More on the Export Control Reform Initiative

The current system is based on two different control lists, administered by two different departments, and three different primary licensing agencies

By ·

In an effort to focus governmental resources on the most serious national security threats, in August, 2009 President Obama directed a broad-based interagency review of the U.S. export control system.

To support this effort, a newly created Export Promotion Cabinet, in collaboration with the 20 federal agencies comprising the Trade Promotion Coordinating Committee conducted a year-long assessment which found that the current U.S. export control system does not sufficiently reduce national security risk because its structure is overly complicated, contains too many redundancies and tries to protect too much. 

It cited the fact that the current system is: (a) based on two different control lists; (b) administered by two different departments and three different primary licensing agencies (none of which sees the licenses issued by the other); (c) also affected by a multitude of enforcement agencies with overlapping and duplicative authorities.  Many of the varying oversight agencies have separate IT systems (none of which are easily accessible or compatible with each other;  some have no IT systems at all yet still issue licenses.  The assessment concluded that the fragmentation of the system combined with the extensive list of controlled items inhibited the national security objectives.

In April, 2010, former Defense Secretary Gates called for the removal of licensing requirements for the bulk of tens of thousands of license applications for which the Export Administration Regulations (EAR) permit export to EU and NATO countries.  Gates advocated creating a system in which “higher walls are placed around fewer, more critical items.”

The assessment led President Obama to outline the foundation for a new export control system in August, 2010, resulting in the launch of the Export Control Reform Initiative.  Generally, the reforms include reconciling various definitions, regulations and policies for export control with a goal of creating a single control list, one licensing agency, a unified information technology system and a new Export Enforcement Coordination Center, dubbed “E2C2.”

The first step toward implementation -  application of new criteria for rebuilding the various lists -  was announced by President Obama in December, 2010. In July, 2011, the Commerce Department published a proposed rule advocating several fundamental changes to the export control system. 

These included a new framework for controlling defense articles deemed less militarily significant by moving them from the more restrictive U.S. Munitions List to the more flexible Commerce Control List.  The proposed rule also defined the licensing policies for those items to be moved and proposed a single definition for terms central to the system.  The proposed rule marks the next step toward harmonizing the two control lists. E2C2 opened on November 9, 2011.


About the Author

Martha Lessman Katz
Martha Lessman Katz specializes in data security and privacy, intellectual property, licensing and technology transactions, eCommerce, social media and other issues relating to the internet. She is a member of the law firm of Gordon, Feinblatt, Rothman, Hoffberger & Hollander LLC and can be reached at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

All Topics
Latest Whitepaper
Outsourced Transportation Management
All the benefits of owning a fleet without the headache of managing it.
Download Today!
From the August 2017 Logistics Management Magazine Issue
Which carriers, third-party logistics providers, and North American ports have crossed the service excellence finish line ahead of their competitors? Our readers have cast their votes, and now it’s time to introduce this year’s winners of the coveted Quest for Quality Awards.
BMW Takes the Inland Road to Efficiency
Global Logistics: No Shortcuts to Security
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Getting the most out of your 3PL relationship
Join Evan Armstrong, president of Armstrong & Associates, as he explains how creating a balanced portfolio of "Top 50" global and domestic partners can maximize efficiency and mitigate risk.
Register Today!
EDITORS' PICKS
34th Annual Quest for Quality Awards: Winners Revealed
Which carriers, third-party logistics providers, and North American ports have crossed the service...
2017 Top 50 3PLs: Investment and Consolidation Maintain Traction
The trend set over the past few years for mergers and acquisitions has hardly subsided, and a fresh...

2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...