ITAR COMPLIANCE TRAINING

Is It ITAR? Practical Tips for Submitting Commodity Jurisdiction Requests

When instituting any export compliance program, the first step is classification. Is this item controlled by the International Traffic In Arms Regulations (“ITAR”) implemented by the State Department or by the Export Administration Regulations (“EAR”) implemented by the Commerce Department? The consequences of classification under these two sets of regulations are vastly different and, therefore, proper classification is essential. Generally, manufacturers can easily make their own jurisdictional determinations, but gray areas often arise where official government classifications become necessary. Drafting and submitting an effective CJ request, however, is as much of an art as it is a science. Here are some practical tips when drafting and submitting CJ requests:

Submit the CJ request to the State Department: Although both the State and the Commerce Departments offer official classification determinations, the State Department is the authority for regulating defense articles and defense services. Any questions regarding ITAR jurisdiction should be directed in the first instance to the State Department.

Follow the guidelines: The State Department recently updated its CJ request guidelines, which can be found at: http://www.pmddtc.state.gov/commodity_jurisdiction/documents/cj_guidelines.pdf. Following the guidelines sounds simple enough, but many companies make the mistake of focusing intently on the technical intricacies of their submission, and forget many of the basics, such as: the proper subject line, explaining current uses, or submitting nine complete sets. DDTC might draw an impression of the Company from these basic errors.

One product = one CJ request: If the company seeks to submit a CJ request for a category of products, it is recommended to contact the DDTC Response Team and verify that a category-type submission is appropriate (otherwise, the company risks spending effort on a CJ only to have the DDTC return it without action).

Allow for plenty of time: The guidelines suggest it can take up to 65 business days (over three months) to complete a CJ request—and that assumes that the company submitted everything properly and no other issues arose. In some instances, it can take 90 to 100 days (or longer) to complete.

Frame your product: Explain your product simply and in plain English before diving into the details. A company should objectively, but persuasively, demonstrate why the company—in good faith—believes the item is not ITAR. Although you are allowed to resubmit a CJ request following a negative determination, you must have rationale for the change and, typically, new information that would change its prior classification. Therefore, it is important to frame it correctly the first time.

Provide enough detail, but not too much: It is important to address all potential questions or concerns, however, a CJ request should not overwhelm DDTC with too much, and often unnecessary, information.

Follow-up: Regularly communicate with the Response Team to determine the status of the CJ request and to address any questions, especially if it is “red-flag” technology (e.g., night-vision related, unmanned aerial vehicles, etc.).

Keep Records Indefinitely: Although the general rule is that an exporter must keep its records for five years, this does not apply to CJ requests. CJ requests are not binding and DDTC may review the product at issue many years later. Therefore, it is important to keep all records regarding CJ requests.