• Information on changes under the ECR, governing authorities and legislation
• Practical advice for businesses working with controlled US-origin items

The ongoing U.S. Export Control Reform (ECR) presents major challenges for EU businesses in various industry sectors, including aerospace, automative, defence, and telecommunications. Which authority now controls which US-origin items? Which items have moved from the USML to the CCL? Are licence exemptions under ITAR still valid under EAR? A new white paper by AEB, a leading provider of global trade and supply chain management solutions, provides answers to these questions. Titled “Navigating the U.S. Export Control Reform”, the white paper can be downloaded free of charge at http://www.aeb.com/US-ECR.

The ECR’s objective is to simplify U.S. export controls while enhancing U.S. security. Its ultimate goal is the consolidation of the two primary control lists – the United States Munitions List (USML) and the Commerce Control List (CCL) – into a single control list administered by one single agency using one central computer system. As part of this, a large number of items previously classified as munitions are currently being transferred from the USML, administered by the Department of State, to the CCL, administered by the Department of Commerce. 

Due to the extraterritorial reach of U.S. export controls, it is important that non-U.S. companies are aware of their obligations and seek the relevant authorisations - even if they are not located in or ship to the U.S. - in order to avoid violations and corresponding penalties. Prior to the reform, many companies dealt primarily with the International Traffic in Arms Regulations (ITAR), and now that various items are being transferred to the CCL, these businesses need to urgently familiarise themselves with the Export Administration Regulations (EAR).  

AEB’s new white paper provides an overview of changes and requirements under the ECR, with a special focus on companies that are currently not familiar with the U.S. EAR. It introduces the basic principles of the reform, governing authorities and legislation, and highlights key changes including the re-definition of what it means for a product to be “specially designed” for military end-use, the new Strategic Trade Authorization, and applicable transition procedures. The white paper offers guidance for everyday business, including the correct identification of ECCN numbers, calculation examples of “de minimis”, an overview of general prohibitions, and latest links and references to official U.S. government guides and applicable tools.  

Claire Umney, General Manager at AEB (International) Ltd, said: “In the midst of Phase 2 of the ECR, there is still some confusion about the reform, who it applies to and how the changes affect businesses in their daily operations. Our new white paper helps companies understand what the ECR means for them and their export control processes, and supports them in complying with applicable U.S. laws to avoid potential violations and the resulting sanctions, criminal and/or civil penalties, and reputational damages.”

AEB’s new white paper “Navigating the U.S. Export Control Reform” can be downloaded free of charge at www.aeb.com/US-ECR.