Government contractors or commercial companies in the import and export business or international trade often find themselves in hot water when the federal government demands a copy of their ITAR Compliance Manual.
This usually occurs when there is an investigation for ITAR certification and compliance, False Claims Act Violation or some other form of ITAR penalty.
Importance of Having a Valid ITAR Compliance Manual?
The old days of claiming that your company did not have general knowledge of the illegality of criminal conduct is not sufficient to avoid a criminal conviction. Not only does your company operate more efficiently and has a sense of uniformity but when there is a government investigation about alleged conduct, having a valid ITAR compliance manual can reduce any adverse actions and show the investigative agency that you have a mitigation factor that may warrant leniency.
Also relying on the federal government to prove that an import and export company knew of the specific law or ITARS regulation that was violated has also been dispelled in recent court decisions.
SAMPLE COURT CASE
In the case of United States v. Brian Keith Bishop, No. 13–4356, 2014 WL 292695 (4th Cir. Dec. 11, 2013), the Fourth Circuit joined the other federal circuit courts by agreeing that proof of general knowledge of the illegality of the conduct is sufficient to convict a person of a willful violation of US export laws.
The above shows that having internal policies and controls for ITAR compliance is critical to minimizing the impact of ITAR compliance penalties and fines. See information about how to get ITAR certification.
To meet the various ITAR requirements, companies in the import and export industry should also have internal policies and controls that address.
- The procedure, when an ITAR controlled item/technical data, is transferred by the company to a foreign national employed at the company.
- Procedure when an ITAR controlled item/technical data is transferred by the company to a foreign person within the U.S.
- The procedure, when ITAR controlled technical data or defense articles, is transferred from the company to a foreign person outside of the U.S.
- Procedure when an ITAR controlled item/technical data is to be used or transferred for an end-user not included in the State Department authorization.
What Must Your Manual Include?
When your draft an ITAR compliance manual it should cover a broad range of issues that show that you really understand ITAR regulations and that you have mechanisms in place to reduce the possibility of compliance violations.
Showing that you have standard procedures from the head of ITAR compliance down to your employees throughout the company is also important.
Your ITAR manual should also have sufficient evidence to show that your company is committed to following the underlying intent of import and export regulations. This can include mandatory disclosure policies, making that your subcontractors and manufacturers are also in compliance.
The federal government wants to be assured that important information is not getting into the wrong hands. When violations occur, it is simply too late to try to write procedures.
For help getting your import and export business to meet federal law, call our ITAR consultants for help with your ITAR compliance manual. 1-866-601-5518.