US Re-Export Control

Foreign manufacturers incorporating U.S. content must determine their obligations under U.S. export controls, in addition to those of their own countries, in order to prevent the diversion of controlled U.S. items to destinations and end-users that would be inimical to the national security or foreign policy interests of the United States.

10% de minimis rule – Exports of non U.S. products incorporating U.S.-origin commodities or “bundled” with U.S.-origin software valued at 10% or more of the total value of the foreign technology to Iran, Cuba, Sudan, North Korea and Syria are subject to the EAR.

25% de minimis rule - Exports of non U.S. products incorporating U.S. origin commodities or “bundled” with U.S.-origin software valued at 25% or more of the total value of the foreign technology to countries other than those above are subject to the EAR.

These two rules means of course that foreign companies can incorporate American technology and ship the products to any country in the world including US embargoed countries, without permission from BIS, with just some few exemptions.

US export laws are valid also for re-export of US products from any country, according to stipulations in the documentation from the Bureau of Industry and Security. Normally the assigned US ECCN code is valid also for re-export of US origin products from most countries in the world.                                

However, a product which can be exported from the US without an export license or by a license exception might well need one when re-exporting from an EU country.

The United States is the only country with extra-territorial export/re-export controls:

  • If a product is U.S. origin
  • If a product is made of U.S. technology
  • If a product is made by a U.S. company
  • If a product is shipped through the U.S.
  • If a product is sold by a U.S. citizen