Demystifying US Export Control Regulations for Dual-Use Technologies
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The document provides an overview of U.S. export control regulations, specifically focusing on dual-use technologies and their implications for U.K. companies and universities engaged in R&D partnerships. It outlines key regulatory frameworks, including the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations (EAR), and discusses the fundamental research exception in relation to export controls. The agenda includes presentations from various experts highlighting the importance of compliance and navigating export controls for transatlantic collaboration.
Demystifying US Export Control Regulations for Dual-Use Technologies
- 2. www.ktn-uk.org Dr Sandeep Sandhu Head of Stakeholder Relationships sandeep.sandhu@ktn-uk.org Demystifying US Export Control Regulations for Dual - Use Technologies
- 3. 16:00 – Welcome & Introduction | Sandeep Sandhu, KTN, Karla Hagan, UK Science and Innovation Network 16:10 – Opening Remarks | Joe White MBE, UK Tech Envoy to the US and San Francisco Consul General 16:20 – Findings from USA Export Control Regulations Report | Ron Oleynik and Antonia Tzinova, Holland & Knight 16:40 – Questions and fireside chat with Holland & Knight by Nick Hooper, UK Science and Innovation Network 17.00 – Q&A from the audience | Nick Hooper, UK Science and Innovation Network 17:25 – Conclusions & Wrap-up | Nick Hooper, UK Science and Innovation Network Agenda
- 4. KTN exists to connect innovators with new partners and new opportunities beyond their existing thinking – accelerating ambitious ideas into real-world solutions.
- 6. ©KTN All rights reserved | www.ktn-uk.org Dr Sandeep Sandhu Head of Stakeholder Relationships sandeep.sandhu@ktn-uk.org Thank you
- 7. Copyright © 2021 Holland & Knight LLP. All Rights Reserved U.S. EXPORT CONTROLS: A GUIDE FOR U.K. COMPANIES AND UNIVERSITIES INTERESTED IN PARTNERING WITH THE U.S. IN R&D Ronald A. Oleynik | Antonia Tzinova | Dariya Golubkova June 8, 2021
- 8. Outline U.S. Export Controls: Regulators, Regulations, Controls ITAR versus EAR “Technology” “Deemed” Exports University Research and Export Controls Fundamental Research Exception 2
- 9. U.S. and UK Export Controls » Both parties to the Wassenaar Arrangement − U.S. bi-furcated controls ˗ U.S. Munitions List (ITAR) tracks the Wassenaar Arrangement Munitions List ˗ Commerce Control List (EAR) tracks the Wassenaar Dual-Use Goods and Technologies − U.K. Strategic Export Control Lists: The Consolidated List of Strategic Military and Dual-use Items that Require Export Authorisation from Great Britain and Northern Ireland » U.S. unilateral controls − goods and technologies not on the Wassenaar Lists − national security; foreign policy; or other strategic reason − U.S. will try to negotiate with its partners post-designation 3
- 10. U.S. Regulators, Regulations, Controls 4 Regulator Regulations Controls Defense Exports DDTC Directorate of Defense Trade Controls Department of State ITAR International Traffic in Arms Regulation, 22 C.F.R. Parts 120-130 USML (U.S. Munitions List) Commercial Exports BIS Bureau of Industry and Services Department of Commerce EAR Export Administration Regulations, 15 C.F.R. Parts 730-774 CCL (Commerce Control List) EAR99 Economic Sanctions OFAC Department of Treasury Office of Foreign Assets Control Executive Orders OFAC Regulations, 31 C.F.R. Parts 500-599 UN Sanctions SDN List / Embargoes (Sanctioned Persons / Destinations)
- 11. ITAR versus EAR 5 ITAR EAR Responsible Agency Department of State (DDTC) Department of Commerce (BIS) Controlled Items • defense articles • defense services • technical data • civilian and dual-use goods and technologies • Military technology moved from USML to CCL Controlled Actions • export, reexport, and transfer (in-country) • temporary import • brokering activities • export, reexport, and transfer (in-country) • temporary import In Rem Jurisdiction “See-through Rule” • ITAR-controlled content triggers ITAR jurisdiction over entire item “Black Box” Treatment • Overall function of item • Exception: de minimis U.S. content for certain technologies Destination Controls all defense articles are controlled, no matter the foreign country of destination export control depends on destination and reason for control License Exceptions Various exemptions and exceptions, but ITAR registration required as a prerequisite Various exceptions, no registration required Registration required not required License Applications filed through DECCS online portal filed through SNAP-R online portal
- 12. “Technology” » Definition − EAR • “Technology” is the information necessary for the “development”; “production”; “use”; operation; installation; maintenance; repair; overhaul; or refurbishing of a controlled item. • Controls may vary based on how the “technology” is utilized (e.g., technology necessary to “use” a commodity versus technology necessary to “design” or “produce” a commodity) • Certain “published” unclassified “technology” is not subject to the EAR. − ITAR • “technical data” – Information, . . . , which is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles. This includes information in the form of blueprints, drawings, photographs, plans, instructions or documentation • “defense services” 1) The furnishing of assistance (including training) to foreign persons, whether in the U.S. or abroad, in the design, development, engineering, manufacture, production, assembly, testing, repair, maintenance, modification, operation, demilitarization, destruction, processing or use of defense articles; 2) The furnishing to foreign persons of any technical data controlled under this subchapter (see §120.10), whether in the United States or abroad; » Emerging and foundational technologies (Export Control Reform Act of 2018) − New series of emerging technologies added to the CCL 6
- 13. “Deemed” Exports The transfer of controlled information to a non-U.S. person − Can occur within the United States − Can happen through a demonstration, oral briefing, or a lab visit; in an email; or by posting to a company’s or university’s internal or external website. − Standard for determining whether research undertaken at a U.S. company or university delivers the kind of knowledge the U.S. government considers crucial for U.S. national security and, as such, warrants control. 7
- 14. University Research and Export Controls 8 − General Educational Information – outside the scope of export controls • instruction in catalogue courses and associated teaching laboratories of academic institutions • information concerning general scientific, mathematical, or engineering principles commonly taught in schools, colleges, and universities − Publicly Available Information • published information, i.e., information that has been made public, without any further restrictions on further dissemination • Through subscriptions, libraries, trade shows, public dissemination − Results of Fundamental Research • research in the science, math, and engineering fields, that is ordinarily published and broadly shared, and that is not restricted for any national security or proprietary reasons
- 15. Fundamental Research Exception 9 From a research project perspective, it is essential to distinguish the information or product that results from the fundamental research from the conduct that occurs within the context of the fundamental research. Results of the fundamental research are not subject to export controls. However, an export license may be required if, during the conduct of the research, export controlled technology is released to a foreign national.
- 16. Fundamental Research Exception » FRE does not apply when research results are restricted for proprietary reasons, or are subject to specific U.S. Government dissemination controls − Specific EAR examples ˗ required pre-publication review by the government, with right to withhold permission for publication; ˗ restrictions on pre-publication dissemination of information to non-U.S. citizens or other categories of persons; or ˗ restrictions on participation of non-U.S. citizens or other categories of persons in the research. » Compliance Recommendations and Common Pitfalls 10
- 17. FY2019 U.S. Exports to the UK − Export applications (excluding deemed exports) • average processing time - 16 days, as compared to the overall average of 23 days. • approval rate - 89.5% (or 1,688 applications), compared to the overall average of 85.5% − Deemed exports • filed applications - British Nationals’ applications account for only 2.4% of total filed applications • approved - no denial to British Nationals since 2015 − Exports to UK subject to a license requirement • only 1.9% of the U.S. exports to the U.K. required a BIS license − Most common license exceptions • encryption commodities • software, and technology (~ 57.3% of license exceptions utilized) • temporary export – third most commonly used license exception 11
- 18. Practice Education Bar Admission Panelist Bio 12 Antonia Tzinova Antonia Tzinova Partner 202.419.2661 Antonia.Tzinova@hklaw.com Washington, D.C. Antonia I. Tzinova is an attorney in Holland & Knight's Washington, D.C., office. Ms. Tzinova practices in the areas of international trade, foreign direct investment and industrial security. She advises on defense and high-technology exports; U.S. trade embargoes and economic sanctions; and customs matters. She regularly represents clients before the Committee on Foreign Investment in the United States (CFIUS) and advises on measures to mitigate Foreign Ownership, Control, or Influence (FOCI) in cross border mergers and acquisitions of U.S. government and defense contractors. She counsels foreign investors on structuring investments in the defense, high-tech and critical infrastructure sectors of the U.S. economy. Full Bio available here. • CFIUS and Industrial Security • International Trade • Mergers and Acquisitions • The George Washington University Law School, J.D., with honors • Sofia University Law School (Bulgaria), Jurist and Masters in Law (J.D./LL.M. equivalent), International Law and International Affairs • District of Columbia • Maryland
- 19. Practice Education Bar Admission Panelist Bio 13 Ronald A. Oleynik Ronald A. Oleynik Partner Washington, D.C. T 202.457.7183 ron.oleynik@hklaw.com Ronald A. Oleynik is a partner practicing in Holland & Knight's Washington, D.C., office in the area of international trade regulation. His experience includes a broad range of industrial security, customs, export and international trade matters. In the area of U.S. export control, Mr. Oleynik counsels a broad range of clients on licensing, compliance, and enforcement issues under the export control regimes of the departments of State, Commerce and Treasury In the area of industrial security, Mr. Oleynik has been involved in a significant percentage of all foreign investment review proceedings before the Committee on Foreign Investment in the United States (CFIUS), and is one of the leading practitioners in the area of foreign direct investment in the U.S. defense industry under the U.S. regulations regarding Foreign Ownership, Control and Influence (FOCI). He represents a wide array of clients in trade litigation before the U.S. Department of Commerce and International Trade Commission regarding Antidumping and Countervailing Duty investigations and reviews, Section 232 national security investigations and Section 332 investigations. Read more: https://www.hklaw.com/Ronald-Oleynik/ • Aviation • International Trade • Cuba Action Team • China Practice • International and Cross Border Transactions • The George Washington University Law School, J.D. • University of Connecticut, B.A., Political Science • The George Washington University, M.A., International Affairs • District of Columbia
- 20. Practice Education Bar Admission Panelist Bio 14 Dariya Golubkova Dariya Golubkova Associate 202.469.5498 Dariya.Golubkova@hklaw.com Washington, D.C. Dariya V. Golubkova is a Washington, D.C., attorney and a member of Holland & Knight's International Trade Group. Her practice comprises a broad range of international trade regulatory and transactional matters, including economic sanctions, export controls, customs, and industrial security matters. She has experience in assisting clients in complying with U.S. export control laws, such as the International Traffic in Arms Regulations (ITAR) and the Export Administration Regulations (EAR), and U.S. economic sanctions programs, particularly those involving the Russian Federation. She also has experience representing clients before the Committee on Foreign Investment in the United States (CFIUS). Leveraging her prior experience as a federal judicial law clerk, she also represents clients before the U.S. Court of International trade. Full Bio available here. • International Trade • CFIUS and Industrial Security • Brooklyn Law School, J.D. • The George Washington University, B.A., Political Science, cum laude • New York