1. Export Controls – Classifying Items
NCURA
Regional Spring Meeting
April 27, 2008

2. Laws and Regulations Commerce Department State Department
Treasury Department
Export Administration Act
Arms Export Control Act
Trading with the Enemy Act, Int’l Emergency Economic Powers Act, & Others
Export Administration Regulations (“EAR”)
15 C.F.R. Parts
International Traffic in Arms Regulations (“ITAR”)
22 C.F.R. Parts
Iraq Sanctions Regulations, Terrorism Sanctions Regulations, & Others
31 C.F.R. Parts
Commerce Control List
15CFR Part 774
U.S. Munitions List
22 CFR Part 121
List of Specially Designated Nationals & Blocked Persons
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3. Commerce Control List (CCL) Categories under the EAR
5 = Telecommunications and Information Security
6 = Lasers and Sensors
7 = Navigation and Avionics
8 = Marine
9 = Propulsion Systems, Space Vehicles and Related Equipment
0 = Nuclear Materials, Facilities and Equipment and Misc.
1 = Materials, Chemicals, Microorganisms and Toxins
2 = Materials Processing
3 = Electronics
4 = Computers
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4. CCL – Five Product Groups
Within each category, items are arranged by group. Each category contains the same five groups. Each Group is identified by the letters A through E, as follows:
A – Systems, Equipment and Components
B - Test, Inspection and Production Equipment
C - Materials
D - Software
E - Technology
(Specific information necessary for the ‘development’, ‘production’, or ‘use’ of a product, including ‘technical data’ or ‘technical assistance’. ‘Technical data’ may take forms such as blueprints, plans, diagrams, models, formulae, tables, engineering designs and specifications, manuals and instructions.)
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5. Export Control Classification Numbers (ECCNs)
Category
Group
Item
3A001 – “Electronics components, as follows (see List of Items Controlled)”
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6. Examples of Items Covered by Category 3 - Electronics
GROUP A: Systems, Equipment, and Components
3A001 examples:
Microprocessor microcircuits, micro-computer microcircuits, and microcontroller microcircuits manufactured from a compound semiconductor and operating at a clock frequency exceeding 40MHz; or
storage integrated circuits manufactured from a compound semiconductor; or
Microwave integrated circuits or modules having all of the following: containing ‘monolithic integrated circuits’ having one or more active circuit elements, and operating at frequencies above 3GHz
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7. Examples of Items Covered by Category 3 - Electronics
GROUP B: Test, Inspection and Production Equipment (3B001)
Equipment for the manufacturing of semiconductor devices or materials and specially designed components and accessories therefor.
Equipment designed for epitaxial growth capable of producing a layer thickness uniform to less than +/-2.5% across a distance of 75 mm or more
Molecular beam epitaxial growth equipment using gas or solid sources
Equipment design for ion implantation, having any of the following
A beam energy (accelerating voltage) exceeding 1MeV; or
Being specially designed and optimized to operate at a beam energy (accelerating voltage) of less than 2keV; or
Direct write capability; or
A beam energy of 65keV or more and a beam current of 45 mA or more for high energy oxygen implant into a heated semiconductor material substrate
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8. Examples of Items Covered by Category 3 - Electronics
GROUP C: Materials
Hetero-epitaxial materials consisting of a ‘substrate’ having stacked epitaxially grown multiple layers of any of the following:
Silicon
Germanium
Silicon Carbide, or
III/V compounds of gallium or indium
Resist material and ‘substrates’ coated with controlled resists:
Positive resists designed for semiconductor lithography specially adjusted for use at wavelengths below 350 nm;
All resists designed for use with electron or ion beams with a sensitivity of 0.01 ucoulomb/mm2 or better;
All resists designed for use with X-rays, with a sensitivity of 2.5mJ/mm2 or better;
All resists optimized for surface imaging technologies, including silylated resists.
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9. Examples of Items Covered by Category 3 - Electronics
GROUP D: Software
Software specially designed for the ‘development’ or ‘production’ of equipment controlled by 3A001.b to 3A002.g or 3B (except 3B991 or 3B992)
Software specially designed for the ‘use’ of ‘stored program controlled’ equipment controlled by 3B (except 3B991 & 992)
Computer-aided-design (CAD) software , having all of the following
Designed for the ‘development’ of semiconductor devices or integrated circuits, and
Designed to perform or use any of the folllowing
Design rules or circuit verification rules;
Simulation of the physically laid out circuits; or
Lithographic processing simulators for design.
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10. Examples of Items Covered by Category 3 - Electronics
GROUP E: Technology
‘Technology’ for the ‘development’ or ‘production’ of equipment or materials controlled by 3A (except 3A292, 3A980, 3A981, 3A991 or 3A992), 3B (except 3B991 or 3B992) or 3C
‘Technology’ for the ‘development’ or ‘production’ of ‘microprocessor microcircuits’, ‘microcomputer microcircuits’ and microcontroller microcircuits having a ‘composite theoretical performance’ (‘CTP’) of 530 million theoretical operations per second (MTOPS) or more and an arithmetic logic unit with an access width of 32 bits or more
‘Technology’ for the ‘use’ of equipment or ‘software’ controlled by 3A001.a.1 or .2, 3A101, or 3D101
‘Technology’ for the ‘development’ of ‘software’ controlled by 3D101
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11. Examples of Items Covered by Category 1 Materials, Chem, Microorganisms, & Toxins
Systems, Equip
& Components
Chemical Agents, including tear gas containing 1% or less of CS or CN, except containers net wt <20gm
Test, Inspection, & Prod. Equip.
Electrolytic cells for fluorine production with a production capacity >250 g of fluorine per hour
Materials
Chemical precursors for toxic chemical agents (1C350) (sodium bifluoride); human pathogens, zoonoses, and “toxins” (1C351) (Rickettsia rickettsii, Chlamydia psittaci); animal pathogens (1C352) (goat pox virus); plant pathogens (1C354)
Software
“Software” for process control that is specifically configured to control or initiate “production” of chemicals controlled by 1C350
Technology
Technical data for the development of production of any of the above items
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12. Using the Commerce Control List
A good explanation of the structure of the CCL, how to read the ECCNs, and how to determine if an export license is required is found in Part A good ‘diagram’ of the process is found in Part 732, Supplements 1 & 2
Start by finding the commodity on the CCL. Note the ECCN number and check the “reason for control” at the beginning of each entry, under License Requirements
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13. Using the Commerce Control List – Reason for Listing
NS: National Security
RS: Regional Stability
SS: Short Supply
UN: United Nations Embargo
SI: Significant Items
SL: Surreptitious Listening
AT: Anti-Terrorism
CB: Chemical & Biological Weapons
CC: Crime Control
CW: Chemical Weapons Convention
EI: Encryption Items
FC: Firearms Convention
MT: Missile Technology
NP: Nuclear Non-Proliferation
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14. Using the Commerce Control List
Check the country list at EAR Part 738, Supplement 1
Determine whether country to which item will be shipped has check (X) under the applicable ‘reason for control’ column
If no (X), ship item as “NLR” (No License Required). See EAR Parts 758 and 762 for export clearance procedures and recordkeeping requirements for NLRs.
If box is checked for the country under the applicable ‘reason for control’ column, then a license may be required.
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15. Using the Commerce Control List
Check “License Exceptions” heading that appears after the “License Requirements” section for the ECCN. See EAR Part 740 for all license exceptions. Some commonly used ones are:
LVS: Limited Value Shipment (Part 740.3)
CIV: Civil End-Users (Part 740.5)
TSR: Technology & Software under Restriction (Part 740.6)
CTP: Computers (Part 740.7)
TMP: Temporary Imports, Exports, & Reexports (Part 740.9) (See Tools of Trade for personal use abroad, at 740.9(a)(2)(i) and ‘Beta Software’ at 740.9(c))
TSU: Technology and Software Unrestricted (Part )(See publicly available encryption source/object code at (e) and(f))
BAG: Baggage (Part )
ENC: Encryption Commodities and Software (Part )
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16. Using the Commerce Control List
If no license exception applicable, apply for license using BIS-748P or SNAP-R
Note: Many ECCNs have more than one “reason for control”. Each reason must be checked on the country chart before concluding No License Required (NLR)
Note: Each license exception has specific criteria that must be met to qualify for the license exception. Also, many license exceptions require special record-keeping and some require notification to the government of use of the license exception. See especially the notification requirements described in EAR Part (b)(1) and (b)(2) for certain encryption items controlled under ECCNs 5A992, 5D992, and 5E992.
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17. Using the Commerce Control List
Note: In addition to checking the “Reason for Control”/Country Chart, as well as the “License Exceptions”, there are General Prohibitions listed in EAR Part Whether the shipment will be subject to one of these prohibitions depends upon: 1) the ECCN classification of the item; 2) the destination; 3)the end-user; 4) the end-use; and 5) conduct. Prohibitions 4-10 are:
Denial Order issued under EAR Part 766
Export to prohibited end-uses or end-users under EAR Part 744
Export to embargoed destination described in EAR Part 746
Support of Proliferation Activities described in EAR Part 744
Intransit Shipments through specified countries listed in EAR Part 736(b)(8)(ii)
Violation of terms and conditions of an exception or license
Proceeding with knowledge that a violation has or is about to occur
Practical tip: start by screening the end user. If the end user can’t receive the shipment, there’s no point in classifying the item.
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18. Using the Commerce Control List
If the commodity does not appear on the CCL, then the item is shipped under category EAR99, NLR (unless Prohibitions 4 through 10 apply).
If you have trouble locating the Section of the CCL that includes the commodity you are looking for, try the alphabetical listing of all items on the CCL found at EAR Part 774, Supplement 1, and then work backwards to the ECCN
Search for items by both the common name and scientific name. Consult with the faculty member. If you conclude the item is not included in the CCL, write a note to the file documenting the search conducted.
If you aren’t sure, you can contact your BIS regional office or request a Commodity Classification (See Part 748.3)
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19. Example: Classifying a piece of equipment under the EAR
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20. A faculty member in your Criminal Justice department is working with a colleague at the University of Iceland in Reykjavik who is testing the scientific validity of polygraph measurements. He wants to ship a U.S. polygraph to his colleague.
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21. Example: Shipment of Polygraph (Basic Steps)
Step 1 - Classification of item. Start by looking in the Commerce Control List under the category of electronics (Category 3) and product group which covers equipment (Product Group A). Then read through the list to find whether your item is included in the list. The ECCN for polygraphs is 3A981.
Step 2 – License requirements. These list the reason that the item is controlled. Polygraphs are controlled for “CC”, or crime control.
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22. Example: Shipment of Polygraph (Basic Steps)
Step 3 – Destination Country. Check whether a license is required for the country.
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23. Example: Shipment of Polygraph (Basic Steps)
Step 4 – Screening. Certain individuals and organizations are prohibited from receiving U.S. exports.
Entity List – BIS list of organizations identified as engaging in activities related to the proliferation of WMD.
Specially Designated Nationals and Blocked Persons List – OFAC list of individuals and organizations representing restricted countries or known to be involved in terrorism or narcotics trafficking.
Unverified List – BIS list of firms for which it was unable to complete an end-use check.
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24. ITAR - U.S. Munitions List
I - Firearms
II - Artillery Projectors
III - Ammunition
IV - Launch Vehicles, etc...
V - Explosives, Propellants, Incendiary Agents and Their Constituents
VI - Vessels of War and Special Naval Equipment
VII - Tanks and Military Vehicles
VIII - Aircraft and Associated Equipment
IX - Military Training Equipment
X - Protective Personnel Equipment
XI - Military Electronics
XII - Fire Control, Range Finder, Optical and Guidance and Control Equipment
XIII - Auxiliary Military Equipment
XIV - Toxicological Agents and Equipment and Radiological Equipment
XV - Spacecraft Systems and Associated Equipment
XVI - Nuclear Weapons Design and Related Equipment
XVII - Classified Articles, Technical Data and Defense Services Not Otherwise Enumerated
XVIII - Reserved
XIX - Reserved
XX - Submersible Vessels, Oceanographic and Associated Equipment
XXI - Miscellaneous Articles
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25. ITAR – U.S. Munitions List
The list of items controlled under ITAR is more straightforward and is only 40 pages long. There are no subdivisions within categories.
Some of the items listed are broadly defined, such as those included in Category XV, Spacecraft Systems and Associated Equipment:
a) Spacecraft, including . . scientific satellites, research satellites, etc.
b) Ground control stations for telemetry, tracking and control of spacecraft or satellites
c) All specifically designed or modified systems, components, parts, accessories, attachments, and associated equipment for articles in this category
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26. ITAR – U.S. Munitions List
Many of the other broad category items are qualified with the phrase “specifically designed or modified for military application”
There is no ‘country chart’ or categories of ‘license exception’; if the article is on the list, you will need to secure a license for permanent or temporary export or temporary import of the item.
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27. EXERCISES
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28. Do’s and Don’ts
Do NOT ship any item outside the U.S. without first checking the ITAR and EAR Lists to determine if the item is controlled (This includes outgoing MTA’s, software licenses, and any agreement deliverables)
Secure license approval or verify license exception PRIOR to Shipment for all controlled items
Make sure that technical data about export controlled commodities in in “public domain” (ITAR term) or qualifies as “publicly available” (EAR term), so that a license for shipment of technical data out of the U.S. is not required and that the ‘deemed export’ rule to a foreign national in the U.S. does not apply.
Qualify software as ‘publicly available’, or otherwise secure licenses prior to shipment if the software is on CCL or USML
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29. QUESTIONS?
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