What are the steps to assess export control risks?

1 Know your product

The first step to assess export control risks is to know your product and its technical specifications. You need to determine if your product is subject to any export control lists, such as the Commerce Control List (CCL) or the US Munitions List (USML) in the US, or the Dual-Use List or the Military List in the EU. These lists classify products according to their sensitivity and potential uses for military or proliferation purposes. You also need to check if your product is subject to any end-use or end-user restrictions, such as the Entity List or the Denied Persons List in the US, or the Consolidated List of Sanctions in the EU. These lists identify entities or individuals that are prohibited or restricted from receiving certain exports.

2 Know your destination

The second step to assess export control risks is to know your destination and its political and security situation. You need to check if your destination country is subject to any sanctions or embargoes, such as the Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) or the Crimea Region Sanctions in the US, or the Common Foreign and Security Policy (CFSP) in the EU. These sanctions or embargoes may impose restrictions or prohibitions on the export of certain goods, technologies, or services to specific countries or regions. You also need to check if your destination country is a member of any multilateral export control regimes, such as the Wassenaar Arrangement or the Nuclear Suppliers Group. These regimes establish guidelines and best practices for the export of sensitive items and aim to prevent their diversion or misuse.

3 Know your customer

The third step to assess export control risks is to know your customer and their background and intentions. You need to conduct due diligence on your customer and verify their identity, address, and business activities. You need to ask for references, certifications, and end-user statements. You need to screen your customer against any watch lists or blacklists, such as the Specially Designated Nationals (SDN) List or the Foreign Terrorist Organizations (FTO) List in the US, or the Anti-Terrorism Regulation in the EU. These lists designate individuals or entities that are involved in terrorism, money laundering, human rights violations, or other illicit activities. You also need to monitor your customer's behavior and transactions and look for any red flags, such as requests for unusual payment methods, delivery routes, or technical assistance.

4 Know your license

The fourth step to assess export control risks is to know your license and its requirements and conditions. You need to determine if your export requires a license from the relevant authority, such as the Bureau of Industry and Security (BIS) or the Directorate of Defense Trade Controls (DDTC) in the US, or the competent national authority in the EU. You need to apply for the appropriate license type, such as an individual license, a general license, or an exception or exemption. You need to comply with the license terms, such as the validity period, the quantity, the value, or the end-use. You also need to keep records of your license application, approval, and usage and report any changes or incidents to the authority.

5 Know your compliance

The fifth step to assess export control risks is to know your compliance and its benefits and challenges. You need to develop and implement an effective export compliance program that covers the following elements: management commitment, risk assessment, policies and procedures, training and awareness, screening and verification, documentation and recordkeeping, auditing and monitoring, and corrective actions and improvements. You need to align your compliance program with the best practices and standards of your industry and the export control regimes. You also need to review and update your compliance program regularly and adapt to the changing export control environment.

6 Know your resources

The sixth and final step to assess export control risks is to know your resources and their availability and reliability. You need to access and use various resources that can help you with your export control risk assessment and mitigation, such as: official websites and publications of the export control authorities and regimes, industry associations and networks, trade shows and seminars, consultants and advisors, software and tools, and training and education. You need to evaluate and select the resources that suit your needs, budget, and objectives. You also need to stay informed and updated on the latest developments and trends in the export control field.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?