Export control is legislation that regulates the export of goods, software and technology. Some items could potentially be useful for purposes that are contrary to the interest of the exporting country. These items are considered to be controlled. The export of controlled item is regulated to restrict the harmful use of those items. Many governments implement export controls. Typically, legislation lists and classifies the controlled items, classifies the destinations, and requires exporters to apply for a licence to a local government department.
A wide range of goods have been subject to export control in different jurisdictions, including arms, goods with a military potential, cryptography, currency, and precious stones or metals. Some countries prohibit the export of uranium, endangered animals, cultural artefacts, and goods in short supply in the country, such as medicines.
History
The United States has had export controls since the American Revolution, although the modern export control regimes can be traced back to the Trading with the Enemy Act of 1917. A significant piece of legislation was the Export Control Act of 1940 which inter alia aimed to restrict shipments of material to pre-war Japan. In the United Kingdom, the Import, Export and Customs Power (Defence) Act of 1939 was the main legislation prior to World War II.
Post WWII, the Coordinating Committee for Multilateral Export Controls (CoCom) was founded in 1948, and continued until 1994. It was an early Multilateral export control regime.
Principles
In most export control regimes, legislation lists the items which are deemed 'controlled', and lists the destinations to which exports are restricted in some way. The lists of what is controlled often arise from some harmonised regime.
Classification
Goods may be classified using a various classification systems. The United States uses the Export Control Classification Number (ECCN), India uses the Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) list and Japan uses Ministry of Economy, Trade and Industry (METI) lists.
Some items may be categorised as "designed or modified for military use", some as dual use, and some will not be export controlled. Dual use means that the device has both a civilian and a military purpose.
In several jurisdictions, classifications distinguish between goods, equipment, materials, software and technology; the last two being often considered intangible. Classifications may also be by destination purpose, including cryptography, laser, sonar and torture equipment.
Destination
An exporting country will consider the impact of its export control policy on its relationships with other countries. Sometimes countries will have trade agreements or arrangements with a group of other countries, which may specify that licences are not required for certain goods. For example, within the EU, licences are not required for shipping civilian goods to other member states; however, licences are required for restricted, military goods.
The exporting country's legislation will demand certain handling for goods in different classifications to destination countries. This could include: The destination is subject to sanctions, perhaps economic sanctions. Exports of that class of goods will not be permitted. Shipping the goods may require licences from the government. These licences may require record keeping, so the exporter has to log the items and destinations. Where records are kept, there may be an audit, or there may be some requirement to report the transactions periodically. some have no restrictions and that class of goods can be shipped without impediment from export control legislation.
The end user of the goods or some broker will typically be declared, and similar restrictions apply as to countries.
Some individuals or entities may be listed, so that even if the item could normally be exported to the country without a licence, additional restrictions apply for that individual or entity.
Licence
For any given item being exported, the categorisations will typically lead to different treatments for a given destination, e.g. 'No Licence Required' (NLR) or 'Licence Required'.