1. Export controls & Partners Healthcare
Lisa Griffin, BWH
Rachel Ackman, MGH
September 29, 2015
Export controls & Partners Healthcare

2. Agenda What is an export? Regulations that restrict exports
Identifying when restrictions apply
Help from contracting language

3. What is an Export?
Any shipment or transmission of items, information, or technology outside of the United States.
This includes items that are shipped, carried over the border during travel, sent via electronic means, or shared in the course of spoken or written communication abroad.
Sending money and other financial support outside of the US can also be an export
Sharing information with foreign nationals in the United States is “deemed” to be exported to the foreign nationals country of origin.

4. Export Restrictions Export Administration Regulations (EAR)
Enforced by the Department of Commerce
Target items of US origin that could have a civilian and military use.
International Traffic in Arms Regulations (ITAR) and US Munitions List
Enforced by the State Department
Targets items with a direct military application
Trade Sanctions and Embargoes
Enforced by the Department of Treasury, Office of Foreign Asset Controls
Target financial transactions but can be broad enough to restrict any dealings with specific individuals or companied.

5. Export Administration Regulations
Restricts exports and “deemed” exports of dual use items, information, or technology
Specific items, information, and technology subject to these regulations are found on the commerce control list (CCL) and are classified as:
1 - Materials, Chemical, Microorganisms, and Toxins 2 - Materials Processing
3 - Electronics Computers
5 - Telecommunications and Information Security 6 - Sensors and Lasers
7 - Navigation and Avionics Marine
9 - Aerospace and Propulsion Nuclear and Miscellaneous
Inclusion on the CCL does not necessarily mean restrictions will apply, restrictions are also based on the export’s destination and the expected end user.
For example, smart phones are listed on the CCL but you can bring them to most countries without restriction.

6. International Traffic in Arms Regulations
Restrict the export of items and technology that have a direct military application:
Munitions - Goods and technology designed to cause or increase human casualities or defend against biological or chemical attacks in a military setting
Includes technical data related to defense services (furnishing assistance including design and use of defense articles)
Designed to protect national security and take precedence over other export regulations
Items and technology restricted under ITAR generally require a State Department license to export

7. Sanctions and Embargoes
Export restrictions that further a US foreign policy objective
Sanctions and Embargoes typically target finance and trade but can include travel and services. Broad sanctions can limit all dealings with a specific country, government, or specific foreign nationals.
Countries currently subject to US Sanctions are listed below:
Balkans, Belarus, Burma, Central African Republic, Cote d’Ivoire (Ivory Coast), Cuba, Democratic Republic of Congo, Iran, Iraq, Lebanon, Libya, North Korea, Somalia, Sudan, South Sudan, Syria, Ukraine/Russia, Yemen, Zimbabwe

8. Licensing
When export restrictions do apply, it is possible to obtain a license to engage in the activity from the agency enforcing the export regulations.
OFAC – US Treasury: obtaining an OFAC license is usually free but can take many months. The licenses typically last for 1 year and permit activities needed to carry out the licensed transaction.
Commerce Department – Licensing for exports restricted under the EAR can be expensive. They typically apply to a specific commodity and changes may require a new license. The Commerce Department will provide a free classification under the CCL which can be used to determine if a license is necessary.
State Department – Exporting an article under the ITAR requires registering as an exporter with the State Department and obtaining the appropriate license. These can be expensive and difficult to obtain.
License applications should be submitted through the Research Compliance Office.

9. License Exceptions Fundamental Research Tools of the Trade
Excludes information that will be or that can be shared publically by publication or presentation from certain licensing requirements.
Does not apply to the export of items, only information.
Contract clauses that limit the free publication of research results can defeat this exception.
Tools of the Trade
Allows US persons to export certain controlled items for use by that US person in the normal course of professional activity. Such use must be accepted for individuals in that profession.
Requires additional record keeping that may be required at customs.
Humanitarian Exceptions – several export control regulatory schemes include exceptions for humanitarian aid including food and medical supplies which are donated to areas in need.

10. We need your help Embargoed countries Contract language Red Flags
Flag transactions and notify entity Research Compliance Office
Contract language
Ensure language requiring vendor compliance with export controls appears in contracts
If you get pushback, notify entity Research Compliance Office
Red Flags
If you have any concerns about a transaction, notify entity Research Compliance Office

11. We need your help Pre Award Post Award Contract/subcontract Finance
Embargoed countries
Letter/Statement of Intent
Re-export
Post Award
Financial terms
Scope of Work
Contract/subcontract
Governing law, specific export control references
Publication
Finance
Invoicing
Payments

12. Determining if Export Restrictions Apply
Who – who will be receiving the export, a person, an institution? Will they export it to someone else?
What – what will be exported? Is it on the Commerce Control or Munitions Lists?
Where – where is the final destination of the export? Will it be sent to an embargoed country? Is it in a restrictive country group under the EAR?
Why – what is the reason for exporting the item or information? What will the recipient do with the export?
When – is this a temporary export, such as a piece of equipment brought on a trip, or will the item stay in the foreign country permanently?

13. Addressing Exports Contractually
Include standard language which clearly outlines responsibilities for compliance with export control regulations including obtaining necessary licenses. Where there is concern that export control regulations will be triggered due to the objective of the contract or the involvement of an embargoed country include a plan for compliance with the regulations. Be careful of language which limits the free dissemination of research results, as this may impact that availability of the Fundamental Research Exemption.

14. Standard Contract Language
The Parties agree that the export of any items, including but not limited to goods, materials, equipment, information and data, from the United States may require approval from the U.S. Government in accordance with all applicable export control laws and regulations. The Business certifies that it will not export or re-export any items in the course of its activities, or engage in any transactions, under this Agreement without first determining whether the activity requires approval from the U.S. Government, including the U.S. Department of Commerce, the U.S. Department of State, the U.S. Department of Treasury, and any other authority responsible for such matters. Further, the Business shall not engage in any transactions with persons or entities listed as specially designated nationals and/or blocked persons by the U.S. Treasury Department's Office of Foreign Assets Control, unless the need for a license or approval has been determined and such license or approval has been obtained. If federal approval or license is required for any of the Business’s activities contemplated under this Agreement, the Business shall be solely responsible for determining the need for and obtaining such approval or license. The Business certifies that it is solely responsible for any and all import certificates, fees, taxes, and any other applicable requirements, when importing an item into the U.S. or any other country in the course of its activities under this Agreement.

15. Entity Research Compliance and Export Controls Contacts
BWH: Lisa Griffin
(617) |
MGH: Rachel R. Ackman
(617)
McLean: Jen Mahoney |
Spaulding: Alisia Minasian |