It’s that time of year when many of us start eyeing up those projects around the house we’ve been ignoring and start thinking about spring cleaning. Did you know that 76% of Americans engage in spring cleaning? Depending on the type of person you are, this can elicit feelings of dread or excitement.
While most focus on cleaning closets, yardwork, and reorganization, if you are the manufacturer or exporter of ITAR defense articles or services, there is a different level of spring cleaning you should do to ensure your program is in order. Often in the course of daily business, it is easy to forget that there is a lot to maintain when it comes to ITAR compliance. Perhaps your ITAR program is starting to look like your junk drawer at home … filled with loose cough drops, dead batteries, and random keys. If this is the case, consider a spring clean-up focused on organizing and bringing your program back to life.
Here are three things you should do this spring to ensure your ITAR program is in top shape:
-Dust Off Your ITAR Registration
Is your registration growing dust bunnies? If you think you only need to renew your registration annually in order to maintain it, think again! Unless your company never changes, it is likely that you might be delinquent on some important amendments to your registration. Certain material changes require notification to DDTC within five days of the event. The most common amendments include changes to senior officers, board of directors, address changes, company names changes, and any changes in the legal organization structure. This means that if one of your senior officers’ leaves, you must inform DDTC within five days. If you missed the five-day window for material changes, you may need to submit a voluntary disclosure.
Major events such as a transfer of control to a foreign person or entity require 60 days’ notice. Minor changes such as adding or deleting USML categories can simply be made at the time of your renewal. If you have amendments and are within 60 days of your renewal date, DDTC asks that you submit the amendment with your registration. However, if you are outside of that window, you will need to submit those amendments separately.
Maintaining your registration is key to export compliance.
-Organize Your Authorizations
Recently, a friend asked me how I organized my coat closet. I sent her a picture of a closet so jam-packed with randomness that the door wouldn’t shut. You can bet that closet is first on my list to organize.
When it comes to exports, many Export Compliance Officers (ECOs) find their files just as hard to navigate. Having a license/agreement log is extremely handy when trying to keep track of multiple license values and expiration dates. It also helps with internal audits and allows you to renew licenses before they expire. This can be as simple as an Excel spreadsheet, or it could be something tied into the ERP system. Either way you do it, licenses and agreements should be easy to locate and review. Keeping your authorizations in a structured and easy to read format is a sure-fire way to stay organized and on top of any renewals or amendments that need to be made before they expire or the value is depleted.
-Freshen up your Export Compliance Manual
If you review your export compliance manual as often as you clean your baseboards, you may be in need of some serious updates this spring. Too often, companies implement a manual, but then leave it to collect dust on the shelf. It is important to periodically review your manual for updates and changes to your procedures. Some areas to pay particular attention to include:
- Management Policy: Has this been updated, renewed, disseminated?
- Export Organization: Are the correct contacts listed?
- Reporting of Potential Violations: Is there an anonymous way to report violations? Is this included in the manual?
- Technology Control Plan: Is this still accurate? Are employees properly trained on securing controlled technology?
There is a tip I read when it comes to spring cleaning: “If you haven’t used it or thought about it in a year, get rid of it.” In terms of an export compliance program, if you haven’t used it or thought about it in a year, then you are at serious risk of export violations. (Just remember not to throw your ITAR records away after a year as these are required to be kept for five years per 130.14.)
Don’t wait, review your program today and walk into spring confident that your export compliance is effective and up-to-date.
If you need assistance reviewing your ITAR compliance program, please contact us for a free consultation.
Emmalie Armstrong is a Trade Compliance Consultant with Export Solutions – a firm specializing in U.S. import/export regulations.