The Office of Exporter Services has counselors
available from our Washington DC headquarters at (202) 482-4811 and
our Western Regional Office in California at (949) 660-0144 or (408)
351-3378.
I don’t have time to wait for a response to my classification request.
Are there any alternatives to this?
If you are not the manufacturer of the item you are exporting, the
item may have already been classified by the manufacturer if they
themselves export. One of the quickest ways to determine the ECCN of
your item is to check with the manufacturer. Many companies list ECCNs
on their website.
I’ve found an official classification done by the Department of
Commerce back in 1996. Can I still use this?
The Commerce Control List and ECCNs change often - sometimes items
are added to the CCL and other times item specifications are changed
or removed. In addition, your item may have different technical
characteristics than what was classified previously. It’s important to
stay up-to-date with changes to the Commerce Control List which may
affect your item’s classification.
Once I’ve determined my ECCN, what do I do?
Once you have classified the item, the next step is to determine
whether you need an export license based on the “reasons for control”
of the item and the country of ultimate destination.
You
begin this process by comparing the ECCN with the Commerce Country
Chart (Supplement No. 1 to Part 738). The ECCNs and the Commerce
Country Chart, taken together, define the items subject to export
controls based solely on the technical parameters of the item and the
country of ultimate destination.
How do I screen my customer?
Certain individuals and organizations are prohibited from
receiving U.S. exports. Others may only receive goods if the
transaction has been licensed, even for items that do not normally
require a license based on the ECCN and country or based on an EAR99
designation. There are various lists that may be relevant to your
export or reexport transaction such as the Denied Persons List and
Entity List. These lists are available on the BIS website at
http://www.bis.doc.gov/ComplianceAndEnforcement/ListsToCheck.htm.
In
addition, BIS has guidance on its website on knowing your customer and
potential red flags in a transaction at
http://www.bis.doc.gov/complianceandenforcement/KnowYourCustomerGuidance.htm.
What happens if I don’t get the proper export authorization?
Responsibility for export compliance rests with the exporter.
Administrative and criminal penalties exist for violations of U.S.
export law. The maximum financial penalty per administrative violation
is $50,000.
I’m a small businessperson. Does everyone have to follow these
regulations?
Yes. Keep in mind that most low-level or dual-use products will
have the designation EAR99 and be eligible for shipment under the NLR
designation. Products with this designation will only require a
license to certain prohibited destinations, end-users, or end-uses.
If I do have to apply for an export license, can I do it online?
Yes. The fastest way to get an export license is to use the
Internet based electronic licensing system, SNAP. You must first
obtain a PIN prior to submitting an electronic license application or
classification request. For further information regarding SNAP and
PINs, visit the BIS website at
http://www.bis.doc.gov/snap/pinsnaps.htm.
The
alternative is the paper application, the BIS-748P multipurpose
application which is available from BIS. You must use the original
form which must be typed. You can order the form by calling (202)
482-3332.
Is there someone I can call if I have additional questions or need
specific guidance?
Assistance is available. The Office of Exporter Services has
counselors available from our Washington DC headquarters at (202)
482-4811 and our Western Regional Office in California at (949)
660-0144 or (408) 351-3378.
Is there information available on the Internet?
Yes, additional export control information and related resources
are available online at
www.bis.doc.gov.
Useful
Terms:
Automated Export System (AES) record
The electronic equivalent of a Shipper’s Export Declaration.
Bureau of Industry and Security (BIS)
An agency of the Department of Commerce that is responsible for
administering and enforcing export controls on "dual-use" items. BIS
administers the Export Administration Act (EAA) by developing export
control policies, issuing export licenses, prosecuting violators, and
implementing the EAA's antiboycott provisions. BIS also enhances the
defense industrial base, assists U.S. defense firms, and helps other
countries develop export control systems.
Commerce Control List (CCL)
A list of items subject to Bureau of Industry and Security export
license requirements based on their identity. The Commerce Control
List (CCL) is found in Supplement 1 to Part 774 of the Export
Administration Regulations (EAR). [NOTE: EAR99 items are not listed on
the CCL.]
Directorate of Defense Trade Controls (DDTC)
Department of State agency which licenses defense services and defense
(munitions) articles.
Export Control Classification Number (ECCN)
Individual categories of items on the Commerce Control List (CCL) are
identified by an Export Control Classification Number.
Export Administration Regulations (EAR)
Regulations set forth in parts 730-774, of Title 15 of the Code of
Federal Regulations(CFR), and issued by the Department of Commerce to
implement the Export Administration Act (EAA) and other statutory
requirements. The EAR is amended by rules published in the Federal
Register.
No License Required (NLR)
A symbol entered on the Shipper's Export Declaration (SED), certifying
that no BIS export license is required.
Office of Foreign Assets Control (OFAC)
Department of the Treasury office that licenses exports to and other
transactions with certain embargoed countries and sanctioned
individuals and organizations.
Shipper’s
Export Declaration (SED)
A document used by the
Bureau of Census for compiling U.S. trade statistics and by the
Bureau of Industry and Security (BIS) in administering and enforcing
the Export Administration Regulations.
Simplified Network Application Process (SNAP)
A method of submitting applications over the Internet with a web
browser. To use SNAP, one must first apply to BIS for the issuance of
a PIN.
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