Glossary term
Export Controls
Subject: Compliance and Regulation, Trade and Export Controls
Export controls are government rules that restrict or license the sale or transfer of certain goods, software and technology to other countries, people or end uses, usually for security or foreign policy reasons.
Explanation
Controlled items are named on lists, such as military goods and dual-use items. Whether a licence is needed depends on the item, the destination, the buyer and the end use. Authorities issue individual licences for single transactions or general licences covering defined categories. Catch-all controls reach unlisted items when the seller has reason to think they will serve weapons programmes or for a restricted military end use. Technology transfer rules apply to blueprints, source code, training and even technical talks and remote access, not only physical shipments. Governments often apply their rules to re-exports and to foreign-made goods containing controlled content. Companies classify products, screen parties, apply for licences and keep records. Banks financing the trade ask for licence copies, because a breach by the customer can pull the lender in too.
Example
A software firm sells data analysis tools with strong encryption to customers in many countries. The compliance team classifies the product, finds that exports to one destination need a licence and blocks sales there until the licence is granted. It also stops engineers in that region from accessing the source code repository, because remote access counts as a technology transfer.
Not to be confused with
- Sanctions
- Sanctions target countries, entities and individuals. Export controls target particular items and technology, wherever they are going.