The Good, the Bad, and the Itar: Helpful Hacks to Prevent an ITAR Screwup at Your Company

By Glenn Ishikawa

This book is purposefully void of any actual export regulations. The book simply aims to provide export control awareness and helpful tips across the board for any company and any person in the aerospace and defense industry to mitigate chances of export violations. This simple and fun read, which uses occasional pop culture references to drive home a point, will attempt to not only explain not only why export controls exist but also ingrain the philosophy of ITAR controls in everyone’s mindset for it to be a seamless part of your work landscape. It provides a macro view on those sensitive and possibly exposed areas for you to reevaluate and better protect your technologies and hardware from unauthorized access. This book is not an internal control plan for your company but may provide ideas to help identify and turn over some compliance stones previously left unturned. The goal is to increase export intelligence to all employees of a company manufacturing export-controlled commodities and to prevent that dreaded and soul-sucking export violation.

• Language: English
• Publisher: Xlibris US
• Release date: Aug 1, 2022
• ISBN: 9781669839064

Book preview

Copyright © 2022 by Glenn Coco Ishikawa.

All rights reserved. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without permission in writing from the copyright owner.

Any people depicted in stock imagery provided by Getty Images are models, and such images are being used for illustrative purposes only.

Certain stock imagery © Getty Images.

Rev. date: 07/28/2022

Xlibris

844-714-8691

www.Xlibris.com

841683

CONTENTS

1 For Whom This Book Is Written

2 The Basic Export Control Framework

ITAR Is Number 1

EAR Is Number 2

Export Control Classification Number

Dual Use

Registering with the DDTC

Emerging and Foundational Technologies

3 They Don’t Teach ITAR in Schools

What Schools and the Government Do Not Teach You

4 The Role of an ECA

5 The Standard ECA Response: It Depends!

6 Protecting ITAR Hardware from Visual Access

Models, Mock-ups, and Prototypes

7 Protecting ITAR Data

Partial Export-Controlled Dataset vs. Complete Dataset

8 When Technical Data Is Not Export Controlled

9 Sending a Request for Quote/Proposal to a Foreign Supplier

10 Compliance Inconsistencies between Companies

11 Working in the Gray Zone

Commodity jurisdiction (CJ)

Commodity classification automated tracking system (CCATS

12 Export-Controlled Information vs. Proprietary Information

An NDA Is Not an Export Authorization

Export and Proprietary Document Markings

13 Understanding Government Agencies and Licensing Timelines

14 ITAR 126.1 Proscribed Countries

Sanctioned and Embargoed Countries

15 International Travel with Company Devices

16 Application of Typical Export Controls

US personhood verification

Hosting non-US person visitors

Screening non-US entities and persons

Verifying your employee knows the rules of engagement

Knowing when a supplier is export compliant or not compliant

Photo/video taking

Encryption and cloud-based platforms

Disposal of export-controlled data and hardware

Resolving issues with software companies

17 Discussions with Non-US Persons without an Export License

Foreign supplier presenting or marketing their products and/or services

Discussions with a foreign supplier to manufacture ITAR-controlled hardware

Discussions with a foreign supplier to manufacture non-export-controlled hardware

18 Working with Universities

19 Reporting ITAR Violations to the DDTC

Consent Agreement

20 The ITAR Quadrant

21 Specially Designed

22 Employee Training

23 Common Export Violations

24 So You Want to Become an ECA?

25 Congrats! You Have Been ITARized

Appendix 1. Acronyms

Appendix 2. Key ITAR and EAR Terms

Appendix 3. Government Agencies and Resources

Appendix 4. United States Munitions list ITAR Part 121

Appendix 5. Commerce Control List Supplement No. 1 to Part 774

Appendix 6. Synonymous Terminologies

Appendix 7. About the Author

Appendix 8. Export Control from the Mid-2000s

To all my export control peers

and carnitas street tacos

1

For Whom This Book Is Written

Whether you love ITAR or hate ITAR or you are just looking to learn, this book is meant for you. The fact that you are reading past the first sentence already means you have an idea what ITAR is about—US government export controls. Perhaps the recent watercooler buzz is all about ITAR, and you now got hit with the FOMO feeling and want to get in on it. You are in the right place.

Typically, if you hear the word ITAR, you think export regulations. However, this book is intentionally not about the regulations. That alone should provide you some modicum of relief. This book describes real-life compliance applications at any company that manufactures export-controlled items. The focus is to highlight and explain common ways to implement export controls to be in compliance with the complex and tentacled export regulations. As the subtitle of the book suggests, this book aims to provide helpful hints to prevent an ITAR faux pas and keep you and your company out of trouble.

This book might explain some of the questions why certain controls are in place at your company since you were never taught that. This book is intended to provide you fundamental information on what drives ITAR controls. I wanted to craft this book as teaching the art of ITAR without ITAR. No technical jargon, eccentricities, or legal-eeze. Here are the objectives of this book:

1) Provide basic mechanics and fundamentals of ITAR controls

2) Provide helpful hints to further enhance your company compliance posture

3) Resource for those looking to increase their export control intelligence

4) Be an outlet for my personal rants about export controls, and hopefully, companies and employees will read this to increase export control awareness

You may have already worked with your company export control administrator (ECA), and you are convinced those export control muggles at your company do their utmost best to intentionally make your work more painful and difficult. Welcome to export controls! ITAR and EAR controls were created to protect US military technologies by any means necessary. It is up to you to help ensure your company compliance. Thus, the more awareness you have, the better for everyone.

This book aims to teach export control awareness. I will say that throughout the book ad nauseam. This book will not regurgitate the regulations but will pull some text from the regulations at times to add to the context of the topic and for clarification purposes. If you are working at an ITAR company or plan to work at one, unless you are the resident ECA, you really don’t need to know the regulatory details, you just need to know the mechanics of export controls and that ITAR will be a thing at any company manufacturing defense related items. All you need to do is remember that export controls exists and to recognize when export flags are raised not just for yourself but others around you.

This book is in no way legal guidance or advice. This book does not provide how-to instructions on compliance controls but will provide, hopefully in a very light and at times, whimsical way, the export control framework to include a chapter on a behind-the-scenes look at the Department of State process when you submit for an export authorization. There are many compliance touch-points an export-controlled company may face. By the way, when is the last time you heard the words export controls and whimsical in the same sentence? I have heard many other apropos terms associated with ITAR, such as sucks, hate, confusing, and evil rather than whimsical.

In the export control multiverse, there are many alternate realities. There could be different paths to the same compliance objectives. This book will attempt to explain why that is and why you may be getting different guidance from different ECAs and different compliance interpretations even between different companies. I will also explain why schools and government do not provide explicit guidance on how a company should effectively implement an internal compliance program.

The export world is primarily demarcated between ITAR and the EAR. For the purposes of overarching company internal controls, it doesn’t matter which ITAR or EAR category you are involved with. Export controls at the company level all share a common denominator—the protection of US technologies. While the book may be ITAR-centric, there are mentions of EAR-controls throughout as EAR is equally as important. However, the intent is to not get too much into the regulatory weeds of either the ITAR and the EAR regulations. This is simply a book to provide you awareness on how you may better protect your company no matter what export-controlled items you manufacture.

Whatever reason you have to read this book, and there is absolutely no bad reason, the aim is to ITARize you and increase your export awareness. After learning some helpful tips, you should not be caught with your ITAR pants down.

It should be pointed out that since the mechanics of the ITAR regulations and ITAR controls have not fundamentally changed since 1976, the applications of this book will have long-term and everlasting applicability for any company for years to come.

FIVE-POINT CHAPTER CHECK

✓ The world of export controls is primarily divided into ITAR and the EAR – TRUE

✓ This book focuses on the export regulations – FALSE

✓ This book is about increasing export control awareness – TRUE

✓ This book provides helpful tips on the implementation of internal company export controls – TRUE

✓ Since the mechanics of the ITAR regulations have not fundamentally changed since 1976, the applications of this book will have long-term and everlasting applicability for any company for years to come - TRUE

If you understood this chapter and passed the Five-Point Chapter Check, then an Asgardian High One to you, two thumbs-up, and a smiley face. 42701.png

2

The Basic Export Control Framework

For the newcomers, let’s dive right into it. The wonderful wacky world of export controls is immense, but the only export control exposure any employees receive at any company are from the required export training upon hire, if any. There may be annual refreshers. In all honesty, the very brief and very limiting export control training is no more than the dos and don’ts of export controls. There is no other background on what is driving those dos and don’ts. Therefore, while ECAs may have years of experience and live export controls daily, employees have no context of the basic export control architecture, which is a reason why it may be very difficult to remember at all.

Many colleagues would ask what export controls are all about, and I have provided separate training sessions to explain about the different regulatory jurisdictions in further detail and the priorities that drive ECA export decisions. For all my colleagues knew, I was pulling my export control determinations out of thin air and just performing export hocus-pocus. This chapter aims to clear up some of that Hogwarts export voodoo and provide some context on the export control regulatory hierarchies ECAs have to navigate through.

ECAs typically do not go into the weeds of the fundamentals and background of export controls with employees at the company. ECAs are not offered the proper amount of time to fully train employees to understand export controls, starting from US government agencies that flow down the export regulations. Let’s try to unravel the mystical magic that is export controls and explain basic export control fundamentals in a nonregulatory way.

ITAR Is Number 1

If we are to start at the top of the export control food chain, we have to start with the Department of State (DOS), United States Munitions List (USML) ITAR. ITAR stands for