New Required Destination Control Statement Language for Exported Goods: Deadline November 15 2016

Fennemore Craig Update

New Required Destination Control Statement Language for Exported Goods: Deadline November 15 2016

The U.S. Export Administration Regulations (EAR) required all exports of tangible goods to include a destination control statements on most exports.  The International Traffic in Arms Regulations (ITAR) had a similar but slightly different statement. On August 17, 2016, the Department of Commerce’s Bureau of Industry & Security and the Department of State’s Directorate of Defense Trade Controls finalized rules to adopt a new harmonized destination control statement to comply with both the EAR and ITAR (the “DCS”). The purpose of the DCS is to alert parties outside the United States who receive the item and/or technical data, in tangible form, that (1) the item is subject to U.S. export control laws and regulations; (2) it was exported in accordance with the EAR and ITAR; and (3) diversion of the item contrary to U.S. law is prohibited. 

The new required and harmonized language is as follows:

These items are controlled by the U.S. government and authorized for export only to the country of ultimate destination for use by the ultimate consignee or end user(s) herein identified. They may not be resold, transferred, or otherwise disposed of, to any other country or to any person other than the authorized ultimate consignee or end-user(s), either in their original form or after being incorporated into other items without first obtaining approval from the U.S. government or as otherwise authorized by U.S. law and regulations.

The required language is mandatory for all exporters, even if they are not exporting 600 series or 9×515 items. If you are exporting 600 series or 9×515 items (generally, missiles, training equipment, explosives, protective equipment and satellites), then you must also include the export control classification number (ECCN) on the commercial invoice.

All exporters of goods must use this harmonized DCS on all commercial invoices by no later than November 15, 2016, make all other necessary changes to commercial invoices, contractual language and compliance manuals, and ensure proper education and training of relevant personnel.  While the rule requires that the DCS be incorporated only in the commercial invoice, it can be included in all sales contracts going forward.

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