Export controls - University of Toledo

Report
Office of Research and Sponsored
Programs
U.S. Export Control Laws
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What is an “export”?

Exports: The shipment or transfer of items, information or
software outside the U.S. or; the release or
sharing of restricted technology or data – orally or
in writing – with foreign nationals inside or outside
the U.S.
•
Items – Tangible things, equipment or hardware
• Information = “Technical Data” such as models, formulae,
engineering designs, or; technical assistance such as training or
instruction.
• Software – Computer programs or microprograms in
either “Source Code” (programming statements) or
“Object Code” (machine-readable instructions).
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Tangible vs. “Deemed Exports

An “export” is a tangible shipment of an item, information or
software outside of the U.S.
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A “deemed export” is a "release” of information or software
code to a foreign person in the U.S.
• Transmitting the technology to a foreign national, an individual other
than a U.S. citizen or permanent resident, within the United States.
• Foreign national – a person residing in the U.S. who is not a lawful
permanent resident.
• Also includes any foreign corporation, business association,
partnership, trust, society, or any other group not incorporated to
do business in the U.S., and any international organization, foreign
government, or diplomatic entity.
• Can be oral or written disclosure, or through visual inspection
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More on “Deemed Exports”
 For an immigrant alien who possesses a green
card for permanent residence in the U.S.: For the
purposes of export control regulations, such an
individual is a “U.S.” person and can be allowed
access to export controlled information without an
export license.
 For a UT employee who is an immigrant alien who
does not posses a green card for permanent
residence in the U.S.: Only ITAR provides a limited
exemption to disclose technical data at MSU to fulltime foreign employees under specific conditions.
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What are Export Controls?

Export controls are federal laws
that regulate the export of sensitive
technologies, equipment, software,
biological agents, and related data
and services to anyone, including
U.S. citizens, or to foreign
nationals or representatives of a
foreign entity on U.S. soil for
reasons of national security and
protection of trade.
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Export Control Objectives
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Deny our adversaries the means to advance
their military potential
Implement foreign policy objectives
Prevent Terrorism
Inhibit the proliferation of Weapons
of Mass Destruction
Fulfill Multilateral Obligations
(UN sanctions,
various trade
agreements).
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Why are These Laws Important
 Violations of trade sanctions and export controls
can result in criminal penalties:
Heavy Institutional Fines
(up to $1 M per violation)
Individual Prison Terms
(up to 20 years per violation)
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Enforcement of Control Laws

Department of Commerce – Export Administration
Regulations (EAR)

Department of State – International Traffic in Arms
Regulations (ITAR)

Department of Treasury, Office of Foreign Assets
Control (OFAC) – Restricts exports and imports
through economic sanctions against certain
countries
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Export Administration Regulations (EAR)
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Enforced by Bureau of Industry & Security (BIS)
Governs export and re-export of all U.S. origin
items, information and/or software
Covers “dual use” items, information and software
designed for commercial purposes but having
military applications
Exports organized into 10 discrete categories on
Commodity Control List (CCL)

Captures many common areas of university research
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Commodity Control List
Ten Specific Categories:
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Nuclear materials, facilities, equipment research
Chemicals and toxins
Materials processing, i.e., making plastics, metals
Electronics development
Computer development and programs
Telecommunications
Information security (encryption)
Sensors and lasers
Navigation and avionics
Propulsion systems and space vehicles
EAR99 – catch-all (subject to EAR, but not CCL listed)
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EAR Licensing Continuum
Not on CCL/EAR
99 - No License
Required Except
to Embargoed
Countries
Less Restrictive
On CCL/No
License Required
to Country of
Export
On CCL –
License Required
to Country of
Export, but
License Exception
Available
On CCL –
No License
Exception
Available License Required
More Restrictive
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International Traffic in Arms Regulations
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(ITAR) enforced by State Department’s Directorate of
Defense Trade Controls (DDTC)
Transfer and export of technologies relating to military
applications (including satellite technologies) listed on the
U.S. Munitions List.
Examples:
•Electronic equipment, systems, or software
•Technical data related to manufacture or production
•Classified information security systems
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22 CFR 121: Munitions
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Firearms
Artillery projections
Ammunition
Launch vehicles, guided
missiles, ballistic missiles,
rockets, torpedoes, bombs &
mines
Explosives, propellants &
incendiary agents
Vessels of war & special naval
equipment
Tanks & military vehicles
Aircraft & assoc. equipment
Military training equipment
Protective personnel
equipment
• Military electronics***
• Fire control, range finder,
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optical & guidance & control
equipment
Auxiliary military equipment***
Toxicological agents & equip.
& radiological equip.
Spacecraft systems &
equipment***
Nuclear weapons design & test
equipment
Submersible vessels,
oceanographic & associated
equipment
Misc. articles***
***Significant items of interest to research
institutions
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Prohibited Countries
From 22 CFR 126.1:
“It is the policy of the United States to deny licenses, other approvals, exports
and imports of defense articles and defense services, destined for or
originating in certain countries.”
Applicable Countries
Afghanistan
Armenia
Azerbaijan
Belarus
Cuba
Iran
Iraq
Liberia
North Korea
Syria
Tajikistan
Ukraine
Vietnam
Arms Embargoed Countries
Burma
China
Fed. Rep. of Yugoslavia
Haiti
Liberia
Rwanda
Somalia
Sudan
Zaire
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Office of Foreign Assets Control
 OFAC enforced by the Treasury Department’s Office of

Foreign Assets Control (OFAC)
Places economic sanctions and/or transfer of payments,
property, or anything of value to:
• Sanctioned or Embargoed countries
• “Specially Designated Nationals (SDNs) – terrorists,
drug kingpins, and persons involved with WMDs
(includes organizations to which SDNs belong)
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OFAC Countries
Subject to U.S. Trade
Embargoes
Sanctioned Countries and
Territories
Burma
Cuba
Iran
Syria
North Korea
Sudan
Balkans
Cote D’Ivoire
Iraq
Liberia
Libya
Palestinian Authority
Zimbabwe
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OFAC Prohibited Activities
• Shipment of tangible items in support of research with
knowledge that items will be used in or for the benefit of
the embargoed country
• Payments to persons including organizations to conduct or
support in-country research (i.e. surveys, interviews,
fellowships, etc.)
• Providing financial or material support to conferences
hosted or co-hosted by academic institutions in
embargoed countries
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Applicability

These laws apply to all research activities
whether or not there is a specific citation to the
regulations in the grant or contract award
document governing the project.
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These laws also apply to export-controlled
information or technology shared with
researchers by others from government,
industry, or other universities.
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Applicability

The majority of university research efforts are
not restricted by export regulations. However,
export control may apply when one or more of
the following concerns pertain to the research
project:
• It has actual or potential military applications
• The destination country, organization, or individual
is restricted by federal law
• The declared or suspected end use or the end
user of the export compromises national security
• Economic protection issues are associated with
the destination country
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Export Control Exclusions
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This is how researchers and research institutions
can:
• Exempt certain information and software from
export licensing requirements
• Stay out of jail!
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Export Control Exclusions
• Public Domain Exclusion (ITAR)
• Publicly Available Exclusion (EAR)
• Educational Information Exclusion
• Employment Exclusion (ITAR)
• Fundamental Research Exclusion
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Public Domain Exclusion (ITAR)
 Export controls do not apply to information and
research results already published and publicly
available from:
• Public libraries, newsstands or bookstores;
• Unrestricted journal and magazine subscriptions
• Published patents
• Conferences, meetings, seminars, trade shows or
exhibitions in the U.S.; and/or
• Websites accessible to all members of the public,
free of charge.
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Publicly Available Exclusion (EAR)
 CCL listed information and software that is
generally accessible to the public in any form
through any one or more of the following:
• Publication in periodicals, books, electronic, or any
other media
• Public and university libraries;
• Published patents and applications; and
• Conferences, meetings, seminars, trade shows or
exhibitions in the US or abroad
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Educational Information Exclusion
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ITAR – Export Controls do not apply to
information concerning “general scientific,
mathematical or engineering principles commonly
taught in schools, colleges and universities.”

EAR – Export Controls do not apply to
“educational information” released by instruction
in catalog courses and associated teaching
laboratories.
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Employment Exclusion (ITAR)
Export license not required for universities to share
information in the U.S. with a foreign person if that
person:
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Is a “bona fide” employee of the university – full time with
full benefits
• Grad students and most post-docs are excluded
Not a national from an ITAR embargoed country
• Belarus, Cuba, Iran, Libya, North Korea, Syria,
Vietnam, Burma, China, Haiti, Liberia, Somalia,
Sudan, Iraq, Afghanistan, Rwanda, and Democratic
Republic of the Congo
Resides at a permanent address in the U.S. while
employed
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Fundamental Research Exclusio
It is federal policy “that, to the maximum extent
possible, the products of fundamental research
remain unrestricted.”
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Definition (National Security Decision Directive 189) –
“Basic or applied research in science and engineering,
the results of which ordinarily are published and shared
broadly within the scientific community.”
Covers most basic research at colleges and universities
Information must have been generated in the U.S.
(foreign generated info may qualify under other public
domain criteria)
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Fundamental Research Exclusio
Fundamental Research Exclusion does not apply if:
University accepts any restrictions on the publication
of resulting information, other than 90 day review by
sponsors to:
 Prevent divulging proprietary information
 Insurance against compromising a patent
Fundamental Exclusion destroyed by any clause that:
 Gives sponsor right to approve publications
 Restricts research participation of foreign nationals
 Exclusion is destroyed irregardless of sponsorship
(federal, private, or non-profit)
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University of Toledo
As a public university, the University of
Toledo is committed to the widest possible
public dissemination of scientific learning
and research results.
Therefore, all information and data to be
created or used at UT must fall under the
definition of fundamental research as set
forth in NSDD 189.
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Concerns for Researchers
 Does the contract or grant:
 Restrict publication or presentation of research results?
 Prohibit training or collaboration with foreign nationals
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on any aspect of the research project?
Prohibit results or deliverables from being disclosed or
delivered to any country or persons?
Contain any reference to export controlled technologies
 Will the project require any tangible export of
materials to a foreign country of concern?
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Research samples, shared equipment, software,
publication drafts, travel, other transactions
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More Concerns for Researcher
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Third-party items, information or software to
which information exchange, publication freedom
or foreign national access is restricted
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Any Item, information or software that is:
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Designed or modified for a military use
For use in outer space
Potentially used in/for a weapon of mass destruction
(nuclear, chemical, biological, missiles)
included on any other export control list
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What Needs to be Done?

Beware of existing export control laws and
regulations.
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Screen proposals and contracts for any possibility
of application to these laws
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Shipment of equipment to a foreign country
Training or collaboration with foreign nationals
Any work or travel to an OFAC controlled country
Any reference to export controlled technologies in the award
Negotiate removal of all contract terms that limit:
• Rights to publish or present results
• Access or participation of foreign nationals
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Export Control Contacts at UT
Kandace Williams, Ph.D.
Research Compliance Officer
Office of Research University Hall – Room 2300
(419) 530-2844
(419) 530-2841(fax)
Kandace. [email protected]
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Test Case Study #1
Your Principal Investigator (PI) is doing research in the field of
remote sensing. Your institution receives a research contract
from the Department of Defense (DOD) as well as a
subcontract from another university in support of this work.
Both agreements incorporate the following clause:
The Contractor shall not release to anyone outside the
Contractor’s organization any unclassified information,
regardless of medium (e.g., film, tape document),
pertaining to any part of this contract or any program
related to this contract, unless…..
Answer
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Test Case Study #1
 The research to be performed falls under ITAR Category XV. The project
does not involve providing a defense service, because it is a fundamental
research project.
 This clause could restrict publications. If the restrictive publication clause
is not modified, a license from the State Department would be required to
publish the technical data, unless specifically approved by the DOD.
 The clause does not comply with various federal policies which state that
papers or other publications resulting from unclassified contracted
fundamental research are exempt from any prepublication controls.
 This clause cannot be accepted.
 The clause must be modified to protect the university’s and researcher’s
right to freely publish any and all information pertaining to the project.
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