The United States imposes export controls to protect national security interests and promote foreign policy objectives related to dual-use items and less-sensitive military items through the Export Administration Regulations (EAR) (15 CFR Parts 730 – 774).  The Bureau of Industry and Security (BIS) is responsible for regulating, implementing, and enforcing export controls for such dual-use items and less sensitive military items.  Within BIS, Export Administration (EA) is responsible for processing license applications, counselling exporters, and drafting and publishing changes to the EAR; and Export Enforcement (EE) is responsible for compliance monitoring and enforcement of the EAR.  BIS works closely with U.S. embassies, foreign governments, industry, and trade associations to ensure that the export, reexport and transfer (in-country) of items subject to the EAR is accomplished in compliance with the regulations.

Enforcement: 

BIS officials conduct site visits, known as End-Use Checks (EUCs), globally with end-users, consignees, and/or other parties related to transactions involving items subject to the EAR and shipped under a license or another form of BIS authorization to verify compliance with the EAR and the conditions of the license or authorization.  An EUC is an on-site verification of a non-U.S. party to a transaction to determine whether the party is a reliable recipient of items subject to the EAR.  EUCs are conducted as part of BIS’s licensing process, as well as its compliance program, to determine if items were exported in accordance with a valid BIS authorization or otherwise consistent with the EAR.  Specifically, an EUC verifies the bona fides of transactions subject to the EAR, including:  confirming the legitimacy and reliability of the end use and end user; monitoring compliance with license conditions; and ensuring items are exported, reexported or transferred (in-country) in accordance with the EAR.  These checks might be completed prior to the export of items pursuant to a BIS export license in the form of a Pre-License Check (PLC) or following an export during a Post-Shipment Verification (PSV), regardless of whether a BIS license is required.

BIS officials rely on EUCs to safeguard items subject to the EAR from diversion to unauthorized end uses/users and destinations.  The verification of a foreign party’s reliability facilitates future trade, including during BIS license reviews.  If BIS is unable to verify the reliability of the company or is prevented from accomplishing an EUC, the company may receive, for example, more regulatory scrutiny during license application reviews or be designated on BIS’s Unverified List or Entity List, as applicable.

Guidance and Training: 

BIS has developed a list of “red flags,” or warning signs, and compiled “Know Your Customer” guidance intended to aid exporters in identifying possible violations of the EAR.  Both of these resources are publicly available, and their dissemination to industry members is highly encouraged to help promote EAR compliance.  BIS also provides a variety of training sessions to exporters throughout the year.