Export Administration Regulations: License Determination
Does my product require an export license? That's a question you should ask before every export.
In order to find the answer, you first need to answer two preliminary questions:
- What is the Export Control Classification Number (ECCN) of the product?
- What is the destination country?
The ECCN codes are found in the Commerce Control List (CCL), which is part of the Department of Commerce’s Export Administration Regulations (EAR). Picking the right ECCN requires that you understand the technical characteristics of the product you’re shipping.
(Different government agencies have jurisdiction over different types of export. This article is only concerned with exports that fall under the jurisdiction of the Commerce Department, the agency that controls most U.S. exports. For more information about State Department regulations.
Reasons for Control
Each ECCN has associated ECCN reasons for control. These are reasons why the export of this product would be controlled; in other words, reasons this product might require an export license.
Along with the ECCN reasons for control, there are also country reasons for control. These are reasons why exports to that particular country are controlled; in other words, reasons why exports to that particular country would need an export license.
Once you know the ECCN and the destination country, you have two options for determining whether your product needs an export license: (1) look at the printed Commerce Country Chart, or (2) utilize software
Using the Commerce Country Chart
The old-school way of determining if you need a license for your export involves lining up rows with columns on the Commerce Country Chart to see if there are any reasons for control that show up in both the ECCN reasons and the country reasons.
If there is a reason that is listed under both the ECCN reasons and the country reasons, then the export shipment is controlled, meaning it requires the exporting company to apply for a license or otherwise obtain authorization from the controlling agency.
Just as there are both ECCN reasons for control and country reasons for control, there are ECCN license exceptions and country license exceptions. License exceptions refer to specific criteria that, if met, allow a company to export without a license even when there are one or more reasons for control.
There are four factors that play a role in determining if you need an export license. In this article, we’ve covered two:
- The technical characteristics of the product (as communicated in the form of an ECCN; and
- The destination country.
There are two other factors that are important not to overlook:
- The end-user (the identity of the party to whom the shipment will ultimately be sent); and
- The end-use (how the goods will actually be used).