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Export Control Provisions

On September 5, 1774, the First Continental Congress convened in Carpenter's Hall in Philadelphia and the following December the Congress declared the importation of British goods to be illegal. Twelve months later the Congress outlawed the export of goods to Great Britain, thus establishing the first American export controls. Since then, the United States has imposed export controls for a variety of reasons through legislation such as the Embargo Act, Trading with the Enemy Act, the Neutrality Act, and the Export Control Act.

Because unilateral export controls are less effective than controls enforced by many nations, the United States joined forces with other countries to help further its national security and foreign policy interest. Currently, the United States is a member of the Nuclear Suppliers Group, the Australia Group, the Missile Technology Control Regime, and the Wassenaar Arrangement.

The State Department Office of Defense Trade Controls, in accordance with Sections 38-40 of the Arms Export Control Act (AECA or 22 U.S.C. 2778) and the International Traffic in Arms Regulations (ITAR), controls the permanent and temporary export and temporary import of defense articles and defense services by taking final action on license applications and other requests for approval for defense trade exports and retransfers, and handling matters related to defense trade compliance, enforcement and reporting. The Office of Defense Trade Controls (DTC) and its modern day predecessors have administered control of international arms traffic since the 1930's. By law, all US manufacturers and exporters of commodities covered by the US Munitions List must register with the Department of State.

The history of US defense trade controls goes back to public concern over profiteering from armaments in the 1930s. The Neutrality Act of 1935 empowered the Secretary of State to set up an Office of Arms and Munitions Controls, with authority to register and issue export licenses to all US entities engaged in defense-related trade. Both the Mutual Security Act of 1954 and the Arms Export Control Act of 1976 elaborated and expanded the role of the Department of State. These laws, and Executive Orders affecting defense trade, form the authority and foundation of the Code of Federal Regulations (CFR), Title 22, Foreign Relations. The International Traffic in Arms Regulations (ITAR) includes Parts 120–130 of 22 CFR. One major element contained in the ITAR is the US Munitions List (USML) (22 C.F.R. § 121.1), the official list of the types of items controlled by the Department of State. Groups of items with similar uses form the “USML Categories.”

Any person who engages in the United States in the business of either manufacturing or exporting defense articles, defense services, or related technical data is required to register with the Office of Defense Trade Controls. Both manufacturers and exporters of US defense articles and related technical data and furnishers of defense services must register with the U.S. Department of State (ITAR Part 122). Manufacturers of defense articles that do not engage in exporting must nevertheless register. Persons engaged in exporting unclassified technical data are required to register. Registration is not required for persons all of whose manufacturing and export activities are licensed under the Atomic Energy Act of 1954, as amended. Registration is primarily a means to provide the US Government with necessary information on who is involved in certain manufacturing and exporting activities. Registration does not confer any export rights or privileges. It is a precondition to the issuance of any license or other approval for export. To export, a registrant must submit an export license application to the Office of Defense Trade Controls. Upon request DTC provides exporters with a determination of whether an item is under the licensing jurisdiction of the Department of State. The Commodity Jurisdiction (CJ) determination only determines the proper licensing authority for an item, and is not an approval to export.

The Export Control Act of 1949 gave the US Department of Commerce Bureau of Export Administration primary responsibility for administering and enforcing export controls on dual-use items, and for the first time defined three reasons for the imposition of these controls - national security, foreign policy, and short supply. Upon the expiration of the Export Control Act, the Export Administration Act (EAA) of 1969 took effect on January 1, 1970. The EAA was reestablished in 1979, and amended several times since. The Act lapsed on August 20, 1994. The Department of Commerce is currently acting under the authority conferred by Executive Order No. 12924 of August 19, 1994. In the Executive Order, the President invoked his authority, including authority under the International Emergency Economic Powers Act, to continue in effect the system of controls that the United States had maintained under the Act. Controls also are maintained for purposes of nuclear non-proliferation under the Nuclear Non-Proliferation Act of 1978. Presently, the EAA is in the process of being rewritten.

The Export Administration Regulations (EAR) are contained in 15 CFR chapter VII, subchapter C. The EAR are issued by the United States Department of Commerce, Bureau of Export Administration (BXA) under laws relating to the control of certain exports, reexports, and activities. In addition, the EAR implement antiboycott law provisions requiring regulations to prohibit specified conduct by United States persons that has the effect of furthering or supporting boycotts fostered or imposed by a country against a country friendly to United States.

The export control provisions of the EAR are intended to serve the national security, foreign policy, nonproliferation, and short supply interests of the United States and, in some cases, to carry out its international obligations. Some controls are designed to restrict access to dual use items by countries or persons that might apply such items to uses inimical to U.S. interests. These include controls designed to stem the proliferation of weapons of mass destruction and controls designed to limit the military and terrorism support capability of certain countries. The EAR also include some export controls to protect the United States from the adverse impact of the unrestricted export of commodities in short supply.

In recent years the Clinton Administration has made major progress in eliminating unnecessary and ineffective export controls and streamlining the export control process. It has simultaneously strengthened the implementation and enforcement of those export controls which are still required to combat proliferation and protect other U.S. national security and foreign policy interests. Since 1993, the value of goods requiring a license has decreased from $6.1 billion per quarter to $2.7 billion per quarter at the end of FY1995.

On March 25, 1996, the Federal Register published an interim rule simplifying the EAR. This is the first comprehensive rewrite of the Export Administration Regulations (EAR) in over 40 years. This interim rule clarified the language of the EAR, simplified their application, and generally made the export control regulatory regime more user-friendly.

The Defense Technology Security Administration (DTSA) provides the direction and stewardship for the technology security policies and programs of the U.S. Department of Defense (DoD). DTSA makes recommendations to the Department of State on license applications for the export of defense articles and services under the International Traffic in Arms Regulations, and to the Department of Commerce on license applications for the export of sensitive dual-use goods and technologies under the Export Administration Regulations. DTSA does not issue export licenses, and is not a regulatory agency. DTSA has established procedures whereby applicants address DoD concerns with their license application prior to DTSA forwarding a final DoD recommendation to State or Commerce.

The Office of Foreign Assets Control of the U.S. Department of the Treasury administers and enforces economic and trade sanctions against targeted foreign countries, terrorism sponsoring organizations and international narcotics traffickers based on U.S. foreign policy and national security goals. OFAC acts under Presidential wartime and national emergency powers, as well as authority granted by specific legislation, to impose controls on transactions and freeze foreign assets under U.S. jurisdiction. Many of the sanctions are based on United Nations and other international mandates, are multilateral in scope, and involve close cooperation with allied governments.

Under the Atomic Energy Act of 1954, as amended, the Nuclear Regulatory Comission [NRC] is responsible for licensing the export and import of nuclear-related materials and equipment to ensure these items are used for peaceful purposes and will not be inimical to the United States. This authority extends to nuclear reactors and other fuel cycle facilities and equipment, to source and special nuclear material, to byproduct materials, and to certain other commodities, including radioactive waste. The NRC obtains the views and recommendations of other governmental agencies and departments in its pre-licensing reviews, and, in turn, provides its views and recommendations to the Departments of Energy and Commerce on nuclear-related export authorizations under their jurisdiction. By virtue of its role in licensing exports of nuclear-related materials and equipment, the NRC plays an important role in the development and implementation of US and international export control regimes through the Nuclear Nonproliferation Treaty (NPT) Exporters Committee (the "Zangger Committee") and the Nuclear Suppliers Group (NSG), whose guidelines set the international standard for nuclear cooperation and supply.

The Department of Energy, Office of Arms Controls and Nonproliferation, Export Control Division licenses nuclear technology and technical data for nuclear power and special nuclear materials.

MCTL: Militarily Critical Technologies List

The Militarily Critical Technologies List (MCTL), which is revised each year to reflect changes in technologies and the world environment, is the Defense Department’s best guess as to what technologies and equipment must be protected from unauthorized export. These technologies are perceived as providing the key to maintaining US military superiority. The MCTL provides the foundation for US proposals on export control regulations and serves as a technical reference for licensing and export control by Customs, and the Departments of State, Defense, Commerce, and Energy. The MCTL itself, however, is not an export control list, but provides guidance in the development of such lists. Items may be in the MCTL that are not export controlled and vice versa.

The MCTL was first produced in 1981, and then in 1982, 1983, 1984, 1986, 1989, and 1992. Decisions about candidate technologies are made by technology working groups, experts from business, the government, and academia. The Institute for Defense Analyses has been responsible for the production of the final lists.

Currently the MCTL is divided into three parts — Parts One and Two deal with weapon system technologies and weapons of mass destruction, while Part Three is Critical Development Technologies (CDT). The latter consists of a list of technologies, which when fully developed are anticipated to provide superior military performance or maintain superior performance more affordably. Among the technologies described are aeronautic systems; chemical and biological system technology; directed and kinetic energy systems; electronics; ground systems; guidance, navigation and vehicle control; information systems; information warfare; manufacturing and fabrication; advanced materials; marine systems; nuclear systems; sensors and lasers; signature control; space systems; and weapons effects and countermeasures.

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