An English Solicitor & Israeli Lawyer Serving Corporate & Commercial Clients in Both Jurisdictions

U.S. Export Controls

U.S. Export Controls

All U.S. origin goods, certain technology and certain technical services are controlled for export from the U.S. The U.S. export control laws also impose restrictions on the non-U.S. recipients with respect to re-exporting the controlled goods and technology to other countries, retransfers within the same countries and changes in end-use.

The U.S. International Traffic in Arms Regulations (ITAR) promulgated under the U.S. Arms Export Control Act (AECA) controls the goods and technology intended solely for military use and certain space technologies. Almost all other goods and technologies are controlled by the U.S. Export Administration Regulations (EAR) promulgated under the Export Administration Act (EAA).

The ITAR is the more stringent set of regulations. It contains the U.S. Munitions List (USML) which lists all of the goods – named “defense articles” and related technical data that are controlled by the ITAR. The ITAR is administered by the Directorate of Defense Trade Controls (DDTC) of the State Department. Almost all exports from the U.S. of ITAR controlled defense articles and technical data and retransfers and re-exports among non-U.S. parties, require export licenses or other appropriate approvals from DDTC, though there are some exceptions to licenses available in limited cases and most time only to the U.S. exporter. Certain technical assistance provided by U.S. persons to non-U.S. persons in connection with defense articles, known as defense services, are also controlled and require prior DDTC approval.

The EAR is administered by the Bureau of Industry and Security (BIS) of the Department of Commerce. Generally, BIS is the export licensing authority for all EAR controlled goods and technology, although the Nuclear Regulatory Commission of the Department of Energy is the licensing authority for certain nuclear related goods and technology and exports to certain embargoed destinations and sanctioned entities require the prior approval of the Office of Foreign Assets Control (OFAC) of the Treasury Department.

Goods and technology controlled by the EAR are either contained under an Export Control Classification Number (ECCN) in the Commerce Control List (CCL) or fall under a residuary category known as EAR99. Generally, items falling under EAR99 are the items requiring the least controls for export purposes and include simple civilian items.

The EAR is a much more flexible regime than the ITAR due to the fact it controls both items requiring a degree of stringent control and items considered far more benign and requiring very few export restrictions. Whether or not an export license is required from BIS for the export of a commodity or technology controlled by the EAR depends on a number of factors, such as under which ECCN the item falls, what is the intended destination of the item, what is the intended end-use of the item and who are the intended consignees and end-users of the items.  Generally, items classed as EAR99 do not require export approvals except for in very limited circumstances for exports intended for embargoed countries or certain sanctioned entities.

As with the ITAR, the EAR imposes restrictions on non-U.S. recipients retransfer or re-export of EAR controlled commodities and technologies. However, while the ITAR’s requirements drill down into individual components and technology, thereby continuing to apply to non-U.S. made higher end products and systems if those systems contain even a single ITAR controlled component or technology, the EAR has a de minimis principal which releases many non-U.S. made products and systems from further control under the EAR if they do not contain U.S. origin content above certain thresholds of sale value compared to the sale value of the overall non-U.S. product or system.

U.S. export control laws seek to implement various international agreements and arrangements to which the U.S. is a signatory, particularly:

  • The Missile Technology Control Regime (MTCR) – an informal and voluntary partnership among 35 countries to prevent the proliferation of missiles and missile technology (including unmanned aerial vehicles)
  • The  Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies – a regime made up of 41 countries promoting greater transparency in the trade of military and dual use goods and technology.
  • The Nuclear Suppliers Group – a group of 48 nuclear supplier countries that seek to prevent nuclear proliferation by controlling the export of materials, equipment and technology that can be used to manufacture nuclear weapons.
  • The Australia Group – an informal regime of 42 countries aimed at controlling the proliferation of chemical and biological weapons

The U.S. export control regime can be quite complicated and confusing, even to U.S. exporters and advisers. Violations of the rules can result in criminal prosecutions, heavy fines, gaol terms in the worst cases, being black listed for further exports, closer scrutiny by the U.S. Government, a damaged reputation amongst U.S. partners and time and money dealing with costly U.S. Government investigations. The arms of the U.S. Government are long as far as U.S. export controls go and DDTC, BIS and OFAC regularly bring investigations and prosecutions against non-U.S. parties based outside of the U.S. for violations of U.S. export controls, sometimes resulting in sever penalties.


How Gil Rosen Law Can Help Your Non-U.S. Business in Connection U.S. Export Controls

I am very experienced in advising non-U.S. based businesses on compliance with the ITAR and the EAR. My work includes:

  • Determining whether parts, components, software, products and technology that clients purchase from the U.S. are ITAR or EAR controlled and if EAR controlled, under which ECCN they fall
  • Determining whether client products and technology developed and produced outside the U.S., containing U.S. content are ITAR or EAR controlled
  • Devising for clients specially tailor made corporate compliance programs and procedures for personnel to follow in order to reduce the likelihood of violations of U.S. export control laws according to the risk factors associated with the specific businesses
  • Providing training programs in U.S. export control compliance for personnel
  • Advising clients on the information that must be provided to the U.S. exporters in order for the U.S. exporters to apply for suitable licenses
  • Advising and negotiating on the contents of special forms of ITAR licenses called:
    • Technical Assistance Agreements (TAA)
    • Manufacturing License Agreements (MLA)
    • Warehouse and Distribution Agreements (WDA).
  • Advising clients in resolving U.S. export violations, including with the preparation of voluntary disclosures related to violations
  • In connection with investments in U.S. company’s and in non-U.S. companies involved in ITAR or EAR controlled goods and technology, I perform audits of the target company’s U.S. export control compliance history in due diligence exercises.

Case Studies

  • A client of mine is a local subsidiary of a large international defence contractor. The parent company was charged by DDTC for numerous ITAR violations and had sever fines imposed on it and many of its export privileges were revoked or suspended. As part of its rectification process, the parent company was required to ensure that all of its subsidiaries around the world audited their ITAR compliance processes and adopt suitable compliance procedures. I was retained by the subsidiary to perform an audit on its ITAR compliance history and to help it to adopt a suitable ITAR compliance program. After completing the work, U.S. officials visited the subsidiary to examine its new compliance procedures and processes. The subsidiary passed the examination with flying colours and the parent company even requested my permission to allow it to use the procedures that I had drafted for the subsidiary as a basis for suitable procedures for all of its other subsidiaries around the world.
  • I have worked very closely with a client that is a large business engaged in the production of certain parts for firearms. The business is not based in the U.S. and the business’ core products were not developed or produced in the U.S. However, the business does purchase certain parts and components from the U.S. that are either ITAR controlled or EAR controlled and that are incorporated into its products. It was decided to perform a suitable risk assessment and then devise corporate wide U.S. export control compliance procedures and a training program. I worked with the business’ management and legal team over a period of time to form the most appropriate corporate wide U.S. export control procedures and then provided all relevant personnel with a suitable training to ensure that the procedures are properly followed.

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Reviews

  • We have had a pleasure working Gil Rosen on a number of issues recently. We were very impressed with the service, which, we would describe, as on time, professional & simple to understand.

    Nazar Chynybekov – Digital Dental Services Ltd.
  • “Admati Agencies uses Gil Rosen Law’s for his niche expertise on U.S. export control law. Gil provides a highly professional business oriented legal service and we are happy to recommend his services.”

    Udi Admati, CEO -
    Admati Agencies
  • Gil Rosen has advised me in connection with my investments in a couple of start-up companies and has continued to advise me in connection with my rights as a shareholder and also my responsibilities as a director in one of the companies. Gil is a hard and fast worker. He provides meaningful practical business advice and he is a good negotiator. I am happy to recommend the services of Gil Rosen Law.

    Alexander Yablonskiy
  • Gil Rosen advised me on a two separate topics that both needed to be resolved within a tight time frame and at almost the same time. Despite the difficult conditions, Gil provided an excellent and professional service, provided clear, practical advice that he efficiently executed and helped to ensure that both transactions concluded successfully. I’d happily recommend Gil Rosen Law’s services

    Oleg Erlich
  • “Plataine uses Gil Rosen Law’s services for advice concerning U.S. export law as and when required. We find Gil highly professional, responsive and reliable. We are happy to recommend Gil Rosen Law to others.”

    Avner Ben Bassat, CEO -
    Plataine
  • “Gil Rosen has provided SpaceIL with his legal services on a pro bono basis for over 2 years. We at SpaceIL find Gil Rosen to be highly professional. His advice is practical and put across in a manner that makes a complicated topic much easier to follow and digest. We are grateful for the dedication that Gil has shown to us and we are happy to recommend his services.”

    Google Lunar Xprize, Official Team -
    Spaceil
  • Gil Rosen, although we knew each other for a short period I would like to thank you for your great investment and time following mWaverequirments. I must say you gave us a very efficient service and didn’t gave up till we finalize with good results covering all relevant points. Your explanation and your availability gave me the confidence and make me trust you 100%. I’m sure this service is not just for me and you give the same treatment to all of your customers. Again thank you very much for this VIP service. I’m sure we will keep on the good work for the long run.

    Amir Bengio, CEO -
    mWave Dynamics ltd
  • Lya Hydraulic Engineering Ltd. received a new request from a client that was new to us, involving the use of U.S. Foreign Military Funding. As this is an area that was unfamiliar to us and because it is a complicated and confusing subject, we looked for somebody to help us who is knowledgeable and experienced in the field, somebody trustworthy who can guide us on the subject. As a result of our search, we found Gil Rosen Law and decided to retain Gil Rosen’s services.
    During the on-going work, we found that Gil Rosen has a deep understanding of the field, is pleasant and patient. Gil helped us to formulate a suitable strategy for our requirements and he was even proactive in communications with potential U.S. suppliers in order to help us reach agreements to enable us to move forward on the project.
    To Summarise, I wholly recommend Gil Rosen.

    Rafael Schechter, CEO -
    Lya Hydraulic Engineering Ltd.
  • “Gil has proven to be a loyal advisor, a true business partner with superb work relations and achievements…..Gil has been a partner to my efforts in negotiating various types of commercial agreements and regulatory activities such as those of Export Control Regulations (mostly US Government but worldwide regimes as well) and Acquisition Regulations of various governments (mostly US Government FAR/DFARs but other European, South American and others as well).Gil’s ability to provide advice in a vast array of fields of activity, relating to business and legal efforts is one I can’t compare to any other I’ve worked with. Gil has astonished me numerous times, in his ability to review high level requirements, extensive amounts of material in short to zero time, while extracting the risks and mitigating them cleverly. His stunning ability to review mounds of documents and provide crisp, thorough and sharp review and comments for consideration while covering so many scopes of requirements is one that I have never seen with any other legal or other advisor I’ve ever worked with. Gil has a unique ability to provide advice not only as an attorney, but also as a business person. This quality has proven to be of great value for me in the business arena I work at as learning to identify the true needs of partners and competitors can be the most important when negotiating business. I wholeheartedly recommend Gil Rosen as a legal service provider and am certain any person will benefit from his advice and services.”

    Galia Barak, Contracts Manager -
    PlasanSasa Ltd.
  • “I’ve been working with Gil for the last 6 years of my career in Plasan. With no doubt, I can tell that whoever works with Gil, will find a very talented lawyer and extremely smart and creative team player. Unlike those contract managers who always tell you why you cannot, Gil is the person who finds the way to tell you how you can, under the legal and contractual limitations. With his demonstrated responsibility and responsiveness, Gil was deeply involved in negotiations with our customers and suppliers and always performed. Gil has a very pleasant personality, he knows very well how to explain his professional perspective and is a pleasure person to work with.”

    EldarAharonovich, Business Leader -
    Plasan North America, Inc.
  • North East Technologies LTD is an International marketing group specializes in the fields of defense and HLS products worldwide. As a company extensively involved in these unique fields of activities, we very much appreciate the cooperation with Gil Rosen Law office. I have personally known Mr. Gil Rosen for many years and when I learned that he would like to establish his own legal practice, we immediately elected Mr. Rosen to be our legal consultant which will support us with our various legal and contractual issues. Mr. Rosen is very knowledgeable and thorough in his work. He is an expert in the areas of defense and homeland security matters. He is also significantly assisting NET’s team with all outstanding matters concerning regulation and compliance as well as he is very efficient in constructing commercial agreements. We are very pleased with our teamwork with Gil Rosen Law office and hope to continue our constructive collaboration in the future.

    Yehuda Amon, President and CEO -
    North East Technologies LTD
  • Gil has advised Meprolight for over 3 years in connection with U.S. export controls. We are an Israeli manufacturer of electro optics systems and products for military and civilian markets. This is a highly regulated industry and we often purchase parts and components from the U.S. that have re-export and use limitations. Gil provides us with clear and practical advice. Gil is a lawyer that is more concerned with helping us find viable solutions rather than simply telling us what cannot be done. He provides a very professional service and I am pleased to recommend Gil Rosen

    Assaf Shimron CFO
    Meprolight (1990) Ltd.
  • Gil is a professional with a deep knowledge of business law and organizational fronts and holds a deep passion for his job, whom I first met at Plasan in 2009. Gil is a reliable and true partner for sharing most delicate business sensitivities and is also a strategic thinker, a force to be reckoned with (in a positive way)! Particularly his knowledge and experience in international business, contract negotiations, ITAR and EAR should be emphasized. Gil’s support to ‘End To End Systems’ has been a real asset to us.

    Ami Harel, CEO -
    End to End Systems
  • Israel Weapon Industries (IWI) Ltd. has been using Gil Rosen’s services for a number of years, mostly for advice on U.S. export control laws and occasionally for defense related commercial work. We have enjoyed a very good relationship with Gil throughout this time. He provides a very good service. He is smart, responsive, works quickly and efficiently and provides practical solutions to tricky legal hurdles. We are happy to recommend Gil Rosen Law.

    Boaz Tal – Vice President. General Counsel

Why Choose Gil Rosen Law?

  • I provide high quality corporate and commercial advice that is tailored to your specific business needs.
  • I believe that the best approach is the simplest and most practical approach.
  • I have over 15 years post-qualified experience working with a vast range of businesses, industries and sectors. I will put that valuable experience to use for your benefit.
  • I will understand what is important to you, I will understand your business aims and help you to achieve them.
  • I believe in personal and long lasting relationships with the people and businesses that instruct me and I am committed to going above and beyond to keep you satisfied.