Export Control Reform Is Here: Aerospace Industry Is First, Others To Follow

On April 16, 2013, the Obama administration, through the departments of State and Commerce, issued important new rules as part of its Export Control Reform (ECR) initiative. These rules, which are the first in a series of new State and Commerce regulations expected in the coming months, become effective on October 15, 2013 and will have a major impact on the aerospace industry, which is heavily regulated under U.S. export control laws. Specifically, the rules will transition control over a number of items manufactured for the aerospace industry from the International Traffic in Arms Regulations (ITAR) to the Export Administration Regulations (EAR), requiring aerospace companies around the world that manufacture, export or re-export ITAR-controlled items to evaluate and amend their current authorizations and to restructure compliance activities in order to meet tight regulatory deadlines and avoid violations of the new laws. As further ECR final rules are published, companies in other regulated industries will also need to account for additional changes within this evolving framework.