Understanding export controls on these more abstract exports is crucial for those working in relevant industries, particularly those in the technology, aerospace, telecoms and engineering sectors. However, all manufacturers producing controlled goods are likely to be subject to controls on intangible items or communications.
Intangibles
Intangible items are non-physical products or services, including a host of technologies from software to surveillance systems. With intangible goods like software, if something could be used for both civil and military applications e.g. encryption software – it is likely to be dual use and it falls under the regulations.
Technology, which is also considered dual use, includes things like data plans, engineering designs and blueprints. The designs used to manufacture a product – not just the product itself – are subject to the regulations.
Communications
Dual-use communications, meanwhile, include emails, files shared online and even verbal transmission of information relating to controlled goods, such as technical specifications. If you are having a conversation via email with somebody about a non-controlled project but you bring up something that would fall under controls such as blueprints – that’s when regulations around dual-use communications apply.
If a product is controlled, then all the information surrounding it is likely also controlled.
This applies if you are having a conversation with someone in another country or even someone in the same country but of a different nationality. It’s important to be aware of the fact controls apply even when information is shared within a nation.
Intangible requirements
Exporting technology and communications subject to controls follows a similar process to the one for tangible goods, and any manufacturer whose goods are affected by export controls can also be subject to controls on intangibles and communications. UK dual-use licences cover both tangible and intangible goods, but there are important distinctions in how they are applied:
Tangible goods: A dual-use licence is required to export tangible goods that could be used for both civilian and military purposes (dual-use items). These items are listed on the UK Strategic Export Control Lists, which include the EU Dual-Use List.
Intangible goods: Intangible exports also fall under dual-use licencing requirements if they pertain to technology or software that can be used for military or WMD purposes. This includes the sharing of technical data, designs, blueprints, and even know-how. Ultimately, while UK dual-use licences cover both tangible and intangible goods, they are regulated slightly differently due to the nature of their transfer and potential use. It’s crucial for businesses involved in international trade to understand the scope of their dual-use licences to ensure compliance with UK export control laws.
Be aware
As with dual-use goods, a lack of awareness can affect firms whose technology or communications are controlled. Staff may not be aware that verbal communications about sensitive technology, even during meetings or conferences, could be subject to export controls.
Failure to document and keep records of intangible transfers can lead to compliance issues during audits.
It’s also important to note that even if a firm is only operating within one country, controls can still apply when communicating with those in another. It can be easy to share technology or sensitive information accidentally, e.g. companies might inadvertently ‘export’ controlled technology by sharing it via email, cloud services, or even during international phone calls without realising that these activities are regulated.
Communications controls
For communications in particular, firms need to share their licence number when communicating controlled information and keep records of all such sharing. If a firm obtains an open general export licence (OGEL), for instance, they must share the relevant technology OGEL number in communications about that technology.
You are also required to record these communications in a log to show how many times you’ve used it and where you’ve exported the information. This must be sent for review each January, accounting for the previous year. This also applies to other types of export licence such as a standard individual export licence (SIEL) or an open individual export licence (OIEL).
Where to watch
It’s important to be particularly vigilant with sanctioned countries such as Russia, Iran or North Korea.
It is also important to be careful with ‘countries of concern’ such as China or Venezuela, while even emerging economies in regions such as Africa or the Middle East can act as routes for controlled goods or information.