The Export Administration Regulations (EAR) govern the export and reexport of items for reasons of national security, non –proliferation, foreign policy, and short supply.
Licenses
A relatively small percentage of exports and reexports require the submission of a license application to the U.S. Department of Commerce’s Bureau of Industry and Security (BIS). Licensing is dependent on an item’s technical characteristics, destination, end use, and end user. Once a classification has been determined, exporters may use a single chart, set forth in the EAR, to decide if a license is needed to export to a particular country.
Antidiversion Clause
To ensure that U.S. exports go only to legally authorized destinations, the U.S. government requires a destination control statement on shipping documents. The commercial invoice and bill of lading (or air waybill) for nearly all commercial shipments leaving the United States must display a statement notifying the carrier and all foreign parties (the ultimate and intermediate consignees and purchase) that the U.S. material has been improved for export only to certain destinations and may not be diverted.
Antiboycott Regulations
The United States has an established policy of opposing restrictive trade practices or boycotts fostered or imposed by foreign countries against other countries friendly to the United States. This policy is implemented through the antiboycott provisions of the Export Administration Act (enforced by the U.S. Department of Commerce) and through a 1977 amendment to the Tax Reform Act of 1976 (enforced by the U.S. Department of the Treasury). In general, these laws prohibit U.S. persons from participating in foreign boycotts or taking actions that further or support such boycotts.
Foreign Corrupt Practices Act
Under the Foreign Corrupt Practices Act (FCPA), it is unlawful for a U.S. person or firm (as well as any officer, director, employee, or agent of a firm or any stockholder acting on behalf of the firm) to offer, pay, or promise to pay (or to authorize any such payment or promise) money or anything of value to any foreign official (or foreign political party or candidate for foreign political office) for the purpose of obtaining or retaining business. It is also unlawful to make a payment to any person while knowing that all or a portion of the payment will be offered, given, or promised—directly or indirectly—to any foreign official (or foreign political party or candidate for foreign political office) for the purposes of assisting the firm in obtaining or retaining business. The FCPA also covers foreign persons or firms that commit acts in furtherance of such bribery in the territory of the United States.