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Export Controls and CSU

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Presentation on theme: "Export Controls and CSU"— Presentation transcript:

1 Export Controls and CSU
Export Control Administrator Introduce you to the concepts of EC, tell you about my job and how I can help you, and answer any questions you have.

2 Why Have Export Controls?
The U.S. Government’s larger interests: Protecting military technology from distribution abroad. Protecting the domestic technology that was funded and conducted to further U.S. economic security. Tracking the distribution of allowed exports to uncover wider individual or organizational behaviors that threaten U.S. interests. Furthering U.S. foreign policy. Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

3 Once Upon a Time… Export Control Act (July 5, 1940)
Japanese occupation of Indo-China All airplane parts, aviation fuel, scrap Extended in 1949 as greater economic and foreign policy tool Arms Export Control Act of 1976 Cold War Focus on large and powerful enemies/allies, military technology Post-9/11 Shift to collecting information on sub-national groups and networks, dual-use technology Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

4 Export Controls Today “Export Controls” generally include several federal laws and regulations: Arms Export Control Act Export Administration Act International Traffic in Arms Regulations (ITAR) Export Administration Regulations (EAR) Treasury/OFAC Regulations Dept. of Energy Regulations Through these laws, the federal government seeks to control the export of goods, money, and technology to certain countries, corporations, and individuals. Under certain circumstances, a license must be applied for and received from an agency prior to an export. In some cases, a license will be denied. Purposes: National Security, Foreign Policy (Anti-terrorism, Crime, Regional Stability), Nonproliferation CERTAIN COUNTRIES, CERTAIN PEOPLE/COMPANIES Also: Dept. of Treasury (OFAC)

5 What is an Export? An export can be any of the following:
actual shipment of any covered goods or items; the electronic or digital transmission of any covered goods, items, or related goods or items; any release or disclosure, including verbal disclosures or visual inspections, of any technology, software or technical data to any foreign national wherever located; or actual use or application of covered technology on behalf of or for the benefit of any foreign entity or person anywhere. Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

6 What are Export Controls?
There are three primary areas of attention for CSU: (1) International Traffic in Arms Regulations (ITAR), created by the Department of State under 22 CFR §§ Enforced by the Directorate of Defense Trade Controls (DDTC). The ITAR covers defense related articles and information used for military purposes such as: explosives, chemicals delivery systems, and biological agents. These items and technologies often appear in sponsored research from federal agencies or private contractors. “Defense Service” was recently defined by the DDTC to include “mere access” to a defense article. “Dual-Use” helpful to categorize the EAR. Discreet jurisdiction flows downhill from the State Department Publicly available technology and encryption not included; published patents, etc.

7 What are Export Controls?
(2) Export Administration Regulations (EAR), created by the Department of Commerce under 15 CFR §§ Enforced by the Bureau of Industry and Security (BIS). Included in this section are “dual-use” items. This means an item or technology not primarily of a military nature, but which could be utilized or incorporated into a military device or activity. Technically, all items not covered by ITAR are covered by the EAR, but many do not require licenses. Deemed Exports apply only to “development, production, or use” of controlled technology. “Use” defined as “Operation, installation, maintenance, repair, overhaul, AND refurbishing.” “Dual-Use” helpful to categorize the EAR. Discreet jurisdiction flows downhill from the State Department Publicly available technology and encryption not included; published patents, etc.

8 What are Export Controls?
(3) Economic Sanctions and Blocked Individuals, as enforced by the Department of Treasury’s Office of Foreign Asset Control (OFAC). OFAC restricts trade with certain individuals and elements within particular countries, as dictated by U.S. foreign policy. Additionally, U.S. citizens may also be restricted from certain transactions. Blocked party lists are updated regularly in the Federal Register. Emerging areas of concern include China, Iran, and Syria. “Dual-Use” helpful to categorize the EAR. Discreet jurisdiction flows downhill from the State Department Publicly available technology and encryption not included; published patents, etc.

9 Fundamental Research The Fundamental Research Exclusions of EAR and ITAR state that no license is required to disclose to a foreign person information that is: “published and which is generally accessible or available to the public [through for example] fundamental research in science and engineering at universities, where the resulting information is ordinarily published and shared broadly in the scientific community.” The majority of University research falls in this category. Does NOT apply to: Physical equipment Research where there is no intent to publish/contractual restrictions on publication Research conducted outside the U.S.

10 Bona Fide Employee Exemption
Only applies to the ITAR. Applies to the release of unclassified information to a non-U.S. person who is a full-time, bona-fide employee, with a permanent abode in the U.S. during employment. Employer must inform employee, in writing, about export control issues to which they will be exposed. Applies to Technical Data only, not Assistance or Physical Goods.

11 “Classroom” Exception
Applies to educational information released by instruction in catalog courses and associated teaching laboratories. Applies to courses available globally on-line (“distance learning”) - but not to OFAC-embargoed countries. Does NOT apply to instruction or training regarding design, development, engineering, manufacture, assembly, testing and use of a defense article. Does not apply to encryption software. Dissertation research must meet the standards for “fundamental research” to qualify under this exception as “publicly available”.

12 Not Just a Research Issue…

13 Export Controls in the University Setting
“Deemed Exports” Disclosing controlled technology to a foreign national in the U.S. Graduate Students/Employees International Visitors International Research Shipping or using technical equipment abroad International Collaboration Exchanging information with international research partners International Travel Taking information abroad, i.e. on a laptop or flash drive

14 Export Controls in the University Setting
Hiring/Human Resources Screening for hires/visiting scholars I-129 attestation forms Visa applications Purchasing Transactions with SDNs/Blocked Parties Transactions with Embargoed Countries Shipping Material destinations and end users

15 Deemed Exports – In Action!
Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

16 Export Regulations: The Only Constant is Change
Removal of Myanmar, Afghanistan from most sanctions Changes in Sudan Daily changes to the disbarred/suspended entity lists New OFAC sanctions on Iran New advisory opinions and prosecutions show shifting nature of agencies Sweeping transition between ITAR and EAR, ?? Jan 3rd – President signed satellite export control reform bill

17 Learn to spot “Red Flags”
Restrictive terms in agreements Who can participate in the work What you can publish When you can publish How you can share, distribute, or use results Work done abroad Sending abroad information, material or equipment Electronic sharing of software or other technology including Not publicly available Encryption software Defense article or service Ultimate destination or use unknown (you send it overseas and the recipient sends it to someone else) Sending, transmitting or disclosing to a sanctioned country or a person or organization on the restricted party lists Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

18 A Renewed Emphasis on Export Controls
Prior to 9/11, universities claimed that their operations fell completely under the “Fundamental Research Exclusions” that are included within both EAR and ITAR. As such most universities paid little thought to the issues surrounding export controls. Post 9/11, the Department of Homeland Security and the various agency enforcement arms are tracking the sponsored research from groups such as DoD, NASA, and DoE, as well as Universities generally, much more closely in the area of export-controlled technology. Advances in monitoring technology and a proliferation of agents are leading to greater enforcement.

19 Penalties for Non-Compliance
Institutional Liability and Personal Liability Criminal and Civil Penalties Example: University of Tennessee Department of State (Directorate of Defense Trade Controls) Personal and Institutional fine of up to $1,000,000 and up to 10 years in prison. Department of Commerce (Bureau of Industry and Security) “Willful” violation: Personal fine up to $250,000, and up to 10 years in prison. Institutional fine up to $1,000,000. “Knowing” violation: $50,000 and up to 5 years in prison. Department of the Treasury (Office of Foreign Asset Control) Criminal: Fine up to $1,000,000. Civil: Fine up to $55,000 per violation.

20 CSUS Board of Governors: Export Control Policy Statement
Adopted 10/5/2012. “[CSUS] is committed to the highest level of compliance with all applicable U.S. export control laws and regulations…” “Each institution shall develop specific policies and procedures as necessary to comply with this Policy…and shall maintain such…to remain current with changes in applicable laws.” CSU policy adopted 12/31/2012:

21 CSU and Export Controls
Role of the Export Control Administrator: Help educate and protect P.I.s and other University personnel Protect the Institution Conduit between University personnel and federal agencies Be Practical and Facilitative Answer Inquiries Promptly and Give Full Assistance Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

22 Hypothetically… “You need to clear this with us before you publish…”
Formal and informal permission restrictions on publication destroys the Fundamental Research Exclusion. “No foreign nationals will work on this, right?” If accepted, even informal restriction of foreign project personnel destroys the Fundamental Research Exclusion. “We need 60 days to review this for proprietary information before you publish.” Review-only does not destroy Fundamental Research Exclusion. “DoD says this technology isn’t controlled.” What DoD thinks is irrelevant; only the enforcement agencies (DDTC, BIS) make jurisdiction decisions. Relying on interpretations or claims from any other source puts you at risk.

23 Hypothetically… “This equipment isn’t from the government, so it’s not controlled.” It is the nature of the technology, not its source, that determines whether or not it is controlled. “My NDA says I can’t ever publish this health data I’m using.” Restrictions on publication are fine if the data in question is not subject to export controls. “Let’s see what my foreign colleague thinks about this problem.” The informal discussion or transmission of technical documents regarding a controlled project are an export, even if the collaborator isn’t officially on the project. “I didn’t need a technology control plan on a prior similar project.” The establishment of the Export Control program as mandated by the Board of Governors, along with an increase in restrictive contract language on publication and other issues, has caused some projects and technology that was previously uncontrolled to require attention going forward. The Export Control Administrator will work with all faculty to ensure that any control process is as fast and unobtrusive as possible. Early contact with the ECA will help minimize delays. In Sum: Contact the ECA when any red flags or questions arise, or just for clarification on Export Control rules or procedures.

24 Hypothetically… SCENARIO 1
Professor X is performing fundamental research on how penguins play underwater tag, using military sonar equipment and non-military GPS equipment. He is on location in Argentina and Antarctica. Professor X has three graduate assistants. Two with her on assignment are from Canada and China, although the Chinese student is now a citizen of the U.K. .The third is back on campus crunching the numbers, and he is from Iran. The research is funded by National Geographic, which is withholding publication rights to the results in case there is something juicy, and they want to use it on their penguin reality television show. Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

25 Hypothetically… SCENARIO 2
Professor Y runs a lab where his undergrads do assigned lab work, and his graduate students do sponsored research. In particular, a high-powered electron microscope is used, which is controlled by the Commerce Department under the EAR. On the other side of the lab, another professor has a plasma thruster she uses to test materials, which is controlled by the State Department under the ITAR. Professor Y invites his colleagues from Germany, China, Pakistan, and Iran to campus for a visit. They visit the lab, looking at all the projects taking place there. Professor Y gives a draft of his new research paper in development to all of his visitors on hyper-encrypted flash drives. The guests tour the local breweries and go home to their respective countries. Export, Re-export, Deemed Export Visual, Oral, By application/demonstration

26 CSU and Export Controls
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