Commercially available equipment, software, materials and associated proprietary technology are, under certain circumstances, subject to U.S. federal export controls regulations. This is true whether we source the item in the U.S, or we import the item from an international source.
As part of the LBNL’s overall export compliance program, Purchasing plays an important role in assisting our research community and the export compliance function to proactively identify which items might be export controlled, so that subsequent international shipment and/or access and use of such items by foreign nationals present in our facilities is in accordance with these regulations. Items are controlled for various reasons, including (but not limited to) national security, nuclear proliferation, missile technology containment, global chemical/biological concerns, etc.
When the access and/or use of an export controlled item at LBNL requires prior authorization from one of the U.S. Government export control authorities, this is called a "deemed" export. For purposes of this definition, foreign nationals are defined as those individuals who are not U.S. citizens, Permanent Residents ("Green Card" holders) or recipients of Political Asylum status. Hence, foreign nationals are individuals with temporary immigrant visa status typically including (but not limited to) H1-B, J-1, F-1, and B-1-visa beneficiaries. In addition, the DOE inserts U.S. citizen-only requirements with respect to accessing certain highly sensitive equipment and technologies at LBNL.
Federal export control regulations are strictly enforced, with severe monetary and federal debarment enforcement options applicable at the institutional level and, for an individual, when an export violation is found to be intentionally committed and directly attributable.
Therefore, it is Procurement’s specific role to help the LBNL proactively understand what export controlled items and technologies are entering the Lab’s inventory which is one essential part of the Lab’s overall compliance effort. (See Section 3, Penalties for Export Violations)
So, what do we need to know about how these controls operate in the Purchasing environment?
Items (instruments, materials, software, proprietary technology) may be export controlled either under the Export Administration Regulations’ (EAR) Commerce Control List (CCL dual use items) or as defense items under the International Traffic in Arms Regulations (ITAR) U.S. Munitions List (USML defense items).
Dual use items (civil by design but could inherently have a defense capability) that are controlled under the CCL are designated with Export Control Commodity Numbers (ECCNs), for example 6A002.a(1). If an item has no ECCN control, it is classified as EAR99.
ITAR USML Items (those specially designed or modified for defense purposes) are designated by Roman numeral Categories I-XXII and further delineated through various alphabetized sub parts (for example, Category VIII(a)). ITAR items are the most critical concern, because the State Department tightly restricts foreign national access to an ITAR item, regardless of whether or not there is an intention to actually use the item or an understanding of how to use it. This restriction can extend to visual access in the laboratory environment.
Note: ITAR restrictions operate even in the context of open laboratory, fundamental research projects pursuant to which no other citizenship or publication restrictions have been accepted. Therefore, because of the access threshold, it is essential to understand whether an item is specifically ITAR controlled prior to its incorporation into the LBNL’s research environment.
EAR restrictions, on the other hand, are generally technology-related restrictions, based on an actual level of use or access to associated technical data which conveys the underlying controlled design of the item. Therefore, subject only to certain exceptions, mere operation of a dual use item does not, in itself, trigger foreign national access/use restrictions. In the EAR context, our concern is whether there is proprietary (non-publicly available) information, such as a user manual or software compilation library, that may be part of the acquisition and be export controlled.
Goals and Benefits of Export Control Consideration in the Purchasing Context:
- Ensures that equipment, software, materials and proprietary technology with foreign access restrictions are properly secured.
- Simplifies the back-end export approval process when shipping items internationally for modification, testing, service, or repair.
1. Prescreen the Vendor
All vendors must first be screened against all required export control Restricted Party lists using Visual Compliance, a cloud based screening tool that searches persons and entities identified in the Federal Register who represent a national security (or other) concern to U.S. Government agencies. This screening process takes place in the Office of the Chief Financial Officer (OCFO) at the Laboratory when new vendors are setup.
2. Managing technical data (build-to-print specifications) provided by the Requestor
- Upon receiving any technical data specifications (e.g. blue prints, specifications, CAD files, fabrication drawings, documented instructions or product parameters) from a Requestor that is intended to be provided to the supplier by Procurement via incorporation into the subcontract or a solicitation, Procurement will refer such technical data to email@example.com prior to transmitting such data, so that the Export Control team can first determine if the data is export controlled. If the data is not determined to be export controlled, the Export Control team shall notify Procurement that such data may be transmitted to the supplier. The Requester must ensure that the Export Control team is advised, prior to submission to the subcontractor, of any technical data to be provided to the supplier that is not formally incorporated into the subcontract or solicitation by Procurement.
- In the event that the data is export controlled, the Export Control team will determine how to mark and handle the data. If the supplier is a U.S. based supplier, it will be necessary for the Export Control team to issue a Request for Assurance to the supplier, requiring the supplier to acknowledge that a) it will be receiving export controlled data from LBL; and b) manage the data accordingly with respect to foreign national access by the vendor’s employees and contractors (if applicable). If the supplier is located outside the U.S., thereby resulting in an actual export of the data, the Export Control team shall facilitate any export license or license exemption requirement. In both scenarios, the Export Control team shall coordinate these processes with Procurement.
3. Determine "export classification" from the vendor
- Procurement obtains information to determine if the items are export-controlled under the ITAR, the USML, or the EAR.
- Procurement will either:
- Send the vendor a Representations and Certifications form prior to awarding the subcontract. This form will be used for purchases over $150K. The form will have questions for the vendor to answer in order to help determine the classification of any items requested for purchase, or
- Include an Export Control article in the subcontract requiring the vendor to self-classify any export controlled items if the purchase is equal to or under $150K.
- The Procurement Representations and Certifications form, or the inclusion of the Export Control subcontract article with a requirement for self-classification of any export controlled items will help determine if:
- If the vendor classifies any item as ITAR-controlled, under the USML, then Procurement will notify the Requester and the LBNL Export Control Officer. The Requester may wish to explore alternative non-ITAR models with similar capabilities.
- If the vendor classifies any item as EAR-controlled under the CCL – other than "EAR99", then Procurement will merely notify firstname.lastname@example.org of the acquisition, for recordkeeping purposes.
- If, on the other hand, and pursuant to EAR-controlled items, the subcontractor will be delivering export controlled equipment user guides, installation/repair/or maintenance documentation, or software that is designated as proprietary (i.e. not in the public domain through the vendor’s website or other open source), Procurement will notify email@example.com to coordinate the appropriate handling of the information in concert with the Requestor.
- In cases where we are ordering: an ITAR item; certain EAR controlled items used in aviation, satellite and cryptography research and development; certain biologics; and proprietary, export controlled information and software, the Requestor will work with firstname.lastname@example.org to implement a Technology Control Plan (TCP) to manage the appropriate level of access and use control.
Exporting Laboratory Property
Laboratory property that is intended to be permanently exported must have Property Management (PM) approval before workers may leave it in, or ship it to, a foreign destination. The LBNL Personal Property Policy Manual contains requirements associated with property furnished under loan agreements and transferring property to foreign entities.
High-Risk Property is defined in the LBNL Personal Property Policy Manual as,
“Property that, because of its potential impact on public health and safety, the environment, national security interests, or proliferation concerns, must be controlled, and disposed of in other than the routine manner. The categories of high-risk property are automatic data processing equipment, especially designed or prepared property, export controlled information, export controlled property, hazardous property, nuclear weapon components or weapon-like components, proliferation-sensitive property, radioactive property, special nuclear material, and unclassified controlled nuclear information.” (Note: last six categories are also subject to export controls)
Transfer or Disposition of High-Risk Property
The High-Risk Property Program incorporates an export control review of Laboratory property (barcoded and non-barcoded) that the Laboratory transfers, disposes of, or otherwise releases to the public. Workers must contact their Property Specialist for all requests to transfer or dispose of Laboratory property.
See the LBNL Personal Property Policy Manual, Section 3.5, High Risk Personal Property.