Comments on: Wonked (or Not?)

By: P.Srinivasan

P.Srinivasan — Wed, 29 Aug 2007 14:45:30 +0000

I wish to know if the capacitor part M39014/01-xxxx series would come under the US Munitions List. It appears that the part is not under USML, since many big distributors export this part without any licenses. However, I wanted to confirm the same. Can anyone throw some light on the matter? Thanks for the help.

By: RS

RS — Fri, 04 May 2007 19:11:26 +0000

What I am waiting to see is how long will it take DDTC to cover irregular warfare under the ITAR. I could see some very interesting cases rising from that interpretation. Currently, unless I am mistaken, irregular warfare is only mentioned in the definition of defense services – training military forces, regular and irregular. Also, I am thinking of how the General Order imposing licensing requirements for all shipments to Mayrow came about. Current export control regime in the US is not well suited for regulation of exports to irregular (i.e. terrorist) forces, unless they are specifically named on the SDN or the export involves training.

By: Export Boy

Export Boy — Thu, 03 May 2007 17:12:33 +0000

The subjectivity inherent in these discussions is always frustrating. In the absence of clear guidance, there is an attempt to apply the “common sense” approach to the regulations, as in the potato example.

I agree that the ITAR, broadly written as it is, can be interpreted with just such an ultra-conservative view. However, since you yourself imply that you would not apply that conservative view towards the potatoes, where is the line crossed?

I still say it is crossed in the ways I mention in my previous post, or whenever the technical data that results from or is used to perform the test is itself controlled. Or if the item is modified, of course.

By: Troy

Troy — Thu, 03 May 2007 17:11:53 +0000

Thanks Clif,

Where does it end?

If this is how we are to interpret ITAR, then why would need the Commerce Control List.

At some point, there needs to be a clear and definitive distinction between the 2 sectors. Right now everything is starting to become cloudy and grey.

By: Clif Burns

Clif Burns — Thu, 03 May 2007 16:02:04 +0000

Troy,

My point wasn’t that potatoes were USML. My point was that supplying potatoes to the French navy assisted them in using their ships which are defense articles.

I admit that this example is far-fetched and probably outside what the definition intends; my point, however, is that the language of the definition is broad enough to cover the potato example.

By: Mike Deal

Mike Deal — Thu, 03 May 2007 15:57:28 +0000

On the issue of defense services, remember that in several enforcement cases, the respondent was forced to agree to lanquage to the effect that a defense service includes the application of uncontrolled, public domain knowledge to defense articles. Thus testing, even using civilian standards (e.g., FAA safety of flight) to assure that a product meets spec can be a defense service if the product is intended for use on a military product. This has wide ramifications even for non-exporters, e.g., in the employment of foreign nationals and even in registration. I recently had DDTC tell a client that sold a testing machine to a defense contractor which machine differed from the normal product only in that the cables for the input devices had been lenghtened in order to fit the military item, that not only would the client have to get a license to employ the foreign engineer who designed the machine, but it would now have to register as well before it could apply for the license or sell any more modified products to domestic defense contractors. Of course, the client was a small business.

By: Troy

Troy — Thu, 03 May 2007 15:57:14 +0000

Clif,

I would like to point out in the definition:

The furnishing of assistance . . . to foreign persons, whether in the United States or abroad in the design, development, engineering, manufacture, production, assembly, testing, repair, maintenance, modification, operation, demilitarization, destruction, processing or use of defense articles.

A defense article is any item designed, configured or modified for military usage and would need to fall in the US munitions list.

Was a potatoe designed for military usage? No. Is it covered in the US munitions list? No.

You would not need an ITAR Hardware license to ship potatoes to the French Navy since they are not defense articles.

A commercial item would only require a Technical Agreement or Technical Data License if you were offering any of the Technical Data:

Technical data means, for purposes of this subchapter:

Information, other than software as defined in §120.10(a)(4), which is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles. This includes information in the form of blueprints, drawings, photographs, plans, instructions or documentation.

Classified information relating to defense articles and defense services;

Information covered by an invention secrecy order;

Software as defined in §121.8(f) of this subchapter directly related to defense articles;

This definition does not include information concerning general scientific, mathematical or engineering principles commonly taught in schools, colleges and universities or information in the public domain as defined in §120.11. It also does not include basic marketing information on function or purpose or general system descriptions of defense articles

I hope that makes sense.

By: Clif Burns

Clif Burns — Thu, 03 May 2007 15:23:01 +0000

Export Boy, it’s true even if the item is to be integrated into the defense article by a non-US person outside the US. The definition of defense service is quite broad:

The furnishing of assistance . . . to foreign persons, whether in the United States or abroad in the design, development, engineering, manufacture, production, assembly, testing, repair, maintenance, modification, operation, demilitarization, destruction, processing or use of defense articles.

So it doesn’t matter what the testing reveals. If the testing helps the foreign person design, manufacture or use a defense article, it’s a defense service. In general, that rule is so broad that it really should read simply “no U.S. person should do anything for a foreign military.”

Does that mean I can’t, say, sell potatoes to the French Navy? You can argue, after all, that you can’t sail a ship on an empty stomach so the potatoes help foreign persons use the ship. I doubt that is what the definition had in mind, but still it does fit within the language of the definition.

Of course, the Sudarshan case isn’t really a hard one like my potato example, inasmuch as they were testing the microprocessors to make sure they’d work in the fighter jets.

By: Export Boy

Export Boy — Thu, 03 May 2007 15:01:27 +0000

So, would testing a commercial item (within the US) to a specification provided by a foreign military be considered a defense service if the item was INTENDED to be integrated into a defense article? If yes, is that true even if the item is integrated by a non-US person outside the US?

My answer is: 1) If the testing is such that it only reveals performance thresholds and statistics, etc., for the item – no. 2) If, however, it reveals or is intended to reveal a use for the commercial article not previously identified, or reveals other data relative to an unintended defense use for the item – yes. Unfortunately there is a VERY fine line between these, and (2) can be true in the performance of (1).

Good lord, did that make any sense?

By: Scott K.

Scott K. — Thu, 03 May 2007 14:39:28 +0000

Frank, re-read the first sentence of Troy’s comment.