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A Customs Broker’s Observations on Exports A basic tenet of exporting that most people are unaware of is that exporting is a privilege not a right, and that virtually all exports are controlled by the U.S. Government. One of the most surprising things I notice as I begin discussions on how a company can export their goods is that rarely does the company even have a copy of the pertinent export regulations in their possession…or realize that there are export regulations. It seems that many companies and certainly key individuals within them are totally unaware that virtually all exports are controlled by the U.S. Government. Those of us “in the know” by virtue of working in the defense arena (my case), by having worked with multi-national companies in the commercial marketplace or those that may have unfortunately fallen afoul of a Customs audit are very well aware that exporting products is a very regulated exercise. Briefly, there are two general groupings of products in the export market. These are, in order of regulatory complexity, 1) defense products and services which fall under the purview of the Department of State, and 2) commercial products and services which are managed by the Department of Commerce. (The Department of Treasury and its Office of Foreign Assets Control (OFAC) manage certain issues but will not be discussed here). The Department of State issues its control regulations entitled the “International Traffic in Arms Regulations” or ITAR as they are commonly known, while the Department of Commerce through its Bureau of Industry and Security issues the Export Administration Regulations (EAR) which cover virtually everything not covered by the ITAR. If you, as an exporter or prospective exporter do not have the relevant regulations to guide you in your export functions, you are placing yourself and your company in potential jeopardy with US Customs, and certainly your customers in other countries. Customs regularly seizes products destined for other countries for documentation errors, or for lack of proper documentation. Fines and penalties are normal and regular outcomes of these seizures at one end while repeated problems can easily result in major fines, civil and criminal penalties and restrictions on the company’s ability to export its products at the other end. The impact on a company can be devastating. If you are intending to export your products you must research the issue thoroughly, acquire the necessary regulations, learn them and how they apply to your products and proceed with studious caution. Defense product exporters must be registered with the State Department before they can export. In addition, their products must be exported under a specific export license (unless exempt under certain terms). Certain commercial products may also be subject to Commerce Department export license control. Both foreign countries and foreign customers must be reviewed to determine if it is legal to ship to them. Many products are restricted to some countries while not restricted to others. Export documentation for both defense and commercial articles are subject to scrutiny and must be accurate and complete. Remember, as the exporter of record, you have the ultimate responsibility for the export transaction. These points are but a very few of the things that you, as an exporter of United States technology, must be aware of and become familiar with in order to protect yourself and your company from export management and control problems. For more tips on avoiding customs trouble and the full range of export/import services a customs broker can provide visit http://www.acustomsbroker.com. James R. Loux Allegheny Brokerage Company, Inc. jloux@acustomsbroker.com