International Traffic in Arms Regulations (ITAR)

What is ITAR?

ITAR is the government’s way to protect our national security and international interests by limiting foreigners’ ability to purchase American weapons. It would be a recipe for disaster if our enemies could simply buy their weapons from American companies and use them against us. Thus, ITAR prevents the transfer of weapons to objectionable persons, countries, or groups.

How does ITAR protect our national security?

ITAR is enforced by the Department of State (DOS), Directorate of Defense Trade Controls (DDTC), Office of Defense Trade Controls Compliance. DDTC oversees the export of all defense weapons (firearms, ammunition, military equipment, etc.), defense services (consulting, hired security, etc.) and defense data. DDTC also control imports, but only temporarily. DDTC works with other departments as well to help the Defense Department process export licenses. DDTC consult with the Justice Department in regard to criminal activity, administers trade regulations with the U.S. Customs and Border Protection, and also works with the intelligence agencies to identify and track unauthorized transfers.

What does ITAR regulate?

Under Section 38 of the Arms Export Control Act (22 U.S.C. 2778), as amended, no defense articles or defense services may be exported without a license for such export.

Export means (1) an actual shipment or transmission out of the United States, including the sending or taking of a defense article out of the United States in any manner; (2) releasing or otherwise transferring technical data to a foreign person in the United States (a “deemed export”); or (3) performing a defense service on behalf of, or for the benefit of, a foreign person, whether in the United States or abroad. Any release in the United States of technical data to a foreign person is deemed to be an export to all countries in which the foreign person has held or holds citizenship or holds permanent residency.

Defense article means any item or technical data designated in 22 CFR § 121.1 (also known as the U.S. Munitions List, “USML”).

Technical data means information that is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles. This includes information in the form of blueprints, drawings, photographs, plans, instructions or documentation. This term also includes technical data recorded or stored in any physical form, models, mockups or other items that reveal technical data directly relating to items designated in the USML. It also includes forgings, castings, and other unfinished products, such as extrusions and machined bodies, that have reached a stage in manufacturing where they are clearly identifiable by mechanical properties, material composition, geometry, or function as defense articles. See 22 CFR §§ 120.6, 120.10(a)(1). Excluded from the definition of technical data is information already available in the public domain (as defined by 22 CFR § 120.11) and other noted exemptions in 22 CFR § 125.4.

Defense services means (1) The furnishing of assistance (including training) to foreign persons, whether in the United States or abroad in the design, development, engineering, manufacture, production, assembly, testing, repair, maintenance, modification, operation, demilitarization, destruction, processing or use of defense articles; (2) The furnishing to foreign persons of any technical data, whether in the United States or abroad; or (3) Military training of foreign units and forces, regular and irregular, including formal or informal instruction of foreign persons in the United States or abroad or by correspondence courses, technical, educational, or information publications and media of all kinds, training aid, orientation, training exercise, and military advice. (The approval of the Directorate of Defense Trade Controls must be obtained before defense services may be furnished, 22 CFR § 124.1)

A foreign person means any natural person who is not a lawful permanent resident as defined by 8 US Code § 1101(20) or who is not a protected individual as defined by 8 US Code § 1324b(a)(3). A foreign person also means any foreign corporation, business association, partnership, trust, society or any other entity or group that is not incorporated or organized to do business in the United States, as well as international organizations, foreign governments and any agency or subdivision of foreign governments (e.g., diplomatic missions).

On May 24, 2018, the DOS introduced a proposed rule amendment that would revise USML Category I, covering firearms and related articles, to exclude non-automatic and semi-automatic firearms to caliber .50 (12.7mm) inclusive, currently controlled under paragraph (a), and all of the parts, components, accessories, and attachments specially designed for those articles. However, since SOF Arms still manufacturers fully automatic firearms and receivers, we would still be subject to ITAR if this proposed rule amendment were to become implemented.

In other words, since SOF Arms manufactures items included in the USML (Category I(a),(b),(g)) any data regarding SOF Arms’ design, development, production, manufacture, assembly, operation, repair, testing, maintenance, or modification, may only be shared with and furnished to U.S. citizens and U.S. organized and incorporated businesses.

What constitutes a violation?

In furtherance of world peace and the security and foreign policy, Section 38 of the Arms Export Control Act (22 U.S.C. 2778) requires:

Registration—Every person (other than an officer or employee of the United States Government acting in an official capacity) who engages in the business of manufacturing, exporting, or importing any defense articles or defense services to register with DDTC.

Licensing—No defense articles or defense services designated on the USML may be exported without a license for such export. Exporting defense articles or defense services means disclosing or transferring defense articles or its technical data to a foreign person, a license is required to be issued by the DDTC. This includes sending schematics or drawings to a foreign person to receive a quote, or consult on the manufacture of a particular item, and even having a discussion over the phone, unless DDTC prior approval and a license is granted.

For each violation, a fine may be imposed of not more than $1,000,000 or imprisoned not more than 20 years, or both.