Demystifying the Export Administration Regulations (EAR)

Understanding and adhering to the Export Administration Regulations (EAR) is crucial for businesses involved in exporting goods, technology, and software. Enforced by the Bureau of Industry and Security (BIS) within the U.S. Department of Commerce, these regulations aim to:

• Control exports of dual-use items: These items have both commercial and military applications, like advanced software or certain materials.

• Prevent sensitive information transfer: This includes protecting national security, nonproliferation efforts, and foreign policy interests.

Key points to remember:

• Identify controlled items: Use the Commerce Control List (CCL) to check if your item requires an export license based on its Export Control Classification Number (ECCN).

• EAR99 designation: Some commercial items not on the CCL fall under EAR99 and might require licenses depending on the destination, end user, or end use (e.g., nuclear programs).

• Cloud service providers (CSPs): They aren’t exporters when it comes to customer data usage. However, customers remain responsible for EAR compliance of their data and software.

• Encryption for data protection: Unclassified technical data and software transmitted and stored using end-to-end encryption with FIPS 140 validated modules don’t require licensing (certain restrictions apply).

• Encryption standards: FIPS 140-2 certified methods are considered secure. Alternative methods must be equally or more effective, with the exporter proving their efficacy.

Additional resources:

• Export Administration Regulations (EAR): https://www.bis.doc.gov/index.php/regulations/export-administration-regulations-ear

• EAR – Azure Compliance: https://learn.microsoft.com/en-us/azure/compliance/offerings/offering-ear

• Commerce Control List (CCL): https://www.bis.doc.gov/index.php/regulations/commerce-control-list-ccl

• Recently Published Regulations: https://www.bis.doc.gov/index.php/regulations

• Revisions to Definitions in the EAR: https://www.federalregister.gov/documents/2016/06/03/2016-12734/revisions-to-definitions-in-the-export-administration-regulations

By staying informed and compliant with the EAR, businesses can minimize risks and ensure smooth international trade operations.

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