Foreign Export Licenses Screening

Foreign licensees/sub-licensees must ask questions of any third country/dual national employee involved in any ITAR program to adequately evaluate if the employee undertakes activities that pose a risk of diversion, such as:

Regular travel to ITAR 126.1 proscribed countries;
Recent or continuing contact with agents, brokers, and nationals of such countries including government officials;
Continued demonstrated allegiance to such countries such as being a member of the military forces;
Maintenance of business relationships with persons from such countries;
Maintenance of a residence in such countries;
Family contacts in a prohibited destination, where family members are connected to the prohibited destination government
Receiving salary or other continuing monetary compensation from such countries.

Once adequately screened, all screened employees assigned to ITAR programs must complete an ITAR Non- Disclosure Agreement prior to being granted access to any ITAR controlled technical data or hardware.

Lastly, the foreign licensee must have in place effective procedures e.g. Technology Control Plans, to prevent diversion to destinations, entities or purposes not authorized by the applicable ITAR license or agreement or other ITAR authorization to ensure compliance with the ITAR.

Export Control Reform

Beginning October 15, 2013, Export Control Reform has transferred certain categories of items on the US Munitions List and related technical data to the EAR’s Commerce Control List (CCL) under the so-called 600 series and 515 series Export Control Classification Numbers (ECCNS). On October 31, 2013 the Department of Commerce released a policy statement to permit foreign licensees that receive any 600/515 series hardware and technology to avail themselves of the same procedures and authorizations allowed by ITAR 126.18, when allowing any third- country/dual national employees to have access to ECCN 600/515 series data or hardware. The Department of Commerce also requires the same screening protocols by the foreign parties.

Should I ask my foreign customers about employees used on my ITAR or EAR 600/515 series programs?

The provisions of the ITAR no longer require you to ask your foreign partners about their employee base. However, as in any export compliance situation, be it related to an ITAR Technical Assistance Agreement or a Department of Commerce, Bureau of Industry and Security (BIS) license, you should make sure that your foreign licensee understands fully the nuances and requirements of the provisions of ITAR § 126.18. We recommend wherever possible, this type of information be discussed in detail and followed up in writing with your foreign licensee(s).

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