Presentation on theme: "Jennifer P. May, J.D. Associate Director of Compliance MU Office of Research."— Presentation transcript:
Jennifer P. May, J.D. Associate Director of Compliance MU Office of Research
Learning Objectives The Agencies: Who Sets the Rules? The Definitions: Who and What is Impacted? The Rules: What is Controlled? The Exclusions: Who and What is Not Impacted? The Research: How do we Protect this Work? The Enforcement: What Happens if we Break a Rule? The Rest: What else should we consider?
We need to comply because… Growing foreign national employee and student populations involved in technology-related research Growing portfolio of defense-related research, both with government and industry sponsors increasing contractual restrictions on research Growing portfolio of international collaborations Failure to comply with U.S. export and sanction laws can result in severe penalties
Who Sets the Rules?
U.S. Department of State Directorate of Defense Trade Controls International Traffic in Arms Regulations (ITAR) U.S. Munitions List Defense Articles Defense Items Technical Data about defense items Defense Services Controls exports and temporary imports* for purposes of: U.S. national strategic objectives Defense trade policies Arms embargoes Terrorism sanctions *The ATF controls permanent import of munitions
U.S. Department of Commerce Bureau of Industry and Security Export Administration Regulations (EAR) Commerce Control List “Dual use” items and technologies Commerce also houses: Patent and Trademark Office Patents, trademarks, copyrights Bureau of the Census Trade statistics
Foreign Assets Control Regulations (FACR) Financial transactions Exportation or importation of goods and services Blocked property For the purposes of: U.S. foreign policy goals U.S. national security goals Economic and Trade Sanctions Targeted foreign countries Terrorists International narcotics traffickers WMD proliferation activities U.S. Department of the Treasury Office of Foreign Assets Control
U.S. Department of Energy Nuclear Regulatory Commission Export and Import of Nuclear Equipment and Materials Regulations (EINEMR) Nuclear equipment or material such as reactors Assistance to Foreign Atomic Energy Activities Regulations (AFAEAR) Activities or training, directly or indirectly, involving nuclear technology Other nuclear-related commodities and technology are under the export licensing authority of the Department of Commerce
Disclosure of Information DFAR (Dec 1991) 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— The Contracting Officer has given prior written approval; or The information is otherwise in the public domain before the date of release Requests for approval shall identify the specific information to be released, the medium to be used, and the purpose of the release. The Contractor shall submit its request to the Contracting Officer at least 45 days before the proposed date for release.
The Contractor shall comply with all applicable laws and regulations regarding export-controlled items, including, but not limited to, the requirement for contractors to register with the Department of State in accordance with the ITAR. The Contractor shall consult with the Department of State regarding any questions relating to compliance with the ITAR and shall consult with the Department of Commerce regarding any questions relating to compliance with the EAR. The Contractor's responsibility to comply with all applicable laws and regulations regarding export-controlled items exists independent of, and is not established or limited by, the information provided by this clause. … The Contractor shall include the substance of this clause, … in all subcontracts. items. Export-Controlled Items DFAR (Apr 2010)
from the federal register notice… including universities performing contracts for fundamental research only “The clause puts all contractors, including universities performing contracts for fundamental research only, on notice that they are responsible for complying with all applicable export control laws and regulations.” Export-Controlled Items DFAR (Apr 2010)
Who and What is Impacted?
Key Definitions: Export Sending or taking a tangible item outside of the U.S. Sending from one foreign country to another (aka ‘re-export) items or technology of U.S. origin (including some foreign- made items that incorporate U.S.-origin components or technology) Disclosing (including oral or visual disclosure) technical data, technology, or source code to a non-U.S. Person, in the U.S. or abroad Providing technical assistance, training, or defense services to a non-U.S. Person, whether in the United States or abroad 22 CFR § and 15 CFR § 734.2
Key Definitions: U.S. Person Persons who are permitted to access export controlled items without restrictions: U.S. Citizens Aliens who are “Lawful Permanent Residents” Green Card holders* Other “Protected Individuals”* designated an asylee or refugee a temporary resident under amnesty provisions Any entity incorporated to do business in the U.S. 8 USC§1101(a)(20) and 8 USC§1324b(a)(3)
Key Definitions: Foreign Person “Foreign Person” means everyone not a U.S. Person Any foreign interest and any US Person effectively owned or controlled by a foreign interest Includes foreign businesses not incorporated in the U.S. and persons representing other Foreign Persons Includes: H-1B Work Visa, F1 Study Visa, J1 Training Visa, E1 Investors Visa, TN Work Visa, L1 Intra-Company Transfer Visa, K and V Fiancée Visas EAR does not use the term foreign person, but rather foreign national – definition is the same as above
What is Controlled?
Regulations International Traffic in Arms Regulations (ITAR) Export Administration Regulations (EAR) Office of Foreign Assets Control (OFAC) Sanctions Programs EAR and ITAR sanctions
ITAR: U.S. Munitions List I – Firearms II – Artillery Projectors III – Ammunition IV – Launch Vehicles, etc... V – Explosives, Propellants, Incendiary Agents and Their Constituents VI – Vessels of War and Special Naval Equipment VII -Tanks and Military Vehicles VIII – Aircraft and Associated Equipment IX – Military Training Equipment X – Protective Personnel Equipment XI – Military Electronics XII – Fire Control, Range Finder, Optical and Guidance and Control Equipment XIII – Auxiliary Military Equipment XIV – Toxicological Agents and Equipment and Radiological Equipment XV – Spacecraft Systems and Associated Equipment XVI – Nuclear Weapons Design and Related Equipment XVII – Classified Articles, Technical Data and Defense Services Not Otherwise Enumerated XVIII – Directed Energy Weapons XIX – Reserved XX – Submersible Vessels, Oceanographic and Associated Equipment XXI – Miscellaneous Articles 22 CFR §121
ITAR: Exports Determination Export of U.S. Munitions List Items and Technologies restricted to all destinations. Very few, narrow exemptions or exceptions
ITAR: Defense Article/Technical Data Defense Article Any item or technical data designated on the U.S. Munitions List Technical Data Information required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance OR modification of defense articles Does NOT Include: information in the public domain, or information concerning general scientific, mathematical or engineering principles commonly taught in schools, colleges and universities, or basic marketing information on function or purpose or general system descriptions of defense articles 22 CFR§120.6 and
ITAR: Defense Services (1) “The furnishing of assistance (including training) to foreign persons, whether in the United States or abroad in the design, development, engineering, manufacture, production, assembly, testing, repair, maintenance, modification, operation, demilitarization, destruction, processing or use of defense articles;” or (2) “The furnishing to foreign persons of any technical data controlled under this subchapter (see § ), whether in the United States or abroad.” (3) “Military training of foreign units and forces, regular and irregular, including formal or informal instruction of foreign persons in the United States or abroad or by correspondence courses, technical, educational, or information publications and media of all kinds, training aid, orientation, training exercise, and military advice.” 22 CFR§120.9
EAR: Commerce Control List Categories 0- Nuclear Materials, Facilities & Equipment & Miscellaneous 1- Materials, Chemicals, Micro-organisms and Toxins 2- Materials Processing 3- Electronics Design, Development and Production 4- Computers 5- Telecommunications & Information Security 6- Sensors and Lasers 7- Navigation and Avionics 8- Marine (ships & vessels) 9- Propulsion Systems, Space Vehicles and Related Equipment
EAR: Exports Determination Export Control Classification Number (ECCN) Technical performance characteristics Type of control End user including nationality End use
EAR: “Deemed” Export Any release of technology or source code subject to the EAR to a foreign national within the U.S or abroad. Such release shall be “deemed” to be an export to the country or countries of origin of the foreign national. Export can occur in the United States or abroad. 15 CFR§734.2(b)
EAR: Technology Specific information (or source code) necessary for the “development”, “production”, or “use” of a product listed on the Commerce Control List EAR Use: Operation, installation (including on-site installation), maintenance (checking), repair, overhaul and refurbishing of controlled items ITAR Use: Design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles 15 CFR§772
EAR: Technical Assistance and Data Technical Assistance may take forms such as instruction, skills training, working knowledge, consulting services. Technical Data may take forms such as blueprints, plans, diagrams, models, formulae, tables, engineering designs and specifications, manuals and instructions written or recorded on other media or devices such as disk, tape, read-only memories. 15 CFR§772
OFAC: What is a Sanctioned Transaction? Importation or exportation of goods or services of value to a sanctioned country, entity, or specially designated national. Engaging in a financial transaction with a sanctioned country, entity, or specially designated national. Travel to sanctioned countries Sanctioned transactions generally do not apply to activities with foreign nationals from sanctioned countries lawfully admitted to the US
OFAC: Sanctioned Countries Comprehensive Sanctions Cuba Iran Sudan North Korea Syria List Based Sanctions Balkans Belarus Burma Cote D’Ivoire Democratic Republic of Congo Iraq Lebanon Liberia: Former Liberian Regime of Charles Taylor Somalia Zimbabwe Anti-Terrorism Diamond Trading Counter Narcotics Trafficking Non-Proliferation
Other Restricted Parties Lists In addition to export and sanctioned countries, there are also restricted entities and individuals: Department of Commerce Denied Persons [BIS] Department of Commerce Entity List [BIS] Department of Commerce "Unverified" List [BIS] U.S. Treasury Department Specially Designated Nationals and Blocked Persons, including Cuba and Merchant Vessels, Iran, Iraq and Merchant Vessels, Sudan Blocked Vessels [OFAC] Department of State Designated Terrorist Organizations Department of State Terrorist Exclusion List (TEL)
Other Countries of Concern STATE (ITAR 126.1) Policy of Denial: Belarus, Burma, China, Cuba, Eritrea, Iran, Lebanon, Liberia, North Korea, Sierra Leon, Sudan, Syria, Venezuela Case-by-case Review: Afghanistan, Democratic Republic of the Congo, Haiti, Iraq, Libya, Vietnam, Somalia, and Sri Lanka
Who and What is NOT Impacted?
Higher Learning Exclusions Many university activities and research projects are NOT subject to export controls/ foreign national restrictions due to regulatory exclusions: Public Domain Information Educational information Bona fide Employee Fundamental research
Public Domain or Publically Available Information Materials available in newspapers and libraries, presented at publicly available conferences, trade shows Websites accessible to the public for free and without the host’s knowledge or control of who visits 22 CFR § and 15 CFR §734.7
Educational Information General science, math, and engineering commonly taught at schools and universities (ITAR) Information conveyed in courses listed in course catalogues and in their associated teaching labs of any academic institution (EAR) 22 CFR § and 15 CFR §734.9
“Bona fide Employees” (ITAR only) No license is required to share covered technical data with a foreign national who Is not a national of certain countries; Is a full-time, bona fide MU employee; Has a permanent address in the US while employed; and Is advised in writing not to share covered technical data with any foreign nationals. NOTE: this does not apply to post-doctoral appointees or graduate/undergraduate students! 22 CFR §125.4(b)(10)
Fundamental Research Basic or applied research at an accredited institution of higher learning in the U.S. No publication restrictions If federally funded, no access or dissemination restrictions on results As long as the above conditions are met, the results of your research are not subject to ITAR/EAR restrictions even if the subject area of the research appears on the USML or CCL. 15 CFR §§734.2, 8 & 11, CFR 22 CFR § a.8, and a.1
I’m confused… Not all “exports” are controlled Information in the Public Domain is “uncontrolled” and is eligible for unrestricted dissemination Information subject to Export Control is restricted for dissemination May require a license, or May be eligible for a license exception or exemption
How do we Protect this Work?
Conducting Restricted Research Student Participation Technology Control Plan Physical and Information Security Personnel Screening and Training Project Close-Out
Student Participation in Restricted Research MU Graduate School Policy Research Must Be Open to Public Disclosure Students are prohibited from using research (data, results, methods or other content) in their theses or dissertations that could restrict subsequent publication or public disclosure of these documents. Examples of restricted information include classified or proprietary materials. It is important to note that these restrictions do not apply to nonthesis or nondissertation research that is approved by the student's adviser and allowed by University of Missouri policies. Questions regarding the applicability of this policy to thesis or dissertation content should be referred to the Graduate School.
Technology Control Plan Institutional Commitment Commodity Jurisdiction and Classification Physical Security Plan Information Security Plan Personnel Screening Procedures Project Completion Requirements Annual Self-assessment Certification
Physical and Information Security Minimum “one lock” principle for securing controlled items Restricted work area – prevent visual and oral disclosure, key control, custodian services escorts Storage and Marking Computer, Data Storage and Transmission Encryption or Password Protection, recommend at least 12 characters including #s & special characters
Personnel Screening and Training All personnel with access to controlled items: are screened for nationality and restricted party lists are required to attend export training Includes graduate students, undergraduate students, technicians, and IT managers Screening must include: subcontractors consultants international suppliers
Project Closeout Closeout procedures for destruction or returning of items to sponsor Post-award monitoring of award activity (adding personnel, change in SOW, etc.)
What Happens if we Break a Rule?
ITAR (Defense-related) Criminal Fines: up to $1M and 20 years in prison Civil Fines: up to $500K and Forfeitures Debarment/Loss of Federal Funding EAR/FACR (Dual-Use / Sanctions) Denial of export privileges Debarment Criminal Fines: up to $1M and 20 years in prison Civil Fines: up to $250K or 5X value of exports Penalties can apply to you (as an individual) and to the university! Penalties for Violations
ITAR Professor sentenced to 4 yrs in prison University currently under criminal investigation 1 CY08 university directed disclosure 10 CY09 university voluntary disclosures EAR University nearing settlement over EAR99 violations with Chinese entity Classified University currently under investigation for classified material spillage Enforcement Actions
Sentenced to 4 years in prison for “illegally exporting military technical information relating to plasma technology designed to be deployed on the wings of drones operating as a weapons or surveillance systems.” Evidence included exports of technical data to foreign national graduate students in his lab. Monday, October 3, 2011 – U.S. Supreme Court denied certiorari. J. Reece Roth Emeritus Professor of Electrical and Computer Engineering University of Tennessee
What else should we consider?
Shipping Any item valued at $2500 or greater may require an Electronic Export Information submission to the Bureau of Census Many items require export licenses or other government approvals to ship outside of the US Consult your Office of Research prior to shipping or taking UMSL property outside of the United States
Commerce and State have regulations that affect: Physically taking items with you on a trip such as Laptops Encryption products on your laptop Data/technology Blueprints, drawings, schematics Supplying certain technologies/data at a “closed” conference or meeting Note-taking not allowed Not open to all technically qualified members of the public Travel
The Office of Foreign Assets Control (OFAC) has regulations that affect: Money transactions and the exchange of goods and services in certain countries – providing “value” Travel to sanctioned countries Doing business with certain people or entities Commerce, State, and OFAC have “lists”
Travel A license could be required depending on what you are taking and the country you are traveling to A license or technical assistance agreement would be required if you were providing a “defense service” to a foreign person A defense service means the furnishing of assistance (including training) to a foreign person relative to a defense article. It also includes furnishing any technical data relative to a defense article. There are consequences if you violate the regulations!
Travel In most cases, if you need to work abroad, a license exception or exemption is available! EAR: “TMP” or “BAG” An exception/exemption is not needed if you are taking a “clean” laptop to countries other than Cuba, Syria, Iran, North Korea, or Sudan Items, software should be evaluated before travel Consider reviewing State Department advisories prior to travel for information on your destination.