1. What are Export Controls? A comprehensive series of regulations enforced by the Federal Government that regulate the distribution of certain exports to foreign nationals and foreign countries Have been in existence in one form or another since the 1940s Export control laws apply to all activities – not just sponsored research projects Control involves obtaining a license from the federal government prior to exporting 1 ORA/Protections and Compliance http://www.umbc.edu/research/

2. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 2 ORA/Protections and Compliance http://www.umbc.edu/research/

3. Why is this important? Protect National Security & US foreign obligations Combat Terrorism Prevent spread of weapons of mass destruction (nuclear, chemical, biological, missiles, etc) Avoid harm to UMBC’s reputation and adverse publicity 3 ORA/Protections and Compliance http://www.umbc.edu/research/

4. Why - Liability and Violations Individual & institutional penalties: Large fines & jail time ($500K Civil & $1M Criminal) Multiple violations/finding for same occurrence Not just you - Could result in UMBC wide: All settlements public Draconian compliance and reporting Loss of export privileges (exporting is not a right) Adverse impact on federal awards 4 ORA/Protections and Compliance http://www.umbc.edu/research/

5. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 5 ORA/Protections and Compliance http://www.umbc.edu/research/

6. Basics What are Export Controls? US laws that regulate the distribution to foreign nationals and foreign countries strategically important technology, services and information for reasons of foreign policy and national security. 6 ORA/Protections and Compliance http://www.umbc.edu/research/

7. Basics What is an Export? Transfer of Controlled: Technology Software InformationSource Code Equipment Services (ITAR) To: –Anyone, including U.S. citizens outside the U.S. –A non-U.S. entity or individual, wherever located (Deemed export ) By Any Means: –Actual shipment outside the US –Visual inspection in or outside the US – FAX – PHONE – EMAIL – FACE to FACE – Tours of labs – Training sessions – Computer data 7 ORA/Protections and Compliance http://www.umbc.edu/research/

8. 8 Basics What is a “Deemed” Export? The transfer, release or disclosure of Technical Data or Technology to a foreign national within the United States (includes university campuses). A transfer is the same as exporting it to the home country of foreign national. ORA/Protections and Compliance http://www.umbc.edu/research/

9. 9 Basics Who are U.S. Persons? –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 provision –Any entity incorporated to do business in the U.S. ORA/Protections and Compliance http://www.umbc.edu/research/

10. 10 Basics Who are Foreign Persons? Everyone else: Any foreign interest or any US Person effectively owned or controlled by a foreign interest –Includes foreign businesses not incorporated in the U.S., persons representing other Foreign Persons, any foreign government –Includes: H1B 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 - instead it refers to “foreign national”- they mean the same thing ORA/Protections and Compliance http://www.umbc.edu/research/

11. Basics - Application 11 Applies to following UMBC areas: * Research* Purchasing * MTA, CDA, LA* Human Resources * Shipping* Visiting Faculty – Foreign Nationals * Foreign Travel* International Education * Foreign Students Export control laws apply to all activities – not just sponsored research projects Your award does not have to cite the regulations for export controls to apply ORA/Protections and Compliance http://www.umbc.edu/research/

12. Basics Who Controls Exports & Sanctions? US Dept of Commerce* US Dept of Energy US Dept of Homeland Security US Dept of Justice US Dept of State* US Dept of Treasury* * Focus of this presentation 12 ORA/Protections and Compliance http://www.umbc.edu/research/

13. Basics - Most Common US Agencies Department of Commerce Export Admin Regulations (EAR) Trade Protection Regulates commercial goods & Services with potential military application (Dual Use) Commerce Control List (CCL) Bureau of Industry and Security (BIS) Department of State Department of Treasury International Traffic in Arms Regulations (ITAR) Office of Foreign Assets Control (OFAC) Directorate of Defense Trade Controls (DDTC) National Security Export of articles, services & related technical data that are military in nature US Munitions List (USML) Sanctions against: Foreign Countries & Gov Terrorists, Narcotics, War Criminals, Weapons Proliferators Trade Embargos ORA/Protections and Compliance http://www.umbc.edu/research/

14. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 14 ORA/Protections and Compliance http://www.umbc.edu/research/

15. Terms Dept of Commerce EAR ( 15 CFR §§734-774) – Export Administration Regulations cover commodities, technology & software. * Shipment or transmission out of the US * Release to a foreign national in the US. Release of export-controlled technology and source code can also occur through transmission via e- mails, faxes, designs, and verbal correspondence. 15 ORA/Protections and Compliance http://www.umbc.edu/research/

16. Terms EAR – Commerce Control List Categories Category 0 - Nuclear Materials, Facilities & Equipment (and Miscellaneous Items) Category 1 - Materials, Chemicals, Microorganisms, and Toxins Category 2 - Materials Processing Category 3 – Electronics Category 4 – Computers Category 5 (Part 1) – Telecommunications Category 5 (Part 2) - Information Security Category 6 - Sensors and Lasers Category 7 - Navigation and Avionics Category 8 – Marine Category 9 - Propulsion Systems, Space Vehicles and Related Equipment 16 ORA/Protections and Compliance http://www.umbc.edu/research/

17. Terms EAR – Application Listed items are subject to EAR but only some require prior U.S. government approval. Depends on Key Questions: What material, technology, data, or software? Who is participating in the research (different standards for different countries and foreign nationals)? Where is the destination of the export (country, institution, and individual)? What is the intended or suspected end use or end-user, plus any reasonably foreseeable re-export? Do any exclusion or exemptions apply? 17 ORA/Protections and Compliance http://www.umbc.edu/research/

18. Terms Dept of State ITAR (22 CFR Parts 120-130) – International Traffic in Arms Regulations cover military articles, services and related technical data Prior Authorization required for: –Sending or taking out of the U.S. in any manner –Disclosing (including oral or visual disclosure) –Transferring to a foreign person, whether in the U.S. or abroad. –Performing a defense service on behalf of, or for the benefit of, a foreign person, whether in the U.S. or abroad. Certain information may be controlled even if in public domain – Defense Services. 18 ORA/Protections and Compliance http://www.umbc.edu/research/

19. Terms ITAR Munitions List 121.3 Aircraft and related articles 121.4 Amphibious vehicles 121.5 Apparatus and devices under Category IV(c) 121.6 Cartridge and shell casings 121.7 Chemical agents 121.8 End-items, components, accessories, attachments, parts, firmware, software and systems 121.9 Firearms 121.10 Forgings, castings and machined bodies 121.11 Military demolition blocks and blasting caps 121.12 Military explosives and propellants 121.13 Military fuel thickeners. 121.15 Vessels of war and special naval equipment. 121.16 Missile Technology Control Regime Annex. 19 ORA/Protections and Compliance http://www.umbc.edu/research/

20. Terms Dept of Treasury OFAC ( 31 CFR 500-599) : The Office of Foreign Assets Control regulations are based on US foreign policy and national security goals. They cover economic and trade sanctions against targeted foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction. 20 ORA/Protections and Compliance http://www.umbc.edu/research/

21. Terms OFAC Application OFAC license required for services to or from: –Countries, entities, or individuals Covers Sanctions and Embargos May apply when ITAR & EAR do not Multiple lists must be checked (applies to entities and individuals even if their country is not listed) Covers some practices (ie proliferation of WMD or diamond trading) Restrictions vary by country Some exemptions apply for academic collaboration 21 ORA/Protections and Compliance http://www.umbc.edu/research/

22. Terms OFAC Application Prohibits: –Travel to embargoed countries (Cuba, Iran, North Korea, Sudan, Syria) –Sanctions against Countries, Entities, Individuals Research, field-work, or instruction Surveys or interviews Trade – Importing merchandise Furnishing anything of value (ie materials, payments, services, honoraria, training) Collaborating, presenting or training 22 ORA/Protections and Compliance http://www.umbc.edu/research/

23. Terms OFAC Application Prohibits ( Cont’d ): Creating new information materials at the behest of persons in a sanctioned country Providing educational, marketing & business service to persons in sanctioned countries Engaging in services of persons in a sanctioned country to develop new information materials 23 ORA/Protections and Compliance http://www.umbc.edu/research/

24. Terms EAR & ITAR End User Controls/Prohibitions Separate from USML & CCL, ITAR & EAR prohibit exports to, or export collaborations with, certain designated entities or countries identified as export violators both in and outside the U.S. So, CCL and USML may say no license is required in general, but you need to also check their lists to determine if more stringent restrictions apply to the entity or country –Don’t be fooled by their “Academic” names (Beihang University, SW Institute of Env Testing, Chinese Academy of Engineering Physics). 24 ORA/Protections and Compliance http://www.umbc.edu/research/

25. Terms Their “Lists” Denied Persons List (BIS) Unverified List (BIS) Entity List (BIS) Specially Designated Nationals List (OFAC) Debarred List (DDTC) Nonproliferation Sanctions (DDTC) 25 ORA/Protections and Compliance http://www.umbc.edu/research/

26. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 26 ORA/Protections and Compliance http://www.umbc.edu/research/

27. Types of Exclusions and Exemptions Exclusion – Outside the regulations not subject to the regulations Exemption - License not required for item or activity as defined within the regulations Public Domain Exclusion (ITAR,EAR,OFAC) Fundamental Research Exclusion (ITAR, EAR) Education Exclusion (ITAR, EAR) License Exception TMP (Temporary Exports) Full-Time Employee Exemption (ITAR) Must be used correctly; failure may result in an export control violation 27 ORA/Protections and Compliance http://www.umbc.edu/research/

28. Public Domain Exclusion (22 CFR 120.11, 125.1; 15 CFR 734..7) You stay outside the regulations when you share technical data or information with foreign person inside or outside of US if: –It has already been published; –Available in libraries or through newsstands, bookstores, subscriptions, or free websites; or –Disclosed in published patent applications Except If: –Equipment or encrypted software –Reasonably believe used as WMD –Sponsor restrictions 28 ORA/Protections and Compliance http://www.umbc.edu/research/

29. Fundamental Research Exclusion (FRE) NSD 189, 22 CFR 120.11 (a)(8), 125.1; 15 CFR 734.8, 734.11 You stay outside the regulations when: –Disclosing to foreign persons information (not items) –Resulting from “basic and applied” research in science and engineering –At an accredited institution of higher learning –In the U.S. –Where the resulting information is “ordinarily published and shared broadly in the scientific community.” 29 ORA/Protections and Compliance http://www.umbc.edu/research/

30. Fundamental Research NSD 189, 22 CFR 120.11 (a)(8), 125.1; 15 CFR 734.8, 734.11 Basic or applied research at an accredited US institution of higher learning No publication restrictions If federally funded, no access and dissemination restrictions on results No national security restrictions 30 ORA/Protections and Compliance http://www.umbc.edu/research/ As long as the above conditions are met, the “results” of your research are not subject to ITAR/EAR license restrictions even if the subject area of the research is export restricted

31. Fundamental Research Exclusion (FRE) Does not apply to: –Technology, software, or items that are already designated or identified as proprietary or subject to export controls –Defense Articles or Defense Services (ie training) Dept of State guidance requires that an export license be obtained for a foreign person…who is to have access to a defense article in the U.S. Dept of State considers all such access to be a Defense Service 31 ORA/Protections and Compliance http://www.umbc.edu/research/

32. Fundamental Research Exclusion (FRE) Does not apply to Development ( no longer basic or applied research ): Design, development, testing, or evaluation of a potential new product or service (or of an improvement in an existing product or service) to meet specific performance requirements or objectives. 32 ORA/Protections and Compliance http://www.umbc.edu/research/

33. Fundamental Research Exclusion (FRE) Does not apply to: –Information or Software generated outside the U.S. if ITAR –Some research subject areas, like: Weapons of Mass Destruction (WMDs) Encryption software or source code Items or technologies controlled specifically by another agency (ie Nuclear Regulatory Agency) 33 ORA/Protections and Compliance http://www.umbc.edu/research/

34. Fundamental Research Exclusion (FRE) Destroyed by any clause (regardless of sponsor) that: –Gives sponsor right to approve publications resulting from the research –Restricts the access and dissemination of results to foreign nationals –Otherwise operates to restrict participation in research and/or access to and disclosure of research results 34 ORA/Protections and Compliance http://www.umbc.edu/research/

35. Fundamental Research Exclusion (FRE) Is vulnerable to: –“Side deals” between a PI and sponsor as they could destroy UMBC’s fundamental research exclusion and may also violate institutional policies on openness in research These could take place through a nondisclosure or confidentiality agreement signed by the PI Or, through acceptance of export-controlled information from others 35 ORA/Protections and Compliance http://www.umbc.edu/research/

36. 36 Educational Exclusion As a general rule, no license is needed for classroom/lab teaching of foreign nationals registered for classes in U.S. universities. ITAR – Export Controls do not apply to information concerning “general scientific, mathematical or engineering principles commonly taught in schools, colleges and universities.” (22 CFR 120.11) EAR – Export Controls do not apply to “educational information” released by instruction in catalog courses & associated teaching laboratories. 15 CFR 734.9 –The exclusion includes courses available globally on-line (“distance learning”) –But does not include OFAC-embargoed countries –Does not apply to encrypted software Foreign students using controlled equipment to conduct research should be registered for a research credit class. Same information transferred to a foreign national outside class may require a license ORA/Protections and Compliance http://www.umbc.edu/research/

37. License Exception/Temporary Exports (Tools of the Trade) ( EAR ) Applies to usual and reasonable kinds/quantities of tools (commodities/software) used by UMBC “Tools of the Trade”. UMBC employees (US Citizens) can ship or hand carry under a fundamental research project or educational activities but must remain under effective control (physical possession, or locked in safe) during travel. Excluding countries under sanction, faculty who wish to take their laptops out of the country to use in a project that qualifies as fundamental research may be able to do so under the license exception for temporary export (TMP) if the laptop meets the requirement for "tools of trade" and faculty retain control of the laptop at all times.(15 CFR Part 740.9). Does not apply to E:2 (Cuba) or Sudan It will be returned to the U.S. within 12 months or will be consumed/destroyed abroad 37 ORA/Protections and Compliance http://www.umbc.edu/research/

38. 38 Full-Time Employee Exemption (ITAR) UMBC exemption for disclosure in the U.S. of unclassified technical data to foreign nationals if: –Bona-fide, full time UMBC employee (confirm with HR, but post- docs, students and visiting scientists do not normally qualify) –Employee must have permanent US residence through period of employment (confirm visa allows) –Employee is not a national of a country to which export are prohibited (embargoed country) –UMBC must notify the employee in writing that the technical data may not be transferred to other foreign persons without the prior written approval of the government. ORA/Protections and Compliance http://www.umbc.edu/research/

39. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 39 ORA/Protections and Compliance http://www.umbc.edu/research/

40. Areas of Concern Definition of “Equipment Use”: –(ITAR) Operation, design, development, production, manufacture, assembly, repair, testing, maintenance or modification of defense articles –(EAR) Operation, installation (including on- site installation), maintenance (checking), repair, overhaul and refurbishing 40 ORA/Protections and Compliance http://www.umbc.edu/research/

41. Areas of Concern Equipment Use: –Generally, use of EAR export controlled equipment is not a deemed export. Deemed export occurs only if the controlled technology is transferred. –There are no exclusions allowing foreign persons to use equipment controlled for “use technology” which requires the access to the company/manufacturers proprietary manual or instructions for the use. 41 ORA/Protections and Compliance http://www.umbc.edu/research/

42. Areas of Concern  Shipping equipment to a foreign country  A license is required to ship if controlled by ITAR to any foreign country (few exemptions).  A license may be required to ship equipment controlled under the EAR out of the US depending on what the equipment is, where it is being sent, who will be using, and for what purpose (many exceptions)  Process to classify equipment and obtain a license under EAR may take several months  There is a presumption under OFAC that any and all shipments of equipment and provision of services to countries under sanction or persons in those countries are ILLEGAL.  Collaborating with foreign colleagues in foreign countries  Teaching foreign persons how to use items in research (“Defense Service”)  Controlled software use in classes 42 ORA/Protections and Compliance http://www.umbc.edu/research/

43. 43 Areas of Concern Sponsor publication approval or foreign national restrictions Contracts with DoD, NASA, DHS, Intel Agencies Proprietary technology research with industry or government Accepting another party’s proprietary information International sponsors, subcontractors 43 ORA/Protections and Compliance http://www.umbc.edu/research/

44. 44 Areas of Concern Non-sponsored research at university Collaborating with a country subject to US sanctions Projects in your garage Attending “closed” mtgs & conferences DD2345 Faculty start-up companies (no FRE) Providing services (not research) Protecting students Consulting work MTA’s and NDA’s 44 http://www.umbc.edu/research/

45. Areas of Concern - Penalties 45 ORA/Protections and Compliance http://www.umbc.edu/research/ ITAREAROFACCriminal Up to $ 1 million for a university or company Up to $1 million per violation for individuals and/or up to 10 years in prison Civil violations Up to $500,000 / violation for individuals, a university or company Seizure of articles Revocation of exporting privilegesCriminal Up to $1 million for a university or company Up to $250,000 / violation for individuals and/or up to 10 years in prisonCivil Loss of export privileges Up to $12,000 / violation for individuals, a university or companyCriminal Maximum fine of $100,000 for individuals and/or 10 years imprisonment Maximum fine of $1 million for a university or companyCivil Maximum fine of $55,000 / violation Violations of specific sanctions may add additional penalties

46. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 46 ORA/Protections and Compliance http://www.umbc.edu/research/

47. UMBC’s EC Management System Sponsored Programs –Export Control Flow Chart and Questionnaire created –Questions are being added to Routing sheet –Practical EC training UMBC Community –Created EC information web site (found at http://www.umbc.edu/research/ORPC/_ http://www.umbc.edu/research/ORPC/ –Established EC Official - Dean Drake –Established Legal Support – Dave Gleason –Execute EC Policy – Draft routed –Outreach and training program Schedule times at College faculty meetings Add EC component to DRATT and PI training On agenda for Departmental Mtgs (BRA, RAG, etc) 47 ORA/Protections and Compliance http://www.umbc.edu/research/

48. UMBC’s EC Management System Work with key areas outside of research -Travel, Shipping, Procurement, ESH, IT, HR, Academic Affairs Shows due-diligence on our part Will help protect academic freedom and exclusions 48 ORA/Protections and Compliance http://www.umbc.edu/research/

49. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC Case Studies 49 ORA/Protections and Compliance http://www.umbc.edu/research/

50. Export Controls – Case Study I am a researcher at UMBC. I am only conducting research on campus with students and other faculty and don’t plan to ship anything outside the United States. Do export controls affect me? Yes. An "export" also includes furnishing technical data to foreign persons or releasing technology or software to foreign nationals within the US and abroad. These types of exports are called "deemed exports" because the regulations deem them to be the equivalent of sending the same items (commodities, software, technology, technical data, defense articles, services) to the foreign national’s home country. Deemed exports can occur even when providing technical data in the form of graphs, specifications, or other technical information to a foreign student working in your lab. Whether it is a deemed export depends on whether the items provided is subject to and listed on the CCL or is considered technical data under ITAR. 50 ORA/Protections and Compliance http://www.umbc.edu/research/

51. Export Controls - Case Study I will be traveling to China to do research work with my collaborator, who is a faculty member at a university in Beijing. I will be providing her with my research results from my studies at UMBC but also undergoing further research at her lab. Do I need to be concerned about export controls? Yes. Your research results produced at UMBC are considered fundamental research results and fall under the fundamental research exclusion. However, information resulting from your research efforts in China does not fall within this exclusion from the export control regulations. Any transfer of controlled information to a foreign national, whether here or abroad, is considered an export and may require a license. Please check the CCL and USML to see whether your research in China will involve controlled technology, information or software. If so, please contact the Office of Research Protections and Compliance to determine what your next step is in order to undergo the collaboration. 51 ORA/Protections and Compliance http://www.umbc.edu/research/

52. Export Controls – Case Study I, along with another colleague, have received a request to provide peer review guidance to Professor K at the University of Tehran, whom both of us know well from international conferences. His work is strictly civilian and would not appear to have any connection to Iran’s government or military establishment. While I am a U.S. citizen, my colleague is a British citizen living in the U.S., though originally from Iran. He visits Iran occasionally on personal matters, and mentions that Professor K is interested in strengthening his ties to UC for professional and personal reasons. Can we provide the peer review? Potentially, not without an OFAC license. As a U.S. citizen subject to the OFAC rules, providing a peer review may constitute a service to Iran and is therefore prohibited without an OFAC license. The fact that you are not receiving compensation for the assistance or the Iranian professor’s work is purely civilian does not matter for purposes of the Iranian embargo regulation. While it is possible OFAC might grant such a license, this cannot be assumed. As to your British colleague, the fact he is living in the U.S. likely renders him subject to the same restriction. 52 ORA/Protections and Compliance http://www.umbc.edu/research/

53. Export Controls – Case Study I teach a grad course in the design and manufacture of very high- speed integrated circuitry. Many of the students are foreigners. Do I need a license to teach this course? What if the students were from countries that require a license? What if I talked about yet unpublished results? 53 ORA/Protections and Compliance http://www.umbc.edu/research/ No. The release of information by instruction in catalog courses and associated teaching laboratories of academic institutions is not subject to EAR. Even if one of the students was from a restricted country, or you talked about unpublished results from your research lab.

54. Export Controls – Case Study I have expertise in design and creation of submicron devices. I have been asked to be a consultant for a “third-world” company that wishes to manufacture such devices. Do I need a license? 54 ORA/Protections and Compliance http://www.umbc.edu/research/ Quite possibly. Applications abroad of personal knowledge or technical experience acquired in the US constitutes an export of that knowledge and experience and is subject to EAR. If any part of the knowledge or experience your export or re-export deals with technology that is listed under the CCL you may need a license. Note: As a consultant you are outside the university.

55. Export Controls Why? Basics Terms Exclusions and Exemptions Areas of Concern UMBC Management of EC 55 ORA/Protections and Compliance http://www.umbc.edu/research/

56. 56 www.umbc.edu/research/ORPC Export Control Management Contact: Dean Drake DDrake@UMBC.EDU 410-455-5642 Questions? ORA/Protections and Compliance http://www.umbc.edu/research/