The Department of State is making a temporary reduction in certain International Traffic in Arms (ITAR) registration fees, as announced May 6, 2020. The ITAR provides that any person who engages in the United States in the business of manufacturing, exporting, or temporarily importing defense articles, or furnishing defense services, or who engages in brokering activities is required to register with the Directorate of Defense Trade Controls (DDTC). The announcement provides a temporary reduction in the ITAR registration fee due from these parties, to help mitigate the economic impact of the COVID-19 pandemic.

DDTC will temporarily reduce registration fees to $500 for:

• Tier 1 and Tier 2 registrants whose ITAR registration has an original expiration date between May 31, 2020 and April 30, 2021.
  • Companies in Tier 1 include: (i) first time registrants; (ii) stand-alone brokers (U.S. and foreign owned or controlled by U.S. persons); (iii) registrants who did not submit any license application or request for authorization during the twelve-month period ending 90 days prior to the expiration of the current registration; and (iv) registrants who are wholly exempt from income taxation pursuant to 26 U.S.C. 501(c)(3). The registration fee for Tier 1 companies has been reduced from $2,250 to $500 for registrations with an original expiration date between May 31, 2020 and April 30, 2021.
  • Companies in Tier 2 include those registrants who have submitted and received favorable authorization for ten or fewer license applications or requests for authorization during a twelve-month period, ending 90 days prior to the expiration of the current registration. The registration fee for Tier 2 companies has been reduced from $2,750 to $500 for registrations with an original expiration date between May 31, 2020 and April 30, 2021.
• New applicants who submit their registration application between May 1, 2020 and April 30, 2021. All new applicants are treated as being in Tier 1 during their first year of registration. Therefore, the registration fee for new applications submitted between May 1, 2020 and April 30, 2021 will be reduced from $2,250 to $500.

The fee structure for Tier 3 registrants will remain unchanged. Tier 3 companies are those that have submitted and received a favorable authorization on more than ten license applications or requests for authorization during a twelve-month period, ending 90 days prior to the expiration of the current registration. The registration fee for these companies is $2,750 plus $250 times the total number of applications over ten, with a provision to cap the fee for companies that submit a large number of low value license applications.

ITAR registration fees are paid as part of the registration process through the new Defense Export Control and Compliance System (DECCS). Companies must be enrolled in DECCS in order to submit the ITAR registration. After the submission has been accepted and reviewed by DDTC, the registrant will be instructed to make an electronic payment of the fee.