Both the EAR and the ITAR regulate Deemed Exports. But what exactly is a Deemed Export and how is it different from a traditional export?

Exports Defined

Most people assume exporting means shipping a tangible item outside of the United States. But it is possible to export technology and non-tangible items. And it is also possible to export even within the United States. A Deemed Export is defined as releasing or otherwise transferring controlled technical data to a foreign person in the United States. Both the EAR and the ITAR regulate these Deemed Exports, but to different extents.

EAR and Deemed Exports

Under the EAR, releases of controlled technology to foreign persons in the U.S. are "deemed" to be an export to the person’s most recent country or countries of nationality.

Typical organizations using EAR “deemed” export licenses include universities, high technology research and development institutions, bio-chemical firms, as well as the medical and computer sectors.

With Deemed Exports, there is usually an obligation to obtain an export license from BIS or DDTC before “releasing” controlled technology to a foreign person.

ITAR and Deemed Exports

Under the ITAR, releasing or otherwise transferring technical data to a foreign person in the United States is considered a “deemed” export. Any release in the United States of technical data to a foreign person is deemed to be an export to all countries in which the foreign person has held or holds citizenship or holds permanent residency.

As an example, if you have a deemed export of ITAR technology to a foreign national from Canada, that was born in China, then ITAR views that as a deemed export to Canada AND China. EAR would view that only as an export to Canada.

Exemptions from Deemed Exports

It should be noted that those organizations having technology exchanges with persons with permanent residence status, U.S. citizenship, and persons granted status as "protected individuals" are exempt from the “deemed” export rule.

EAR “Deemed” exports are described in 734.13(b) of the EAR. The EAR defines a "release" of "technology" or source code in section 734.15 of the EAR, and defines activities that are not "deemed" exports in section 734.20 of the EAR. EAR Deemed Exports: https://www.bis.doc.gov/index.php/policy-guidance/deemed-exports

ITAR Deemed Exports are described in §120.17 Export: https://www.ecfr.gov/cgi-bin/text-idx?SID=70e390c181ea17f847fa696c47e3140a&mc=true&node=pt22.1.120&rgn=div5#se22.1.120_117

For further information about deemed exports and the specifics surrounding EAR and ITAR designations, contact Redstone Government Consulting. We offer a variety of consulting packages, training, and a host of educational articles on our website.

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Written by Carolyn Quinn Turner

Carolyn Quinn Turner Carolyn assists Redstone Government Consulting, Inc. in the area of International Trade and Import/Export Compliance, specifically the International Traffic in Arms Regulations (ITAR) the Export Administration Regulations (EAR). Carolyn assists a wide variety of contractors with compliance in international trade and ITAR/EAR regulations as well as implementing policies and procedures that assist companies in those areas. Professional Experience Starting in 2002, Carolyn was an International Research Analyst at the Alabama International Trade Center. While here, she conducted country and market analyses and translated trade documents. She then worked at Page & Jones, Inc., handling freight coordination for the NVO imports and exports, gathered freight rates for all customers, both import and export, and acted as the NVO controller by handling training, coordinating shipping rates, and record keeping. Starting in 2008, Carolyn held the position of International Trade Specialist at the Alabama International Trade Center. She assisted small and medium sized companies with international trade, expanded company’s sales via international opportunities, problem solved wide ranging international topics such as ITAR and EAR, classification, regulations, contracts, finance options, risk mitigation, and more. She also conducted country/market analyses for international market research, provided international business training and presented educational industry seminars and oversaw research staff on international trade projects and assignments. During the period of 2011-2016, Carolyn was also an Adjunct Professor at the University of Alabama, developing and teaching online International Business classes. In addition to her international experience, Carolyn has studied in Spain, Chile, and Cuba and has work experience in trade missions in Thailand, Norway, Sweden, and Chile. She can read, write, and speak Spanish proficiently. Certifications In 2005, Carolyn became a Licensed US Customs Broker during her time with Page & Jones, Inc., and focused on HTS and Schedule B Classification as well as Entry Filing. In 2009, Carolyn earned the NASBITE Certified Global Business Professional Certification. She has training on these topics: Incoterms, International Distributor Agreements, How to Prepare for an Import & Export Audit, ITAR and EAR, NAFTA, and other FTA’s, Developing an Import/Export Compliance Program, Import and Export Documentation, Customs Brokers License Training Course with Logistics Training Systems, Hazardous Materials, SBA and EXIM Trade Financing, Trade Promotion Coordination Committee (TPCC) Training, SBIR Grants, International Intellectual Property Rights, and global e-commerce. Education Carolyn has earned her Bachelor of Science degree in Commerce and Business Administration from the University of Alabama in Tuscaloosa. She has also earned her Masters in Management with a Global Business Concentration from the University of Alabama in Tuscaloosa. Affiliations She has been a board member of the Japan America Society of Alabama since 2009 and a board member of Destination Hoover International since 2018. Carolyn is also a member of the Export Alabama Alliance.

About Redstone GCI

Redstone GCI is a consulting firm focused on fulfilling the needs of government contractors in all areas of compliance. With a singular mission to help contractors through the multiple layers of “red tape,” we allow contractors to focus on what they do best – support their mission with the U.S. Government. We are home to a group of consultants made up of GovCon industry professionals, CPAs, attorneys, and retired government audit and acquisition professionals.

Our focus and knowledge of audit and compliance functions administered by DCAA and DCMA will always be at the heart of what we do. However, for the past decade, we’ve strategically grown to support other areas of the government contractor back-office with that same level of focus and expertise. We’ve added expertise in contracts management, subcontract administration, proposal pricing, various software systems, HR and employment law, property administration, manufacturing, data analytics/reporting, Grant specialists, M&A, and many other areas. When we see a trend in the needs of contractors, we act to ensure we can provide the best expertise in the market to fulfill those needs.

One thing our clients can be certain of is that with the Redstone GCI Team in your corner, there is no problem too big and no issue too technical for our team to tackle.

Topics: Government Regulations, Export & Import