On October 15, 2013, two Final Rules ushering in the “initial implementation” of the Export Control Reform (ECR), by the Departments of State and Commerce, will take effect. The Final Rules transfer jurisdiction of many less-sensitive military items, which are currently controlled on the U.S. Munitions List and governed by the State Department’s International Traffic in Arms Regulations (ITAR) to the Commerce Control List that are governed by the Commerce Department’s Export Administration Regulations (EAR). This is done through the creation of new “600 Series” classification provisions. The Final Rules mandate significant changes in licensing authority for affected items and pronounce transition rules for existing authorizations. Importantly, the Rules create a “catch-and-release” definition of “Specially Designed” items controlled for defense trade purposes. These new Final Rules may impact your current jurisdictional authority and classifications.
While the ECR aims to reduce certain restrictions on exports, such as on the new 600 Series items (certain vehicles and aircraft, for example), the new framework also maintains certain controls through licensing and classification requirements. Notably, the 600 Series coverage is intended to differentiate between those military items that are “critical to maintaining a military or intelligence advantage to the United States” and those that require more flexible controls in order to facilitate and encourage exports to U.S. allies.
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