Legal Issues and Export Controls Career-Ending Opportunities and Ways to Get Fitted for an Orange Jumpsuit David Lombard Harrison, Associate Vice President for Legal Affairs The University of North Carolina General Administration

Export Controls Compliance 2 Export Controls - Definition Federal laws that regulate the distribution of strategically important, Products, services, and information to, Foreign nationals and foreign countries, For foreign policy and national security reasons.

Export Controls Compliance 3 Agencies and Regulations U.S. Department of Commerce through its Export Administration Regulations. EAR—trade and dual-use protection.

Export Controls Compliance 4 Agencies and Regulations U.S. Department of State through its International Traffic in Arms Regulations. ITAR—national security.

Export Controls Compliance 5 Agencies and Regulations U.S. Department of Treasury through its Office of Foreign Assets Control. OFAC—trade embargoes.

Export Controls Compliance 6 Increased Attention to Export Controls Recent heightened concerns about national and homeland security, Proliferation of weapons of mass destruction, Terrorism, Leaks of technology to U.S. economic competitors.

Export Controls Compliance 7 Higher Education Balancing concerns about national security and U.S. economic vitality with traditional concepts of unrestricted academic freedom, publication, and dissemination of research findings and results.

Export Controls Compliance 8 Application and Subjects The EAR and ITAR apply to the transfer of specific physical items and information and the provision of specific services to persons and entities. OFAC prohibits transactions with countries, entities, and individuals subject to boycotts, trade sanctions, and embargoes.

Export Controls Compliance 9 Violations and Penalties Criminal penalties (including fines and/or prison sentences for individuals) and civil sanctions. May affect future research opportunities. Fines of up to $1,000,000. Prison sentences up to 10 years.

Export Controls Compliance 10 Exports – Actual and Deemed “Actual Export.” Technology and information leaving the shores of the United States. “Deemed Export.” Transmitting the technology or information within the United States to an individual other than a U.S. citizen or permanent resident.

Export Controls Compliance 11 Comparison of EAR and ITAR The EAR is concerned with “dual use” items; ITAR with those that are inherently military in nature. The ITAR contains the concept of “defense services,” which includes the furnishing of either training or of technical data related to ITAR-controlled items to foreign persons either in the U.S. or abroad.

Export Controls Compliance 12 Office of Foreign Assets Control Enforces economic and trade sanctions based on U.S. foreign policy and national security goals. Targets foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction. Prohibits transactions with Specially Designated Nationals and Blocked Persons.

Export Controls Compliance 13 Fundamental Research When the fundamental research exemption applies, research may be conducted with the participation of foreign nationals, and research information and results may be disseminated inside or outside the United States.

Export Controls Compliance 14 Fundamental Research Fundamental Research means basic or applied research in science and engineering performed or conducted at an accredited institution of higher learning in the United States where the resulting information is ordinarily published and shared broadly in the scientific community.

Export Controls Compliance 15 Fundamental Research Fundamental research is distinguished from research that results in information that is restricted for proprietary reasons or national security reasons (EAR) or pursuant to specific U.S. government access and dissemination controls (ITAR).

Export Controls Compliance 16 Limits of Fundamental Research Exemption The fundamental research and public domain exemptions apply only to disclosure to foreign nationals in the U.S. of information or technical data.

Export Controls Compliance 17 Limits of Fundamental Research Exemption Does not apply to shipment outside U.S. borders of things (physical items) or services (e.g., training foreign nationals inside or outside the United States).

Export Controls Compliance 18 Teaching Exemption Authorizes the disclosure of educational information released by instruction in catalog courses or general scientific, mathematical, or engineering principles commonly taught in colleges and universities without a license from the Department of Commerce or State (EAR 734.9:ITAR (5)).

Export Controls Compliance 19 Authority Export control regulations are federal law. Do not rely on contract, grant, or other agreement terms to tell you whether the export regulations will apply.

Export Controls Compliance 20 Summary – Fundamental Research Fundamental research is basic and applied research in science and technology, performed by U.S. institutions of higher education, the results of which will be shared widely within the interested community.

Export Controls Compliance 21 Summary – Exporting Fundamental Research The transfer abroad (“export”) of fundamental research proceeds under different rules. Generally requires a license if no other exemption, exception, or exclusion is available.