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EXPORT CONTROLS & TRADE SANCTIONS

ITAR (International Traffic in Arms Regulations), EAR (Export Administration Regulations), and OFAC (Office of Foreign Assets Control) are federal export control and trade sanction mechanisms, and they have multiple goals—to advance United States trade interests and foreign policy initiatives, and to protect and promote our national security. University research has generally been exempt from export control compliance. Federally funded fundamental research has commonly been restricted only by security classification, and the University of Chicago does not conduct classified research (see University of Chicago Policy on Performing Classified Research). We have held, therefore, that the research conducted is exempt from export controls through the ‘fundamental research exemption’. If a research activity is judged to be ineligible for exemption, licensing requirements may apply.

ITARs have been around for a long time, but the Munitions List has had little relevance to the University of Chicago. However in 1999, Congress transferred responsibility for satellite technology from the Commerce Department to the State Department. Consequently, research activity that was once subject to the fundamental research exclusion under ‘National Security Defense Directive 189’ (see below) became, for the first time, formally regulated and made subject to the State Department’s International Traffic in Arms Regulations (ITAR). Since September 11, the effort to balance national security concerns and open communication in the academic community has been subject to increased scrutiny, and the understanding of controlled activities and persons has broadened significantly (note the restrictions on certain foreign nationals, and the possibility of a ‘deemed export’ — the transmission of goods, technology, or related information to foreign nationals within the United States, that is to say, within your laboratory). The official definitions below are a key to understanding federal expectations, and in the current climate they are being interpreted quite strictly. Principal Investigators should consider their research in this new light to determine whether it may be impacted by these regulations. Export controls are statutorily based and do not have to be cited specifically in an award document to apply. The penalty for noncompliance can be quite severe, ranging from loss of funding support, to significant fines per violation, to imprisonment for up to 10 years.

To assist you in determining whether your research falls under the export control regulations, please see Checklist for Export Control Issues and Addendum Checklist for Export Control Issues Related to Laptops or GPS Equipment.

If you have questions after you have reviewed this site, or if you would like guidance as to whether your research may fall under these regulations, please contact URA at 702-8669 for assistance.

ITAR – State – Military items; space-related technology & research

EAR – Commerce – Dual-use goods, technology & software

OFAC – Treasury – Trade prohibitions with sanctioned countries/entities

See detail under ‘Export Control Vocabulary’ below.


Fundamental Research Exemption

The University of Chicago policy on academic freedom is set out in the Statutes of the University, enacted by the Board of Trustees. Statute 18 (PDF) begins:

“The basic policies of The University of Chicago include complete freedom of research and the unrestricted dissemination of information…..The normal method of dissemination of the results of academic work is through publication in scholarly or other public media.”

Export control regulations have the potential to undermine academic freedom. This possibility has been acknowledged and provided for in National Security Decision Directive 189 (NSDD), which exempts fundamental research from export control. The Directive defines fundamental research.

“Fundamental research’ means basic and applied research in science and engineering, the results of which ordinarily are published and shared broadly within the scientific community, as distinguished from proprietary research and from industrial development, design, production, and product utilization, the results of which ordinarily are restricted for proprietary or national security reasons.”

It should be noted that the Fundamental Research Exemption applies only to the dissemination of technical data and information, not to the transmission of material goods. The exemption is more broadly construed under the EAR than under ITAR.

ITAR (International Traffic in Arms Regulation) – 22 CFR §§ 120-130, promulgated and overseen by the Department of State to regulate defense articles and defense services, including related technical data, which appear on the United States Munitions List.

Export §120.7 — (1) Sending or taking a defense article out of the United States in any manner, except by mere travel outside of the United States by a person whose personal knowledge includes technical data; or (2) Transferring registration, control or ownership to a foreign person of any aircraft, vessel, or satellite covered by the U.S. Munitions List, whether in the United States or abroad; or (3) Disclosing (including oral or visual disclosure) or transferring in the United States any defense article to an embassy, any agency or subdivision of a foreign government (e.g., diplomatic missions); or (4) Disclosing (including oral or visual disclosure) or transferring technical data to a foreign person, whether in the United States or abroad; or (5) Performing a defense service on behalf of, or for the benefit of, a foreign person, whether in the United States or abroad.

Defense Article §120.6 — Defense article means any item or technical data designated in §121.1 (the United States Munitions List-USML) (a) Is specifically designed, developed, configured, adapted, or modified for a military application, and (i) Does not have predominant civil applications, and (ii) Does not have performance equivalent (defined by form, fit and function) to those of an article or service used for civil applications; or (b) Is specifically designed, developed, configured, adapted, or modified for a military application, and has significant military or intelligence applicability such that control under this subchapter is necessary. The intended use of the article or service after its export (i.e., for a military or civilian purpose) is not relevant in determining whether the article or service is subject to the controls

Defense Service §120.9 — (a) Defense service means: (1) The furnishing of assistance (including training) to foreign persons, whether in the United States or abroad in the design, development, engineering, manufacture, production, assembly, testing, repair, maintenance, modification, operation, demilitarization, destruction, processing or use of defense articles; (2) The furnishing to foreign persons of any technical data controlled, whether in the United States or abroad; or (3) Military training of foreign units and forces, regular and irregular, including formal or informal instruction of foreign persons in the United States or abroad or by correspondence courses, technical, educational, or information publications and media of all kinds, training aid, orientation, training exercise, and military advice.

Technical Data §120.10 — Information which is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles. This includes information in the form of blueprints, drawings, photographs, plans, instructions and documentation; (2) Classified information relating to defense articles and defense services; (3) Information covered by an invention secrecy order; (4) Software as defined in §121.8(f) of this subchapter directly related to defense articles; (5) This definition does not include information concerning general scientific, mathematical or engineering principles commonly taught in schools, colleges and universities or information in the public domain as defined in §120.11. It also does not include basic marketing information on function or purpose or general system descriptions of defense articles.

Public Domain is defined in 22 CFR §120.11 as accessibility: (1) through sales at newsstands and bookstores; (2) through subscriptions which are available without restriction to any individual who desires to obtain or purchase the published information; (3) through second class mailing privileges granted by the U.S. Government; (4) at libraries open to the public or from which the public can obtain documents; (5) through patents available at any patent office; (6) through unlimited distribution at a conference, meeting, seminar, trade show or exhibition, generally accessible to the public, in the United States; (7) through public release (i.e., unlimited distribution) in any form (e.g., not necessarily in published form) after approval by the cognizant U.S. government department or agency; and (8) Through fundamental research in science and engineering at accredited institutions of higher learning in the U.S. where the resulting information is ordinarily published and shared broadly in the scientific community. Fundamental research is defined to mean basic and applied research in science and engineering where the resulting information is ordinarily published and shared broadly within the scientific community, as distinguished from research the results of which are restricted for proprietary reasons or specific U.S. Government access and dissemination controls. University research will not be considered fundamental research if:

(i) The University or its researchers accept other restrictions on publication of scientific and technical information resulting from the project or activity, or

(ii) The research is funded by the U.S.Government and specific access and dissemination controls protecting information resulting from the research are applicable.

EAR (Export Administration Regulations) —15 CFR §§ 730-744, prohibit the unlicensed export of items designed for a commercial purpose, but which may also have military applications (dual-use items, technologies, and software). These items, technologies, and software are delineated on the Commerce Control List (CCL) – see alphabetical index (PDF) to Part 774.

OFAC (Office of Financial Assets Control) – the mission of OFAC is to “administer and enforce economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction.” OFAC prohibits payments or providing “value” to nationals of sanctioned countries/activities.